Dynatrace Clocks 29% Revenue Growth In Q3 Backed By Subscriber Additions; Boosts FY23 Outlook

Dynatrace, Inc DT reported third-quarter FY23 revenue growth of 29% year-on-year to $297.46 million (CC), beating the consensus of $284.70 million.
Adjusted ARR increased 29% Y/Y. Revenues from Subscription rose 29% Y/Y to $279.15 million (CC).
Margins: The non-GAAP operating margin expanded by 200 basis points to 27%.
Non-GAAP EPS of $0.25 beat the consensus of $0.21.
Dynatrace generated $57.6 million in free cash flow during the quarter. It held $422.5 million in cash and equivalents.
CEO Rick McConnell said, "The secular tailwinds of digital transformation and particularly cloud modernization are driving an explosion in data, making observability increasingly mandatory across all industries as companies look to realize greater value from their IT spend."
Outlook: Dynatrace sees Q4 FY23 revenue of $304 million- $307 million (consensus $291.83 million).
Dynatrace sees non-GAAP EPS of $0.22 - $0.23 (consensus $0.21).
For FY23, Dynatrace raised total revenue from $1.119 billion - $1.126 billion to $1.148 billion - $1.151 billion and above the consensus of $1.12 billion.
Dynatrace raised non-GAAP EPS from $0.81 - $0.83 to $0.87 - $0.88 and above the consensus of $0.82.
Price Action: DT shares closed higher by 1.05% at $38.43 on Tuesday.
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