Cloud computing platform DigitalOcean (NYSE:DOCN) will be reporting earnings this Tuesday before market open. Here’s what investors should know.
DigitalOcean beat analysts’ revenue expectations last quarter, reporting revenues of $281.2 million, up 28.6% year on year. It was a very strong quarter for the company, with an impressive beat of analysts’ billings estimates and full-year EPS guidance exceeding analysts’ expectations.
Is DigitalOcean a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting DigitalOcean’s revenue to grow 33.5% year on year, improving from the 15.7% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. DigitalOcean has a history of exceeding Wall Street’s expectations.
Looking at DigitalOcean’s peers in the data and analytics software segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Commvault delivered year-on-year revenue growth of 13.1%, beating analysts’ expectations by 0.7%, and Strategy reported a revenue decline of 2.5%, falling short of estimates by 1.4%. Commvault’s stock price was unchanged after the resultswhile Strategy was down 7.8%.
Read our full analysis of Commvault’s results here and Strategy’s results here.
There has been positive sentiment among investors in the data and analytics software segment, with share prices up 5% on average over the last month. DigitalOcean is down 33.9% during the same time and is heading into earnings with an average analyst price target of $173.80 (compared to the current share price of $90.73).
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