Dropbox Earnings: What To Look For From DBX

Adam Hejl /
2022/02/16 5:55 am EST
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Cloud storage and e-signature company Dropbox (Nasdaq: DBX) will be announcing earnings results tomorrow after market close. Here's what to expect.

Last quarter Dropbox reported revenues of $550.2 million, up 12.8% year on year, beating analyst revenue expectations by 1%. It was a mixed quarter for the company, with accelerating customer growth but moderate revenue growth. The company added 350,000 customers to a total of 16.49 million.

Is Dropbox buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Dropbox's revenue to grow 10.7% year on year to $558.4 million, slowing down from the 13% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.36 per share.

Dropbox Total Revenue

The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 0.92%.

Looking at Dropbox's peers in the productivity software segment, some of them have already reported Q4 earnings results, giving us a hint of what we can expect. ServiceNow (NYSE:NOW) delivered top-line growth of 29% year on year, beating analyst estimates by 0.6% and 8x8 (NYSE:EGHT) reported revenues up 14.7% year on year, exceeding estimates by 2.07%. ServiceNow traded up 9.6% on results, 8x8 was down 7.05%. Read our full analysis of ServiceNow's results here and 8x8's results here.

The tide has been turning for software investors recently, with SaaS stocks up on average 5.07% over the last month. Dropbox is up 4.8% during the same time, and is heading into the earnings with analyst price target of $34.4, compared to share price of $25.5.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.