BOX Box Inc

Revenue of $276 Million, up 5% Year-Over-Year, up 6% in Constant Currency

Remaining Performance Obligations of $1.3 Billion, up 13% Year-Over-Year, up 14% in Constant Currency

Record GAAP Operating Margin of 8.5% and Record Non-GAAP Operating Margin of 29.1%

GAAP Net Income Per Share of $0.05 and Record Non-GAAP Net Income Per Share of $0.45

Box, Inc. (NYSE:BOX), the leading Intelligent Content Management (ICM) platform, today announced preliminary financial results for the third quarter of fiscal year 2025, which ended October 31, 2024.

“We delivered strong Q3 financial results and unveiled the most transformational product line-up in Box history,” said Aaron Levie, co-founder and CEO of Box. “Now businesses of all sizes will be able to realize the full value of their content and leverage the data inside their files to drive innovation, automate processes, and secure their most important information as we drive a new era of Intelligent Content Management.”

“Third quarter revenue growth of 5% year-over-year, or 6% in constant currency, came in at the high-end of our guidance,” said Dylan Smith, co-founder and CFO of Box. “With operational discipline built into the core of our company, we drove record gross and operating margins in the quarter. Our efficient cost structure enables us to continue to make meaningful investments in our sales and marketing programs and product roadmap as we deliver the leading Intelligent Content Cloud for the enterprise.”

Fiscal Third Quarter Financial Highlights

• Revenue for the third quarter of fiscal 2025 was $275.9 million, a 5% increase from revenue for the third quarter of fiscal 2024 of $261.5 million, or 6% growth on a constant currency basis.
• Remaining performance obligations (“RPO”) as of October 31, 2024 were $1.282 billion, a 13% increase from RPO as of October 31, 2023 of $1.131 billion, or 14% growth on a constant currency basis.
• Billings for the third quarter of fiscal 2025 were $264.7 million, a 4% increase from billings for the third quarter of fiscal 2024 of $253.7 million, or 3% growth on a constant currency basis. Third quarter billings were impacted by a roughly 100 basis point tailwind from FX versus our prior expectations of 210 basis point tailwind.
• GAAP gross profit for the third quarter of fiscal 2025 was a record $220.4 million, or 79.9% of revenue. This compares to a GAAP gross profit of $192.3 million, or 73.5% of revenue, in the third quarter of fiscal 2024.
• Non-GAAP gross profit for the third quarter of fiscal 2025 was a record $226.1 million, or 81.9% of revenue. This compares to a non-GAAP gross profit of $199.6 million, or 76.3% of revenue, in the third quarter of fiscal 2024.
• GAAP operating income in the third quarter of fiscal 2025 was a record $23.4 million, or 8.5% of revenue. This compares to a GAAP operating income of $11.4 million, or 4.4% of revenue, in the third quarter of fiscal 2024.
• Non-GAAP operating income in the third quarter of fiscal 2025 was a record $80.2 million, or 29.1% of revenue. This compares to a non-GAAP operating income of $64.6 million, or 24.7% of revenue, in the third quarter of fiscal 2024.
• GAAP diluted net income per share attributable to common stockholders in the third quarter of fiscal 2025 was $0.05 on 149.1 million weighted-average shares outstanding. This compares to GAAP diluted net income per share attributable to common stockholders of $0.04 in the third quarter of fiscal 2024 on 147.6 million weighted-average shares outstanding. GAAP diluted net income per share attributable to common stockholders in the third quarter of fiscal 2025 includes a negative impact of $0.02 year-over-year from unfavorable foreign exchange rates.
• Non-GAAP diluted net income per share attributable to common stockholders in the third quarter of fiscal 2025 was a record $0.45 on 149.5 million weighted-average shares outstanding. This compares to non-GAAP diluted net income per share attributable to common stockholders of $0.36 in the third quarter of fiscal 2024 on 147.6 million weighted-average shares outstanding. Non-GAAP diluted net income per share attributable to common stockholders in the third quarter of fiscal 2025 includes a negative impact of $0.02 year-over-year from unfavorable foreign exchange rates.
• Net cash provided by operating activities in the third quarter of fiscal 2025 was $62.6 million, a 13% decrease from net cash provided by operating activities of $71.8 million in the third quarter of fiscal 2024.
• Non-GAAP free cash flow in the third quarter of fiscal 2025 was $57.4 million, a 2% decrease from non-GAAP free cash flow of $58.3 million in the third quarter of fiscal 2024.
• Raised $460 million through a convertible debt offering, with convertible notes due September 15, 2029.

Growth on a constant currency basis and impact from foreign exchange is determined by comparing current period reported results with the current results calculated using the equivalent rates in the prior period.

For more information on the non-GAAP financial measures and key metrics discussed in this press release, please see the section titled, “About Non-GAAP Financial Measures and Other Key Metrics,” and the reconciliations of non-GAAP financial measures and certain key metrics to their nearest comparable GAAP financial measures at the end of this press release.

