Dynatrace Reports Fourth Quarter and Full Year Fiscal 2025 Financial Results
Dynatrace (NYSE: DT), the leading AI-powered observability platform, today announced financial results for the fourth quarter and full year ended March 31, 2025. "Dynatrace delivered a strong finish ...
Exceeds high end of guidance across all FY25 metrics
Delivers FY25 Subscription Revenue growth of 20% year-over-year on a constant currency basis
Achieves FY25 GAAP Operating Margin of 11% and Non-GAAP Operating Margin of 29%
WALTHAM, Mass.: Dynatrace (NYSE: DT), the leading AI-powered observability platform, today announced financial results for the fourth quarter and full year ended March 31, 2025.
"Dynatrace delivered a strong finish to fiscal 2025. Our fourth quarter results exceeded guidance on all of our key operating metrics, fueled by broad consumption growth across the platform," said Rick McConnell, Chief Executive Officer of Dynatrace. "The world continues to shift to cloud and AI-native software deployments. Purpose-built for this environment, Dynatrace’s AI-powered observability platform provides customers not only with rich technical analytics but also valuable business insights. We remain focused on delivering extraordinary customer value, generating strong profitability and free cash flow, and investing thoughtfully in strategic priorities to capture the substantial opportunities we see ahead."
All growth rates are compared to the fourth quarter and full year fiscal 2024 ended March 31, 2024 unless otherwise noted.
Fourth Quarter Fiscal 2025 Financial Highlights:
- Total ARR of $1,734 million, an increase of 15%, or 17% on a constant currency basis
- Total Revenue of $445 million, an increase of 17%, or 19% on a constant currency basis
- Subscription Revenue of $424 million, an increase of 18%, or 20% on a constant currency basis
- GAAP Income from Operations of $43 million and Non-GAAP Income from Operations of $118 million
- GAAP EPS of $0.13 and non-GAAP EPS of $0.33, on a dilutive basis
Full Year Fiscal 2025 Financial Highlights:
- Total Revenue of $1,699 million, an increase of 19%, or 20% on a constant currency basis
- Subscription Revenue of $1,622 million, an increase of 19%, or 20% on a constant currency basis
- GAAP Income from Operations of $179 million and Non-GAAP Income from Operations of $494 million
- GAAP EPS of $1.591 and non-GAAP EPS of $1.39, on a dilutive basis
- GAAP Operating Cash Flow of $459 million and Free Cash Flow of $431 million
Business Highlights:
- Go-to-market traction: Dynatrace closed 15 deals greater than $1 million in annual contract value (ACV) in the quarter, fourteen of which were in collaboration with partners. Dynatrace Platform Subscription (DPS) licensing models continue to gain traction with over 40% of our customer base and more than 60% of our ARR leveraging this flexible, scalable, and transparent subscription approach. Consumption growth rates across the Dynatrace platform continued to outpace revenue growth, with consumption growth rates for DPS customers growing twice the rate of SKU-based customers.
- Partner evolution: Dynatrace signed a new strategic collaboration agreement with Amazon Web Services (AWS) to optimize the digital enterprise to provide joint customers with elevated business insights and accelerated time to outcomes. In addition, we announced early access for joint Google Cloud customers to our latest platform innovations, powered by Grail™ enabling customers to benefit from the combined power of the Dynatrace platform with Google Cloud's cutting-edge infrastructure and AI capabilities.
- Industry and customer recognition: Dynatrace was named a Leader in The Forrester Wave™: AIOps Platforms, Q2 2025 report2 with the highest score in the Current Offering category. Dynatrace was also named a Leader and Outperformer in the 2025 GigaOm Radar Report for Cloud Observability, highlighting the company’s industry leadership and proven ability to help customers turn complex data into an asset by leveraging its AI-powered observability platform. In addition, Dynatrace has been named a Customers’ Choice in the 2024 Gartner Peer Insights Voice of the Customer for Observability Platforms report.3
Share Repurchase Program
- During the fourth quarter, Dynatrace spent $43 million to repurchase 787,000 shares at an average price of $53.99 under its $500 million share repurchase program. From the inception of the program in May 2024 through March 31, 2025, Dynatrace has repurchased 3.4 million shares for $173 million at an average price of $50.06.
_________________________
2 Forrester does not endorse any company, product, brand, or service included in its research publications and does not advise any person to select the products or services of any company or brand based on the ratings included in such publications. Information is based on the best available resources. Opinions reflect judgment at the time and are subject to change. For more information, read about Forrester’s objectivity here.
3 Gartner, Peer Insights Voice of the Customer for Observability Platforms, By Peer Contributors, 24 December 2024.
GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally, PEER INSIGHTS is a registered trademark of Gartner, Inc. and/or its affiliates and are used herein with permission. All rights reserved.
Gartner Peer Insights content consists of the opinions of individual end users based on their own experiences, and should not be construed as statements of fact, nor do they represent the views of Gartner or its affiliates. Gartner does not endorse any vendor, product or service depicted in this content nor makes any warranties, expressed or implied, with respect to this content, about its accuracy or completeness, including any warranties of merchantability or fitness for a particular purpose.
