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Mar 31, 2024
DigitalOcean Q1 2024 Earnings Report
DigitalOcean's Q1 2024 results were announced, showcasing revenue growth driven by core cloud performance and AI platform demand, alongside strong profitability.
Key Takeaways
DigitalOcean reported a strong start to 2024 with revenue increasing 12% year-over-year to $185 million. The company's profitability was also strong, with a net income margin of 8% and an adjusted EBITDA margin of 40%.
Revenue increased by 12% year-over-year, reaching $185 million.
ARR ended the quarter at $749 million, representing a 12% year-over-year growth.
Net income attributable to common stockholders was $14 million, with a net income margin of 8%.
Adjusted EBITDA increased by 33% year-over-year to $74 million, with an adjusted EBITDA margin of 40%.
Forward Guidance
DigitalOcean provided guidance for the second quarter of 2024 and full year 2024.
Positive Outlook
- Total revenue for Q2 2024 is expected to be $188 to $189 million.
- Adjusted EBITDA margin for Q2 2024 is expected to be 37% to 38%.
- Non-GAAP diluted net income per share for Q2 2024 is expected to be $0.38 to $0.40.
- Total revenue for full year 2024 is expected to be $760 to $775 million.
- Adjusted EBITDA margin for full year 2024 is expected to be 36% to 38%.
Challenges Ahead
- Adjusted free cash flow margin for the full year 2024 is expected to be in the range of 19% to 21% of revenue.
- Fully diluted weighted average shares outstanding for Q2 and full year 2024 are expected to be approximately 102 to 103 million shares.
- Uncertainty regarding expenses that may be incurred in the future.
- Stock-based compensation expense-related charges are impacted by the timing of employee stock transactions.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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