Recent Business Highlights

• Delivered wins or expansions with leading organizations across a variety of industries, including Aerospace (Blue Origin), Financial Services (Citadel Enterprise Americas and Moelis & Company), Legal (Gibson Dunn and Morgan Lewis), Life Sciences (Biogen and Catalent Pharma Solutions), Public Sector (Food & Drug Administration and Naval Air Systems Command), Manufacturing (Veeco Instruments and Vulcan Materials), and Media and Entertainment (Lionsgate, San Antonio Spurs and Serviceplan).
• Introduced a new Suites plan, Enterprise Advanced, to allow customers to access the full power of the Intelligent Content Management platform, which includes:
  • Box Forms, allowing users to easily design and publish engaging web and mobile forms; and Doc Gen, which automatically creates custom documents within Box by pulling data from Box Forms, third-party apps, custom apps, and metadata.
  • Box AI Studio, allowing admins to select their preferred AI model from Box’s list of trusted providers to create tailored Box AI agents, with no coding required.
  • Box Apps beta, a no-code solution that makes it easier to create intelligent applications that manage content-centric business processes throughout the enterprise.
  • A new suite of advanced data security and compliance features including Box Archive and Content Recovery.
  • Enhanced developer tools including the Doc Gen API, Box AI API Metadata Extract and Box AI API and higher API allocations.
• Announced the general availability of Box Hubs, revolutionizing content publishing in the enterprise and allowing users to extract insights from their enterprise content with Box AI.
• Announced that Box received its “In Process” designation for FedRAMP High from the Federal Risk and Authorization Management Program Management Office.
• Expanded its strategic partnership with Amazon Web Services (AWS), allowing customers to access foundation models directly in Box AI using Amazon Bedrock, starting with Anthropic’s Claude and Amazon Titan.
• Announced a new AI partnership with Slalom to help customers leverage advanced AI and machine learning to unlock valuable insights from their content.
• Hosted BoxWorks 2024, attracting thousands of attendees and customer speakers from leading organizations in-person in San Francisco and virtually.
• Recognized as a Leader in the IDC MarketScape: Worldwide Intelligent Content Services 2024 Vendor Assessment.
• Announced the fourth-annual Box Impact Fund, which awards a total of $150K to six nonprofits pursuing digital transformation projects. Each organization will receive a $25K grant to help fuel critical missions and digitally transform the nonprofit workplace.

Outlook

As a reminder, approximately one third of Box’s revenue is generated outside of the U.S., of which approximately 65% is in Japanese Yen. The following guidance includes the expected impact of FX headwinds, assuming present foreign currency exchange rates.

Additionally, as we have become consistently profitable in our international business, in the fourth quarter of fiscal year 2024 we released the valuation allowance against our deferred tax assets in the United Kingdom. Accordingly, in fiscal year 2025 we are recognizing deferred tax expense in the United Kingdom. This non-cash expense is reflected in our GAAP and non-GAAP diluted net income per share guidance for the fourth quarter of fiscal year 2025 and full fiscal year 2025.

Q4 FY25 Guidance

• Revenue is expected to be approximately $279 million, up 6% year-over-year, or 7% growth on a constant currency basis.
• GAAP operating margin is expected to be approximately 7.5%, and non-GAAP operating margin is expected to be approximately 27.5%.
• GAAP net income per share attributable to common stockholders is expected to be approximately $0.07. GAAP EPS guidance includes an expected negative impact of $0.02 from unfavorable exchange rates and $0.01 from the recognition of deferred tax expenses in international countries.
• Non-GAAP diluted net income per share attributable to common stockholders is expected to be approximately $0.41. Non-GAAP EPS guidance includes an expected negative impact of $0.02 from unfavorable exchange rates and $0.01 from the recognition of deferred tax expenses in international countries.
• Weighted-average diluted shares outstanding are expected to be approximately 151 million.

Full Year FY25 Guidance

• Revenue is expected to be approximately $1.090 billion, up 5% year-over-year, or 7% growth on a constant currency basis. We now expect FX to be a 190 basis point headwind to full fiscal year 2025 revenue growth, 20 basis points higher than our previous expectations. On a constant currency basis, our new guidance represents a $3 million increase from our previous guidance.
• GAAP operating margin is expected to be approximately 7.5%, and non-GAAP operating margin is expected to be approximately 28%. For full fiscal year 2025 GAAP and non-GAAP operating margin, we now expect FX to be a headwind of 140 basis points, 10 basis points higher than our previous expectations.
• GAAP net income per share attributable to common stockholders is expected to be approximately $0.30. FY25 GAAP EPS guidance includes an expected negative impact of $0.13 from unfavorable exchange rates and $0.05 from the recognition of deferred tax expenses in international countries.
• Non-GAAP diluted net income per share attributable to common stockholders is expected to be approximately $1.70. FY25 non-GAAP EPS guidance includes an expected negative impact of $0.13 from unfavorable exchange rates and $0.05 from the recognition of deferred tax expenses in international countries.
• Weighted-average diluted shares outstanding are expected to be approximately 149 million.

All forward-looking non-GAAP financial measures contained in this section titled “Outlook” exclude estimates for stock-based compensation expense, intangible assets amortization, and as applicable, other special items. Box has provided a reconciliation of GAAP to non-GAAP net income per share and operating margin guidance at the end of this press release.

Webcast and Conference Call Information

Box’s management team will host a conference call today beginning at 2:00 p.m. (PT) / 5:00 p.m. (ET) to discuss Box’s financial results, business highlights and future outlook. A live audio webcast of this call will be available through Box’s Investor Relations website at https://www.boxinvestorrelations.com for a period of 90 days after the date of the call. Prepared remarks will be available on the Box Investor Relations website after the call ends.

