What happened
Shares of Box (NYSE: BOX) jumped 10% on Wednesday, following the release of the cloud-based data storage specialist's fiscal 2022 third-quarter results.
So what
Revenue rose 14% year over year to $224 million. Its deferred revenue, meanwhile, increased 21% to $429.7 million.
Better still, Box's billings -- a key metric that includes sales to new and existing customers, as well as subscription renewals -- jumped 25% to $231.5 million.
In a press release, CEO Aaron Levie said, "Our strong third-quarter results show the continued momentum of our long-term growth strategy, as more customers are turning to the Box Content Cloud to deliver secure content management and collaboration built for the new way of working."
Image source: Getty Images.
Moreover, Box's profitability is improving as it scales up its operations. Its adjusted gross and operating margins rose to 75% and 21%, respectively, up from 73% and 18% in the prior-year quarter.
In turn, adjusted earnings per share (EPS) grew 10% to $0.22, while its free cash flow increased 19% to $31.2 million.
Now what
These strong results prompted Box to raise its fiscal 2022 full-year financial forecast. Management now expects:
- revenue to rise 13% to between $868 million and $870 million, up from a previous projection of $856 million to $860 million.
- adjusted operating margin of roughly 20%, up from 19.5%.
- adjusted EPS of $0.83 to $0.84, up from $0.79 to $0.81.
Notably, Box's new revenue guidance would represent an acceleration from the 11% growth it experienced in fiscal 2021. Additionally, the company's strengthening cash flow generation and cash-rich balance sheet are allowing it to reward its shareholders with a $200 million increase to its stock buyback program.
"The confluence of remote work, digital transformation, and cybersecurity challenges is causing enterprises to rethink how they work with their content," Levie said. "We believe Box's leadership in the Content Cloud market is driving the acceleration of our growth and the expansion of our customer footprint."
10 stocks we like better than Box
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Box wasn't one of them! That's right -- they think these 10 stocks are even better buys.
*Stock Advisor returns as of November 10, 2021
Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Box. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
