Good morning. Box CEO Aaron Levie says AI is forcing the company to stretch beyond its original role as a content management platform. The software-as-a-service pioneer is pursuing a future based on helping customers do something similar as they adapt to the pressures of AI.
The company is taking on a more consultative mission. Having re-engineered its own business processes around AI, it's looking to help customers do the same, according to Levie, who co-founded the company as a college student in 2005.
"Maybe 10 years ago, we would be talking to a bank about 'how do you store your files? How do you secure that data?' The infrastructure ... would be the main part of the conversation," Levie told me. "Now, we're actually talking about the process itself...what are you looking to streamline? What decisions could you make better? ... We have to get really, really close to the business and the process," Levie said.
We spoke last week just before the company reported its second quarter results, including record revenue of $321.1 million, up 9% on a year-over-year basis. Box said it increased full-year revenue expectations for fiscal 2027 by $10 million to approximately $1.29 billion, up 10% year-over-year.
Shares are trading this morning around $35.58, just below their year-to-date high of $36.34.
Box was one of the pioneers of software-as-a-service, an area that has been under intense pressure from the rise of AI, especially earlier in the year. Given the growing power of AI, it's conceivable customers can spin up their own software systems. While that may be easier said than done, the fact it's even a possibility has created an existential moment for SaaS. Survival and growth have required a new purpose and mission and a deeper relationship with the customer.
"You have to be embedded in the organization ... in those lines of business in each industry, if you're going to have any real shot of driving automation," Levie said.
Has the pressure of AI forced your company to rethink its mission? Let us know how that's going. Send your feedback to me at steven.rosenbush@wsj.com (if you're reading this in your inbox, you can just hit reply).
Intelligence Layer
Gartner forecasts global semiconductor revenue will hit $1.6 trillion in 2026, up 92% from $809 billion in 2025, and reach $1.9 trillion in 2027. Behind the surge: Ongoing AI infrastructure investment and, with it, stronger-than-expected memory pricing cycle.
The AI data center ecosystem is expected to grow from 36.5% of semiconductor revenue in 2026 to over 53% by 2030, according to the research and advisory firm.
Memory is the big growth driver, forecast to reach $837 billion in 2026 and surpass $1 trillion in 2027.
"AI infrastructure has fundamentally changed the dynamics of the memory market," said Shrish Pant, director analyst at Gartner, in a release. "While pricing expansion is accelerating growth in 2026, continued AI infrastructure deployments, higher memory content per AI server and sustained demand for high-bandwidth memory (HBM) will support memory revenue growth through 2027 and beyond."
Revenue from non-memory semiconductors is also benefiting from the AI build-out. Gartner says the segment is projected to grow to $718 billion in 2026, hitting $864 billion in 2027.
On Our Radar
OpenAI filed a legal response accusing Apple of using a "baseless" trade secret lawsuit to hamper its recruiting and stall its efforts to build competing AI devices, arguing the dispute stems from Apple's own poor offboarding procedures. Apple's suit, filed in the Northern District of California, accuses OpenAI's chief hardware officer, Tang Tan, and Chang Liu, a member of its technical staff, of taking Apple's confidential information by various means, the WSJ reports. Both are former Apple employees.
Separately, OpenAI said Monday that its ad business reached $1 billion in annualized revenue run rate. Ads first started appearing in its chatbot less than 200 days ago, Barron's reports.
Anthropic has struck a $35 billion cloud deal with Nvidia-backed cloud-provider Lambda for computing capacity at a Texas data center, the WSJ reports. With Nvidia itself holding the lease on the data center, the arrangement represents another example of Nvidia's growing role in helping non-investment-grade firms such as Anthropic get access to its computing resources.
Google signed a deal with Fervo Energy for nearly 400 megawatts of power from a Utah geothermal project that will become the world's largest enhanced geothermal facility. The WSJ reports that Google intends to buy the power for a data center in Utah-though it has yet to determine the location.
President Trump took to his social network Monday to address growing bipartisan backlash against the data center build-out, saying those communities that resist will "end up being backwards and poor." Recent polls have found that more than 70% of the public oppose data centers near them, the WSJ reports.
Ernst & Young's U.S. division will invest $100 million in employee rewards to recognize people who show skills like adaptability, innovation and judgment-in short the type of skills the firm believes are needed to work better alongside AI. The WSJ reports the professional-services firm will give cash awards of up to $25,000 to people and teams that make a material difference.
The WSJ Technology Council Summit
The WSJ Tech Council brings together CIOs, CTOs and CISOs advancing innovation and shaping the future. Join this trusted community where tech executives connect with peers to explore emerging trends and gain the perspective they need to stay ahead of disruption.
Request an Invitation
About Us
Follow Isabelle Bousquette on LinkedIn, Instagram, X, and TikTok for more behind the scenes on her tech and AI coverage, and lately, her contributions to the WSJ Leadership Institute's new Executive Resilience series, where she's profiling America's top execs about their fitness and wellness habits.
Follow Belle Lin on LinkedIn and X for her latest reporting on enterprise technology and AI.
Steven Rosenbush is chief of the enterprise technology bureau at the WSJ Leadership Institute. He also has a column. You can follow him on LinkedIn.
Tom Loftus is the editor of The Morning Download. He suggests following Isabelle, Belle and Steve on their various social channels. But if you insist, here's his LinkedIn.