(Reuters) – Dropbox Inc on Thursday reported a better-than-expected quarterly profit, raised its outlook for operating margin and announced a $600 million share buyback, sending its shares up 11% in trading after the bell.
FILE PHOTO: The Dropbox app logo seen on a mobile phone in this illustration photo October 16, 2017. REUTERS/Thomas White/Illustration
The company raised its operating margin target between 28% and 30%, which it expects to achieve by 2024, up from its initial range of 20% to 22%.
“The big story is the $600 million buyback, which is a clear indication that Dropbox views their stock as undervalued and that management is bullish on the future of the company,” said Rishi Jaluria, an analyst from brokerage D.A. Davidson & Co.
He added that the move was “pretty unusual” given that the company went public less than two years ago.
The company, which counts National Geographic and Spotify Technology SA among its customers, said it had 14.3 million paid…
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