- DigitalOcean announced the company’s financial results for the second quarter. At the end of the quarter, the company met its expectations.
- DigitalOcean also announced that Chief Financial Officer Bill Sorenson will be retired from the company in the August of 2023.
- The company stated that they are increasing its operating income and free cash flow outlook for the entire fiscal year.
The cloud for developers, startups, and SMBs, DigitalOcean announced the financial results for the second quarter ended June 30. The company stated that it managed to meet Q2 targets despite the current situation in the macroeconomic environment. The company also increased its outlook for operating income and free cash flow for the fiscal year.
CFO transition
The company announced that its Chief Financial Officer Bill Sorenson will be retired from the company next year. Mr. Sorenson will continue serving while the company is searching for his successor. Then he will serve as an advisor for a smoother transition and onboarding of a new CFO. He will be in the company until August of 2023. Second Quarter 2022 Financial Highlights:
- Revenue was $133.9 million, an increase of 29% year-over-year.
- Annual Run-Rate Revenue (ARR) ended the quarter at $544.1 million, representing 28% year-over-year growth.
- Gross profit of $86.6 million or 65% of revenue, an increase of 700 basis points year-over-year, and adjusted gross profit of $109.7 million or 82% of revenue.
- Loss from operations was $7.4 million and the operating margin was (6)%.
- Non-GAAP income from operations was $22.3 million and the non-GAAP operating margin was 17%.
- Net loss per share was $(0.06) and non-GAAP diluted net income per share was $0.20.
- Cash, cash equivalents, and marketable securities were $1.2 billion as of June 30, 2022.
For the third quarter of 2022 the company expects:
- Total revenue of $145.5 to $147 million.
- Non-GAAP operating margin of 17% to 18%.
- Non-GAAP diluted net income per share of $0.22 to $0.23.
- Fully diluted weighted average shares outstanding of approximately 113 to 115 million shares.
For the full year 2022, the company expects:
- Total revenue of $564 to $568 million.
- Non-GAAP operating margin of 15% to 16%.
- Free cash flow in the range of 9% to 10% of revenue.
- Non-GAAP diluted net income per share from $0.74 to $0.75.
- Fully diluted weighted average shares outstanding of approximately 117 to 119 million shares.
Yancey Spruill, CEO of DigitalOcean said,
« We are taking a number of actions in the second half to deliver 30% growth with improving profitability and cash flow despite an uncertain environment driven by macroeconomic factors beyond our control.
Bill has been an incredible partner, leader, and team builder. His financial acumen and experience have been critical over the past three years as we have turned the company around while dealing with a global pandemic, improved our financial profile through raising over $2.5 billion in capital and positioned the company to scale and achieve our first billion of revenue in 2024. »