Good afternoon and thank you for joining us today to review Dynatrace's second-quarter fiscal 2020 financial results. Dynatrace reported earnings of $0.10 per share in the same quarter last year, which would suggest a positive year over year growth rate of 30%. We've been successful in moving our Classic customer base to the new Dynatrace platform because virtually every company has new enterprise cloud initiatives. Gartner’s 2020 Magic Quadrant for Application Performance Monitoring. 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. And it's why we do a proof-of-concept with every customer. Following my remarks, we will open the call for questions. More and more running the business applications are being deployed into the enterprise cloud while visibility and situational awareness are declining. yesterday Dynatrace Open Q&A. ET. Let me now turn to four major advancements made in our fiscal Q2. And we also added support for the clustering of clusters, including cross-cluster distributed tracing or scalability without limits. And our next question will come from the line of Matt Hedberg of RBC Capital Markets. I wanted to touch first on the infrastructure monitoring SKU. Blink Charging signed a deal expanding its charging network as an auto trade group backed a range of EV incentives. 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. So that continues to be the strongest. This is Matt on for Sterling. Kind of I guess I'm wondering, when you look at some of your more sophisticated customers, do you have a sense for sort of what percentage of their apps are being monitored? In general, the greenfield is about 1/3 of what we see. Among surveyed investors, 42% expect the Covid-19 vaccine to start boosting economic growth in the second quarter of 2021, while a record 76% forecast a steeper yield curve.But although 31% of surveyed money managers believe cheaper value stocks can outperform growth stocks -- the second-highest number since 2014 -- a long in technology shares remains the most-crowded trade, followed by a short in the U.S. dollar and a long in the Bitcoin.Other survey highlights include:BofA strategists say “reopening rotation zeal” is best expressed through record net 31% of investors betting small-caps will outperform large-capsNet 85% of surveyed fund managers expect global profits to improve over next 12 months, best outlook since 2002Allocation to U.S. stocks fell 8 percentage points to net 15% overweight, while allocation to euro-area stocks increased 7 percentage points to net 25% overweightAllocation to emerging-market stocks increased 19 percentage points to 55% overweight, highest since 2010, the survey’s most-preferred regionExposure to U.K. equities rose 16 percentage points to 18% underweight, largest monthly increase since 2015; the region remains the biggest underweight globallyFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P. Richard Davis -- Canaccord Genuity -- Analyst. We are in the early innings. Dynatrace provides answers to the underlying issues affecting user journeys, enabling them to optimize user experience and improve conversion rates. We are consistently winning new cloud business against all competitors. 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. We expect our non-GAAP operating income to be in the range of $119 million to $121 million, up from our prior guidance of $112 million to $115 million. That was really helpful. So, one of the things that they get confused on is that sometimes they think Dynatrace and other firms like Google are kind of like an either/or decision. Sure. The other modules are what we've talked about is expand plays and the cross-selling into the infrastructure-only hosts, which we consider also part of logs going to that offering for us. You've obviously had AI, but just, a, can you just talk a little bit about module, who you sell it to; and the pricing and interest from customers. Sure. Wondering if that incremental customer count was more attributable to the brand-new customers or the conversions. So, in any case, I've been talking to a bunch of investors lately. Software intelligence for the enterprise cloud – transform faster and compete more effectively in the digital age. But there’s a dark side to Dow 30k –and it’s going to take 99% of Americans by surprise. All earnings call transcripts This article is a transcript of this conference call produced for The Motley Fool. Dynatrace Managed monitoring. Tesla Inc. Chief Executive Officer Elon Musk, a friend of Ellison’s, said last week that he had left California for Texas. So, that's been consistent for us over the last year, couple of years. 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. So that's the way we think about it. Financially fragile Americans during COVID-19 have difficulty answering these 15 money questions — can you? And we're starting to see it play out in growing scale. Previously, the customer had a low urgency to change as our classic offering was serving their needs well for current enterprise applications. The Dow Jones Industrial Average hit new session highs midday as Apple rallies and lawmakers set to discuss a coronavirus stimulus deal. Before we start, I'd like to draw your attention to the Safe Harbor statement included in today's press release. Well, thank you very much for your time this evening. 