Core Viewpoint - Braze, Inc. (BRZE) has experienced a significant downtrend, with a 27.8% decline in stock price over the past four weeks, but it is now in oversold territory, suggesting a potential turnaround due to improved earnings expectations from analysts [1]. Group 1: Technical Indicators - The Relative Strength Index (RSI) is a key technical indicator used to identify oversold stocks, with a reading below 30 typically indicating oversold conditions [2]. - BRZE's current RSI reading is 29.18, suggesting that the heavy selling pressure may be exhausting, indicating a possible price rebound [5]. Group 2: Fundamental Analysis - Analysts have shown strong consensus in raising earnings estimates for BRZE, with a 15.2% increase in the consensus EPS estimate over the last 30 days, which often correlates with price appreciation [6]. - BRZE holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, further supporting the potential for a near-term turnaround [7].

The price trend for Braze, Inc. (BRZE) has been bearish lately and the stock has lost 9.9% over the past week. However, the formation of a hammer chart pattern in its last trading session indicates that the stock could witness a trend reversal soon, as bulls might have gained significant control over the price to help it find support. The formation of a hammer pattern is considered a technical indication of nearing a bottom with likely subsiding of selling pressure. But this is not the only factor that make ...

2025 will be a good year for stocks, especially smaller companies like Braze NASDAQ: BRZE, LightPath Technologies NASDAQ: LPTH, and Guidewire NYSE: GWRE. Not only is the FOMC on track to reduce interest rates and usher in a new age for equities, but the AI focus will move from infrastructure to application, where these businesses will shine. Simply put, as big as the AI infrastructure boom has been, the boom in AI-driven services expansion will be bigger and create the next round of would-be multi-baggers f ...

Core Viewpoint - Braze, Inc. (BRZE) has experienced a significant downtrend, with a 17.3% decline in stock price over the past four weeks, but it is now in oversold territory, suggesting a potential turnaround due to improved earnings expectations from analysts [1]. Group 1: Stock Performance - The stock has declined 17.3% over the past four weeks, indicating strong selling pressure [1]. - The Relative Strength Index (RSI) for BRZE is currently at 29.27, suggesting that the heavy selling may be exhausting itself, which could lead to a price rebound [3]. Group 2: Analyst Sentiment - There is strong consensus among sell-side analysts regarding an increase in earnings estimates for BRZE, with a 12.9% rise in the consensus EPS estimate over the last 30 days [4]. - BRZE holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, indicating a favorable outlook for the stock [4].

We Are Investment overview I wrote about Braze, Inc. (NASDAQ:BRZE) previously (Mid-June 2024) with a buy rating as I see a long growth runway ahead for the business, and it was apparent that the poor macro backdrop was not impacting the business growth strength at all. I remain bullish on BRZE, as I don't think the sharp sell-down in share price is justified. I think the slowdown in certain operating metrics is not due to structural weakness, and we should see a recovery eventually. 2Q25 earnings (announced ...

Financial Data and Key Metrics Changes - Revenue for Q2 2025 reached $145.5 million, representing a 26% year-over-year increase [6][20] - Non-GAAP gross margin improved to 70.9%, up 90 basis points from the previous year [6][22] - Non-GAAP operating income was $4.2 million, compared to a loss of $7.6 million in the prior year [24] - Non-GAAP net income attributable to Braze shareholders was $9.1 million, or $0.09 per share, compared to a loss of $3.9 million, or a loss of $0.04 per share in the prior year [24] Business Line Data and Key Metrics Changes - Customer count increased to 2,163, up 10% year-over-year [20] - Large customers (spending at least $500,000 annually) grew to 222, a 28% year-over-year increase [11][20] - Dollar-based net retention was 114%, with large customers at 117% [21] Market Data and Key Metrics Changes - Revenue outside the U.S. contributed 5% to total revenue, down from 43% in the prior year [21] - Total remaining performance obligation was $690 million, up 32% year-over-year [21] Company Strategy and Development Direction - The company is focusing on the legacy vendor replacement cycle and point solution consolidation trends to drive growth [7][9] - Investments are being made in product innovation, AI initiatives, and expanding the customer community [12][16] - The Braze data platform was introduced to enhance data capabilities and streamline customer engagement [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating macroeconomic challenges while focusing on long-term goals [12] - The company anticipates continued growth driven by customer engagement strategies and AI advancements [9][12] - Management highlighted the importance of maintaining operational efficiency and profitability [19][24] Other Important Information - The company celebrated its 13-year anniversary and launched the Braze data platform [13] - A free trial program and a "Braze for Startups" initiative were announced to attract new customers [16][17] - The annual customer conference, Forge, is scheduled for September 23-25, where further product innovations will be revealed [18] Q&A Session Summary Question: Customer interest in RCS with Apple supporting it - Management is excited about RCS and is preparing full support, noting its advantages over SMS [30] Question: Member retention outlook for the year - Management indicated that member retention is not yet stabilizing and is impacted by historical performance [34] Question: AI's role in legacy Marketing Cloud replacement - AI is a critical part of the deal cycle, with varying attitudes from companies regarding vendor consolidation [36] Question: Impact of macro environment on business metrics - Management noted that the macro environment has influenced metrics like dollar-based net retention and deferred revenue [40][41] Question: Company-specific initiatives for growth - Management believes that initiatives like free trials and product-led growth will help reaccelerate business over the next 12-18 months [44][49] Question: Role of the Braze data platform - The Braze data platform aims to enhance customer engagement outcomes and integrate with existing customer data ecosystems [55][57]

