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Why Is Box (BOX) Down 1.9% Since Last Earnings Report?
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A month has gone by since the last earnings report for Box (BOX - Free Report) . Shares have lost about 1.9% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Box due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for Box, Inc. before we dive into how investors and analysts have reacted as of late.
BOX Q2 Earnings Meet Estimates, Revenue Beat on Enterprise Advanced
Box reported second-quarter fiscal 2027 non-GAAP earnings of 40 cents per share, up 21.2% year over year and in line with the Zacks Consensus Estimate.
Revenues of $321.1 million increased 9.2% year over year or 11% on a constant currency basis, and beat the consensus mark by 0.66%. Rapid Enterprise Advanced adoption supported the quarter, while net retention improved to 106% from 103% a year ago.
BOX's Q2 Customer Metrics Strengthen
Billings were $309.5 million, up 17% year over year on a reported basis and 16% in constant currency. Management highlighted that the outperformance versus its low-double-digit expectation was driven primarily by second-quarter booking strength, with the company recording record second-quarter bookings.
Suites customers accounted for 69% of revenues, up from 63% a year earlier. Customers paying at least $100,000 annually increased 10% year over year, while the annualized full churn rate remained at 3%. Suites momentum was a key revenue-growth driver.
Box's RPO Adds Revenue Visibility
Remaining performance obligations totaled $1.7 billion, up 15% year over year, or 17% in constant currency. Short-term RPO rose 11% to $904.7 million and increased 14% in constant currency. Long-term RPO climbed 18% to $787.0 million, or 22% in constant currency. Box expects to recognize roughly 55% of total RPO over the next 12 months.
Enterprise Advanced continued to support customer expansion. Management said retention within the Enterprise Advanced customer base exceeded the companywide rate, with higher seat expansion serving as the biggest driver of the broader retention improvement. AI unit consumption also grew rapidly from a lower base, with much of the activity coming from existing customers and leading to larger upsells.
BOX Expands Operating Profitability
The non-GAAP gross margin was 81.2%, down from 81.4% in the year-ago quarter. Non-GAAP gross profit rose to $260.7 million from $239.2 million. Management cited stronger adoption of Box Platform and Box AI, along with capacity constraints at public cloud providers, as key factors affecting gross-margin performance relative to earlier expectations.
Non-GAAP operating income reached $94.5 million compared with $84.0 million a year ago. The non-GAAP operating margin expanded 90 basis points to 29.4%, despite an approximately 100-basis-point foreign-exchange headwind. The result also exceeded management’s 28.5% margin guidance for the quarter.
Box's Cash Flow and Buybacks Remain Solid
As of July 31, 2026, cash and cash equivalents, restricted cash, and short-term investments were about $446 million, down from $479 million as of April 30, 2026.
Net cash provided by operating activities totaled $70.8 million, up 54% year over year. Non-GAAP free cash flow climbed 67% to $59.7 million.
The company repurchased about 2.6 million shares for roughly $66.4 million during the quarter and had approximately $378 million remaining under its current buyback authorization.
BOX Raises FY27 Revenue Outlook
For the third quarter of fiscal 2027, Box expects revenues of approximately $329 million, implying 9% year-over-year growth, or 11% in constant currency. Non-GAAP earnings are projected to be about 39 cents per share, while the non-GAAP operating margin is expected to be approximately 28%. Foreign exchange is expected to reduce revenue growth by about 170 basis points and earnings by roughly 2 cents per share.
For fiscal 2027, BOX raised its revenue outlook by $10 million to approximately $1.29 billion, representing 10% year-over-year growth, or 11% in constant currency. The company now expects non-GAAP earnings of about $1.54 per share and continues to target a non-GAAP operating margin of approximately 28%. Weighted-average diluted shares are expected to be about 141 million, down from 149 million in the prior year.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in fresh estimates.
VGM Scores
At this time, Box has a nice Growth Score of B, however its Momentum Score is doing a bit better with an A. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Box has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
View the Zacks #1 Rank List
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Why Is Box (BOX) Down 1.9% Since Last Earnings Report?
