Dynatrace's CrowdStrike deal lands a day before earnings, with the stock down 8.2% in two sessions
Forrester crowned Dynatrace and Datadog the only AIOps Leaders on October 30; two days later Dynatrace went live with a security distribution alliance, and the day after that it reports earnings with the stock already sliding.
Vincent Jiang · 3 min read
The timing is almost theatrical. On November 2, at Fal.Con Europe, CrowdStrike's−0.64% — CrowdStrike, down 0.64 percent today user conference in Barcelona, CrowdStrike and Dynatrace−1.79% — Dynatrace, down 1.79 percent today announced a strategic partnership with three live integrations connecting CrowdStrike's Falcon security platform to Dynatrace's observability and log management stack 1. Roughly 24 hours before Dynatrace reports fiscal second-quarter results before the open on November 3, followed by an investor day outlining a "Rule of 50" path to fiscal 2029, a SaaS rule of thumb where revenue growth plus free-cash-flow margin reaches 50 3.
Two leaders, two roads into security
Forrester's latest Wave ranking of AIOps platforms, AI for IT operations tools that monitor and fix enterprise systems, came out October 30 and scored ten vendors on 24 criteria, naming exactly two Leaders: Dynatrace and Datadog−5.14% — Datadog, down 5.14 percent today 2. Dynatrace took the highest Current Offering score, with top marks in 16 of 24 criteria including causal root-cause analysis and autonomous AI site reliability engineering; Datadog, a cloud monitoring and observability vendor, was credited with "a clear and credible transition from observability toward agentic operations," with security workloads built in 2.
Forrester named just two AIOps Leaders out of ten vendors
Data
| Value | |
|---|---|
| Leaders | 2 |
| Strong Performers | 5 |
| Contenders | 3 |
Dynatrace's answer is rented, not built
That is the fork. Datadog is building security into its own platform. Dynatrace, at least for now, is renting it: the CrowdStrike deal brings federated search across Dynatrace telemetry without moving data, unified incident response, and Bindplane log routing, with each company deploying the other's technology internally 1. CrowdStrike chief business officer Daniel Bernard called legacy SIEM, security information and event management, the log-analysis product category the deal attacks, "a tax on data" 1. No terms were disclosed, so the near-term benefit is distribution and co-selling, not booked revenue.
It is also Dynatrace's second distribution play in a week, after the verified Cursor plugin covered here on October 27, which strengthens the rented-channel read rather than repeating it.
The market is not paying for the trophy
The 8.2% two-session drop suggests what the market is trading is the software selloff and the earnings risk, not the trophy 34. Dynatrace closed October 28 at $57.69, down 5.40%, and slid another 3.0% on October 29 in a broad software selloff 34.
Inside the company, chief technology officer Bernd Greifeneder made seven open-market sales and zero purchases over six months, about 50,346 shares for roughly $2.88 million 3. Institutional money is split too: 329 institutional investors added DT shares in the most recent quarter while 304 trimmed their positions 3.
The print on November 3 decides it
Datadog does not report until November 4, and analysts there expect revenue up more than 30% to $1.15 billion 5. Dynatrace goes first, with less growth, a fresh alliance it cannot yet bill for, and an investor day promising fiscal 2029 discipline 3. One quarter, one presentation, and the rented channel either starts earning or stays a press release.
Dynatrace's revenue growth has fallen from 26% to 16% in three years
- Revenue growth
- Operating margin
Data
| Revenue growth | Operating margin | |
|---|---|---|
| Q3 '23 | 25.9% | 10% |
| Q4 '23 | 22.7% | 9.8% |
| Q1 '24 | 21.1% | 6.1% |
| Q2 '24 | 19.9% | 10.5% |
| Q3 '24 | 18.9% | 11.2% |
| Q4 '24 | 19.5% | 10.9% |
| Q1 '25 | 16.9% | 9.6% |
| Q2 '25 | 19.6% | 13.1% |
| Q3 '25 | 18.1% | 14.8% |
| Q4 '25 | 18.2% | 14.1% |
| Q1 '26 | 19.4% | 7% |
| Q2 '26 | 16.2% | 12.9% |
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