February 26, 2020 / 9:14 PM / a month ago

Box forecasts strong first-quarter revenue; shares up

(Reuters) - Box Inc forecast first-quarter revenue above Street estimates, betting on high demand for its online software products that allow companies to manage and store content, sending its shares up nearly 9% in extended trading.

FILE PHOTO: Online data storage provider Box Inc Co-Founder and CEO Aaron Levie (L) and Co-Founder and CFO Dylan Smith (2nd L) celebrate their company's IPO on the floor of the New York Stock Exchange January 23, 2015. REUTERS/Brendan McDermid

The company also beat fourth-quarter profit and revenue benefiting from its add-on services and as larger companies subscribed to its products.

“We are firing off on all cylinders on the profitability side and continue to drive a balance between growth and profitability,” Chief Executive Officer Aaron Levie told Reuters.

As companies move online to create, share and store files, cloud storage companies are vying for a major share of the software services market that is estimated to hit $116 billion this year according to a Gartner report. (gtnr.it/388gVaV)

The content management platform that went public in 2015 competes with tech heavyweights like Microsoft Corp’s OneDrive and Alphabet Inc’s Drive.

The company expects first-quarter revenue between $183 million and $184 million, above analysts’ estimates of $181.8 million.

Revenue rose 12.1% to $183.6 million in the fourth quarter, above analysts’ estimate of $181.6 million, according to IBES data from Refinitiv.

However, net loss widened to $30.4 million, or 20 cents per share, in the fourth quarter ended Jan. 31, from $19.7 million, or 14 cents per share, a year earlier.

Total operating expenses in the quarter rose 12.5% to $155.4 million, with sales and marketing costs accounting for nearly half of the costs.

On an adjusted basis, Box reported a profit of 7 cents per share above estimates of 4 cents per share.

Reporting by Neha Malara in Bengaluru; Editing by Shailesh Kuber

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