DigitalOcean Holdings Inc

Latest Results (19.05.2026):

DigitalOcean Holdings Inc.'s results for the third quarter of 2025 (Q3 2025) show accelerating revenue and cash‑flow performance: revenue was $230 million (up 16% year‑over‑year), the company delivered its largest incremental organic ARR, reported materially improved profitability and raised full‑year 2025 revenue and adjusted free cash flow margin guidance.

Revenue & ARR

Q3 2025 revenue: $229.6M (reported as $230M), +16% YoY. ARR ended the quarter at $919M, also +16% YoY. Remaining performance obligation (RPO) rose to $47M from $10M in Q3 2024.

Profitability

Net income attributable to common stockholders: $158M (+381% YoY), driven in part by one‑time items. Adjusted EBITDA: $100M, +15% YoY, with an adjusted EBITDA margin of 43% for the quarter.

One‑time Items & Adjustments

Reported net income included a $70M one‑time income tax benefit from release of a valuation allowance and a $48M one‑time gain on partial extinguishment of 2026 Convertible Notes; these materially boosted GAAP net income versus underlying operating performance.

Cash Flow & Liquidity

Net cash from operating activities: $96M (42% margin for the quarter). Adjusted free cash flow: $85M (37% margin); unlevered adjusted free cash flow also $85M. Cash and cash equivalents: $237M as of Sept 30, 2025.

Customers & ARR Composition

Record incremental organic ARR of $44M (highest in company history). Customers with >$100k ARR grew 26% (these customers now represent 26% of revenue and their revenue grew 41% YoY). Customers with >$1M ARR contribute $110M ARR, +72% YoY.

AI & Product Momentum

DigitalOcean said its "unified agentic cloud" is gaining traction for AI workloads: direct AI revenue more than doubled YoY for the fifth consecutive quarter. The company launched features including Multi‑Modal AI model support, Function Calling and other Gradient™ AI Platform capabilities.

Capital Actions & Balance Sheet Moves

Repurchased ~ $1,188M principal of 2026 Convertible Notes at a $56M discount to par and recorded a related gain. Repurchased 0.1M shares in the quarter (cumulative buybacks since IPO: $1.6B and 34.9M shares). Long‑term debt decreased to $1.284B; total assets $1.726B and stockholders’ deficit narrowed vs prior year.

Guidance & Outlook

Q4 2025 guidance: revenue $237–238M; adjusted EBITDA margin 38.5–39.5%; non‑GAAP diluted EPS $0.35–0.40. Full‑year 2025 guidance raised to revenue $896–897M, adjusted EBITDA margin 40.7–41.0%, adjusted free cash flow margin 18–19%, and non‑GAAP diluted EPS $2.00–2.05.