The conference call can be accessed by registering online at https://events.q4inc.com/attendee/640324096 at which time registrants will receive dial-in information as well as a conference ID.

A live webcast will be accessible from the Box investor relations website at www.boxinvestorrelations.com. A replay will be available at the same webcast link until 11:59 p.m. on December 2, 2025.

Box has used, and intends to continue to use, its Investor Relations website (www.box.com/investors), as well as certain X accounts (@box, @levie and @boxincir), as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD. Information on or that can be accessed through Box’s Investor Relations website, these X accounts, or that is contained in any website to which a hyperlink is provided herein is not part of this press release, and the inclusion of Box’s Investor Relations website address, these X accounts, and any hyperlinks are only inactive textual references.

This press release, the financial tables, as well as other supplemental information including the reconciliations of non-GAAP financial measures and certain key metrics to their nearest comparable GAAP financial measures, are also available on Box’s Investor Relations website. Box also provides investor information, including news and commentary about Box’s business and financial performance, Box’s filings with the Securities and Exchange Commission, notices of investor events and Box’s press and earnings releases, on Box’s Investor Relations website.

Forward-Looking Statements

This press release contains forward-looking statements that involve risks, uncertainties, and assumptions, including statements regarding Box’s expectations regarding its growth and profitability, the size of its market opportunity, its investments in go-to-market programs, the demand for its products, the potential of AI and its impact on Box, the timing of recent and planned product introductions, enhancements and integrations, the short- and long-term success, market adoption and retention, capabilities, and benefits of such product introductions and enhancements, the success of strategic partnerships and acquisitions, the impact of macroeconomic conditions on its business, its ability to grow and scale its business and drive operating efficiencies, the impact of fluctuations in foreign currency exchange rates on its future results, its net retention rate, its ability to achieve revenue targets and billings expectations, its revenue and billings growth rates, its ability to expand operating margins, its revenue growth rate plus free cash flow margin in fiscal year 2025 and beyond, its long-term financial targets, its ability to maintain profitability on a quarterly or ongoing basis, its free cash flow, its ability to continue to grow unrecognized revenue and remaining performance obligations, its revenue, billings, GAAP and non-GAAP gross margins, GAAP and non-GAAP net income per share, GAAP and non-GAAP operating margins, the related components of GAAP and non-GAAP net income per share, weighted-average outstanding share count expectations for Box’s fiscal fourth quarter and full fiscal year 2025 in the section titled “Outlook” above, equity burn rate, any potential repurchase of its common stock, whether, when, in what amount and by what method any such repurchase would be consummated, and the share price of any such repurchase. There are a significant number of factors that could cause actual results to differ materially from statements made in this press release, including: (1) adverse changes in general economic or market conditions, including those caused by the Russia-Ukraine conflict and the conflict in the Middle East, inflation, and fluctuations in foreign currency exchange rates; (2) delays or reductions in information technology spending; (3) factors related to Box’s highly competitive market, including but not limited to pricing pressures, industry consolidation, entry of new competitors and new applications and marketing initiatives by Box’s current or future competitors; (4) the development of the cloud content management market; (5) the risk that Box’s customers do not renew their subscriptions, expand their use of Box’s services, or adopt new products offered by Box on a timely basis, or at all; (6) Box’s ability to provide timely and successful enhancements, integrations, new features and modifications to its platform and services; (7) actual or perceived security vulnerabilities in Box’s services or any breaches of Box’s security controls; (8) Box’s ability to realize the expected benefits of its third-party partnerships; and (9) Box’s ability to successfully integrate acquired businesses and achieve the expected benefits from those acquisitions. In addition, the preliminary financial results set forth in this release are estimates based on information currently available to Box. While Box believes these estimates are meaningful, they could differ from the actual amounts that Box ultimately reports in its Quarterly Report on Form 10-Q for the fiscal quarter ended October 31, 2024. Box assumes no obligations and does not intend to update these estimates prior to filing its Form 10-Q for the fiscal quarter ended October 31, 2024.

Additional information on potential factors that could affect Box’s financial results is included in the reports on Forms 10-K, 10-Q and 8-K and in other filings Box makes with the Securities and Exchange Commission from time to time, including the Quarterly Report on Form 10-Q filed for the fiscal quarter ended July 31, 2024. These documents are available on the SEC Filings section of Box’s Investor Relations website located at www.boxinvestorrelations.com. Box does not assume any obligation to update the forward-looking statements contained in this press release to reflect events that occur or circumstances that exist after the date on which they were made.

About Non-GAAP Financial Measures and Other Key Metrics

To supplement Box’s consolidated financial statements, which are prepared and presented in accordance with GAAP, Box provides investors with certain non-GAAP financial measures and other key metrics, including non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income, non-GAAP operating margin, non-GAAP net income attributable to common stockholders, non-GAAP net income per share attributable to common stockholders, billings, remaining performance obligations, non-GAAP free cash flow and free cash flow margin. The presentation of these non-GAAP financial measures and key metrics is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures and key metrics, please see the reconciliation of these non-GAAP financial measures and certain key metrics to their nearest comparable GAAP financial measures at the end of this press release.

