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Box(BOX) - 2025 Q4 - Annual Report
2025-03-10 20:06
Customer Retention and Satisfaction - The company's net retention rate was approximately 102% and 101% as of January 31, 2025 and 2024, respectively, indicating a stable customer base [78]. - The company faces risks related to customer satisfaction, pricing, and competition, which could affect its ability to retain customers and expand service usage [79]. - Customer dissatisfaction with service quality could harm the company's reputation and ability to attract new business [91]. - Failure to meet service level commitments may result in revenue impacts due to required service credits or subscription terminations [92]. - Increased demand for customer support services without corresponding revenue could negatively affect operating results [93]. Market Competition and Economic Conditions - The market for cloud content management services is highly competitive, with primary competitors including Microsoft and Google, which may lead to pricing pressures and reduced sales [76]. - Adverse economic conditions have historically resulted in reduced sales, longer sales cycles, and increased price competition, which could negatively impact the company's business [85]. - The focus on cloud content management for enterprise customers may lead to longer sales cycles and increased costs, impacting overall business performance [90]. - The company’s growth depends significantly on the widespread adoption of cloud computing and the cloud content management market, which may be influenced by economic conditions [81]. Product Development and Innovation - The introduction of new products and enhancements, such as Box AI and Box Hubs, is critical for maintaining market competitiveness and revenue growth [86]. - The company acquired Crooze Corporation in December 2023 and Alphamoon's intelligent document processing technology in August 2024 to enhance its service offerings [139]. Cybersecurity and Compliance Risks - The company faces significant cybersecurity threats, including potential breaches that could harm business operations and customer trust [101]. - The integration of AI technologies may increase cybersecurity risks, potentially leading to security breaches and incidents [102]. - The company faces significant risks related to cybersecurity, including potential breaches that could harm its reputation and market position [103]. - Increased sophistication of cyberattack techniques poses a heightened risk to the company's systems and data, particularly due to geopolitical tensions [104]. - Compliance with evolving privacy laws, such as the GDPR, could impose substantial costs and operational burdens on the company [107]. - The California Consumer Privacy Act (CCPA) and its amendments may require additional compliance efforts, impacting operational costs and customer relationships [110]. - The company anticipates ongoing costs related to detecting and preventing security breaches, which could affect financial performance [104]. - New regulations like the Digital Operational Resilience Act (DORA) could impose penalties of up to €5 million for non-compliance, affecting the company's operations [113]. Financial Performance and Capital Management - The company generated net losses since inception but was profitable in fiscal years 2025, 2024, and 2023 [186]. - The company may require additional capital for operations and growth, and there is uncertainty regarding the availability of such capital on favorable terms [150]. - Rising interest rates may adversely impact the company's access to equity-linked or debt capital and increase borrowing costs [152]. - The company must comply with various financial covenants that may restrict its business activities and financing capabilities [153]. - The company has U.S. federal net operating loss carryforwards of approximately $233.7 million, state net operating loss carryforwards of approximately $487.3 million, and foreign net operating loss carryforwards of approximately $268.5 million as of January 31, 2025 [164]. International Operations and Currency Risks - The company’s international operations expose it to risks such as currency exchange fluctuations and regulatory compliance [75]. - Currency exchange rate fluctuations, particularly with the Japanese Yen, have negatively impacted operating results and may continue to do so [95]. - Approximately one-third of the company's revenue is derived from customer contracts denominated in