• Live Feeds
    • Press Releases
    • Insider Trading
    • FDA Approvals
    • Analyst Ratings
    • Insider Trading
    • SEC filings
    • Market insights
  • Analyst Ratings
  • Alerts
  • Subscriptions
  • Settings
  • RSS Feeds
Quantisnow Logo
  • Live Feeds
    • Press Releases
    • Insider Trading
    • FDA Approvals
    • Analyst Ratings
    • Insider Trading
    • SEC filings
    • Market insights
  • Analyst Ratings
  • Alerts
  • Subscriptions
  • Settings
  • RSS Feeds
Dashboard
    Quantisnow Logo

    © 2025 quantisnow.com
    Democratizing insights since 2022

    Services
    Live news feedsRSS FeedsAlerts
    Company
    AboutQuantisnow PlusContactJobs
    Legal
    Terms of usePrivacy policyCookie policy

    DigitalOcean Announces Second Quarter 2024 Financial Results

    8/8/24 4:05:00 PM ET
    $DOCN
    Computer Software: Programming Data Processing
    Technology
    Get the next $DOCN alert in real time by email

    Revenue of $192 million, up 13% year-over-year

    GAAP Net Income was $19 million and Adjusted EBITDA was $82 million at 42% margin

    DigitalOcean Holdings, Inc. (NYSE:DOCN), the developer cloud optimized for startups and growing technology businesses, today announced results for its second quarter ended June 30, 2024.

    "We have delivered another strong quarter of business results and exciting product announcements. In Q2 we saw revenue growth continue to re-accelerate at 13%, with AI/ML continuing to accelerate with ARR up over 200% year-over-year, and expanded our leadership team by adding a Chief Product and Technology Officer to accelerate innovation, a Chief Ecosystem and Growth Officer to drive growth and engagement within our developer community and a Chief Revenue Officer to fortify our go-to-market functions," said Paddy Srinivasan, CEO of DigitalOcean. "With our new leadership team in place and accelerating product innovation, we continue to execute on our mission of providing cloud computing to growing technology companies as well as pursue our AI strategy of democratizing access to GPU Infrastructure and a compelling platform to simplify building and consuming AI."

    Second Quarter 2024 Financial Highlights:

    • Revenue was $192 million, an increase of 13% year-over-year.
    • Annual Run-Rate Revenue (ARR) ended the quarter at $781 million, an increase of 15% year-over-year.
    • Gross profit of $117 million, an increase of 15% year-over-year, and gross profit margin was 61%.
    • Net income attributable to common stockholders was $19 million and net income margin was 10%.
    • Adjusted EBITDA was $82 million, an increase of 13% year-over-year, and adjusted EBITDA margin was 42%.
    • Diluted net income per share was $0.20 and non-GAAP diluted net income per share was $0.48.
    • Net cash from operating activities was $71 million as compared to $64 million in the second quarter 2023.
    • Adjusted free cash flow was $37 million as compared to $45 million in the second quarter 2023.
    • Cash and cash equivalents was $443 million as of June 30, 2024.

    Second Quarter 2024 Operational Highlights:

    • On July 9, revived the virtual developer conference, Deploy, where a number of product releases were announced such as VPC Peering Beta and Premium CPU Optimized 96 vCPU Droplets, among others.
    • Announced the EA (Early Availability) of GPU droplets which democratizes on-demand access to NVIDIA H100 instances for customers (including DigitalOcean's approximately 638 thousand customers) with the ability to leverage 1, 8 or more GPUs providing flexible deployment options tailored to various use cases and budgets.
    • Released 24 new product features throughout the second quarter, doubling our product velocity from the prior 6 months, which include Managed OpenSearch and 5th Generation Xeon Processors, as well as enhanced data processing and transfer capabilities within our data centers.
    • Average Revenue Per Customer (ARPU) was $99.45, an increase of 9% over the second quarter 2023.
    • Builders and Scalers, those customers spending more than $50 per month, increased 7% from the second quarter 2023 and their revenue grew 15% year-over-year.
    • Net Dollar Retention Rate (NDR) remained stable at 97% as compared to the prior quarter.
    • The Company repurchased 297,106 shares during the quarter.

    Financial Outlook:

    DigitalOcean is initiating guidance for the third quarter ending September 30, 2024 as follows:

    • Total revenue of $196 to $197 million.
    • Adjusted EBITDA margin of 37% to 38%.
    • Non-GAAP diluted net income per share of $0.39 to $0.41.
    • Fully diluted weighted average shares outstanding of approximately 102 to 103 million shares.

    DigitalOcean is updating guidance for the full year 2024 as follows:

    • Total revenue of $770 to $775 million.
    • Adjusted EBITDA margin of 37% to 39%.
    • Adjusted free cash flow margin in the range of 15% to 17% of revenue.
    • Non-GAAP diluted net income per share of $1.60 to $1.70.
    • Fully diluted weighted average shares outstanding of approximately 102 to 103 million shares.

    A reconciliation of non-GAAP outlook measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, expenses that may be incurred in the future. For example, stock-based compensation expense-related charges are impacted by the timing of employee stock transactions, the future fair market value of our common stock, and our future hiring and retention needs, all of which are difficult to predict and subject to constant change. Accordingly, a reconciliation is not available without unreasonable effort and we are unable to assess the probable significance of the unavailable information, although it is important to note that these factors could be material to our results computed in accordance with GAAP.

    Conference Call Information:

    DigitalOcean will host a conference call today, August 8, 2024, at 5:00 p.m. ET to review its results. The conference call and presentation can be accessed by registering for the webcast at https://events.q4inc.com/attendee/527008089. A live webcast and replay of the conference call in addition to the presentation can be accessed from the DigitalOcean investor relations website at http://investors.digitalocean.com.

