Box shares tumble 24 pct as forecast hit by slowing billings growth

By Arjun Panchadar

Feb 27 (Reuters) - Cloud content management platform Box Inc's fourth-quarter revenue and current-quarter forecast missed Wall Street estimates, as the company was hurt by weaker-than-expected billings growth and sluggish customer additions, sending its shares down 24 percent.

Box's fourth-quarter billings - revenue plus the change in deferred revenue - rose 16 percent to $237.7 million, below the "mid 20s" growth rate that it had forecast in the third-quarter and well short of analysts' estimates of $255.5 million, according to IBES data from Refinitiv.

Box said the U.S. government shutdown delayed one of the seven-figure deals for the company.

It expects current-quarter billings growth to be in the low single-digit range, before returning to more normalized growth rates for the remainder of 2020.

"It's hard not to be disappointed by the results. Box is a company with good technology and impressive enterprise penetration, especially in the Fortune 500, but we appear to see extended sales execution issues" D.A. Davidson'sRishi Jaluria said.

Jaluria said he is worried the turnaround in sales and reacceleration of growth may take "significantly longer than the company or investors expected".

The company forecast current-quarter revenue in the range of $161 million to $162 million and adjusted loss of 6 cents to 5 cents per share. Analysts were expecting revenue of $169.7 million and a loss of 1 cent per share.

Box said it will see an $8 million headwind in 2020 as one of its customers reduced its spend with the company.

Shares of rival Dropbox fell 1 percent to $24.

Box's net loss narrowed to $19.7 million, or 14 cents per share, in the quarter ended Jan. 31, from $32.7 million, or 24 cents per share, a year earlier.

Excluding items, Box reported its first ever profit of 6 cents per share, above the average analyst estimate of 2 cents.

Revenue rose to $163.7 million from $136.7 million, missing estimates of $164.2 million.

Shares of the company, that have risen around 44 percent this year, fell to $18.90 in extended trading.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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