DDOG Datadog Inc.
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Daily prices, adjusted for splits. P/E and P/S value each day on the results published by then; a gap in P/E means the trailing year had no profit.
Software - Application · New York, NY · 8,100 employees · datadoghq.com
Datadog provides a cloud-based observability and security platform designed to monitor applications and technical infrastructure. The company generates revenue by selling software tools for performance tracking, log management, and threat management to organizations worldwide.
Bull case
Contracted backlog is expanding faster than recognized revenue, pointing to sustained client commitments. The business also experiences tailwinds from selling artificial intelligence tools, with software placed directly where automated agents carry out work.
- The price assumes about +45% a year cash-flow growth; it delivered +239% a year over three years.
- Annual revenue growth rose from +26% to +32%.
- Contracted backlog grew +43% over the year, against +32% for revenue.
- The share price trend is rising.
Bear case
The business relies on heavy stock-based compensation relative to its revenue. There is also a minor risk that external artificial intelligence tools could replace portions of its product catalog.
- Trades at the 84th percentile of its own valuation history.
- Valued above what companies with similar growth, margins and size trade at.
- Stock pay equals 21% of revenue.
Features
- V-OVERVALUED Overvalued The price is 47% above its own-history reference value.
- V-ACCELERATING Growth accelerating Annual revenue growth rose from +26% to +32%. Shared by most companies we track
- G-AGENCY Heavy stock pay Stock pay equals 21% of revenue.
- F-BACKLOG-VELOCITY Backlog outpacing revenue Contracted backlog grew +43% over the year, against +32% for revenue.
AI impact
Sells AI to its customers Tailwind
Datadog sells cloud observability and security software, benefiting from its central position in troubleshooting and incident response workflows where autonomous artificial intelligence agents operate. However, the company faces the risk that competitors may more successfully incorporate artificial intelligence tools and gain greater market acceptance.
Where AI helps it
- Its software sits where AI agents would do the work
Where AI could hurt it
- AI tools could do part of what it sells (minor)
In the company's words
In 2025, we launched OnCall to create on-call schedules and integrate real-time observability data into customers' incident response plans, Product Analytics to improve business outcomes and product development decisions with quantitative insights into user experiences and behavior, and Bits AI SRE…
Our competitors may more successfully incorporate AI into their products and achieve higher market acceptance of their AI solutions, which could impair our ability to compete effectively and adversely affect our results of operations.
Assessed by AI from the company's own annual report filed 18 Feb 2026 and quarterly report filed 6 Aug 2026. A reading of the business, not a forecast or a recommendation.
Valuation position
DDOG is at the 84th percentile of its own valuation history. Depending on how far back you look, it ranges from the 84th to the 100th percentile. This is a relative measurement, not a price target or recommendation, and it assumes the business is still the one its history describes.
Price ladder
The measured price sits in the Above reference zone. These are reference zones, not buy instructions or forecasts that the prices will be reached.
What the price assumes
The measured price implies roughly +45.4% annual cash-flow growth, between +35.9% and +52.5% under other reasonable assumptions. Over the last three years it delivered +238.7% a year.
An estimate that depends on its assumptions, not a forecast.
Quality versus peers
Each dimension is shown on its own; they are not combined into a score.
Current analyst snapshot
Shown for reference only; not used in any measurement.
What would have to break
- Not triggered — Revenue decline
- Not triggered — Margin break
- Not available — Cash burn with rising debt
- Not triggered — Heavy dilution
- Not triggered — Warning language in filings
News
No recent brief on this company.