Cloud content management company Box Inc. reported a larger third-quarter loss Wednesday thanks to higher spending on  marketing as it looks to sign up more customers in what is becoming an increasingly competitive business.

Box’s third-quarter results were largely in line with Wall Street’s estimates, but shareholders seemed less than impressed, with the company’s share price falling more than 5 percent in after-hours trading.

Box reported a loss after certain costs such as stock compensation of $17 million, or 13 cents per share. Total revenue for the quarter rose 26 percent year-over-year, however, coming in at $129.3 million. Wall Street was expecting a net loss of 13 cents per share on revenue of $128.64 million.

Box, which competes with Dropbox Inc. and similar services offered by software giants such as Google LLC and Microsoft Corp., said it invested heavily in the quarter to expand its sales and marketing teams in an effort to sign up more customers.

The firm spent almost $82 million on sales and marketing, a 22 percent increase from a year ago. Box said it increased its spending amid what it sees as soaring demand for cloud-based services from enterprises looking to take advantage of their reduced costs and greater flexibility.

“We’re seeing more and more adoption, in particular from Fortune 500 companies,” Box Chief Executive Officer Aaron Levie (pictured) said in a conference call.

Levie added that rising concerns over cybersecurity have benefited the firm’s strategy of giving its customers more control over their data by securing it. He said this was the company’s “core differentiator” and the main factor driving its growth.

Box’s increased marketing spend helped it to sign up around 4,000 new customers in the quarter, bringing its total to 80,000. However, the firm closed on fewer contracts this period than it did a year year ago.

Box also updated its guidance for the next quarter, saying it expects an adjusted loss of between 7 and 8 cents per share, on revenue of $136 million to $137 million. That’s more or less in line with Wall Street’s forecast $136.82 million revenue for the fourth quarter.

For the full year, Box reckons it will deliver a loss after certain costs of 44 to 45 cents per share, with total revenue between $505 million and $506 million.

Image: JD Lasica/Flickr