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Dynatrace (DT) Q2 Earnings: What To Expect


Jabin Bastian /
2024/08/06 3:14 am EDT

Application performance monitoring software provider Dynatrace (NYSE:DT) will be reporting results tomorrow morning. Here's what to expect.

Dynatrace beat analysts' revenue expectations by 1.4% last quarter, reporting revenues of $380.8 million, up 21.1% year on year. It was a mixed quarter for the company, with an impressive beat of analysts' billings estimates but management forecasting growth to slow.

Is Dynatrace a buy or sell going into earnings? Read our full analysis here, it's free.

This quarter, analysts are expecting Dynatrace's revenue to grow 17.8% year on year to $392.3 million, slowing from the 24.5% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.29 per share.

Dynatrace Total Revenue

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Dynatrace has a history of exceeding Wall Street's expectations, beating revenue estimates every single time over the past two years by 2.4% on average.

Looking at Dynatrace's peers in the software development segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Bandwidth delivered year-on-year revenue growth of 19%, meeting analysts' expectations, and Cloudflare reported revenues up 30%, topping estimates by 1.6%. Bandwidth traded down 33.3% following the results while Cloudflare was up 6.9%.

Read our full analysis of Bandwidth's results here and Cloudflare's results here.

Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. 2024 has been a bumpier ride as the market switches between optimism and pessimism around rate cuts thanks to mixed inflation data, and while some of the software development stocks have fared somewhat better, they have not been spared, with share prices down 6% on average over the last month. Dynatrace is down 7.4% during the same time and is heading into earnings with an average analyst price target of $57.1 (compared to the current share price of $41.93).

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