DigitalOcean Holdings Inc (DOCN)
Operating return on assets (Operating ROA)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|
| Operating income | US$ in thousands | 91,007 | 11,896 | -25,697 | -11,186 |
| Total assets | US$ in thousands | 1,639,020 | 1,460,970 | 1,815,630 | 2,101,000 |
| Operating ROA | 5.55% | 0.81% | -1.42% | -0.53% |
December 31, 2024 calculation
Operating ROA = Operating income ÷ Total assets
= $91,007K ÷ $1,639,020K
= 5.55%
Operating return on assets (ROA) is a key financial ratio that reflects the effectiveness of DigitalOcean Holdings Inc in generating operating profits relative to its total assets. The trend analysis of operating ROA for DigitalOcean over the period from December 31, 2021, to December 31, 2024, provides insight into the company's operational efficiency.
The operating ROA for DigitalOcean was as follows:
- December 31, 2021: -0.53%
- December 31, 2022: -1.42%
- December 31, 2023: 0.81%
- December 31, 2024: 5.55%
The negative operating ROA figures in 2021 and 2022 indicate that DigitalOcean was not efficiently utilizing its assets to generate operating profits during those years. However, there was a notable improvement in 2023, where the operating ROA turned positive at 0.81%, suggesting a better performance in generating profits from its asset base.
The most significant improvement was seen in 2024, with the operating ROA increasing substantially to 5.55%. This sharp rise indicates that DigitalOcean significantly enhanced its operating profitability relative to its asset base, reflecting improved operational efficiency and potentially better asset utilization.
Overall, the trend in operating ROA for DigitalOcean Holdings Inc shows a positive trajectory from 2021 to 2024, with the company successfully improving its operational performance and efficiency in generating profits from its assets over the period under review.
Peer comparison
Dec 31, 2024