Shares of Datadog Inc (NASDAQ:DDOG) rallied in early trading on Thursday after the company reported upbeat first-quarter results.

Here are the key analyst insights:

• Guggenheim Securities analyst Howard Ma maintained a Buy rating, while raising the price target from $175 to $225.
• KeyBanc Capital Markets analyst Eric Heath reiterated an Overweight rating, while lifting the price target from $155 to $225.
• Needham analyst Mike Cikos reaffirmed a Buy rating, while taking the price target higher from $155 to $225.
• Rosenblatt Securities analyst Blair Abernethy maintained a Buy rating, while raising the price target from $178 to $220.

Check out other analyst stock ratings.

Guggenheim Securities: Datadog's total revenues grew 32% year-on-year to $1.006 billion. They topped the consensus of $960 million, with management citing "broad-based strength.” Ma estimates total AI-native revenue at $133 million for the quarter, including around $88 million from OpenAI, up more than 90% year-on-year, and $45 million from other AI natives, up 240%.

Datadog reported record sequential ARR addition, with management reporting a seven-figure and an eight-figure annualized AI deal with two of the world’s largest technology companies, the analyst stated. "We see Datadog ultimately growing 31% this year, including at least 34% in 2Q," he further wrote.

KeyBanc Capital Markets: Datadog generated strong revenue acceleration driven by both AI-native and non-AI customers, Heath said. He cited three main positives:

• The company's increasing relevance with AI-natives customers
• The world's most advanced AI companies are choosing Datadog instead of developing solutions in-house or moving to a low-cost competitor
• AI training workloads being an additional market opportunity
• 3x sequential growth in spans from AI apps indicates that AI is moving into production with traditional enterprise and is being monitored

Management guided to second-quarter revenues of $1.07-$1.08 billion, higher than consensus of $993 million and representing 7% sequential growth "well above the typical 3% q/q growth guide," the analyst further wrote.

Needham: Datadog's second-quarter guidance reflects around 30% year-on-year revenue growth at the midpoint, suggesting "sustained trends and strong bookings," Cikos said. Highlighting strength among both AI-native and non-AI customers, the analyst mentioned that:

• Datadog won two large contracts during the quarter with the AI research divisions at two of the world’s leading technology companies. The AI-native customer cohort includes 22 customers who spend over $1 million annually and 5 who spend over $10 million annually.
• Datadog’s core non-AI customer cohort re-accelerated to mid-20% year-on-year growth.

Rosenblatt Securities: Datadog's bookings grew 29% year-on-year to $1.025 billion. The company signed both large and small deals during the quarter, Abernethy said. The strong momentum continued in April. The company's second-quarter revenue outlook suggested around 30% year-on-year growth, he added.

The company guided to 2026 revenue growth guidance of 25%-27%, higher than consensus of 20%, but implying a significant slowdown in the second half of the year, the analyst stated. The guidance appears "somewhat conservative, in our view," he further wrote.

BofA Securities: Datadog reported strong first-quarter results and announced a second-quarter revenue growth outlook that "is equally impressive," Ikeda said. The recent outperformance suggests that revenue growth acceleration could continue, he added.

"Datadog is executing very well and end-market demand is inflecting," the analyst wrote.

DDOG Price Action: Shares of Datadog had risen by 3.12% to $194.62 at the time of publication on Friday.