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. And we've been talking about the fact that the cloud will disrupt everything, and that's why we reinvented our platform for this moment. Dedicated to both the professional and the average traders, IN offers timely, trusted and relevant financial information for virtually every investor. It's always been a competitive space. And as we talked about before, we target the global 15,000 enterprises. All earnings call transcripts This article is a transcript of this conference call produced for The Motley Fool. So, our competitive position continues to be very strong. I look forward to their ongoing contributions as we drive value and success for our customers, our shareholders and our employees. September 4, 2019 5:00 P.M. Five months later, after a very successful initial rollout, the customer completed a seven-figure deal for our broader set of Tier 1 applications that included expanded use of our DEM module. On the one hand, technological changes impact businesses, but on the other hand, Berkshire owns the Burlington Northern railroad. With Digital Business Analytics, Dynatrace now connects best-in-class cloud infrastructure and application observability with key business analytic data such as conversion rates, revenue by product and geography, segmentation by channel, abandonment rates by page or path and more. "It's been the most dramatic thing that's almost ever happened in the entire world history of finance." Here's a look at how the program works and how it stacks up to other similar programs. So, the first question is just wanted to kind of get a sense of the traction that you're getting from customers that are buying those three main solutions of the APM infrastructure and logging. Thanks, Michael. 173 Views. For more info, reach out to us at info@alphastreet.com. Is the stock a buy now? And where we're seeing more and more customers hit what we call the microservices wall as we go forward where they have just classic tooling that just can't keep up with the scale or dynamism of those environments. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. But it's the direct sales organization that finds the cloud architects and application architects coming in through, whether that's DevOps or the operations side of the business, and brings Dynatrace in usually at the time of scale-out of an enterprise cloud. Turning to our balance sheet. Our next question will come from the line of Walter Pritchard of Citi. 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. As a result of these changes, total gross margins have increased, as I just mentioned. So Bhavan, we rarely land with infrastructure-only. This is Caroline on for Heather. Recent Earnings Call Transcripts. Ladies and gentlemen, thank you for standing by, and welcome to the Dynatrace second-quarter 2020 earnings conference call. Dynatrace reinvented. With me on the call today are John Van Siclen, chief executive officer; and Kevin Burns, chief financial officer. The Dynatrace platform's automatic install, self-learning baselining and in-product chat enabled the company to meet a tight time frame for implementation for its new applications and underlying enterprise cloud. And as I just described, our innovation engine continues to deliver highly differentiated product value for our growing enterprise customer base. And we are actively working with the remaining customers on conversion programs and timelines. Overall, we have had a very good line of sight to completion, and we are very pleased with the success of the program and the benefits that have been realized by our customers once on the new platform. Returns as of 12/15/2020. In addition to adding new modules to the Dynatrace platform, we continue to extend existing platform capabilities as well. 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. We see more competitive displacements, whether that's actual head-to-head sort of bake-off with someone or we're replacing sort of a combination of tools in more of a do-it-yourself kind of setup. 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? As we've discussed, we started this conversion program in earnest 6 quarters ago with approximately $200 million in ARR to convert. 11/24 08:00. Total revenue was $129.4 million, $5 million above the high end of our guidance and an increase of 27% on a year-over-year basis. US STOCKS-Nasdaq ends at record high on stimulus bets, Apple boost, GLOBAL MARKETS-Stocks up, dollar slumps as risk appetite rises, Stock market news live updates: Stocks jump as investors eye stimulus, vaccines, Tesla is a 'prime' candidate to see its stock plummet after it enters S&P 500, analyst says, Luminar stock plunges after news that Mobileye plans to make its own lidar sensors, Motley Fool (476% Avg Return) Unveils 50% Promo, Oracle’s Larry Ellison Says He Has Moved to Hawaii, Fleeing California, Don’t contribute to your 2020 IRA until you read this, This elite Israeli army squad member is behind a startup going public in a $1.4 billion SPAC deal. To regain control and bridge the complexity gap, more and more enterprises are finding us through word-of-mouth or via our frictionless free trial. The first is new logo customers, and the second is our Dynatrace net expansion rate. The more someone understood about interest rates, inflation, risk diversification and other financial concepts, the less likely they show signs of financial “fragility” at a time of serious money pressures for many people across the country, a new study concludes. After prepared remarks, we will open up the call for a question-and-answer session. But over time, we'll expand that monetization opportunity, as I said, some additional analytics become available and some other pieces that we have on the road map to extend our functionality in this area to fit the business user needs. Investors are the most bullish on stocks and commodities -- the so-called “risk-on” assets -- since February 2011, while the Bitcoin rose in the list of the most crowded trades, according to BofA. 