Financial News

DigitalOcean Announces Second Quarter 2024 Financial Results

Revenue of $192 million, up 13% year-over-year

GAAP Net Income was $19 million and Adjusted EBITDA was $82 million at 42% margin

DigitalOcean Holdings, Inc. (NYSE: DOCN), the developer cloud optimized for startups and growing technology businesses, today announced results for its second quarter ended June 30, 2024.

“We have delivered another strong quarter of business results and exciting product announcements. In Q2 we saw revenue growth continue to re-accelerate at 13%, with AI/ML continuing to accelerate with ARR up over 200% year-over-year, and expanded our leadership team by adding a Chief Product and Technology Officer to accelerate innovation, a Chief Ecosystem and Growth Officer to drive growth and engagement within our developer community and a Chief Revenue Officer to fortify our go-to-market functions,” said Paddy Srinivasan, CEO of DigitalOcean. “With our new leadership team in place and accelerating product innovation, we continue to execute on our mission of providing cloud computing to growing technology companies as well as pursue our AI strategy of democratizing access to GPU Infrastructure and a compelling platform to simplify building and consuming AI.”

Second Quarter 2024 Financial Highlights:

  • Revenue was $192 million, an increase of 13% year-over-year.
  • Annual Run-Rate Revenue (ARR) ended the quarter at $781 million, an increase of 15% year-over-year.
  • Gross profit of $117 million, an increase of 15% year-over-year, and gross profit margin was 61%.
  • Net income attributable to common stockholders was $19 million and net income margin was 10%.
  • Adjusted EBITDA was $82 million, an increase of 13% year-over-year, and adjusted EBITDA margin was 42%.
  • Diluted net income per share was $0.20 and non-GAAP diluted net income per share was $0.48.
  • Net cash from operating activities was $71 million as compared to $64 million in the second quarter 2023.
  • Adjusted free cash flow was $37 million as compared to $45 million in the second quarter 2023.
  • Cash and cash equivalents was $443 million as of June 30, 2024.

Second Quarter 2024 Operational Highlights:

  • On July 9, revived the virtual developer conference, Deploy, where a number of product releases were announced such as VPC Peering Beta and Premium CPU Optimized 96 vCPU Droplets, among others.
  • Announced the EA (Early Availability) of GPU droplets which democratizes on-demand access to NVIDIA H100 instances for customers (including DigitalOcean’s approximately 638 thousand customers) with the ability to leverage 1, 8 or more GPUs providing flexible deployment options tailored to various use cases and budgets.
  • Released 24 new product features throughout the second quarter, doubling our product velocity from the prior 6 months, which include Managed OpenSearch and 5th Generation Xeon Processors, as well as enhanced data processing and transfer capabilities within our data centers.
  • Average Revenue Per Customer (ARPU) was $99.45, an increase of 9% over the second quarter 2023.
  • Builders and Scalers, those customers spending more than $50 per month, increased 7% from the second quarter 2023 and their revenue grew 15% year-over-year.
  • Net Dollar Retention Rate (NDR) remained stable at 97% as compared to the prior quarter.
  • The Company repurchased 297,106 shares during the quarter.

Financial Outlook:

DigitalOcean is initiating guidance for the third quarter ending September 30, 2024 as follows:

  • Total revenue of $196 to $197 million.
  • Adjusted EBITDA margin of 37% to 38%.
  • Non-GAAP diluted net income per share of $0.39 to $0.41.
  • Fully diluted weighted average shares outstanding of approximately 102 to 103 million shares.

DigitalOcean is updating guidance for the full year 2024 as follows:

  • Total revenue of $770 to $775 million.
  • Adjusted EBITDA margin of 37% to 39%.
  • Adjusted free cash flow margin in the range of 15% to 17% of revenue.
  • Non-GAAP diluted net income per share of $1.60 to $1.70.
  • Fully diluted weighted average shares outstanding of approximately 102 to 103 million shares.