foreign currencies, including the Japanese Yen, Euro, and British Pound [331]. - For the year ended January 31, 2025, total revenue was negatively impacted by approximately 210 basis points due to foreign currency fluctuations [332]. - The company's total operating expenses were not materially affected by fluctuations in foreign currency exchange rates for the year ended January 31, 2025 [332]. - Foreign currency exchange gains and losses were not material for all periods presented [333]. - The company has entered into foreign currency derivative contracts to hedge a portion of its net outstanding monetary assets and liabilities [334]. Strategic Relationships and Growth - The company’s growth strategy includes forming strategic relationships with third parties, such as major tech companies, to expand market reach [125]. - The company must ensure interoperability with third-party systems to maintain competitiveness, as any degradation in service could adversely affect user growth [116]. Regulatory and Legal Risks - The company is subject to governmental export controls that could impair its ability to compete in international markets due to licensing requirements and economic sanctions [165]. - Changes in tariffs, sanctions, and trade restrictions may delay the introduction and sale of the company's services in international markets [167]. - The company has policies to comply with anti-bribery and anti-corruption laws, but violations could result in severe penalties and harm its reputation [169]. Stock and Shareholder Matters - In fiscal year 2025, the company repurchased 7.6 million shares for a total amount of $211.5 million, compared to 6.6 million shares for $177.0 million in fiscal year 2024 [179]. - The stock repurchase program may be suspended or terminated at any time and may not enhance long-term stockholder value [180]. - The market price of the company's Class A common stock has been volatile and may continue to fluctuate due to various factors [181]. - The holders of Series A Convertible Preferred Stock may influence certain governance and capitalization matters [196]. - The company's amended and restated bylaws include provisions that could delay or prevent hostile takeovers, affecting stockholder opportunities [173]. - The company’s bylaws designate Delaware courts as the exclusive forum for disputes, which may limit stockholders' ability to bring claims in their preferred judicial forum [175].
Box: Getting Closer, But Wait For A Deeper Dip Before Buying
Seeking Alpha· 2025-03-06 18:04
Group 1 - Market volatility has returned significantly, influenced by a busy earnings season and increasing geopolitical tensions, leading to the collapse of many rebound rallies in recent months as investors seek perfection amid high valuations [1] Group 2 - Gary Alexander has extensive experience in covering technology companies on Wall Street and working in Silicon Valley, providing insights into current industry themes [2]
BOX Q4 Earnings & Revenues Beat Estimates, Stock Falls on Weak View
ZACKS· 2025-03-05 18:31
Core Insights - Box reported fourth-quarter fiscal 2025 non-GAAP earnings of 42 cents per share, unchanged year over year, exceeding the Zacks Consensus Estimate by 2.44% [1] - Total revenues reached $279.5 million, surpassing the consensus mark by 0.19%, with a year-over-year increase of 6% on a reported basis and 8% on a constant-currency basis [2] Financial Performance - Billings for the quarter were $398.6 million, reflecting a 5% year-over-year increase (7% growth on a constant-currency basis), impacted by a 150-basis-point headwind from unfavorable forex [4] - The net retention rate improved to 102%, up 100 basis points year over year, with remaining performance obligations totaling $1.466 billion, a 12% year-over-year increase [5] - Non-GAAP gross margin expanded to 81%, up 260 basis points year over year, while operating expenses increased by 13.3% to $202.8 million [7] Product and Market Developments - Box introduced the Enterprise Advanced Suites plan, which integrates various Box applications and has seen strong market adoption [6] - The attach rate for Box Suites reached 87%, up from 81% in the previous year, contributing to 60% of total revenues [4] Cash Flow and Shareholder Returns - Cash and cash equivalents increased to $624.6 million, with cash generated from operations rising to $102.2 million [8][9] - Box repurchased 1.3 million shares for $43 million in the fourth quarter, with an additional $150 million authorized for stock repurchase [9] Guidance - For Q1 fiscal 2026, Box expects revenues between $274 million and $275 million, indicating a 4% rise year over year, with non-GAAP earnings projected at 25-26 cents per share [10][11] - For fiscal 2026, revenues are expected to be between $1.15 billion and $1.16 billion, reflecting a 6% year-over-year increase, with non-GAAP earnings anticipated between $1.13 and $1.17 per share [12][13]
