Cloud Frenemies On The Rise

COUAfter beating Wall St. earnings consensus for his company?s third quarter as a public company only to see shares fall in Thursday morning trading, Box CEO Aaron Levie might be justified in growing tired of the investor dance. But after speaking with analysts late Wednesday, Levie found time to talk a subject his company knows very well: the wave of partnerships emerging in the enterprise cloud market and what it means for companies from Apple to Salesforce.

On Box?s earnings, Levie says his mentality is to ?try not to make too much of the roller coaster.? ?Box beat analyst expectations for fiscal Q2 with revenue of $73.5 million and upped its revenue forecast for the rest of the year. It reported a wider loss than a year before, but still beat consensus by a penny at a loss per share of $0.28. The company maintains it has a path to profitability in a few quarters, and increased the number of major deals it signed (more than $100,000) from 21 a year ago to 33, while announcing IBM had agreed to deploy Box throughout it?s a company.

Traders took all that in and then (at least some) spat it out. Shares of the company were down 4% in Thursday morning trading. ?We?re charging ahead,? Levie says, and with its stock in consistent decline since the company?s January IPO, there?s not much else Box can do.

If the tide turns, one area where Box may see more pay-off down the road is through the major partnership?s its signed with other enterprise companies including IBM and the company that dominated tech headlines on Wednesday, Apple. Apple?while announcing a new enterprise-friendly iPad Pro, Apple TV, new features for its smart watch and a new iPhone?called out partners Adobe, Cisco, Microsoft and IBM, with which it announced a wide-ranging partnership for work products last year. This spring, Box announced partnerships with Apple, IBM and Microsoft, too. And next week Marc Benioff?s Salesforce will trot out Microsoft CEO Satya Nadella and a host of partners at its own annual event to talk cloud partnerships.

At the events of the major cloud computing companies, it?s become more of a question of who isn?t showing up.

According to Levie, the trend?s the reflection of enterprise?s shift to heterogeneity. What that means is that the cloud leaders are largely taking a step back from their historical push to cover as many products and services as possible, choosing instead to focus on their killer use case in the market, or what Levie calls their ?best-of-breed solution.? These building blocks are then made available to everyone else, even if they slot in neatly with products operated by companies with their own alternative.

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