Dynatrace Inc Q3 2021 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Matthew George Hedberg - RBC Capital Markets, Research Division - Analyst : Really strong third quarter here. John, I wanted to ask you about the expanded GCP partnership. Obviously, you guys had a press release a little bit ago, but I'm sort of curious, can you talk about lessons learned from AWS? Obviously, they were sort of a bigger partner earlier. How did that partnership progress? I'm just sort of trying to get a sense for how it might impact ARR. And then could you talk about the importance of really being the only observability platform with a private offering in all 3 public cloud marketplaces?

Question: Matthew George Hedberg - RBC Capital Markets, Research Division - Analyst : That's super helpful. And then, Kevin, I really do appreciate you calling out the $8 million perpetual runoff headwind in Q3 and the $16 million expectation for Q4. I'm sort of curious, obviously, this will continue on into next year, and you haven't guided full year next year. But can you talk about sort of the cadence of that runoff in -- as we progress through fiscal '22?

Question: Jennifer Alexandra Swanson Lowe - UBS Investment Bank, Research Division - Analyst : Maybe just to continue on that last question. If I look at the guidance for Q4, and there are a lot of puts and takes there around currency and the headwinds, but if -- from the model runoff. But if I back those out, it seems like the guidance implies very little deceleration in ARR growth on a constant currency-adjusted basis relative to what we saw in Q3. So if I put that in context, should we assume that, that sort of reflects easier comparisons versus the impact of COVID kicking in March of last year? Or are you sort of getting more optimistic about the growth in the business outside of those impacted industries? Just any more context there would be helpful.

Question: Jennifer Alexandra Swanson Lowe - UBS Investment Bank, Research Division - Analyst : Great. And maybe just one more for me. You commented that 40% of customers were using the infrastructure-only module. And I'm curious, when you get in the door with that offering, how broad do customers typically go on the infrastructure side? Or are they -- I mean in theory, you could cover 100% of the enterprise on infrastructure. Are you seeing those sort of wall-to-wall deployments yet? Or is it still sort of more contained around work -- environments sort of related where they're using APM. Could you just add some more context on how broad that can go at this point? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 03, 2021 / 1:00PM, DT.N - Q3 2021 Dynatrace Inc Earnings Call

Question: David E. Hynes - Canaccord Genuity Corp., Research Division - Analyst : Congrats on the results. Maybe I want to follow-up on the last question on the security front a little bit. Look, I realize how early it is, and I'm sure there's a bit of price discovery happening in the market now. But if you think like looking forward, how much of an uplift to spend could the adoption of security be, right? I mean if you have the average customer spending $250,000 with you, is it a 10% uplift, 20%, like more? Like any frame of reference there would be helpful as we think about the opportunity.

Question: David E. Hynes - Canaccord Genuity Corp., Research Division - Analyst : Yes. Yes, makes sense. And then maybe just a higher-level question that kind of gets at the triggers for expansion. I think looking backwards, right, over the last couple of years, like the migration of the new platform was a great opportunity for you guys to get in there and get bigger, right? Now that we're past that, like what's typically the catalyst for expansion in the base, right? Is it just the digital transformation initiatives that you're seeing? Is it new products trigger conversation? Does it just happen at renewals? Like help us -- like what's the process and speak to that maybe in the context of sustainability of that 120-plus percent net dollar expansion? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 03, 2021 / 1:00PM, DT.N - Q3 2021 Dynatrace Inc Earnings Call

Question: David E. Hynes - Canaccord Genuity Corp., Research Division - Analyst : Makes sense. Congrats.