The subscription model is very desirable for businesses and investors as it generates recurring revenue, providing Dropbox with a steady stream of revenue annually. Source: Dropbox 1Q20 Investor’s Presentation Customers can opt for the plan which best suit their personal or business needs and pay either monthly or annually. Business Segmentsĭropbox mainly makes revenue through subscription plans for its cloud storage and collaborative services.

However, a deeper dive into Dropbox's fundamentals and business shows that the company remains very solid and has been adapting very well to the ever changing market. Some investors also worry that being a 'legacy' cloud provider, increasing competition from more established names such as Amazon ( AMZN ) and Microsoft ( MSFT ) could adversely affect Dropbox's business. Hence their mundane services of storage and collaboration do not provide the hype and fanfare that investors crave for. One reason that Dropbox could have been overlooked (relative to other cloud companies) is that Dropbox does not boast the impressive technologies or advanced artificial intelligence capabilities that others may have.

Yet, while most tech companies have seen >100% growth in the past three years, regardless of valuation or financials, investors of Dropbox during its IPO have almost zero returns!

This is rather unusual for a tech company given that on the surface, Dropbox's revenue has been increasing and cloud adoption is only expected to trend upwards. However, despite this increase, Dropbox is still trading at a similar level to its IPO price back in 2018. Like other technology companies, Dropbox's share price has seen a sharp increase in the past year, almost doubling from its pandemic lows. Founded in 2007, Dropbox ( NASDAQ: DBX) is an online cloud service provider which allows users to store, share and collaborate on their documents.

Dropbox storage rates