    About DigitalOcean

    DigitalOcean simplifies cloud computing so businesses can spend more time creating software that changes the world. With its mission-critical infrastructure and fully managed offerings, DigitalOcean helps developers at startups and growing digital businesses rapidly build, deploy and scale, whether creating a digital presence or building digital products. DigitalOcean combines the power of simplicity, security, community and customer support so customers can spend less time managing their infrastructure and more time building innovative applications that drive business growth. For more information, visit digitalocean.com.

    Forward‑Looking Statements

    This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding our performance, including but not limited to statements in the section titled "Financial Outlook." The forward-looking statements contained in this release and the accompanying earnings call referenced in this release are subject to known and unknown risks, uncertainties, assumptions, and other factors that may cause actual results or outcomes to be materially different from any future results or outcomes expressed or implied by the forward-looking statements. These risks, uncertainties, assumptions, and other factors include, but are not limited to: (1) fluctuations in our financial results make it difficult to project future results; (2) our history of operating losses; (3) our identification of a material weakness in our internal control over financial reporting, which may impact our ability to accurately report our financial statements; (4) our ability to attract and retain customers and/or expand usage of our platform by such customers; (5) our ability to release updates and new features to our platform and adapt and respond effectively to rapidly changing technology or customer needs; (6) breaches in our security measures allowing unauthorized access to our platform, our data, or our customers' data; (7) the competitive markets in which we participate; (8) general market, political, economic, and business conditions; (9) the operational challenges related to international operations; (10) our ability to successfully integrate acquired businesses, including Paperspace, and achieve expected synergies and benefits; (11) liability we may incur due to the activities of our customers; and (12) our customers' ability to have continued and unimpeded access to our platform, including as a result of evolving laws and industry standards.

    Further information on these and additional risks, uncertainties, assumptions and other factors that could cause actual results or outcomes to differ materially from those included in or contemplated by the forward-looking statements contained in this release are included under the caption "Risk Factors" and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2023, and subsequent filings and reports we make with the SEC.

    We operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this release. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur. The forward-looking statements made in this release relate only to events as of the date on which the statements are made. We assume no obligation to, and do not currently intend to, update any such forward-looking statements after the date of this release.

    About Non-GAAP Financial Measures

    To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States, or GAAP, we provide investors with non-GAAP financial measures including: (i) adjusted EBITDA and adjusted EBITDA margin; (ii) non-GAAP net income and non-GAAP diluted net income per share; and (iii) adjusted free cash flow and adjusted free cash flow margin. These measures are presented for supplemental informational purposes only, have limitations as analytical tools and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In particular, adjusted free cash flow is not a substitute for cash provided by operating activities. Additionally, the utility of adjusted free cash flow as a measure of our financial performance and liquidity is further limited as it does not represent the total increase or decrease in our cash balance for a given period. Our calculations of each of these measures may differ from the calculations of measures with the same or similar titles by other companies and therefore comparability may be limited. Because of these limitations, when evaluating our performance, you should consider each of these non-GAAP financial measures alongside other financial performance measures, including the most directly comparable financial measure calculated in accordance with GAAP and our other GAAP results. A reconciliation of each of our non-GAAP financial measures to the most directly comparable financial measure calculated in accordance with GAAP is set forth in the tables in the section "Reconciliation of GAAP to Non-GAAP Data."

    Adjusted EBITDA and Adjusted EBITDA Margin

    We define adjusted EBITDA as net income (loss) attributable to common stockholders, adjusted to exclude depreciation and amortization, stock-based compensation, interest expense, acquisition related compensation, acquisition and integration related costs, income tax expense, restructuring and other charges, restructuring related charges, impairment of long-lived assets, and other income, net. We define adjusted EBITDA margin as adjusted EBITDA as a percentage of revenue. We believe that adjusted EBITDA, when taken together with our GAAP financial results, provides meaningful supplemental information regarding our operating performance and facilitates internal comparisons of our historical operating performance on a more consistent basis by excluding certain items that may not be indicative of our business, results of operations or outlook. In particular, we believe that the use of adjusted EBITDA is helpful to our investors as it is a measure used by management in assessing the health of our business, evaluating our operating performance, and for internal planning and forecasting purposes.

    Our calculation of adjusted EBITDA and adjusted EBITDA margin may differ from the calculations of adjusted EBITDA and adjusted EBITDA margin by other companies and therefore comparability may be limited. Because of these limitations, when evaluating our performance, you should consider adjusted EBITDA and adjusted EBITDA margin alongside other financial performance measures, including our net income (loss) attributable to common stockholders and other GAAP results.

    Non-GAAP Net Income and Non-GAAP Diluted Net Income Per Share

    We define non-GAAP net income as net income (loss) attributable to common stockholders, excluding stock-based compensation, acquisition related compensation, amortization of acquired intangibles, acquisition and integration related costs, restructuring and other charges, restructuring related charges, impairment of long-lived assets, and other unusual or non-recurring transactions as they occur. We define non-GAAP diluted net income per share as non-GAAP net income divided by the weighted-average diluted shares outstanding, which includes the potentially dilutive effect of our stock options, RSUs, PRSUs, and Convertible Notes.

    We believe non-GAAP diluted net income per share provides our management and investors consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations, as this metric generally eliminates the effects of unusual or non-recurring items from period to period for reasons unrelated to overall operating performance.

    Adjusted Free Cash Flow and Adjusted Free Cash Flow Margin

    Adjusted free cash flow is a non-GAAP financial measure that we define as Net cash provided by operating activities less purchases of property and equipment, capitalized internal-use software costs, and excluding cash paid for restructuring and other charges, acquisition related compensation, restructuring related charges, and acquisition and integration related costs. Adjusted free cash flow margin is calculated as adjusted free cash flow divided by total revenue.