Box uses these non-GAAP financial measures and key metrics for financial and operational decision-making (including for purposes of determining variable compensation of members of management and other employees) and as a means to evaluate period-to-period comparisons. Box’s management believes that these non-GAAP financial measures and key metrics provide meaningful supplemental information regarding Box’s performance by excluding certain expenses that may not be indicative of Box’s recurring core business operating results. Box believes that both management and investors benefit from referring to these non-GAAP financial measures and key metrics in assessing Box’s performance and when planning, forecasting, and analyzing future periods. These non-GAAP financial measures and key metrics also facilitate management's internal comparisons to Box’s historical performance as well as comparisons to Box’s competitors' operating results. Box believes these non-GAAP financial measures and key metrics are useful to investors both because they (1) allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) are used by Box’s institutional investors and the analyst community to help them analyze the health of Box’s business.

A limitation of non-GAAP financial measures and key metrics is that they do not have uniform definitions. Further, Box’s definitions will likely differ from the definitions used by other companies, including peer companies, and therefore comparability may be limited. Thus, Box’s non-GAAP financial measures and key metrics should be considered in addition to, and not as a substitute for, or in isolation from, measures prepared in accordance with GAAP. Additionally, in the case of stock-based compensation expense, if Box did not pay a portion of compensation in the form of stock-based compensation expense, the cash salary expense included in cost of revenue and operating expenses would be higher, which would affect Box’s cash position. The accompanying tables have more details on the reconciliations of non-GAAP financial measures and certain key metrics to their nearest comparable GAAP financial measures.

Non-GAAP gross profit and non-GAAP gross margin. Box defines non-GAAP gross profit as GAAP gross profit excluding expenses related to stock-based compensation (“SBC”) included in cost of revenue, intangible assets amortization, and as applicable, other special items. Non-GAAP gross margin is defined as non-GAAP gross profit divided by revenue. Although SBC is an important aspect of the compensation of Box’s employees and executives, determining the fair value of certain of the stock-based instruments Box utilizes estimation and the expense recorded may bear little resemblance to the actual value realized upon the vesting or future exercise of the related stock-based awards. Management believes it is useful to exclude SBC in order to better understand the long-term performance of Box’s core business and to facilitate comparison of Box’s results to those of peer companies. Management also views amortization of acquired intangible assets, such as the amortization of the cost associated with an acquired company’s developed technology and trade names, as items arising from pre-acquisition activities determined at the time of an acquisition. While these intangible assets are continually evaluated for impairment, amortization of the cost of purchased intangibles is a static expense that is not typically affected by operations during any particular period. Box also excludes expenses associated with a non-recurring workforce reorganization from non-GAAP gross profit as they are considered by management to be special items outside of Box’s core operating results.

Non-GAAP operating income and non-GAAP operating margin. Box defines non-GAAP operating income as operating income excluding expenses related to SBC, intangible assets amortization, and as applicable, other special items. Non-GAAP operating margin is defined as non-GAAP operating income divided by revenue. Box excludes the following expenses as they are considered by management to be special items outside of Box’s core operating results: (1) fees related to shareholder activism (2) expenses related to certain litigation, (3) expenses associated with a non-recurring workforce reorganization, consisting primarily of severance and other personnel-related costs, and (4) expenses related to acquisitions.

Non-GAAP net income attributable to common stockholders and non-GAAP net income per share attributable to common stockholders. Box defines non-GAAP net income attributable to common stockholders as GAAP net income attributable to common stockholders excluding expenses related to SBC, intangible assets amortization, amortization of debt issuance costs, the income tax benefit from the release of a valuation allowance on deferred tax assets, induced conversion of convertible notes, undistributed earnings attributable to preferred stockholders, and as applicable, other special items as described in the preceding paragraph. Box defines non-GAAP net income per share attributable to common stockholders as non-GAAP net income attributable to common stockholders divided by the weighted-average outstanding shares.

Billings. Billings reflect, in any particular period, (1) sales to new customers, plus (2) subscription renewals and (3) expansion within existing customers, and represent amounts invoiced for all products and professional services. Box calculates billings for a period by adding changes in deferred revenue and contract assets in that period to revenue. Box believes that billings help investors better understand sales activity for a particular period, which is not necessarily reflected in revenue as a result of the fact that Box recognizes subscription revenue ratably over the subscription term. Box considers billings a significant performance measure. Box monitors billings to manage the business, make planning decisions, evaluate performance and allocate resources. Box believes that billings offers valuable supplemental information regarding the performance of the business and helps investors better understand the sales volumes and performance of the business. Although Box considers billings to be a significant performance measure, Box does not consider it to be a non-GAAP financial measure because it is calculated using exclusively revenue, deferred revenue, and contract assets, all of which are financial measures calculated in accordance with GAAP.

Remaining performance obligations. Remaining performance obligations (“RPO”) represent, at a point in time, contracted revenue that has not yet been recognized. RPO consists of deferred revenue and backlog. Backlog is defined as non-cancellable contracts deemed certain to be invoiced and recognized as revenue in future periods. Future invoicing is determined to be certain when we have an executed non-cancellable contract or a significant penalty that is due upon cancellation. While Box believes RPO is a leading indicator of revenue as it represents sales activity not yet recognized in revenue, it is not necessarily indicative of future revenue growth as it is influenced by several factors, including seasonality, contract renewal timing, average contract terms and foreign currency exchange rates. Box monitors RPO to manage the business and evaluate performance. Box considers RPO to be a significant performance measure. Box does not consider RPO to be a non-GAAP financial measure because it is calculated in accordance with GAAP, specifically under ASC Topic 606.