A reconciliation of non-GAAP outlook measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, expenses that may be incurred in the future. For example, stock-based compensation expense-related charges are impacted by the timing of employee stock transactions, the future fair market value of our common stock, and our future hiring and retention needs, all of which are difficult to predict and subject to constant change. Accordingly, a reconciliation is not available without unreasonable effort and we are unable to assess the probable significance of the unavailable information, although it is important to note that these factors could be material to our results computed in accordance with GAAP.

Conference Call Information:

DigitalOcean will host a conference call today, August 8, 2024, at 5:00 p.m. ET to review its results. The conference call and presentation can be accessed by registering for the webcast at https://events.q4inc.com/attendee/527008089. A live webcast and replay of the conference call in addition to the presentation can be accessed from the DigitalOcean investor relations website at http://investors.digitalocean.com.

About DigitalOcean

DigitalOcean simplifies cloud computing so businesses can spend more time creating software that changes the world. With its mission-critical infrastructure and fully managed offerings, DigitalOcean helps developers at startups and growing digital businesses rapidly build, deploy and scale, whether creating a digital presence or building digital products. DigitalOcean combines the power of simplicity, security, community and customer support so customers can spend less time managing their infrastructure and more time building innovative applications that drive business growth. For more information, visit digitalocean.com.

Forward‑Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding our performance, including but not limited to statements in the section titled “Financial Outlook.” The forward-looking statements contained in this release and the accompanying earnings call referenced in this release are subject to known and unknown risks, uncertainties, assumptions, and other factors that may cause actual results or outcomes to be materially different from any future results or outcomes expressed or implied by the forward-looking statements. These risks, uncertainties, assumptions, and other factors include, but are not limited to: (1) fluctuations in our financial results make it difficult to project future results; (2) our history of operating losses; (3) our identification of a material weakness in our internal control over financial reporting, which may impact our ability to accurately report our financial statements; (4) our ability to attract and retain customers and/or expand usage of our platform by such customers; (5) our ability to release updates and new features to our platform and adapt and respond effectively to rapidly changing technology or customer needs; (6) breaches in our security measures allowing unauthorized access to our platform, our data, or our customers’ data; (7) the competitive markets in which we participate; (8) general market, political, economic, and business conditions; (9) the operational challenges related to international operations; (10) our ability to successfully integrate acquired businesses, including Paperspace, and achieve expected synergies and benefits; (11) liability we may incur due to the activities of our customers; and (12) our customers’ ability to have continued and unimpeded access to our platform, including as a result of evolving laws and industry standards.

Further information on these and additional risks, uncertainties, assumptions and other factors that could cause actual results or outcomes to differ materially from those included in or contemplated by the forward-looking statements contained in this release are included under the caption “Risk Factors” and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2023, and subsequent filings and reports we make with the SEC.

We operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this release. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur. The forward-looking statements made in this release relate only to events as of the date on which the statements are made. We assume no obligation to, and do not currently intend to, update any such forward-looking statements after the date of this release.

About Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States, or GAAP, we provide investors with non-GAAP financial measures including: (i) adjusted EBITDA and adjusted EBITDA margin; (ii) non-GAAP net income and non-GAAP diluted net income per share; and (iii) adjusted free cash flow and adjusted free cash flow margin. These measures are presented for supplemental informational purposes only, have limitations as analytical tools and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In particular, adjusted free cash flow is not a substitute for cash provided by operating activities. Additionally, the utility of adjusted free cash flow as a measure of our financial performance and liquidity is further limited as it does not represent the total increase or decrease in our cash balance for a given period. Our calculations of each of these measures may differ from the calculations of measures with the same or similar titles by other companies and therefore comparability may be limited. Because of these limitations, when evaluating our performance, you should consider each of these non-GAAP financial measures alongside other financial performance measures, including the most directly comparable financial measure calculated in accordance with GAAP and our other GAAP results. A reconciliation of each of our non-GAAP financial measures to the most directly comparable financial measure calculated in accordance with GAAP is set forth in the tables in the section “Reconciliation of GAAP to Non-GAAP Data.”

