Datadog Gears Up to Report Q4 Earnings: What's in the Offing?

Datadog DDOG is set to report fourth-quarter 2025 results on Feb. 10.

DDOG expects fourth-quarter 2025 revenues between $912 million and $916 million, representing 24% year-over-year growth. The Zacks Consensus Estimate for revenues is pegged at $914.6 million for the quarter, suggesting a 23.97% rise from the year-ago quarter’s reported figure.

DDOG’s third-quarter 2025 diluted non-GAAP earnings per share are expected to be between 44 and 46 cents.

The Zacks Consensus Estimate for Datadog’s third-quarter earnings is pegged at 55 cents per share, unchanged over the past 30 days. The estimate indicates a year-over-year increase of 12.24%.

Datadog, Inc. Price and EPS Surprise

Datadog, Inc. price-eps-surprise | Datadog, Inc. Quote

Datadog’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average positive surprise of 14.47%.

Let us see how things have shaped up for the upcoming announcement.

Key Factors to Note for DDOG’s Q4 Results

Datadog is expected to have entered the fourth quarter of 2025, confronting several operational headwinds. Multiple factors are expected to have pressured the company's performance during the to-be-reported quarter.

Year-end customer behavior patterns likely created challenges for the usage-based business model. Enterprise workloads typically experience reduced activity as organisations slow operations during holiday periods, which is expected to have affected consumption levels throughout December.

The relationship with the company's largest AI-native customer is expected to have presented complications. This customer accounted for 12% of total revenue in the third quarter compared to 11% in the second quarter. The company renegotiated this customer's agreement during the third quarter, establishing increased usage commitments alongside modified economic terms. Such restructured arrangements generally create pressure on revenue capture as new pricing takes effect ahead of incremental volume growth.

Product announcements during the period included the availability of Bits AI SRE, the company's inaugural AI agent offering for automated incident investigation. The company also expanded its partnership with Amazon Web Services, adding features for monitoring AI workloads and cloud storage. These releases occurred late in the quarter, and many capabilities remained in preview mode, limiting their potential revenue impact during the reporting period.

The company added specialized sales leadership focused on financial services clients. Such personnel investments typically require time to generate meaningful contributions to new customer acquisition and expansion activity.

What Our Model Says About DDOG Stock

The proven Zacks model does not conclusively predict an earnings beat for Datadog this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Datadog has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell) at present. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Stocks to Consider

Here are some companies worth considering, as our model shows that these have the right combination of elements to beat earnings in their upcoming releases:

IPG Photonics IPGP has an Earnings ESP of +15.08% and presently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

IPG Photonics is set to report fourth-quarter 2025 results on Feb. 12. The Zacks Consensus Estimate for the fourth-quarter earnings is pegged at 25 cents per share, revised upward by a penny over the past 30 days. Estimates for IPG Photonics’ EPS for the fourth quarter indicate a year-over-year increase of 38.9%.

Applied Materials AMAT is set to report first-quarter fiscal 2026 results on Feb. 12. The stock has an Earnings ESP of +3.06% and presently carries a Zacks Rank #2.

The Zacks Consensus Estimate for Applied Materials’ first-quarter earnings has remained unchanged at $2.19 per share over the past 60 days. The consensus estimate for Applied Materials’ EPS for the first quarter implies a year-over-year decline of approximately 8%.

Vertiv VRT is set to report fourth-quarter 2025 results on Feb. 11. The stock has an Earnings ESP of +2.23% and presently carries a Zacks Rank #2.

The Zacks Consensus Estimate for Vertiv’s fourth-quarter earnings is pegged at $1.29 per share, which has been revised upward by a penny over the past 30 days. Estimates for Vertiv’s fourth-quarter EPS indicate year-over-year growth of 30.3%.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research