Box publishes first results since its long-awaited IPO in January
Box reported increasing losses in its first results as a public company but maintains it is on the path to profitability following its long-awaited Initial Public Offering (IPO) earlier this year.
Fourth quarter revenues increased 61 percent year-on-year to $62.4m (£41.56m), while income for the 2015 financial year jumped by 74 percent to $216.4m (£144.1m).
However the cloud firm is still not profitable, reporting increased quarterly losses of $45.8 million (£30.5m) and a yearly deficit of $166.6m (£110.6m) compared to $158.8m (£105.7m) during the previous financial year.
One of the main investor concerns about the company’s S-1 filing, a document that must be completed by all companies wishing to list publically in the US, revealed high expenditure on sales and marketing.
But such expenditure is vital for Box, whose business strategy involves luring in users with free storage before converting them into paid users, and it is worth pointing out that full-year losses are now just 73 percent of revenue compared to 103 percent in fiscal 2014, something which is making the company optimistic for the future.
“The opportunity to transform how people work has never been greater, with organisations demanding technology that helps employees be more mobile and collaborative, while keeping information secure,” said Aaron Levie, Box CEO. “Box’s solid fiscal 2015 results – with 74 percent revenue growth year over year – highlight our continued execution as we help our more than 45,000 customers transition to the cloud and strengthen our position as the secure platform of choice for enterprise content collaboration.”
Box was keen to point out that it has made a number of moves to strengthen its service over the past year in order to generate more revenue. These include the launch of Box Trust, the launch of Box Enterprise Key Management (EKM) for organisations in regulated industries and the acquisition of BYOD-focused firm Subspace earlier this month.
The company’s IPO was delayed several times and the long-running saga was keenly watched by the technology sector. The company was valued at £1.1bn at the time of the flotation and is confident it will eventually become a profitable business.
“We’re committed to managing the business to achieve profitability, and we have a strong balance sheet to fund this transition,” said Dylan Smith, Box CFO.
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