Overview

* DigitalOcean Q2 2025 revenue rises 14% yr/yr, beating analyst expectations

* Net income for Q2 2025 increases 93% yr/yr to $37 mln

* Company raises full-year revenue guidance to $888-$892 mln

Outlook

* DigitalOcean ( DOCN ) sees Q3 revenue of $226 mln to $227 mln

* Company expects full-year revenue of $888 mln to $892 mln

* DigitalOcean ( DOCN ) forecasts Q3 adjusted EBITDA margin of 39% to 40%

* Company anticipates full-year adjusted EBITDA margin of 39% to 40%

Result Drivers

* INCREMENTAL ARR - Achieved highest incremental ARR since Q4 2022, with $32 mln added in Q2 2025

* AI/ML REVENUE GROWTH - More than doubled its AI/ML revenue year-over-year, per CEO Paddy Srinivasan

* SCALERS+ REVENUE - Revenue from higher spending digital native enterprises grew 35% year-over-year, now representing 24% of total revenue

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q2 Beat $218.70 $216.60

Revenue mln mln (12

Analysts

)

Q2 Net $37.03

Income mln

Q2 Gross $130.94

Profit mln

Q2 $42.45

Pretax mln

Profit

Analyst Coverage

* The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 8 "strong buy" or "buy", 5 "hold" and 1 "sell" or "strong sell"

* The average consensus recommendation for the it services & consulting peer group is "buy"

* Wall Street's median 12-month price target for DigitalOcean Holdings Inc ( DOCN ) is $37.50, about 28% above its August 4 closing price of $27.01

* The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 15 three months ago

Press Release:

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)