Revenue grew from $192.5M to $321.2M over the ten-quarter window, but gross margin fell from 61.4% to 50.1% and the 2026Q3 net margin of -13.3% contrasts with a 69.0% net margin in 2025Q3 that was likely distorted by non-operating items.
DigitalOcean Holdings, Inc. (DOCN) annual income statement — 8-year revenue, gross profit & net income history
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 |
|---|
| Sales/Revenue | 1.1B | 901.43M | 780.62M | 692.88M | 576.32M | 428.56M | 318.38M | 254.82M | 203.14M |
| Revenue Growth % | 27.63% | 15.48% | 12.66% | 20.23% | 34.48% | 34.61% | 24.94% | 25.44% | - |
| Cost of Goods Sold | 499.96M | 361.83M | 314.67M | 283.97M | 211.93M | 170.59M | 145.53M | 122.26M | 97.04M |
| COGS % of Revenue | - | 40.14% | 40.31% | 40.98% | 36.77% | 39.81% | 45.71% | 47.98% | 47.77% |
| Gross Profit | 602.71M | 539.59M | 465.94M | 408.92M | 364.39M | 257.97M | 172.85M | 132.56M | 106.09M |
| Gross Margin % | 54.66% | 59.86% | 59.69% | 59.02% | 63.23% | 60.19% | 54.29% | 52.02% | 52.23% |
| Gross Profit Growth % | - | 15.81% | 13.95% | 12.22% | 41.26% | 49.24% | 30.39% | 24.95% | - |
| Operating Expenses | 464.95M | 382.6M | 374.94M | 397.02M | 390.09M | 269.15M | 188.64M | 162.47M | 133.39M |
| OpEx % of Revenue | - | 42.44% | 48.03% | 57.3% | 67.69% | 62.8% | 59.25% | 63.76% | 65.66% |
| Selling, General & Admin | 255.55M | 220.98M | 232.44M | 235.77M | 246.21M | 153.47M | 113.67M | 102.5M | 88.45M |
| SG&A % of Revenue | - | 24.51% | 29.78% | 34.03% | 42.72% | 35.81% | 35.7% | 40.22% | 43.54% |
| Research & Development | 209.4M | 161.62M | 142.5M | 140.37M | 143.88M | 115.68M | 74.97M | 59.97M | 44.93M |
| R&D % of Revenue | - | 17.93% | 18.25% | 20.26% | 24.97% | 26.99% | 23.55% | 23.54% | 22.12% |
| Other Operating Expenses | 0 | 0 | 0 | 20.89M | 0 | 0 | 0 | 0 | -622K |
| Operating Income | 137.76M | 156.99M | 91.01M | 11.9M | -25.7M | -11.19M | -15.79M | -29.91M | -27.29M |
| Operating Margin % | 12.49% | 17.42% | 11.66% | 1.72% | -4.46% | -2.61% | -4.96% | -11.74% | -13.44% |
| Operating Income Growth % | - | 72.5% | 665.02% | 146.29% | -129.72% | 29.16% | 47.2% | -9.57% | - |
| EBITDA | 349.95M | 294.44M | 221.06M | 129.76M | 76.53M | 77.19M | 59.78M | 33.18M | 25.12M |
| EBITDA Margin % | 31.74% | 32.66% | 28.32% | 18.73% | 13.28% | 18.01% | 18.78% | 13.02% | 12.37% |
| EBITDA Growth % | 26.34% | 33.19% | 70.36% | 69.55% | -0.84% | 29.11% | 80.2% | 32.06% | - |
| D&A (Non-Cash Add-back) | 212.19M | 137.45M | 130.05M | 117.87M | 102.23M | 88.37M | 75.57M | 63.08M | 52.41M |
| EBIT | 87.02M | 224.6M | 106.81M | 35.72M | -15.49M | -14.46M | -29.05M | -30.24M | -28.47M |
| Net Interest Income | -8.75M | -17.94M | 6.69M | 14.88M | 2.22M | -3.58M | -13.61M | -9.36M | -6.31M |
| Interest Income | 30.53M | 0 | 15.8M | 23.82M | 10.62M | 164K | 0 | 0 | 0 |
| Interest Expense | 39.28M | 17.94M | 9.11M | 8.95M | 8.4M | 3.74M | 13.61M | 9.36M | 6.31M |
| Other Income/Expense | -90.03M | 49.67M | 6.69M | 14.88M | 1.81M | -7.01M | -26.87M | -9.69M | -7.48M |
| Pretax Income | 47.73M | 206.66M | 97.7M | 26.78M | -23.89M | -18.2M | -42.66M | -39.6M | -34.78M |
| Pretax Margin % | 4.33% | 22.93% | 12.52% | 3.86% | -4.14% | -4.25% | -13.4% | -15.54% | -17.12% |
| Income Tax | 13.47M | -52.6M | 13.21M | 7.37M | 3.92M | 1.3M | 911K | 793K | 1.22M |
| Effective Tax Rate % | 28.23% | -25.45% | 13.52% | 27.51% | -16.41% | -7.15% | -2.14% | -2% | -3.51% |
| Net Income | 34.26M | 259.26M | 84.49M | 19.41M | -27.8M | -19.5M | -43.57M | -40.39M | -36M |
| Net Margin % | 3.11% | 28.76% | 10.82% | 2.8% | -4.82% | -4.55% | -13.68% | -15.85% | -17.72% |
| Net Income Growth % | -86.4% | 206.85% | 335.32% | 169.81% | -42.56% | 55.24% | -7.87% | -12.2% | - |
| Net Income (Continuing) | 34.26M | 259.26M | 84.49M | 19.41M | -27.8M | -19.5M | -43.57M | -40.39M | -36M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 0.30 | 2.52 | 0.89 | 0.20 | -0.24 | -0.18 | -0.41 | -0.38 | -0.41 |
| EPS Growth % | -86.99% | 183.15% | 345% | 183.33% | -33.33% | 56.1% | -7.89% | 7.32% | - |
| EPS (Basic) | - | 2.83 | 0.92 | 0.22 | -0.24 | -0.18 | -0.41 | -0.38 | -0.41 |
| Diluted Shares Outstanding | 114.68M | 105.34M | 94.5M | 96.42M | 100.81M | 107.21M | 105.3M | 105.3M | 87.13M |
| Basic Shares Outstanding | 114.68M | 91.48M | 91.63M | 90.14M | 100.81M | 107.21M | 105.3M | 105.3M | 87.13M |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - | - |
Quick answers to the most common questions about buying DOCN stock.
