Box Inc. rose in early trading after the cloud storage company reported a smaller first-quarter loss than analysts expected and boosted its revenue forecast for the year.
The shares rose as much as 14 percent to $20.35 before the markets opened Thursday. Through Wednesday, Box had jumped 27 percent since its Jan. 22 initial public offering.
Box, led by Aaron Levie, has been adding corporate features to lure more enterprise customers and last month said it signed an agreement with the U.S. Justice Department, its first agency-wide deal. Facing competition from rivals such as Microsoft Corp., Google Inc. and Dropbox Inc., the Los Altos, California-based company is trying to move away from basic file storage where prices are dropping.
“As far as we can tell, the numbers were pretty much greenlights across the board,” said Richard Davis Jr, an analyst at Canaccord Genuity Group Inc., who rates the shares a hold. “It’s a refreshing change from their first quarter” as a public company, he said.
Sales rose 45 percent to $65.6 million in the quarter ended April 30, and a loss, excluding certain items, of 28 cents a share, Box reported Wednesday after the markets closed. Analysts anticipated $63.7 million in revenue and a loss of 31 cents, on average. For the year, Box said sales would be as much as $290 million, up from its previous forecast and above the $283.3 million average prediction from analysts.
The results improve upon Box’s first quarterly report as a public company in March, when some analysts miscalculated the number of shares outstanding, leading to expectations for a narrower loss and sending shares down.
“This was as good quarter but they’ve got a lot more they have to do,” Davis said. “I want to see a black number on the bottom line.”
Billings, a measure of future revenue, rose 58 percent to $69.8 million, the company said. Box projected second-quarter sales of $69 million to $70 million compared with the $67.2 million average estimate of analysts.