Dynatrace | 8-K: FY2027 Q1 Revenue Beats Estimate at USD 554.55 M

Revenue: As of FY2027 Q1, the actual value is USD 554.55 M, beating the estimate of USD 549.44 M.

EPS: As of FY2027 Q1, the actual value is USD 0.12, missing the estimate of USD 0.1973.

EBIT: As of FY2027 Q1, the actual value is USD 71.48 M.

Annual Recurring Revenue (ARR)

• Total ARR for Dynatrace, Inc. was $2,135,982 thousand, an increase of 17% year-over-year on both an as-reported and constant currency basis.
• Organic net new ARR growth was 41%.

Revenue

• Total revenue reached $554,548 thousand, up 16% year-over-year, or 15% on a constant currency basis.
• Subscription revenue was $530,255 thousand, marking a 16% year-over-year increase, or 15% on a constant currency basis.
• Service revenue was $24,293 thousand, compared to $19,842 thousand in the prior year.

GAAP Operational Metrics

• GAAP income from operations was $71,476 thousand, compared to $62,338 thousand in the prior year.
• GAAP operating margin remained consistent at 13% for both periods.
• GAAP net income was $36,651 thousand, down from $47,955 thousand in the prior year.
• Gross profit was $451,095 thousand, up from $392,140 thousand in the prior year.
• Total cost of revenue was $103,453 thousand, compared to $85,209 thousand in the prior year.
• Total operating expenses were $379,619 thousand, up from $329,802 thousand in the prior year.

Non-GAAP Operational Metrics

• Non-GAAP income from operations was $161,600 thousand, an increase from $143,106 thousand in the prior year.
• Non-GAAP operating margin was 29%, compared to 30% in the prior year.
• Non-GAAP net income was $139,721 thousand, an increase from $126,277 thousand in the prior year.
• Non-GAAP gross profit was $463,550 thousand, compared to $404,242 thousand in the prior year.
• Non-GAAP gross margin was 84%, compared to 85% in the prior year.

Cash Flow

• Net cash provided by operating activities was $306,240 thousand, up from $269,692 thousand in the prior year.
• Net cash provided by operating activities as a percent of revenue was 55%, compared to 56% in the prior year.
• Adjusted free cash flow was $309,177 thousand, an increase from $262,157 thousand in the prior year.
• Adjusted free cash flow margin was 56%, compared to 55% in the prior year.
• Net cash used in investing activities was - $72,909 thousand, compared to - $8,448 thousand in the prior year.
• Net cash used in financing activities was - $269,982 thousand, compared to - $43,854 thousand in the prior year.

Other Key Metrics

• Dynatrace, Inc. repurchased $275 million of its stock, acquiring 7.1 million shares at an average price of $38.88 during the first quarter of fiscal 2027.
• Annualized logs consumption nearly doubled in the last two quarters to $200 million, growing well over 100% year-over-year.

Financial Outlook (Guidance as of August 5, 2026)

Dynatrace, Inc. expects full-year fiscal 2027 ARR to range between $2,359 million and $2,379 million, with total revenue projected at $2,306 million to $2,320 million, and non-GAAP income from operations anticipated between $682 million and $690 million. Foreign exchange is expected to be a headwind of approximately $14 million on ARR and $4 million on revenue for fiscal 2027. For the second quarter of fiscal 2027, total revenue is expected to be $565 million to $570 million, with non-GAAP income from operations projected at $166 million to $170 million.