Dynatrace, Inc. (NYSE:DT) Q2 2025 Earnings Conference Call November 7, 2024 8:00 AM ET

Company Participants

Noelle Faris - Vice President, Investor Relations
Rick McConnell - Chief Executive Officer
Jim Benson - Chief Financial Officer

Conference Call Participants

Pinjalim Bora - JPMorgan
Sanjit Singh - Morgan Stanley
Jake Roberge - William Blair
Raimo Lenschow - Barclays
Brad Reback - Stifel
Andrew Sherman - TD Cowen
Howard Ma - Guggenheim Securities

Operator

Greetings. Welcome to the Dynatrace Fiscal Second Quarter 2025 Earnings Call. At this time, all participants will be in listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce Noelle Faris, Vice President of Investor Relations. Thank you. You may now begin.

Noelle Faris

Good morning, and thank you for joining Dynatrace's second quarter fiscal 2025 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, earnings guidance, and economic conditions. Actual results may differ materially from our expectations due to a number of risks factors 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 contained in this call represent the company's views on November 7, 2024. 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 rate, and per share amounts are on a diluted basis. We will also discuss other non-GAAP financial measures on today's call. To see reconciliations between non-GAAP and GAAP measures, please refer to today's earnings press release and supplemental presentation, which are both posted in the financial results section of our IR website.

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

Rick McConnell

Thanks, Noelle. Good morning, everyone. Thank you for joining us for today's call. Our second quarter performance is the result of the strength of our platform and ability to execute effectively in a dynamic market.

ARR grew 19% year-over-year. Subscription revenues increased 20% year-over-year and trailing 12-month free cash flow margin was 28%. We delivered a strong first half to the fiscal year, I believe the market is increasingly playing to our strengths in AI-driven observability, which we have been delivering for well over a decade, and our Q2 results offer a great proof point.