NEW YORK (TheStreet) -- Box's (BOX) better-than-expected results for the first quarter impressed analysts, but most saw the earnings as one step on the long march toward profitability for the company.
The cloud-based storage provider posted an adjusted loss of 28 cents per share on revenue of $65.6 million, better than the 31 cent per share loss on $63.7 million predicted by a survey of analysts conducted by Thomson Reuters. That sent the stock higher, with shares jumping 10% Thursday to $19.61 in the early minutes of trading.
Growth at the company was driven by several factors, including a 70% increase in customers to a total of 47,000; a storage deal with the U.S. Department of Justice; and the acquisition of a smaller company that could help Box expand services to different devices.
For the second quarter, estimates from both the Los Altos, Calif.-based company and analysts predicted revenue will move higher, landing somewhere between $69 million and $70 million. Box did not provide estimated earnings per share for the second quarter.
Analysts were upbeat on the company for the short term after the earnings report, with most placing price targets several dollars above Wednesday's closing price of $17.79. Still, several cited long-term concerns about the business, including its ability to continue growing and reach profitability.
Here's what a few had to say:
Credit Suisse analyst Philip Winslow (Outperform, $24 PT)
"Although there is some concern that an increasingly competitive landscape could result in Box experiencing per-seat pricing pressure or difficulty in gaining market share, we maintain a positive opinion of management's vision in terms of Box's enterprise-focused strategy, technology platform, and focus on incorporating incremental, value added functionality (e.g., workflow, vertical-specific features, etc.) that should enable the company to differentiate its offering in the near to medium term."