A month has gone by since the last earnings report for Box (BOX - Free Report) . Shares have lost about 1.9% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Box due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for Box, Inc. before we dive into how investors and analysts have reacted as of late.
BOX Q2 Earnings Meet Estimates, Revenue Beat on Enterprise Advanced
Box reported second-quarter fiscal 2027 non-GAAP earnings of 40 cents per share, up 21.2% year over year and in line with the Zacks Consensus Estimate.
Revenues of $321.1 million increased 9.2% year over year or 11% on a constant currency basis, and beat the consensus mark by 0.66%. Rapid Enterprise Advanced adoption supported the quarter, while net retention improved to 106% from 103% a year ago.
BOX's Q2 Customer Metrics Strengthen
Billings were $309.5 million, up 17% year over year on a reported basis and 16% in constant currency. Management highlighted that the outperformance versus its low-double-digit expectation was driven primarily by second-quarter booking strength, with the company recording record second-quarter bookings.
Suites customers accounted for 69% of revenues, up from 63% a year earlier. Customers paying at least $100,000 annually increased 10% year over year, while the annualized full churn rate remained at 3%. Suites momentum was a key revenue-growth driver.
Box's RPO Adds Revenue Visibility
Remaining performance obligations totaled $1.7 billion, up 15% year over year, or 17% in constant currency. Short-term RPO rose 11% to $904.7 million and increased 14% in constant currency. Long-term RPO climbed 18% to $787.0 million, or 22% in constant currency. Box expects to recognize roughly 55% of total RPO over the next 12 months.
Enterprise Advanced continued to support customer expansion. Management said retention within the Enterprise Advanced customer base exceeded the companywide rate, with higher seat expansion serving as the biggest driver of the broader retention improvement. AI unit consumption also grew rapidly from a lower base, with much of the activity coming from existing customers and leading to larger upsells.
BOX Expands Operating Profitability
The non-GAAP gross margin was 81.2%, down from 81.4% in the year-ago quarter. Non-GAAP gross profit rose to $260.7 million from $239.2 million. Management cited stronger adoption of Box Platform and Box AI, along with capacity constraints at public cloud providers, as key factors affecting gross-margin performance relative to earlier expectations.
Non-GAAP operating income reached $94.5 million compared with $84.0 million a year ago. The non-GAAP operating margin expanded 90 basis points to 29.4%, despite an approximately 100-basis-point foreign-exchange headwind. The result also exceeded management’s 28.5% margin guidance for the quarter.
Box's Cash Flow and Buybacks Remain Solid
As of July 31, 2026, cash and cash equivalents, restricted cash, and short-term investments were about $446 million, down from $479 million as of April 30, 2026.
Net cash provided by operating activities totaled $70.8 million, up 54% year over year. Non-GAAP free cash flow climbed 67% to $59.7 million.
The company repurchased about 2.6 million shares for roughly $66.4 million during the quarter and had approximately $378 million remaining under its current buyback authorization.
BOX Raises FY27 Revenue Outlook
For the third quarter of fiscal 2027, Box expects revenues of approximately $329 million, implying 9% year-over-year growth, or 11% in constant currency. Non-GAAP earnings are projected to be about 39 cents per share, while the non-GAAP operating margin is expected to be approximately 28%. Foreign exchange is expected to reduce revenue growth by about 170 basis points and earnings by roughly 2 cents per share.
For fiscal 2027, BOX raised its revenue outlook by $10 million to approximately $1.29 billion, representing 10% year-over-year growth, or 11% in constant currency. The company now expects non-GAAP earnings of about $1.54 per share and continues to target a non-GAAP operating margin of approximately 28%. Weighted-average diluted shares are expected to be about 141 million, down from 149 million in the prior year.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in fresh estimates.
VGM Scores
At this time, Box has a nice Growth Score of B, however its Momentum Score is doing a bit better with an A. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Box has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.