NEW YORK, Jan 26, 2026, 13:15 (EST) — Regular session
Shares of DigitalOcean Holdings, Inc. surged almost 15% on Monday, building on a strong January rally as buyers targeted smaller cloud and AI infrastructure firms. The stock climbed 14.9% to $61.58, hitting a peak of $61.67 during trading.
This shift is significant as it thrusts DigitalOcean into the spotlight for fast-money traders amid a rotation toward growth stocks beyond just the mega-caps. U.S. benchmarks climbed, with the Invesco QQQ Trust and SPDR S&P 500 ETF each gaining roughly 0.6%.
Cloud and “edge” stocks climbed together. Cloudflare surged roughly 10%, while Fastly added around 7%, indicating Monday’s rally wasn’t limited to a single name.
DigitalOcean reached a 52-week peak at $57.27, data from Investing.com shows. The surge was driven by recent upgrades to price targets and the company’s strides in AI, which analysts say are boosting investor enthusiasm. (Investing)
The company has been sharpening its focus on AI “inference”—the phase where trained models operate in production to respond to users—and the expenses involved at scale. On Jan. 13, DigitalOcean announced that its Inference Cloud Platform, powered by AMD Instinct GPUs, doubled production inference throughput for Character.ai while slashing cost per token by 50%. Character.ai’s David Brinker commented that “the results exceeded expectations.” (Digitalocean)
A week later, DigitalOcean appointed Vinay Kumar as chief product and technology officer. He will oversee product strategy, cloud infrastructure, and security as the company expands its AI inference and core cloud services. Chief Executive Paddy Srinivasan highlighted Kumar’s experience building large-scale cloud and AI platforms. Kumar emphasized the opportunity to create a “purpose-built” AI inference cloud tailored for customers. (Digitalocean)
Wall Street is revising price targets higher amid growing interest in AI workloads. Barclays bumped its target to $63 from $49 and maintained an Overweight rating earlier this month, TheFly reported. (TipRanks)
That said, the setup works both ways. DigitalOcean faces stiff competition from larger, deeper-pocketed cloud rivals targeting developers and AI-native clients. And a stock that’s surged this sharply can just as easily reverse if growth or margins fall short of these heightened expectations.
Next on the calendar is earnings and guidance. DigitalOcean hasn’t set a date yet, but MarketBeat pins the report for Feb. 24 before markets open. Investors will be focused on whether the AI-inference buzz is showing up in revenue, customer retention, and the outlook for 2026. (Marketbeat)
