Dynatrace cut to Hold at Needham amid sustained revenue deceleration

As previously reported, Needham downgraded Dynatrace to Hold from Buy. The company’s sustained top-line deceleration has called into question the durability of its growth, while its go-to-market and product initiatives appear to be slipping to the right and are not expected to become meaningful contributors to the financial model until FY26, the analyst tells investors in a research note, adding that the firm sees shares of Dynatrace to be range-bound relative to other names under coverage. Dynatrace’s FY25 will see another deceleration, with growth slowing to about 16%-17% with no significant change to Net Retention, Needham stated.