Non-GAAP free cash flow and free cash flow margin. Box defines non-GAAP free cash flow as cash flows from operating activities less purchases of property and equipment, principal payments of finance lease liabilities, capitalized internal-use software costs, and other items that did not or are not expected to require cash settlement and that management considers to be outside of Box’s core business. Free cash flow margin is calculated as non-GAAP free cash flow divided by revenue. Box specifically identifies adjusting items in the reconciliation of GAAP to non-GAAP financial measures. Box considers non-GAAP free cash flow to be a profitability and liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that can possibly be used for investing in Box's business and strengthening its balance sheet, but it is not intended to represent the residual cash flow available for discretionary expenditures. The presentation of non-GAAP free cash flow is also not meant to be considered in isolation or as an alternative to cash flows from operating activities as a measure of liquidity.

About Box

Box (NYSE:BOX) is the leading Intelligent Content Management provider, a single platform that enables organizations to fuel collaboration, manage the entire content lifecycle, secure critical content, and transform business workflows with enterprise AI. Founded in 2005, Box simplifies work for leading global organizations, including AstraZeneca, JLL, Morgan Stanley, and Nationwide. Box is headquartered in Redwood City, CA, with offices across the United States, Europe, and Asia. Visit box.com to learn more. And visit box.org to learn more about how Box empowers nonprofits to fulfill their missions.

BOX, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands)

(Unaudited)

 

 

 

October 31,

 

January 31,

 

 

2024

 

2024

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

608,765

 

 

$

383,742

 

Short-term investments

 

 

89,150

 

 

 

96,948

 

Accounts receivable, net

 

 

188,495

 

 

 

281,487

 

Deferred commissions

 

 

43,192

 

 

 

45,817

 

Other current assets

 

 

32,988

 

 

 

34,186

 

Total current assets

 

 

962,590

 

 

 

842,180

 

Operating lease right-of-use assets, net

 

 

83,283

 

 

 

99,354

 

Goodwill

 

 

78,733

 

 

 

76,750

 

Deferred commissions, non-current

 

 

57,470

 

 

 

63,541

 

Deferred tax assets

 

 

72,352

 

 

 

75,665

 

Other long-term assets

 

 

99,892

 

 

 

83,673

 

Total assets

 

$

1,354,320

 

 

$

1,241,163

 

LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable, accrued expenses and other current liabilities

 

$

53,416

 

 

$

52,737

 

Accrued compensation and benefits

 

 

32,629

 

 

 

36,872

 

Operating lease liabilities

 

 

25,590

 

 

 

26,812

 

Deferred revenue

 

 

475,469

 

 

 

562,859

 

Total current liabilities

 

 

587,104

 

 

 

679,280

 

Debt, net, non-current

 

 

651,675

 

 

 

370,822

 

Operating lease liabilities, non-current

 

 

75,992

 

 

 

94,165

 

Other liabilities, non-current

 

 

25,754

 

 

 

35,863

 

Total liabilities

 

 

1,340,525

 

 

 

1,180,130

 

Series A convertible preferred stock

 

 

493,677

 

 

 

492,095

 

Stockholders’ deficit:

 

 

 

 

 

 

Common stock

 

 

14

 

 

 

14

 

Additional paid-in capital

 

 

686,216

 

 

 

785,374

 

Accumulated other comprehensive loss

 

 

(9,959

)

 

 

(9,686

)

Accumulated deficit

 

 

(1,156,153

)

 

 

(1,206,764

)

Total stockholders’ deficit

 

 

(479,882

)

 

 

(431,062

)

Total liabilities, convertible preferred stock and stockholders’ deficit

 

$

1,354,320

 

 

$

1,241,163

 

BOX, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Thousands, Except Per Share Data)

(Unaudited)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

October 31,

 

October 31,

 

 

2024

 

2023

 

2024

 

2023

Revenue

 

$

275,913

 

 

$

261,537

 

 

$

810,610

 

 

$

774,863

 

Cost of revenue (1)

 

 

55,556

 

 

 

69,227

 

 

 

169,321

 

 

 

197,891

 

Gross profit

 

 

220,357

 

 

 

192,310

 

 

 

641,289

 

 

 

576,972

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Research and development (1)

 

 

67,865

 

 

 

61,026

 

 

 

195,983

 

 

 

186,860

 

Sales and marketing (1)

 

 

95,407

 

 

 

87,930

 

 

 

283,315

 

 

 

262,745

 

General and administrative (1)

 

 

33,674

 

 

 

31,975

 

 

 

100,293

 

 

 

97,778

 

Total operating expenses

 

 

196,946

 

 

 

180,931

 

 

 

579,591

 

 

 

547,383

 

Income from operations

 

 

23,411

 

 

 

11,379

 

 

 

61,698

 

 

 

29,589

 

Interest and other (expense) income, net

 

 

(6,119

)

 

 

1,801

 

 

 

2,438

 

 

 

7,412

 

