By Munsif Vengattil
(Reuters) - File sharing and storage company Dropbox Inc (O:DBX) beat Wall Street expectations for quarterly results and topped estimates for paying subscribers in its first financial report as a publicly traded company.
However, the company's shares, which had gained 10 percent this week ahead of the earnings, slipped 4 percent in extended trading on Thursday.
The San Francisco-based company said the number of paying subscribers surged 23.7 percent to 11.5 million at the end of March, topping analysts' average estimate of 11.3 million, according to Thomson Reuters I/B/E/S.
The company, which started as a free service to share and store photos, music and other large files, has worked to build up its enterprise software offering.
Dropbox reported average revenue per user (ARPU) of $114.3 in the first quarter, beating analysts' estimate of $110.
"(ARPU growth) does suggest Dropbox is having success converting individual paid users to business paid users," D.A. Davidson analyst Rishi Jaluria said.
The company, which competes with Alphabet Inc's (O:GOOGL) Google, Microsoft Corp (O:MSFT) and Amazon.com Inc (O:AMZN) as well as Box Inc (N:BOX), forecast current-quarter revenue in the range of $328 million and $331 million.
Analysts were expecting revenue of $324.9 million.
"Today's earnings also bode well for existing investors that are still in their lock up period," said Minal Hasan, investor at K2 Global, a Silicon Valley-based venture capital firm that invests in startup companies.
Dropbox's quarterly loss widened to $465.5 million, as the company accounted for IPO-related expenses.
The company had a blockbuster debut on March 23 as investors bought into the biggest technology initial public offering in more than a year, with shares closing up more than 35 percent in their first day of trading.
On an adjusted basis, the company earned 8 cents per share, beating estimates of 5 cents.
Total revenue rose 28 percent to $316.3 million, above estimates of $309.2 million.
