Analysis of Long-term (Investment) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
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Long-term Activity Ratios (Summary)
Datadog Inc., long-term (investment) activity ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Net fixed asset turnover | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset) | ||||||
| Total asset turnover | ||||||
| Equity turnover |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Net Fixed Asset Turnover
- There is a general declining trend in net fixed asset turnover from 12.79 in 2020 to 11.83 in 2024, with a peak at 13.69 in 2021. This indicates a gradual decrease in the efficiency with which the company utilizes its net fixed assets to generate revenue over the observed period.
- Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)
- The ratio increased from 5.75 in 2020 to a high of 7.87 in 2022, signifying improved utilization of fixed assets when considering leased assets. However, from 2022 onward, the ratio declines steadily to 6.72 in 2024, suggesting a reduction in turnover efficiency related to both owned and leased fixed assets in recent years.
- Total Asset Turnover
- Total asset turnover shows a rising trend from 0.32 in 2020 to 0.56 in 2022, reflecting enhanced efficiency in generating sales from overall assets. Nevertheless, there is a subsequent decrease to 0.46 by 2024, indicating some erosion in asset utilization efficiency after the initial improvement period.
- Equity Turnover
- Equity turnover improves significantly from 0.63 in 2020 to a peak of 1.19 in 2022, which suggests increased effectiveness in using shareholders’ equity to generate revenue. However, the ratio declines to 0.99 in 2024, pointing to a reduction in equity utilization efficiency after 2022 but still maintaining a higher level compared to 2020.
Net Fixed Asset Turnover
Datadog Inc., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | ||||||
| Property and equipment, net | ||||||
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | ||||||
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Accenture PLC | ||||||
| Adobe Inc. | ||||||
| Cadence Design Systems Inc. | ||||||
| CrowdStrike Holdings Inc. | ||||||
| Fair Isaac Corp. | ||||||
| International Business Machines Corp. | ||||||
| Intuit Inc. | ||||||
| Microsoft Corp. | ||||||
| Oracle Corp. | ||||||
| Palantir Technologies Inc. | ||||||
| Palo Alto Networks Inc. | ||||||
| Salesforce Inc. | ||||||
| ServiceNow Inc. | ||||||
| Synopsys Inc. | ||||||
| Workday Inc. | ||||||
| Net Fixed Asset Turnover, Sector | ||||||
| Software & Services | ||||||
| Net Fixed Asset Turnover, Industry | ||||||
| Information Technology | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Net fixed asset turnover = Revenue ÷ Property and equipment, net
= ÷ =
2 Click competitor name to see calculations.
- Revenue
- The revenue shows a consistent upward trend from 2020 to 2024. Starting at approximately $603 million in 2020, revenue increased to roughly $1.03 billion in 2021, followed by a substantial rise to about $1.68 billion in 2022. The growth continued through 2023 and 2024, reaching over $2.68 billion. This pattern indicates strong and sustained sales expansion over the analyzed period.
- Property and Equipment, Net
- Net property and equipment values have steadily increased each year, beginning at approximately $47 million in 2020 and growing to nearly $227 million by 2024. This upward movement suggests ongoing investment in fixed assets, reflecting capacity expansion or upgrades to support business growth.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio shows a gradual decline throughout the years. From 12.79 in 2020, it rose slightly to 13.69 in 2021 but then decreased each subsequent year to 13.36 in 2022, 12.38 in 2023, and 11.83 in 2024. This declining trend may indicate that the company is generating less revenue per dollar invested in fixed assets over time, potentially due to heavy asset investments outpacing revenue growth or changes in operational efficiency.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Datadog Inc., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | ||||||
| Property and equipment, net | ||||||
| Operating lease assets | ||||||
| Property and equipment, net (including operating lease, right-of-use asset) | ||||||
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset)1 | ||||||
| Benchmarks | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Competitors2 | ||||||
| Accenture PLC | ||||||
| Adobe Inc. | ||||||
| Cadence Design Systems Inc. | ||||||
| CrowdStrike Holdings Inc. | ||||||
| Fair Isaac Corp. | ||||||
| International Business Machines Corp. | ||||||
| Intuit Inc. | ||||||
| Microsoft Corp. | ||||||
| Oracle Corp. | ||||||
| Palantir Technologies Inc. | ||||||
| Palo Alto Networks Inc. | ||||||
| Salesforce Inc. | ||||||
| ServiceNow Inc. | ||||||
| Synopsys Inc. | ||||||
| Workday Inc. | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Software & Services | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Information Technology | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Revenue ÷ Property and equipment, net (including operating lease, right-of-use asset)
= ÷ =
2 Click competitor name to see calculations.
- Revenue
- The revenue exhibits a consistent and strong upward trend over the five-year period. It increased significantly from approximately $603 million in 2020 to about $2.68 billion in 2024. This represents an overall expansion in the company's business scale and market reach, with the largest absolute annual increase occurring between 2021 and 2022, followed by continued substantial growth through 2024.
- Property and equipment, net (including operating lease, right-of-use asset)
- The net value of property and equipment also shows a steady and sizable increase each year, rising from around $105 million in 2020 to nearly $400 million by the end of 2024. This growth reflects ongoing investments in fixed assets and leased assets, potentially supporting the company's capacity expansion and infrastructure enhancement aligned with its revenue growth.
- Net fixed asset turnover (including operating lease, right-of-use asset)
- The net fixed asset turnover ratio indicates the efficiency with which the company utilizes its fixed assets to generate revenue. Initially, this ratio improved from 5.75 in 2020 to a peak of 7.87 in 2022, suggesting enhanced asset utilization. However, starting in 2023, the ratio declined to 7.13 and further to 6.72 in 2024. This downward trend despite increasing asset base and revenue suggests a relative decrease in asset efficiency or that the pace of asset investment is outstripping revenue growth in the recent years.
