Box executives expect the company to see significant profit and revenue growth over the next few years, driven in part behind the strength of its products, including the one-two punch of its new Shield and Relay offerings, they said Oct. 3, during an investor breakout session that was webcast from the company’s BoxWorks conference in San Francisco.
This is a “pretty important moment in our organization,” according to CEO Aaron Levie, telling attendees that what they just saw at BoxWorks from the company was a “significant set of updates to our product strategy.”
Earlier in the day, Box announced plans with Adobe to deeply integrate a full-featured Acrobat web experience, including powerful capabilities to modify, organize, sign and collaborate on PDFs directly in Box. The new integration will seamlessly connect collaborative workflows for enterprises who rely on Box and Adobe, making it easier and more secure to work with digital documents in the cloud, Box said.
Box also announced a commitment at BoxWorks to build a new integration between the data platform of San Francisco tech company Splunk and Box Shield, Box’s new advanced set of content security controls and intelligent threat detection capabilities. Built natively into Box, Box Shield helps prevent data leakage, detects potential access misuse and proactively identifies threats, the company noted. Box provided a preview of Shield last year at BoxWorks, Levie noted during the investor meeting Oct. 3.
The company now has about 95,000 customers across multiple industries, including 69% of Fortune 500 companies, Levie said. That’s up from the more than 90,000 customers that the company said it had during a webinar last month.
Box is driving transformation across multiple industries, including non-profits and government agencies, and is helping companies drive down costs, shut down legacy systems and modernize their supply chains, Levie said.
“We’re seeing an incredible amount of traction in very regulated industries” like the financial and life sciences sectors, he said. Initially, it was only the non-regulated businesses that were adopting the cloud, but Box is now seeing “pronounced growth” among more regulated ones, which “plays directly into our strengths” and product roadmap, he said.
As the leader in cloud content management (CCM), Box is, meanwhile, “well-positioned” to capture the $45 billion-plus market for content and collaboration that’s seeing major disruption as more enterprise content management (ECM) workloads are moving to the cloud, he said. The opportunity for Box has never been larger, according to Levie.
The company’s top priorities are customer expansion, volume and velocity, and sales productivity, Mark Wayland, chief revenue officer, went on to tell attendees. Its target for fiscal 2021 is to grow customers by 106% by improving net retention, he said. It’s also targeting a 30% increase in $100,000 and higher deals, as well as a 15% increase in productivity during the same time frame, he noted.
“We’ve made substantial progress evolving our product and business capabilities over the past year,” according to CFO Dylan Smith. More profitable growth will be possible as Box leverages its market leadership position and enterprise customer base to accelerate CCM momentum, he said.
Box is targeting combined revenue growth and free cash flow margin improvement of 16% for fiscal 2020 (its current fiscal year), 25% or more next fiscal year, 30% or more in fiscal 2022 and 35% or more in fiscal 2023, he noted.