Box CFO: Growth Opportunities in Box Zones, International Business
Box expects that its expansion into new content management offerings, including Box Zones, and a widening footprint outside the U.S. will allow the company to continue growing its revenue, CFO Dylan Smith told attendees at the Baird Global Consumer, Technology & Services Conference in New York June 7.
After being a single-product company for its first decade, Box started rolling out additional new offerings after going public last year, he said. Those new products included, recently, Box Zones, giving its enterprise customers the choice to store data regionally across Asia and Europe, he said. Box Zones help businesses centralize critical content and enhance productivity, while addressing local data storage requirements, Box said in April. By leveraging Amazon Web Services and IBM Cloud, Box Zones allow content stored in Box to be stored in Germany, Ireland, Singapore and Japan, based on customer needs, Box said.
Customers outside the U.S. were “very concerned” with having their data stored in U.S. data centers, Jeetu Patel, Box SVP of platform and chief strategy officer, said at the conference. Box Zones allow companies to keep their data stored in multiple regions that company is located in, he said.
There are currently five Box Zones, one each in Germany, Ireland, Japan and Singapore, in addition to the U.S., Patel said. That will expand to “many more” zones over time, he said.
Box Zones joined services that included Box KeySafe and Box Governance as new ways that Box now provides customers with choice and flexibility in how they deploy Box data storage. Governance, introduced last year, allows users to control how they share content with people outside their companies, Patel said. KeySafe, introduced early this year, allows organizations to have independent control over their encryption keys.
There’s also a growth opportunity for Box in micro-services in which companies may use Box for one type of data solution but different companies for other data services, he said. “In the cloud world, in fact, there is actually no meaningful benefit to buy from a single provider,” he said.
In general, Box sees a “pretty big opportunity, not just here in the U.S., but internationally,” said Smith. International business now accounts for less than 20% of the company’s total revenue, he said. “With the release of Box Zones and the way that we’re building out our international efforts, we see a pretty big expansion opportunity out there as well,” he said. Box also sees a “pretty big opportunity to drive leverage and growth through our channel partners” which includes AT&T and IBM, he said.
Box now has a total of about 46 million users of its data offerings globally, including about 6.5 million paid subscribers, Patel said. There’s less than 3% churn among Box users, he said. The company added a record 5,000-plus new customers in the first quarter ended April 30, Smith said. There are more than 62,000 companies using Box globally, including 59% of Fortune 500 companies, he said, adding there’s “massive room to expand with our existing customers.”