12 Best Performing Cybersecurity Stocks in 2025

9. Datadog Inc (NASDAQ:DDOG)

Number of Hedge Fund Holders: 75

Past Year Performance: 27.41%

Datadog Inc (NASDAQ:DDOG) is among the best performing cybersecurity stocks in 2025. On April 2, Wells Fargo identified Datadog Inc (NASDAQ:DDOG) as one of its favorite stocks in the Saas sector. According to the firm, investors are emphasizing long-term durability for software stocks amid the ramp up in AI spending.

Regarding Datadog, Wells Fargo noted increased investor optimism with new AI lab upside. The firm also pointed to the use of Datadog’s API in Claude Code.

Also on April 2, Datadog debuted a product testing tool that it says fills a big gap in the market. Called Datadog Experiments, this tool allows teams to design, launch, and test products within the Datadog platform.

According to the company, this tool provides teams with data and insights to help them understand how product changes impact user behavior, app performance, and business outcomes.

Datadog came up with this tool to help teams overcome the limitations of the current fragmented workflows in product experimentation. The company says that teams can easily miss insights on revenue drivers and kill bold bets if they rely on fragmented platforms to run experiments. This challenge becomes more difficult as AI speeds up feature development. So its Datadog Experiments tool solves this problem.

In other news, Datadog launched a new AI-driven security agent on March 23. Called Bits AI Security Analyst, this tool speeds up threat investigation and remediation. With this tool, investigations that would normally take hours can be done in just 30 seconds.

Datadog sees its Bits AI Security Analyst tool as a perfect fit for operation security centers. It points out that AI-powered attacks have increased problems and strained security teams. With its AI-driven tool, Datadog says security teams can address threats faster and more effectively.

Datadog Inc (NASDAQ:DDOG) provides observability and security services for cloud applications. It helps with monitoring of servers, networks, databases, and tools. Datadog also helps with log management, product analytics, error tracking, incident response, and workload automation. The company is headquartered in New York.