    We believe that adjusted free cash flow and adjusted free cash flow margin are useful indicators of liquidity that provide information to management and investors about the amount of cash generated from our core operations that can be used for strategic initiatives, including investing in our business and selectively pursuing acquisitions and strategic investments. We further believe that historical and future trends in adjusted free cash flow and adjusted free cash flow margin, even if negative, provide useful information about the amount of Net cash provided by operating activities that is available (or not available) to be used for strategic initiatives. One limitation of adjusted free cash flow and adjusted free cash flow margin is that they do not reflect our future contractual commitments. Additionally, adjusted free cash flow does not represent the total increase or decrease in our cash balance for a given period.

    Key Business Metrics:

    We utilize the key metrics set forth below to help us evaluate our business and growth, identify trends, formulate financial projections and make strategic decisions.

    Customers

    We divide our customer population into the following categories:

    • Testers: users that both (i) spend less than or equal to $50 per month and (ii) utilize our platform for three months or less.
    • Learners: users that both (i) spend less than or equal to $50 for the month-end period and (ii) have been on our platform for more than three months.
    • Builders: users that spend greater than $50 and less than or equal to $500 for the month-end period.
    • Scalers: users that spend greater than $500 for the month-end period.

    We view Learners, Builders and Scalers as the most appropriate measure of our customer population, and Testers have therefore been excluded from the total customer population count. While we believe the total number of these customers is an important indicator of the growth of our business and future revenue opportunity, the trends relating to our Builders and Scalers is of particular importance to us as these customers represent a significant majority of our revenue and revenue growth, and they are representative of the SMB customers that grow on our platform and use multiple products.

    ARPU

    We calculate ARPU on a monthly basis as our total revenue from Learners, Builders and Scalers in that period divided by the total number of Learner, Builder and Scaler customers determined as of the last day of the reported period. For a quarterly or annual period, ARPU is determined as the weighted average monthly ARPU over such three or 12-month period.

    ARR

    We calculate ARR at a point in time by multiplying the revenue of the last month of the reported period by 12. For our ARR calculations, we include the total revenue from all customers, including Testers, Learners, Builders and Scalers.

    Net Dollar Retention Rate

    We calculate net dollar retention rate monthly by starting with the revenue from customers, including Testers, Learners, Builders and Scalers, for our IaaS, PaaS and SaaS offerings during the corresponding month 12 months prior, or the Prior Period Revenue. We then calculate the revenue from these same customers as of the current month, or the Current Period Revenue, including any expansion and net of any contraction or attrition from these customers over the last 12 months. The calculation also includes revenue from customers that generated revenue before, but not in, the corresponding month 12 months prior, but subsequently generated revenue in the current month and are therefore reflected in the Current Period Revenue. We include this group of re-engaged customers in this calculation because our customers frequently use our platform for projects that stop and start over time. We then divide the total Current Period Revenue by the total Prior Period Revenue to arrive at the net dollar retention rate for the relevant month. For our net dollar retention rate calculations, we include the total revenue from customers, including Testers, Learners, Builders and Scalers, for our IaaS, PaaS and SaaS offerings. For a quarterly or annual period, the net dollar retention rate is determined as the average monthly net dollar retention rates over such three or 12-month period.

    DIGITALOCEAN HOLDINGS, INC.

     

    CONDENSED CONSOLIDATED BALANCE SHEETS

    (in thousands, except share amounts)

    (unaudited)

     

     

    June 30, 2024

     

    December 31, 2023

    Current assets:

     

     

     

    Cash and cash equivalents

    $

    443,110

     

     

    $

    317,236

     

    Marketable securities

     

    —

     

     

     

    94,532

     

    Accounts receivable, less allowance for credit losses of $5,486 and $5,848, respectively

     

    67,435

     

     

     

    62,186

     

    Prepaid expenses and other current assets

     

    33,178

     

     

     

    29,040

     

    Total current assets

     

    543,723

     

     

     

    502,994

     

     

     

     

     

    Property and equipment, net

     

    367,428

     

     

     

    305,444

     

    Restricted cash

     

    1,747

     

     

     

    1,747

     

    Goodwill

     

    348,674

     

     

     

    348,322

     

    Intangible assets, net

     

    128,682

     

     

     

    140,151

     

    Operating lease right-of-use assets, net

     

    138,461

     

     

     

    155,201

     

    Deferred tax assets

     

    1,939

     

     

     

    1,994

     

    Other assets

     

    6,139

     

     

     

    5,114

     

    Total assets

    $

    1,536,793

     

     

    $

    1,460,967

     

     

     

     

     

    Current liabilities:

     

     

     

    Accounts payable

    $

    9,465

     

     

    $

    3,957

     

    Accrued other expenses

     

    55,839

     

     

     

    31,046

     

    Deferred revenue

     

    6,803

     

     

     

    5,340

     

    Operating lease liabilities, current

     

    73,998

     

     

     

    81,320

     

    Other current liabilities

     

    74,051

     

     

     

    70,982

     

    Total current liabilities

     

    220,156

     

     

     

    192,645

     

     

     

     

     

    Deferred tax liabilities

     

    3,510

     

     

     

    3,533

     

    Long-term debt

     

    1,481,577

     

     

     

    1,477,798

     

    Operating lease liabilities, non-current

     

    82,992

     

     

     

    91,161

     

    Other long-term liabilities

     

    2,342

     

     

     

    9,528

     

    Total liabilities

     

    1,790,577

     

     

     

    1,774,665

     

     

     

     

     

    Preferred stock ($0.000025 par value per share; 10,000,000 shares authorized; 0 shares issued and outstanding as of June 30, 2024 and December 31, 2023)

     

    —

     

     

     

    —

     

    Common stock ($0.000025 par value per share; 750,000,000 shares authorized; 91,698,027 and 90,243,442 issued and outstanding as of June 30, 2024 and December 31, 2023, respectively)

     

    2

     

     

     

    2

     

    Additional paid-in capital

     

    56,748

     

     

     

    30,989

     

    Accumulated other comprehensive loss

     

    (577

    )

     

     

    (452

    )

    Accumulated deficit

     

    (309,957

    )

     

     

    (344,237

    )

    Total stockholders' deficit

     

    (253,784

    )

     

     

    (313,698

    )

     

     

     

     

    Total liabilities and stockholders' deficit

    $

    1,536,793

     

     

    $

    1,460,967

     

    DIGITALOCEAN HOLDINGS, INC.

