Datadog (NASDAQ:DDOG) just dropped a solid Q3 report, smashing revenue expectations with a 26% year-over-year jump to $690 million, leaving Wall Street estimates in the dust. Non-GAAP earnings per share hit $0.46, again beating forecasts. But here's the kicker: Datadog's stock declined a bit in the pre-market trading, as investors zoomed in on the company's cautious guidance for Q4 rather than celebrating the solid numbers. It's a classic case of the market's forward-looking mindset clashing with strong immediate results.

• Warning! GuruFocus has detected 5 Warning Sign with DDOG.

Datadog's not just coasting, though. With around 3,490 customers now pulling in over $100,000 annuallya 12% boost from last yearthe company's customer base is expanding along with its product lineup. They just rolled out monitoring support for Oracle Cloud Infrastructure, reinforcing their lead in cloud observability. CEO Olivier Pomel is confident about the company's edge in a crowded space, with Gartner naming Datadog a 2024 Leader in Digital Experience Monitoring. The growth story's there; the company is pushing all the right buttons, and the market is watching?.

Looking to Q4, Datadog forecasts revenue between $709 million and $713 million, just under what Wall Street hoped for, with adjusted earnings expected at $0.42 to $0.44 per share. It's a cautious approach that's got investors thinking twice, especially with economic uncertainties in the background. But with a hefty $3.2 billion in cash and marketable securities on the books, Datadog's ready to ride out any bumps. For those watching the long game, the company's position in the booming cloud security and observability market hasn't changedit's just a matter of patience?.

This article first appeared on GuruFocus.