DigitalOcean (NYSE:DOCN) Releases Q1 2026 Earnings Guidance

DigitalOcean (NYSE:DOCN) updated its first quarter 2026 earnings guidance on Tuesday. The company provided EPS guidance of 0.220-0.270 for the period, compared to the consensus EPS estimate of 0.390. The company issued revenue guidance of $249.0 million-$250.0 million, compared to the consensus revenue estimate of $248.5 million. DigitalOcean also updated its FY 2026 guidance to 0.750-1.000 EPS.

Wall Street Analysts Forecast Growth

Several brokerages have weighed in on DOCN. Citizens Jmp increased their target price on DigitalOcean from $60.00 to $83.00 and gave the stock a “market outperform” rating in a research report on Wednesday. Bank of America increased their price objective on shares of DigitalOcean from $72.00 to $86.00 and gave the stock a “buy” rating in a report on Wednesday. Stifel Nicolaus set a $57.00 target price on shares of DigitalOcean in a research note on Tuesday. UBS Group upped their target price on shares of DigitalOcean from $48.00 to $68.00 and gave the stock a “neutral” rating in a research report on Wednesday. Finally, Oppenheimer lifted their price target on DigitalOcean from $60.00 to $85.00 and gave the company an “outperform” rating in a report on Wednesday. Nine equities research analysts have rated the stock with a Buy rating and five have given a Hold rating to the company. According to data from MarketBeat.com, the stock currently has a consensus rating of “Moderate Buy” and an average price target of $69.23.

DigitalOcean Trading Down 3.8%

Shares of NYSE DOCN opened at $57.02 on Thursday. The firm has a 50-day moving average of $56.09 and a two-hundred day moving average of $45.23. The company has a market capitalization of $5.22 billion, a price-to-earnings ratio of 22.61, a PEG ratio of 8.81 and a beta of 1.77. DigitalOcean has a twelve month low of $25.45 and a twelve month high of $70.43.

Key Headlines Impacting DigitalOcean

Here are the key news stories impacting DigitalOcean this week:

• Positive Sentiment: Q4 beat and AI traction — DigitalOcean reported Q4 revenue (~$242M) and showed AI-specific ARR of $120M with management raising growth guidance; MarketBeat explains this drove renewed investor interest as the company shifts toward “inference” and sticky platform services. DigitalOcean’s AI Surge
• Positive Sentiment: Broad analyst price-target upgrades — multiple firms raised targets and ratings (Bank of America to $86, Oppenheimer to $85, Goldman to $78, Cantor Fitzgerald/Citizens JMP to ~$83, Barclays to $69, UBS to $68), signaling analyst confidence in the AI-driven revenue acceleration. BOA Price Target Raise Cantor Fitzgerald Raise Barclays Raise Additional Benzinga Coverage
• Positive Sentiment: Hardware diversification — DigitalOcean expanded AMD Instinct MI350X GPU capacity to improve inference performance, cost/perf and reduce NVIDIA dependency, supporting the inference-focused growth playbook. AMD Expansion
• Neutral Sentiment: Planned margin and cash-flow shift — management guided to higher capex to add capacity (FCF margin guidance lowered to ~15–17% and EBITDA margin pressure in 2026) as a deliberate growth investment; this supports revenue but compresses short‑term margins. Earnings Presentation
• Neutral Sentiment: Volatility risk from short interest — MarketBeat notes relatively high short interest (~10.7%), which can amplify moves in either direction as fundamentals or sentiment change. MarketBeat Short Interest Note
• Negative Sentiment: Convertible‑note hedge risks — TipRanks flags complexity in DigitalOcean’s 2030 convertible notes hedging structure that could introduce dilution, pricing and counterparty risks if hedges unwind or are executed, creating a tangible downside risk for shareholders. TipRanks Convertible Notes Risk

Institutional Inflows and Outflows

Several institutional investors have recently made changes to their positions in DOCN. Pacer Advisors Inc. lifted its position in shares of DigitalOcean by 225.7% in the 4th quarter. Pacer Advisors Inc. now owns 16,426 shares of the company’s stock valued at $790,000 after acquiring an additional 11,382 shares in the last quarter. Invesco Ltd. grew its position in DigitalOcean by 12.3% during the 4th quarter. Invesco Ltd. now owns 288,571 shares of the company’s stock worth $13,886,000 after purchasing an additional 31,618 shares in the last quarter. Mercer Global Advisors Inc. ADV acquired a new stake in DigitalOcean during the 4th quarter valued at $400,000. Vident Advisory LLC acquired a new stake in shares of DigitalOcean in the fourth quarter worth $438,000. Finally, Mackenzie Financial Corp purchased a new stake in shares of DigitalOcean in the fourth quarter worth approximately $209,000. 49.77% of the stock is owned by hedge funds and other institutional investors.

DigitalOcean Company Profile

DigitalOcean Holdings, Inc is a cloud infrastructure provider that focuses on simplicity, performance and developer experience. The company offers a range of cloud services designed to help software developers, startups and small- to medium-sized businesses deploy, manage and scale applications. Its flagship offering, Droplets, provides virtual private servers that can be configured with various CPU, memory and storage options. In addition to compute instances, DigitalOcean’s platform includes managed Kubernetes, scalable object and block storage, managed databases, load balancers and networking capabilities such as Virtual Private Cloud (VPC) and Floating IPs.

Founded in 2011 and headquartered in New York City, DigitalOcean was created with the goal of making cloud computing more accessible to individual developers and smaller teams.