Dynatrace (DT) on Thursday reported fiscal third quarter earnings and revenue that topped Wall Street targets. Subscription-based annual recurring revenue for DT stock edged by views.

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ARR is a key financial metric for many software companies. Dynatrace slightly raised full year 2024 ARR guidance. On the stock market today, DT stock plunged 15.8% to near 51.

Waltham-Mass.-based Dynatrace reported earnings before the market open. For the quarter ending Dec. 31, Dynatrace earnings were 32 cents on an adjusted basis, up 28% from a year earlier. Revenue climbed 23% to $365 million, the company said.

Analysts had estimated profit of 28 cents on revenue of $357.6 million. Annual recurring revenue, or ARR, rose 23% to $1.425 billion, edging by estimates for $1.41 billion.

Dynatrace Stock: Revenue Guidance

For the current quarter ending in March, Dynatrace predicted earnings of 27 cents vs. estimates of 25 cents. The software maker forecast revenue in a range of $372 million to $377 million vs. estimates of $372.7 million.

Heading into the Dynatrace earnings report, the software stock had gained 9% in 2024 and 24% over the past year.

The software maker’s computer network monitoring tools measure and analyze the performance of business-critical applications. In the  “observability” market, Dynatrace and others also monitor application performance over cloud-computing infrastructure.

Also, Dynatrace owned a Relative Strength Rating of 89 out of a best-possible 99, according to IBD Stock Check-up.

Further, Dynatrace competes with Datadog (DDOG) and others. Earnings for DDOG stock are due on Feb. 15.

Datadog stock fell 1.6% in premarket trade.

Follow Reinhardt Krause on X, formerly called Twitter, @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.

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