Dropbox Surges After Earnings Top Wall Street Estimates

Shares of Dropbox Inc. (DBX)  were spiking after quarterly earnings for the cloud software company beat analysts' expectations and the company showed progress on several fronts. 

The stock popped 5.4% to $26.07 a share on Friday, Nov. 9. 

Dropbox reported an adjusted profit of 11 cents a share; on a GAAP basis the company reported a loss of 1 cent. The adjusted figure was well above Wall Street's profit expectations of 6 cents a share, and above last-year's profit of 7 cents. Revenue in the quarter was $360.3 million, handily beating estimates of $352.8 million.

Dropbox also raised its full-year revenue guidance to a range of $1.38 billion to $1.39 billion. The previous range was $1.36 billion to $1.37 billion. 

Perhaps just as important as the beat-and-raise was the strength Dropbox showed with customers. The company saw an 18% increase in users year-over-year to 12.3 million from 10.4 million. Dropbox also raised the price it charges users per year to $118.60 from $112.05, helping propel gross margins to 75% from 68.1% in the year-ago period. 

Dropbox went public in late March and traded at $28 a share on its first day of trading. After surging to $42 a share in mid-June, it quickly dropped back down to $26 in late July, and has settled near that level. 

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