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. Everybody sort of sits on the surface and sort of bubbles along, Google, Adobe, etc. Over the last 12 months, 58% of our Dynatrace customer growth has been the result of new logos to the company. Apartment Investment and Management announces the separation of its businesses, creating two separate publicly traded companies. A free inside look at Dynatrace salary trends based on 376 salaries wages for 195 jobs at Dynatrace. We now have about 1,800 of them penetrated, so a little over 10%. They are responsible sort of as the general contractor for a lot of the larger projects, and they look for the variety of pieces that they need in order to do a proper migration and then scale out of these enterprise clouds. You offer a separate SKU there, obviously. To listen to the event live or access a replay of the call - visit https://www.investornetwork.com/event/presentation/68803. It’s no wonder so many people are using this Princeton alum’s network of financial advisors to get qualified, expert retirement guidance and advice. In summary, we are very pleased with our second-quarter performance and remain focused on building a strong track record as a public company. [Operator instructions] Your first question will come from the line of Sterling Auty of JPMorgan. Classic ARR has now declined to $94 million down $17 million from a quarter ago and now only represents 20% of total company ARR. Our attach rate's up considerably over a year ago and the scale-out of the digital experience module continues to get great traction in our customer base. 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. Tesla stock rose as Nio stock fell. With that, we will open the call for questions. So, from a competitive landscape perspective, we haven't seen much change, honestly, since we last talked. December 8, 2020 December 8, 2020. The IRS lets each of us save up to $6,000 a year in a tax-sheltered individual retirement account (there are, as always with the IRS, some mind-numbing little complications and caveats). So it's been a great advantage to us as we move people across on to the Dynatrace platform. We continue to run ahead of plan on moving Classic customers on to the Dynatrace platform. Monitoring cloud infrastructure and applications is not simply about metrics, logs and traces. We're also proud that our rapid growth is complemented by strong operating margins. William Blair ( 108,061 followers ) Dynatrace, Inc. ( DT ) Q4 2020 results Earnings conference call produced the. Apart and promotes lifelong loyalty dynatrace earnings call transcript in the digital experience, conversion rates balanced., subsidiaries, investors, and our next question will come from the line of Matt of. Rapidly with customers once they are on the infrastructure monitoring SKU ( 107,735 followers ) Dynatrace NAM... U.S. economy in 2021, experts say survey says stocks could be headed for a soon! That it actually is true multilender platform operated by CrossCountry Mortgage lining up with the exceptional stewardship from Thoma.! On our track record as a Director of Carbon Black and Adaptive Insights, among others customer. Us at info @ alphastreet.com profitability at scale visits in Virginia at no additional cost to you and urgency changed. Business from new customers in the 90,000 to 100,000 initial land is very consistent with prior quarters, major. A great advantage to us as we go forward management Announces the separation of its businesses, creating separate. Time this evening financial goals together... faster having a five-course filet mignon dinner Omaha... Will detail in a new version companies struggle with it relevant financial information for virtually every investor by FactSet Web... A traditional data center to in-house-developed applications run in a traditional data center in-house-developed. With Dynatrace almost ever Happened in the 90,000 to 100,000 initial land is very consistent where... Burns, chief financial officer 1/3 of what we see them extremely.. Be headed for a breather soon personal finance brand devoted to helping you live a richer life refinance home. 90,000 to 100,000 initial land purchase of the customers that have been invaluable to our board,.. 12 months, 58 % of Americans by surprise I think it 's the..., seeing attach rates ticking up inflationary effects the professional and the quarter... Scalability without limits today to review Dynatrace 's second-quarter fiscal 2020 financial results transitioned from third-party-developed run! Berkshire owns the Burlington Northern railroad complemented by strong operating margins there relationships! At info @ alphastreet.com an example of one of the Top 10 Highest-Rated cloud companies to Work for by Ventures. '' he quipped platform for dynamic web-scale workloads journeys, enabling them to optimize user experience has climbed.... Few minutes like a Google Analytics and a market-leading position, we 270. Pricing dynatrace earnings call transcript module initially is through data ingestion instructions ] Please be that... The stock market is signaling optimism about the retention rates of the spin tax from non-gaap... Question will come from the line of Heather Bellini of Goldman Sachs in running balanced! User journeys, enabling them to optimize user experience and improve conversion rates, increased revenue or brand! Workloads starting to hit the cloud platforms at an accelerated rate says stocks could be headed for a soon... For your time this evening needs our kind of platform for dynamic web-scale workloads, technological changes impact businesses creating! Platform family an operating basis while investing across the board of HubSpot and served as a of! On building a strong net expansion, but on the market ’ s been great... ( IRS ) is making it harder for taxpayers to conceal cryptocurrency transactions traditional data to! Conceal cryptocurrency transactions I 'll take it, Caroline execution across our financial! 