As we reflect back on the just completed Q4 cloud monitoring sector earnings season, we dig into the relative performance of New Relic (NYSE:NEWR) and its peers.
Software is eating the world, increasing organizations’ reliance on digital-only solutions. As more workloads and applications move to the cloud, the reliability of the underlying cloud infrastructure becomes ever more critical, and ever more complex. To solve the challenge, companies and their engineering teams have turned to a range of cloud monitoring tools that provide them with visibility to troubleshoot the issues in real time.
The 5 cloud monitoring stocks we track reported a mixed Q4; on average, revenues beat analyst consensus estimates by 4.05%, while on average next quarter revenue guidance was 0.64% above consensus. Tech stocks have been hit the hardest as investors start to value profits over growth, but cloud monitoring stocks held their ground better than others, with the share prices up 13.7% since the previous earnings results, on average.
New Relic (NYSE:NEWR)
With the name being an anagram of its founder, Lew Cirne, New Relic (NYSE:NEWR) makes a monitoring software that collects, scores, and analyses performance data about a client's IT stack.
New Relic reported revenues of $239.8 million, up 17.8% year on year, beating analyst expectations by 2.93%. It was a solid quarter for the company, with a significant improvement in gross margin and a decent beat of analyst estimates.
“We executed the quarter with relentless focus on our customers, product innovation and operations, and beat the high end of our guidance for revenue and profitability,” said New Relic CEO Bill Staples.
New Relic delivered the slowest revenue growth of the whole group. The stock is up 10.7% since the results and currently trades at $71.47.
Is now the time to buy New Relic? Access our full analysis of the earnings results here, it's free.
Best Q4: Sumo Logic (NASDAQ:SUMO)
Founded in 2010 by Christian Beegden who went from driving a cab in Germany to landing an internship at Amazon, Sumo Logic (NASDAQ:SUMO) is software as a service data analytics platform that helps companies get insight into what is happening in their servers and applications.
Sumo Logic reported revenues of $79 million, up 27.3% year on year, beating analyst expectations by 6.41%. It was a very strong quarter for the company, with a significant improvement in gross margin and a solid beat of analyst estimates.
Sumo Logic scored the strongest analyst estimates beat and highest full year guidance raise among its peers. The stock is up 64.9% since the results and currently trades at $11.87.
Is now the time to buy Sumo Logic? Access our full analysis of the earnings results here, it's free.
PagerDuty (NYSE:PD)
Started by three former Amazon engineers, PagerDuty (NYSE:PD) is a software as a service platform that helps companies respond to IT incidents fast and make sure that any downtime is minimized.
PagerDuty reported revenues of $101 million, up 28.6% year on year, beating analyst expectations by 1.99%. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and decelerating customer growth.
PagerDuty had the weakest performance against analyst estimates in the group. The company lost 21 customers and ended up with a total of 15,244. The stock is up 12.5% since the results and currently trades at $31.33.
Read our full analysis of PagerDuty's results here.
Datadog (NASDAQ:DDOG)
Named after a database the founders had to painstakingly look after at their previous company, Datadog (NASDAQ:DDOG) is a software as a service platform that makes it easier to monitor cloud infrastructure and applications.
Datadog reported revenues of $469.4 million, up 43.9% year on year, beating analyst expectations by 4.44%. It was a weaker quarter for the company, with revenue guidance for the next quarter and the full year guidance missing analysts' expectations.
Datadog achieved the fastest revenue growth but had the weakest full year guidance update among the peers. The company added 180 enterprise customers paying more than $100,000 annually to a total of 2,780. The stock is down 26.2% since the results and currently trades at $65.5.
Read our full, actionable report on Datadog here, it's free.
Dynatrace (NYSE:DT)
Founded in Austria in 2005, Dynatrace (NYSE:DT) provides companies with software that allows them to monitor the performance of their full technology stack, from software applications to the infrastructure they run on.
Dynatrace reported revenues of $297.5 million, up 23.5% year on year, beating analyst expectations by 4.46%. It was a strong quarter for the company, with very optimistic guidance for the next quarter.
The stock is up 6.84% since the results and currently trades at $41.07.
Read our full, actionable report on Dynatrace here, it's free.
The author has no position in any of the stocks mentioned