DigitalOcean Holdings, Inc. (NYSE:DOCN) Q3 2023 Earnings Conference Call November 2, 2023 4:30 PM ET Company Participants Rob Bradley - Vice President of Investor Relations Yancey Spruill - Chief Executive Officer Matt Steinfort - Chief Financial Officer Conference Call Participants Raimo Lenschow - Barclays Josh Baer - Morgan Stanley Patrick Walravens - JMP Kingsley Crane - Canaccord Genuity Jason Ader - William Blair Jaiden Patel - JPMorgan Operator Hello and good afternoon. My name is Jeremy and I'll be ...

Community Enabling faster, lower cost innovation without locking users into a proprietary stack Developer & SMB Cloud 2018-2023+ VPS Hosting 2012-2015 Cloud Infrastructure 2015-2018 Essential elements to help developers and growing SMBs scale such as Managed Kubernetes, Managed Databases, Marketplace, App Platform, Functions, Managed Hosting and AI/ML Customers in 190 Countries Asia 24% of revenue Amsterdam Frankfurt London Toronto Bangalore Singapore New York San Francisco Europe 29% of revenue RoW 10% of ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission File Number: 001-40252 DigitalOcean Holdings, Inc. (Exact Name of Registrant as Specified in Its Charter) (State or other juri ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission File Number: 001-40252 DigitalOcean Holdings, Inc. (Exact Name of Registrant as Specified in Its Charter) (State or other jurisdict ...

DigitalOcean Holdings, Inc. (NYSE:DOCN) Q2 2023 Earnings Conference Call August 3, 202316:30 ET Company Participants Rob Bradley - Vice President of Investor Relations Yancey Spruill - Chief Executive Officer Matt Steinfort - Chief Financial Officer Conference Call Participants Raimo Lenschow - Barclays Patrick Walravens - JMP Securities Mike Cikos - Needham Pinjalim Bora - JP Morgan Quinton Gabrielli - Piper Sandler Timothy Horan - Oppenheimer Operator Hello and thank you for standing by. My name is Regina ...

DigitalOcean Holdings, Inc. (NYSE:DOCN) Q1 2023 Earnings Conference Call May 9, 2023 8:00 AM ET Company Participants Rob Bradley - Vice President, Investor Relations Yancey Spruill - Chief Executive Officer Matt Steinfort - Chief Financial Officer Conference Call Participants Wamsi Mohan - Bank of America Michael Turits - KeyBanc Raimo Lenschow - Barclays Mike Cikos - Needham Brad Reback - Stifel Pinjalim Bora - JP Morgan Gabriela Borges - Goldman Sachs Quinton Gabrielli - Piper Sandler Operator Thank you f ...

Customer Metrics - As of March 31, 2023, DigitalOcean had approximately 614,000 active customers categorized as Learners, Builders, and Scalers, with revenue from Testers representing less than $1 million in a single month[123][124] - The average revenue per customer (ARPU) increased from $76.45 in Q1 2022 to $88.35 in Q1 2023, indicating a strong growth in customer spending[130] - Annual run-rate revenue (ARR) reached $669 million as of March 31, 2023, up from $524 million in the same period of 2022, reflecting a significant year-over-year growth[130] - The number of Scalers increased from approximately 11,000 in Q1 2022 to about 15,000 in Q1 2023, while Builders grew from approximately 91,000 to 131,000 in the same timeframe[131] - Revenue from Builders and Scalers increased by 42% and 27%, respectively, for the three months ended March 31, 2023, compared to the same period in 2022[131] - For the three months ended March 31, 2023, 38% of revenue was generated from North America, 29% from Europe, 23% from Asia, and 10% from the rest of the world, highlighting a diverse customer base[129] Financial Performance - Revenue for the three months ended March 31, 2023, was $165.1 million, a 30% increase from $127.3 million in the same period of 2022, driven by the Cloudways acquisition and a 16% increase in ARPU to $88.35[160] - The net dollar retention rate was 107% for the three months ended March 31, 2023, down from 117% in the same period of 2022, indicating a slight decrease in revenue growth from existing customers[141] - GAAP net loss attributable to common stockholders for Q1 2023 was $34,937,000, compared to a loss of $18,568,000 in Q1 2022[186] - Adjusted EBITDA for Q1 2023 was $56,204,000, representing an adjusted EBITDA margin of 34%, up from 29% in Q1 2022[186] - Non-GAAP net income for Q1 2023 was $28,714,000, compared to $9,453,000 in Q1 2022, with non-GAAP diluted net income per share increasing to $0.28 from $0.09[190] - Adjusted free cash flow for Q1 2023 was $25,743,000, with an adjusted free cash flow margin of 16%, significantly up from 4% in Q1 2022[195] - GAAP net cash provided by operating activities for Q1 2023 was $36,215,000, compared to $30,401,000 in Q1 2022, reflecting a margin of 22%[195] Expenses and Costs - Cost of revenue increased by $24.7 million, or 52%, to $71.9 million for the three months ended March 31, 2023, primarily due to operating and variable lease costs related to new co-location facilities[161] - Gross profit margin decreased to 56% for the three months ended March 31, 2023, down from 63% in the same period of 2022, attributed to higher colocation and depreciation costs[161] - Total operating expenses rose by $32.1 million, or 34%, to $125.8 million for the three months ended March 31, 2023, with significant increases in general and administrative expenses[162] - Research and development expenses increased by $1.0 million, or 3%, to $38.3 million, primarily due to higher software license and professional services costs[162] - General and administrative expenses surged by $11.5 million, or 31%, to $48.9 million, driven by acquisition-related compensation and stock-based compensation[164] - Stock-based compensation expenses increased to $27,594,000 in Q1 2023 from $25,981,000 in Q1 2022[186] - Acquisition-related compensation for Q1 2023 was $7,601,000, with additional costs related to acquisitions and integrations amounting to $1,301,000[186] - Restructuring and other charges amounted to $20.9 million, a 100% increase, primarily due to one-time severance and benefit payments[165] - Restructuring and other charges totaled $20,869,000 in Q1 2023, indicating ongoing strategic adjustments[186] Cash and Investments - As of March 31, 2023, the company had $20.9 million in cash and cash equivalents and $591.7 million in marketable securities[170] - Net cash provided by operating activities was $36.2 million for the three months ended March 31, 2023, compared to $30.4 million in the same period of 2022, reflecting higher revenues and interest income[175] - The company initiated a common stock buyback program in February 2023, repurchasing 7,759,973 shares for $265.9 million during the first quarter[169] Strategic Initiatives - DigitalOcean's restructuring plan aims to achieve over 20% adjusted free cash flow margins by the end of Q3 2023, involving position eliminations and geographical adjustments[134] - The company is focused on enhancing its platform and product offerings, with plans for strategic partnerships and acquisitions to drive customer acquisition and usage[138] - DigitalOcean's self-service customer acquisition model has historically generated nearly all revenue, with sales and marketing expenses constituting approximately 11% of revenue for the three months ended March 31, 2023[128] Market Risk - There were no material changes in market risk from the previous fiscal year, maintaining stability in financial operations[196]

