DDOG · 10-Q · 2026Q2 · Full report
Operating Expense Trends
Datadog, Inc. · 2026-08-06 · Importance 64 · Surprise 56 · From source text
Sales and marketing expense increased 30% to $311.5 million in the second quarter and to $591.3 million in the first six months, compared with $239.0 million and $453.3 million in the prior-year periods. Sales and marketing personnel and allocated overhead costs increased $56.6 million quarterly and $110.3 million year to date, while advertising, sales, marketing and promotional costs increased $12.0 million and $23.1 million. General and administrative expense increased 24% quarterly to $86.4 million and 23% year to date to $161.1 million, primarily from $12.9 million and $24.4 million increases in personnel and allocated overhead costs. Total operating expenses increased 26% quarterly to $875.9 million and 27% year to date to $1.666 billion.
Key facts
- Sales and marketing expense for the three months ended June 30, 2026 was $311,519 thousand, an increase of $72,493 thousand (30%) versus $239,026 thousand in the prior year period. source
- Sales and marketing expense for the six months ended June 30, 2026 was $591,342 thousand, an increase of $138,025 thousand (30%) versus $453,317 thousand in the prior year period. source
- Stock-based compensation expense included in total was $417,093 thousand for the six months ended June 30, 2026 and $344,727 thousand for the six months ended June 30, 2025. source
- General and administrative expense for the three months ended June 30, 2026 was $86,399 thousand, an increase of $16,625 thousand (24%) versus $69,774 thousand in the prior year period. source
- General and administrative expense for the six months ended June 30, 2026 was $161,149 thousand, an increase of $30,382 thousand (23%) versus $130,767 thousand in the prior year period. source
- Employer payroll taxes on employee stock transactions totaled $27,643 thousand for the three months ended June 30, 2026 and $16,067 thousand for the three months ended June 30, 2025. source
- The three month increase in sales and marketing was primarily due to $56.6 million higher personnel costs and $12.0 million higher advertising, sales, marketing and promotional activities. source
- The six month increase in sales and marketing was primarily due to $110.3 million higher personnel costs and $23.1 million higher advertising, sales, marketing and promotional activities. source
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| operating_income | negative | realized | -16.0% | Total operating expenses for the three months ended June 30, 2026 were $875,886 thousand versus $696,282 thousand for the three months… |
| operating_income | negative | realized | -9.8% | The six month increase in sales and marketing was primarily due to $110.3 million higher personnel costs and $23.1 million higher… |
| operating_income | negative | realized | -6.5% | Stock-based compensation expense included in total was $417,093 thousand for the six months ended June 30, 2026 and $344,727 thousand for… |
| operating_income | negative | realized | -5.0% | The three month increase in sales and marketing was primarily due to $56.6 million higher personnel costs and $12.0 million higher… |
| operating_income | negative | realized | -2.7% | General and administrative expense for the six months ended June 30, 2026 was $161,149 thousand, an increase of $30,382 thousand (23%)… |
| operating_income | negative | realized | -2.1% | The six month increase in sales and marketing was primarily due to $110.3 million higher personnel costs and $23.1 million higher… |
| operating_income | negative | realized | -1.5% | General and administrative expense for the three months ended June 30, 2026 was $86,399 thousand, an increase of $16,625 thousand (24%)… |
| operating_income | negative | realized | -1.1% | The three month increase in sales and marketing was primarily due to $56.6 million higher personnel costs and $12.0 million higher… |
| operating_income | negative | realized | -1.0% | Employer payroll taxes on employee stock transactions totaled $27,643 thousand for the three months ended June 30, 2026 and $16,067… |
| net_income | negative | realized | -0.3% | Provision for income taxes was $7,175 thousand for the three months ended June 30, 2026 and $3,441 thousand for the three months ended… |