Box (BOX) Q3 2025 earnings summary

Executive summary

• Q3 FY25 revenue grew 5% year-over-year to $275.9M–$276M, driven by strong demand for AI-driven solutions, high attach rates for Suites, and large customer growth, despite FX headwinds.

• Record non-GAAP gross margin of 81.9% (up 560 bps YoY) and non-GAAP operating margin of 29.1% (up 440 bps YoY); GAAP operating margin reached 8.5%.

• Net retention rate held steady at 102%, with churn rate at 3% and Suites now representing 59% of revenue.

• Major product launches included Box AI Studio, Box Apps, Box Forms, Box Doc Gen, Box Archive, and Box Hubs, expanding intelligent content management and workflow automation.

• Strategic partnerships deepened with AWS, Anthropic, OpenAI, Google, and system integrators, enhancing AI integration and market reach.

Financial highlights

• Q3 revenue: $275.9M–$276M (+5% YoY); billings: $264.7M (+4% YoY); RPO: $1.282B–$1.3B (+13% YoY).

• Free cash flow was $57M–$57.4M; cash and equivalents totaled $699M at quarter end.

• EPS: $0.45 non-GAAP (up $0.09 YoY), $0.05 GAAP; FY25 non-GAAP EPS guidance: $1.70.

• Large customers (>$100k ACV) grew 8% YoY to 1,900.

• S&M expense was 27% of revenue, R&D 17%, and G&A 8% in Q3 FY25.

Outlook and guidance

• Q4 FY25 revenue expected at ~$279M (+6% YoY, +7% constant currency); Q4 non-GAAP operating margin projected at 27.5%.

• FY25 revenue guidance is ~$1.09B (+5% YoY, +7% constant currency); billings growth rate expected at 4%.

• FY25 non-GAAP EPS raised to $1.70 (16% YoY increase); gross margin expected at 81%, operating margin at 28%.

• Guidance reflects FX and deferred tax expense impacts.