On June 6, 2024, Braze Inc (BRZE, Financial) released its 8-K filing for the fiscal quarter ended April 30, 2024. Braze Inc is a customer engagement platform that powers customer-centric interactions between consumers and brands. The company provides solutions for Retail & E-commerce, Media & Entertainment, Financial Services, and Travel & Hospitality related industries. It offers a single, vertically integrated platform that encompasses various functionalities required for modern customer engagement, supported by its AI engine, Sage AI by Braze.
Performance Overview
Braze Inc (BRZE, Financial) reported revenue of $135.5 million for the fiscal first quarter of 2025, a 33.1% increase from $101.8 million in the same quarter of the previous fiscal year. This figure surpassed the analyst estimate of $131.67 million. The revenue growth was driven primarily by new customers, upsells, and renewals, despite a $0.8 million revenue reserve related to an April service outage.
Financial Highlights
Subscription revenue for the quarter was $130.1 million, up from $97.1 million in the prior year, while professional services and other revenue increased to $5.4 million from $4.6 million. The company's remaining performance obligations stood at $657.3 million as of April 30, 2024, with $419.8 million classified as current.
GAAP gross margin was 67.1%, slightly down from 67.9% in the previous year, while non-GAAP gross margin was 67.9%, compared to 68.8% in the same period last year. The dollar-based net retention rate for all customers was 117%, down from 122% in the previous year, and for customers with annual recurring revenue (ARR) of $500,000 or more, it was 119%, compared to 124% last year.
Income Statement and Key Metrics
| Metric | Q1 FY2025 | Q1 FY2024 |
|---|---|---|
| Revenue | $135.5 million | $101.8 million |
| GAAP Operating Loss | $40.1 million | $41.9 million |
| Non-GAAP Operating Loss | $10.0 million | $16.0 million |
| GAAP Net Loss per Share | $0.35 | $0.40 |
| Non-GAAP Net Loss per Share | $0.05 | $0.13 |
Cash Flow and Balance Sheet
Net cash provided by operating activities was $19.4 million, down from $22.5 million in the same quarter last year. Free cash flow also decreased to $11.4 million from $21.7 million. Total cash and cash equivalents, restricted cash, and marketable securities were $487.7 million as of April 30, 2024, compared to $480.0 million as of January 31, 2024.
Business Highlights and Future Outlook
Braze Inc (BRZE, Financial) secured notable new business wins, including Bauer Media Group, Bolt Technology, and Hugo Boss, among others. The company also announced an expansion of its global footprint with new offices in São Paulo, Brazil; Bucharest, Romania; Dubai, UAE; and Seoul, South Korea. Additionally, Braze plans to open a new data center in Indonesia, its second outside the US.
“We are off to a solid start in fiscal 2025, delivering strong results in an uneven macro, driven by returns from our long-term investments and consistent execution,” said Bill Magnuson, cofounder and CEO of Braze.
For the fiscal second quarter ending July 31, 2024, Braze Inc (BRZE, Financial) expects revenue between $140.5 million and $141.5 million. For the full fiscal year ending January 31, 2025, the company anticipates revenue between $577.0 million and $581.0 million.
Overall, Braze Inc (BRZE, Financial) demonstrated robust revenue growth and a narrowing operating loss, indicating effective execution of its strategic initiatives. However, the company faces challenges such as maintaining high retention rates and managing operating expenses, which will be crucial for sustaining its growth trajectory.
Explore the complete 8-K earnings release (here) from Braze Inc for further details.
