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What Are Dropbox’s Key Revenue Growth Drivers?

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Jun. 30 2019, Updated 10:54 a.m. ET

Paying user growth

One of Dropbox’s (DBX) key metrics is its paying subscriber growth. At the end of the first quarter, Dropbox had 13.2 million paying users, up from 11.5 million in the first quarter of 2018. Its ARPU (average revenue per user) also rose from $114.30 to $121.04 in the same period.

This growth in ARPU and subscribers drove Dropbox’s sales up 22.0% in the first quarter.

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Google partnership

Dropbox has expanded its partnership with Google (GOOGL). It recently unveiled several new capabilities with Google Suite whereby users can integrate Google Docs, Slides, and Sheets with Dropbox.

During Dropbox’s earnings call, CEO Andrew Houston stated, “These capabilities make it easier for our users to organize and manage their content, control access and search the full text of their G Suite files natively within Dropbox.” Users will also be notified when someone adds comments to these docs, allowing them to stay up to date and manage work in a single platform.

HelloSign acquisition

Dropbox completed the HelloSign acquisition in the first quarter. HelloSign is an e-signature company, and Dropbox aims to leverage its expertise and gain traction in this market. Dropbox has also built new application program interface features to provide an enhanced experience for HelloSign users. Dropbox paid $230 million for this acquisition.

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