Adjusted EBITDA and Adjusted EBITDA Margin

We define adjusted EBITDA as net income (loss) attributable to common stockholders, adjusted to exclude depreciation and amortization, stock-based compensation, interest expense, acquisition related compensation, acquisition and integration related costs, income tax expense, restructuring and other charges, restructuring related charges, impairment of long-lived assets, and other income, net. We define adjusted EBITDA margin as adjusted EBITDA as a percentage of revenue. We believe that adjusted EBITDA, when taken together with our GAAP financial results, provides meaningful supplemental information regarding our operating performance and facilitates internal comparisons of our historical operating performance on a more consistent basis by excluding certain items that may not be indicative of our business, results of operations or outlook. In particular, we believe that the use of adjusted EBITDA is helpful to our investors as it is a measure used by management in assessing the health of our business, evaluating our operating performance, and for internal planning and forecasting purposes.

Our calculation of adjusted EBITDA and adjusted EBITDA margin may differ from the calculations of adjusted EBITDA and adjusted EBITDA margin by other companies and therefore comparability may be limited. Because of these limitations, when evaluating our performance, you should consider adjusted EBITDA and adjusted EBITDA margin alongside other financial performance measures, including our net income (loss) attributable to common stockholders and other GAAP results.

Non-GAAP Net Income and Non-GAAP Diluted Net Income Per Share

We define non-GAAP net income as net income (loss) attributable to common stockholders, excluding stock-based compensation, acquisition related compensation, amortization of acquired intangibles, acquisition and integration related costs, restructuring and other charges, restructuring related charges, impairment of long-lived assets, and other unusual or non-recurring transactions as they occur. We define non-GAAP diluted net income per share as non-GAAP net income divided by the weighted-average diluted shares outstanding, which includes the potentially dilutive effect of our stock options, RSUs, PRSUs, and Convertible Notes.

We believe non-GAAP diluted net income per share provides our management and investors consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations, as this metric generally eliminates the effects of unusual or non-recurring items from period to period for reasons unrelated to overall operating performance.

Adjusted Free Cash Flow and Adjusted Free Cash Flow Margin

Adjusted free cash flow is a non-GAAP financial measure that we define as Net cash provided by operating activities less purchases of property and equipment, capitalized internal-use software costs, and excluding cash paid for restructuring and other charges, acquisition related compensation, restructuring related charges, and acquisition and integration related costs. Adjusted free cash flow margin is calculated as adjusted free cash flow divided by total revenue.

We believe that adjusted free cash flow and adjusted free cash flow margin are useful indicators of liquidity that provide information to management and investors about the amount of cash generated from our core operations that can be used for strategic initiatives, including investing in our business and selectively pursuing acquisitions and strategic investments. We further believe that historical and future trends in adjusted free cash flow and adjusted free cash flow margin, even if negative, provide useful information about the amount of Net cash provided by operating activities that is available (or not available) to be used for strategic initiatives. One limitation of adjusted free cash flow and adjusted free cash flow margin is that they do not reflect our future contractual commitments. Additionally, adjusted free cash flow does not represent the total increase or decrease in our cash balance for a given period.

Key Business Metrics:

We utilize the key metrics set forth below to help us evaluate our business and growth, identify trends, formulate financial projections and make strategic decisions.

Customers

We divide our customer population into the following categories:

  • Testers: users that both (i) spend less than or equal to $50 per month and (ii) utilize our platform for three months or less.
  • Learners: users that both (i) spend less than or equal to $50 for the month-end period and (ii) have been on our platform for more than three months.
  • Builders: users that spend greater than $50 and less than or equal to $500 for the month-end period.
  • Scalers: users that spend greater than $500 for the month-end period.

