Over the last four quarters, the company has surpassed consensus EPS estimates four times. Braze, Inc. (BRZE) came out with a quarterly loss of $0.05 per share versus the Zacks Consensus Estimate of a loss of $0.10. This compares to loss of $0.13 per share a year ago. These figures are adjusted for non-recurring items. Braze, which belongs to the Zacks Technology Services industry, posted revenues of $135.46 million for the quarter ended April 2024, surpassing the Zacks Consensus Estimate by 2.96%. This com ...

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ At May 31, 2024, there were 77,451,377 shares of the registrant's Class A and 24,175,408 shares of the registrant's Class B common stoc ...

Revenue Performance - Revenue for the first quarter of fiscal 2025 was $135.5 million, a 33.1% increase year-over-year from $101.8 million[20] - Subscription revenue was $130.1 million, up from $97.1 million in the same quarter last year[20] - Braze reported revenue of $135.5 million for the quarter ended April 30, 2024, representing a 33.1% increase from $101.8 million in the same quarter of 2023[35] - The company provided guidance for Q2 FY 2025 revenue between $140.5 million and $141.5 million, and full-year revenue guidance of $577.0 million to $581.0 million[43] Customer Metrics - Total customers increased to 2,102 from 1,866 a year ago, with 212 customers having annual recurring revenue (ARR) of $500,000 or more[20] - Dollar-based net retention for all customers was 117%, down from 122% year-over-year[20] - Braze's dollar-based net retention rate was not explicitly stated but is calculated based on the annual recurring revenue (ARR) from existing customers[47] Financial Performance - GAAP gross margin was 67.1%, slightly down from 67.9% in the first quarter of fiscal 2024[20] - Non-GAAP gross margin was 67.9%, compared to 68.8% in the same quarter last year[20] - Gross profit for the quarter was $90.9 million, up from $69.1 million year-over-year, resulting in a gross margin of approximately 67.1%[35] - Total operating expenses for the quarter were $131.0 million, up from $111.0 million in the same quarter of the previous year[35] Losses and Cash Flow - GAAP operating loss was $40.1 million, an improvement from a loss of $41.9 million in the prior year[20] - Non-GAAP operating loss was $10.0 million, compared to a loss of $16.0 million in the first quarter of fiscal 2024[20] - The net loss attributable to Braze, Inc. was $35.6 million, compared to a net loss of $38.5 million in the prior year, indicating a reduction in losses[35] - Non-GAAP loss from operations was $(9,979,000), a significant improvement from $(15,998,000) in the prior year, reflecting a 37.6% reduction in losses[55] - Non-GAAP net loss attributable to Braze, Inc. was $(5,540,000), down from $(12,555,000) year-over-year, indicating a 55.8% improvement[55] - Free cash flow was $11.4 million, down from $21.7 million in the same quarter last year[20] - Non-GAAP free cash flow for the three months ended April 30, 2024, was $11,441,000, a decrease from $21,657,000 in the same period last year[62] Deferred Revenue and Obligations - Remaining performance obligations as of April 30, 2024, totaled $657.3 million, with $419.8 million classified as current[20] - Deferred revenue increased to $25,285,000 in Q1 2024, compared to $15,228,000 in Q1 2023, reflecting a 66.5% growth[59] Stock and Assets - Braze's total cash, cash equivalents, restricted cash, and marketable securities amounted to $487.7 million as of April 30, 2024, an increase from $480.0 million as of January 31, 2024[42] - Braze's total assets as of April 30, 2024, were $816.1 million, compared to $810.9 million as of January 31, 2024[52] - The company had approximately 101.5 million weighted average shares outstanding for the quarter[43] Stock-Based Compensation - Stock-based compensation expense for the three months ended April 30, 2024, was $28,278,000, up from $24,146,000 in the prior year, marking a 17.6% increase[55]

The Nasdaq declined over 2% on Tuesday, and if the momentum keeps going, we could see the tech index below 15,000 points. This turbulence makes investors wonder if the bear has awaked from its slumber, but there still are hypergrowth stocks to buy out there.Generally speaking, this is not good news for hypergrowth stocks to buy or startup firms. However, there can be certain outliers in every market. As the old Wall Street adage goes, bull markets breed complacency, but bear markets breed opportunity. That’ ...

