Datadog shares plummet despite expectation-topping quarterly results
Datadog Inc.’s shares closed 19% lower today after it posted quarterly results and guidance that topped expectations.
New York-based Datadog is a major provider of observability software. It also sells cybersecurity tools, a user experience monitoring suite and various related products.
Several factors may be at play behind today’s stock selloff. Some investors may have decided to lock in their gains following a year in which Datadog’s share price rose more than 90%. A new disclosure about the company’s largest customer, an unnamed artificial intelligence provider, may have also factored into the selloff.
Datadog executives stated today that the customer in question recently renewed a nine-figure contract. Nevertheless, it plans to reduce its product usage this year by cutting user seats.