We view Learners, Builders and Scalers as the most appropriate measure of our customer population, and Testers have therefore been excluded from the total customer population count. While we believe the total number of these customers is an important indicator of the growth of our business and future revenue opportunity, the trends relating to our Builders and Scalers is of particular importance to us as these customers represent a significant majority of our revenue and revenue growth, and they are representative of the SMB customers that grow on our platform and use multiple products.

ARPU

We calculate ARPU on a monthly basis as our total revenue from Learners, Builders and Scalers in that period divided by the total number of Learner, Builder and Scaler customers determined as of the last day of the reported period. For a quarterly or annual period, ARPU is determined as the weighted average monthly ARPU over such three or 12-month period.

ARR

We calculate ARR at a point in time by multiplying the revenue of the last month of the reported period by 12. For our ARR calculations, we include the total revenue from all customers, including Testers, Learners, Builders and Scalers.

Net Dollar Retention Rate

We calculate net dollar retention rate monthly by starting with the revenue from customers, including Testers, Learners, Builders and Scalers, for our IaaS, PaaS and SaaS offerings during the corresponding month 12 months prior, or the Prior Period Revenue. We then calculate the revenue from these same customers as of the current month, or the Current Period Revenue, including any expansion and net of any contraction or attrition from these customers over the last 12 months. The calculation also includes revenue from customers that generated revenue before, but not in, the corresponding month 12 months prior, but subsequently generated revenue in the current month and are therefore reflected in the Current Period Revenue. We include this group of re-engaged customers in this calculation because our customers frequently use our platform for projects that stop and start over time. We then divide the total Current Period Revenue by the total Prior Period Revenue to arrive at the net dollar retention rate for the relevant month. For our net dollar retention rate calculations, we include the total revenue from customers, including Testers, Learners, Builders and Scalers, for our IaaS, PaaS and SaaS offerings. For a quarterly or annual period, the net dollar retention rate is determined as the average monthly net dollar retention rates over such three or 12-month period.

DIGITALOCEAN HOLDINGS, INC.

 

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

(unaudited)

 

 

June 30, 2024

 

December 31, 2023

Current assets:

 

 

 

Cash and cash equivalents

$

443,110

 

 

$

317,236

 

Marketable securities

 

 

 

 

94,532

 

Accounts receivable, less allowance for credit losses of $5,486 and $5,848, respectively

 

67,435

 

 

 

62,186

 

Prepaid expenses and other current assets

 

33,178

 

 

 

29,040

 

Total current assets

 

543,723

 

 

 

502,994

 

 

 

 

 

Property and equipment, net

 

367,428

 

 

 

305,444

 

Restricted cash

 

1,747

 

 

 

1,747

 

Goodwill

 

348,674

 

 

 

348,322

 

Intangible assets, net

 

128,682

 

 

 

140,151

 

Operating lease right-of-use assets, net

 

138,461

 

 

 

155,201

 

Deferred tax assets

 

1,939

 

 

 

1,994

 

Other assets

 

6,139

 

 

 

5,114

 

Total assets

$

1,536,793

 

 

$

1,460,967

 

 

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

9,465

 

 

$

3,957

 

Accrued other expenses

 

55,839

 

 

 

31,046

 

Deferred revenue

 

6,803

 

 

 

5,340

 

Operating lease liabilities, current

 

73,998

 

 

 

81,320

 

Other current liabilities

 

74,051

 

 

 

70,982

 

Total current liabilities

 

220,156

 

 

 

192,645

 

 

 

 

 

Deferred tax liabilities

 

3,510

 

 

 

3,533

 

Long-term debt

 

1,481,577

 

 

 

1,477,798

 

Operating lease liabilities, non-current

 

82,992

 

 

 

91,161

 

Other long-term liabilities

 

2,342

 

 

 

9,528

 

Total liabilities

 

1,790,577

 

 

 

1,774,665

 

 

 

 

 

Preferred stock ($0.000025 par value per share; 10,000,000 shares authorized; 0 shares issued and outstanding as of June 30, 2024 and December 31, 2023)

 

 

 

 

 

