Datadog stock faces Q3 test as TD Cowen sees growth above guidance

Datadog is heading into its third-quarter report with elevated expectations after TD Cowen named the cloud monitoring and observability software company one of its top picks. In a report published Thursday, October 29, 2026, Investing.com said the bank expects revenue growth of approximately 35 percent, above Datadog's roughly 29 percent guidance.

TD Cowen expects growth in Datadog's core business to accelerate from the high-20 percent range to more than 30 percent. The assessment is based on artificial intelligence usage trends and customer spending intentions, while the company enters the quarter after second-quarter revenue increased 36 percent.

AI demand raises the bar

The broker's customer research produced its most positive feedback in three years of covering Datadog, according to the report. One customer indicated that LLM Observability already accounts for 15 percent of its spending and expects total spending to grow between 25 percent and 30 percent in 2027.

The second-quarter comparison also sets a demanding reference point. Datadog exceeded its 30 percent revenue-growth guidance in that period, while the company has already incorporated lower usage from its largest customer into its third-quarter outlook. TD Cowen considers that headwind largely reflected in current expectations and sees potential for stronger fourth-quarter guidance.

Investors await November 4

Datadog is scheduled to release third-quarter results before the market opens on Wednesday, November 4, 2026. The report will test whether broader customer demand and AI-related workloads can offset the reduction in usage by the large account and sustain the pace expected by analysts.

Datadog stock traded at 229.75 euros on Lang & Schwarz at 11:18 CET on Friday, October 30, 2026. Investors can follow the real-time quote of Datadog stock.

The S&P 500 remains the relevant U.S. market benchmark for Datadog investors.

More news and analyses on Datadog stock will track the earnings release and the company's next outlook.