Dynatrace stock fell on Thursday after the enterprise software maker reported fiscal second-quarter earnings and revenue that topped Wall Street targets. Guidance came in slightly above expectations.
On the stock market today, Dynatrace stock fell 4.4% to 54.00 in early trades. Waltham, Mass.-based Dynatrace reported earnings before the market open.
For the quarter ending Sept. 30, Dynatrace earnings were 37 cents a share on an adjusted basis, up 19% from a year earlier. Revenue climbed 19% to $418 million, the company said.
Analysts had estimated adjusted profit of 32 cents on revenue of $406.2 million.
Dynatrace Stock: ARR Key Financial Metric
Annual recurring revenue, or ARR, is a key financial metric for many software companies. Dynatrace said fiscal Q3 ARR from subscriptions rose 20% to $1.617 billion vs. estimates of $1.567 billion.
The company forecast December quarter revenue of $425 million to $428 million vs. estimates of $416 million.
"ARR growth of 19% was in line," said TD Cowen analyst Andrew Sherman in a report. "But fiscal ARR guide was maintained at 16% growth ($1.720 billion to $1.735 billion)."
Heading into the Dynatrace earnings report, the enterprise software stock was about flat in 2024.
The software maker's computer network monitoring tools measure and analyze the performance of business-critical applications. In the "observability" market, Dynatrace and others also monitor application performance over cloud-computing infrastructure.
From a technical view, Dynatrace stock is in a buy range from a cup-with-handle base, after clearing an entry point at 55.49. Also, private equity firm Thoma Bravo sold off its remaining stake in Dynatrace in early 2024.
Also, Dynatrace owns a Relative Strength Rating of 65 out of a best-possible 99, according to IBD Stock Checkup.
Further, Dynatrace competes with Datadog[ticker symb=DDOG] and others.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
