Box: Fiscal 3Q21 Financial Results
Fiscal year will probably end with revenue up 10% in box, and once more with losses, never stopping since 10 fiscal years.
This is a Press Release edited by StorageNewsletter.com on December 7, 2020 at 2:29 pm| (in $ million) | 3Q20 | 3Q21 | 9 mo. 20 | 9 mo. 21 |
| Revenue | 177.2 | 196.0 | 512.7 | 571.9 |
| Growth | 11% | 12% | ||
| Net income (loss) | (40.9) | (5.3) | (114.0) | (38.5) |
Box, Inc. announced financial results for the third quarter of fiscal year 2021, which ended October 31, 2020.
“Our cloud content management product suite continues to gain momentum as more enterprises prioritize digital transformation and building around best-of-breed applications,” said Aaron Levie, co-founder and CEO. “In the quarter, we closed strategic deals with leading organizations, including USAA, Murata Manufacturing and the US Air Force, and growing demand for products like Shield and Relay continue to accelerate adoption of our bundled Suite offerings.”
“Our 3FQ21 results demonstrate our ability to deliver strong profitable growth,” said Dylan Smith, co-founder and CFO. “Our focus on driving more efficient growth allowed us to improve operating margins and cash flow in 3FQ21. We now expect our non-GAAP operating margin for the full year to be at least 14% of revenue, a 1,300 basis point improvement from 1% a year ago.”
3FQ21 Highlights
• Revenue was $196.0 million, an increase of 11% from 3FQ20.
• Remaining performance obligations were $755.9 million, an increase of 19% from 3FQ20.
• Deferred revenue was $354.4 million, an increase of 9% from 3FQ20.
• Billings were $185.5 million, an increase of 8% from 3FQ20.
• GAAP gross profit was $139.2 million, or 71% of revenue, an improvement from GAAP gross profit of $120.9 million, or 68% of revenue in 3FQ20.
• Non-GAAP gross profit was $143.9 million, or 73% of revenue, an improvement from non-GAAP gross profit of $125.3 million, or 71% of revenue in 3FQ20
• GAAP operating loss was $2.6 million, or 1% of revenue. This compares to a GAAP operating loss of $39.2 million, or 22% of revenu, in 3FQ20.
• Non-GAAP operating income was $35.2 million, or 18% of revenue. This compares to a non-GAAP operating loss of $0.5 million, or 0% of revenue in 3FQ20.
• GAAP net loss per share, basic and diluted was $0.03 on 157.5 million weighted-average shares outstanding. This compares to a GAAP net loss per share of $0.28 in 3FQ20 on 148.6 million weighted-average shares outstanding.
• Non-GAAP net income per share, diluted was $0.20. This compares to a non-GAAP net loss per share of $0.01 in 3FQ20.
• Net cash provided by operating activities was $45.1 million, an increase of 407% from net cash provided by operating activities of $8.9 million in 3FQ20
• Free cash flow was positive $26.2 million. This compares to free cash flow of negative $1.7 million in 3FQ20
4FQ21 Guidance
Revenue is expected to be in the range of $196 million to $197 million. GAAP basic and diluted net loss per share are expected to be in the range of $0.08 to $0.06. Non-GAAP diluted net income per share is expected to be in the range of $0.16 to $0.18. Weighted-average basic and diluted shares outstanding are expected to be approximately 159 million and 165 million, respectively.
FY21 Guidance
Revenue is expected to be in the range of $768 million to $769 million. GAAP basic and diluted net loss per share are expected to be in the range of $0.32 to $0.30. Non-GAAP diluted net income per share is expected to be in the range of $0.64 to $0.66. Weighted-average basic and diluted shares outstanding are expected to be approximately 156 million and 162 million, respectively.
Comments
In this more recent quarter, Box delivered revenue of $196 million, up 11% Y/Y and only 2% Q/Q.
It never stops to grow in all fiscal year since 2011 but more and more modestly as the company is expanding, which is usual.
CEO Aaron Levie commented: "Last year we laid the foundation to improve our balance between growth and profitability for FY21 and beyond." But the resolution has to be proved.
The only quarter of profitability was 1FQ21 with $2.6 million and the company is back to losses since the last 2 quarters. Since 2011, Box didn't record any fiscal year of profitability and there are few chances that it will happen in FY21, maybe in FY22.
It ended 3FQ21 with RPO of $755.9million, up 19% Y/Y, driven by strong growth in backlog from longer-term strategic deals. It expects to recognize approximately 64% of its RPO over the next 12 months.
3FQ21 ended with an annualized net retention rate of 103%, down from 104% a year ago and 106% in 2FQ21. In the most recent 3-month period, full churn rate was 5% on an annualized basis, in line with the former quarter and an improvement from 6% in the year ago period.
3FQ21 billings came in at $185.5 million, representing 8% Y/Y growth, impacted by a greater pressure in professional services bookings than expected.
Growing demand for products like Box Shield and Box Relay drove more Suite adoption, including a 35% attach rate for Suite in 6-figure deals.
Over 100,000 customers now rely on Box to power secure collaboration and critical business processes.
In 3FQ21, Box closed 62 deals worth more than $100,000 vs. 64 a year ago, 7 deals over $500,000 in line with the year ago and 3 deals over $1 million, also in line with a year ago.
With over 1,500 integrations, the company continues to expand on its open and interoperable platform by creating a seamless experience for customers.
Sales and marketing expenses in the quarter were $56.5 million, representing 29% of revenue, down 1,300 basis points from 42% in the prior year. R&D expenses were $34.9 million or 18% of revenue, down 100 basis points from 19% one year ago. General and administrative costs were $17.3 million or 9% of revenue, down 100 basis points from 10% during the former year.
28% of revenue came from outside USA, up from 25% a year ago, with continued strength in Japan.
Box expects FY21 revenue to be in the range of $768 million to $769 million, representing 10% yearly growth.
FY revenue and losses for Box in $ million
| Period | Revenue | Y/Y growth | Net income (loss) |
| FY11 | 21.1 | NA | (53.3) |
| FY12 | NA | NA | NA |
| FY13 | 58.8 | NA | (112.6) |
| FY14 | 124.2 | 112% | (168.6) |
| FY15 | 216.4 | 74% | (168.2) |
| FY16 | 302.7 | 40% | (202.9) |
| FY17 | 398.6 | 32% | (150.8) |
| FY18 | 506.1 | 27% | (155.0) |
| FY19 | 608.4 | 20% | (134.6) |
| FY20 | 696.2 | 14% | (144.3) |
| 1FQ21 |
183.6 | 13% | 2.6 |
| 2FQ21 | 192.3 | 11% | (7.7) |
| 3FQ21 | 196.0 | 11% | (5.3) |
| 4FQ21* | 196-197 | 0-1% | NA |
| FY21* |
768-769 | 10% | NA |
* Estimations
Note: IPO in 2015 raising $175 million
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