For fiscal year 2025, DigitalOcean Holdings, Inc. (DOCN) reported total revenue of $901.4M. This represents a 343.8% increase compared to $203.1M in 2018.
DigitalOcean Holdings, Inc. (DOCN) is profitable, generating $259.3M in net income for the fiscal year ending 2025 with a net profit margin of 28.8%.
DigitalOcean Holdings, Inc. (DOCN) reported an operating income of $157.0M, resulting in an operating profit margin of 17.4%. This margin reflects the operational efficiency of the business before interest and taxes.
DigitalOcean Holdings, Inc. (DOCN) generated $539.6M in gross profit for the year, representing a gross profit margin of 59.9%. This demonstrates the company's core pricing power and production efficiency.
Key Metrics
Top Statement Risk
Customer concentration in AI workloads
Metrics are mathematically derived from official filings.
Revenue Reaccelerating on AI Demand Shift
Based on the reported quarterly figures, DOCN revenue grew from $192.5M in 2024Q2 to $321.2M in 2026Q3, with year-over-year growth reaccelerating to roughly 29% in the most recent reported quarter after a multi-quarter decline in growth rate.
The reported growth rates moved from the low-teens through 2025 to 28-40% in the latest two quarters, which suggests a shift in demand mix rather than a uniform lift across the customer base. Management commentary referencing large annual commitments from AI-native customers indicates that a meaningful share of this acceleration may be concentrated and therefore less durable than broad-based SMB growth. Investors should monitor whether consumption from these cohorts holds through subsequent quarters.
Gross Margin Compression Under Infrastructure Mix
As reported in the income statement, gross margin peaked near 61.4% in 2025Q1 and has compressed to 50.1% in 2026Q3, a decline of roughly 11 points that coincides with the company's growing exposure to GPU-intensive workloads.
The gross margin trajectory appears more consistent with a shift toward higher-capex, lower-margin compute than with pricing pressure in the core Droplet business alone. This implies the AI build-out may structurally reset gross margins lower than the historical 57-61% range. Whether this represents a durable mix change or temporary depreciation timing cannot be determined from the supplied data.
Headline Net Income Distorted by Non-Operating Items
Based on DOCN's reported figures, the 2025Q3 net income of $158.4M against a 19.6% operating margin implies a net margin of 69.0%, a gap that strongly suggests non-operating items such as tax benefits or valuation allowance releases rather than operating outperformance.
Net income in 2025Q3 is more than three times operating income, which is inconsistent with normal operating-to-net conversion and points to a one-time item. Subsequent quarters reverting to net margins near or below operating margins reinforce this view. Headline EPS figures should therefore be normalized before being used as a basis for valuation.
Stock Compensation Remains a Material Expense
Reported stock-based compensation of $19.4M to $55.2M per quarter, against quarterly operating income ranging from $24.6M to $44.9M, suggests SBC absorbs a large share of operating profit and warrants adjustment when assessing true operating earnings power.
SBC in several quarters approaches or exceeds reported operating income, which implies that GAAP profitability is heavily dependent on equity compensation accounting. The 2026Q2 spike to $55.2M appears to coincide with the acquisition-related and AI-talent build-out, though the data alone cannot confirm the cause. Analysts should treat SBC as a real economic cost when evaluating operating leverage.
Net Loss Exposes Fragility of Growth Narrative
The 2026Q3 reported net loss of $42.6M, with EPS of -$0.37 against a 10.3% operating margin, indicates that the most recent quarter's profitability may be more fragile than the revenue acceleration headline suggests.
The swing from positive EPS in the prior quarter to a net loss while revenue grew strongly raises questions about the cost of the AI expansion and its near-term earnings drag. Short-seller analysis would likely focus on compressing gross margins and rising SBC as evidence that top-line growth is being purchased at the expense of profitability. Investors should monitor whether operating margin recovers toward the mid-to-high teens as the new infrastructure matures.