Dropbox slips to a loss after taking $400 million real estate hit due to remote work

Drew Houston, Dropbox Co-Founder and CEO, talking at CNBC’s @Work convention in San Francisco on November 4, 2019.

Arun Nevader | CNBC

Dropbox on Thursday reported a $398.2 million one-time charge within the fourth quarter to reflect the firm’s shift to a ways away work.

Because the coronavirus emerged within the U.S. last 365 days, firms closed offices and pushed their workers to work from their properties. Some firms observed that the a ways away work did now no longer wound — and in some instances helped — productivity and employee pleasure, and sought to produce it extra everlasting. That can come at a stamp for firms with appreciable staunch-property footprints.

Dropbox, which makes cloud-based entirely storage and productivity software program and is identified for its lavish bid of job bid in San Francisco’s South of Market neighborhood, announced its “virtual first” a ways away-work plot in October.

“Some distance-off work (out of doors an bid of job) will be the foremost expertise for all workers and the day-to-day default for person work,” Dropbox mentioned in a blog post. Some bid of job bid will remain for collaboration, and Dropbox will sublease among the most bid.

In the first, 2d and third quarters of 2020, Dropbox reported ranking earnings after years of losing money. The impairment charge from “upright-of-utilize and diversified hire linked sources” that Dropbox disclosed in its fourth-quarter earnings assertion reverses that traipse, main to a virtually $346 million loss for the firm, when in contrast with a $33 million earnings within the third quarter.

The charge became excluded from non-GAAP outcomes, which mirrored 28 cents in earnings per piece, up from 16 cents within the 365 days-within the past quarter, and exceeded the consensus of 24 cents per piece anticipated by analysts polled by Refinitiv. Dropbox shares were down 1% in prolonged trading.

Earlier than Dropbox committed to having its of us work remotely, know-how firms including Atlassian, Twitter and Zillow had mentioned they’d enable workers to continue working from dwelling even after the pandemic subsides. Earlier this month, San Francisco’s greatest employer, Salesforce, mentioned that practically all of its workers will be in offices one to three days per week once or now no longer it’s honorable satisfactory to return.

In October, after hundreds of its workers had gotten dilapidated to working with out being subsequent to their colleagues, Pinterest mentioned it had agreed to pay $89.5 million to cease a hire for 490,000 square ft of bid of job bid end to its San Francisco headquarters. That manner, it effect now no longer must pay at the least $440 million in hire.

WATCH: Dropbox CEO on ‘virtual first’ initiative for workers to work-from-dwelling

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