Sales Science’s Post

Box did something over the last 12 months that I've never seen They increased their Gross Margin by more than 6% from 73.5% to 79.9% in the last 12 months.   To put this in real terms in Q3 last year cost of rev was $69M this year it was just $55.5M despite doing 5% more revenue.   This helped them to drive a big increase in operating income. From $11M in Q3 last year to $23M this year. The problem for Box is the same problem that they've had for the last 7 quarters. Single digit ARR growth. This quarter was just 5%. You have to go back to Jan of 23 to find a quarter with ARR growth north of 10% They spent $95.2M on S&M in the quarter to generate jst $23M in net new ARR That gives them CAC Payback of 61 months Magic Number of 0.25 The story for box at the moment is a growth one. or lack thereof. Because of this they get just a 4X ARR Multiple

To view or add a comment, sign in

Explore topics