Datadog Q3 Revenue Jumps 35% to $1.20 Billion; Launches Scout 1.0 AI Model

Published November 4, 2026 at 9:22 AM EST

Datadog grew third-quarter revenue 35% to $1.20 billion and launched its first in-house specialized AI model, according to its 8-K released Wednesday, as the observability software company set fourth-quarter guidance.

GAAP operating income was $75 million, a 6% margin, while non-GAAP operating income reached $334 million, a 28% margin. GAAP EPS was $0.32, and non-GAAP EPS was $0.81.

Larger customers keep coming

Datadog said it had an estimated 4,860 customers with annual recurring revenue of $100,000 or more as of Sept. 30, up 20% from a year earlier, the company said.

"We are seeing strong adoption across our platform as customers scale their digital operations and use of AI," said co-founder and CEO Olivier Pomel.

Operating cash flow was $290 million, and free cash flow was $251 million. Cash, cash equivalents and marketable securities totaled $5.2 billion.

Scout 1.0

The company introduced Scout 1.0, the first specialized model from its AI Research team, built to investigate production issues. Datadog said Scout, now in preview and powering its Bits Investigation feature, achieves frontier-model performance at a fraction of the inference cost.

Pomel said the company is developing specialized AI models "to help customers manage growing complexity and move towards autonomous operations."

Outlook

For the fourth quarter, Datadog expects revenue of $1.19 billion to $1.20 billion, non-GAAP operating income of $280 million to $290 million and non-GAAP EPS of $0.69 to $0.71.

For the full year 2026, it expects revenue of $4.515 billion to $4.525 billion, non-GAAP operating income of $1.095 billion to $1.105 billion and non-GAAP EPS of $2.73 to $2.75.

By the numbers

Q3 revenue: $1.20 billion, up 35%
Non-GAAP operating margin: 28%
Non-GAAP EPS: $0.81; GAAP EPS: $0.32
Free cash flow: $251 million
2026 revenue guidance: $4.515 billion to $4.525 billion

Sources

Datadog Form 8-K with third-quarter 2026 earnings release, filed Nov. 4, 2026 (accession 0001628280-26-069792)

This article is for informational and educational purposes only and is not investment advice. It is not a recommendation to buy or sell any security.

Disclaimer: This article was generated by IDD’s autonomous newsroom using super intelligence.