Core Viewpoint - Braze, Inc. reported strong financial results for Q2 2025, with a revenue increase of 26% year-over-year, reaching $145.5 million, and achieving non-GAAP operating income profitability for the first time, indicating effective business execution and growth potential in customer engagement solutions [9][39]. Financial Performance - Revenue for Q2 2025 was $145.5 million, up 26% year-over-year [9][31]. - Non-GAAP gross margin improved to 70.9%, a rise of 90 basis points compared to the previous year [9][35]. - Non-GAAP operating income was $4.2 million, representing 3% of revenue, compared to a loss of $7.6 million in the prior year [39]. - Non-GAAP net income attributable to Braze shareholders was $9.1 million, or $0.09 per share, compared to a loss of $3.9 million in the prior year [39]. Customer Growth and Engagement - Customer count reached 2,163, an increase of 61 during the quarter and 205 year-over-year [11][32]. - The number of large customers (spending at least $500,000 annually) grew to 222, up 28% year-over-year, contributing 61% to total ARR [15][32]. - Dollar-based net retention was 114%, with large customers at 117% [33]. Product and Market Strategy - Braze is focusing on the legacy vendor replacement cycle and point solution consolidation trends, which are expected to drive market share gains as brands seek modern customer engagement solutions [10][12]. - The company launched the Braze data platform to enhance data capabilities and streamline customer engagement processes [18][80]. - New initiatives such as "Braze for Startups" and a free trial program aim to expand the customer base and improve engagement [24][25]. Guidance and Future Outlook - For Q3 2025, Braze expects revenue between $147.5 million and $148.5 million, representing approximately 19% year-over-year growth at the midpoint [41]. - Full fiscal year 2025 revenue is projected to be between $582.5 million and $585.5 million, indicating a year-over-year growth rate of approximately 24% at the midpoint [44]. - The company anticipates continued investment in product innovation and customer engagement strategies to solidify its market position [12][70].

Q2 Fiscal 2025 Earnings Results September 5, 2024 braze | --- | --- | --- | --- | |----------------------------------------------|---------------------------------|----------------------------|------------------------------| | | | Braze Financial Highlights | | | $582M | 26% | | 2,163 | | QUARTERLY REVENUE RUN | YoY REVENUE | | CUSTOMERS IN OVER 75 | | RATE 1 114% DOLLAR-BASED NET RETENTION RATE | GROWTH 96% SUBSCRIPTION REVENUE | | COUNTRIES $23M GAAP NET LOSS | Forward-Looking Statements This presentation ...

Core Insights - Braze, Inc. reported quarterly earnings of $0.09 per share, exceeding the Zacks Consensus Estimate of a loss of $0.03 per share, marking a 400% earnings surprise [1] - The company achieved revenues of $145.5 million for the quarter ended July 2024, surpassing the Zacks Consensus Estimate by 3.13% and showing a year-over-year increase from $115.11 million [2] Financial Performance - Over the last four quarters, Braze has consistently surpassed consensus EPS estimates, achieving this four times [2] - The company has also topped consensus revenue estimates in each of the last four quarters [2] Stock Performance - Braze shares have declined approximately 18.7% since the beginning of the year, contrasting with the S&P 500's gain of 15.7% [3] - The current Zacks Rank for Braze is 3 (Hold), indicating expected performance in line with the market in the near future [6] Future Outlook - The consensus EPS estimate for the upcoming quarter is -$0.01 on revenues of $147.38 million, while for the current fiscal year, it is -$0.08 on revenues of $578.99 million [7] - The outlook for the Technology Services industry, where Braze operates, is currently in the top 28% of over 250 Zacks industries, suggesting a favorable environment for performance [8]