Box(BOX) - 2025 Q4 - Earnings Call Transcript
2025-03-05 05:48
Financial Data and Key Metrics Changes - Box achieved revenue of $280 million in Q4 2025, up 6% year over year, or 8% in constant currency [10] - For fiscal 2025, revenue was $1.09 billion, up 5% year over year, and operating margin expanded by 320 basis points to 28% [11][37] - Q4 operating margin was 27.3%, and EPS was 42 cents, exceeding guidance by one cent [10][47] - Free cash flow for fiscal 2025 reached a record $305 million, up 13% year over year [37] Business Line Data and Key Metrics Changes - The launch of the Enterprise Advanced plan was a significant milestone, combining multiple products into a single offering [11][21] - The attach rate for suites in large deals was 87%, up from 81% a year ago, with suites now representing 60% of total revenue in Q4 [30][38] - The number of customers paying at least $100,000 annually increased by 8% year over year to approximately 1,920 [38] Market Data and Key Metrics Changes - Box's remaining performance obligations (RPO) grew by 12% year over year to $1.5 billion, indicating long-term customer commitment [40] - Q4 billings were $399 million, up 5% year over year, exceeding expectations despite a minor FX headwind [42] Company Strategy and Development Direction - The company is focusing on AI-driven solutions, emphasizing the importance of intelligent content management and automation [15][20] - Box plans to enhance its AI capabilities and expand its partner ecosystem to drive growth [58][59] - The company aims to leverage its intelligent content management platform to transform enterprise workflows [22][33] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the dynamic macro environment but expressed confidence in Box's ability to help customers drive efficiency and automation [78] - The net retention rate is expected to improve from 102% to 103% by the end of FY 2026, driven by pricing improvements and customer expansion [43][81] - Management highlighted the importance of AI in expanding the customer base and enhancing product offerings [120][122] Other Important Information - The company repurchased approximately 7.6 million shares for about $212 million in FY 2025, representing roughly 70% of free cash flow generation [48] - Box plans to provide more details on its roadmap and growth strategy during the upcoming financial analyst day on March 18th [34] Q&A Session Summary Question: Early momentum with Enterprise Advanced - Management was pleased with the results in Q4 for Enterprise Advanced, noting strong customer interest despite a short rollout period [66][68] Question: Macro environment impact on purchasing - Management acknowledged the dynamic macro environment but emphasized that Box's solutions are positioned to help customers drive efficiency [78] Question: Components of net retention rate - Management indicated that pricing improvements and stable churn rates are key drivers for expected net retention rate growth [81] Question: Core use cases for Enterprise Advanced - Management highlighted use cases such as AI-powered document processing and no-code app functionality as significant drivers of customer interest [92][94] Question: Go-to-market investments - Management discussed a methodical approach to go-to-market investments, focusing on key industries and system integrators [101][102] Question: Revenue seasonality and guidance - Management confirmed that Q1 revenue is expected to be lower due to a leap year impact but anticipates gradual acceleration in revenue growth throughout the year [116]
Box(BOX) - 2025 Q4 - Earnings Call Transcript
2025-03-05 00:57
