The following is a summary of the Dynatrace, Inc. (DT) Q4 2024 Earnings Call Transcript:

Financial Performance:

• Dynatrace reported a 50% growth in 2 years with an Annual Recurring Revenue of $1.5 billion for Q4 2024 and closed the largest new logo and first nine-figure Total Contract Value deals.

• Net income reached $89 million, exceeding the high-end guidance by 20% and subscription revenue grew by 22% at $360 million.

• Gross retention rate remained stable in the mid-90s percentage and net retention rate surpassed 111%.

• Anticipated Annual Recurring Revenue for the next fiscal year is between $1.72 billion - $1.735 billion and total revenue between $1.644 billion - $1.658 billion with a non-GAAP operating margin of approximately 28%.

Business Progress:

• Dynatrace completed 18 seven-figure deals in Q4 and added 168 new logos, reflecting its growing market penetration and strength as an observability platform provider.

• Traction for application security and logs solutions are on the rise with 600 customers each, expecting to cross $100 million revenue thresholds by fiscal 2026.

• An investment strategy is in place with focus on R&D, sales capacity, customer success, and partnership program.

• A shift in go-to-market approach is planned, focusing on end-to-end observability opportunities, application performance, and cloud modernization.

• Observations show a trend towards centralization of observability decisions amongst customers, providing Dynatrace an opportunity to leverage its unique position in the market.

More details: Dynatrace IR

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