Stock Track | DigitalOcean Plunges 5.96% in Night Session as Weak Forward Guidance Overshadows Q4 Beat

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DigitalOcean Holdings, Inc. (DOCN) experienced a significant 5.96% decline in its stock price during the night session. The sharp drop comes despite the company recently reporting better-than-expected fourth-quarter financial results.

The plunge appears to be driven by investor concerns over the company's forward-looking guidance. While DigitalOcean beat analyst expectations for Q4 with earnings of $0.44 per share versus the expected $0.38 and revenue of $242.4 million versus the expected $237.7 million, the company's outlook for the coming quarters fell significantly short of Wall Street estimates.

For the first quarter, DigitalOcean expects non-GAAP net income in the range of $0.22 to $0.27 per diluted share, well below the $0.45 analysts had anticipated. More concerning to investors is the full-year 2026 guidance of $0.75 to $1 in non-GAAP diluted net income, which is less than half of the $1.96 analysts were expecting according to FactSet polls.

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