Common stock ($0.000025 par value per share; 750,000,000 shares authorized; 91,698,027 and 90,243,442 issued and outstanding as of June 30, 2024 and December 31, 2023, respectively)

 

2

 

 

 

2

 

Additional paid-in capital

 

56,748

 

 

 

30,989

 

Accumulated other comprehensive loss

 

(577

)

 

 

(452

)

Accumulated deficit

 

(309,957

)

 

 

(344,237

)

Total stockholders’ deficit

 

(253,784

)

 

 

(313,698

)

 

 

 

 

Total liabilities and stockholders’ deficit

$

1,536,793

 

 

$

1,460,967

 

DIGITALOCEAN HOLDINGS, INC.

 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(unaudited)

 

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

 

2024

 

2023

 

2024

 

2023

Revenue

$

192,476

 

 

$

169,814

 

 

$

377,206

 

 

$

334,948

 

Cost of revenue

 

75,139

 

 

 

67,354

 

 

 

147,783

 

 

 

139,233

 

Gross profit

 

117,337

 

 

 

102,460

 

 

 

229,423

 

 

 

195,715

 

Operating expenses:

 

 

 

 

 

 

 

Research and development

 

34,040

 

 

 

38,569

 

 

 

68,011

 

 

 

76,841

 

Sales and marketing

 

20,130

 

 

 

16,100

 

 

 

40,934

 

 

 

34,331

 

General and administrative

 

40,839

 

 

 

48,858

 

 

 

86,612

 

 

 

97,797

 

Restructuring and other charges

 

 

 

 

434

 

 

 

 

 

 

21,303

 

Total operating expenses

 

95,009

 

 

 

103,961

 

 

 

195,557

 

 

 

230,272

 

 

 

 

 

 

 

 

 

Income (loss) from operations

 

22,328

 

 

 

(1,501

)

 

 

33,866

 

 

 

(34,557

)

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

Interest expense

 

(2,321

)

 

 

(2,112

)

 

 

(4,625

)

 

 

(4,301

)

Interest income and other income, net

 

4,802

 

 

 

7,594

 

 

 

9,823

 

 

 

14,988

 

Other income, net

 

2,481

 

 

 

5,482

 

 

 

5,198

 

 

 

10,687

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

24,809

 

 

 

3,981

 

 

 

39,064

 

 

 

(23,870

)

Income tax (expense) benefit

 

(5,671

)

 

 

(3,316

)

 

 

(5,787

)

 

 

8,165

 

Net income (loss) attributable to common stockholders

$

19,138

 

 

$

665

 

 

$

33,277

 

 

$

(15,705

)

Net income (loss) per share attributable to common stockholders

Basic

$

0.21

 

 

$

0.01

 

 

$

0.37

 

 

$

(0.17

)

Diluted

$

0.20

 

 

$

0.01

 

 

$

0.35

 

 

$

(0.17

)

Weighted-average shares used to compute net income (loss) per share attributable to common stockholders

Basic

 

91,318

 

 

 

89,007

 

 

 

91,049

 

 

 

92,327

 

Diluted

 

93,832

 

 

 

96,247

 

 

 

94,005

 

 

 

92,327

 

DIGITALOCEAN HOLDINGS, INC.

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

 

 

Six Months Ended June 30,

 

2024

 

2023

Operating activities

 

 

 

Net income (loss) attributable to common stockholders

$

33,277

 

 

$

(15,705

)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

65,016

 

 

 

56,531

 

Stock-based compensation

 

44,710

 

 

 

67,960

 

Provision for expected credit losses

 

7,985

 

 

 

7,551

 

Operating lease right-of-use assets and liabilities, net

 

1,423

 

 

 

6,848

 

Net accretion of discounts and amortization of premiums on investments

 

2,569

 

 

 

(2,689

)

Non-cash interest expense

 

3,988

 

 

 

3,969

 

Loss on impairment of long-lived assets

 

356

 

 

 

553

 

Deferred income taxes

 

 

 

 

1,589

 

Other

 

361

 

 

