DigitalOcean (DOCN)
Market Price (11/13/2026): $90.56 | Market Cap: $10.7 BilSector: Information Technology | Industry: Internet Services & Infrastructure
DigitalOcean (DOCN)
Market Price (11/13/2026): $90.56Market Cap: $10.7 BilSector: Information TechnologyIndustry: Internet Services & Infrastructure
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 34% Valuation becoming less expensiveP/S 6M Chg %Price/Sales change over 6 months. Declining P/S indicates valuation has become less expensive. is -42% Megatrend and thematic driversMegatrends include Cloud Computing. Themes include Infrastructure as a Service (IaaS), and Platform as a Service (PaaS). | Expensive valuation multiplesP/EBITPrice/EBIT or Price/(Operating Income) ratio is 114x, P/EPrice/Earnings or Price/(Net Income) is 302x Significant share based compensationSBC/Rev LTMShare Based Compensation / Revenue (Sales), Last Twelve Months (LTM) is 10% Yield minus risk free rate is negativeERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is -5.0% Key risksDOCN key risks include [1] intense competition from hyperscale cloud providers threatening its market share and [2] scrutiny over its specific financial health, Show more. |
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 34% |
| Valuation becoming less expensiveP/S 6M Chg %Price/Sales change over 6 months. Declining P/S indicates valuation has become less expensive. is -42% |
| Megatrend and thematic driversMegatrends include Cloud Computing. Themes include Infrastructure as a Service (IaaS), and Platform as a Service (PaaS). |
| Expensive valuation multiplesP/EBITPrice/EBIT or Price/(Operating Income) ratio is 114x, P/EPrice/Earnings or Price/(Net Income) is 302x |
| Significant share based compensationSBC/Rev LTMShare Based Compensation / Revenue (Sales), Last Twelve Months (LTM) is 10% |
| Yield minus risk free rate is negativeERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is -5.0% |
| Key risksDOCN key risks include [1] intense competition from hyperscale cloud providers threatening its market share and [2] scrutiny over its specific financial health, Show more. |
Qualitative Assessment
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Nov 11: up 9.6% in one day (S&P 500 up 1.3%)
The stock gained without company news as the broader market saw a "big sigh of relief" and investors ran back to AI stocks. This aligns with DigitalOcean being the "AI-Native Cloud."
Up 27.4% since its Nov 5 low (S&P 500 up 3.3%)
The stock gained significantly without company-specific news, benefiting from broader market relief rallies and a return to AI stock investment. This included an 8.0% gain on November 9 amid a broad-based relief rally, and continued on November 11 as investors ran back to AI stocks.
Nov 3: up 0.8% on its earnings report (S&P 500 up 0.3%)
The company reported third quarter 2026 financial results, with diluted EPS of $-0.37, while other headlines stated earnings and revenues topped estimates with $0.45 per share. The stock saw a slight gain, suggesting the positive news was partially offset.
Nov 11: up 9.6% in one day (S&P 500 up 1.3%)
The stock gained without company news as the broader market saw a "big sigh of relief" and investors ran back to AI stocks. This aligns with DigitalOcean being the "AI-Native Cloud."
Up 27.4% since its Nov 5 low (S&P 500 up 3.3%)
The stock gained significantly without company-specific news, benefiting from broader market relief rallies and a return to AI stock investment. This included an 8.0% gain on November 9 amid a broad-based relief rally, and continued on November 11 as investors ran back to AI stocks.
Nov 3: up 0.8% on its earnings report (S&P 500 up 0.3%)
The company reported third quarter 2026 financial results, with diluted EPS of $-0.37, while other headlines stated earnings and revenues topped estimates with $0.45 per share. The stock saw a slight gain, suggesting the positive news was partially offset.
Show less
Stock Movement Drivers
Fundamental Drivers
The -23.3% change in DOCN stock from 7/31/2026 to 11/12/2026 was primarily driven by a -87.6% change in the company's Net Income Margin (%).| (LTM values as of) | 7312026 | 11122026 | Change |
|---|---|---|---|
| Stock Price ($) | 117.50 | 90.07 | -23.3% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 949 | 1,103 | 16.2% |
| Net Income Margin (%) | 25.0% | 3.1% | -87.6% |
| P/E Multiple | 46.2 | 301.5 | 553.2% |
| Shares Outstanding (Mil) | 93 | 115 | -18.9% |
| Cumulative Contribution | -23.3% |
Market Drivers
7/31/2026 to 11/12/2026| Return | Correlation | |
|---|---|---|
| DOCN | -23.3% | |
| Market (SPY) | 1.4% | 57.6% |
| Sector (XLK) | -0.9% | 72.0% |
Fundamental Drivers
The -6.6% change in DOCN stock from 4/30/2026 to 11/12/2026 was primarily driven by a -89.2% change in the company's Net Income Margin (%).| (LTM values as of) | 4302026 | 11122026 | Change |
|---|---|---|---|
| Stock Price ($) | 96.43 | 90.07 | -6.6% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 901 | 1,103 | 22.3% |
| Net Income Margin (%) | 28.8% | 3.1% | -89.2% |
| P/E Multiple | 34.1 | 301.5 | 784.4% |
| Shares Outstanding (Mil) | 92 | 115 | -20.1% |
| Cumulative Contribution | -6.6% |
Market Drivers
4/30/2026 to 11/12/2026| Return | Correlation | |
|---|---|---|
| DOCN | -6.6% | |
| Market (SPY) | 5.6% | 48.7% |
| Sector (XLK) | 9.1% | 62.5% |
Fundamental Drivers
The 121.5% change in DOCN stock from 10/31/2025 to 11/12/2026 was primarily driven by a 929.3% change in the company's P/E Multiple.| (LTM values as of) | 10312025 | 11122026 | Change |
|---|---|---|---|
| Stock Price ($) | 40.66 | 90.07 | 121.5% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 833 | 1,103 | 32.4% |
| Net Income Margin (%) | 15.2% | 3.1% | -79.5% |
| P/E Multiple | 29.3 | 301.5 | 929.3% |
| Shares Outstanding (Mil) | 91 | 115 | -20.6% |
| Cumulative Contribution | 121.5% |
Market Drivers
10/31/2025 to 11/12/2026| Return | Correlation | |
|---|---|---|
| DOCN | 121.5% | |
| Market (SPY) | 11.9% | 43.3% |
| Sector (XLK) | 16.0% | 56.7% |
Fundamental Drivers
The 340.2% change in DOCN stock from 10/31/2023 to 11/12/2026 was primarily driven by a 234.4% change in the company's P/S Multiple.| (LTM values as of) | 10312023 | 11122026 | Change |
|---|---|---|---|
| Stock Price ($) | 20.46 | 90.07 | 340.2% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 650 | 1,103 | 69.6% |
| P/S Multiple | 2.8 | 9.4 | 234.4% |
| Shares Outstanding (Mil) | 89 | 115 | -22.4% |
