Dynatrace (NYSE:DT) shares rallied more than 10% in premarket trading on Monday after the AI-driven software group delivered stronger-than-expected third-quarter results for fiscal 2026 and upgraded its outlook for the full year.
The observability platform provider reported fiscal Q3 earnings per share of $0.44, ahead of the $0.41 analysts had forecast. Revenue reached $515 million, topping market expectations of $505.8 million.
Annual recurring revenue rose 16% on a constant-currency basis, while subscription revenue posted the same 16% growth rate, highlighting continued demand for the company’s AI-powered monitoring tools.
Looking to the fourth quarter of fiscal 2026, Dynatrace expects earnings per share in the range of $0.38 to $0.39, compared with consensus estimates of $0.37. Revenue for the quarter is projected between $518 million and $523 million, above the $514.4 million anticipated by analysts.
For the full fiscal year, the company raised its earnings outlook to $1.67 to $1.69 per share, up from prior guidance of $1.62 to $1.64 and above the $1.64 consensus estimate.
Dynatrace also increased its full-year revenue forecast to between $2.0 billion and $2.01 billion, compared with its earlier range of $1.98 billion to $1.99 billion and analyst expectations of $1.99 billion. Full-year annual recurring revenue is now projected at $2.05 billion to $2.06 billion, an improvement from the previous outlook of $2.01 billion to $2.02 billion.