Slides
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Fourth Quarter and Fiscal FY25 Financial Results March 4, 2025
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This presentation contains forward-looking statements that involve risks, uncertainties, and assumptions, including statements regarding Box’s expectations regarding its growth and profitability, the size of its market opportunity, its investments in go-to-market programs, the demand for its products, the potential of AI and its impact on Box, the timing of recent and planned product introductions, enhancements and integrations, the short- and long-term success, market adoption and retention, capabilities, and benefits of such product introductions and enhancements, the success of strategic partnerships and acquisitions, the impact of macroeconomic conditions on its business, its ability to grow and scale its business and drive operating efficiencies, the impact of fluctuations in foreign currency exchange rates on its future results, its net retention rate, its ability to achieve revenue targets and billings expectations, its revenue and billings growth rates, its ability to expand operating margins, its long-term financial targets, its ability to achieve profitability on a quarterly or ongoing basis, its free cash flow, its ability to continue to grow unrecognized revenue and remaining performance obligations, its revenue, billings, GAAP and non -GAAP gross margins, GAAP and non-GAAP net income per share, GAAP and non-GAAP operating margins, the related components of GAAP and non-GAAP net income per share, weighted-average outstanding share count expectations for Box’s fiscal first quarter and full fiscal year 2026, equity burn rate, any potential repurchase of its common stock, whether, when, in what amount and by what method any such repurchase would be consummated, and the share price of any such repurchase. There are a significant number of factors that could cause actual results to differ materially from statements made in this presentation, including: (1) adverse changes in general economic or market conditions, including those caused by the Russia-Ukraine conflict and the conflict in the Middle East, inflation, and fluctuations in foreign currency exchange rates; (2) delays or reductions in information technology spending; (3) factors related to Box’s highly competitive market, including but not limited to pricing pressures, industry consolidation, entry of new competitors and new applications and marketing initiatives by Box’s current or future competitors; (4) the development of the cloud content management market; (5) the risk that Box’s customers do not renew their subscriptions, expand their use of Box’s services, or adopt new products offered by Box on a timely basis, or at all; (6) Box’s ability to provide timely and successful enhancements, integrations, new features and modifications to its platform and services; (7) actual or perceived security vulnerabilities in Box’s services or any breaches of Box’s security controls; (8) Box’s ability to realize the expected benefits of its third-party partnerships; and (9) Box’s ability to successfully integrate acquired businesses and achieve the expected benefits from those acquisitions. Further information on these and other factors that could affect the forward-looking statements we make in this presentation can be found in the documents that we file with or furnish to the US Securities and Exchange Commission, including Box's most recent Quarterly Report on Fo rm 10-Q filed for the fiscal quarter ended October 31, 2024. In addition, the preliminary financial results set forth in this presentation are estimates based on information currently available to Box. While Box believes these estimates are meaningful, they could differ from the actual amounts that Box ultimately reports in its Annual Report on Form 10-K for the fiscal year ended January 31, 2025. Box assumes no obligations and does not intend to update these estimates prior to filing its Form 10-K for the fiscal year ended January 31, 2025. You should not rely on any forward-looking statements, and Box assumes no obligation, nor do we intend, to update them. All info rmation in this presentation is as of March 4, 2025. This presentation contains non-GAAP financial measures and key metrics relating to the company's past and expected future performance. You can find the reconciliation of these measures to the nearest comparable GAAP financial measures in the appendix at the end of this presentation. The company has not reconciled certain of the non-GAAP measures in its long term operating model to their most directly comparable GAAP measure because certain adjustments cannot be predicted with a reasonable degree of certainty and the amount recognized can vary significantly. Accordingly, a reconciliation is not available without unreasonable efforts. Forward-looking statements & non-GAAP financial measures 2
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Revenue growth driven by Suites momentum Note: $ values are shown in millions. Box fiscal year ends January 31. $263 $265 $270 $276 $280 Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 3