     

    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

    (in thousands, except per share amounts)

    (unaudited)

     

     

    Three Months Ended

     

    Six Months Ended

     

    June 30,

     

    June 30,

     

    2024

     

    2023

     

    2024

     

    2023

    Revenue

    $

    192,476

     

     

    $

    169,814

     

     

    $

    377,206

     

     

    $

    334,948

     

    Cost of revenue

     

    75,139

     

     

     

    67,354

     

     

     

    147,783

     

     

     

    139,233

     

    Gross profit

     

    117,337

     

     

     

    102,460

     

     

     

    229,423

     

     

     

    195,715

     

    Operating expenses:

     

     

     

     

     

     

     

    Research and development

     

    34,040

     

     

     

    38,569

     

     

     

    68,011

     

     

     

    76,841

     

    Sales and marketing

     

    20,130

     

     

     

    16,100

     

     

     

    40,934

     

     

     

    34,331

     

    General and administrative

     

    40,839

     

     

     

    48,858

     

     

     

    86,612

     

     

     

    97,797

     

    Restructuring and other charges

     

    —

     

     

     

    434

     

     

     

    —

     

     

     

    21,303

     

    Total operating expenses

     

    95,009

     

     

     

    103,961

     

     

     

    195,557

     

     

     

    230,272

     

     

     

     

     

     

     

     

     

    Income (loss) from operations

     

    22,328

     

     

     

    (1,501

    )

     

     

    33,866

     

     

     

    (34,557

    )

     

     

     

     

     

     

     

     

    Other income (expense):

     

     

     

     

     

     

     

    Interest expense

     

    (2,321

    )

     

     

    (2,112

    )

     

     

    (4,625

    )

     

     

    (4,301

    )

    Interest income and other income, net

     

    4,802

     

     

     

    7,594

     

     

     

    9,823

     

     

     

    14,988

     

    Other income, net

     

    2,481

     

     

     

    5,482

     

     

     

    5,198

     

     

     

    10,687

     

     

     

     

     

     

     

     

     

    Income (loss) before income taxes

     

    24,809

     

     

     

    3,981

     

     

     

    39,064

     

     

     

    (23,870

    )

    Income tax (expense) benefit

     

    (5,671

    )

     

     

    (3,316

    )

     

     

    (5,787

    )

     

     

    8,165

     

    Net income (loss) attributable to common stockholders

    $

    19,138

     

     

    $

    665

     

     

    $

    33,277

     

     

    $

    (15,705

    )

    Net income (loss) per share attributable to common stockholders

    Basic

    $

    0.21

     

     

    $

    0.01

     

     

    $

    0.37

     

     

    $

    (0.17

    )

    Diluted

    $

    0.20

     

     

    $

    0.01

     

     

    $

    0.35

     

     

    $

    (0.17

    )

    Weighted-average shares used to compute net income (loss) per share attributable to common stockholders

    Basic

     

    91,318

     

     

     

    89,007

     

     

     

    91,049

     

     

     

    92,327

     

    Diluted

     

    93,832

     

     

     

    96,247

     

     

     

    94,005

     

     

     

    92,327

     

    DIGITALOCEAN HOLDINGS, INC.

     

    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

    (in thousands)

    (unaudited)

     

     

    Six Months Ended June 30,

     

    2024

     

    2023

    Operating activities

     

     

     

    Net income (loss) attributable to common stockholders

    $

    33,277

     

     

    $

    (15,705

    )

    Adjustments to reconcile net income (loss) to net cash provided by operating activities:

     

     

     

    Depreciation and amortization

     

    65,016

     

     

     

    56,531

     

    Stock-based compensation

     

    44,710

     

     

     

    67,960

     

    Provision for expected credit losses

     

    7,985

     

     

     

    7,551

     

    Operating lease right-of-use assets and liabilities, net

     

    1,423

     

     

     

    6,848

     

    Net accretion of discounts and amortization of premiums on investments

     

    2,569

     

     

     

    (2,689

    )

    Non-cash interest expense

     

    3,988

     

     

     

    3,969

     

    Loss on impairment of long-lived assets

     

    356

     

     

     

    553

     

    Deferred income taxes

     

    —

     

     

     

    1,589

     

    Other

     

    361

     

     

     

    (464

    )

    Changes in operating assets and liabilities:

     

     

     

    Accounts receivable

     

    (13,234

    )

     

     

    (10,795

    )

    Prepaid expenses and other current assets

     

    (4,346

    )

     

     

    (6,173

    )

    Accounts payable and accrued expenses

     

    (3,655

    )

     

     

    (14,900

    )

    Deferred revenue

     

    1,462

     

     

     

    (565

    )

    Other assets and liabilities

     

    (1,879

    )

     

     

    6,666

     

    Net cash provided by operating activities

     

    138,033

     

     

     

    100,376

     

     

     

     

     

    Investing activities

     

     

     

    Capital expenditures - property and equipment

     

    (75,534

    )

     

     

    (46,848

    )

    Capital expenditures - internal-use software development

     

    (4,046

    )

     

     

    (2,895

    )

    Cash paid for asset acquisitions

     

    —

     

     

     

    (2,500

    )

    Purchase of marketable securities

     

    —

     

     

     

    (318,238

    )

    Maturities of marketable securities

     

    91,675

     

     

     

    614,044

     

    Purchased interest on marketable securities

     

    —

     

     

     

    (151

    )

    Proceeds from interest on marketable securities

     

    —

     