Financial Data and Key Metrics Changes - Box achieved revenue of $280 million in Q4 2025, up 6% year over year, or 8% in constant currency [10] - For fiscal 2025, revenue was $1.09 billion, up 5% year over year, or 7% in constant currency [37] - Operating margin for Q4 was 27.3%, and for fiscal 2025, it expanded by 320 basis points to 28% [11][37] - EPS for Q4 was 42 cents, exceeding guidance by one cent, and for fiscal 2025, EPS was $1.71, up 17% year over year [10][37] - Free cash flow for fiscal 2025 reached a record $305 million, up 13% year over year [37] Business Line Data and Key Metrics Changes - The launch of the Enterprise Advanced plan contributed to several dozen deals closed in Q4, indicating strong customer demand [12][66] - Suites represented 87% of deals over $100,000, up from 81% a year ago, and accounted for 60% of total revenue in Q4, compared to 55% a year ago [30][38] - Remaining performance obligations (RPO) grew to $1.5 billion, a 12% year-over-year increase [40] Market Data and Key Metrics Changes - Approximately 1,920 total customers are paying at least $100,000 annually, up 8% year over year [38] - The net retention rate for Q4 was 102%, up from 101% a year ago, with an annualized churn rate of 3% [43] Company Strategy and Development Direction - Box is focusing on an AI-first enterprise strategy, leveraging AI to enhance productivity and automate workflows [16][22] - The company plans to advance its platform in FY 2026, with significant product announcements and enhancements to Box apps and AI capabilities [23][24] - Box aims to strengthen its partner ecosystem and expand its go-to-market strategy, particularly in key industries [32][102] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in Box's position to help customers drive efficiency and automation amid a dynamic macro environment [78] - The company anticipates gradual revenue growth acceleration throughout FY 2026, driven by investments in Enterprise Advanced and AI capabilities [116] Other Important Information - Box repurchased approximately 7.6 million shares for about $212 million in FY 2025, representing roughly 70% of free cash flow generation [48] - The company expects a non-GAAP EPS headwind in FY 2026 due to incremental non-cash deferred tax expenses [50] Q&A Session Summary Question: Early momentum with Enterprise Advanced - Management was pleased with the results in Q4 for Enterprise Advanced, noting strong customer interest and dozens of deals closed [66][68] Question: Direct vs. indirect sales mix - Management indicated a shift towards more indirect sales through partners, especially in regions outside Japan [72][74] Question: Macro environment impact on purchasing - Management acknowledged the dynamic macro environment but emphasized Box's role in helping customers drive efficiency and automation [78] Question: Components of net retention rate - Management expects improvements in net retention rate driven by pricing contributions from Enterprise Advanced, with minimal contributions from seat growth [81][82] Question: Core use cases for Enterprise Advanced - Key use cases include AI-powered document processing and no-code app functionality, which are driving customer interest [92][94] Question: Go-to-market investments - Management is making methodical investments in key markets and system integrators to enhance sales capacity and drive growth [102][106] Question: Revenue seasonality and guidance - Management expects gradual revenue growth acceleration throughout FY 2026, with Q1 being lower due to the leap year impact [116]
Markets Break Lower as Tariff Realities Manifest
ZACKS· 2025-03-05 00:10
Market Overview - The Dow Jones Industrial Average fell by 670 points, or 1.55%, while the S&P 500 decreased by 71 points, or 1.22%. The Nasdaq experienced a smaller decline of 65 points, or 0.35%, and the Russell 2000 dropped by 22 points, or 1.08% [1] - The overall market is experiencing a downturn, with the Dow down 4.5% over the past month, the S&P 500 down 4.3%, and the Nasdaq down 6.9%. The Russell 2000 has seen a significant decline of 9.2% since early February [3] Trade and Economic Context - The ongoing trade war involving the U.S. and its top trade partners—Canada, China, and Mexico—is contributing to increased production costs, causing market instability. The market is awaiting President Trump's address to Congress for potential changes in tariff rhetoric [2] Company Earnings Reports - **Crowdstrike (CRWD)** reported Q4 earnings of $1.79 per share, exceeding the consensus of $1.65, but revenues of $5.91 billion fell short of the expected $5.95 billion. Guidance for the next quarter has softened, with expectations now between -3% to flat, leading to a 4% drop in shares [4] - **Flutter Entertainment (FLUT)**, the parent company of FanDuel, reported Q4 earnings of $2.94 per share, significantly above the expected $1.56 per share. Revenues reached $3.79 billion, surpassing the consensus of $3.75 billion, resulting in a 1.4% increase in shares after hours [5] - **Box (BOX)** posted Q4 earnings of 42 cents per share, slightly above expectations, with revenues of $280 million also beating the forecast of $278.99 million. However, weak guidance led to a 7% decline in shares [6]