- Overall Analysis
- The data indicates a phase of rapid growth in revenue supported by substantial investments in property and equipment. Initially, increasing asset turnover ratios imply effective scaling, but recent declines in this ratio point to a potential need to optimize asset utilization or re-examine asset investment strategies to maintain efficiency. The company is expanding its asset base materially, which aligns with the increasing revenues, but balancing this with maintaining or improving turnover rates will be crucial for sustained operational efficiency.
Total Asset Turnover
Datadog Inc., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | ||||||
| Total assets | ||||||
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | ||||||
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Accenture PLC | ||||||
| Adobe Inc. | ||||||
| Cadence Design Systems Inc. | ||||||
| CrowdStrike Holdings Inc. | ||||||
| Fair Isaac Corp. | ||||||
| International Business Machines Corp. | ||||||
| Intuit Inc. | ||||||
| Microsoft Corp. | ||||||
| Oracle Corp. | ||||||
| Palantir Technologies Inc. | ||||||
| Palo Alto Networks Inc. | ||||||
| Salesforce Inc. | ||||||
| ServiceNow Inc. | ||||||
| Synopsys Inc. | ||||||
| Workday Inc. | ||||||
| Total Asset Turnover, Sector | ||||||
| Software & Services | ||||||
| Total Asset Turnover, Industry | ||||||
| Information Technology | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Total asset turnover = Revenue ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
- Revenue
- The revenue demonstrates a consistent upward trajectory over the five-year period. Starting at approximately 603 million US dollars in 2020, the revenue nearly doubled to around 1.03 billion in 2021, then showed robust growth to 1.68 billion in 2022. This positive trend continued with a substantial increase to 2.13 billion in 2023 and further growth reaching roughly 2.68 billion by the end of 2024. The data indicates strong sales growth and expanding business operations year over year.
- Total assets
- Total assets also increased steadily throughout the period. Beginning at about 1.89 billion US dollars in 2020, the asset base expanded to 2.38 billion in 2021, further growing to 3 billion in 2022. Thereafter, the assets increased substantially to 3.94 billion by the end of 2023 and sharply rose to approximately 5.79 billion in 2024. This growth reflects significant investment in resources and possibly acquisitions or capital expenditure to support the expanding business.
- Total asset turnover
- The total asset turnover ratio showed improvement initially but then declined in the latter years. It rose from 0.32 in 2020 to 0.43 in 2021 and peaked at 0.56 in 2022, indicating more efficient use of assets to generate revenue during these years. However, after 2022, the ratio decreased to 0.54 in 2023 and further dropped to 0.46 in 2024. This decline may suggest that asset growth outpaced revenue growth in recent years, leading to less efficient asset utilization compared to the peak period.
- Overall Analysis
- The company experienced strong revenue growth accompanied by significant asset expansion over the five years. While the initial rise in total asset turnover indicates improving efficiency, the subsequent decline suggests that asset growth has started to outpace revenue generation, potentially highlighting a need to optimize asset utilization or reassess investment strategies to sustain operational efficiency.
Equity Turnover
Datadog Inc., equity turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | ||||||
| Stockholders’ equity | ||||||
| Long-term Activity Ratio | ||||||
| Equity turnover1 | ||||||
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Accenture PLC | ||||||
| Adobe Inc. | ||||||
| Cadence Design Systems Inc. | ||||||
| CrowdStrike Holdings Inc. | ||||||
| Fair Isaac Corp. | ||||||
| International Business Machines Corp. | ||||||
| Intuit Inc. | ||||||
| Microsoft Corp. | ||||||
| Oracle Corp. | ||||||
| Palantir Technologies Inc. | ||||||
| Palo Alto Networks Inc. | ||||||
| Salesforce Inc. | ||||||
| ServiceNow Inc. | ||||||
| Synopsys Inc. | ||||||
| Workday Inc. | ||||||
| Equity Turnover, Sector | ||||||
| Software & Services | ||||||
| Equity Turnover, Industry | ||||||
| Information Technology | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Equity turnover = Revenue ÷ Stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
- Revenue
- Revenue has demonstrated a consistent upward trajectory over the analyzed period. Starting at approximately $603 million in 2020, it increased significantly to about $1.03 billion in 2021, continued to grow to $1.68 billion in 2022, rose further to $2.13 billion in 2023, and reached $2.68 billion in 2024. This pattern indicates robust top-line growth, with the highest year-over-year increments observed in the earlier years, followed by sustained strong growth in later years.
- Stockholders’ Equity
- Stockholders’ equity also shows a strong increasing trend. From $957 million in 2020, equity grew moderately to $1.04 billion in 2021, then accelerated to $1.41 billion in 2022. Continuing this growth, it increased substantially to $2.03 billion in 2023 and further to $2.71 billion by 2024. The growth in equity aligns with the revenue increase, suggesting ongoing capitalization and retained earnings contributing to the company’s financial strength.
- Equity Turnover Ratio
- The equity turnover ratio increased from 0.63 in 2020 to a peak of 1.19 in 2022, indicating improving efficiency in generating revenue from equity. However, it then declined slightly to 1.05 in 2023 and further to 0.99 in 2024. Despite this recent decrease, the ratio remains higher than at the beginning of the period, reflecting generally improved utilization of equity to drive revenue, albeit with some moderation in efficiency gains in the latest years.