| Cumulative Contribution | 340.2% |
Market Drivers
10/31/2023 to 11/12/2026| Return | Correlation | |
|---|---|---|
| DOCN | 340.2% | |
| Market (SPY) | 87.3% | 48.5% |
| Sector (XLK) | 115.7% | 53.7% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| DOCN Return | 89% | -68% | 44% | -7% | 41% | 87% | 112% |
| Peers Return | 34% | -30% | 54% | 27% | 19% | -3% | 112% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | 11% | 103% |
Monthly Win Rates [3] | |||||||
| DOCN Win Rate | 60% | 25% | 67% | 42% | 67% | 73% | |
| Peers Win Rate | 68% | 28% | 70% | 60% | 50% | 44% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 45% | |
Max Drawdowns [4] | |||||||
| DOCN Max Drawdown | - | -71% | -60% | -33% | -45% | -61% | |
| Peers Max Drawdown | -14% | -40% | -19% | -21% | -32% | -36% | |
| S&P 500 Max Drawdown | -5% | -25% | -10% | -8% | -19% | -9% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: AMZN, MSFT, GOOGL, AKAM, ORCL.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 11/12/2026 (YTD)
How Low Can It Go
| Event | DOCN | S&P 500 |
|---|---|---|
| 2025 US Tariff Shock | ||
| % Loss | -41.5% | -18.8% |
| % Gain to Breakeven | 70.9% | 23.1% |
| Time to Breakeven | 211 days | 79 days |
| 2024 Yen Carry Trade Unwind | ||
| % Loss | -13.0% | -7.8% |
| % Gain to Breakeven | 15.0% | 8.5% |
| Time to Breakeven | 4 days | 18 days |
| Summer-Fall 2023 Five Percent Yield Shock | ||
| % Loss | -59.3% | -9.5% |
| % Gain to Breakeven | 145.9% | 10.5% |
| Time to Breakeven | 737 days | 24 days |
| 2022 Inflation Shock & Fed Tightening | ||
| % Loss | -59.0% | -24.5% |
| % Gain to Breakeven | 144.0% | 32.4% |
| Time to Breakeven | 1406 days | 427 days |
In The Past
DigitalOcean's stock fell -41.5% during the 2025 US Tariff Shock. Such a loss loss requires a 70.9% gain to breakeven.
Preserve Wealth
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Asset Allocation
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| Event | DOCN | S&P 500 |
|---|---|---|
| 2025 US Tariff Shock | ||
| % Loss | -41.5% | -18.8% |
| % Gain to Breakeven | 70.9% | 23.1% |
| Time to Breakeven | 211 days | 79 days |
| Summer-Fall 2023 Five Percent Yield Shock | ||
| % Loss | -59.3% | -9.5% |
| % Gain to Breakeven | 145.9% | 10.5% |
| Time to Breakeven | 737 days | 24 days |
| 2022 Inflation Shock & Fed Tightening | ||
| % Loss | -59.0% | -24.5% |
| % Gain to Breakeven | 144.0% | 32.4% |
| Time to Breakeven | 1406 days | 427 days |
In The Past
DigitalOcean's stock fell -41.5% during the 2025 US Tariff Shock. Such a loss loss requires a 70.9% gain to breakeven.
Preserve Wealth
Limiting losses and compounding gains is essential to preserving wealth.
Asset Allocation
Actively managed asset allocation strategies protect wealth. Learn more.
About DigitalOcean (DOCN)
DigitalOcean Holdings, Inc. operates a global cloud computing platform designed to provide on-demand infrastructure and platform tools. Essentially, it offers the foundational digital resources necessary for building, deploying, and scaling internet-based applications and services. Its core offerings include infrastructure solutions such as virtual servers (compute), storage, and networking capabilities.
Beyond basic infrastructure, DigitalOcean extends its services to include fully managed application, container, and database offerings. These managed services simplify complex IT operations, allowing users to easily deploy and scale their applications without needing to manage the underlying server infrastructure. The company's primary customers are developers, start-ups, and small to medium-sized businesses (SMBs) who seek accessible, scalable, and developer-friendly cloud solutions.
Customers utilize DigitalOcean's platform for a diverse range of use cases, including hosting web and mobile applications, e-commerce sites, media and gaming platforms, and various personal web projects. Its services are delivered internationally across North America, Europe, Asia, and other regions, catering to a broad user base comprising software engineers, researchers, data scientists, system administrators, and students.
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The AWS or Google Cloud for individual developers and small businesses.
A simplified and more affordable AWS or Google Cloud, built for developers and small teams.
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- Compute Infrastructure: Provides on-demand virtual servers and computing resources for running applications and workloads.
- Storage Infrastructure: Offers various storage solutions for data persistence, including block storage and object storage.
- Networking Infrastructure: Enables secure and scalable connectivity, traffic management, and private networking for cloud resources.
- Managed Application Offerings: Delivers fully managed services for deploying, running, and scaling web and mobile applications.
- Managed Container Offerings: Provides managed services for deploying and orchestrating containerized applications.
- Managed Database Offerings: Offers fully managed database services for popular database engines, handling operational complexities.
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DigitalOcean (DOCN) primarily serves a broad base of developers, start-ups, and small to medium-sized businesses (SMBs) through its self-service cloud computing platform. Due to the fragmented nature of its customer base and its business model as a cloud infrastructure provider, DigitalOcean does not typically have a few large, identifiable "major customers" that are public companies. Instead, its customer base can be categorized as follows:
- Developers and IT Professionals: This category includes software engineers, researchers, data scientists, and system administrators who utilize DigitalOcean's platform for building, deploying, and managing web and mobile applications, websites, and other digital infrastructure.
- Start-ups and Small to Medium-Sized Businesses (SMBs): Businesses of various sizes, particularly those in their early stages or with smaller IT budgets, leverage DigitalOcean for their core operations, including website hosting, e-commerce platforms, media and gaming applications, and managed services.
- Individuals (Students and Hobbyists): The platform also caters to individual users, such as students learning about cloud computing or hobbyists working on personal web projects and experimental applications.