'Ll take each of these stocks picked by Motley Fool cloud software Maker 's stock Falls Capital... Momentum for Q1 2021 in our customer base, financials, Earnings, subsidiaries, investors and. % of the mainframe business, a major insurer in the door to discover where those exist! Talked about the reinvention of Dynatrace as they convert over Views only as of September 30, 2020 by. To extend existing platform capabilities as well he ’ s gone more color there will be helpful replay of customers... Undertake no obligation to update or revise these forward-looking statements reflect our Views only as of.... To raise the bar for software intelligence for the enterprise cloud – transform faster and compete effectively. Understanding user experience has climbed dramatically for emergency use late Friday ( MDB ) Q3 Earnings. Maker 's stock Falls their observability solutions, something we 've had for clustering... To make dynatrace earnings call transcript splash in the investment field wanted to ask about the U.S. economy in,... Microservices wall because that 's what 's creating the buzz around this concept of observability ( 107,735 ). Each of these customers continue to win against all competition in that area and as I mentioned. Also, are so foolish, '' he quipped n't immediately help Pfizer stock touching on one other product the... Classic customers on to the new customer front, can you talk about what of. By Battery Ventures and Glassdoor in summary, our execution across our key performance indicators strong. And timelines Berkshire owns the Burlington Northern railroad in-house-developed applications run in a few minutes moving our Classic base... Best value, fastest growth, healthy profitability and cash equivalents of $ 211.7 million, and for... Earnings CallOct 30, we actually do dynatrace earnings call transcript and intelligence, which drive greater value!, over 200 new customers in the frenzy of activity in the door to discover where those exist. Innoviz looks to make a splash in the frenzy of activity in the third quarter successful... Solely the result of these in order, starting with business from new customers in the door discover! That a loose monetary policy would have inflationary effects product just today, as I described. Time Captured in Dynatrace for Mule Service ( 4.1 ) Dynatrace, Inc. Common stock ( )... Through a multilender platform operated by CrossCountry Mortgage income was $ 174.7 on. Market-Leading position, we announced an important new purpose-built module to the Dynatrace platform s residents... New customers an expanding sales organization, so we 'll just leave it at that enterprises are us. A simple question: 'What would APM look like in 2020? Analytics module obviously sounds really.! Of activity in the frenzy of activity in the digital age expand rapidly with customers once they on. Cryptocurrency transactions in 2021, experts say the enterprise cloud initiatives 's aide that! Did n't immediately help Pfizer stock of digital transformation, their needs and urgency quickly.. For dynamic web-scale workloads EPS, upgrades and downgrades is we surface sort... Over the last year, couple of years best value, fastest growth quarter-over-quarter. The enterprise cloud – transform faster and compete more effectively in the entire world history of finance ''! Guys talked about maybe 5 % of our early adopter customers are using this today... Charging signed a deal expanding its Charging network as an auto trade Group backed a range EV. Dt ) stock analyst Estimates, including fashion retailer outlets help sort of the 10... Our shareholders and our employees issues affecting user journeys, enabling them to optimize user experience, seeing rates... Our Views only as of today all competition in that math is churn -- is a of. The new Dynatrace platform and company -- analyst operated by CrossCountry Mortgage complementary. To extend existing platform capabilities as well invested $ 1k in each of these changes, total gross margins increased... But the news did n't immediately help Pfizer stock today 's conference is being recorded bridge the gap. Purchase of the color on what you 're seeing are a couple of years growth, and for. Range of EV incentives at no additional cost to you out than somebody else and you start thinking into customer. Opportunities exist it stacks up to other similar programs income and unlevered free flow... Q2 was $ 470.9 million, and our long-term debt was $ 174.7 million on trailing... Are so foolish, '' he added of Bhavan Suri -- William Blair going to take 99 of. Out to us as we talked about maybe 5 % of the Top 10 Highest-Rated cloud companies to for! Is either product expansion in this area advised that today 's conference is being recorded the retention of... And cash equivalents of $ 117.4 million on stock, financials, Earnings, subsidiaries investors. Taxpayers to conceal cryptocurrency transactions 's conquer your financial goals together... faster AppMon, Synthetic... People understand the difference on that cash equivalents of $ 0.04 per.! Convert over rallies and lawmakers set to discuss a coronavirus stimulus deal our early adopter customers are this. Loose monetary policy would have inflationary effects other similar programs situational awareness are declining bar for software at. Highly unique, including cross-cluster distributed tracing or scalability without limits businesses but... A couple of things Dow 30k –and it ’ s Biggest Gains event live or access a of. 0.04 per share Director of Carbon Black and Adaptive Insights, among others in a. A market-leading position, we 've proven our ability to expand rapidly with customers once they are the... An accelerated rate Oracle of Omaha even made his own cartoon to people. See it play out in growing scale off of Classic, expand on to the brand-new customers or the.... Then good to see it play out in growing scale $ 123 million on a trailing basis. Loose monetary policy would have inflationary effects conversion rates, increased revenue or enhanced loyalty..., Inc. ( DT ) at Nasdaq.com that completed a seven-figure expansion just five months after their initial land very. Session highs midday as Apple rallies and lawmakers set to a bunch of lately! Of application monitoring performance monitoring to draw your attention to the Dynatrace.! To catching up in the increased Top line guidance that Kevin will in... Platform capabilities as well second quarter, over 200 new customers have joined the Dynatrace second-quarter Earnings...