Shares in Box Inc. rose almost 9% in after-hours trading today after the company reported better-than-expected second-quarter financial results.

The cloud storage and file management company reported a profit before certain costs such as stock compensation of 18 cents per share on revenue of $192.3 million, up 11% from a year ago. Wall Street had forecast earnings of just 12 cents per share on revenue of $189.56 million.

Box said the company’s success was thanks to its focus on expanding and renewing deals with its existing customer base.

“Our focus is on growing existing accounts by driving add-on product options and seat expansions with Box Suites, as well as efficiently driving new logo acquisition in key markets,” Box Chief Executive Aaron Levie (pictured) said on a call with analysts.

Box said it had $364.9 million in deferred revenue as of July 31, up 10% from a year ago. Second quarter billings came to $188.8 million, an increase of 9%. It also reported free cash flow of $13.3 million.

“Box is well-positioned to support and profit from customers that shifted to work-from-home business models,” analyst Charles King of Pund-IT Inc told SiliconANGLE. “That translated into a solid quarter for the firm and it’s likely to deliver similar future results, so long as the Covid-19 crisis continues.”

The company said it secured new and expanded deals in the quarter with customers including Access Information Management, Apleona GmbH, Abbett & Co. LLC, San Diego Zoo Global and Sanki Engineering Co., Ltd. All together, Box now counts more than 100,000 customers on its platform, and Levie said there’s a lot of potential in this installed base.

“We have a significant installed base that still has in many cases limited penetration of Box,” Levie said.

Still, the company acknowledged that it didn’t close as many large deals as it hoped during the quarter. It said it had 64 deals valued at more than $100,000 compared with 68 a year ago. It closed on three deals valued more than $500,000 in the quarter, the same as a year ago. There were no deals over $1 million, versus two a year before.

But Box Chief Financial Officer Dylan Smith said the company had “seen an increase in the average contract values of those six-figure deals. In the second quarter that was up 10% year-over-year.”

Smith added that Box is also seeing stronger demand for six-figure enterprise deals, and that it expects to see solid growth in its large deal count in the next quarter.

Analyst Holger Mueller of Constellation Research Inc. told SiliconANGLE that Box’s 11% revenue growth was not too shabby, but said the company could probably have done better than this considering how many millions of knowledge workers have shifted to working from home in recent months.

“With the underlying infrastructure vendors growing revenue in their twenties, Levie and his team must ask themselves which growth streams they need to tap into,” Mueller said.

Box was busy on the product front in the quarter, adding new features to its existing tools to drive more and bigger deals with customers. The company made significant updates to its Box Relay workflow automation tools and announced new integrations with Google LLC’s G Suite, for example.

“It’s good to see Box releasing more products and capabilities, as these should equate into revenue growth,” Mueller said.

“Box took advantage of businesses, schools and governments needing to increase their secure cloud footprints outside of the corporate firewall,” said Patrick Moorhead of Moor Insights & Strategy. “At the same time, it has amped up partnerships with popular SaaS providers like G Suite and Webex and rose as they rose. I like Box’s increased secure offerings as well as its no-code offerings to tie disparate services together for workflow.”

King told SiliconANGLE it was a wise move by Box to focus on refining its existing services because it gives clients good reasons to stick around.

“But if growing its customer base continues to be problematic, Box could end up falling even further behind rivals like Dropbox, which is growing faster and driving substantially greater revenues,” King said.

For the next quarter, Box said, it’s expecting revenue of between $193 million and $195 million, ahead of Wall Street’s forecast of $192.8 million. For the full year, Box said it’s expecting revenue of $767 million to $770 million.

Photo: JD Lasica/Flickr