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BOX Q4 Earnings and Revenues Surpass Estimates, Rise Y/Y

Box, Inc. BOX reported fourth-quarter fiscal 2022 earnings per share of 24 cents, which surpassed the Zacks Consensus Estimate by 4.3%. The figure grew 9.1% both sequentially and year over year.

Total revenues were $233.4 million, beating the consensus mark by 2.3%. Also, the top line increased 17% year over year and 4.2% from the prior quarter.

The growing adoption of Box’s Content Cloud drove top-line growth.

The company closed 128 deals in the fiscal fourth quarter, up 6% year over year.

BOX saw a 65% attach rate of its suites due to the increasing demand for multi-product suite offerings. The company reported 83 multi-product suite sales in the reported quarter, increasing 51% year over year. Also, 35% of its revenues were generated from suites sales compared with 24% in the year-ago period.

Strength in customer expansion and retention drove the results. Box’s net retention rate was 111% at the fiscal fourth quarter, expanding 900 basis points (bps) from the prior-year quarter.

The remaining performance obligations for the reported quarter were $1.1 billion, which increased 19% on a year-over-year basis. This is driven by a higher volume of long-term strategic deals.

Box, Inc. Price, Consensus and EPS Surprise

Box, Inc. Price, Consensus and EPS Surprise
Box, Inc. Price, Consensus and EPS Surprise

Box, Inc. price-consensus-eps-surprise-chart | Box, Inc. Quote

Billings and Deferred Revenues

Billings were $337.9 million for the reported quarter, which improved 9% year over year.

Deferred revenues were $534.2 million in the fourth quarter, increasing 15% from the prior-year quarter.

Quarter in Detail

Box witnessed several wins and expansions with companies like 23andMe, Crispr Therapeutics, Fanatics, Japan Post Co., Ltd., Twilio, and United Parcel Service of America in the reported quarter.

The company made an enhanced Box for Microsoft Teams integration and an enhanced Box for Slack integration generally available. This aided the fourth-quarter results.

BOX made an enhancement to the Box Admin Console by introducing the latest monitoring and reporting tools to help customers protect important data and run their businesses securely.

The company’s introduction of enhanced capabilities, integrations and developer tools for its native e-signature product, Box Sign, also supported the quarterly results.

Operating Results

Non-GAAP gross profit for the fiscal fourth quarter was $175.2 million, up 20.4% year over year. As a percentage of revenues, the figure was 75%, expanding 190 bps from the prior-year quarter.

Box’s operating expenses of $168.8 million increased 17.6% year over year. As a percentage of revenues, the figure expanded 17 bps from the year-ago quarter to 72%.

On a non-GAAP basis, the company recorded an operating margin of 20.8%, which expanded 250 bps from the prior-year quarter.

Balance Sheet and Cash Flow

As of Jan 31, 2021, cash and cash equivalents were $416.3 million compared with $568.3 million as of Oct 31, 2021. BOX’s short-term investments amounted to $170 million compared with $140 million in the previous quarter.

Accounts receivables amounted to $256.3 million at the fiscal fourth-quarter end, which increased from $154.6 million at the prior-quarter end.

Box generated $49.2 million of cash from operations in the reported quarter, up from $46.1 million in the previous quarter. Additionally, the company generated a free cash flow of $33.3 million in the fiscal fourth quarter.

In the fourth quarter, Box repurchased 5.5 million shares for approximately $140 million.

Guidance

For first-quarter fiscal 2023, Box expects revenues between $233 million and $235 million, suggesting a 16% year-over-year rise at the high-end. The Zacks Consensus Estimate for the same is pegged at $231.4 million.

On a non-GAAP basis, the company projects earnings per share of 24-25 cents. The Zacks Consensus Estimate for the same is pegged at 24 cents.

For fiscal 2023, Box anticipates revenues between $990 million and $996 million, indicating a year-over-year increase of 14% at the high-end. The Zacks Consensus Estimate for the same is pegged at $976.3 million.

On a non-GAAP basis, the company projects earnings per share of $1.10-$1.14. The consensus mark for the same is pegged at $1.09 per share.

Zacks Rank & Other Stocks to Consider

Box currently carries a Zacks Rank #2 (Buy).

Investors interested in the broader technology sector can consider some other top-ranked stocks like Allied Motion Technologies AMOT, Apple AAPL and inTest INTT. While Allied Motion currently sports a Zacks Rank #1 (Strong Buy), Apple and inTest carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Allied Motion is slated to report fourth-quarter 2021 results on Mar 9. It has gained 10.2% over a year. The long-term earnings growth rate for AMOT is currently projected at 10%.

Apple is scheduled to release second-quarter fiscal 2022 results on Apr 27. It has gained 36.4% over a year. The long-term earnings growth rate for AAPL is currently projected at 12.5%.

inTest is slated to report fourth-quarter 2021 results on Mar 4. It has gained 24.9% over a year. The long-term earnings growth rate for INTT is currently projected at 10%.


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