Income before provision for income taxes

 

 

17,292

 

 

 

13,180

 

 

 

64,136

 

 

 

37,001

 

Provision for income taxes

 

 

4,399

 

 

 

2,524

 

 

 

13,525

 

 

 

7,204

 

Net income

 

$

12,893

 

 

$

10,656

 

 

$

50,611

 

 

$

29,797

 

Accretion and dividend on series A convertible preferred stock

 

 

(4,282

)

 

 

(4,280

)

 

 

(12,832

)

 

 

(12,811

)

Undistributed earnings attributable to preferred stockholders

 

 

(985

)

 

 

(729

)

 

 

(4,302

)

 

 

(1,938

)

Net income attributable to common stockholders

 

$

7,626

 

 

$

5,647

 

 

$

33,477

 

 

$

15,048

 

Net income per share attributable to common stockholders

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.05

 

 

$

0.04

 

 

$

0.23

 

 

$

0.10

 

Diluted

 

$

0.05

 

 

$

0.04

 

 

$

0.23

 

 

$

0.10

 

Weighted-average shares used to compute net income per share attributable to common stockholders

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

143,479

 

 

 

143,915

 

 

 

144,275

 

 

 

144,296

 

Diluted

 

 

149,071

 

 

 

147,625

 

 

 

148,002

 

 

 

149,351

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Includes stock-based compensation expense as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

October 31,

 

October 31,

 

 

2024

 

2023

 

2024

 

2023

Cost of revenue

 

$

4,640

 

 

$

4,973

 

 

$

13,992

 

 

$

14,688

 

Research and development

 

 

19,925

 

 

 

17,731

 

 

 

57,420

 

 

 

53,455

 

Sales and marketing

 

 

19,635

 

 

 

16,810

 

 

 

56,591

 

 

 

49,674

 

General and administrative

 

 

11,384

 

 

 

11,380

 

 

 

33,854

 

 

 

33,700

 

Total stock-based compensation

 

$

55,584

 

 

$

50,894

 

 

$

161,857

 

 

$

151,517

 

BOX, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Thousands)

(Unaudited)

 

 

Three Months Ended

Nine Months Ended

 

October 31,

October 31,

 

2024

2023

2024

2023

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

Net income

$

12,893

 

$

10,656

 

$

50,611

 

$

29,797

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

5,926

 

 

14,513

 

 

15,910

 

 

38,996

 

Stock-based compensation expense

 

55,584

 

 

50,894

 

 

161,857

 

 

151,517

 

Amortization of deferred commissions

 

12,839

 

 

13,434

 

 

39,377

 

 

40,803

 

Induced conversion expense

 

10,139

 

 

—

 

 

10,139

 

 

—

 

Other

 

(4,898

)

 

1,024

 

 

(2,496

)

 

2,729

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable, net

 

(12,537

)

 

(3,029

)

 

90,764

 

 

93,280

 

Deferred commissions

 

(11,572

)

 

(11,042

)

 

(30,860

)

 

(28,361

)

Operating lease right-of-use assets, net

 

4,821

 

 

10,452

 

 

18,171

 

 

26,302

 

Other assets

 

569

 

 

1,934

 

 

(26

)

 

707

 

Accounts payable, accrued expenses and other liabilities

 

3,880

 

 

(3,002

)

 

(10,519

)

 

(9,138

)

Operating lease liabilities

 

(6,332

)

 

(11,545

)

 

(21,658

)

 

(35,731

)

Deferred revenue

 

(8,730

)

 

(2,507

)

 

(91,186

)

 

(81,513

)

Net cash provided by operating activities

 

62,582

 

 

71,782

 

 

230,084

 

 

229,388

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

Purchases of short-term investments

 

(34,221

)

 

(40,644

)

 

(90,676

)

 

(106,389

)

Maturities of short-term investments

 

21,500

 

 

29,000

 

 

97,396

 

 

79,000

 

Sales of short-term investments

 

—

 

 

—

 

 

3,567

 

 

—

 

Purchases of property and equipment

 

(271

)

 

(2,461

)

 

(1,945

)

 

(4,461

)

Proceeds from sales of property and equipment

 

2,404

 

 

418

 

 

8,395

 

 

1,671

 

Capitalized internal-use software costs

 

(7,354

)

 

(3,985

)

 

(19,031

)

 

(12,362

)

Other

 

(3,525

)

 

—

 

 

(3,525

)

 

(190

)

Net cash used in investing activities

 

(21,467

)

 

(17,672

)

 

(5,819

)

 

(42,731

)

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Proceeds from issuance of convertible notes, net of issuance costs

 

448,953

 

 

—

 

 

448,953

 

 

—

 

Partial repurchase of convertible notes

 

(191,713

)

 

—

 

 

(191,713

)

 

—

 

Purchase of capped calls related to convertible notes

 

(52,486

)

 

—

 

 

(52,486

)

 

—

 

Settlement of capped calls related to convertible notes

 

30,313

 

 

—

 

 

30,313

 

 

—

 

Repurchases of common stock

 

(29,965

)

 

(51,016

)

 

(168,651

)

 

(155,922

)

Principal payments on borrowings

 

(30,000

)

 

—

 

 

(30,000

)

 

—

 

Payments of dividends to preferred stockholders

 

(3,750

)

 

