Dynatrace, Inc. (DT) Q1 2024 Earnings Call Transcript

For the period ending June 30, 2023

August 02, 2023, 08:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Greetings, and welcome to the Dynatrace Fiscal First Quarter 2024 Earnings Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions]. As a reminder, this conference is being recorded.

It's now my pleasure to introduce your host, Noelle Faris, Vice President of Investor Relations. Thank you. Noelle, you may begin.

Noelle Faris

Good morning and thank you for joining Dynatrace’s first quarter and fiscal 2024 earnings conference call. Joining me today are Rick McConnell, Chief Executive Officer; and Jim Benson, Chief Financial Officer.

Before we get started, please note that today’s comments include forward-looking statements such as statements regarding revenue and earnings guidance and economic conditions. Actual results may differ materially from our expectations due to a number of risks and uncertainties discussed in Dynatrace’s SEC filings, including our most recent quarterly report on Form 10-Q that we filed earlier today. The forward-looking statements included in this call represent the company's views on August 2, 2023. We assume no obligation to update these statements as a result of new information, future events or circumstances.

Unless otherwise noted, the growth rates we discuss today are non-GAAP reflecting constant currency growth and per share amounts are on a diluted basis. We will also discuss other non-GAAP financial measures on today's call. We provide reconciliations between non-GAAP and GAAP measures in today's earnings press release and in the financial presentation slides posted in the Investor Relations section of our website.

And with that, let me turn the call over to our Chief Executive Officer, Rick McConnell. Rick?

Rick McConnell

Thanks, Noelle, and good morning, everyone. Thank you for joining us for today's call. We had a solid start to our fiscal year, exceeding the high end of our guidance across all metrics. ARR grew 25% year-over-year, subscription revenue increased 27% year-over-year in constant currency, and non-GAAP operating income was $92 million, or 28% of revenue. These results continue to demonstrate our ability to deliver a powerful combination of top line growth and profitability.

They are a testament to the criticality of observability and application security in the market and the significant value our platform provides to our customers, even as the economic environment continues to impact behind behavior. Jim will share more details about our Q1 performance in a moment. In the meantime, I'd like to share an update on the broader market outlook, customer wins and recent announcements.