---
schema_version: "secwatch.filing_event.v1"
accession: "0001582961-23-000028"
form_type: "8-K"
ticker: "DOCN"
cik: "0001582961"
company_name: "DigitalOcean Holdings, Inc."
filed_at: "2023-08-03T23:59:59+00:00"
generated_at: "2026-06-12T08:18:28.024541+00:00"
event_type: "other_material"
sentiment: "negative"
materiality_score: 0.85
calibrated_materiality_score: 0.85
confidence: "high"
source: SEC EDGAR
---

# DigitalOcean restates Q1 financials, reports Q2 revenue growth but cannot report net income due to tax accounting errors

## Summary
- Q2 revenue $170M (+27% YoY); unable to report net income due to tax errors being finalized.
- Restating Q1 2023: income tax expense overstated by ~$18M from Section 174 error; net loss reduced.
- Material weakness in internal control over tax accounting; EY to revise 2022 ICFR opinion to adverse.
- Acquired Paperspace (AI/ML platform) closed July 5, 2023; deal terms not disclosed.
- Repurchased 2.78M shares for $103M in Q2; YTD total 10.54M shares for $369M.

## SEC filing metadata
- accession: 0001582961-23-000028
- form_type: 8-K
- ticker: DOCN
- cik: 0001582961
- company_name: DigitalOcean Holdings, Inc.
- filed_at: 2023-08-03T23:59:59+00:00
- event_type: other_material
- sentiment: negative
- materiality_score: 0.85
- calibrated_materiality_score: 0.85
- confidence: high
- sec_items: 2.02, 9.01, 4.02
- EDGAR index: https://www.sec.gov/Archives/edgar/data/1582961/000158296123000028/0001582961-23-000028-index.htm
- EDGAR primary document: https://www.sec.gov/Archives/edgar/data/1582961/000158296123000028/docn-20230728.htm

## Machine-readable alternates
- HTML: https://secwatch.observer/filing/0001582961-23-000028
- JSON: https://secwatch.observer/filing/0001582961-23-000028.json
- Plain text: https://secwatch.observer/filing/0001582961-23-000028.txt

## Key facts
- Auditor Changes
  DigitalOcean Holdings, Inc. reported that prior financial statements should not be relied upon.
  - Action: non reliance
  - Auditor: Ernst & Young LLP
  source text: 31, 2023, as included in the Company’s Quarterly Report on Form 10-Q for the three months ended March 31, 2023 filed with the Securities and Exchange Commission (the “SEC”) on May 9, 2023 (the “First Quarter 2023 10-Q”) should no longer be relied upon due to the discovery, in the course of preparing the Company’s interim financial statements for the fiscal quarter ended June 30, 2023, of errors in the Company’s accounting for income tax expense primarily relating to the calculation of certain capitalized research or experimental expenditures under Section 174 of the Internal Revenue Code of 1986, which impacted the Company’s income tax provision ("Section 174 Error"). Primarily as a result of the Section 174 Error, accrued taxes as of March 31, 2023 were overstated and the income tax expense for the three months ended March 31, 2023 was overstated by approximately $18 million. Additional
  evidence_url: https://www.sec.gov/Archives/edgar/data/1582961/000158296123000028/0001582961-23-000028-index.htm
- Earnings Releases
  DigitalOcean Holdings, Inc. reported second quarter ended June 30, 2023 results: revenue $170 million.
  - Period: second quarter ended June 30, 2023
  - Revenue: $170 million
  - Result: reported results
  source text: This information is intended to be furnished under Item 2.02 and --- EX-99.1 (EX-99.1) --- DigitalOcean Announces Second Quarter 2023 Financial Results Revenue grew 27% to $170 million Loss from Operations was $1.5 million and Adjusted EBITDA was $72 million $64 million of Operating Cash Flow and $45 million of Adjusted Free Cash Flow NEW YORK, August 3, 2023 –
  evidence_url: https://www.sec.gov/Archives/edgar/data/1582961/000158296123000028/0001582961-23-000028-index.htm

This AI-assisted summary is a reading aid. Review the linked SEC EDGAR filing before relying on any specific claim.