Dynatrace Gears Up for IPO

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Dynatrace Holdings has filed an amended S-1 form with the U.S. Securities and Exchange Commission (SEC) for its initial public offering (IPO). The company intends to price its 35.60 million shares in the range of $11 to $13, with an overallotment option for an additional 5.34 million shares. Note that selling shareholders are selling 1.60 million of the shares. At the maximum price, the entire offering is valued up to $532.2 million. The company intends to list its shares on the New York Stock Exchange under the symbol DT.

The underwriters for the offering are Goldman Sachs, JPMorgan, Citigroup, Barclays, Jefferies, RBC Capital Markets, UBS Bank, KeyBanc Capital Markets, William Blair, Canaccord Genuity, JMP Securities and Macquarie.

This firm offers the market-leading software intelligence platform, purpose-built for the enterprise cloud. As enterprises embrace the cloud to effect their digital transformation, Dynatrace’s all-in-one intelligence platform is designed to address the growing complexity faced by technology and digital business teams.

The platform utilizes artificial intelligence at its core and advanced automation to provide answers, not just data, about the performance of applications, the underlying hybrid cloud infrastructure, and the experience of customers’ users. Dynatrace designed the software intelligence platform to allow its customers to modernize and automate IT operations, develop and release high-quality software faster and improve user experiences for better business outcomes.

In the filing, the firm described its finances as follows:

Our subscription revenue for the years ended March 31, 2017, 2018, and 2019 was $232.8 million, $257.6 million, and $349.8 million, respectively, representing 57%, 65%, and 81%, respectively, of total revenue and year-over-year growth of 11% and 36%. Our total revenue for the years ended March 31, 2017, 2018, and 2019 was $406.4 million, $398.0 million, and $431.0 million, respectively, representing a year-over-year decline of 2% and a year-over-year increase of 8%.

We had net income (loss) of $0.8 million, $9.2 million, and $(116.2) million for the years ended March 31, 2017, 2018, and 2019, respectively. Our adjusted EBITDA for the years ended March 31, 2017, 2018, and 2019 was $108.3 million, $92.8 million, and $92.9 million, respectively, representing 26.6%, 23.3%, and 21.5%, respectively, of total revenue.

The company intends to use the net proceeds from this offering to repay debt as well as for working capital and general corporate purposes.


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