Dynatrace (DT) Q4 2025 earnings summary

Executive summary

• Achieved strong Q4 and FY25 results, surpassing guidance on all top-line and profitability metrics, with $1.73B ARR and 17% year-over-year growth.

• Subscription revenue grew 20% year-over-year to $1.62B, comprising 95% of total revenue.

• Surpassed 4,000 customers and 5,000 employees; closed 15 deals over $1 million ACV in Q4 and expanded partner collaborations.

• Platform recognized as a leader in observability and AIOps by Gartner, Forrester, ISG, and GigaOm.

• Large and expanding total addressable market of $65B, including $51B in observability and $14B in security.

Financial highlights

• Q4 FY25 total revenue was $445M, up 19% year-over-year; subscription revenue was $424M, up 20%.

• FY25 total revenue reached $1.7B; subscription revenue $1.62B, both up 20%.

• FY25 non-GAAP operating margin was 29%; GAAP operating margin was 11%.

• FY25 non-GAAP net income was $422M ($1.39/share); GAAP net income was $1.59/share.

• Free cash flow for FY25 was $431M (25% of revenue); pre-tax free cash flow margin was 32%.

Outlook and guidance

• FY26 ARR guidance: $1.975B–$1.99B (13–15% growth); total revenue guidance: $1.95B–$1.965B (14–16% growth).

• FY26 non-GAAP operating income expected at $560M–$570M (29% margin); non-GAAP EPS $1.56–$1.59.

• Free cash flow projected at $505M–$515M (26% of revenue); pre-tax free cash flow margin to remain at 32%.

• Q1 FY26 revenue expected at $465M–$470M, up 16–18% year-over-year.

• Foreign exchange expected to provide a $20M tailwind to ARR and $17M to revenue in FY26.