SAN FRANCISCO - Dropbox, Inc. (NASDAQ:DBX) reported first quarter 2025 financial results that fell short of analyst expectations on the top line, sending shares down 0.77% in after-hours trading on Thursday.
The cloud storage and collaboration company posted revenue of $624.7 million for the quarter, down 1.0% year-over-year and below the consensus estimate of $630.83 million. On a constant currency basis, revenue decreased 0.6% compared to the same period last year.
Adjusted earnings per share came in at $0.70, beating analyst expectations of $0.63.
"We’ve had a productive start to the year improving the Dash user experience and making targeted investments to simplify and strengthen our core FSS product," said Dropbox Co-Founder and CEO Drew Houston.
The company reported 18.16 million paying users in Q1, flat compared to the year-ago quarter. Average revenue per paying user was $139.26, down slightly from $139.59 in Q1 2024.
Dropbox’s GAAP operating margin expanded to 29.4% from 22.7% in the prior year quarter. Non-GAAP operating margin rose to 41.7% from 36.5%.
For the second quarter, Dropbox expects revenue between $628 million and $632 million. The company did not provide full-year guidance.
While Dropbox beat on the bottom line, the revenue miss appears to be weighing on investor sentiment, as reflected in the slight after-hours stock decline. Management cited a "fluid" macro environment as they focus on execution and operating efficiency improvements.
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