Dynatrace (DT) Q2 2026 Earnings
How Did DT Stock React to Q2 2026 Earnings?
S&P 500 over the same 30 days: +0.89%.
Did DT Beat Earnings? Q2 2026 Results
Yes. Dynatrace reported Q2 2026 earnings of $0.44 a share on Nov 5, 2025, beating the $0.41 consensus estimate by 7.5%. Revenue was $493.8M against a $487.3M estimate.
Dynatrace turned in a convincing second quarter of fiscal 2026, with both earnings and revenue landing ahead of Wall Street expectations as demand for AI-powered observability continued to build. The enterprise software company posted non-GAAP EPS of $0.44, beating the $0.41 consensus estimate by 7.53%, while revenue climbed 18.1% year-over-year to $493.85 million, edging past the $487.34 million consensus by 1.34%. The standout driver was accelerating deal momentum, with annual contract value from seven-figure deals growing 53% year-over-year, as large enterprises consolidated observability tooling onto the Dynatrace platform. Annual recurring revenue reached $1.90 billion, up 17% from a year ago, with 70% of that ARR now flowing through the company's flexible DPS licensing model. Confidence in the trajectory prompted management to raise full-year fiscal 2026 revenue guidance to $1.99 billion to $2.00 billion and lift non-GAAP EPS guidance to $1.62 to $1.64, while third-quarter revenue is expected in the range of $503 million to $508 million.
- Growing demand for end-to-end observability driven by large-scale tool consolidations
- 53% year-over-year growth in ACV from 7-figure deals
- DPS licensing model now at 50% of customer base and 70% of ARR
- Cloud and AI workload growth driving need for AI-powered observability
- Nearly all large deals leveraging end-to-end observability
“Our strong second quarter results were fueled by the growing demand for end-to-end observability driven by large-scale tool consolidations. As cloud and AI workloads grow rapidly, the need for an AI-powered observability platform is critical to managing the related complexity and scale. We believe Dynatrace's precise answers, advanced analytics, and deep intelligence uniquely position us to capitalize on the market opportunity ahead.”
Dynatrace CEO, on the earnings call
What Was Dynatrace's Outlook in Q2 2026?
For Q3 FY2026, Dynatrace guides total revenue of $503-$508 million (15%-16% growth as reported, 13%-14% constant currency), subscription revenue of $481-$486 million, non-GAAP operating income of $143-$148 million (28.5%-29% margin), and non-GAAP EPS of $0.40-$0.42. For full-year FY2026, the company raised guidance to: ARR of $2,010-$2,025 million (16%-17% growth), total revenue of $1,985-$1,995 million (17%-17.5% growth), subscription revenue of $1,898-$1,908 million, non-GAAP operating income of $571-$581 million (29% margin), non-GAAP EPS of $1.62-$1.64, and free cash flow of $505-$515 million (26% margin). Foreign exchange is expected to be a tailwind of approximately $38 million on ARR and $34 million on revenue for fiscal 2026.
DT YoY Financials
| Metric | Q2 2026 | Q2 2025 | Year over year |
|---|---|---|---|
| Revenue | $493.8M | $418.1M | +18.1% |
| Gross Profit | $404.1M | $340.3M | +18.7% |
| Operating Income | $73.0M | $47.0M | +55.2% |
| Net Income | $57.2M | $44.0M | +30.1% |
DT Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.