Summary
Box started fiscal 2027 with stronger profitability. First-quarter revenue was $305.9 million, up 10.7% year over year. Gross profit was $243.2 million, up 12.8%, and gross margin was 79.5%, up 1.5 percentage points. Operating income was $27.4 million, up 333.0%, and operating margin was 9.0%, up 6.7 percentage points. Net income was $17.7 million, up 116.3%, and diluted EPS was $0.08, up $0.06. Operating cash flow was $140.2 million, up 10.3%. Capital expenditures were $1.3 million, up 309.3%. Deferred revenue was $605.9 million, up 5.5%. Remaining performance obligations were $1.6 billion, up 6.7%.
Billings were $255.4 million, up 5% year over year, or 13% on a constant currency basis. RPO growth was held back by foreign currency, with an unfavorable impact of approximately 470 basis points, while billings growth faced an approximately 790 basis point currency headwind. Net retention rate was 105%, compared with 102% a year earlier. Non-GAAP free cash flow was $127.7 million, up 8%, which is different from the $140.2 million of operating cash flow. The company repurchased 4.8 million shares for approximately $114 million and had approximately $445 million of buyback capacity remaining as of April 30, 2026.
Box continued to roll out AI and workflow products. The company announced general availability of Box Agent, an AI engine that can search and analyze files, and Box Automate, an agentic workflow tool. It also launched a new Box CLI, a Markdown Editor, and expanded MCP Apps to ChatGPT, Microsoft 365 Copilot, and Glean Assistant. Box added support for Anthropic's Claude Opus 4.7, Google's Gemini 3.5 Flash, and OpenAI's GPT-5.4 5.5 models, and announced a collaboration with NVIDIA Agent Toolkit. The company was named a Leader in the 2026 Gartner Magic Quadrant for Document Management. Customer wins and expansions included DLA Piper, Paul Weiss, Alnylam Pharmaceuticals, Penguin Random House, CBRE, the State of Hawaii, L'Oréal Canada, Williams Sonoma, BT Group, and NTT DOCOMO SOLUTIONS.
Guidance points to continued growth. For the second quarter of fiscal 2027, management guided for revenue growth of approximately 9% year over year, or 10% on a constant currency basis, with an expected foreign exchange headwind of approximately 170 basis points to revenue. Non-GAAP operating margin is expected to be approximately 28.5%, and non-GAAP diluted EPS is expected to be approximately $0.39. Both figures include expected foreign exchange headwinds, with approximately 100 basis points to operating margin and approximately $0.03 to EPS. For the full fiscal year 2027, management guided for revenue growth of approximately 9% year over year, or 10% on a constant currency basis, with an expected foreign exchange headwind of approximately 90 basis points to revenue. Non-GAAP operating margin is expected to be approximately 28%, and non-GAAP diluted EPS is expected to be approximately $1.56. The full-year figures include expected foreign exchange headwinds of approximately 70 basis points to operating margin and approximately $0.08 to EPS. Weighted-average diluted shares are expected to be approximately 139 million for both periods.