     

     

    61

     

    Proceeds from sale of equipment

     

    —

     

     

     

    236

     

    Net cash provided by investing activities

     

    12,095

     

     

     

    243,709

     

     

     

     

     

    Financing activities

     

     

     

    Proceeds related to the issuance of common stock under equity incentive plan

     

    7,948

     

     

     

    11,669

     

    Proceeds from the issuance of common stock under employee stock purchase plan

     

    2,231

     

     

     

    2,797

     

    Principal repayments of finance leases

     

    (2,720

    )

     

     

    —

     

    Employee payroll taxes paid related to net settlement of equity awards

     

    (13,469

    )

     

     

    (10,532

    )

    Repurchase and retirement of common stock including related costs

     

    (18,183

    )

     

     

    (368,919

    )

    Net cash used in financing activities

     

    (24,193

    )

     

     

    (364,985

    )

     

     

     

     

    Effect of exchange rate changes on cash, cash equivalents, and restricted cash

     

    (61

    )

     

     

    (15

    )

    Increase (decrease) in cash, cash equivalents and restricted cash

     

    125,874

     

     

     

    (20,915

    )

    Cash, cash equivalents and restricted cash - beginning of period

     

    318,983

     

     

     

    151,807

     

    Cash, cash equivalents and restricted cash - end of period

    $

    444,857

     

     

    $

    130,892

     

    DIGITALOCEAN HOLDINGS, INC.

     

    RECONCILIATION OF GAAP TO NON-GAAP DATA

    (unaudited)

    Adjusted EBITDA and Adjusted EBITDA Margin

     

     

    Three Months Ended

     

    Six Months Ended

     

    June 30,

     

    June 30,

    (In thousands)

    2024

     

    2023

     

    2024

     

    2023

    GAAP Net income (loss) attributable to common stockholders

    $

    19,138

     

     

    $

    665

     

     

    $

    33,277

     

     

    $

    (15,705

    )

     

     

     

     

     

     

     

     

    Adjustments:

     

     

     

     

     

     

     

    Depreciation and amortization

     

    33,129

     

     

     

    27,618

     

     

     

    65,016

     

     

     

    56,531

     

    Stock-based compensation(1)

     

    21,833

     

     

     

    36,429

     

     

     

    44,563

     

     

     

    64,023

     

    Interest expense

     

    2,321

     

     

     

    2,112

     

     

     

    4,625

     

     

     

    4,301

     

    Acquisition related compensation

     

    3,716

     

     

     

    6,980

     

     

     

    8,246

     

     

     

    14,581

     

    Acquisition and integration related costs

     

    (19

    )

     

     

    1,446

     

     

     

    —

     

     

     

    2,747

     

    Income tax expense

     

    5,671

     

     

     

    3,316

     

     

     

    5,787

     

     

     

    (8,165

    )

    Restructuring and other charges(1)

     

    —

     

     

     

    434

     

     

     

    —

     

     

     

    21,303

     

    Restructuring related charges(1)(2)

     

    243

     

     

     

    820

     

     

     

    3,863

     

     

     

    2,727

     

    Impairment of long-lived assets

     

    356

     

     

     

    —

     

     

     

    356

     

     

     

    553

     

    Other income, net(3)

     

    (4,802

    )

     

     

    (7,594

    )

     

     

    (9,823

    )

     

     

    (14,988

    )

    Adjusted EBITDA

    $

    81,586

     

     

    $

    72,226

     

     

    $

    155,910

     

     

    $

    127,908

     

    As a percentage of revenue:

     

     

     

     

     

     

     

    Net income (loss) margin

     

    10

    %

     

     

    —

    %

     

     

    9

    %

     

     

    (5

    )%

    Adjusted EBITDA margin

     

    42

    %

     

     

    43

    %

     

     

    41

    %

     

     

    38

    %

    ___________________

    (1)

    For the six months ended June 30, 2024, non-GAAP stock-based compensation excludes $0.1 million as it is presented in Restructuring related charges. For the six months ended June 30, 2023, non-GAAP stock-based compensation excludes $3.9 million, as it is presented in Restructuring and other charges. There were no reclassifications of stock-based compensation for the three months ended June 30, 2024 and 2023.

    (2)

    For the three and six months ended June 30, 2024, primarily consists of executive reorganization charges. For the three and six months ended June 30, 2023, primarily consists of salary continuation charges.

    (3)

    For the three and six months ended June 30, 2024 and 2023, primarily consists of interest and accretion income from our cash and cash equivalents and marketable securities.

    Non-GAAP Net Income and Non-GAAP Diluted Net Income Per Share

     

     

     

     

     

     

     

    Three Months Ended

     

    Six Months Ended

     

    June 30,

     

    June 30,

    (In thousands)

    2024

     

    2023

     

    2024

     

    2023

    GAAP Net income (loss) attributable to common stockholders

    $

    19,138

     

     

    $

    665

     

     

    $

    33,277

     

     

    $

    (15,705

    )

    Stock-based compensation(1)

     

    21,833

     

     

     

    36,429

     

     

     

    44,563

     

     

     

    64,023

     

    Acquisition related compensation

     

    3,716

     

     

     

    6,980

     

     

     

    8,246

     

     

     

    14,581

     

    Amortization of acquired intangible assets

     

    5,735

     

     

     

    3,790

     

     

     

    11,470

     

     

     

    7,580

     

    Acquisition and integration related costs

     

    (19

    )

     

     

    1,446

     

     

     

    —

     

     

     

    2,747

     

    Restructuring and other charges(1)

     

    —

     

     

     

    434

     

     

     

    —

     

     

     

    21,303

     

    Restructuring related charges(1)(2)

     

    243

     

     

     

    820

     

     

     

    3,863

     

     

     

    2,727

     

    Impairment of long-lived assets

     

    356

     

     

     

    —

     

     

     

    356

     

     