Box (BOX) Beats Q4 Earnings and Revenue Estimates
ZACKS· 2025-03-04 23:30
Group 1: Earnings Performance - Box reported quarterly earnings of $0.42 per share, exceeding the Zacks Consensus Estimate of $0.41 per share, with an earnings surprise of 2.44% [1] - The company achieved revenues of $279.52 million for the quarter ended January 2025, surpassing the Zacks Consensus Estimate by 0.19% and showing an increase from $262.88 million year-over-year [2] - Over the last four quarters, Box has consistently surpassed consensus EPS estimates and revenue estimates [2] Group 2: Stock Performance and Outlook - Box shares have increased by approximately 3.7% since the beginning of the year, contrasting with a -0.5% decline in the S&P 500 [3] - The future performance of Box's stock will largely depend on management's commentary during the earnings call and the company's earnings outlook [4][6] - The current consensus EPS estimate for the upcoming quarter is $0.43 on revenues of $279.26 million, and for the current fiscal year, it is $1.82 on revenues of $1.15 billion [7] Group 3: Industry Context - The Internet - Software industry, to which Box belongs, is currently ranked in the bottom 46% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Box's stock performance [5]
Box(BOX) - 2025 Q4 - Earnings Call Presentation
2025-03-04 22:18
Financial Performance - Q4'25 revenue reached $280 million[7], driven by Suites momentum[6] - Total Remaining Performance Obligations (RPO) increased by 12% year-over-year to $1.466 billion[9, 10], or 14% in constant currency[9] - Billings increased by 5% year-over-year to $399 million[13, 14], or 7% in constant currency[13] - Non-GAAP gross margin improved to 81.0%[17] in Q4'25, up 260 bps year-over-year[17], driven by public cloud migration[16] - Non-GAAP operating margin increased to 27.3%[20] in Q4'25, up 60 bps year-over-year[20] Share Repurchase Program - In Q4'25, the company repurchased approximately 1.3 million shares for approximately $43 million[26] - In fiscal year 2025, the company repurchased approximately 7.6 million shares for approximately $212 million[26] - As of January 31, 2025, the company had approximately $52 million of remaining buyback capacity[26] - The Board of Directors authorized an expansion of the stock repurchase program by $150 million on March 3, 2025[26] Guidance and Customer Metrics - Q1'26 revenue is projected to be between $274 million and $275 million[30], representing a 4% year-over-year growth[30] - FY26 revenue is projected to be between $1.15 billion and $1.16 billion[30], representing a 6% year-over-year growth[30] - The company maintains a stable net retention rate of 102%[41, 42] - Customers paying more than $100k annually grew by 8% year-over-year, reaching 1,920[48]
Box(BOX) - 2025 Q4 - Annual Results
2025-03-04 21:05
Revenue and Growth - Fourth quarter revenue reached $280 million, with fiscal 2025 revenue totaling $1.09 billion, reflecting a 5% year-over-year increase[1] - Revenue for the three months ended January 31, 2025, was $279.52 million, an increase of 6.3% from $262.88 million for the same period in 2024[37] - Fiscal year 2026 revenue guidance is projected between $1.155 billion and $1.160 billion, indicating a 6% year-over-year growth[15] Profitability Metrics - Non-GAAP operating income for the fourth quarter was $76.4 million, representing 27.3% of revenue, an increase from 26.7% in the prior year[3] - GAAP diluted earnings per share (EPS) for the fourth quarter was $1.12, compared to $0.57 in the previous year, influenced by a net tax benefit of $1.04[3] - Net income attributable to common stockholders for the three months ended January 31, 2025, was $168.07 million, representing a 100.0% increase from $84.08 million in the same period last year[37] - Basic net income per share attributable to common stockholders increased to $1.17 for the three months ended January 31, 2025, compared to $0.58 in 2024[37] - Non-GAAP net income per share attributable to common stockholders for the three months ended January 31, 2025, was $0.42, consistent with the same period in 2024[47] Cash Flow and Liquidity - The company reported a record non-GAAP free cash flow of $91.3 million for the fourth quarter, up 12% year-over-year[3] - Cash