Drew Houston, Dropbox co-founder and CEO, speaking at CNBC's @ Work Conference in San Francisco November 4, 2019.
Arun Nevader | CNBC
Dropbox shares jumped after the company reported better-than-expected third-quarter earnings on Thursday, as investors digested the company's improvements on some key metrics, but extended GAAP losses from a year ago.
Here are the key figures:
- Revenue: Excluding certain items, 1
- Revenue: $ 428.2 million, versus $ 423.5 million as expected by analysts, according to Refinitive.
Dropbox's revenue increased 19% year-on-year in the quarter, according to a statement, faster than 18% growth in the previous quarter.
The company had approximately 14 million paying users in the third quarter, above the FactSet consensus estimate of 13.89 million. Average revenue per paying user came in at $ 123.15, up from $ 118.60 in the same period a year earlier and higher than the $ 122.30 FactSet estimate.
The growth came was "primarily driven by strong adoption of our professional premium and advanced plans by new paying users as well as re-pricing and repackaging of our Plus SKU," Ajay Vashee, Dropbox's chief financial officer, said in a conference call with analysts on Thursday.
Deferred income came to $ 541.1 million. Analysts polled by FactSet were looking for $ 534 million.
In the quarter, Dropbox Spaces launched as a development of the shared folders, and the company said that Autodesk Marketing Manager Lisa Campbell and Intercom Operations Manager Karen Peacock joined the board.
In terms of guidance, Dropbox calls for $ 1,657 billion to $ 1,659 billion in revenue for the entire year. Analysts surveyed by Refinitive had projected $ 1,652 million.
The company aims for an operating margin of 14 to 15% in the fourth quarter, excluding certain items. FactSet consensus was 14.3%. With free cash flow for the entire year, Dropbox appears to come in the middle of the $ 375 million to $ 385 million range, which would be less than the $ 392 million FactSet estimate. The guiding factors for the cost of building Dropbox's new headquarters.
22. October Nomura Instinet analysts led by Christopher Eberle raised their rating on Dropbox to buy from Neutral. "We believe we are approaching revenue growth after six quarters of downturn as a public company," they wrote.
Dropbox share is up 2% since early 2019.
SE: Dropbox co-founder at CNBC @Work Summit and talks better tech