1x Msft Share News (MSFT)

By Sweta Singh

March 23 (Reuters) - Having topped expectations with theupsized price of its initial public offering, Dropbox Incon Friday faces its next big challenge: a successfullaunch of trading when global stock markets are the defensiveand tech shares are particularly soft.

The cloud storage company's debut marks an end to a long dryspell in the U.S. IPO market and is the biggest tech IPO sinceSnapchat owner Snap Inc listed in March last year.

Its shares, which priced late Thursday at $21 a piece - $1above their projected range of $18 to $20, will debut on Nasdaqsometime after the market open, trading under the ticker "DBX."

The question is whether the hot demand that drove up its IPOprice underpins a strong bid for its shares on a day when U.S.equity index futures signal another rough trading session. TheS&P 500 and Nasdaq both tumbled more than 2percent on Thursday following the Trump administration'sannouncement of trade tariffs on China and on the week are downmore than 4 percent.

Still, the strength of the IPO, which was several timesoversubscribed, suggests to some that an open to the upside islikely.

"Dropbox is likely to jump at the open today. A jump to $25or more would not be surprising," said Jay Ritter, an IPO expertand professor at the University of Florida.

The IPO values Dropbox at $9.18 billion, not far from the$10 billion valuation the company had in its last privatefunding round. The debut is being closely watched for investorappetite for highly valued young tech companies with more than$1 billion in valuation that have a robust cash flow.

A strong debut would bode well for music streaming serviceSpotify - valued at roughly $19 billion in the privatemarkets - that has also filed for a direct listing and willstart trading on the New York Stock Exchange on April 3.

Dropbox is yet to turn in a profit, but that's common forstartups that invest heavily in growth. However, as a publiccompany Dropbox will be under pressure to quickly trim itslosses.

The company reported revenue of $1.11 billion in 2017, upfrom $844.8 million a year earlier. Full-year net loss nearlyhalved from the $210.2 million in 2016.

Its popular cloud storage platform has 500 millionregistered users and 11 million paid users and the companycompete with much larger companies such as Alphabet Inc'sGoogle, Microsoft Corp, Amazon.com Inc. Box Inc as its main rival.(Reporting by Sweta Singh in BengaluruAdditional reporting by Nikhil SubbaEditing by Dan Burns)