provided by operating activities for the three months ended January 31, 2025, was $102.17 million, compared to $89.34 million in the same period of 2024[40] - The company reported a net cash increase of $16.06 million for the three months ended January 31, 2025, compared to a $5.79 million increase in the same period last year[40] - GAAP net cash provided by operating activities for the fiscal year ended January 31, 2025, was $332.26 million, compared to $318.73 million in 2024, reflecting an increase of 4.2%[42] - Non-GAAP free cash flow for the fiscal year ended January 31, 2025, was $304.61 million, up from $268.97 million in 2024, representing a growth of 13.2%[42] Balance Sheet Highlights - Box's total assets increased to $1,667,520,000 as of January 31, 2025, up from $1,241,163,000 a year earlier, representing a growth of approximately 34.4%[34] - Cash and cash equivalents rose to $624,575,000, compared to $383,742,000 in the previous year, indicating a significant increase of about 62.7%[34] - Total current liabilities increased to $922,076,000 from $679,280,000, reflecting a rise of approximately 35.8%[34] - Deferred revenue grew to $588,379,000, up from $562,859,000, marking an increase of about 4.5%[34] - Box's accumulated deficit decreased to $962,143,000 from $1,206,764,000, showing an improvement of approximately 20.3%[34] Operating Performance - Total operating expenses for the fiscal year ended January 31, 2025, were $782.39 million, an increase of 7.7% from $726.38 million in 2024[37] - GAAP operating margin for the three months ended January 31, 2025, was 6.4%, down from 8.1% in the same period of 2024[42] - Non-GAAP operating margin for the fiscal year ended January 31, 2025, was 27.9%, an increase from 24.7% in 2024[42] Stock and Shareholder Returns - The company announced a new $150 million expansion of its stock repurchase program, with approximately $52 million remaining under the current plan[9] - Stock-based compensation expense for the fiscal year ended January 31, 2025, totaled $219.00 million, up from $198.78 million in 2024[37] Future Outlook - GAAP operating margin for fiscal year 2026 is expected to be approximately 7.5%, while non-GAAP operating margin is projected at around 28%[15] - The company expects GAAP net income per share attributable to common stockholders for the fiscal year ending January 31, 2026, to range from $0.10 to $0.14[47] Product and Market Developments - The launch of the Enterprise Advanced Suites plan has garnered significant market interest, integrating various capabilities of the Intelligent Content Management platform[8] - Box has expanded AI availability to customers on various plans and introduced Box AI Units to facilitate AI usage management[8] Performance Measures - Billings, which include sales to new customers and subscription renewals, are considered a significant performance measure for Box[28] - Remaining performance obligations (RPO) indicate contracted revenue not yet recognized, which is crucial for future revenue projections[29] - Box's non-GAAP free cash flow is defined as cash flows from operating activities less net capital expenditures, providing insights into cash generation capabilities[30] - Non-GAAP gross profit and margin metrics are utilized to provide insights into Box's core business performance, excluding stock-based compensation and other special items[22]
Jack in the Box: Why Earnings Trends Matter More Than The CEO Shift
Seeking Alpha· 2025-03-03 03:08
Group 1 - The article discusses the volatility in the restaurant stocks market, highlighting the importance of advanced analytical models and specialized valuation techniques for investors [1] - The company, Goulart's Restaurant Stocks, focuses on analyzing various segments of the restaurant industry in the U.S., including QSR, fast casual, casual dining, fine dining, and family dining [1] - The founder of Goulart's Restaurant Stocks has a strong background in Business Administration and Accounting, complemented by an MBA in Forensic Accounting and Controllership, which enhances the analytical capabilities of the company [1] Group 2 - The company actively engages in academic and journalistic initiatives, contributing to institutions that promote individual and economic freedom, indicating a commitment to broader economic discussions [1] - The founder previously wrote columns on monetary policy, financial education, and financial modeling, aiming to make complex financial subjects accessible to a wider audience [1]