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- Equinix, Inc. (EQIX)
- Digital Realty Trust, Inc. (DLR)
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Paddy Srinivasan, Chief Executive Officer
Paddy Srinivasan was appointed Chief Executive Officer of DigitalOcean in February 2024. He brings over 25 years of experience in technology leadership to the role. Before joining DigitalOcean, Srinivasan served as CEO at GoTo (formerly LogMeIn), a SaaS company providing cloud communication and IT management software. His career includes leadership positions at major technology companies such as Microsoft, Amazon (where he was General Manager for Data, Machine Learning Platform Services, Alexa AI), and Oracle. He also co-founded Opstera, a cloud monitoring and managed service provider, which was subsequently acquired by Avanade (a Microsoft-Accenture company).
Matt Steinfort, Chief Financial Officer
Matt Steinfort became DigitalOcean's Chief Financial Officer in January 2023. Prior to this role, he was the Chief Financial Officer at Zayo, a global communications infrastructure platform. Steinfort also founded Envysion, a video intelligence SaaS company, where he held the positions of President and CEO. His professional background includes leadership roles at ICG Communications, Level 3 Communications, Bain & Company, and Cambridge Technology Partners.
Vinay Kumar, Chief Product and Technology Officer
Vinay Kumar serves as the Chief Product and Technology Officer at DigitalOcean.
Cynthia Carpenter, Senior Vice President, People
Cynthia Carpenter holds the position of Senior Vice President, People at DigitalOcean.
Larry D'Angelo, Chief Revenue Officer
Larry D'Angelo is the Chief Revenue Officer for DigitalOcean.
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- Intense Competition and Hyperscaler Expansion: DigitalOcean operates in a highly competitive cloud computing market, facing formidable rivals such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud, as well as numerous smaller cloud providers. A significant risk is that these larger "hyperscale" cloud providers, with their vast resources and economies of scale, could more aggressively target the small and medium-sized business (SMB) segment, which is DigitalOcean's primary customer base. This heightened competition could lead to price wars, reduced market share, and pressure on DigitalOcean's pricing power and profitability.
- Customer Churn and Low Net Revenue Retention: DigitalOcean faces challenges with customer retention, as indicated by its net revenue retention rate. A low net revenue retention rate suggests that existing customers are not increasing their spending with the company over time, or that a notable portion of customers are leaving. This necessitates a continuous effort to acquire new customers to drive revenue growth, which can be more costly and less sustainable than growing revenue from existing clients.
- Debt Structure and Financial Fluctuations: The company is exposed to risks related to its financial structure, including approximately $1.5 billion in convertible notes, with a significant maturity in 2026. This debt represents a potential financial risk, as settling it through the issuance of new shares at current market prices could result in substantial shareholder dilution. Additionally, DigitalOcean faces challenges with fluctuations in financial results, making it difficult to project future outcomes and potentially leading to stock price volatility if expectations are not met.
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The clear emerging threat for DigitalOcean is the rise of highly specialized, developer-centric platforms that offer an even higher level of abstraction and opinionated workflows for specific application types (e.g., web applications, APIs, static sites). Companies like Vercel, Netlify, Render, and Railway are gaining significant traction by providing streamlined, often Git-driven deployment experiences that abstract away much of the infrastructure management, appealing directly to DigitalOcean's core customer base of developers, startups, and small to medium-sized businesses who prioritize simplicity and rapid deployment for specific workloads. These platforms represent a shift in how certain applications are built and deployed, potentially drawing developers away from more generalized cloud offerings.
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DigitalOcean (DOCN) is expected to drive future revenue growth over the next 2-3 years through several key strategies:
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Focus on Digital Native Enterprises (DNEs) and Scaling Larger Customers: DigitalOcean is increasingly concentrating its efforts on attracting and expanding relationships with larger Digital Native Enterprises and customers generating higher Annual Recurring Revenue (ARR). The company reported significant growth in its million-dollar customers, with a 123% year-over-year increase in ARR for this cohort in Q4 2025. This focus on scaling with larger, high-growth customers is a key driver as these accounts are accelerating faster than the broader market.
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Expansion into AI/ML Workloads and Inference Cloud Services: DigitalOcean is strategically positioning itself as a platform for AI and cloud-native companies, particularly for production AI workloads. The company's AI customer ARR grew 150% year-over-year in Q4 2025, constituting 12% of total ARR. A substantial portion (70%) of this AI revenue comes from inference services or general cloud, rather than bare metal GPU rentals, indicating a shift towards higher-value offerings. DigitalOcean is investing in GPU capacity and an inference cloud capability to capture this growing market segment.
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Increased Data Center Capacity: To support its anticipated growth, DigitalOcean plans to bring 31 megawatts of new data center capacity online in 2026. This significant infrastructure expansion, with facilities ramping throughout the year, is projected to enable the company to achieve an exit revenue growth rate above 25% by Q4 2026 and reach 30% growth in 2027.
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Product Innovation and Adoption of Higher-Value Managed Services: Continuous product development and the introduction of new features, such as remote MCP support, agent development kit, GPU observability, managed NFS, and multi-node GPU capabilities, are expected to contribute to revenue growth. Furthermore, the increasing adoption of managed services like Kubernetes and Databases, which saw approximately 20% year-over-year growth in early 2025, enhances customer stickiness and drives up average revenue per user (ARPU).
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Share Repurchases
- DigitalOcean has repurchased 2.4 million shares for $82 million in 2025, at an average price of approximately $35 per share.
- Cumulative share repurchases since its IPO reached $1.6 billion and 34.9 million shares through December 31, 2025.
- The company has a remaining $100 million share buyback authorization that extends through July 31, 2027.
Share Issuance
- In 2025, DigitalOcean recorded $4.355 million in proceeds from the issuance of common stock under its equity incentive plan.
- The company received $4.653 million in proceeds from the issuance of common stock under its employee stock purchase plan in 2025.
- Weighted average fully diluted shares outstanding for full-year 2025 were approximately 106 million to 107 million shares.
Capital Expenditures
- DigitalOcean's total capital expenditures were $266 million in 2025, $186 million in 2024, and $125 million in 2023.
- Capital expenditures for property and equipment were $129.086 million in 2025 and $178.167 million in 2024.
- The primary focus of capital expenditures is on investments in data centers and GPU capacity to accelerate growth, including securing approximately 30 megawatts of incremental data center capacity to support growth in 2026 and beyond.
