Datadog (DDOG) sees continued broad-based strength across both artificial intelligence-native and non-AI-native customers, with demand not concentrated among ramping large customers, RBC Capital Markets said.

RBC noted the quarter marked the fourth straight quarter of accelerating growth and one of Datadog's strongest results in recent memory. Revenue growth exceeding 30% for the first time since first quarter of 2023 reinforced what it views as sustained underlying momentum as AI adoption continues to inflect and tech stack modernization accelerates.

A highlight of the quarter was an eight- and seven-figure annualized deal with AI research divisions of two major tech companies for AI training as Datadog's platform continues to resonate with AI-native customers, RBC said in a research note Thursday, adding that despite the updated full-year guidance range, it still sees room for upside.

RBC raised its price target on Datadog to $219 from $161 and maintained its outperform rating.

Shares of Datadog were up nearly 2% in Friday trading.

Price: 192.10, Change: +3.37, Percent Change: +1.79