Braze co-founder and CEO Bill Magnuson helps us understand customer engagement.Bill Magnuson is the chairman, CEO, and co-founder of Braze, a customer engagement platform that works with some of business's biggest names. In this podcast, Motley Fool analyst Tim Beyers caught up with Magnuson for a conversation about:Braze's origin story.The power of personalized marketing.The company's latest results, and its plans to create even more value in the future.To catch full episodes of all The Motley Fool's free ...

Key PointsShares of Braze have been under pressure since February, with last week’s report driving further selling. However, it’s starting to look like the stock is extremely oversold and could soon be due for a bounce. Simultaneously, several heavyweight analysts have reiterated their Buy ratings, so the argument for this being an entry opportunity is compelling. 5 stocks we like better than BrazeThe 17% drop from February’s peak, through the middle of last week might well have been a fair warning to inves ...

PART I [Business](index=5&type=section&id=Item%201.%20Business) Braze operates a comprehensive customer engagement platform, serving 2,044 customers and 6.2 billion monthly active users as of January 2024, focusing on growth through customer acquisition, expansion, and AI innovation - Braze is a customer engagement platform that enables brands to manage direct, meaningful relationships with their customers through a **vertically integrated system** for data ingestion, orchestration, classification, and personalization[34](index=34&type=chunk)[208](index=208&type=chunk)[211](index=211&type=chunk) - The company's growth strategy centers on acquiring new customers, expanding within the existing base, geographical expansion, and strengthening technology leadership, particularly in AI[242](index=242&type=chunk)[243](index=243&type=chunk)[244](index=244&type=chunk) - Braze faces **intense competition** from established software companies, including legacy marketing clouds like Adobe and Salesforce, and point solutions such as Airship, Iterable, Klaviyo, and MoEngage[308](index=308&type=chunk) Key Operational Metrics (as of January 2024) | Metric | Value | | :--- | :--- | | Customers | 2,044 | | Monthly Active Users (MAUs) | 6.2 billion (up from 4.8 billion in Jan 2023) | [Risk Factors](index=17&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks in sustaining growth and profitability, including intense competition, reliance on third-party infrastructure, data privacy regulations, and financial challenges from historical net losses and its dual-class stock structure - The company has a history of operating losses, with a **net loss of $130.4 million** for the fiscal year ended January 31, 2024, and an **accumulated deficit of $483.1 million**, making achieving and sustaining profitability a **key risk**[88](index=88&type=chunk)[364](index=364&type=chunk) - Business operations are **highly dependent** on third-party cloud infrastructure, particularly **Amazon Web Services (AWS)**, where any disruption, termination, or cost increase could **significantly harm** the business[15](index=15&type=chunk)[433](index=433&type=chunk) - The company faces **intense competition** from well-established companies like Adobe and Salesforce, which have **greater resources and brand recognition**, potentially leading to **pricing pressure and loss of market share**[341](index=341&type=chunk)[368](index=368&type=chunk) - The business is subject to **stringent and evolving data privacy laws** like GDPR and CCPA, where non-compliance could result in **significant fines, litigation, and reputational damage**[18](index=18&type=chunk)[437](index=437&type=chunk)[438](index=438&type=chunk) - The **dual-class stock structure** concentrates approximately **78.8% of voting power** with holders of Class B common stock, **limiting the influence** of Class A stockholders on corporate matters[130](index=130&type=chunk)[180](index=180&type=chunk) [Unresolved Staff Comments](index=46&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports that it has no unresolved staff comments from the SEC - There are **no unresolved staff comments**[516](index=516&type=chunk) [Cybersecurity](index=46&type=section&id=Item%201C.