Why DigitalOcean Stock Sank Today

Core Viewpoint - DigitalOcean's stock declined despite beating Q3 expectations and raising full-year guidance, primarily due to disappointing Q4 guidance [1][3]. Financial Performance - DigitalOcean reported Q3 revenue of $198 million, exceeding management's expectation of up to$197 million [2]. - The company raised its full-year guidance for both revenue and profit metrics, indicating positive performance [2][3]. Investor Sentiment - Investors reacted negatively to the Q4 guidance, which was perceived as underwhelming compared to the strong Q3 results [3]. - The stock typically rises when a company beats and raises guidance, but in this case, the opposite occurred due to Q4 expectations [3]. Customer Growth - DigitalOcean continues to add customers, with 88% of its revenue coming from customers spending $50 or more monthly [5]. - The addition of customers in this category during Q3 is viewed as a positive long-term trend [5].