Datadog vs Elastic: Revenue, Profit and Business Model
Datadog reported $3.4B of revenue in FY2025 and $107.7M of net income. Elastic reported $1.7B of revenue in FY2026 and $367.8M of net income.
Latest financial snapshot
Financial summary
Datadog
Datadog grew revenue from $1.03 billion in 2021 to $3.43 billion in 2025. In 2025 it generated $1.05 billion of operating cash flow and $915 million of free cash flow, while GAAP net income was a much smaller $107.7 million because of heavy stock-based compensation and R&D spending. Growth accelerated in 2026: Q1 revenue was $1.006 billion (+32%) with $52.6 million of GAAP net income, and Q2 revenue was $1.12 billion (+36%) with $279 million of free cash flow. After Q2, management guided to full-year 2026 revenue of about $4.45-4.47 billion, roughly 30% growth. GAAP operating income stays near break-even, while non-GAAP operating margin runs in the low 20s.
Elastic
Elastic's revenue grew from $862 million in fiscal 2022 to $1.739 billion in fiscal 2026. FY2026 subscription revenue was $1.634 billion (+18%), and sales-led subscription revenue, which excludes monthly self-serve cloud, was $1.438 billion (+20%). Non-GAAP operating income reached $285 million (16.4% margin) and adjusted free cash flow $346 million (20% margin), though GAAP operating loss was $33 million. GAAP net income of $367.8 million was lifted by a fourth-quarter income tax benefit, since the company's operations were not profitable on a GAAP basis. In Q1 FY2027 (ended July 31, 2026) revenue rose 15% to $478 million, cRPO grew 21% to $1.153 billion, and Elastic raised FY2027 revenue guidance to $1.998-$2.010 billion.
Revenue and profit by year
Datadog
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2025 | $3.4B | $107.7M | 3.1% | +27.7% | Source |
| FY2024 | $2.7B | $183.7M | 6.8% | +26.1% | Source |
| FY2023 | $2.1B | $48.6M | 2.3% | +27.1% | Source |
| FY2022 | $1.7B | -$50.2M | -3.0% | +62.8% | Source |
| FY2021 | $1B | -$20.9M | -2.0% | — | Source |
Elastic
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2026 | $1.7B | $367.8M | 21.1% | +17.3% | Source |
| FY2025 | $1.5B | -$108.1M | -7.3% | +17.0% | Source |
| FY2024 | $1.3B | $61.7M | 4.9% | +18.6% | Source |
| FY2023 | $1.1B | -$236.2M | -22.1% | +24.0% | Source |
| FY2022 | $862.4M | -$203.8M | -23.6% | — | Source |
Where the revenue comes from
Datadog
- Subscription RevenuePrimary
Recurring contracts priced around usage, monitored hosts, telemetry ingestion, events, seats, and purchased modules.
- Professional Services and OtherSmall
Implementation, training, and related services are minor compared with subscription revenue.
Elastic
- Subscriptions (Elastic Cloud and self-managed)~94%
FY2026 subscription revenue of $1.634 billion from managed Elastic Cloud on AWS, Azure and Google Cloud and from self-managed licenses with support.
- Professional services~6%
Consulting, implementation and training, about $105 million in FY2026.
Business model and strategy
Datadog
How it makes money
Datadog runs a B2B subscription model. Customers pay based on usage and the products they turn on: monitored hosts and containers, ingested and indexed log volume, traced requests, user sessions, security workloads, and similar units. Contracts are sold self-serve, through a direct sales team, and through cloud marketplaces such as AWS Marketplace. Revenue grows in two ways.
Growth strategy
Datadog's growth plan has three parts. First, sell more products to existing customers across observability, security, and developer workflows. Second, win larger enterprise and AI-native customers that run very large workloads.
Competitive advantage
Datadog's main edge is breadth on one shared data platform. Metrics, traces, logs, user sessions, security signals and cost data are stored and correlated together, so a slow page can be traced from the browser session to the service, the host and the log line without switching tools.
Elastic
How it makes money
Elastic is a B2B software company with an open-core model. Its core Elasticsearch and Kibana code is free to download, and the company makes money by selling paid subscriptions that add advanced features (machine learning, security analytics, AI assistants, enterprise support) and by running the software for customers as Elastic Cloud on AWS, Microsoft Azure and Google Cloud.
Growth strategy
Elastic's strategy is to make Elasticsearch the retrieval layer for enterprise AI while consolidating observability and security tools onto the same platform. Recent moves include buying Jina AI (embeddings and rerankers) and Keep (AIOps alert management) in 2025, launching Elastic Workflows and Agent Builder for agentic automation, and releasing a serverless vector database in September 2026.
Competitive advantage
Elastic's main edge is that one data store handles text search, vector search, analytics, logs and security events. Elasticsearch is built on Apache Lucene's inverted index, which makes full-text search across very large unstructured datasets fast, and the company has added dense vector search, hybrid ranking (BM25 plus vectors with reciprocal rank fusion), the ES|QL query language and Jina AI embedding and reranker…
Questions about Datadog vs Elastic
Which company has higher revenue — Datadog, Inc. or Elastic?
Datadog, Inc. reported $3.4B (FY2025), while Elastic reported $1.7B (FY2026). By last reported revenue, Datadog, Inc. is the larger business, with Elastic reporting a smaller revenue base. Note: these are from different fiscal years and are not a direct like-for-like comparison.
What is the market cap of Datadog, Inc. vs Elastic?
Datadog, Inc.'s market capitalisation stands at $96.3B, while Elastic's is $9.3B. Datadog, Inc. carries the higher market valuation, reflecting investors' expectations of its future earnings power relative to Elastic.
Which is more financially efficient — Datadog, Inc. or Elastic?
Datadog, Inc. generates $423k / employee in revenue per employee, while Elastic generates $433k / employee. Elastic shows higher revenue efficiency per headcount, though this reflects business model differences — capital-light software companies routinely outperform labour-intensive manufacturers on this metric.
How do Datadog, Inc. and Elastic make money?
Datadog, Inc. and Elastic generate revenue in fundamentally different ways. Datadog, Inc.: Datadog runs a B2B subscription model. Elastic: Elastic is a B2B software company with an open-core model.
Which company is valued higher relative to revenue — Datadog, Inc. or Elastic?
On a price-to-sales (P/S) basis, Datadog, Inc. trades at 28.1x P/S and Elastic at 5.3x P/S. Datadog, Inc. commands a higher revenue multiple, typically indicating that investors expect faster growth or higher future margins compared to Elastic. A higher multiple is not inherently better — it may also signal that the stock is priced for perfection.
Is Datadog, Inc. bigger than Elastic?
By last reported revenue, Datadog, Inc. ($3.4B (FY2025)) is the larger company compared to Elastic ($1.7B (FY2026)). Revenue scale is one dimension of size — market capitalisation, employee count, and geographic reach are also relevant depending on the context.
Figures come from each company's filings and the sources linked beside them. Amounts reported in another currency are shown in US dollars at an approximate rate and marked with ~. Back to the Datadog vs Elastic overview