 

(464

)

Changes in operating assets and liabilities:

 

 

 

Accounts receivable

 

(13,234

)

 

 

(10,795

)

Prepaid expenses and other current assets

 

(4,346

)

 

 

(6,173

)

Accounts payable and accrued expenses

 

(3,655

)

 

 

(14,900

)

Deferred revenue

 

1,462

 

 

 

(565

)

Other assets and liabilities

 

(1,879

)

 

 

6,666

 

Net cash provided by operating activities

 

138,033

 

 

 

100,376

 

 

 

 

 

Investing activities

 

 

 

Capital expenditures - property and equipment

 

(75,534

)

 

 

(46,848

)

Capital expenditures - internal-use software development

 

(4,046

)

 

 

(2,895

)

Cash paid for asset acquisitions

 

 

 

 

(2,500

)

Purchase of marketable securities

 

 

 

 

(318,238

)

Maturities of marketable securities

 

91,675

 

 

 

614,044

 

Purchased interest on marketable securities

 

 

 

 

(151

)

Proceeds from interest on marketable securities

 

 

 

 

61

 

Proceeds from sale of equipment

 

 

 

 

236

 

Net cash provided by investing activities

 

12,095

 

 

 

243,709

 

 

 

 

 

Financing activities

 

 

 

Proceeds related to the issuance of common stock under equity incentive plan

 

7,948

 

 

 

11,669

 

Proceeds from the issuance of common stock under employee stock purchase plan

 

2,231

 

 

 

2,797

 

Principal repayments of finance leases

 

(2,720

)

 

 

 

Employee payroll taxes paid related to net settlement of equity awards

 

(13,469

)

 

 

(10,532

)

Repurchase and retirement of common stock including related costs

 

(18,183

)

 

 

(368,919

)

Net cash used in financing activities

 

(24,193

)

 

 

(364,985

)

 

 

 

 

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

 

(61

)

 

 

(15

)

Increase (decrease) in cash, cash equivalents and restricted cash

 

125,874

 

 

 

(20,915

)

Cash, cash equivalents and restricted cash - beginning of period

 

318,983

 

 

 

151,807

 

Cash, cash equivalents and restricted cash - end of period

$

444,857

 

 

$

130,892

 

DIGITALOCEAN HOLDINGS, INC.

 

RECONCILIATION OF GAAP TO NON-GAAP DATA

(unaudited)

Adjusted EBITDA and Adjusted EBITDA Margin

 

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

(In thousands)

2024

 

2023

 

2024

 

2023

GAAP Net income (loss) attributable to common stockholders

$

19,138

 

 

$

665

 

 

$

33,277

 

 

$

(15,705

)

 

 

 

 

 

 

 

 

Adjustments:

 

 

 

 

 

 

 

Depreciation and amortization

 

33,129

 

 

 

27,618

 

 

 

65,016

 

 

 

56,531

 

Stock-based compensation(1)

 

21,833

 

 

 

36,429

 

 

 

44,563

 

 

 

64,023

 

Interest expense

 

2,321

 

 

 

2,112

 

 

 

4,625

 

 

 

4,301

 

Acquisition related compensation

 

3,716

 

 

 

6,980

 

 

 

8,246

 

 

 

14,581

 

Acquisition and integration related costs

 

(19

)

 

 

1,446

 

 

 

 

 

 

2,747

 

Income tax expense

 

5,671

 

 

 

3,316

 

 

 

5,787

 

 

 

(8,165

)

Restructuring and other charges(1)

 

 

 

 

434

 

 

 

 

 

 

21,303

 

Restructuring related charges(1)(2)

 

243

 

 

 

820

 

 

 

3,863

 

 

 

2,727

 

Impairment of long-lived assets

 

356

 

 

 

 

 

 

356

 

 

 

553

 

Other income, net(3)

 

(4,802

)

 

 

(7,594

)

 

 

(9,823

)

 

 

(14,988

)

Adjusted EBITDA

$

81,586

 

