Is Dropbox Back After Q4 Earnings Report?
Dropbox stock soared after it reported better than expected quarterly results and increased guidance after Thursday’s closing bell.
When Dropbox Inc. (NASDAQ: DBX | DBX Price Prediction) reported its most recent quarterly results after Thursday’s closing bell, the file hosting service provider posted $0.16 in earnings per share (EPS) and $446.0 million in revenue. Analysts were looking for $0.14 in EPS and revenue of $443.41 million. The fourth quarter of last year reportedly had EPS of $0.10 and $375.9 million in revenue.
During the latest quarter, total revenue increased 19% year over year, or 20% on a constant currency basis. Annual recurring revenue ended at $1.820 billion, an increase of 19% year over year.
Additionally, the number of paying users ended the quarter at 14.3 million, as compared to 12.7 million at the end of the prior year. Average revenue per paying user was $125.00, as compared to $119.61 for the same period last year.
Looking ahead, Dropbox increased its forecasts for its operating margin and free cash flow in 2020 and beyond. The company now expects operating margin to be in the range of 28% to 30%, which it expects to achieve by 2024. Note that this is up from its initial estimate of 20% to 22% only five months ago.
Consensus estimates call for $0.59 in EPS and $1.9 billion in revenue for the 2020 full year.
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Drew Houston, Dropbox co-founder and CEO, commented:
Our strong Q4 marked the end of an exciting year for Dropbox as we launched our vision for the smart workspace. We closed the year with more than $1.6 billion in revenue, over 450,000 Dropbox business teams, and millions of people using our new foreground app that keeps Dropbox at the center of our users’ workflows. Moving into 2020, I’m confident in the team we have on board and the opportunity ahead.
Dropbox stock traded up about 20% on Friday, at $22.52 in a 52-week range of $16.08 to $26.20. The consensus price target is $28.50.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