     

    553

     

    Non-GAAP income tax adjustment(3)

     

    (3,397

    )

     

     

    (5,844

    )

     

     

    (11,423

    )

     

     

    (23,404

    )

    Non-GAAP Net income

    $

    47,605

     

     

    $

    44,720

     

     

    $

    90,352

     

     

    $

    74,405

     

     

     

     

     

     

     

     

     

    Non-cash charges related to convertible notes(4)

    $

    1,588

     

     

    $

    1,561

     

     

    $

    3,174

     

     

    $

    3,121

     

    Non-GAAP Net income used to compute net income per share, diluted

    $

    49,193

     

     

    $

    46,281

     

     

    $

    93,526

     

     

    $

    77,526

     

     

     

     

     

     

     

     

     

     

    Three Months Ended

     

    Six Months Ended

     

    June 30,

     

    March 31,

    (In thousands, except per share amounts)

    2024

     

    2023

     

    2024

     

    2023

    GAAP Net income (loss) per share attributable to common stockholders, diluted

    $

    0.20

     

     

    $

    0.01

     

     

    $

    0.35

     

     

    $

    (0.17

    )

    Stock-based compensation(1)

     

    0.21

     

     

     

    0.35

     

     

     

    0.44

     

     

     

    0.60

     

    Acquisition related compensation

     

    0.04

     

     

     

    0.07

     

     

     

    0.08

     

     

     

    0.14

     

    Amortization of acquired intangible assets

     

    0.06

     

     

     

    0.04

     

     

     

    0.11

     

     

     

    0.07

     

    Acquisition and integration related costs

     

    —

     

     

     

    0.01

     

     

     

    —

     

     

     

    0.03

     

    Restructuring and other charges(1)

     

    —

     

     

     

    —

     

     

     

    —

     

     

     

    0.20

     

    Restructuring related charges(1)(2)

     

    —

     

     

     

    0.01

     

     

     

    0.04

     

     

     

    0.03

     

    Impairment of long-lived assets

     

    —

     

     

     

    —

     

     

     

    —

     

     

     

    0.01

     

    Non-cash charges related to convertible notes(4)

     

    0.02

     

     

     

    0.01

     

     

     

    0.03

     

     

     

    0.03

     

    Non-GAAP income tax adjustment(3)

     

    (0.03

    )

     

     

    (0.06

    )

     

     

    (0.11

    )

     

     

    (0.22

    )

    Non-GAAP Net income per share, diluted*

    $

    0.48

     

     

    $

    0.44

     

     

    $

    0.91

     

     

    $

    0.72

     

     

     

     

     

     

     

     

     

    GAAP Weighted-average shares used to compute net income (loss) per share, diluted

     

    93,832

     

     

     

    96,247

     

     

     

    94,005

     

     

     

    92,327

     

    Weighted-average dilutive effect of potentially dilutive securities

     

    8,403

     

     

     

    8,403

     

     

     

    8,403

     

     

     

    15,583

     

    Non-GAAP Weighted-average shares used to compute net income per share, diluted

     

    102,235

     

     

     

    104,650

     

     

     

    102,408

     

     

     

    107,910

     

     

    *May not foot due to rounding

    ___________________

    (1)

    For the six months ended June 30, 2024, non-GAAP stock-based compensation excludes $0.1 million as it is presented in Restructuring related charges. For the six months ended June 30, 2023, non-GAAP stock-based compensation excludes $3.9 million, as it is presented in Restructuring and other charges. There were no reclassifications of stock-based compensation for the three months ended June 30, 2024 and 2023.

    (2)

    For the three and six months ended June 30, 2024, primarily consists of executive reorganization charges. For the three and six months ended June 30, 2023, primarily consists of salary continuation charges.

    (3)

    For the periods in fiscal year 2024, we used a tax rate of 16%, which we believe is a reasonable estimate of our long-term effective tax rate applicable to non-GAAP pre-tax income for 2024. For the periods in fiscal year 2023, we used a tax rate of 17%, which we believe was a reasonable estimate of our long-term effective tax rate applicable to non-GAAP pre-tax income for 2023.

    (4)

    Consists of non-cash interest expense for amortization of deferred financing fees related to the Convertible Notes.

    Adjusted Free Cash Flow and Adjusted Free Cash Flow Margin

     

     

    Three Months Ended

     

    Six Months Ended

     

    June 30,

     

    June 30,

    (In thousands)

    2024

     

    2023

     

    2024

     

    2023

    GAAP Net cash provided by operating activities

    $

    71,340

     

     

    $

    64,161

     

     

    $

    138,033

     

     

    $

    100,376

     

    Adjustments:

     

     

     

     

     

     

     

    Capital expenditures - property and equipment

     

    (31,869

    )

     

     

    (23,534

    )

     

     

    (75,534

    )

     

     

    (46,848

    )

    Capital expenditures - internal-use software development

     

    (2,483

    )

     

     

    (1,101

    )

     

     

    (4,046

    )

     

     

    (2,895

    )

    Restructuring and other charges

     

    —

     

     

     

    4,665

     

     

     

    61

     

     

     

    15,926

     

    Restructuring related charges(1)

     

    437

     

     

     

    820

     

     

     

    4,630

     

     

     

    2,727

     

    Acquisition related compensation

     

    —

     

     

     

    —

     

     

     

    8,326

     

     

     

    —

     

    Acquisition and integration related costs

     

    4

     

     

     

    93

     

     

     

    302

     

     

     

    1,561

     

    Adjusted free cash flow

    $

    37,429

     

     

    $

    45,104

     

     

    $

    71,772

     

     

    $

    70,847

     

    As a percentage of revenue:

     

     

     

     

     

     

     

    GAAP Net cash provided by operating activities

     

    37

    %

     

     

    38

    %

     

     

    37

    %

     

     

    30

    %

    Adjusted free cash flow margin

     

    19

    %

     

     

    27

    %

     

     

    19

    %

     

     

    21

    %

    ___________________

    (1)

    For the three and six months ended June 30, 2024, primarily consists of executive reorganization charges. For the three and six months ended June 30, 2023, primarily consists of salary continuation charges.

