DigitalOcean Holdings Inc (NYSE:DOCN) is scheduled to report second-quarter earnings before the open on Tuesday, Aug. 4. According to Zacks Research, analysts expect earnings of $0.26 per share on revenue of $276.15 million, representing a 55.9% year-over-year decline in earnings alongside 26.3% revenue growth. Investors will be watching for updates on AI infrastructure demand and the company's cloud computing business.
DOCN was last seen trading up 13.3% at $120.99, looking to snap a five-day losing streak after pulling back from its recent record high. Despite the recent weakness, the shares remain up roughly 150% year to date. The equity is also contending with pressure at its 30-day moving average, a trendline that has capped multiple rebound attempts in recent weeks.
Options traders have grown increasingly bearish ahead of the earnings event. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), DigitalOcean's 10-day put/call volume ratio of 1.84 ranks higher than 96% of readings from the past year.
Part of today's bounce could be attributed to short covering, as short interest represents 11.90% of the stock's available float after the recent pullback. It would take shorts over three days to cover their bets, at DOCN's average pace of trading.
