NEW YORK - Dynatrace Inc. (NYSE:DT) shares tumbled 6% in premarket trading Thursday despite the software intelligence company beating earnings and revenue expectations for its fiscal second quarter, as its guidance failed to impress investors.
The Waltham, Massachusetts-based company reported adjusted earnings per share of $0.37 for the quarter ended September 30, surpassing the analyst consensus of $0.32. Revenue came in at $418 million, exceeding estimates of $406.16 million and marking a 19% increase YoY.
"Our continued out-performance across all of our key metrics is a result of the strength of our platform and ability to execute effectively in a dynamic market," said Rick McConnell, Chief Executive Officer of Dynatrace.
However, the company's guidance for the current quarter fell short of expectations. Dynatrace forecast Q3 adjusted EPS of $0.32-$0.33, in line with the $0.32 consensus. It projected Q3 revenue of $425-428 million, above the $416 million analyst estimate but implying a slowdown in growth to 16-17% YoY.
Annual recurring revenue (ARR) grew 20% YoY to $1.62 billion, or 19% on a constant currency basis. Subscription revenue increased 20% to $399.8 million.
The company's non-GAAP operating margin expanded to 31% from 30% in the year-ago quarter. Free cash flow declined to $20.1 million from $34.1 million a year earlier.
For the full fiscal year 2025, Dynatrace raised its revenue outlook to $1.665-$1.675 billion, up from its prior guidance of $1.644-$1.658 billion.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.