DigitalOcean Holdings, Inc. projects its revenue growth rate to accelerate to 29% in the second quarter of 2026, up from 14% in the same quarter of 2025, driven by sustained demand for its AI-Native Cloud. The company anticipates its remaining performance obligations (RPO) will exceed $800 million, growing more than 10X from Q2 FY25, with the weighted average life increasing from 1.6 years to over 3 years. Management expects Q2 adjusted EBITDA margin and non-GAAP Net Income per Share to reach or exceed the high end of its guidance, reflecting strong operational leverage and disciplined execution.

Strategic Expansion and Capacity

To support this projected growth, DigitalOcean has signed an additional 20 MW of committed data center capacity for 2027 and 2028. This incremental capacity brings DigitalOcean's total committed data center capacity to approximately 155 MW. The company continues to secure multiple nine-figure annual customer commitments for inference and cloud products. This expansion underscores the company's focus on scaling its infrastructure to meet the rising requirements for inference and agentic workloads.

Market Performance and Index Inclusion

DigitalOcean recently joined the Russell 1000 Index, moving up from the Russell 2000 Index, effective June 29, 2026. This inclusion followed the company's evolution into a $1 billion Annual Run Rate Revenue business. The stock has demonstrated significant upward momentum, trading well above its key moving averages.

Business Outlook

DigitalOcean provides a cloud computing platform designed for developers, start-ups, and small to medium-sized businesses. The company projects a higher exit growth rate for 2026 as demand for its AI-Native Cloud solutions continues to expand across North America, Europe, and Asia. The company will provide more details in its upcoming earnings release.

DigitalOcean has appointed Kevin Van Gundy as Chief Revenue Officer, Leo Leung as Chief Marketing Officer, and Brady Mickelsen as Chief Legal & Administrative Officer to strengthen its executive leadership team. The move comes weeks after the company unveiled its AI-Native Cloud at its Deploy conference, positioning itself to capture a shift in software development toward inference and agentic workloads. The new leaders join Chief Executive Officer Paddy Srinivasan, Chief Financial Officer Matt Steinfort, and Chief Product and Technology Officer Vinay Kumar to execute a strategy focused on the inference and agentic era.

The company reported accelerating momentum in the first quarter of 2026. Revenue reached $257.9 million, an increase of 22% year over year. Annual run-rate revenue (ARR) from AI customers grew 221% year over year to $170 million, while ARR from customers spending more than $1 million increased 179% to $183 million. Notably, 81% of AI customer ARR in Q1 came from inference services and core cloud rather than bare-metal GPU rental.

Financial Performance Overview

Leadership Appointments

Kevin Van Gundy joins as Chief Revenue Officer from Hypermode, where he was Chief Executive Officer. Previously, as Chief Operating Officer at Vercel, he scaled revenue more than 50X and grew the team from fewer than 20 to over 450 people. He also led go-to-market organizations at Domino Data Lab, Tray.ai, and Neo4j. Van Gundy will architect the sales motion for DigitalOcean's AI-native accounts.

Leo Leung assumes the role of Chief Marketing Officer, bringing experience from Google Cloud and Oracle Cloud Infrastructure (OCI). At OCI, he led messaging as the unit grew from inception to a $12 billion run rate. He will focus on defining DigitalOcean's position against hyperscalers and scaling developer mindshare.

Brady Mickelsen becomes Chief Legal & Administrative Officer. He joins from Tanium, where he served as Chief Legal Officer, and previously held senior legal roles at C3.ai, TriNet, and Oracle. Mickelsen will lead legal, people, and real estate functions, providing governance and operational velocity as the company scales.