 

$

72,226

 

 

$

155,910

 

 

$

127,908

 

As a percentage of revenue:

 

 

 

 

 

 

 

Net income (loss) margin

 

10

%

 

 

%

 

 

9

%

 

 

(5

)%

Adjusted EBITDA margin

 

42

%

 

 

43

%

 

 

41

%

 

 

38

%

___________________

(1)

For the six months ended June 30, 2024, non-GAAP stock-based compensation excludes $0.1 million as it is presented in Restructuring related charges. For the six months ended June 30, 2023, non-GAAP stock-based compensation excludes $3.9 million, as it is presented in Restructuring and other charges. There were no reclassifications of stock-based compensation for the three months ended June 30, 2024 and 2023.

(2)

For the three and six months ended June 30, 2024, primarily consists of executive reorganization charges. For the three and six months ended June 30, 2023, primarily consists of salary continuation charges.

(3)

For the three and six months ended June 30, 2024 and 2023, primarily consists of interest and accretion income from our cash and cash equivalents and marketable securities.

Non-GAAP Net Income and Non-GAAP Diluted Net Income Per Share

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

(In thousands)

2024

 

2023

 

2024

 

2023

GAAP Net income (loss) attributable to common stockholders

$

19,138

 

 

$

665

 

 

$

33,277

 

 

$

(15,705

)

Stock-based compensation(1)

 

21,833

 

 

 

36,429

 

 

 

44,563

 

 

 

64,023

 

Acquisition related compensation

 

3,716

 

 

 

6,980

 

 

 

8,246

 

 

 

14,581

 

Amortization of acquired intangible assets

 

5,735

 

 

 

3,790

 

 

 

11,470

 

 

 

7,580

 

Acquisition and integration related costs

 

(19

)

 

 

1,446

 

 

 

 

 

 

2,747

 

Restructuring and other charges(1)

 

 

 

 

434

 

 

 

 

 

 

21,303

 

Restructuring related charges(1)(2)

 

243

 

 

 

820

 

 

 

3,863

 

 

 

2,727

 

Impairment of long-lived assets

 

356

 

 

 

 

 

 

356

 

 

 

553

 

Non-GAAP income tax adjustment(3)

 

(3,397

)

 

 

(5,844

)

 

 

(11,423

)

 

 

(23,404

)

Non-GAAP Net income

$

47,605

 

 

$

44,720

 

 

$

90,352

 

 

$

74,405

 

 

 

 

 

 

 

 

 

Non-cash charges related to convertible notes(4)

$

1,588

 

 

$

1,561

 

 

$

3,174

 

 

$

3,121

 

Non-GAAP Net income used to compute net income per share, diluted

$

49,193

 

 

$

46,281

 

 

$

93,526

 

 

$

77,526

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

March 31,

(In thousands, except per share amounts)

2024

 

2023

 

2024

 

2023

GAAP Net income (loss) per share attributable to common stockholders, diluted

$

0.20

 

 

$

0.01

 

 

$

0.35

 

 

$

(0.17

)

Stock-based compensation(1)

 

0.21

 

 

 

0.35

 

 

 

0.44

 

 

 

0.60

 

Acquisition related compensation

 

0.04

 

 

 

0.07

 

 

 

0.08

 

 

 

0.14

 

Amortization of acquired intangible assets

 

0.06

 

 

 

0.04

 

 

 

0.11

 

 

 

0.07

 

Acquisition and integration related costs

 

 

 

 

0.01

 

 

 

 

 

 

0.03

 

Restructuring and other charges(1)

 

 

 

 

 

 

 

 

 

 

0.20

 

Restructuring related charges(1)(2)

 

 

 

 

0.01

 

 

 

0.04

 

 

 

0.03

 

Impairment of long-lived assets

 

 

 

 

 

 

 

 

 

 

0.01

 

Non-cash charges related to convertible notes(4)

 

0.02

 

 

 

0.01

 

 

 

0.03

 

 

 

0.03

 