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RPO supports enduring growth and revenue visibility Driven by strong contract durations partially offset by FX headwinds $1,305 $1,212 $1,272 $1,282 $1,466 $766 $716 $723 $737 $815 $539 $496 $549 $545 $651 Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 Total RPO up 12% YoY (up 14% in constant currency) Note: $ values are shown in millions. Remaining performance obligations (RPO) represent, at a point in time, contracted revenue that has not yet been recognized. RPO consists of deferred revenue and backlog, offset by contract assets. Box does not consider RPO to be a non-GAAP financial measure becauseit is calculated in accordance with GAAP. Long-Term RPO ($M) Short-Term RPO ($M) 4 +21% YoY +6% YoY
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Billings and deferred revenue Billings up 5%* YoY (up 7% in constant currency) Deferred revenue up 4%* YoY (as reported and in constant currency) Note: $ values are shown in millions. *Reconciliations of billings to revenue, deferred revenue, and contract assets calculated in accordance with GAAP can be foun d in the Appendix of this presentation. $379 $190 $256 $265 $399 Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 $587 $514 $502 $491 $609 Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 5
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Delivering leverage through gross margin expansion Optimizations from public cloud migration strategy drive leverage through reduced infrastructure costs Non-GAAP gross margin 78.4% 80.2% 81.6% 81.9% 81.0% Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 Note: A reconciliation of non-GAAP gross margin to the nearest GAAP financial measures can be found in the Appendix of this pres entation. Up 260 bps YoY 6
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Delivering operating margin improvements Operating discipline underpins year-over-year margin expansion Note: A reconciliation of non-GAAP operating margin to the nearest GAAP financial measures can be found in the Appendix of this presentation. Non-GAAP operating margin 26.7% 26.6% 28.4% 29.1% 27.3% Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 Up 60 bps YoY 7
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Cash, cash equivalents, restricted cash, and short-term investments Note: $ values are shown in millions. * ”Other” primarily consists of RSU taxes and payments of dividend to preferred stockholders. $ 699 $ 102 $ 42 $ 10 $ 25 $ 724 Q3'25 CFO Shares Repurchased Capitalized Software Other* Q4'25 8
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Share repurchase program • In Q4, the Company repurchased approximately 1.3 million shares of Box’s Class A common stock for approximately $43 million. • As of January 31, 2025, the Company had approximately $52 million of remaining Board- approved buyback capacity under the current plan. • In fiscal 2025, the Company repurchased approximately 7.6 million shares for approximately $212 million. • On March 3, 2025, the Board of Directors authorized an expansion of its stock repurchase program by $150 million. 9
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FY’25 33% 5% 81% 28% 17% 8% 28% Proven business model focused on driving growth and profitability FY’23 FY’24 Annual Revenue Growth + FCF Margin 37% 31% YoY Revenue Growth 13% 5% Gross Margin 77% 77% S&M as a % of Revenue 28% 27% R&D as a % of Revenue 18% 17% G&A as a % of Revenue 9% 8% Operating Margin 23% 25% Note: Gross Margin, S&M as a % of revenue, R&D as a % of revenue, G&A as a % of revenue, Operating Margin, and Free Cash Flow Ma rgin are non-GAAP financial measures. A reconciliation to their nearest GAAP financial measures can be found in the Appendix of this presentation. Q4’25 N/A 6% 81% 28% 17% 8% 27% 10 Q1’25 Q2’25 Q3’25 N/A N/A N/A 5% 3% 5% 80% 82% 82% 28% 28% 27% 17% 17% 17% 8% 8% 8% 27% 28% 29%
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Guidance and Outlook
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Q1 and fiscal year 2026 guidance Q1’26 Q1’26 (constant currency) Non-cash deferred income tax expense (1) Impact of Q1’25 Leap Year (2) FY26(4) Non-cash deferred income tax expense (1) Revenue $274 to $275 million -- -- 2.9 million $1.15 to $1.16 billion -- Year-over-Year growth +4% +5% at the high-end -- 120 bps +6% -- GAAP operating margin Approximately 4% Approximately 4.5% -- -- Approximately 7.5% -- Non-GAAP operating margin(3) Approximately 25% Approximately 25.4% -- 80 bps Approximately 28% -- GAAP EPS (diluted) 0¢ - 1¢ 1¢ - 2¢ 3¢ 2¢ 10¢ - 14¢ 19¢ Non-GAAP EPS (diluted) 25¢ - 26¢ 26¢ - 27¢ 12¢ 2¢ $1.13 - $1.17 56¢ Weighted-average shares, diluted Approximately 151 million -- -- -- Approximately 153 million -- 12 Note 1: As our business has become consistently profitable, we have released valuation allowances associated with certain def erred tax assets. Accordingly, in fiscal year 2026 we will be recognizing deferred tax expenses. This non -cash expense is reflected in our GAAP and non -GAAP diluted net income per share guidance for the first quarter of fiscal year 2026 and full fiscal year 2026. Within the impacts presented in this table, $0.11 and $0.51 represent the US deferred tax expenses for first quarter of fiscal year 2026 and full fiscal year 2026, respectively, with the remaining representing our foreign deferred tax expenses. Note 2: When comparing Q1’26 guidance to Q1’25, we are noting the impact of the leap year in FY25 which had one additional da y. Note 3: In Q1’25, non -GAAP operating margin benefited from a tailwind of 100 basis points from the sale of datacenter equipment in that quarter. Note 4: Our full year FY26 guidance assumes neutral impact from FX based on current exchange rates.
