Box revenues rise to $73m but losses deepen

Box sees growing revenues and rising losses

Box has reported a 43 percent hike in revenues to $73.5m for the second quarter of its 2016 financial year, but operating losses have risen to $32m.

Revenues were driven by a 45 percent increase in billings over the same quarter 12 months earlier.

Box reported that it has surpassed 50,000 paying customers globally, up by 3,000 compared with its first-quarter results. These Box customers now include Twitter, LinkedIn, Spotify and Airbnb.

However, Box’s operating losses rose from $29.4m to $32.7m, mostly owing to increased spending on sales and marketing to swell its customer base.

Box spent $58.4m on closing deals and promoting its products, a hike of $11m compared with the previous quarter.

Spending on research and development rose to $6m, up from $3m in its 2015 second quarter. This indicates that Box is interested in building out its cloud storage and collaboration tools along with adding new customers.

Aaron Levie, co-founder and chief executive of Box, noted how new customers have helped drive revenue growth, and hinted at the efforts Box is putting into developing its offerings.

“We continue to invest in our core platform while adding new products like Enterprise Key Management and Governance that augment our ability to capture demand in the broader enterprise content management market,” he said.

This level of spending contributed to Box’s overall net loss of $50m, significantly more than the $38m in the same quarter last year.

Nevertheless, the results surpassed analyst expectations, according to The Wall Street Journal, and Box’s share price rose three percent to $14.70 in after-hours trading.

Box, like others in the cloud product and service market, is going for growth over profits in the short term, which keeps shareholders happy and could reap rewards when the company consolidates its growth in the long term.

Box recently revealed a partnership with IBM to boost cloud storage and analytics, and its growth is not likely to slow down any time soon.

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10 September 2015 | 11:01 am – Source: v3.co.uk

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