On July 10, DigitalOcean Holdings fell 5.13% in regular trading, trading at $132.535/share, with turnover of $59.38 million. The decline came as the market digested UBS's bearish reassessment of the company's growth trajectory.

UBS slashed its price target on DigitalOcean from $175 to $155 while maintaining a neutral rating, arguing that the company's better-than-expected preliminary Q2 results were driven by positive business momentum rather than any material or structural business change. UBS noted that the Richmond data center, which came online in March, is now running near full capacity, and that ramping the newly launched Kansas City facility will be the key swing factor for Q3 revenue. The firm also stated that a longer-than-expected backlog duration does not represent a broader shift toward multi-year contracts.

DigitalOcean had pre-announced Q2 revenue growth of approximately 29% year over year, with remaining performance obligations expected to exceed $800 million — a more than ten-fold increase from the prior year. Bank of America previously identified the company as a core agentic AI beneficiary, projecting revenue growth exceeding 50% in fiscal year 2027.

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