Dynatrace Holdings LLC (DT) Q2 2020 Earnings Call Transcript DT earnings call for the period ending September 30, 2019. Customers are excited about it because it gives them a direct connection between some of this sort of metrics and problem determination, items under the hood directly with business outcome metrics. The initial land is very consistent with where it's been, in the 90,000 to 100,000 initial land. Turning to revenue. Salaries posted anonymously by Dynatrace employees. So, that's been consistent for us over the last year, couple of years. Please refer to the cautionary language in today's press release and to our Form 10-Q, which was filed with the SEC on September 5, 2019; and our other SEC filings for a discussion of the risks and uncertainties that could cause actual results to differ materially from expectations. We are very pleased with the company's performance in the second quarter, which resulted in financial results and were better than our topline and bottomline guidance. One of the most powerful brought to market in Q2 was a doubling of capacity of a Dynatrace cluster, which now scales to 50,000 hosts per cluster. Dynatrace Named One of the Top 10 Highest-Rated Cloud Companies to Work For by Battery Ventures and Glassdoor. DEM is sort of more pervasive at the moment. Our best estimates are even at the high end, they're in the 20% to 30% range with the Dynatrace, but they all want to get to 50-plus. 04:26PM : Dynatrace Earnings Triple; Cloud Software Maker's Stock Falls. ET. Over the last 12 months, 58% of our Dynatrace customer growth has been the result of new logos to the company. (Bloomberg) -- Oracle Corp. co-founder Larry Ellison said he has moved his primary residence to Hawaii, becoming the latest Silicon Valley executive to depart the state where they built their fortunes.Ellison, the world’s 11th-wealthiest person, notified his staff Monday of the move. And so, could you kind of flesh out how like a Google Analytics and a Dynatrace are complementary not competitive? We expect third quarter non-GAAP operating income to be in the range of $30 million to $31 million and non-GAAP EPS of $0.06 to $0.07 per share. This is something that we expect to continue benefiting from in the foreseeable future as we've barely scratched the surface of cloud application expansion. Maybe not initial sale, but how do you see that opportunity progressing relative to what those customers who bought it, either DEM or ACM plus subscription on logging. Obviously, we have an expanding sales organization, so that certainly helps. I don't think it's that. Ashburn: Startup Is Changing the Way People Retire, Apartment Investment Completes Separation Into Two Companies, The stock market flashes a major new sell signal: BofA survey. We will continue to confirm this net expansion rate on a quarterly basis, and we plan to share this actual net extension value at the end of the fiscal year. To listen to the event live or access a replay of the call - visit https://www.investornetwork.com/event/presentation/68803. Great customer experience (CX) sets businesses apart and promotes lifelong loyalty. And the stat that I think Kevin gave you, which is 58% over trailing 12 months, 58% of the new customers added to the Dynatrace platform, somewhere a little over 900 customers there, 58% have been new logos to the business. So that's how we go-to-market today. You offer a separate SKU there, obviously. So healthy new logos, as you point out, and room to increase that rate as we free up the sales organization in four short quarters here. Read about the reinvention of Dynatrace as they explored the future of application monitoring. Many of our plans provide three primary care visits in Virginia at no additional cost to you. With that, we will open the call for questions. I wanted to touch first on the infrastructure monitoring SKU. The Dow Jones Industrial Average hit new session highs midday as Apple rallies and lawmakers set to discuss a coronavirus stimulus deal. The reason people come to us for the infrastructure-only host extension is because once they get the hang of the value of our integrated AI engine, Davis, they realize that to see that live topology all at once and have it all sort of monitor 24x7 by an intelligent assistant, it makes their life so much easier across a much wider landscape. For the third quarter, we expect total revenue to be in the range of $137 million to $138 million, representing year-over-year growth of 19% to 20%. Non-GAAP net income per share is now expected to be in the range of $0.23 to $0.24 per share, assuming approximately 275 million weighted average diluted shares for the year. The acceleration in total revenue growth is being driven by the strong growth in subscription revenue, which was $115.8 million in the second quarter, an increase of 41% year over year. Motley Fool. Maybe that will change in the future, but I don't think that's dissimilar to some of our competitors, land in a position of strength and expand from there. Maybe touching on one other product, the DEM, obviously. Information on stock, financials, earnings, subsidiaries, investors, and executives for Dynatrace. Live webinar: No metric left alone - Feeding all your observability data into Dynatrace AIOps Thursday, November 19, 4:00 pm CET / 10:00 am ET Get insights to the new metrics ingest interface and show you how to report custom metrics from various different data sources. In addition to his three hotels, he also owns a significant chunk of the housing stock as well as the main grocery store and the monthly newspaper there.The Oracle chairman joins other tech leaders and ultra-wealthy in leaving California, with some pointing to the