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Datadog, Inc.(DDOG)

F

Financial data as of Dec 31, 2025Stable · Technology

FCF Margin4.8%Free Cash Flow / Revenue
Cash Conversion—Operating CF / Net Income
Free Cash Flow$914.7M
Revenue$3.4B
Net Cash-$877.7MNet debt position
Debt / FCF7.8xElevated debt burden
Current Ratio3.38Adequate short-term liquidity
YoY FCF Growth+3.8%4 of 5 quarters positive

How This Grade Was Calculated

Base grade from FCF margin, adjusted by financial health factors

BaseF
→
-1High debt-to-FCF ratio (7.8x)
→
-0.5Highly volatile FCF (consistency: 0.85)
→
+0.25Solid revenue growth (29.2% YoY)
→
FinalF

Analysis Summary

Strengths

  • Strong liquidity (current ratio: 3.38)
  • Strong revenue growth (29.2% YoY)

Concerns

  • Low FCF margin (4.8%)
  • Heavy debt position ($0.9B net debt, 7.8x FCF)
  • High debt-to-FCF ratio (7.8x)
  • Highly volatile quarterly FCF
Heavy CapEx — Operating cash flow is strong (31% margin) but most is reinvestedCash conversion ratio unavailable or not meaningfulSBC-adjusted FCF used — $0.8B stock-based compensation (82% of reported FCF) subtracted

Financial Breakdown

Key financials compared side by side

Margin Composition

FCF Margin4.8%
Net Margin3.1%
Operating CF Margin30.6%
CapEx Ratio4.0%

Balance Sheet Health

Debt, liquidity, and leverage snapshot

Net Cash-$877.7MNet debt position
Debt / FCF7.8xElevated debt burden
Current Ratio3.38Strong liquidity
Debt / Equity0.34Low leverage

Quarterly FCF Trend

+3.8% YoYStable (+3.8%)

Free cash flow per quarter

Sector Comparison — Technology

FCF Margin ranked against sector peers

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Detailed Metrics

Company NameDatadog, Inc.
SectorTechnology
Free Cash Flow$914.7M
Revenue$3.4B
Net Income$107.7M
Operating Cash Flow$1.1B
Capital Expenditure$135.4M
FCF Margin4.8%
Cash Conversion Rate—
Net Margin3.1%
Total Debt$1.3B
Total Cash$401.3M
Net Cash-$877.7M
Current Ratio3.38
Debt / Equity0.34
Debt / FCF7.8x
YoY FCF Growth+3.8%
Positive Quarters4 of 5
Trend DirectionStable
Report DateDec 31, 2025
GradeF
Data SourceYahoo Finance