SAN FRANCISCO—Dropbox, Inc. (NASDAQ:), a $9.5 billion cloud storage company with impressive 82% gross profit margins according to InvestingPro, saw its Chief Financial Officer Regan Timothy recently sell a portion of his holdings in the company. According to a filing with the Securities and Exchange Commission, Timothy sold 2,500 shares of Dropbox Class A Common Stock on January 15, 2025. The shares were sold at a weighted average price of $30.3744, with the transaction totaling approximately $75,936.
The sale was executed as part of a pre-established Rule 10b5-1 trading plan, which Timothy adopted on May 15, 2024. This type of trading plan allows insiders to set up a predetermined schedule for selling shares, helping them avoid potential accusations of insider trading. The stock has shown strong momentum, gaining over 30% in the past six months.
Following the transaction, Timothy retains ownership of 401,264 shares, some of which are in the form of restricted stock awards and units that are subject to vesting schedules through February 15, 2028. If Timothy ceases to be a service provider before these dates, any unvested shares will be canceled by Dropbox.
This transaction is part of routine financial planning for executives and should not be interpreted as a reflection of Timothy’s outlook on the company’s future performance.
In other recent news, Dropbox has made significant strides in its financial and strategic alignment. The company recently announced a new share buyback program, authorizing an additional $1.2 billion in shares, adding to the existing $519 million remaining from previous buybacks. This move, acknowledged by BofA Securities as a positive step towards returning capital to shareholders, brings the total authorization for repurchases to approximately 19% of Dropbox’s current market capitalization.
Dropbox has also secured a $2 billion loan, primarily arranged by Blackstone (NYSE:) Credit & Insurance, and initiated a significant workforce reduction of 20%. This reduction aims to focus more on the development of its new AI-powered product, Dropbox . Despite a slight year-over-year revenue increase of 0.9% to $639 million, Dropbox managed to gain approximately 19,000 new paying users and reported a Non-GAAP net income of $190 million.
In terms of future expectations, Dropbox projects its Q4 revenue to be between $637 million and $640 million, with a full-year forecast of $2.542 billion to $2.545 billion. However, due to severance costs from workforce reductions, the free cash flow expectations for 2024 have been lowered to $860 million to $875 million. Looking ahead, Dropbox expects its 2025 constant currency revenue to remain flat compared to 2024, with an anticipated expansion of the Non-GAAP operating margin by approximately 150 basis points and free cash flow projected at or above $950 million.
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