FILE PHOTO: A logo for Datadog is seen during the KubeCon + CloudNativeCon Europe hosted by the Cloud Native Computing Foundation (CNCF) in Paris, France, March 20, 2024. REUTERS/Benoit Tessier/File Photo
(Reuters) -Cloud security firm Datadog forecast third-quarter revenue above Wall Street estimates on Thursday, signaling growing demand for its services as enterprises ramp up investment in artificial intelligence.
Shares of the New York City-based company surged more than 10% in premarket trading.
Businesses are accelerating the adoption of AI and cloud technologies, driving increased demand for Datadog's suite of products that monitor and secure cloud-based applications to ensure performance, reliability, and security of these systems.
The company benefits from the broader migration to cloud infrastructure, which has created new requirements for real-time monitoring and analytics.
Datadog's platform, used by clients including Samsung, NASDAQ and Comcast, enables organizations to monitor and analyze their digital operations, helping them to identify and resolve technical issues.
The company said it showcased 125 new innovations to "help customers observe, secure, and act on their complex cloud environments and AI tech stacks."
Datadog expects third-quarter revenue between $847 million and $851 million, above analysts' estimates of $819.9 million, according to data compiled by LSEG.
The company expects adjusted profit per share between 44 cents and 46 cents, above estimates of 42 cents.
For the second quarter, it posted revenue of $827 million, beating estimates of $791.1 million.
On an adjusted basis, the company earned 46 cents per share compared with the estimates of 42 cents per share.
(Reporting by Kritika Lamba in Bengaluru; Editing by Shailesh Kuber and Harikrishnan Nair)