(3,750

)

 

(11,250

)

 

(11,193

)

Proceeds from exercise of stock options

 

817

 

 

362

 

 

16,170

 

 

1,157

 

Proceeds from issuances of common stock under employee stock purchase plan

 

10,233

 

 

10,815

 

 

25,910

 

 

26,860

 

Employee payroll taxes paid for net settlement of stock awards

 

(20,306

)

 

(16,272

)

 

(58,089

)

 

(58,298

)

Principal payments of finance lease liabilities

 

—

 

 

(7,179

)

 

(2,141

)

 

(26,131

)

Other

 

—

 

 

(419

)

 

(2,022

)

 

(3,989

)

Net cash provided by (used in) financing activities

 

162,096

 

 

(67,459

)

 

4,994

 

 

(227,516

)

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

 

(881

)

 

(4,874

)

 

(3,470

)

 

(9,710

)

Net increase (decrease) in cash, cash equivalents, and restricted cash

 

202,330

 

 

(18,223

)

 

225,789

 

 

(50,569

)

Cash, cash equivalents, and restricted cash, beginning of period

 

407,716

 

 

396,694

 

 

384,257

 

 

429,040

 

Cash, cash equivalents, and restricted cash, end of period

$

610,046

 

$

378,471

 

$

610,046

 

$

378,471

 

BOX, INC.

RECONCILIATION OF GAAP TO NON-GAAP DATA

(In Thousands, Except Per Share Data and Percentages)

(Unaudited)

 

 

Three Months Ended

Nine Months Ended

 

October 31,

October 31,

 

2024

2023

2024

 

2023

GAAP gross profit

$

220,357

 

$

192,310

 

$

641,289

 

$

576,972

 

Stock-based compensation

 

4,640

 

 

4,973

 

 

13,992

 

 

14,688

 

Acquired intangible assets amortization

 

1,073

 

 

1,452

 

 

3,206

 

 

4,356

 

Workforce reorganization

 

—

 

 

912

 

 

—

 

 

912

 

Non-GAAP gross profit

$

226,070

 

$

199,647

 

$

658,487

 

$

596,928

 

 

 

 

 

 

 

 

 

 

GAAP gross margin

 

79.9

%

 

73.5

%

 

79.1

%

 

74.5

%

Stock-based compensation

 

1.6

 

 

1.9

 

 

1.7

 

 

1.9

 

Acquired intangible assets amortization

 

0.4

 

 

0.6

 

 

0.4

 

 

0.5

 

Workforce reorganization

 

—

 

 

0.3

 

 

—

 

 

0.1

 

Non-GAAP gross margin

 

81.9

%

 

76.3

%

 

81.2

%

 

77.0

%

 

 

 

 

 

 

 

 

 

GAAP operating income

$

23,411

 

$

11,379

 

$

61,698

 

$

29,589

 

Stock-based compensation

 

55,584

 

 

50,894

 

 

161,857

 

 

151,517

 

Acquired intangible assets amortization

 

1,073

 

 

1,452

 

 

3,206

 

 

4,356

 

Acquisition-related expenses

 

50

 

 

—

 

 

343

 

 

14

 

Expenses related to litigation

 

72

 

 

(10

)

 

176

 

 

309

 

Workforce reorganization

 

—

 

 

912

 

 

—

 

 

912

 

Non-GAAP operating income

$

80,190

 

$

64,627

 

$

227,280

 

$

186,697

 

 

 

 

 

 

 

 

 

 

GAAP operating margin

 

8.5

%

 

4.4

%

 

7.6

%

 

3.8

%

Stock-based compensation

 

20.2

 

 

19.4

 

 

20.0

 

 

19.6

 

Acquired intangible assets amortization

 

0.4

 

 

0.6

 

 

0.4

 

 

0.6

 

Acquisition-related expenses

 

—

 

 

—

 

 

—

 

 

—

 

Expenses related to litigation

 

—

 

 

—

 

 

—

 

 

—

 

Workforce reorganization

 

—

 

 

0.3

 

 

—

 

 

0.1

 

Non-GAAP operating margin

 

29.1

%

 

24.7

%

 

28.0

%

 

24.1

%

 

 

 

 

 

 

 

 

 

GAAP net income attributable to common stockholders

$

7,626

 

$

5,647

 

$

33,477

 

$

15,048

 

Stock-based compensation

 

55,584

 

 

50,894

 

 

161,857

 

 

151,517

 

Acquired intangible assets amortization

 

1,073

 

 

1,452

 

 

3,206

 

 

4,356

 

Acquisition-related expenses

 

50

 

 

—

 

 

343

 

 

14

 

Expenses related to litigation

 

72

 

 

(10

)

 

176

 

 

309

 

Workforce reorganization

 

—

 

 

912

 

 

—

 

 

912

 

Amortization of debt issuance costs

 

651

 

 

475

 

 

1,604

 

 

1,423

 

Induced conversion expense

 

10,139

 

 

—

 

 

10,139

 

 

—

 

Undistributed earnings attributable to preferred stockholders

 

(7,733

)

 

(6,145

)

 

(20,192

)

 

(18,090

)

Non-GAAP net income attributable to common stockholders

$

67,462

 

$

53,225

 

$

190,610

 

$

155,489

 

 

 

 

 

 

 

 