state’s high taxes. The Ascent is The Motley Fool's new personal finance brand devoted to helping you live a richer life. IN is an Issuer Direct brand, to learn more or for the latest financial news and market information, visit www.investornetwork.com. Nearly every new customer win is precipitated by the realization that their cloud program is disrupting their ability to keep up with the accelerating complexity of the ecosystem supporting their digital transformation. Dynatrace provides answers to the underlying issues affecting user journeys, enabling them to optimize user experience and improve conversion rates. Stay up to date with lastest Earnings Announcements for Dynatrace, Inc. from Zacks Investment Research So as that continues, and that trend continues, I do think our new logo expansion to the franchise will continue to be robust. Our current Dynatrace ARR per customer is north of $200,000, and we continue to believe that there's a large opportunity for further expansion in our existing customer base. 06:22PM : Why Dynatrace Stock Dropped Today. Let me finish by highlighting the expansion of our Dynatrace platform itself, which we believe will further improve our ability to win new customers, expand with existing customers and incent Classic customers to convert to Dynatrace. And then I guess, in cases where you sold it, how successful have you been in migrating those guys up to the full platform? And the follow-up is just in regard to pricing structure in logging, how do you guys feel about that given where Datadog is and also, the changes being made at Splunk? Is the stock a buy now? They're still trying to bring together their observability solutions, something we've had for the last four years. What I was alluding to as far as integrations with some of these other solutions that the business side of the house utilize day to day, I'm alluding to the sort of tighter integration with some of these other tools like a Google, where they're complementary with each other and brought together and connected, they can be a lot more powerful than each one sort of separate on their own. As a result, all of our ARR expansion is either product expansion or adding new logos to the business. The Mortgage Program for Costco Members could help some members buy or refinance a home through a multilender platform operated by CrossCountry Mortgage. Consistent with prior quarters, a majority of these customers continue to be net new logos to our business. But still early days, and there's still a lot of headroom just on that application side before you even get to the cross-sell into additional ITOM use cases. Going forward, the business will continue to naturally delever due to our healthy cash margins, and we expect to steadily pay down debt over time which we believe will continue to create value for our shareholders. Warren Buffet's aide believes that the market is on "the edge of playing with fire. It's also the team you assemble around you. This optimism is reflected in the increased top line guidance that Kevin will detail in a few minutes. For example, a major insurer in the U.K. has been in the process of digital transformation. A couple of years ago, there was a low demand for digital experience as everybody were just standing up their clouds and they were spending more time just trying to figure out how to make the infrastructure itself work and try to get it in shape for business-critical workloads. A free inside look at Dynatrace salary trends based on 376 salaries wages for 195 jobs at Dynatrace. Yes. Learn more. Our non-GAAP gross margin was 82.5% for the second quarter, an improvement compared to 80.5% in the second quarter of fiscal '19. We believe Dynatrace's financial profile is highly unique, including meaningful scale, strong growth, healthy profitability and cash flow. We are consistently winning new cloud business against all competitors. So, from a conversion standpoint, the new platform is extremely sticky. We are not simply upgrading from one product set to a new version. Total revenue is now expected to be in a range of $533 million to $535 million, an increase from our prior guidance of $521 million to $524 million. We now have about 1,800 of them penetrated, so a little over 10%. Our trailing 12-month adjusted EBITDA of $117.4 million. Munger called technology "a killer and an opportunity." Once customers are on the new Dynatrace platform, we continue to see rapid expansion, which is evidenced by the rapid growth in our ARR that I referenced earlier. During their proof of concept, something we do with all new customers to demonstrate the Dynatrace difference, they discovered the power of Dynatrace's explainable AI engine, Davis, which continually learns what normal performance is, processing billions of dependencies in real time to serve up precise answers that were beyond their team's ability to quickly identify. After looking at a number of cloud monitoring solutions, the insurer selected Dynatrace as they've determined that it was the only platform that could show them the cost of outages in the context of application performance and how degradations and performance impacted their call center operations. And we're seeing that in the net expansion rates being healthy, and I believe we'll continue to see that over time as we get more comfortable and sort of the cross-selling of some of these other modules into the customer base. Investor Network (IN) is a financial content community, serving millions of unique investors market information, earnings, commentary and news on what's trending. It's to show them, not just the Dynatrace advantage, but show them that it actually is true. Dynatrace Holdings LLC (DT) Q2 2021 