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Box (BOX) is surging to record highs following a solid beat-and-raise 1Q26 earnings report, marking a significant improvement from last quarter's lackluster performance where the company narrowly beat EPS expectations and issued Q1 guidance well below consensus estimates. The upside Q1 EPS result was driven by strong demand for BOX’s AI-driven Intelligent Content Management solutions, improved operating margins of 25.3% (up from guidance of 25.0%), and disciplined cost management, which offset a challenging enterprise spending environment.

• Billings growth of 17% in constant currency and Remaining Performance Obligations (RPO) of $1.469 bln, also up 17% in constant currency, are critical metrics for BOX as they reflect future revenue potential and customer commitment to its cloud content management platform.
• Compared to recent quarters, the 17% billings growth in Q1 is a notable acceleration from Q4's 7% and Q3’s 3% growth, underscoring improving momentum driven by enterprise adoption of BOX’s premium suites. These metrics are key for BOX because they provide visibility into recurring revenue streams and customer retention, critical for a subscription-based SaaS business navigating competitive pressures in the enterprise software market.
• BOX’s growth is significantly catalyzed by the broader AI megatrend, particularly the need for enterprises to unlock value from unstructured data, which constitutes up to 80% of corporate data. BOX’s Intelligent Content Management platform, enhanced by AI integrations like Box AI and partnerships with Microsoft Azure OpenAI, enables businesses to analyze, classify, and derive actionable insights from vast datasets, driving efficiency and innovation. The platform’s ability to securely manage and process unstructured content—such as documents, images, and videos—positions BOX as a critical enabler for enterprises adopting generative AI and automation.
• The company's upbeat Q2 and FY26 guidance, which now calls for EPS of $1.22-$1.26 and revenue of $1.165-$1.170 bln compared to its prior outlook of $1.13-$1.17 and $1.155-$1.160 bln, is driven by sustained demand for AI-powered content management solutions, strong billings growth, and increasing adoption of high-margin suites, which are expected to drive operating margins to 28% for FY26. Management highlighted robust deal activity, including large enterprise contracts and renewals, alongside operational efficiencies from scaled AI deployments, as key factors supporting the raised guidance.

BOX’s Q1 performance and raised guidance reflect accelerating momentum fueled by AI-driven demand, robust billings, and RPO growth, positioning the company to capitalize on the enterprise need for unstructured data management. The strong adoption of its Intelligent Content Management platform and operational discipline signal improving growth prospects for BOX.