DigitalOcean’s Q1 results beat expectations, driving a +48.0% stock surge, fueled by accelerating revenue growth, rapidly expanding AI and large customer base, and an optimistic raised guidance for 2026 and 2027.

• Q1 revenue reached $258 million, up 22% year-over-year, reflecting acceleration from an 18% growth exit rate in Q4 2025.
• AI customer ARR surged 221% to $170 million, while $1 million-plus customer ARR climbed 179% to $183 million, demonstrating deepening adoption among large, high-value clients.
• Record $62 million incremental organic ARR added—the highest in company history—supported by a 1,700% year-over-year increase in Remaining Performance Obligations (RPO) to $243 million.
• Adjusted EBITDA margin stood at a healthy 41%, with trailing twelve-month adjusted free cash flow margins at 18%, indicating strong underlying profitability amid growth.
• Management raised 2026 revenue growth guidance from 21% to approximately 26%, and projected 2027 growth of 50% or more, driven by committed capacity expansion adding 60 megawatts slated to ramp in 2027.