DigitalOcean Holdings, Inc. (NYSE: DOCN) saw its stock rise 12% on Tuesday following a corporate update that forecast record second quarter fiscal 2026 results and a significant expansion in contracted revenue. The company said it expects remaining performance obligations to top $800 million - more than a tenfold increase from the comparable quarter of fiscal 2025.
Management outlined a series of metrics pointing to accelerating growth. DigitalOcean now projects second quarter revenue growth of approximately 29%, up from a 14% pace in the same quarter last year. The company also indicated it expects to meet or exceed the high end of its prior guidance for adjusted EBITDA margin and non-GAAP net income per share for the quarter.
RPO dynamics were highlighted as a key development. DigitalOcean expects RPO to increase by more than $550 million during the second quarter of 2026, while the weighted average life of those obligations is projected to extend from 1.6 years to over 3 years. Those figures underscore a shift toward longer-dated, contracted customer commitments.
On the infrastructure front, DigitalOcean said it has secured an additional 20 megawatts of committed data center capacity that is expected to be available in late 2027 and early 2028. That incremental capacity brings the company's total committed footprint to roughly 155 megawatts. The company added that it continues to pursue further incremental capacity to support rising customer demand.
Customer momentum during the quarter included multiple nine-figure annual commitments tied to inference and cloud products. DigitalOcean said it expects this momentum to have a positive influence on previously provided guidance for exit 2026 revenue growth. The company will disclose more details when it releases quarterly earnings.
Observers should note that the company framed several items as expectations and projections, with additional information to follow in the formal earnings release. Until that report is published, the specifics behind the announced RPO growth, the timing and location of new data center capacity, and the composition of the large customer contracts remain subject to the more detailed disclosures the company plans to provide.