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Estimated Q1 and fiscal year 2026 preferred share impact summary Q1 FY26 FY26 Amortization of preferred share issuance costs $0.5M $2.1M Preferred stock dividend $3.7M $15.0M Undistributed earnings attributable to preferred shareholders $4.5M - $5.5M $23.5M - $24.5M The impact from the above items will appear below the net income line in our P&L, and in the Earnings Per Share Note accompanying Box’s financial statements. 13
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Delivering revenue growth at scale (1) Based on the Q1 and full year FY26 guidance provided on the Q4FY25 earnings call on March 4, 2025. Note: $ values are shown in millions $265 $270 $276 $280 $274-$275 Q1'25 Q2'25 Q3'25 Q4'25 Q1'26 Quarterly Revenue ($M) Q1 FY26 revenue guidance up 4% YoY1 (Up 5% YoY at the high end in constant currency) $874 $991 $1,038 $1,090 FY22 FY23 FY24 FY25 FY26 Annual Revenue ($M) FY26 revenue guidance up 6% YoY1 (Up 6% YoY in constant currency) $1,155-$1,160 14
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Key customer metrics
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Stable net retention rate Customer stickiness driveslow full churn rate of 3% 101% 101% 102% 102% 102% Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 Quarterly net retention rate 16 Note: Net retention rate is defined as the net percentage of Total Annual Recurring Revenue (Total ARR) retained from existing customers, including expansion. In calculating our net retention rate, we include only Total ARR associated with those customers who have subscribed to Box for at least 12 months. We calculate our net retention rate by dividing the current period total ARR of these customers by the prior period total ARR.
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Customers increasingly adopting Suites Suites support high value use cases and reduce cost and complexity 55% 56% 58% 59% 60% Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 % of total revenue from Suites 17
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Large customer growth demonstrates strength of business model Steady growth in customers paying more than $100k annually 1,770 1,800 1,850 1,900 1,920 Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 Customers >$100k in average contract value +8% YoY Note: Figures are rounded. Q3’25 number has been updated. 18
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Strong Suites attach rates Attach rates demonstrate platform’s enhanced strategic value 85 100 81% Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 Number of new Suites deals > $100k Suites attach rate Suites attach rate of 87%, up 600 bps YoY 87% 19
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Appendix
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GAAP Revenue to Billings Reconciliation ($ in thousands) Q4FY24 Q1FY25 Q2FY25 Q3FY25 Q4FY25 GAAP revenue $262,878 $264,658 $270,039 $275,913 $279,520 Deferred revenue, end of period 586,871 513,572 502,104 491,304 608,600 Less: Deferred revenue, beginning of period (471,963) (586,871) (513,572) (502,104) (491,304) Contract assets, beginning of period 3,944 2,452 3,345 5,481 5,909 Less: Contract assets, end of period (2,452) (3,345) (5,481) (5,909) (4,160) Billings $379,278 $190,466 $256,435 $264,685 $398,565 21
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GAAP to Non-GAAP Reconciliation – Gross Margin ($ in thousands) Q4FY24 As a % of revenue Q1FY25 As a % of revenue Q2FY25 As a % of revenue Q3FY25 As a % of revenue Q4FY25 As a % of revenue GAAP gross margin $200,157 76.1% $206,406 78.0% $214,526 79.4% $220,357 79.9% $220,736 79.0% Add: Stock-based compensation 4,423 4,621 4,731 4,640 4,664 Add: Acquired intangible assets amortization 1,482 1,152 981 1,073 1,008 Non-GAAP gross margin $206,062 78.4% $212,179 80.2% $220,238 81.6% $226,070 81.9% $226,408 81.0% ($ in thousands) FY23 As a % of revenue FY24 As a % of revenue FY25 As a % of revenue GAAP gross margin $738,318 75% $777,129 75% $862,025 79% Add: Stock-based compensation 17,816 19,111 18,656 Add: Acquired intangible assets amortization 5,808 5,838 4,214 Add: Workforce reorganization - 912 - Non-GAAP gross margin $761,942 77% $802,990 77% $884,895 81% 22