Earnings Call Transcript DT earnings call for the period ending September 30, 2020. And given that there's a lot of players usually involved in those types of digital transformation projects, be it SIs or hyperscalers or other platform solutions, I'd just be curious where in the process Dynatrace comes into those types of transactions. All statements other than statements of historical fact are forward-looking statements, including statements regarding management's expectations of future financial and operational performance and operational expenditures; expected growth and business outlook, including our financial guidance for the third-fiscal quarter and full year 2020. With that, I'd like to turn the call over to our chief executive officer, John Van Siclen. So that is an important part of our go-to-market portfolio, but we still find the majority of our opportunities through our direct sales organization. That's why we call it the microservices wall because that's what customers hit. As of September 30, we had cash and cash equivalents of $211.7 million, and our long-term debt was $569.8 million. Certainly, seeing ARR accelerate at scale is impressive, and I think in your prepared remarks, you're clearly having success converting Classic customers. A large U.S.-based consumer products company that completed a seven-figure expansion just five months after their initial land purchase of the Dynatrace platform. As John indicated, we believe the best measure and reflection of our ongoing revenue growth profile is the combination of subscription and services revenue which was $126.6 million in the quarter, representing 98% of total revenue and an increase of 37% on a year-over-year basis. So, our competitive position continues to be very strong. Before moving to guidance, I'd like to review a few items that impacted our GAAP results for the second quarter as previewed in our Q1 call. It's about assuring better business outcomes by adopting measure by user experience, conversion rates, increased revenue or enhanced brand loyalty. Second, as a result of the spinoff of the mainframe business, we recorded a spin tax charge of approximately $256 million. It is worth pointing out that we expect the combination of subscription and services to grow over 30% in the third quarter. Apartment Investment and Management announces the separation of its businesses, creating two separate publicly traded companies. Please keep in mind that we received $265 million from the mainframe business pre-IPO and that these funds are being used to pay the federal and state taxes related to the spin. The exciting thing is that while the land is nice, it's the expansion that has accelerated for us versus our Classic product world. I'll start by providing a more detailed review of our second quarter performance, and then I will finish with our outlook for the third quarter and increased full-year guidance. Sure. This represented an increase from 25% growth last quarter and 17% growth in the previous quarter. So just trying to get some of the color on what you're seeing there, too. I mean it's healthy versus a lot of competitors out there that land in very small mid-market footprints. But there’s a dark side to Dow 30k –and it’s going to take 99% of Americans by surprise. Before we start, I'd like to draw your attention to the Safe Harbor statement included in today's press release. He said that Sequoia had made more money than anybody.See more from Benzinga * Click here for options trades from Benzinga * Asia Slips, Europe Mixed On Tighter Curbs, Looming Lockdown Fears * Google Kills Its Google Home Max Smart Speaker Line(C) 2020 Benzinga.com. But now we see the workloads starting to hit the cloud platforms at an accelerated rate. So it's been a great advantage to us as we move people across on to the Dynatrace platform. The Food and Drug Administration authorized Pfizer's coronavirus vaccine for emergency use late Friday. Luminar Technologies Inc. stock dropped more than 13% on Tuesday, extending the lidar-sensor company's losing streak to a fifth consecutive session, as word that Mobileye plans to make its own sensors reached investors. I got to tell you that the monitoring space has had dozens and dozens of companies in it for decades now. Well, our business analytics are directly connected with performance, user experience, and connected all the way down into infrastructure and virtual network elements that may or may not be affecting performance issues. Congrats on the quarter. He doesn't like the idea of everyone getting sucked into finance and get rich by outsmarting the rest of the world in marketable securities.Munger expects market returns in the next 10 years to be lower than the last 10. Over time, we believe Digital Business Analytics will extend our total addressable market by several billion dollars as we enter the $24 billion analytics and business intelligence market as defined by Gartner. Innoviz looks to make a splash in the Lidar sensor market. A quick one. Once again, during the quarter, over 200 new customers have joined the Dynatrace platform family. You talked about the digital experience, seeing attach rates ticking up. I'll take each of these in order, starting with business from new customers. Listen to on-demand earnings calls of Dynatrace Inc (DT) stock So, there's plenty of headroom. Everybody sort of sits on the surface and sort of bubbles along, Google, Adobe, etc. The second part of the question? But the stock market is signaling optimism about the U.S. economy in 2021, experts say. These are the electric car stocks with the best value, fastest growth, and most momentum for Q1 2021. 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