DigitalOcean Holdings, Inc. Earnings Recaps
Q1 2026
May 6, 2026
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.
Key takeaways
- 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.
Q3 2025
Nov 7, 2025
DigitalOcean delivered a robust third quarter, outperforming expectations with 16% revenue growth and record organic ARR, bolstered by strong demand from AI-native and digital enterprise customers.
Key takeaways
- Revenue reached $230 million, the highest growth rate since Q3 2023, with $44 million in organic incremental ARR.
- Adjusted EBITDA and non-GAAP EPS exceeded guidance, achieving a trailing 12-month adjusted free cash flow margin of 21%.
- Revenue from customers with over $1 million in annual run rate grew 72% year-over-year, highlighting increased retention and spending.
- The company's expanding AI infrastructure is attracting significant traction among major AI-native companies, enhancing future growth potential.
- DigitalOcean's balance sheet was strengthened through strategic equipment leasing and the repurchase of its 2026 convertible debt.