The outlook comes with risks. Macroeconomic conditions remain uncertain, including inflation, interest rates, tariffs, slower growth, a stronger dollar against foreign currencies, especially the Japanese Yen, government shutdowns, reduced U.S. federal spending, and ongoing conflicts in Russia-Ukraine and the Middle East. Box also faces customer churn, delayed sales cycles, and customers reducing budgets. Competition, pricing pressure, industry consolidation, and new competitors could affect results. The company depends on renewals and expansion, and a failure to renew or expand could hurt future revenue. Security vulnerabilities and integration of acquisitions are additional risks.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2027 | Q4 FY2026 | QoQ | Q1 FY2026 | YoY |
|---|---|---|---|---|---|
| Revenue | $305.9M | $305.9M | +0.0% | $276.3M | +10.7% |
| Gross profit | $243.2M | $245.0M | -0.7% | $215.6M | +12.8% |
| Gross margin | 79.5% | 80.1% | -0.6 pp | 78.0% | +1.4 pp |
| Research & development | $75.9M | $76.6M | -0.9% | $72.3M | +5.0% |
| Sales & marketing | $101.9M | $99.6M | +2.2% | $99.1M | +2.8% |
| General & administrative | $38.0M | $37.6M | +1.1% | $37.9M | +0.3% |
| Total operating expenses | $215.8M | $213.8M | +0.9% | $209.3M | +3.1% |
| Operating income (loss) | $27.4M | $31.2M | -12.1% | $6.3M | +333.0% |
| Operating margin | 9.0% | 10.2% | -1.2 pp | 2.3% | +6.7 pp |
| Net income (loss) | $17.7M | $81.7M | -78.3% | $8.2M | +116.3% |
| Net margin | 5.8% | 26.7% | -20.9 pp | 3.0% | +2.8 pp |
| Diluted EPS | $0.08 | $0.46 | -$0.38 | $0.02 | +$0.06 |
| Net retention rate | 105.0% | 104.0% | +1.0 pp | 102.0% | +3.0 pp |
Risks
Box warns that disruptive technologies such as generative AI may fundamentally alter the market for its services in unpredictable ways, and that competitors may incorporate AI capabilities more efficiently or achieve faster adoption. It also notes cost pressure from developing and deploying third-party AI systems that could impact margins.
As sales efforts increasingly focus on cloud content management use cases targeting enterprise and highly-regulated customers, Box expects longer and more expensive sales cycles, greater pricing pressure, and more demanding customization and integration requirements. This segment can require enterprise-wide decisions and heavier customer education on security, privacy and data protection.
Box states that adverse economic conditions have in the past and may in the future reduce sales, lengthen sales cycles, lower renewal rates and increase price competition. It specifically cites continued pressure from customers' lower headcount growth and greater budget scrutiny on IT decisions, along with inflation, tariffs, interest rate changes and geopolitical conflicts.
Box's net retention rate was approximately 105% and 102% as of April 30, 2026 and 2025, respectively, but the company notes the rate has fluctuated and may decline, and that it continues to be impacted by heightened budget scrutiny, pressure on seat expansion within existing customers, and increased partial customer churn.
Box faces larger competitors including Microsoft (SharePoint, OneDrive), OpenText (Documentum), Google (Drive) and Dropbox. Some competitors offer products at lower prices or for free as part of bundled or enterprise license arrangements, placing pricing pressure on Box and potentially reducing margins.
Box faces evolving AI regulation including the EU AI Act, a July 2025 U.S. federal AI policy roadmap, and AI-specific state bills in states such as Arkansas, California, Colorado, Illinois, Maryland, Montana, New York and Texas. The company notes these may increase the cost and complexity of developing and offering AI products.
Box sells to government entities and warns that public sector budgetary cycles, funding reductions or delays, an extended federal government shutdown, or efforts to reduce U.S. federal spending may limit or delay federal government spending on its solutions. Prior shutdowns have caused some federal customers to delay purchases.
Box had $460.0 million aggregate principal amount outstanding under its 2029 Convertible Notes as of April 30, 2026 and must settle principal in cash upon conversion. A stated inability to repurchase the notes on a fundamental change or pay cash at maturity would constitute a default and could cause a default under its senior credit facility.
Box warns that its growing use of AI technologies may create additional or heightened cybersecurity risks, and that AI technologies may be used in connection with cyberattacks. It also notes increased sophistication of social engineering techniques and heightened attack risk from nation-state actors due to geopolitical conflicts.
SaaS KPIs
All quarters →Billings
Net Retention Rate
Non-GAAP Operating Margin
Remaining Performance Obligations (RPO)
Non-GAAP Free Cash Flow
Long-term RPO
Short-term RPO
Summary, forecast, risks and KPIs are extracted from BOX INC's SEC filings for Q1 FY2027 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.