Box 2026 Q3 Earnings Revenue Beats Guidance, AI-Driven Growth Drives Momentum

Box (BOX) reported fiscal Q3 2026 results on Dec 3, 2025, with revenue rising 9.1% to $301.11 million, exceeding guidance and analyst estimates. The company raised full-year revenue guidance to $1.175 billion, reflecting strong demand for its AI-powered content management platform. CEO Aaron Levie highlighted 28.6% operating margins and strategic AI integrations as key drivers of performance.

Revenue

Box’s total revenue grew 9.1% year-over-year to $301.11 million in Q3 2026, surpassing both guidance and Wall Street expectations. The increase was fueled by 12% billings growth and 18% year-over-year expansion in remaining performance obligations (RPO). Enterprise Advanced adoption and AI-driven workflow automation were central to this growth, with customers upgrading to leverage enhanced data governance and automation capabilities.

Earnings/Net Income

Box reported net income of $12.06 million in Q3 2026, a 6.4% decline from $12.89 million in the prior year. Earnings per share (EPS) remained stable at $0.05. While the EPS result aligned with expectations, the net income contraction reflects ongoing cost pressures and investment in AI and go-to-market initiatives. The EPS stability underscores disciplined cost management despite revenue growth.

Post-Earnings Price Action Review

The stock price of Box surged 10.13% on the day of the earnings release, with a 7.27% gain in the subsequent week. However, a 30-day trading strategy post-earnings underperformed historically, delivering a -15.33% total return over three years versus a 73.44% benchmark. The strategy’s -5.88% CAGR and -0.33 Sharpe ratio highlight its risk-averse nature, with minimal drawdowns but limited upside capture during market rallies. The 17.78% volatility suggests moderate risk exposure, though it failed to leverage broader market gains effectively.

CEO Commentary

CEO Aaron Levie emphasized Box’s Q3 performance, citing 9% revenue growth and 28.6% operating margins. He highlighted AI-powered upgrades like Box AI, Box Extract, and Box Automate as differentiators, enabling secure data governance and workflow automation. Levie cited customer examples, including a financial services firm streamlining workflows via AI-driven document extraction and a law firm expanding FedRAMP-compliant collaboration. Strategic partnerships with AWS and Tata Consultancy Services were also underscored as growth catalysts.

Guidance

Box raised full-year 2026 revenue guidance to $1.175 billion, with Q4 revenue projected at $304 million (9% YoY growth). Non-GAAP EPS for FY26 is expected at $1.28, with operating margins of ~28%. CFO Dylan Smith noted a $150 million increase in the share repurchase program and plans to settle convertible debt in January 2026. Billings growth for FY26 is projected at 9–10%, driven by FX tailwinds and AI-driven customer upgrades.

Additional News

Box expanded its partnership with AWS under a multi-year AI collaboration agreement, enhancing agentic AI capabilities on enterprise content. The company also announced a $150 million increase in its share repurchase program, reflecting confidence in long-term value. Raymond James lowered its price target to $38 from $42, maintaining an "Outperform" rating despite a 5% post-earnings stock decline. Analysts cited AI tailwinds and potential revenue acceleration as key positives, though mixed EPS results and valuation concerns tempered optimism.