Datadog Inc (DDOG)

Gross profit margin

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Gross profit	US$ in thousands	2,168,740	1,718,450	1,328,360	794,539	473,269
Revenue	US$ in thousands	2,684,280	2,128,360	1,675,100	1,028,780	603,466
Gross profit margin		80.79%	80.74%	79.30%	77.23%	78.43%

December 31, 2024 calculation

Gross profit margin = Gross profit ÷ Revenue
= $2,168,740K ÷ $2,684,280K
= 80.79%

The gross profit margin of Datadog Inc. has exhibited a generally upward trend over the period from December 31, 2020, to December 31, 2024. Starting at 78.43% in 2020, the margin experienced a slight decline in 2021 to 77.23%, indicating a minor compression in gross profitability during that year. However, from 2021 onward, there was a consistent improvement in the gross profit margin, reaching 79.30% in 2022. This upward trajectory continued through 2023, with the margin increasing to 80.74%, and persisted into 2024, reaching 80.79%.

The overall trajectory suggests that Datadog Inc. has succeeded in enhancing its gross profitability over this period. The incremental increases reflect improvements in gross profit relative to revenue, which could result from operational efficiencies, favorable sales mix, or effective cost control measures in cost of goods sold. The stability and gradual growth in the gross profit margin imply a positive outlook regarding the company's core profitability and potential scalability of its business model.