NYSE$DOCN

DigitalOcean Holdings Inc. · Q2 2024 earnings

Q2 2024 earnings · · Investor relations

Briefing

DigitalOcean's Q2 2024 performance was marked by revenue growth, ARR increase, and strategic leadership additions.

DigitalOcean announced strong second-quarter results with revenue increasing by 13% year-over-year to $192 million. The company's ARR grew by 15% to $781 million, and it reported a net income of $19 million. They expanded their leadership team and saw AI/ML ARR increase significantly.

  • Revenue increased by 13% year-over-year, reaching $192 million.
  • ARR grew by 15% year-over-year, ending the quarter at $781 million.
  • Net income attributable to common stockholders was $19 million.
  • ARPU increased by 9% over the second quarter of 2023, reaching $99.45.

Headline financials

Total Revenue

$192M

Previous: $170M+13.3%
EPS (adj)

$0.48

Previous: $0.44+9.1%
Capital Expenditures

-$75.5M

Previous: -$46.8M-61.2%
Free Cash Flow

-$56.4M

Previous: -$46.2M-22.1%
Net Income

$19.1M

Previous: $665K+2777.9%
Operating Income

$22.3M

Previous: -$1.5M+1587.5%
Gross Profit

$117M

Previous: $102M+14.5%
Cash & Equivalents

$443M

Previous: $120M+269.1%
Total Assets

$1.54B

Previous: $1.5B+2.6%
R&D Expense

$34M

No prior period
Stock-Based Comp

$21.8M

No prior period

Revenue & EPS history

DigitalOcean · Revenue · Quarterly

$192M

Q2 2024+13.3%vs Q2 2023
Beat estimate in 13 of 15 quarters(87%)
ActualEstimate

Forward guidance

DigitalOcean provided guidance for the third quarter ending September 30, 2024, and updated its full-year 2024 guidance.

Tailwinds

  • Total revenue is expected to be between $196 to $197 million for Q3 2024.
  • Adjusted EBITDA margin is projected to be 37% to 38% for Q3 2024.
  • Non-GAAP diluted net income per share is expected to be $0.39 to $0.41 for Q3 2024.
  • Total revenue is projected to be between $770 to $775 million for the full year 2024.
  • Adjusted EBITDA margin is expected to be 37% to 39% for the full year 2024.

Headwinds

  • Adjusted free cash flow margin is expected to be in the range of 15% to 17% of revenue for the full year 2024.
  • Non-GAAP diluted net income per share is projected to be $1.60 to $1.70 for the full year 2024.
  • Fully diluted weighted average shares outstanding are expected to be approximately 102 to 103 million shares for Q3 2024.
  • Fully diluted weighted average shares outstanding are expected to be approximately 102 to 103 million shares for the full year 2024.
  • 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.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2024

Historical avgQ2 2024

+3.4%

Avg return

Earnings day

+6.1%

Avg return

5 days after

+9.3%

Avg return

30 days after

56%

14 / 25 earnings

Positive

+40.8%

Q1 2026

Best reaction

-25.3%

Q2 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+40.8%+51.1%+66.1%
Q4 2025+8.2%-5.4%+44.5%
Q3 2025+17.1%+33.1%+24.4%
Q1 2025-13.3%-11.0%-15.2%
Q4 2024+9.8%+15.3%-4.4%
Q3 2024-12.2%-5.7%-2.2%
Q2 2024+17.6%+29.6%+31.4%
Q1 2024+15.6%+19.0%+14.6%
Q4 2023+5.3%-2.2%+6.2%
Q3 2023+24.9%+32.5%+55.7%
Q2 2023-25.3%-23.3%-43.1%
Q1 2023-1.8%-2.6%+28.8%
Q4 2022+7.1%+2.0%+3.3%
Q3 2022-7.8%+8.3%-8.9%
Q2 2022+2.9%+6.4%-11.7%
Q1 2022-13.4%-21.8%+15.8%
Q4 2019+6.6%+13.9%+3.4%
Q4 2021+27.6%+29.4%+22.7%
Q3 2020+6.9%+2.3%-20.2%
Q3 2021+8.5%+23.4%-11.1%
Q2 2020-7.1%-2.8%+27.9%
Q2 2021-8.2%-2.0%+24.9%
Q4 2020-9.1%-11.5%-5.2%
Q1 2020-9.1%-11.5%-5.2%
Q1 2021-5.6%-14.5%-10.6%

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