Datto Earnings Jump in First Quarterly Financial Report Since Going Public

Datto reported a $19.5 million profit for its third quarter, its first quarterly earnings results since going public last month.

Datto officially began trading on the New York Stock Exchange (NYSE) on Oct. 21. Net proceeds from the IPO were nearly $642 million. Rob Rae, Datto’s senior vice president of business development, said MSP partners have a lot to look forward to with the company going public.

The latest Datto earnings were for the quarter ending Sept. 30.

Datto‘s profit jumped 617%, from $2.7 million in the third quarter of 2019. Total revenue was almost $131 million, up from just under $118 million for the year-ago quarter.

Datto’s Tim Weller

“We are pleased to report strong third-quarter 2020 results as a newly public company,” said Tim Weller, Datto’s CEO. “Both subscription revenue and annual run-rate revenue (ARR) grew 17% year-over-year, driven by expansion from existing MSP partners as they deployed more Datto solutions to more of their end clients, and by the addition of new partners.”

Repaying Debt

Datto used the IPO to repay $500 million in debt.

The company’s number of MSP partners grew to more than 17,200, an increase of 1,000 from a year ago.

“Our sequential ARR growth of $16 million is evidence of the reacceleration of our business and the tailwinds from the digital transformation of SMBs,” Weller said. “We continue to create enterprise-grade technology for SMBs delivered through our growing, global network of MSP partners. Our commitment to the MSP ecosystem is what makes Datto unique. It is the foundation of our strategy and culture.”

In July, Datto bought Gluh, an Australia-based company with a real-time quoting platform that allows MSPs to simplify the procurement of IT products and services for their clients.