     

    View source version on businesswire.com: https://www.businesswire.com/news/home/20240808490255/en/

    Get the next $DOCN alert in real time by email

    Chat with this insight

    Save time and jump to the most important pieces.

    Recent Analyst Ratings for
    $DOCN

    DatePrice TargetRatingAnalyst
    1/24/2025$45.00Buy
    Citigroup
    1/17/2025$39.00Neutral
    Cantor Fitzgerald
    1/16/2025$40.00 → $41.00Equal-Weight → Overweight
    Morgan Stanley
    5/22/2024$40.00Neutral
    UBS
    11/21/2023$37.00Perform → Outperform
    Oppenheimer
    11/7/2023$33.00Sell → Buy
    Goldman
    10/23/2023$30.00 → $22.00Underweight → Neutral
    Piper Sandler
    9/8/2023$47.00 → $25.00Buy → Underperform
    BofA Securities
    More analyst ratings

    $DOCN
    Press Releases

    Fastest customizable press release news feed in the world

    See more
    • DigitalOcean Announces Availability of New GPU Droplets, Accelerated by NVIDIA

      GPU Droplets support inference and complex AI workloads DigitalOcean Holdings, Inc. (NYSE:DOCN), the simplest scalable cloud for digital native enterprises, today announced that NVIDIA RTX 4000 Ada Generation, NVIDIA RTX 6000 Ada Generation, and NVIDIA L40S GPUs are generally available to customers as DigitalOcean GPU Droplets. These newly available GPU Droplets bring NVIDIA's powerful accelerated computing platform with best-in-class graphics and media acceleration to DigitalOcean's platform, and complement existing NVIDIA H100 GPU Droplets and H200 Bare Metal GPUs. By expanding access to NVIDIA GPUs at multiple price points, DigitalOcean GPU Droplets help reduce the barriers to AI adopt

      5/8/25 8:30:00 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • DigitalOcean Announces First Quarter 2025 Financial Results

      Q1 2025 Revenue of $211 million, up 14% year-over-year Q1 2025 Net Income was $38 million, up 170% year-over-year, at 18% margin and Adjusted EBITDA was $86 million, up 16% year-over-year, at 41% margin DigitalOcean Holdings, Inc. (NYSE:DOCN), the simplest scalable cloud for digital native enterprises, today announced results for its first quarter ended March 31, 2025. "The momentum we generated in 2024 in both core cloud and AI continued into Q1, as we grew total revenue 14% year-over-year, our highest quarterly growth rate since Q3 2023, with AI ARR continuing to grow north of 160% year-over-year, and we delivered more than 50 new product features, over 5 times as many as we delivered

      5/6/25 7:00:00 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • DigitalOcean Introduces Managed Caching for Valkey

      Enables digital native enterprises to help reduce database load, improve response times, and optimize resource usage effortlessly DigitalOcean Holdings, Inc. (NYSE:DOCN), the simplest scalable cloud for digital native enterprises, today announced the general availability of DigitalOcean Managed Caching for Valkey, a high-performance caching solution designed to help enhance application speed and scalability. This new offering will replace the current Managed Caching offering, and expand upon its capabilities with exciting new developer tools, including enhanced multi-threading capabilities, dual-channel replication, and new dictionary structure with experimental RDMA support. Managed Cach

      4/24/25 4:15:00 PM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology

    $DOCN
    Financials

    Live finance-specific insights

    See more
    • DigitalOcean Announces First Quarter 2025 Financial Results

      Q1 2025 Revenue of $211 million, up 14% year-over-year Q1 2025 Net Income was $38 million, up 170% year-over-year, at 18% margin and Adjusted EBITDA was $86 million, up 16% year-over-year, at 41% margin DigitalOcean Holdings, Inc. (NYSE:DOCN), the simplest scalable cloud for digital native enterprises, today announced results for its first quarter ended March 31, 2025. "The momentum we generated in 2024 in both core cloud and AI continued into Q1, as we grew total revenue 14% year-over-year, our highest quarterly growth rate since Q3 2023, with AI ARR continuing to grow north of 160% year-over-year, and we delivered more than 50 new product features, over 5 times as many as we delivered

      5/6/25 7:00:00 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • DigitalOcean Announces Date of First Quarter 2025 Earnings Conference Call

      DigitalOcean Holdings, Inc. (NYSE:DOCN), the simplest scalable cloud for digital native enterprises, announced today that it will report financial results for the first quarter ended March 31, 2025 before the market opens on Tuesday, May 6, 2025. The company will also hold a conference call on the same day at 8 a.m. ET / 5 a.m. PT to discuss its financial results and financial outlook with the investment community. Investors and analysts can pre-register for the webcast at https://events.q4inc.com/attendee/492751082. The earnings release, webcast link and any accompanying materials will be posted to the DigitalOcean investor relations website at http://investors.digitalocean.com. A live w

      4/15/25 8:30:00 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • DigitalOcean Announces Fourth Quarter and Fiscal Year 2024 Financial Results

      Q4 2024 Revenue of $205 million, up 13% year-over-year; Full year 2024 revenue of $781 million, up 13% year-over-year 2024 Net Income was $84 million, up 335% year-over-year, at 11% margin and Adjusted EBITDA was $328 million, up 19% year-over-year, at 42% margin DigitalOcean Holdings, Inc. (NYSE:DOCN), the simplest scalable cloud for growing tech companies, today announced results for its fourth quarter and fiscal year ended December 31, 2024. "We are entering 2025 with increasing momentum - in Q4 alone, we released more than four times as many products and features than we did in Q4 of the prior year, increased net dollar retention to 99%, grew revenue 13% year-over-year and deliver

      2/25/25 7:05:00 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology

    $DOCN
    Analyst Ratings

    Analyst ratings in real time. Analyst ratings have a very high impact on the underlying stock. See them live in this feed.

