Dynatrace (NYSE:DT – Get Free Report) posted its quarterly earnings data on Wednesday. The company reported $0.48 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.44 by $0.04, FiscalAI reports. The company had revenue of $554.55 million during the quarter, compared to analysts’ expectations of $549.46 million. Dynatrace had a return on equity of 10.37% and a net margin of 8.06%.Dynatrace’s revenue was up 16.3% compared to the same quarter last year. During the same quarter in the previous year, the business earned $0.42 EPS. Dynatrace updated its Q2 2027 guidance to 0.480-0.490 EPS and its FY 2027 guidance to 1.970-1.990 EPS.
Here are the key takeaways from Dynatrace’s conference call:
- Strong Q1 execution: ARR grew 17%, net new ARR increased 66% year over year (41% organically), and record new-logo growth exceeded 160%. Total and subscription revenue both surpassed the high end of guidance, while operating margin reached 29%.
- Dynatrace reported continued momentum in consumption, particularly log management, which nearly doubled to approximately $200 million in annualized consumption. More than 1,000 customers now monitor AI workloads and over 800 use agentic capabilities; AI-focused customers consume at 1.5 times the rate of other customers.
- The company raised its full-year revenue growth outlook to 14.5%-15%, increased the high end of operating-margin guidance to 29.75%, and raised non-GAAP EPS guidance to $1.97-$1.99. Management maintained its 15.5%-16.5% constant-currency ARR growth target and expressed confidence in fiscal-year ARR acceleration.
- Net retention remained at 110%, with management expecting a potential improvement in the second half as roughly 70% of DPS renewal activity occurs then and higher consumption supports expansions. Q1 and Q2 are comparatively light renewal periods, limiting near-term visibility into that upside.
- Foreign-exchange movements became a larger headwind, reducing the outlook by approximately $14 million for ARR and $4 million for revenue. CFO Jim Benson also plans to retire by the end of the fiscal year, creating a leadership transition risk despite management’s expectation of a smooth succession.
Dynatrace Trading Up 11.5%
Shares of DT traded up $5.26 during midday trading on Wednesday, reaching $50.97. 18,353,672 shares of the stock were exchanged, compared to its average volume of 4,069,042. The company has a market capitalization of $14.79 billion, a P/E ratio of 94.39, a PEG ratio of 2.94 and a beta of 0.72. Dynatrace has a 52 week low of $31.64 and a 52 week high of $53.29. The company’s 50 day moving average is $43.21 and its two-hundred day moving average is $39.45.
More Dynatrace News
- Positive Sentiment: Dynatrace reported adjusted EPS of $0.48, exceeding the $0.44 consensus estimate and rising from $0.42 a year earlier. Revenue reached $554.55 million, topping expectations of $549.46 million and increasing 16.3% year over year. Dynatrace earnings results
- Positive Sentiment: Management cited 41% organic net new annual recurring revenue growth, signaling strong customer demand and improving momentum in its observability platform. Dynatrace fiscal first-quarter results
- Positive Sentiment: Fiscal 2027 EPS guidance of $1.97-$1.99 is well above the approximately $1.78 analyst consensus, while second-quarter EPS guidance of $0.48-$0.49 also exceeds the $0.44 consensus.
- Positive Sentiment: BTIG Research raised its price target from $47 to $62 and upgraded the stock to “buy,” adding to the bullish analyst reaction following the earnings release. BTIG price-target increase
- Neutral Sentiment: Fiscal 2027 revenue guidance of approximately $2.3 billion is broadly in line with Wall Street expectations, limiting the upside from the otherwise strong EPS outlook.
- Negative Sentiment: Second-quarter revenue guidance of $565 million-$570 million is slightly below the $570.1 million consensus, and reports indicated that Dynatrace modestly lowered its full-year revenue outlook. Dynatrace earnings and guidance report
Institutional Trading of Dynatrace
A number of hedge funds have recently added to or reduced their stakes in the business. State Street Corp increased its position in Dynatrace by 1.0% during the 4th quarter. State Street Corp now owns 10,664,357 shares of the company’s stock valued at $462,193,000 after purchasing an additional 101,994 shares during the period. Wellington Management Group LLP lifted its position in shares of Dynatrace by 9.0% in the 4th quarter. Wellington Management Group LLP now owns 7,999,919 shares of the company’s stock worth $346,716,000 after purchasing an additional 659,792 shares during the period. Alyeska Investment Group L.P. boosted its stake in shares of Dynatrace by 1,201.7% during the fourth quarter. Alyeska Investment Group L.P. now owns 2,888,249 shares of the company’s stock valued at $125,177,000 after purchasing an additional 2,666,373 shares in the last quarter. Scge Management L.P. purchased a new position in Dynatrace during the second quarter valued at approximately $155,858,000. Finally, Northern Trust Corp increased its holdings in Dynatrace by 1.4% during the third quarter. Northern Trust Corp now owns 2,822,509 shares of the company’s stock valued at $136,751,000 after buying an additional 38,148 shares during the period. 94.28% of the stock is owned by hedge funds and other institutional investors.
Wall Street Analysts Forecast Growth
Several research firms have recently weighed in on DT. JPMorgan Chase & Co. decreased their target price on Dynatrace from $50.00 to $45.00 and set an “overweight” rating for the company in a research report on Thursday, May 14th. Wedbush set a $48.00 price target on shares of Dynatrace in a report on Friday, May 15th. William Blair started coverage on shares of Dynatrace in a research note on Thursday, May 21st. They issued an “outperform” rating on the stock. Rosenblatt Securities reiterated a “buy” rating and set a $52.00 price objective on shares of Dynatrace in a report on Tuesday. Finally, Rothschild & Co Redburn began coverage on shares of Dynatrace in a research report on Thursday, April 23rd. They issued a “neutral” rating and a $40.00 price objective for the company. One analyst has rated the stock with a Strong Buy rating, twenty-two have assigned a Buy rating and seven have given a Hold rating to the stock. According to MarketBeat, the company has a consensus rating of “Moderate Buy” and a consensus target price of $50.38.
View Our Latest Stock Analysis on DT
About Dynatrace
Dynatrace is a global software intelligence company specializing in application performance management (APM), cloud infrastructure monitoring, and digital experience management. Its flagship offering, the Dynatrace Software Intelligence Platform, leverages artificial intelligence to provide real-time observability across distributed environments, including on-premises data centers, private clouds, public clouds and hybrid deployments. Organizations rely on Dynatrace to detect anomalies, troubleshoot performance issues and optimize end-user experiences through automated root-cause analysis powered by the company’s engine, Davis.
The Dynatrace platform comprises modules for full-stack application monitoring, digital experience monitoring, infrastructure monitoring and business analytics.
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