Revenue Growth - Revenue from higher spend customers represented 85% of total revenue in 2022, up from 83% in 2021 and 79% in 2020[34] - Average revenue per customer (ARPU) increased significantly from $47.78 in 2020 to $75.19 in 2022[34] - Net dollar retention (NDR) rose from 103% in 2020 to 115% in 2022, indicating strong revenue growth from existing customers[39] - The number of higher spend customers increased to approximately 144,000 in 2022, up from 100,000 in 2021[39] - Approximately two-thirds of the company's revenue in 2022 came from customers located outside the United States[59] Customer Engagement and Community - DigitalOcean's community ecosystem attracted over 8 million monthly unique visitors, enhancing customer engagement and content generation[37] - The company emphasizes community engagement, with over 7,500 technical tutorials available to support developers in creating modern applications[69] Product and Service Expansion - The company launched its Australia data center in November 2022 and plans to expand into additional new locations[42] - DigitalOcean acquired Cloudways in Q3 2022, adding a managed hosting offering and a significant number of higher spend customers[44] - The company introduced performance upgrades to its storage offerings in 2022, aiming to enhance functionality and increase usage[48] - The company launched a new Dedicated CPU Managed MongoDB in 2022, improving performance and enabling easier database migration[49] - The company operates the DigitalOcean Marketplace, which features over 250 preconfigured one-click applications, streamlining the deployment process for developers[52] Innovation and Investment - The company continues to invest in innovative products and features, particularly in IaaS, PaaS, and SaaS markets, to meet the evolving needs of its customers[40] - The company launched the DigitalOcean Partner Pod program to enhance partnership opportunities and drive revenue growth[55] Financial Position - As of December 31, 2022, the company had cash, cash equivalents, and marketable securities totaling $864 million[372] - The company issued Convertible Notes with an aggregate principal amount of $1.5 billion in November 2021[373] - A hypothetical 10% increase in interest rates would have decreased the fair value of available-for-sale securities by approximately $23 million[372] Employee and Diversity Initiatives - The company has a total of 1,204 employees, with 524 located outside the United States[77] - In 2022, the company allocated over $1.1 million in cash and $150,000 in infrastructure credits to more than 900 organizations[90] - The company has published its second annual diversity, equity, inclusion, and belonging report, highlighting progress in workforce diversity[86] - The company maintains a global compensation program aimed at promoting a pay-for-performance culture[80] Security and Compliance - The company has implemented a comprehensive information security program, achieving AICPA SOC 2 Type II certification and Cloud Security Alliance (CSA) STAR Level 1[63] Intellectual Property - The company has filed applications for registration for one additional trademark in the United States and two additional trademarks in various non-U.S. jurisdictions[94] - The company has four issued patents scheduled to expire in 2039 and 2040, with pending applications that could expire in 2039 and 2042[94] Risk Management - The company has not entered into any hedging arrangements regarding foreign currency risk, although it may consider doing so in the future[375]

DigitalOcean Holdings, Inc. (NYSE:DOCN) Q4 2022 Earnings Conference Call February 16, 2023 8:00 AM ET Company Participants Rob Bradley - Vice President, Investor Relations Yancey Spruill - Chief Executive Officer Matt Steinfort - Chief Financial Officer Conference Call Participants Jim Breen - William Blair Gabriela Borges - Goldman Sachs Tim Horan - Oppenheimer Jim Fish - Piper Sandler Eric Heath - KeyBanc Capital Markets Wamsi Mohan - Bank of America Vinod Srinivasaraghavan - Barclays Operator Good mornin ...

DigitalOcean Holdings, Inc. (NYSE:DOCN) Q3 2022 Earnings Conference Call November 7, 2022 4:30 PM ET Company Participants Rob Bradley - Vice President, Investor Relations Yancey Spruill - Chief Executive Officer Bill Sorenson - Chief Financial Officer Conference Call Participants Raimo Lenschow - Barclays Gabriela Borges - Goldman Sachs Pinjalim Bora - JPMorgan James Breen - William Blair Tim Horan - Op. Co. Pat Walravens - JMP Securities James Fish - Piper Sandler Wamsi Mohan - Bank of America Operator Goo ...