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GAAP to Non-GAAP Reconciliation — Operating Expenses ($ in thousands) Q1FY25 As a % of revenue Q2FY25 As a % of revenue Q3FY25 As a % of revenue Q4FY25 As a % of revenue GAAP research and development $65,673 24% $65,445 24% $67,865 25% $68,870 25% Less: Stock-based compensation (17,819) (19,676) (19,925) (20,137) Less: Acquisition-related expenses - (102) - Non-GAAP research and development $44,854 17% $45,667 17% $47,940 17% $48,733 17% GAAP sales and marketing $92,673 35% $95,235 35% $95,407 35% $96,839 35% Less: Stock-based compensation (17,783) (19,173) (19,635) (18,690) Non-GAAP sales and marketing $74,890 28% $76,062 28% $75,772 27% $78,149 28% GAAP general and administrative $33,053 12% $33,566 12% $33,674 12% $37,091 13% Less: Stock-based compensation (10,939) (11,531) (11,384) (13,655) Less: Acquisition-related expenses - (191) (50) (35) Less: Expenses related to litigation (79) (25) (72) (243) Non-GAAP general and administrative $22,035 8% $21,819 8% $22,168 8% $23,158 8% 23
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GAAP to Non-GAAP Reconciliation — Operating Expenses ($ in thousands) FY23 As a % of revenue FY24 As a % of revenue FY25 As a % of revenue GAAP research and development $243,529 25% $248,767 24% $264,853 24% Less: Stock-based compensation (68,900) (70,240) (77,557) Less: Acquisition-related expenses - - (102) Non-GAAP research and development $174,629 18% $178,527 17% $187,194 17% GAAP sales and marketing $331,400 33% $348,638 34% $380,154 35% Less: Stock-based compensation (58,448) (65,886) (75,281) Non-GAAP sales and marketing $272,952 28% $282,752 27% $304,873 28% GAAP general and administrative $126,549 13% $128,971 12% $137,384 13% Less: Stock-based compensation (40,468) (43,546) (47,509) Less: Acquisition-related expenses (53) (120) (276) Less: Fees related to shareholder activism 77 - - Less: Expenses related to litigation (722) (361) (419) Non-GAAP general and administrative $85,383 9% $84,944 8% $89,180 8% 24
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GAAP to Non-GAAP Reconciliation — Operating Margin ($ in thousands) Q4FY24 As a % of revenue Q1FY25 As a % of revenue Q2FY25 As a % of revenue Q3FY25 As a % of revenue Q4FY25 As a % of revenue GAAP operating margin $21,164 8.1% $18,007 6.8% $20,280 7.5% $23,411 8.5% $17,936 6.4% Add: Stock-based compensation 47,266 51,162 55,111 55,584 57,146 Add: Acquired intangible assets amortization 1,482 1,152 981 1,073 1,008 Add: Acquisition-related expenses 106 - 293 50 35 Add: Expenses related to litigation 52 79 25 72 243 Non-GAAP operating margin $70,070 26.7% $70,400 26.6% $76,690 28.4% $80,190 29.1% $76,368 27.3% ($ in thousands) FY23 As a % of revenue FY24 As a % of revenue FY25 As a % of revenue GAAP operating margin $36,840 4% $50,753 5% $79,634 7% Add: Stock-based compensation 185,632 198,783 219,003 Add: Acquired Intangible assets amortization 5,808 5,838 4,2414 Add: Acquisition-related expenses 53 120 378 Add: Fees related to shareholder activism (77) - - Add: Expenses related to litigation 722 361 419 Add: Workforce reorganization - 912 - Non-GAAP operating margin $228,978 23% $256,767 25% $303,648 28% 25
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GAAP to Non-GAAP Reconciliation — Free Cash Flow ($ in thousands) FY23 As a % of revenue FY24 As a % of revenue FY25 As a % of revenue GAAP net cash provided by operating activities $297,982 30% $318,727 31% $332,257 30% Less: Purchases of property and equipment (5,034) (4,703) (2,573) Add: Proceeds from sales of property and equipment 601 2,860 8,395 Less: Principal payments of finance lease liabilities (40,353) (30,176) (2,141) Less: Capitalized internal-use software costs (14,751) (17,742) (31,332) Free cash flow $238,445 24% $268,966 26% $304,606 28% 26
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GAAP to Non-GAAP Reconciliation — EPS Outlook Three Months Ended April 30, 2025 Fiscal Year Ended January 31, 2026 GAAP net income per share attributable to common stockholders, diluted $0.00 - $0.01 $0.10 - $0.14 Stock-based compensation 0.37 1.51 Acquired intangible assets amortization 0.01 0.03 Expenses related to litigation - 0.02 Amortization of debt issuance costs 0.01 0.02 Income tax effects of non-GAAP adjustments (1) (0.10) (0.42) Undistributed earnings attributable to preferred stockholders (0.03) (0.13) Non-GAAP net income per share attributable to common stockholders, diluted $0.25 - $0.26 $1.13 - $1.17 Weighted-average shares, diluted 151,000 153,000 27Note: Figures may not sum due to rounding. (1) As we have released valuation allowances associated with certain deferred tax assets, starting in fiscal year 2026 we wil l be presenting the income tax effects of non -GAAP adjustments.
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GAAP to Non-GAAP Reconciliation — Operating Margin Outlook Three Months Ended April 30, 2025 Fiscal Year Ended January 31, 2026 GAAP operating margin 4.0% 7.5% Add: Stock-based compensation 20.5% 20.0% Add: Acquired intangible assets amortization 0.5% 0.5% Non-GAAP operating margin 25.0% 28.0% 28