Peer Outperformance in Internet Services & Infrastructure
| Industry | Names | 1Y med | 3Y med | 5Y med | Top 3 by 5Y |
|---|---|---|---|---|---|
| Electronic Manufacturing Services | 10 | 14.9% | 108.3% | 182.6% | FLEX 460% · TTMI 434% · JBL 310% |
| Technology Distributors | 9 | 55.8% | 62.5% | 63.9% | AVT 143% · SNX 130% · CNXN 79% |
| Semiconductor Materials & Equipment | 28 | 47.5% | 64.7% | 39.9% | AXTI 378% · KLAC 299% · LRCX 294% |
| Electronic Components | 24 | 24.2% | 72.6% | 36.1% | CLS 2090% · BELFA 1159% · APH 296% |
| Communications Equipment | 36 | 7.8% | 77.2% | 35.7% | AAOI 769% · LITE 580% · ANET 529% |
| Electronic Equipment & Instruments | 27 | -6.4% | 27.3% | 1.3% | PI 124% · OSIS 105% · KEYS 63% |
| Semiconductors | 55 | 14.5% | 46.0% | -3.8% | MU 958% · AVGO 607% · NVDA 449% |
| Technology Hardware, Storage & Peripherals | 21 | -14.8% | 86.9% | -16.0% | DELL 631% · WDC 591% · SMCI 518% |
| IT Consulting & Other Services | 30 | -18.6% | -1.6% | -23.4% | APLD 324% · IBM 147% · GIB -7% |
| Internet Services & Infrastructure ← | 6 | -9.6% | 40.1% | -24.9% | GDDY 58% · VRSN 35% · AKAM -22% |
| Application Software | 126 | -11.7% | -12.3% | -53.6% | PLTR 652% · FROG 199% · AGYS 154% |
| Systems Software | 71 | -8.2% | 20.7% | -61.8% | ZETA 293% · CRWD 223% · CVLT 148% |
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Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 197.94 |
| Mkt Cap | 2,895.0 |
| Rev LTM | 346,445 |
| Op Inc LTM | 104,366 |
| FCF LTM | 211 |
| FCF 3Y Avg | 2,207 |
| CFO LTM | 168,300 |
| CFO 3Y Avg | 137,232 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 17.9% |
| Rev Chg 3Y Avg | 16.6% |
| Rev Chg Q | 18.8% |
| QoQ Delta Rev Chg LTM | 4.4% |
| Op Inc Chg LTM | 20.0% |
| Op Inc Chg 3Y Avg | 26.0% |
| Op Mgn LTM | 13.1% |
| Op Mgn 3Y Avg | 14.2% |
| QoQ Delta Op Mgn LTM | 0.2% |
| CFO/Rev LTM | 34.0% |
| CFO/Rev 3Y Avg | 36.1% |
| FCF/Rev LTM | 4.2% |
| FCF/Rev 3Y Avg | 13.2% |
Valuation
| Median | |
|---|---|
| Name | |
| Mkt Cap | 2,895.0 |
| P/S | 7.8 |
| P/Op Inc | 27.2 |
| P/EBIT | 21.4 |
| P/E | 27.1 |
| P/CFO | 19.8 |
| Total Yield | 4.4% |
| Dividend Yield | 0.0% |
| FCF Yield 3Y Avg | 2.0% |
| D/E | 0.1 |
| Net D/E | 0.1 |
Price Behavior
| Market Price | $90.07 | |
| Market Cap ($ Bil) | 10.3 | |
| First Trading Date | 03/24/2021 | |
| Distance from 52W High | -50.3% | |
| 50 Days | 200 Days | |
| DMA Price | $114.41 | $112.75 |
| DMA Trend | down | up |
| Distance from DMA | -21.3% | -20.1% |
| 3M | 1YR | |
| Volatility | 91.1% | 89.0% |
| Downside Capture | 392.12 | 270.94 |
| Upside Capture | 232.68 | 305.06 |
| Correlation (S&P 500) | 58.7% | 43.7% |
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | 6.47 | 4.56 | 4.29 | 3.81 | 2.84 | 2.20 |
| Up Beta | 2.83 | 7.16 | 3.96 | 5.37 | 2.52 | 1.91 |
| Down Beta | 6.63 | 7.04 | 6.19 | 2.16 | 1.66 | 1.86 |
| Up Capture | 395% | 324% | 382% | 612% | 1484% | 7683% |
| Bmk +ve Days | 12 | 18 | 28 | 62 | 130 | 427 |
| Stock +ve Days | 9 | 17 | 27 | 57 | 126 | 376 |
| Down Capture | 695% | 345% | 367% | 263% | 172% | 113% |
| Bmk -ve Days | 10 | 25 | 36 | 64 | 121 | 325 |
| Stock -ve Days | 13 | 26 | 37 | 69 | 125 | 375 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with DOCN | |
|---|---|---|---|---|
| DOCN | 80.6% | 89.0% | 1.04 | - |
| Sector ETF (XLK) | 19.2% | 28.6% | 0.60 | 57.6% |
| Equity (SPY) | 11.8% | 13.7% | 0.55 | 43.7% |
| Gold (GLD) | -6.6% | 28.9% | -0.24 | 9.8% |
| Commodities (DBC) | 32.8% | 21.3% | 1.22 | 2.2% |
| Real Estate (VNQ) | 9.8% | 14.2% | 0.41 | -4.2% |
| Bitcoin (BTCUSD) | -28.5% | 43.4% | -0.66 | 18.6% |
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Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with DOCN | |
|---|---|---|---|---|
| DOCN | -3.1% | 73.5% | 0.27 | - |
| Sector ETF (XLK) | 16.7% | 26.5% | 0.57 | 57.5% |
| Equity (SPY) | 11.6% | 17.3% | 0.50 | 53.3% |
| Gold (GLD) | 16.2% | 19.2% | 0.68 | 7.3% |
| Commodities (DBC) | 8.2% | 19.6% | 0.30 | 6.8% |
| Real Estate (VNQ) | 1.4% | 18.9% | -0.04 | 33.1% |
| Bitcoin (BTCUSD) | 3.7% | 51.5% | 0.25 | 28.4% |
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Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with DOCN | |
|---|---|---|---|---|
| DOCN | 7.8% | 72.3% | 0.49 | - |
| Sector ETF (XLK) | 23.5% | 25.3% | 0.84 | 55.6% |
| Equity (SPY) | 15.5% | 18.0% | 0.73 | 51.2% |
| Gold (GLD) | 11.1% | 16.6% | 0.54 | 7.2% |
| Commodities (DBC) | 7.6% | 18.1% | 0.33 | 6.7% |
| Real Estate (VNQ) | 6.2% | 20.7% | 0.25 | 30.9% |
| Bitcoin (BTCUSD) | 58.4% | 66.3% | 0.98 | 26.1% |
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Returns Analyses
Earnings Returns History
Updated 11/12/2026| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 11/3/2026 | 0.8% | -12.8% | |
| 8/4/2026 | 1.4% | 2.0% | -14.4% |
