Box vs Dropbox: Enterprise vs Small Business Cloud Strategy, Execution
The latest evidence includes:
1. Box Financial Results: The company today revealed weaker-than-expected revenues, and a reduced revenue forecast for 2019. The cloud storage company’s stock fell more than 2o percent in after-hours trading. Quarterly profits were better than expected, but Box CEO Aaron Levie blamed a small revenue miss on multiple seven-figure customer contracts that got delayed coupled with weakness in EMEA (Europe, Middle East, Africa).
2. Dropbox Financial Results and Assertions: The company is winning against Box in the small and midsize (SMB) market, a Dropbox executive told CNBC last week after Dropbox delivered strong fourth quarter results. Box’s response: Levie says it’s not unreasonable to think that Dropbox is winning in SMB since Box focuses on the enterprise, CNBC reported today.
Box Business Reality Check
To be clear, Box isn’t imploding. The company’s fourth-quarter revenue was $163.7 million, up 20 percent year-over-year, the company revealed today. Plenty of tech companies crave that type of growth. But the revenue figure was about $470,000 short of Wall Street’s expectations. Pair that with a weaker-than-expected forecast for the rest of the year, and Box shares plummeted more than 20 percent in recent hours.
Still, Box is making progress on multiple business fronts. Among the milestones to note:
- Customers: Box’s paying customer base spans more than 92,000 organizations.
- Integrations: Announced the general availability of the Box for G Suite Integration. Other recent integrations involve ServiceNow and VMware.
- Partners: Announced the general availability of Box Skills Kit, enabling enterprise customers, third party developers, and system integrators to build custom AI integrations with Box, the company says.
Dropbox Business Reality Check
Dropbox, meanwhile, has quietly built an SMB-focused partner program. And the company is larger and growing faster than Box. Indeed, fourth quarter revenue was $375.9 million, up 23 percent year-over-year, according to a February 18 announcement.
During an earnings call, Dropbox CEO Drew Houston pointed to growing relationships with Microsoft, Google, Salesforce, Adobe, and Zoom. The company is also moving into workflow management with Dropbox Extensions. Customers have started using the extensions to sign, edit, annotate and fax business critical documents, and the company is starting to curate our next set of categories and partners for new extensions, Houston says.
Both Axcient and Datto promote file sync and sharing tools to MSPs. The offerings are well-regarded and purpose-built for partners. But neither offering has achieved the scale or momentum witnessed by Box and Dropbox.