BOX

Box is executing the late-stage SaaS playbook competently: FY2026 revenue of $1.18B grew +8.0% YoY with a best-in-class 79.2% gross margin, and operating cash flow climbed to $356M (+7.3%) against just $6.07M of capex — a genuine cash machine. Management's MD&A reinforces the model: over 100,000 paying organizations on a subscription base recognized ratably, with ELAs and bundled add-ons (the 'a la carte' vs 'bundled plans' framing) driving expansion. The 'leading ICM provider' positioning over 'about 90% of all data' that is unstructured, plus 1,500+ integrations and an explicit AI push, is a real moat for regulated-content workflows.

The quality of the print is messier than the headline. Net income collapsed -52.8% to $115M and diluted EPS fell -57.4% to $0.58 — FY2025's $245M was lifted by tax benefits, so the comp is optically brutal but the underlying GAAP operating income only inched +4.5% to $83.2M on an unchanged 7.1% operating margin. R&D rose +11.2% (faster than revenue) as the company funds the AI agenda flagged in MD&A's forward-looking section, and D&A jumped +48.9%, both pressuring near-term GAAP earnings. Stockholders' equity is -$299M and retained earnings -$847M — a function of years of cumulative buybacks ($290M repurchased this year alone, +37.3%) against $451M long-term debt, not operational distress, but it does mean the balance sheet is engineered, not pristine. Cash fell -39.9% to $375M as buybacks outpaced FCF.