Datto just issued their Q3 2020 financial results. The newly public company now required to disclose financial statements every quarter provides us with more insight into the RMM market and the global managed services market.

“Both subscription revenue and ARR grew 17 percent year-over-year driven by expansion from existing managed service provider partners as they deployed more Datto solutions to more of their end clients, and by the addition of new partners,” said Tim Weller, Datto’s Chief Executive Officer.

Datto reported annual recurring revenue (ARR) growth of $16M compared to 2019. Weller continued by proclaiming the importance of MSPs in the success of Datto. “Our commitment to the MSP ecosystem is what makes Datto unique – it is the foundation of our strategy and culture.”

While Datto is not the only RMM platform selling predominantly to MSPs, if the other MSP ecosystems are experiencing similar growth, things look pretty good in the managed services universe. Something for which we can all be thankful.

Datto Q3 2020 Financials

Third Quarter 2020 Financial Results
(In Millions)
	Q3 2020		Q3 2019		Y/Y Change
Subscription Revenue	$122.8		$105.2		17%
Total Revenue	$130.7		$117.7		11%
ARR(1)	$522.8		$445.4		17%
Gross Margin	73%		66%		691 bps
Net Income	$19.5		$2.7		617%
Adjusted EBITDA(2)	$45.8		$25.8		78%
Free Cash Flow(2)	$43.6		-$2.8		NA