Financial Performance - Revenue for the three months ended July 31, 2024, was $145,499,000, representing a 26.3% increase from $115,107,000 in the same period of 2023[17]. - Gross profit for the six months ended July 31, 2024, was $192,990,000, up from $148,726,000 in the prior year, indicating a 29.7% growth[17]. - Total operating expenses for the three months ended July 31, 2024, were $130,029,000, compared to $115,002,000 in 2023, reflecting a 13.0% increase[17]. - Net loss attributable to Braze, Inc. for the three months ended July 31, 2024, was $22,999,000, an improvement from a net loss of $31,694,000 in the same quarter of 2023[17]. - Comprehensive loss attributable to Braze, Inc. for the three months ended July 31, 2024, was $19,859,000, down from $32,260,000 in the same period of 2023[20]. - Net loss for the quarter ending July 31, 2024, was $58.856 million, compared to a net loss of $70.875 million for the same period in 2023, indicating a reduction in losses of approximately 17.8%[29]. - Revenue for the six months ended July 31, 2024, was $280.96 million, an increase of $64.07 million or 29.5% compared to $216.89 million for the same period in 2023[153]. Assets and Liabilities - Cash and cash equivalents increased to $79.1 million as of July 31, 2024, from $68.2 million as of January 31, 2024, representing a growth of 13%[15]. - Total current assets rose to $606.4 million, up from $601.1 million, indicating a slight increase of 0.5%[15]. - Total liabilities increased to $371.9 million from $366.5 million, a rise of 1.2%[15]. - The accumulated deficit grew to $541.7 million from $483.1 million, an increase of 12.1%[15]. - Total stockholders' equity increased to $453.7 million from $444.2 million, a growth of 2.5%[15]. - Total assets as of July 31, 2024, were $825,575,000, up from $810,941,000 as of January 31, 2024[15]. - Total accrued expenses and other current liabilities amounted to $65,164,000 as of July 31, 2024, up from $63,264,000 as of January 31, 2024[72]. Revenue Streams - Subscription revenue for the six months ended July 31, 2024, reached $270.1 million, up 30.7% from $206.9 million in the same period of 2023[45]. - Revenue recognized from deferred revenue for the three and six months ended July 31, 2024, was $59.9 million and $158.3 million, respectively, compared to $51.1 million and $128.2 million for the same periods in 2023[49]. - Deferred revenue increased to $212.1 million, up from $204.3 million, reflecting a growth of 3.9%[15]. - Deferred revenue rose to $7.828 million for the quarter ending July 31, 2024, compared to $6.471 million for the same period in 2023, marking an increase of about 20.9%[29]. Expenses - Research and development expenses for the three months ended July 31, 2024, were $33,141,000, an increase from $29,132,000 in the same quarter of 2023, marking a 13.9% rise[17]. - Sales and marketing expenses for the three months ended July 31, 2024, were $68,569,000, compared to $60,417,000 in the same period of 2023, reflecting a 13.5% increase[17]. - Total operating expenses for the three months ended July 31, 2024, were $130,029,000, compared to $115,002,000 in 2023, reflecting a 13.0% increase[17]. - General and administrative expenses grew by $2,866 thousand, or 11.3%, to $28,319 thousand, mainly due to investments in finance and administrative functions[151]. Cash Flow - Net cash provided by operating activities was $31.007 million for the quarter ending July 31, 2024, compared to $5.032 million for the same period in 2023, representing a significant increase of approximately 515%[29]. - Free cash flow for the six months ended July 31, 2024, increased to $18,675,000 from $2,965,000 for the same period in 2023, primarily due to higher collections from new contracts and renewals[170]. - The company reported cash flows from operating activities of $31.007 million for the quarter ending July 31, 2024, a significant increase from $5.032 million in the previous year[29]. Customer Metrics - The company had approximately 2,163 customers as of July 31, 2024, indicating growth opportunities in various verticals[116]. - Monthly active users increased to approximately 6.7 billion as of July 31, 2024, up from approximately 6.2 billion as of January 31, 2024[120]. - The dollar-based net retention rate for the trailing 12 months ended July 31, 2024, was 114%, down from 120% in the previous year[124]. - Approximately 45% of revenue for the six months ended July 31, 2024, was generated outside of the United States, compared to 43% in the same period of 2023[127]. Future Outlook - The company anticipates continued growth in customer acquisition and retention, aiming to enhance platform usage and upsell opportunities[6]. - Future strategies include potential international expansion and investments in new product development to capture a larger market share[6]. - The company plans to continue investing in research and development to enhance its platform and expand its channel offerings[128]. - Operating expenses are expected to increase as the company expands its operations and invests in sales and marketing[136]. Stock-Based Compensation - Stock-based compensation increased to $58.756 million in the quarter ending July 31, 2024, up from $49.002 million in the same quarter of 2023, reflecting a growth of about 19.5%[29]. - Total stock-based compensation expense for the three months ended July 31, 2024 was $30.5 million, compared to $25.2 million for the same period in 2023, reflecting a year-over-year increase of 13.1%[82]. - As of July 31, 2024, the company had unrecognized compensation costs of $18.6 million related to stock options and $201.7 million related to RSUs[83]. Acquisitions - The Company acquired North Star Y, Pty Ltd for a total purchase price of $26.9 million, which included cash payments of $17.6 million and $6.1 million in Braze Class A common stock[102][103]. - The fair value of contingent consideration related to the North Star acquisition is $0.1 million, with earn-out payments capped at $10.0 million for the first period and $16.0 million for the second period[103].