Abstract
DigitalOcean Holdings, Inc. will report fiscal results on February 24, 2026 Pre-Market, with investor attention on revenue growth, margins, and EPS consistency as the company updates its guidance for the current quarter.
Market Forecast
Market models indicate DigitalOcean Holdings, Inc.’s current quarter revenue is projected at $237.70 million, an estimated year-over-year increase of 18.55%; consensus anticipates adjusted EPS of $0.38 and EBIT of $58.89 million, with year-over-year growth of 12.08% and 35.81%, respectively. Forecast commentary points to a gross profit margin that remains near the upper-50% range, and a stable to improving net profitability profile; the company’s last reported guidance implied mid-to-high teens revenue growth alongside incremental operating leverage. The core cloud infrastructure and developer-focused services remain the main business, with continued momentum in managed databases, storage, and networking supporting expansion. The most promising growth vector is higher-value managed services that drive increased average revenue per user and reduced churn, expected to expand at a faster clip than core compute; however, revenue and YoY specifics are not disclosed.
Last Quarter Review
DigitalOcean Holdings, Inc.’s previous quarter delivered revenue of $229.63 million, a gross profit margin of 59.63%, GAAP net profit attributable to the parent company of $158.00 million, a net profit margin of 68.97%, and adjusted EPS of $0.54, with revenue growing 15.69% year-over-year and adjusted EPS up 3.85% year-over-year. Net income rose quarter-on-quarter by 327.72%, indicating substantial operating and non-operating leverage effects versus the prior quarter. The main business continued to benefit from usage expansion across SMB and developer customers, though the company did not disclose a formal revenue split by segment in the last filing.
Current Quarter Outlook (with major analytical insights)
Core Cloud Infrastructure and Developer Platform
Core compute, storage, and networking services remain the economic engine for DigitalOcean Holdings, Inc., and the company’s guidance and market estimates imply another quarter of mid-to-high teens revenue growth, supported by healthy net dollar retention within its SMB and developer base. With forecast revenue at $237.70 million and EBIT at $58.89 million, implied operating margin expansion suggests disciplined spend and continued efficiencies in support and infrastructure. The last quarter’s gross margin of 59.63% provides a base from which incremental scale, optimized mix, and lower unit costs can sustain margin resilience in the high-50% range this quarter. Investors will be sensitive to signals on customer adds and cohort monetization, as management has emphasized product simplicity and transparent pricing as differentiation against hyperscalers. Upside could come from better-than-expected usage growth driven by new workloads and stronger seasonal activity; downside risk centers on competitive discounting and macro-driven optimization by smaller customers.
Managed Services and High-Value Add-ons
Managed databases, Kubernetes, serverless functions, marketplaces, and security add-ons are increasingly important to DigitalOcean Holdings, Inc.’s ARPU expansion and retention. While the company hasn’t provided a granular split for the last quarter, the qualitative trajectory suggests these services are outgrowing core compute and lifting the revenue mix toward higher gross margin offerings. If adoption continues, the contribution from these add-ons can elevate overall gross profit and temper infrastructure cost volatility, supporting the forecasted adjusted EPS of $0.38 despite ongoing investments. Key watch items include attach rates for managed databases and Kubernetes, and progress in cross-sell programs within existing cohorts. Any improvement in attach rates directly supports operating leverage by increasing revenue per customer without proportional cost increases.
Stock Price Sensitivities: Profitability, Churn, and Guidance
Share performance into and after the print is likely to hinge on three elements: profitability cadence, churn and net dollar retention trends, and forward guidance versus consensus. The prior quarter’s unusually high GAAP net margin of 68.97% is not expected to be a recurring run-rate given possible non-operating items and one-time accounting effects; investors will focus on normalized operating profit and adjusted EPS. Churn dynamics within SMB cohorts will be closely scrutinized because revenue durability and expansion motion drive both growth and valuation multiples. Finally, management’s commentary on the revenue growth path and investment pace will be pivotal for multiple compression or expansion; confirming high-teens growth with sustained margin discipline would likely be taken positively, while any deceleration or step-up in costs could weigh on sentiment.
Analyst Opinions
Cumulative analyst previews over the past months show a majority leaning bullish, citing resilient mid-to-high teens growth and improving profitability metrics as catalysts. Several well-followed institutions highlight DigitalOcean Holdings, Inc.’s continued ability to convert usage expansion into cash flow, and they point to operating discipline as a differentiator among SMB-focused cloud providers. The bullish camp emphasizes the forecasted 18.55% year-over-year revenue growth and 35.81% EBIT growth as supportive of valuation, while acknowledging that competitive intensity remains a structural consideration. The minority cautious voices flag potential macro headwinds for small and medium businesses and possible spending optimizations that could temper usage-based upside. Overall, the prevailing view expects a clean quarter aligned with, or modestly above, consensus on revenue and adjusted EPS, with guidance being the key swing factor for the stock’s next move.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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