%20Cybersecurity) Braze maintains an enterprise-wide cybersecurity program overseen by the CTO and audit committee, designed to protect against threats through various tools and audits, with no material incidents reported to date - The company has an **enterprise-wide cybersecurity program** that includes security tools, a bug bounty program, incident response plans, and employee training[92](index=92&type=chunk) - Cybersecurity risk management oversight is delegated to the **audit committee of the board**, which receives **regular reports** from the Chief Technology Officer[62](index=62&type=chunk) - As of the report date, the company has **not identified any cybersecurity incidents** that have **materially affected** or are reasonably likely to materially affect its business, operations, or financial condition[518](index=518&type=chunk) [Properties](index=47&type=section&id=Item%202.%20Properties) The company leases its New York City headquarters, with a new 92,300 square feet lease through January 2034, and maintains additional leased office spaces globally - The company's headquarters is in **New York City**, with a new lease for approximately **92,300 square feet** commencing in October 2023 and terminating in **January 2034**[94](index=94&type=chunk) - Braze leases **additional office space** in **key global cities** including Austin, Berlin, Chicago, Jakarta, London, Paris, San Francisco, Singapore, Sydney, and Tokyo[94](index=94&type=chunk) [Legal Proceedings](index=47&type=section&id=Item%203.%20Legal%20Proceedings) As of the report date, Braze is not a party to any litigation expected to have a material adverse effect on its business or financial condition - The company is **not currently a party** to any litigation expected to have a **material adverse effect** on its business[63](index=63&type=chunk) [Mine Safety Disclosures](index=47&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - **Not applicable**[519](index=519&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities](index=48&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Braze's Class A common stock trades on Nasdaq under "BRZE"; the company has never paid dividends and intends to retain earnings for business expansion - The company's **Class A common stock** is traded on **The Nasdaq Global Select Market** under the symbol "**BRZE**"[41](index=41&type=chunk) - Braze has **never paid dividends** and does not intend to in the foreseeable future, **retaining earnings for business expansion**[42](index=42&type=chunk) [Reserved](index=48&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved and contains no information - Item 6 is **reserved**[66](index=66&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=48&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) For FY2024, Braze reported $471.8 million revenue, up 33%, with a net loss of $130.4 million, improved gross margin, positive operating cash flow of $6.9 million, and strong retention rates Key Financial Performance (Fiscal Year Ended Jan 31) | Metric | 2024 | 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | $471.8M | $355.4M | +33% | | Net Loss | ($130.4M) | ($140.7M) | -7.3% | | Gross Profit | $324.3M | $239.6M | +35.3% | | Gross Margin | 68.7% | 67.4% | +1.3 p.p. | | Cash from Operations | $6.9M | ($22.3M) | N/A | - Revenue growth of **$116.4 million** was primarily driven by a **$112.7 million** increase in subscription revenue, with approximately **66.8%** from existing customers and **33.2%** from new customers[116](index=116&type=chunk) - The dollar-based net retention rate for the trailing 12 months ended January 31, 2024, was **117%** for all customers and **120%** for customers with ARR of **$500,000** or more[72](index=72&type=chunk) - The number of customers with Annual Recurring Revenue (ARR) of **$500,000** or more grew to **202** as of January 31, 2024, up from **156** in the prior year[72](index=72&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=59&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks are interest rate risk on its $480.0 million portfolio and foreign currency exchange rate risk from international operating expenses, with no hedging activities to date - The company is exposed to **interest rate risk** on its **$480.0 million** portfolio of cash, cash equivalents, and marketable securities, where a hypothetical **10%** change in interest rates is **not expected to have a material impact**[720](index=720&type=chunk)[766](index=766&type=chunk) - **Foreign currency exchange rate risk** exists as **operating expenses** are denominated in local currencies of foreign subsidiaries, and while most sales are in U.S. dollars, **fluctuations in exchange rates** can affect consolidated results[739](index=739&type=chunk) - Inflation has **not had a material effect** on the business, but the company notes that if costs become subject to inflationary pressures, it may **not be able to fully offset** them through price increases[719](index=719&type=chunk) [Financial Statements and Supplementary Data](index=61&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements for fiscal years 2022-2024, including