| 5/5/2026 | 40.4% | 49.5% | 59.6% |
| 2/24/2026 | 5.9% | -1.7% | 43.3% |
| 11/5/2025 | 18.0% | 28.8% | 24.4% |
| 8/5/2025 | 28.9% | 9.4% | 18.6% |
| 5/6/2025 | -13.8% | -3.5% | -8.8% |
| 2/25/2025 | 9.8% | 8.6% | 2.2% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 15 | 13 | 14 |
| # Negative | 8 | 10 | 8 |
| Median Positive | 10.2% | 13.9% | 21.5% |
| Median Negative | -9.6% | -5.4% | -10.8% |
| Max Positive | 40.4% | 49.5% | 59.6% |
| Max Negative | -24.8% | -29.2% | -42.7% |
| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 11/3/2026 | 0.8% | -12.8% | |
| 8/4/2026 | 1.4% | 2.0% | -14.4% |
| 5/5/2026 | 40.4% | 49.5% | 59.6% |
| 2/24/2026 | 5.9% | -1.7% | 43.3% |
| 11/5/2025 | 18.0% | 28.8% | 24.4% |
| 8/5/2025 | 28.9% | 9.4% | 18.6% |
| 5/6/2025 | -13.8% | -3.5% | -8.8% |
| 2/25/2025 | 9.8% | 8.6% | 2.2% |
| 11/4/2024 | -13.5% | -5.7% | -4.8% |
| 8/8/2024 | 11.9% | 25.8% | 33.6% |
| 5/10/2024 | 10.2% | 14.5% | 12.6% |
| 2/21/2024 | 8.7% | 4.1% | 11.1% |
| 11/2/2023 | 16.6% | 15.4% | 44.9% |
| 8/3/2023 | -24.8% | -25.0% | -42.7% |
| 5/9/2023 | 0.6% | -0.4% | 28.6% |
| 2/16/2023 | 7.8% | -0.8% | 3.3% |
| 11/7/2022 | -4.3% | 5.2% | -5.5% |
| 8/8/2022 | -1.5% | 1.7% | -15.5% |
| 5/4/2022 | -18.1% | -29.2% | 9.4% |
| 2/24/2022 | 18.6% | 35.0% | 28.6% |
| 11/4/2021 | 11.4% | 13.9% | -11.1% |
| 8/5/2021 | -2.3% | -5.0% | 9.1% |
| 5/6/2021 | -5.6% | -16.5% | -10.6% |
| SUMMARY STATS | |||
| # Positive | 15 | 13 | 14 |
| # Negative | 8 | 10 | 8 |
| Median Positive | 10.2% | 13.9% | 21.5% |
| Median Negative | -9.6% | -5.4% | -10.8% |
| Max Positive | 40.4% | 49.5% | 59.6% |
| Max Negative | -24.8% | -29.2% | -42.7% |
SEC Filings
Expand for More| Report Date | Filing Date | Filing |
|---|---|---|
| 09/30/2026 | 11/03/2026 | 10-Q |
| 06/30/2026 | 08/04/2026 | 10-Q |
| 03/31/2026 | 05/05/2026 | 10-Q |
| 12/31/2025 | 02/24/2026 | 10-K |
| 09/30/2025 | 11/05/2025 | 10-Q |
| 06/30/2025 | 08/05/2025 | 10-Q |
| 03/31/2025 | 05/06/2025 | 10-Q |
| 12/31/2024 | 02/25/2025 | 10-K |
| 09/30/2024 | 11/04/2024 | 10-Q |
| 06/30/2024 | 08/08/2024 | 10-Q |
| 03/31/2024 | 05/10/2024 | 10-Q |
| 12/31/2023 | 02/21/2024 | 10-K |
| 09/30/2023 | 11/02/2023 | 10-Q |
| 06/30/2023 | 08/11/2023 | 10-Q |
| 03/31/2023 | 05/09/2023 | 10-Q |
| 12/31/2022 | 02/22/2023 | 10-K |
| Report Date | Filing Date | Filing |
|---|---|---|
| 09/30/2026 | 11/03/2026 | 10-Q |
| 06/30/2026 | 08/04/2026 | 10-Q |
| 03/31/2026 | 05/05/2026 | 10-Q |
| 12/31/2025 | 02/24/2026 | 10-K |
| 09/30/2025 | 11/05/2025 | 10-Q |
| 06/30/2025 | 08/05/2025 | 10-Q |
| 03/31/2025 | 05/06/2025 | 10-Q |
| 12/31/2024 | 02/25/2025 | 10-K |
| 09/30/2024 | 11/04/2024 | 10-Q |
| 06/30/2024 | 08/08/2024 | 10-Q |
| 03/31/2024 | 05/10/2024 | 10-Q |
| 12/31/2023 | 02/21/2024 | 10-K |
| 09/30/2023 | 11/02/2023 | 10-Q |
| 06/30/2023 | 08/11/2023 | 10-Q |
| 03/31/2023 | 05/09/2023 | 10-Q |
| 12/31/2022 | 02/22/2023 | 10-K |
| 09/30/2022 | 11/07/2022 | 10-Q |
| 06/30/2022 | 08/08/2022 | 10-Q |
| 03/31/2022 | 05/05/2022 | 10-Q |
| 12/31/2021 | 02/25/2022 | 10-K |
| 09/30/2021 | 11/05/2021 | 10-Q |
| 06/30/2021 | 08/06/2021 | 10-Q |
| 03/31/2021 | 05/07/2021 | 10-Q |
| 12/31/2020 | 03/24/2021 | 424B4 |
Recent Forward Guidance
Updated 11/4/2026Latest: Q3 2026 Earnings Reported 11/3/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q4 2026 Revenue | Reported | 348.00 Mil | 349.50 Mil | 351.00 Mil | 14.4% | Higher New | Guidance: 305.50 Mil for Q3 2026 | |
| Q4 2026 Revenue Growth | Reported | 44.0% | 44.5% | 45.0% | ||||
| Q4 2026 Adjusted EBITDA Margin | Reported | 42.0% | 42.5% | 43.0% | 4.0% | Higher New | Guidance: 38.5% for Q3 2026 | |
| Q4 2026 Non-GAAP Diluted Net Income Per Share | Reported | 0.3 | 0.31 | 0.32 | 6.9% | Higher New | Guidance: 0.29 for Q3 2026 | |
| Q4 2026 Fully Diluted Weighted Average Shares Outstanding | Reported | 128.00 Mil | 128.50 Mil | 129.00 Mil | ||||
| 2026 Revenue | Reported | 1.21 Bil | 1.21 Bil | 1.21 Bil | 2.9% | Raised | Guidance: 1.18 Bil for 2026 | |
| 2026 Revenue Growth | Reported | 34.0% | ||||||
| 2026 Adjusted EBITDA Margin | Reported | 41.0% | 41.5% | 42.0% | 2.5% | Raised | Guidance: 39.0% for 2026 | |
| 2026 Non-GAAP Diluted Net Income Per Share | Reported | 1.6 | 1.61 | 1.62 | 17.1% | Raised | Guidance: 1.38 for 2026 | |
| 2026 Fully Diluted Weighted Average Shares Outstanding | Reported | 122.00 Mil | 122.50 Mil | 123.00 Mil | ||||
| 2026 Adjusted Free Cash Flow Margin | Reported | 20.0% | 21.0% | 22.0% | 9.0% | Raised | Guidance: 12.0% for 2026 | |
| 2027 Revenue Growth | Reported | 60.0% | 60.0% | |||||
Prior: Q2 2026 Earnings Reported 8/4/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q3 2026 Revenue | Reported | 304.00 Mil | 305.50 Mil | 307.00 Mil | ||||
| Q3 2026 Adjusted EBITDA Margin | Reported | 38.0% | 38.5% | 39.0% | ||||
