Box is currently embroiled in a dispute with Starboard Value activist investors over the control of its board. This argument is expected to reach a head at the annual shareholder meeting on September 9th. Box released its earnings report this morning in an unusual move to demonstrate to shareholders that numbers have been improving under the current leadership. This was two weeks before the August 25th reporting date.Companies don't usually report ahead of schedule but Box may see the opportunity to lobby or counter any negative lobbying Starboard might be doing with its fellow investors before the vote.It is also important to note that, despite the meeting being held on September 9th due to a lot more voting these days than usual, people will continue to vote throughout this month, even though it is not yet that far in advance. Box would like to have its most recent financial information available sooner than later to allow early voters to cast their ballots.Box CEO Aaron Levie is happy to report that the numbers are decent.EarningsBox's earnings were released early. The numbers are a strong argument for maintaining the current leadership.The company's second quarter fiscal 2022 saw $214 million in revenue. This is an 11% increase over the previous year. Box was quick to highlight that this quarter marked Box's second consecutive quarter of rapid revenue growth. This is compared to its guidance of $211 to 212 million in revenue.Box's ability to increase its revenue growth is important for many reasons. It makes Box stock more valuable. First, it increases its revenue growth. Companies that grow quickly are more profitable than those that grow slowly. Investor catnip is accelerating revenue growth over time.Boxes' leadership can also argue that Boxes product decisions have been sound. This supports their position that they should continue to be in charge of the company. Why would they want to replace the CEO if they made sound product choices quarters ago and these decisions are leading to faster revenue growth?Box reported more quarterly positive news than its revenue numbers. Box also reported better GAAP and nonGAAP operating margins, a key indicator of profitability, and better billings results than expected for the period. Boxs net retention rate also expanded to 106% from 103% in the sequentially-preceding period.The company also increased its guidance for fiscal year 2008 from $845 million up to $853 million, to $856 million, to $860 million.However, the counter arguments are not difficult to make. Box's revenue growth is increasing, though from a lower base. It is not difficult to accelerate revenue expansion with low base numbers than it is with higher base levels. The net retention of the company is lower than any SaaS company that is business-focused would like to report.Is the good news enough? Box shares are up 1.5% today in regular trading despite a mixed market. Now investors must vote with more than their dollars.Boardroom contextStarboard purchased 7.5% of the company in 2019. It was quiet the first year but it began to make noises at the end 2020, with rumors that the company was being sold. Box received a $500 million investment by private equity firm KKR in April. It gave the investor a seat on the board.Starboard, an activist investor, did not like that idea and sent a letter to investors in May. Starboard stated that it was seeking to purchase several seats on the board and detailed a series of complaints about the company's management. It stated that Aaron Levie, co-founder, and CEO of the company, was to be fired or sold.Box countered that the May 10th letter and the May 10th one did not accurately reflect progress made by the company. Box made the fight public with an SEC filing in July detailing the back-and-forth dance between Starboard and Box since Starboard bought its stake in Starboard.The cloud content management company has resisted all attempts to sell it or fire Levie. However, this will all culminate in the shareholders vote. It's a fight for the company's soul.Starboard could convince shareholders to give it multiple seats on the Box board and push out Levie to take control of the company. It would likely also be able sell the company to the highest bidder. Although not perfect, the early financial report today shows a pattern in increasing good quarters. This is what Box hopes voters will be focusing on as they cast their ballots.
