Dynatrace (NYSE:DT) Posts Quarterly Earnings Results, Beats Estimates By $0.04 EPS

Dynatrace (NYSE:DT) issued its quarterly earnings data on Wednesday. The company reported $0.48 earnings per share for the quarter, topping analysts’ consensus estimates of $0.44 by $0.04, FiscalAI reports. Dynatrace had a return on equity of 10.37% and a net margin of 8.06%.The firm had revenue of $554.55 million during the quarter, compared to analysts’ expectations of $549.46 million. During the same period in the prior year, the business posted $0.42 EPS. The firm’s quarterly revenue was up 16.3% on a year-over-year basis. 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 Stock Up 11.5%

Shares of Dynatrace stock traded up $5.26 during midday trading on Wednesday, hitting $50.97. The company had a trading volume of 18,353,672 shares, compared to its average volume of 4,069,042. The stock has a market cap of $14.79 billion, a price-to-earnings ratio of 94.39, a PEG ratio of 2.94 and a beta of 0.72. The company has a fifty day simple moving average of $43.21 and a 200 day simple moving average of $39.45. Dynatrace has a 12-month low of $31.64 and a 12-month high of $53.29.

Analyst Upgrades and Downgrades

DT has been the subject of several analyst reports. BMO Capital Markets increased their price target on shares of Dynatrace from $43.00 to $50.00 and gave the company an “outperform” rating in a research report on Tuesday, June 16th. Cantor Fitzgerald increased their target price on shares of Dynatrace from $37.00 to $47.00 and gave the company a “neutral” rating in a research report on Monday. KeyCorp lifted their price target on shares of Dynatrace from $47.00 to $53.00 and gave the stock an “overweight” rating in a report on Thursday, July 16th. Guggenheim downgraded Dynatrace from a “buy” rating to a “neutral” rating in a research report on Wednesday, May 13th. Finally, William Blair began coverage on Dynatrace in a research report on Thursday, May 21st. They issued an “outperform” rating for the company. One investment 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 company. According to data from MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and a consensus price target of $50.38.

Key Stories Impacting Dynatrace

Here are the key news stories impacting Dynatrace this week:

• 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

Several large investors have recently bought and sold shares of the stock. nVerses Capital LLC acquired a new stake in shares of Dynatrace during the fourth quarter worth $249,000. PDT Partners LLC purchased a new position in shares of Dynatrace in the fourth quarter worth about $247,000. DRW Securities LLC acquired a new stake in shares of Dynatrace during the fourth quarter worth about $243,000. Loomis Sayles & Co. L P lifted its holdings in shares of Dynatrace by 434.9% during the fourth quarter. Loomis Sayles & Co. L P now owns 5,365 shares of the company’s stock worth $233,000 after purchasing an additional 4,362 shares during the period. Finally, Coldstream Capital Management Inc. lifted its holdings in shares of Dynatrace by 10.5% during the third quarter. Coldstream Capital Management Inc. now owns 4,604 shares of the company’s stock worth $223,000 after purchasing an additional 437 shares during the period. Hedge funds and other institutional investors own 94.28% of the company’s stock.

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.