| Q3 2026 Non-GAAP Diluted Net Income Per Share | Reported | 0.28 | 0.29 | 0.3 | ||||
| 2026 Revenue | Reported | 1.17 Bil | 1.18 Bil | 1.18 Bil | ||||
| 2026 Adjusted EBITDA Margin | Reported | 38.5% | 39.0% | 39.5% | ||||
| 2026 Non-GAAP Diluted Net Income Per Share | Reported | 1.35 | 1.38 | 1.4 | ||||
| 2026 Adjusted Free Cash Flow Margin | Reported | 11.0% | 12.0% | 13.0% | ||||
Q1 2026 Earnings Reported 5/5/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q2 2026 Revenue | Reported | 272.00 Mil | 273.00 Mil | 274.00 Mil | ||||
| Q2 2026 Adjusted EBITDA Margin | Reported | 37.0% | 37.5% | 38.0% | ||||
| Q2 2026 Non-GAAP diluted net income per share | Reported | 0.2 | 0.22 | 0.23 | ||||
| 2026 Revenue | Reported | 1.13 Bil | 1.14 Bil | 1.15 Bil | 4.4% | Raised | Guidance: 1.09 Bil for 2026 | |
| 2026 Revenue Growth | Reported | 26.0% | Raised | |||||
| 2026 Adjusted EBITDA Margin | Reported | 37.0% | 38.0% | 39.0% | 1.0% | Raised | Guidance: 37.0% for 2026 | |
| 2026 Non-GAAP diluted net income per share | Reported | 1.1 | 1.15 | 1.2 | 31.4% | Raised | Guidance: 0.88 for 2026 | |
| 2026 Adjusted free cash flow margin | Reported | 9.0% | 10.5% | 12.0% | -5.5% | Lowered | Guidance: 16.0% for 2026 | |
| 2027 Revenue Growth | Reported | 50.0% | ||||||
Q4 2025 Earnings Reported 2/24/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q1 2026 Revenue | Reported | 249.00 Mil | 249.50 Mil | 250.00 Mil | 5.1% | Higher New | Guidance: 237.50 Mil for Q4 2025 | |
| Q1 2026 Adjusted EBITDA margin | Reported | 36.0% | 36.5% | 37.0% | -2.5% | Lower New | Guidance: 39.0% for Q4 2025 | |
| Q1 2026 Non-GAAP diluted net income per share | Reported | 0.22 | 0.25 | 0.27 | -34.7% | Lower New | Guidance: 0.38 for Q4 2025 | |
| 2026 Revenue | Reported | 1.07 Bil | 1.09 Bil | 1.10 Bil | 21.6% | Higher New | Guidance: 896.50 Mil for 2025 | |
| 2026 Adjusted EBITDA margin | Reported | 36.0% | 37.0% | 38.0% | -3.8% | Lower New | Guidance: 40.85% for 2025 | |
| 2026 Non-GAAP diluted net income per share | Reported | 0.75 | 0.88 | 1 | -56.8% | Lower New | Guidance: 2.03 for 2025 | |
| 2026 Adjusted free cash flow margin | Reported | 15.0% | 16.0% | 17.0% | -2.5% | Lower New | Guidance: 18.5% for 2025 | |
| 2026 Unlevered adjusted free cash flow margin | Reported | 18.0% | 19.0% | 20.0% | ||||
Insider Activity
Updated 10/2/2026| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Srinivasan, Padmanabhan T | Chief Executive Officer | Direct | Sell | 9222026 | 140.00 | 11,394 | 1,595,160 | 105,199,220 | Form |
| 2 | Barrett, Cherie | SVP, Chief Accounting Officer | Direct | Sell | 9032026 | 105.73 | 3,985 | 421,334 | 6,174,526 | Form |
| 3 | Steinfort, Matt | Chief Financial Officer | Direct | Sell | 9032026 | 105.73 | 10,000 | 1,057,300 | 53,255,355 | Form |
| 4 | Srinivasan, Padmanabhan T | Chief Executive Officer | Direct | Sell | 9032026 | 105.73 | 5,697 | 602,344 | 80,652,641 | Form |
| 5 | Srinivasan, Padmanabhan T | Chief Executive Officer | Direct | Sell | 8192026 | 129.11 | 5,697 | 735,540 | 101,131,863 | Form |
| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Srinivasan, Padmanabhan T | Chief Executive Officer | Direct | Sell | 9222026 | 140.00 | 11,394 | 1,595,160 | 105,199,220 | Form |
| 2 | Barrett, Cherie | SVP, Chief Accounting Officer | Direct | Sell | 9032026 | 105.73 | 3,985 | 421,334 | 6,174,526 | Form |
| 3 | Steinfort, Matt | Chief Financial Officer | Direct | Sell | 9032026 | 105.73 | 10,000 | 1,057,300 | 53,255,355 | Form |
| 4 | Srinivasan, Padmanabhan T | Chief Executive Officer | Direct | Sell | 9032026 | 105.73 | 5,697 | 602,344 | 80,652,641 | Form |
| 5 | Srinivasan, Padmanabhan T | Chief Executive Officer | Direct | Sell | 8192026 | 129.11 | 5,697 | 735,540 | 101,131,863 | Form |
| 6 | Barrett, Cherie | SVP, Chief Accounting Officer | Direct | Sell | 8172026 | 132.37 | 4,456 | 589,841 | 8,668,514 | Form |
| 7 | Adelman, Warren J | Direct | Sell | 8112026 | 124.01 | 4,200 | 520,855 | 8,362,569 | Form | |
| 8 | Steinfort, Matt | Chief Financial Officer | Direct | Sell | 6032026 | 170.07 | 10,000 | 1,700,700 | 91,568,069 | Form |
| 9 | Jenson, Warren | Direct | Sell | 5212026 | 147.62 | 20,000 | 2,952,400 | 4,797,207 | Form | |
| 10 | Steinfort, Matt | Chief Financial Officer | Direct | Sell | 5192026 | 152.50 | 25,000 | 3,812,500 | 87,423,980 | Form |
| 11 | Schneider, Hilary | Direct | Sell | 5192026 | 156.38 | 4,338 | 678,376 | 3,803,631 | Form | |
| 12 | Access, Industries Holdings Llc | LLC | Sell | 5152026 | 150.30 | 3,300,000 | 495,990,000 | 17,973,926 | Form | |
| 13 | Access, Industries Holdings Llc | LLC | Sell | 5112026 | 159.97 | 181,147 | 28,977,237 | 3,468,188,027 | Form | |
| 14 | Access, Industries Holdings Llc | LLC | Sell | 5112026 | 150.98 | 210,659 | 31,805,555 | 3,300,754,979 | Form | |
