Dropbox's (NASDAQ:DBX) strong business growth persisted in the cloud storage specialist's second quarter, with revenue blowing past management's guidance range for the period. The robust momentum in the quarter even prompted management to significantly increase its outlook for full-year revenue.

In the company's second-quarter earnings release, Dropbox CEO Drew Houston was upbeat. "We added over a dozen new product features to our user and admin experiences, and strengthened our infrastructure, all while driving a 30% free cash flow margin," he said. 

Blue cloud illustration laid over blue circuitry

Image source: Getty Images.

Of course, the news released alongside the earnings report stating that Dropbox Chief Operating Officer Dennis Woodside is stepping down in early September managed to steal many headlines. But reported financial figures from the quarter are worth a close look. Here are the highlights from the Q2 update in eight key metrics.

1. Revenue soared 27%

Revenue increased 27% year over year to $339 million, coming in well above management's guidance for revenue between $328 million and $331 million for the period. Notably, this growth was almost in line with the 28% year-over-year revenue growth Dropbox posted in Q1.

Sequentially, quarterly revenue was up 7%. 

2. Paying users increased 20%

Helping drive this growth was a 20% year-over-year increase in paid users. Dropbox now has 11.9 million paying users, up from 9.9 million in the year-ago quarter.

Though this growth rate was strong, it was a deceleration from the 24% year-over-year increase in paid users Dropbox achieved in Q1.

3. Average revenue per paying user jumped 4.9%

Also helping revenue growth was an increase in average revenue per paying user. This metric in Q2 was $116.66, up 4.9% year over year, and marking an acceleration from the 3.2% year-over-year growth Dropbox saw in the metric in Q1.

4. Non-GAAP operating margin was 14.1%

Reflecting Dropbox's scalable business model, the company's second-quarter non-GAAP operating margin of 14.1% was not only up significantly from 8% in the year-ago quarter, but it crushed management's guidance range for non-GAAP operating margin between 9% and 10%.

5. Non-GAAP gross margin was 74.5%

Once again demonstrating how Dropbox's business model benefits from improved scale, the company's non-GAAP gross margin increased from 66.7% in the year-ago quarter to 74.5%. GAAP gross margin similarly grew from 65.4% to 73.6%.

6. Non-GAAP net income skyrocketed 140%

Dropbox's non-GAAP net income increased 140% year over year to $48 million, translating $0.11 per share. Non-GAAP EPS was up 83% from the prior-year period.

On a GAAP basis, Dropbox's net loss narrowed from a loss of $26.8 million in the year-ago quarter to a loss of $4.1 million in the second quarter of 2018. Similarly, Dropbox's GAAP loss per share improved from a loss of $0.14 to a loss of $0.01.

7. Free cash flow was $102.2 million

Free cash flow, or cash from operations minus capital expenditures, increased from $82.4 million in the prior-year quarter to $102.2 million.

8. Management expects full-year revenue to rise about 24%

Management raised its outlook for full-year revenue, guiding for its top line for 2018 to be between $1.366 billion and $1.372 billion. This midpoint of this range implies about 24% year-over-year growth.

Dropbox's revised guidance is up from a previous forecast for revenue to be between $1.343 billion and $1.355 billion. 

Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.