Dropbox Inc (NASDAQ:DBX) reported better-than-expected earnings for its third quarter.
Total revenue was $487.4 million, an increase of 14% from the same period last year. On a constant currency basis, year-over-year growth would have been 14%.
Total ARR ended at $1.981 billion, an increase of $49.8 million quarter-over-quarter and an increase of 12% year-over-year. On a constant currency basis, year-over-year growth would have been 13%.
Paying users ended at 15.25 million, as compared to 14.00 million for the same period last year. Average revenue per paying user was $128.03, as compared to $123.15 for the same period last year.
GAAP gross margin was 78.8%, as compared to 75.5% in the same period last year. Non-GAAP gross margin was 80.0%, as compared to 76.7% in the same period last year.
GAAP operating margin was 6.2%, as compared to (4.3)% in the same period last year. Non-GAAP operating margin was 23.0%, as compared to 13.1% in the same period last year.
GAAP net income (loss) was $32.7 million, as compared to ($17.0) million in the same period last year. Non-GAAP net income was $110.2 million, as compared to $55.9 million in the same period last year.
Net cash provided by operating activities was $200.9 million, as compared to $149.7 million in the same period last year. Free cash flow was $187.0 million, as compared to $102.5 million in the same period last year.
According to CEO Drew Houston, "Our margin expansion demonstrates the strength of our business model and execution against our long-term targets. We believe the opportunity to redesign work has never been bigger, and now, as a Virtual First company, we'll truly live our mission as we build better products for distributed teams."
DBX shares faded 72 cents, or 3.6%, to $19.40.
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