Overview
DigitalOcean Q3 rev rises 16% yr/yr to $230 mln, beating analyst expectations
Net income for Q3 surged 381% yr/yr due to one-time tax benefit and debt gain
Company raises full-year 2025 revenue and profitability outlook
Outlook
DigitalOcean expects Q4 revenue of $237 to $238 mln
Company raises 2025 revenue guidance to $896 to $897 mln
DigitalOcean forecasts 2025 adjusted EBITDA margin of 40.7% to 41%
Result Drivers
AI DEMAND - Direct AI revenue more than doubled year-over-year for the fifth consecutive quarter, driving growth
LARGER CLIENTS - Customers with annual run-rate over $1 mln grew 72% yr/yr, driving $110 mln total ARR
AGENTIC CLOUD PLATFORM - Unified agentic cloud platform gaining momentum among AI and digital native enterprises
DigitalOcean shares jumped 10.8% in premarket trading.
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Revenue | Beat | $229.63 mln | $226.50 mln (11 Analysts) |
Q3 Net Income | $158.37 mln | ||
Q3 Gross Profit | $136.93 mln | ||
Q3 Pretax Profit | $90.31 mln |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 7 "strong buy" or "buy", 5 "hold" and 1 "sell" or "strong sell"
The average consensus recommendation for the it services & consulting peer group is "buy"
Wall Street's median 12-month price target for DigitalOcean Holdings Inc is $40.00, about 2.9% above its November 4 closing price of $38.82
The stock recently traded at 18 times the next 12-month earnings vs. a P/E of 14 three months ago
Press Release: ID:nBw1D0k2Da