notes on accounting policies, the North Star acquisition, and disclosures on revenue, deferred revenue, and net operating loss carryforwards - The report from the independent auditor, Ernst & Young LLP, provides an **unqualified opinion** on the consolidated financial statements and the **effectiveness of internal control over financial reporting**[743](index=743&type=chunk)[775](index=775&type=chunk) - On June 1, 2023, the company **acquired North Star Y, Pty Ltd**, its exclusive reseller in Australia and New Zealand, for a total consideration of **$27.0 million**, resulting in the recognition of **$28.4 million in goodwill**[621](index=621&type=chunk)[671](index=671&type=chunk)[1005](index=1005&type=chunk) - As of January 31, 2024, the company had federal and state **net operating loss (NOL) carryforwards** of approximately **$355.4 million** and **$248.4 million**, respectively, which may be available to offset future taxable income, subject to certain limitations[51](index=51&type=chunk) - Total stock-based compensation expense recognized for the fiscal year ended January 31, 2024 was **$99.3 million**, up from **$73.3 million** in the prior year[634](index=634&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=99&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on any matter of accounting principles or practices, or financial statement disclosure - **None**[1029](index=1029&type=chunk) [Controls and Procedures](index=99&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective as of January 31, 2024, having remediated a prior material weakness in revenue recognition controls, with the Braze Australia acquisition excluded from internal control evaluation - Management concluded that disclosure controls and procedures were **effective** as of January 31, 2024[652](index=652&type=chunk) - A **material weakness** in internal control over financial reporting related to revenue recognition, identified in the prior fiscal year, has been **successfully remediated** as of January 31, 2024[679](index=679&type=chunk)[1033](index=1033&type=chunk) - The audit of internal controls **excluded** the acquisition of Braze Australia (formerly North Star), which represented approximately **1% of total assets** and **6% of total revenues**[653](index=653&type=chunk) [Other Information](index=100&type=section&id=Item%209B.%20Other%20Information) Several executive officers, including the CTO, President and CCO, and CFO, entered into Rule 10b5-1 trading plans for future stock sales during the fourth fiscal quarter - The **Chief Technology Officer**, **President and Chief Commercial Officer**, and **Chief Financial Officer** each entered into **Rule 10b5-1(c) trading plans** for the sale of Class A common stock[681](index=681&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=100&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) This item is not applicable to the company - **Not applicable**[1015](index=1015&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=101&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information regarding directors, executive officers, and corporate governance is incorporated by reference from the company's 2024 Proxy Statement - Information is **incorporated by reference** from the forthcoming **2024 Proxy Statement**[683](index=683&type=chunk) [Executive Compensation](index=101&type=section&id=Item%2011.%20Executive%20Compensation) Information detailing executive compensation is incorporated by reference from the company's 2024 Proxy Statement - Information is **incorporated by reference** from the forthcoming **2024 Proxy Statement**[1017](index=1017&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=101&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information concerning security ownership by major shareholders and management is incorporated by reference from the company's 2024 Proxy Statement - Information is **incorporated by reference** from the forthcoming **2024 Proxy Statement**[1018](index=1018&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=101&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information regarding related party transactions and director independence is incorporated by reference from the company's 2024 Proxy Statement - Information is **incorporated by reference** from the forthcoming **2024 Proxy Statement**[684](index=684&type=chunk) [Principal Accounting Fees and Services](index=101&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Information detailing fees paid to the principal accountant is incorporated by reference from the company's 2024 Proxy Statement - Information is **incorporated by reference** from the forthcoming **2024 Proxy Statement**[1019](index=1019&type=chunk) PART IV [Exhibits, Financial Statement Schedules](index=102&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists Form 10-K exhibits, noting consolidated financial statements are in Item 8 and financial statement schedules are omitted due to inapplicability or prior inclusion - The consolidated financial statements are located in **Item 8** of the report[1040](index=1040&type=chunk) - Financial statement schedules have been **omitted** because the information is **not applicable** or is included elsewhere in the report[1021](index=1021&type=chunk) [Form 10-K Summary](index=103&type=section&id=Item%2016.