The Gartner content described herein (the “Gartner Content”) represents research opinion or viewpoints published, as part of a syndicated subscription service, by Gartner, Inc. ("Gartner"), and is not a representation of fact. Gartner Content speaks as of its original publication date (and not as of the date of this Earnings Press Release), and the opinions expressed in the Gartner Content are subject to change without notice. |
Fourth Quarter 2025 Financial Highlights (Unaudited – In thousands, except per share data) | |||||||
| Three Months Ended March 31, | ||||||
|
| 2025 |
|
|
| 2024 |
|
Annual recurring revenue (ARR): |
|
|
| ||||
Total ARR | $ | 1,734,164 |
|
| $ | 1,503,819 |
|
Year-over-Year Increase |
| 15 | % |
|
| ||
Year-over-Year Increase - constant currency (*) |
| 17 | % |
|
| ||
|
|
|
| ||||
Revenue: |
|
|
| ||||
Total revenue | $ | 445,165 |
|
| $ | 380,848 |
|
Year-over-Year Increase |
| 17 | % |
|
| ||
Year-over-Year Increase - constant currency (*) |
| 19 | % |
|
| ||
|
|
|
| ||||
Subscription revenue | $ | 423,570 |
|
| $ | 360,109 |
|
Year-over-Year Increase |
| 18 | % |
|
| ||
Year-over-Year Increase - constant currency (*) |
| 20 | % |
|
| ||
|
|
|
| ||||
GAAP Financial Measures: |
|
|
| ||||
GAAP income from operations | $ | 42,914 |
|
| $ | 23,123 |
|
GAAP operating margin |
| 10 | % |
|
| 6 | % |
|
|
|
| ||||
GAAP net income | $ | 39,304 |
|
| $ | 37,944 |
|
|
|
|
| ||||
GAAP net income per share - diluted | $ | 0.13 |
|
| $ | 0.13 |
|
|
|
|
| ||||
GAAP shares outstanding - diluted |
| 304,354 |
|
|
| 300,867 |
|
|
|
|
| ||||
Net cash provided by operating activities | $ | 162,790 |
|
| $ | 131,672 |
|
Net cash provided by operating activities as a percent of revenue |
| 37 | % |
|
| 35 | % |
|
|
|
| ||||
Non-GAAP Financial Measures (*): |
|
|
| ||||
Non-GAAP income from operations | $ | 117,887 |
|
| $ | 95,093 |
|
Non-GAAP operating margin |
| 26 | % |
|
| 25 | % |
|
|
|
| ||||
Non-GAAP net income | $ | 99,047 |
|
| $ | 89,401 |
|
|
|
|
| ||||
Non-GAAP net income per share - diluted | $ | 0.33 |
|
| $ | 0.30 |
|
|
|
|
| ||||
Non-GAAP shares outstanding - diluted |
| 304,354 |
|
|
| 300,867 |
|
|
|
|
| ||||
Free Cash Flow | $ | 145,528 |
|
| $ | 121,262 |
|
Free Cash Flow margin |
| 33 | % |
|
| 32 | % |
Full Year 2025 Financial Highlights (Unaudited – In thousands, except per share data) | |||||||
| Year Ended March 31, | ||||||
|
| 2025 |
|
|
| 2024 |
|
Revenue: |
|
|
| ||||
Total revenue | $ | 1,698,683 |
|
| $ | 1,430,530 |
|
Year-over-Year Increase |
| 19 | % |
|
| ||
Year-over-Year Increase - constant currency (*) |
| 20 | % |
|
| ||
|
|
|
| ||||
Subscription revenue | $ | 1,622,163 |
|
| $ | 1,359,354 |
|
Year-over-Year Increase |
| 19 | % |
|
| ||
Year-over-Year Increase - constant currency (*) |
| 20 | % |
|
| ||
|
|
|
| ||||
GAAP Financial Measures: |
|
|
| ||||
GAAP income from operations | $ | 179,433 |
|
| $ | 128,400 |
|
GAAP operating margin |
| 11 | % |
|
| 9 | % |
|
|
|
| ||||
GAAP net income (**) | $ | 483,684 |
|
| $ | 154,632 |
|
|
|
|
| ||||
GAAP net income per share - diluted (**) | $ | 1.59 |
|
| $ | 0.52 |
|
|
|
|
| ||||
GAAP shares outstanding - diluted |
| 303,602 |
|
|
| 299,280 |
|
|
|
|
| ||||
Net cash provided by operating activities | $ | 459,419 |
|
| $ | 378,109 |
|
Net cash provided by operating activities as a percent of revenue |
| 27 | % |
|
| 26 | % |
|
|
|
| ||||
Non-GAAP Financial Measures (*): |
|
|
| ||||
Non-GAAP income from operations | $ | 493,540 |
|
| $ | 398,239 |
|
Non-GAAP operating margin |
| 29 | % |
|
| 28 | % |
|
|
|
| ||||
Non-GAAP net income | $ | 422,313 |
|
| $ | 358,117 |
|
|
|
|
| ||||
Non-GAAP net income per share - diluted | $ | 1.39 |
|
| $ |
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