 

 

GAAP net income per share attributable to common stockholders, diluted

$

0.05

 

$

0.04

 

$

0.23

 

$

0.10

 

Stock-based compensation

 

0.37

 

 

0.34

 

 

1.09

 

 

1.01

 

Acquired intangible assets amortization

 

0.01

 

 

0.01

 

 

0.02

 

 

0.03

 

Acquisition-related expenses

 

—

 

 

—

 

 

—

 

 

—

 

Expenses related to litigation

 

—

 

 

—

 

 

—

 

 

—

 

Workforce reorganization

 

—

 

 

0.01

 

 

—

 

 

0.01

 

Amortization of debt issuance costs

 

—

 

 

—

 

 

0.01

 

 

0.01

 

Induced conversion expense

 

0.07

 

 

—

 

 

0.07

 

 

—

 

Undistributed earnings attributable to preferred stockholders

 

(0.05

)

 

(0.04

)

 

(0.13

)

 

(0.12

)

Non-GAAP net income per share attributable to common stockholders, diluted

$

0.45

 

$

0.36

 

$

1.29

 

$

1.04

 

Weighted-average shares used to compute GAAP net income per share attributable to common stockholders, diluted

 

149,071

 

 

147,625

 

 

148,002

 

 

149,351

 

Weighted-average shares used to compute non-GAAP net income per share attributable to common stockholders, diluted

 

149,499

 

 

147,625

 

 

148,311

 

 

149,351

 

 

 

 

 

 

 

 

 

 

GAAP net cash provided by operating activities

$

62,582

 

$

71,782

 

$

230,084

 

$

229,388

 

Proceeds from sales of property and equipment, net of purchases

 

2,133

 

 

(2,043

)

 

6,450

 

 

(2,790

)

Principal payments of finance lease liabilities

 

—

 

 

(7,179

)

 

(2,141

)

 

(26,131

)

Capitalized internal-use software costs

 

(7,354

)

 

(4,243

)

 

(21,053

)

 

(13,334

)

Non-GAAP free cash flow

$

57,361

 

$

58,317

 

$

213,340

 

$

187,133

 

GAAP net cash used in investing activities

$

(21,467

)

$

(17,672

)

$

(5,819

)

$

(42,731

)

GAAP net cash provided by (used in) financing activities

$

162,096

 

$

(67,459

)

$

4,994

 

$

(227,516

)

BOX, INC.

RECONCILIATION OF GAAP REVENUE TO BILLINGS

(In Thousands)

(Unaudited)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

October 31,

 

October 31,

 

 

2024

 

2023

 

2024

 

2023

GAAP revenue

 

$

275,913

 

 

$

261,537

 

 

$

810,610

 

 

$

774,863

 

Deferred revenue, end of period

 

 

491,304

 

 

 

471,963

 

 

 

491,304

 

 

 

471,963

 

Less: deferred revenue, beginning of period

 

 

(502,104

)

 

 

(479,293

)

 

 

(586,871

)

 

 

(566,630

)

Contract assets, beginning of period

 

 

5,481

 

 

 

3,477

 

 

 

2,452

 

 

 

1,900

 

Less: contract assets, end of period

 

 

(5,909

)

 

 

(3,944

)

 

 

(5,909

)

 

 

(3,944

)

Billings

 

$

264,685

 

 

$

253,740

 

 

$

711,586

 

 

$

678,152

 

BOX, INC.

RECONCILIATION OF GAAP TO NON-GAAP NET INCOME PER SHARE GUIDANCE

(In Thousands, Except Per Share Data)

(Unaudited)

 

 

 

Three Months Ended

 

Fiscal Year Ended

 

 

January 31, 2025

 

January 31, 2025

GAAP net income per share attributable to common stockholders, diluted

 

$

0.07

 

 

$

0.30

 

Stock-based compensation

 

 

0.36

 

 

 

1.46

 

Acquired intangible asset amortization

 

 

0.01

 

 

 

0.03

 

Amortization of debt issuance costs

 

 

0.01

 

 

 

0.02

 

Other (1)

 

 

—

 

 

 

0.07

 

Undistributed earnings attributable to preferred stockholders

 

 

(0.04

)

 

 

(0.18

)

Non-GAAP net income per share attributable to common stockholders, diluted

 

$

0.41

 

 

$

1.70

 

 

 

 

 

 

 

 

Weighted-average shares, diluted

 

 

151,500

 

 

 

149,000

 

(1)

Other includes induced conversion expense, acquisition-related expenses, and expenses related to litigation.

BOX, INC.

RECONCILIATION OF GAAP TO NON-GAAP OPERATING MARGIN GUIDANCE

(Unaudited)

 

 

 

Three Months Ended

 

Fiscal Year Ended

 

 

January 31, 2025

 

January 31, 2025

GAAP operating margin

 

 

7.5

%

 

 

7.5

%

Stock-based compensation

 

 

19.5

 

 

 

20.0

 

Acquired intangible assets amortization

 

 

0.5

 

 

 

0.5

 

Non-GAAP operating margin

 

 

27.5

%

 

 

28.0

%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20241202375629/en/

Investors: Cynthia Hiponia and Elaine Gaudioso +1 650-209-3463 ir@box.com

Media: Kait Conetta and Sheridan Hoover press@box.com