Drew Houston, Dropbox Co-Founder and CEO, speaking at CNBC’s @Work conference in San Francisco on November 4, 2019.
Arun Nevader | CNBC
Dropbox shares rose as much as 16% in extended trading before paring back much of their gains on Thursday after the company reported better-than-expected fourth-quarter results. The stock briefly exceeded the $21 price at which it sold shares in its initial public offering in 2018. The stock had not closed above $21 since September.
Here’s how the company did:
- Earnings: 16 cents per share, adjusted, vs. 14 cents per share as expected by analysts polled by Refinitiv.
- Revenue: $446 million, vs. $443 million as expected by analysts polled by Refinitiv.
Revenue grew about 19% in the quarter that ended on December 31, the company said in a statement, roughly growing at the same speed as in the third quarter.
Dropbox reported 14.3 million paying users in the fourth quarter, up from 14 million users in the previous quarter and above the 14.2 million expected among analysts surveyed by FactSet. Average revenue per paying user totaled $125, up from $123.15 one quarter earlier and more than the FactSet consensus estimate of $123.81.
Deferred revenue at the end of the fourth quarter was $554.2 million, below the $555.6 million FactSet consensus estimate.
In the fourth quarter Dropbox announced the departure of its chief customer officer, Yamini Rangan, who has since joined HubSpot.
“App usage trends have worsened since our August initiation, with downloads declining ~20% in Q4 and in-app purchase rev. decelerating significantly,” Bernstein analysts Zane Chrane and Michelle Isaacs, who have the equivalent of a sell rating on Dropbox stock, wrote in a note distributed to clients on Wednesday. “DAUs [Daily active users] are declining at a faster pace than in recent quartersMAU [Monthly active user] growth has also worsened, with MAUs declining ~20% y/y in Q4.”
CEO Drew Houston joined the board of Facebook earlier this month.
Executives will discuss the results with analysts and issue guidance on a conference call starting at 5 p.m. Eastern time.
Dropbox stock is up 3% since the beginning of 2020.
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WATCH: Short sellers take aim at Dropbox ahead of its fourth-quarter earnings report
