BOX Q1 Earnings & Revenues Surpass Estimates, Increase Y/Y
Box, Inc. BOX reported first-quarter fiscal 2025 non-GAAP earnings per share of 39 cents, which beat the Zacks Consensus Estimate by 8.3%. The figure jumped 21.9% year over year.
Total revenues of $264.66 million surpassed the consensus mark by 1.15%. The top line increased 5% year over year (8% growth on a constant-currency basis).
Solid momentum in the Content Cloud platform and the growing adoption of Enterprise Plus Suites drove top-line growth. The growing momentum of Box AI was also positive.
Q4 in Detail
Billings were $190.5 million for the reported quarter, decreasing 1% year over year (5% growth on a constant-currency basis).
Deferred revenues were $514 million in the fiscal first quarter, increasing 1% from the prior-year quarter (5% growth on a constant-currency basis).
BOX saw an 85% attach rate for its Suites, significantly up from 69% in the year-ago quarter.
Box’s net retention rate was 101% at the end of the fiscal first quarter, down 500 bps year over year due to macroeconomic challenges.
The remaining performance obligations as of Apr 30, 2024, were $1.212 billion, up 3% on a year-over-year basis (8% growth on a constant-currency basis).
Box, Inc. Price, Consensus and EPS Surprise
Box, Inc. price-consensus-eps-surprise-chart | Box, Inc. Quote
Operating Results
The non-GAAP gross margin was 80.2%, expanding 230 bps from the prior-year quarter.
Box’s operating expenses of $188.4 million increased 3.6% year over year. As a percentage of revenues, the figure contracted 100 bps from the year-ago quarter to 71.2%.
On a non-GAAP basis, the company recorded an operating margin of 26.6%, which expanded 380 bps from the prior-year quarter.
Balance Sheet & Cash Flow
As of Apr 30, 2024, cash and cash equivalents were $449.5 million, up from $383.7 million as of Jan 31, 2024.
BOX’s short-term investments amounted to $116.6 million, up from $96.9 million in the previous fiscal quarter.
Accounts receivables amounted to $143.05 million at the end of the fiscal first quarter, which decreased from $281.5 million at the end of the prior quarter.
Non-current debt was pegged at $371.3 million at the reported quarter’s end compared with $370.8 million at the previous quarter’s end.
Box generated $131.2 million in cash from operations in the fiscal first quarter, up from $89.3 million in the previous quarter.
BOX generated a free cash flow of $123.2 million in the reported quarter.
Guidance
For second-quarter fiscal 2025, Box expects revenues between $268 million and $270 million, suggesting a 3% rise at the high end of the range from the prior year’s reported figure. The constant-currency growth rate is pegged at 6%. The Zacks Consensus Estimate for the same is pinned at $270.7 million.
On a non-GAAP basis, BOX projects earnings per share of 40-41 cents. The guidance includes an expected foreign exchange headwind of 4 cents. The Zacks Consensus Estimate for the same is pegged at 39 cents.
The non-GAAP operating margin for the fiscal second quarter is expected to be 27%.
For fiscal 2025, the company revised its revenue guidance downward from $1.08-$1.085 billion to $1.075-$1.08 billion, indicating an increase of 4% from the prior year’s actual at the high end of the range. The constant-currency growth rate is pegged at 7%. The Zacks Consensus Estimate for the same is pinned at $1.08 billion.
BOX raised its guidance for non-GAAP earnings per share from $1.53-$1.57 to $1.54-$1.58. The guidance includes an expected foreign exchange headwind of 15 cents. The Zacks Consensus Estimate for the same is pegged at $1.57 per share.
The non-GAAP operating margin for the full fiscal year is expected to be 27%.
Zacks Rank & Stocks to Consider
Currently, Box carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader technology sector are Dell Technologies DELL, CrowdStrike CRWD and Intuit INTU, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Dell Technologies have gained 8.3% in the year-to-date period. The long-term earnings growth rate for DELL is expected to be 9.50%.
Shares of CrowdStrike have gained 32.8% in the year-to-date period. The long-term earnings growth rate for CRWD is projected at 22.31%.
Shares of Intuit have gained 4.8% in the year-to-date period. The long-term earnings growth rate for INTU is anticipated to be 14.57%.
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