    See more
    • Citigroup initiated coverage on DigitalOcean with a new price target

      Citigroup initiated coverage of DigitalOcean with a rating of Buy and set a new price target of $45.00

      1/24/25 7:26:23 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • Cantor Fitzgerald initiated coverage on DigitalOcean with a new price target

      Cantor Fitzgerald initiated coverage of DigitalOcean with a rating of Neutral and set a new price target of $39.00

      1/17/25 7:35:58 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • DigitalOcean upgraded by Morgan Stanley with a new price target

      Morgan Stanley upgraded DigitalOcean from Equal-Weight to Overweight and set a new price target of $41.00 from $40.00 previously

      1/16/25 7:41:50 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology

    $DOCN
    Large Ownership Changes

    This live feed shows all institutional transactions in real time.

    See more
    • SEC Form SC 13G filed by DigitalOcean Holdings Inc.

      SC 13G - DigitalOcean Holdings, Inc. (0001582961) (Subject)

      11/13/24 10:09:04 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • Amendment: SEC Form SC 13G/A filed by DigitalOcean Holdings Inc.

      SC 13G/A - DigitalOcean Holdings, Inc. (0001582961) (Subject)

      11/12/24 2:34:08 PM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • Amendment: SEC Form SC 13G/A filed by DigitalOcean Holdings Inc.

      SC 13G/A - DigitalOcean Holdings, Inc. (0001582961) (Subject)

      11/4/24 1:09:50 PM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology

    $DOCN
    Insider Trading

    Insider transactions reveal critical sentiment about the company from key stakeholders. See them live in this feed.

    See more
    • Chief Product & Tech Officer Saha Bratin covered exercise/tax liability with 3,572 shares and sold $92,962 worth of shares (3,461 units at $26.86), decreasing direct ownership by 2% to 394,367 units (SEC Form 4)

      4 - DigitalOcean Holdings, Inc. (0001582961) (Issuer)

      4/21/25 4:25:23 PM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • Director Adelman Warren J was granted 657 shares, increasing direct ownership by 1% to 61,243 units (SEC Form 4)

      4 - DigitalOcean Holdings, Inc. (0001582961) (Issuer)

      4/2/25 4:30:19 PM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • Director Keffer Pueo was granted 432 shares, increasing direct ownership by 1% to 30,787 units (SEC Form 4)

      4 - DigitalOcean Holdings, Inc. (0001582961) (Issuer)

      4/2/25 4:27:50 PM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology

    $DOCN
    Leadership Updates

    Live Leadership Updates

    See more
    • DigitalOcean Welcomes Cloud & AI Developer Community to Deploy 2025 Conference

      DigitalOcean debuts vision for future of cloud, AI for digital-native businesses DigitalOcean, the simplest scalable cloud for growing tech companies, today kicked off its Deploy 25 customer conference in Austin, Texas bringing together the most passionate community of builders to share best practices, network, and experience DigitalOcean's vision for the future of cloud computing and AI. The event features keynote presentations from DigitalOcean leadership and customers, the unveiling of new innovations in cloud and AI, as well as opportunities to learn from the rest of the DigitalOcean community. "2024 was another monumental year for DigitalOcean, featuring groundbreaking product inno

      1/22/25 10:55:00 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • DigitalOcean Hires Larry D'Angelo as Chief Revenue Officer

      30 year tech industry veteran will oversee the go-to-market strategy and drive rapid growth DigitalOcean Holdings, Inc. (NYSE:DOCN), the developer cloud optimized for startups and growing digital businesses, is pleased to announce the appointment of Larry D'Angelo as its new Chief Revenue Officer, effective today. In this role, D'Angelo will drive DigitalOcean's new business growth via direct sales and channel partnerships, customer success, customer support, and corporate communications. "Larry is a seasoned operator with rich experience scaling businesses, driving exceptional customer experience, and building world class organizations," said Paddy Srinivasan, CEO of DigitalOcean. "He

      7/22/24 8:00:00 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • DigitalOcean Hires Wade Wegner as Chief Ecosystem and Growth Officer

      Wegner will strengthen DigitalOcean's position within the developer community and further fuel growth DigitalOcean Holdings, Inc. (NYSE:DOCN), the developer cloud optimized for startups and growing technology businesses, announced today that Wade Wegner joined the company as Chief Ecosystem and Growth Officer. This unique and critical position bridges the gap between research and development and go-to-market strategy. In this executive role, Wegner will oversee Developer Relations, Marketing, Growth, and Partnerships. "Wade is a transformative technology leader who blends deep technical expertise with strategic vision," said Paddy Srinivasan, CEO DigitalOcean. "He brings robust develope

      7/8/24 4:05:00 PM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology

    $DOCN
    SEC Filings

    See more
    • SEC Form 10-Q filed by DigitalOcean Holdings Inc.

      10-Q - DigitalOcean Holdings, Inc. (0001582961) (Filer)

      5/6/25 4:03:14 PM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • DigitalOcean Holdings Inc. filed SEC Form 8-K: Entry into a Material Definitive Agreement, Termination of a Material Definitive Agreement, Results of Operations and Financial Condition, Financial Statements and Exhibits, Creation of a Direct Financial Obligation

      8-K - DigitalOcean Holdings, Inc. (0001582961) (Filer)

      5/6/25 7:03:12 AM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology
    • SEC Form DEFA14A filed by DigitalOcean Holdings Inc.

      DEFA14A - DigitalOcean Holdings, Inc. (0001582961) (Filer)

      4/25/25 4:44:10 PM ET
      $DOCN
      Computer Software: Programming Data Processing
      Technology