Even if that was their obligation (which it's not, as others have pointed out), there's no reason to believe that keeping the algorithm proprietary would be more profitable. They're not handing a critical capability to their competitors (competing with Dropbox isn't fundamentally about cheap storage). They don't have the infrastructure to licence the algorithm (who should they licence it to? For how much? Under which terms? Those are not simple questions to answer.)

Releasing it freely allows it to work its way into browsers, allowing Dropbox to serve up the smaller images directly to users, saving money on bandwidth. It allows other users to contribute improvements. It markets Dropbox as a desirable place to work for engineers.

Not obviously less profitable that the opposite.