%20Form%2010-K%20Summary) This optional section for a Form 10-K summary has not been utilized by the company - **No summary** is provided in this optional section[1024](index=1024&type=chunk)

Financial Performance - Fourth quarter revenue increased by 33% year-over-year to $131.0 million, up from $98.7 million in the same quarter last year[2] - Fiscal year 2024 revenue reached $471.8 million, a 32.7% increase from $355.4 million in fiscal year 2023[11] - Braze reported revenue of $130,957,000 for the three months ended January 31, 2024, representing a 32.6% increase from $98,675,000 in the same period of 2023[29] - Gross profit for the same period was $87,965,000, up from $65,250,000 in 2023, indicating a gross margin improvement[29] - Net loss for the fiscal year ended January 31, 2024, was $130,429 million, an improvement from a net loss of $140,746 million in the previous year[42] - Braze reported a net loss of $28,578,000 for the three months ended January 31, 2024, an improvement from a net loss of $33,808,000 in the same period of 2023[29] Customer Metrics - Total customers grew to 2,044 as of January 31, 2024, compared to 1,770 a year earlier, with 202 customers having annual recurring revenue (ARR) of $500,000 or more[2] - Dollar-based net retention rate for the trailing 12 months was 117%, down from 124% in the previous year[2] Operating Expenses - Operating expenses totaled $120,258,000 for the three months ended January 31, 2024, compared to $101,770,000 in 2023, reflecting a 18.1% increase[29] - The company experienced a loss from operations of $32,293,000 for the three months ended January 31, 2024, compared to a loss of $36,520,000 in the same period of 2023[29] Profitability Metrics - GAAP gross margin improved to 67.2% from 66.1% in the same quarter last year[2] - GAAP net loss per share improved to $0.29 from $0.35 in the fourth quarter of the previous year[10] - Non-GAAP operating loss for the fourth quarter was $7.5 million, an improvement from a loss of $16.7 million in the previous year[10] - GAAP operating margin for the three months ended January 31, 2024, was (24.7)%, an improvement from (37.0)% in the same period last year[46] - Non-GAAP operating margin for the three months ended January 31, 2024, was (5.7)%, compared to (17.0)% in the prior year[46] Cash Flow and Assets - Cash and cash equivalents at the end of the period were $72,131 million, slightly down from $72,623 million at the beginning of the period[42] - The company reported a net cash provided by operating activities of $6,850 million, a significant recovery from a net cash used of $22,308 million in the previous year[42] - Net cash provided by operating activities for the three months ended January 31, 2024, was $3,821 thousand, a significant increase from $12 thousand in the same period last year[47] Future Guidance - Guidance for fiscal Q1 2025 revenue is projected between $131.0 million and $132.0 million, with full year guidance set at $570.0 million to $575.0 million[6] Product Development - New product features launched include AI Item Recommendations and Personalized Paths, enhancing the Sage AI by Braze offering[9] Stock-Based Compensation - Total stock-based compensation expense for the three months ended January 31, 2024, was $24,216,000, up from $18,825,000 in the same period of 2023[30] - Stock-based compensation for the fiscal year was $3,585 million, compared to $3,616 million in the previous year, showing a slight decrease[45]

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NEW YORK--(BUSINESS WIRE)--Braze (Nasdaq: BRZE), the leading customer engagement platform that empowers brands to Be Absolutely Engaging™, today announced strategic leadership appointments and new customer wins on the heels of a significant financial milestone. As previously announced, the company recently passed $500 million of Committed Annual Recurring Revenue (CARR), demonstrating the continued demand for Braze as brands recognize the critical role of customer engagement in driving growth, loyalty, and ...