DigitalOcean Jumps 50% After $258 Million Q1, Lifts 2027 Growth Outlook Above 50%
Updated
Updated · The Motley Fool · May 11
DigitalOcean Jumps 50% After $258 Million Q1, Lifts 2027 Growth Outlook Above 50%
13 articles · Updated · The Motley Fool · May 11
DigitalOcean shares have climbed more than 50% since its May 5 earnings report, after the cloud company posted first-quarter revenue of $258 million, up 22%.
AI demand drove the surge: management said sales to AI customers were exceptionally strong, and CEO Paddy Srinivasan called the new AI-Native Cloud the company’s most significant product launch.
The company raised its growth outlook after securing 60 megawatts of additional compute capacity, saying revenue should grow 26% in 2026 and then accelerate to more than 50% in 2027.
Profitability softened as DigitalOcean spent heavily on AI infrastructure—non-GAAP net income fell 21% to $0.44 a share—even as management said it beat every target from the prior quarter.
The rally has pushed the stock up about 240% in 2026, while Wall Street’s median target of $177 implies only about 8% further upside from roughly $164.
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