| 15 | Steinfort, Matt | Chief Financial Officer | Direct | Sell | 3032026 | 55.40 | 20,000 | 1,108,000 | 30,243,746 | Form |
| 16 | Barrett, Cherie | SVP, Chief Accounting Officer | Direct | Sell | 3032026 | 54.77 | 22,000 | 1,204,940 | 3,421,427 | Form |
Investor Activity (13F)
Updated Nov 13, 2026Active managers (13F portfolio over $250M, at least 3 holdings) with a position over $5M that is either over 10% of their portfolio or held in a concentrated book of 50 or fewer total positions. Index/ETF, sovereign, bank, community-bank and charitable/donor-advised filers are excluded.
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| Gladstone Capital Management LLP | $42.6 Mil | 4.3% | 32 | New | 13F |
| California First Leasing Corp | $7.5 Mil | 2.4% | 39 | Hold | 13F |
| Thames Capital Management LLC | $12.5 Mil | 2.2% | 43 | New | 13F |
| BWCP, LP | $11.9 Mil | 1.8% | 27 | New | 13F |
| Science & Technology Partners, L.P. | $5.9 Mil | 1.5% | 42 | New | 13F |
| Glenview Capital Management, LLC | $21.4 Mil | 0.6% | 41 | TRIM -87.5% | 13F |
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| Gladstone Capital Management LLP | $42.6 Mil | 4.3% | 32 | New | 13F |
| Glenview Capital Management, LLC | $21.4 Mil | 0.6% | 41 | TRIM -87.5% | 13F |
| Thames Capital Management LLC | $12.5 Mil | 2.2% | 43 | New | 13F |
| BWCP, LP | $11.9 Mil | 1.8% | 27 | New | 13F |
| California First Leasing Corp | $7.5 Mil | 2.4% | 39 | Hold | 13F |
| Science & Technology Partners, L.P. | $5.9 Mil | 1.5% | 42 | New | 13F |
DOCN Trade Sentinel
Constructive
CONVICTION RATIONALE
DigitalOcean's pivot to an AI-native cloud is driving a fifth consecutive quarter of accelerating revenue, now at 40% growth. Management's outlook for 60% or more growth in 2027 suggests this is a durable inflection. While aggressive data center investment is compressing near-term margins, a new financing facility and strong execution track record support the growth plan.
STOCK ARCHETYPE
Consumption-Based Cloud Services(Number of Customers) x (Usage per Customer) x (Price per Unit of Service) Increasing the 'yield per megawatt' by selling higher-value, software-defined AI services (like the inference engine and managed agents) on top of commodity infrastructure, which also pulls through consumption of higher-margin core cloud products.
INVESTMENT THESIS
Evidence suggests a successful strategic shift is underway, capturing massive demand for AI inference and agentic workloads from tech-native companies.
- Revenue growth accelerated for the fifth consecutive quarter to 40%.
- AI Customer ARR grew 288% year-over-year to $376 million.
- The number of customers spending over $1M annually nearly doubled to 51.
- Management raised its full-year 2027 revenue growth outlook to 60% or more.
PRIMARY RISK
Aggressive data center expansion has compressed gross margins to 50% from 60% a year ago. This is funded by a balance sheet with net debt at 4.0x EBITDA and a newly announced $1 billion equity program, creating significant financial and dilution risk if growth falters.
- Gross margin declined to 50% in Q3 2026 from 60% a year earlier.
- Net debt stands at $1.2 billion, or 3.99 times trailing-twelve-month EBITDA.
- Accounts receivable grew 65.7%, far outpacing 39.9% revenue growth.
- The company put a $1 billion at-the-market equity program in place.
| KPI | Status | Rationale |
|---|---|---|
| Annual Run-rate Revenue (ARR) | Approximately $1.28 billion as of the third quarter of 2026 - Accelerating | The company's overall revenue growth trajectory shows significant acceleration over the past year. Latest-quarter revenue grew 39.9% year-over-year, compared to 28.6% in the prior quarter and 22.4% two quarters prior. The CEO noted on the latest earnings call that this was the fifth consecutive quarter of acceleration. |
| AI Customer ARR | $376 million as of the third quarter of 2026 - Accelerating | Growth in this segment is accelerating dramatically, with year-over-year growth increasing from 150% four quarters ago to 288% in the latest quarter. This metric is the primary driver of the company's overall re-acceleration and represents a strategic pivot. |
| Digital Native Enterprise (DNE) Customers | 22,374 (as of 9/30/2026) | Represents the number of customers spending more than $500 per month, indicating the growth of the company's base of more substantial enterprise customers. |
| $1M+ Customers | 51 (as of 9/30/2026) | Tracks the number of the company's largest customers, who comprise a significant portion of revenue and revenue growth. This cohort grew from 26 a year prior. |
AI Hypergrowth vs. Funding Strain
BULL VIEW
Demand far outstrips supply, justifying the investment. The company is successfully capturing a niche the hyperscalers underserve, evidenced by 288% AI customer ARR growth and a guide for 60%+ revenue growth in 2027.