Non-GAAP income tax adjustment(3)

 

(0.03

)

 

 

(0.06

)

 

 

(0.11

)

 

 

(0.22

)

Non-GAAP Net income per share, diluted*

$

0.48

 

 

$

0.44

 

 

$

0.91

 

 

$

0.72

 

 

 

 

 

 

 

 

 

GAAP Weighted-average shares used to compute net income (loss) per share, diluted

 

93,832

 

 

 

96,247

 

 

 

94,005

 

 

 

92,327

 

Weighted-average dilutive effect of potentially dilutive securities

 

8,403

 

 

 

8,403

 

 

 

8,403

 

 

 

15,583

 

Non-GAAP Weighted-average shares used to compute net income per share, diluted

 

102,235

 

 

 

104,650

 

 

 

102,408

 

 

 

107,910

 

 

*May not foot due to rounding

___________________

(1)

For the six months ended June 30, 2024, non-GAAP stock-based compensation excludes $0.1 million as it is presented in Restructuring related charges. For the six months ended June 30, 2023, non-GAAP stock-based compensation excludes $3.9 million, as it is presented in Restructuring and other charges. There were no reclassifications of stock-based compensation for the three months ended June 30, 2024 and 2023.

(2)

For the three and six months ended June 30, 2024, primarily consists of executive reorganization charges. For the three and six months ended June 30, 2023, primarily consists of salary continuation charges.

(3)

For the periods in fiscal year 2024, we used a tax rate of 16%, which we believe is a reasonable estimate of our long-term effective tax rate applicable to non-GAAP pre-tax income for 2024. For the periods in fiscal year 2023, we used a tax rate of 17%, which we believe was a reasonable estimate of our long-term effective tax rate applicable to non-GAAP pre-tax income for 2023.

(4)

Consists of non-cash interest expense for amortization of deferred financing fees related to the Convertible Notes.

Adjusted Free Cash Flow and Adjusted Free Cash Flow Margin

 

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

(In thousands)

2024

 

2023

 

2024

 

2023

GAAP Net cash provided by operating activities

$

71,340

 

 

$

64,161

 

 

$

138,033

 

 

$

100,376

 

Adjustments:

 

 

 

 

 

 

 

Capital expenditures - property and equipment

 

(31,869

)

 

 

(23,534

)

 

 

(75,534

)

 

 

(46,848

)

Capital expenditures - internal-use software development

 

(2,483

)

 

 

(1,101

)

 

 

(4,046

)

 

 

(2,895

)

Restructuring and other charges

 

 

 

 

4,665

 

 

 

61

 

 

 

15,926

 

Restructuring related charges(1)

 

437

 

 

 

820

 

 

 

4,630

 

 

 

2,727

 

Acquisition related compensation

 

 

 

 

 

 

 

8,326

 

 

 

 

Acquisition and integration related costs

 

4

 

 

 

93

 

 

 

302

 

 

 

1,561

 

Adjusted free cash flow

$

37,429

 

 

$

45,104

 

 

$

71,772

 

 

$

70,847

 

As a percentage of revenue:

 

 

 

 

 

 

 

GAAP Net cash provided by operating activities

 

37

%

 

 

38

%

 

 

37

%

 

 

30

%

Adjusted free cash flow margin

 

19

%

 

 

27

%

 

 

19

%

 

 

21

%

___________________

(1)

For the three and six months ended June 30, 2024, primarily consists of executive reorganization charges. For the three and six months ended June 30, 2023, primarily consists of salary continuation charges.

 

Contacts

Data & News supplied by www.cloudquote.io
Stock quotes supplied by Barchart
Quotes delayed at least 20 minutes.
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.

Use the myMotherLode.com Keyword Search to go straight to a specific page

Popular Pages

  • Local News
  • US News
  • Weather
  • State News
  • Events
  • Traffic
  • Sports
  • Dining Guide
  • Real Estate
  • Classifieds
  • Financial News
  • Fire Info
Feedback