CORE TENSION
Can accelerating revenue, guided to 60%+ in 2027, outrun the margin compression and high leverage required to fund it?
PREVAILING SENTIMENT
The latest evidence favors the growth story. Management has consistently raised guidance, and the 60%+ outlook for 2027 suggests the investment is paying off in accelerating demand.
BEAR VIEW
The cost of growth is too high. Gross margins fell 10 points year-over-year to 50%, net debt is 4.0x EBITDA, and a $1B equity program signals dilution. This is a precarious financial position.
| Timeline | Event & Metric To Watch |
|---|---|
November 2026 | New Equipment Financing Commences Watch: New equipment financing arrangements commence, funding purchases of data center equipment. |
12/8/2026 - 2/3/2027 | Peer Competitive Announcements Watch: Peer commentary on pricing, capacity, or market share gains in the developer and SMB cloud segments. |
on or before maturity in December | Convertible Note Retirement Watch: Company plans to retire the remaining $312 million of its 2026 convertible notes. |
on our fourth quarter call in February | Detailed 2027 Guidance Issued Watch: Company will provide more detailed guidance for fiscal year 2027. |
1/26/2027 | Microsoft Earnings Report Watch: Peer Microsoft (MSFT) is scheduled to report earnings. |
2/2/2027 | Alphabet Earnings Report Watch: Peer Alphabet (GOOGL) is scheduled to report earnings. |
2/22/2027 | Failure to Meet Aggressive Growth Guidance Watch: Q4 revenue growth versus 44-45% guide; confirmation or revision of the 60%+ FY27 growth target. |
2/22/2027 | Company Reports Q4 Earnings Watch: Company is scheduled to report Q4 2026 earnings. |
WITHIN_SIX_MONTHS | Capacity Ramp Execution Delays Watch: Management commentary on data center ramp progress, utilization, and any supply chain or construction delays. |
| Date | Event | Stock Impact |
|---|---|---|
2026-11-03 | Q3 Earnings and Guidance Raise Details: The company announced Q3 revenue growth accelerated to 40% year-over-year and raised its outlook for Q4 and full-year 2027 revenue growth. | -6.4% $89.79 -> $84.02 |
2026-10-12 | Launched New AI Agent Services Details: The company announced Agent Learning and Data Services as a key element of its agentic stack, enabling teams to launch self-improving AI agents. | -4.9% $134.82 -> $128.21 |
2026-09-10 | Secured Major Equipment Financing Details: The company entered into a new $725 million equipment finance facility to fund capacity expansion, with an accordion option for additional financing. | -7.3% $132.67 -> $122.95 |
2026-08-04 | Q2 Earnings Report Details: The company announced second quarter 2026 financial results, with revenue growing 29% year-over-year and a record $93 million in incremental ARR. | -2.1% $127.17 -> $124.46 |
2026-07-24 | Debt Repurchase and Equity Offering Details: The company closed a repurchase of approximately $472 million of its 2030 convertible notes, funded by a concurrent registered direct offering of common stock to reduce leverage. | -8.3% $131.15 -> $120.20 |
2026-06-10 | New Executive Appointments Details: The company announced three additions to its executive leadership team: a Chief Revenue Officer, a Chief Marketing Officer, and a Chief Legal & Administrative Officer. | +3.8% $168.33 -> $174.75 |
2026-05-05 | Massive Post-Earnings Stock Reaction Details: The stock had a two-day reaction of 48.0% around the earnings call for the quarter ending March 2026, indicating an extremely positive market response to results and guidance. | +48.0% $108.81 -> $160.99 |
Position Sizing
1% - 2%
MINIMAL POSITION
Sizing is volatility-based: DOCN trades at roughly 85% annualized realized (three-month) volatility versus about 10% for the S&P 500 (8.6x the market). A 1% - 2% position keeps a single-name swing of that size within a diversified portfolio's risk budget.
Diversification Alternatives
AMZN - Amazon.com
Hyperscale LeaderOffers exposure to the largest, most established cloud platform with unmatched infrastructure scale, serving the biggest enterprise and AI training workloads. Amazon's AWS segment is also accelerating, growing 39.3%.
MSFT - Microsoft
Enterprise AI PlatformProvides a fully integrated software and cloud ecosystem, with deep enterprise penetration through its Azure platform. Microsoft's Azure revenue grew 48%, showing strong momentum in its own AI-driven services.
A specialized, high-growth AI cloud platform monetizing the shift to inference and agentic workloads for tech-forward SMBs and startups.
DigitalOcean has successfully pivoted from a general-purpose developer cloud to a specialized 'AI-Native Cloud'. It targets a niche underserved by complex hyperscalers and bare-metal GPU providers by offering an integrated, simple-to-use platform for building and deploying production AI applications. This strategy is driving significant revenue acceleration as AI-native companies adopt its full stack, increasing the revenue yield per dollar of infrastructure investment.
Continued acceleration in AI Customer ARR, sustained high growth in the $1M+ customer cohort, and management commentary on increasing ARR per megawatt would confirm the thesis.
A deceleration in revenue growth, a stall in AI customer adoption, or an inability to secure and bring online new data center capacity to meet demand would damage the thesis.
Short-term gross margin compression due to the timing of data center investments is expected and should be considered noise relative to the long-term growth trajectory.
Repricing Catalyst
The company's fifth consecutive quarter of accelerating revenue growth, a significant beat on Q3 2026 revenue guidance, and a substantial raise in its full-year 2026 and 2027 revenue growth outlook.
DigitalOcean — Investor Video Playlist
Industry Resources
| Information Technology Resources |
| TechCrunch |
| Wired |
| CIO |
| MIT Technology Review |
| Gartner Insights |
| Ars Technica |
| Internet Services & Infrastructure Resources |
| Data Center Dynamics |
| Data Center Frontier |
| Internet Society |
External Quote Links
| Y Finance | Barrons |
| TradingView | Morningstar |
| SeekingAlpha | ValueLine |
| Motley Fool | Robinhood |
| CNBC | Etrade |
| MarketWatch | Unusual Whales |
| YCharts | Perplexity Finance |
| FinViz |
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