Braze(US:BRZE)2025-12-09 22:42Revenue Performance - Revenue for the three months ended October 31, 2025, was $190.8 million, a 25.5% increase from $152.1 million in the same period of 2024[153]. - Revenue for the three months ended October 31, 2025, was $190,842,000, representing a $38,790,000 increase or 25.5% compared to $152,052,000 for the same period in 2024[187]. - Revenue for the nine months ended October 31, 2025, increased by $100.0 million, or 23.1%, to $533.0 million compared to $433.0 million for the same period in 2024, driven primarily by a $92.0 million increase in subscription revenue[194]. Customer Metrics - Monthly active users increased to approximately 7.8 billion as of October 31, 2025, up from approximately 7.2 billion as of January 31, 2025[157]. - The company had 2,528 customers as of October 31, 2025, across various industries[154]. - Total customers grew to 2,528 as of October 31, 2025, from 2,211 as of October 31, 2024, indicating strong customer acquisition[194]. Financial Losses - Net losses for the three months ended October 31, 2025, were $35.8 million, compared to $28.1 million in the same period of 2024[153]. Cash Flow and Liquidity - Non-GAAP free cash flow was $44.2 million for the nine months ended October 31, 2025, compared to $4.4 million for the same period in 2024[153]. - Net cash provided by operating activities was $52.1 million for the nine months ended October 31, 2025, compared to $19.6 million for the same period in 2024[206]. - Free cash flow increased to $44.2 million for the nine months ended October 31, 2025, from $4.4 million in the same period in 2024, reflecting higher collections from new contracts[216]. - Cash, cash equivalents, and marketable securities totaled $387.3 million as of October 31, 2025, providing a solid liquidity position for the company[203]. - The company anticipates that its current cash and marketable securities will be sufficient to meet working capital and capital expenditure requirements for at least the next 12 months[218]. Operating Expenses - Operating expenses are expected to increase as the company expands its operations and personnel headcount[176]. - Sales and marketing expenses rose to $88,596,000, an increase of $13,938,000 or 18.7% compared to $74,658,000 in 2024, driven by higher personnel and promotional costs[190]. - Research and development expenses increased by $11,212,000 or 34.1% to $44,067,000, primarily due to higher personnel costs and an increase in software costs[191]. - General and administrative expenses were $33,093,000, up $1,894,000 or 6.1% from $31,199,000 in 2024, largely due to increased personnel costs[192]. - Operating expenses for sales and marketing rose by $32.3 million, or 15.1%, to $245.3 million, primarily due to increased personnel and overhead costs[198]. - Research and development expenses increased by $21.7 million, or 21.7%, to $122.1 million, driven by higher personnel and software costs[199]. - General and administrative expenses rose by $24.1 million, or 27.9%, to $110.4 million, largely due to increased personnel costs and acquisition-related expenses[200]. Profitability Metrics - Gross profit for the three months ended October 31, 2025, was $128,211,000, a $22,069,000 increase or 20.8% from $106,142,000 in 2024, with a gross margin of 67.2%[188][189]. - Gross profit increased by $62.2 million, or 20.8%, to $361.3 million, while gross margin decreased to 67.8% from 69.1% due to increased costs related to the acquisition of OfferFit and a one-time charge related to a service disruption[197]. Retention and Growth Metrics - The dollar-based net retention rate for the trailing 12 months ended October 31, 2025, was 108%, down from 113% for the same period in 2024[161]. - Subscription revenue increased by $35,400,000, or 24.2%, with 44.8% of this growth coming from existing customers and 55.2% from new customers, bringing total customers to 2,528[187]. Future Outlook and Investments - The company plans to continue investing in research and development to enhance its platform and expand channel offerings[165]. - The company expects to continue investing in sales and marketing to drive growth, anticipating an increase in absolute dollars for these expenses[178]. - Research and development expenses are also expected to rise in absolute dollars as the company enhances its platform to attract new customers[180]. - General and administrative expenses are projected to increase in absolute dollars but decrease as a percentage of revenue over the long term as the company scales its internal support functions[182]. Market and Economic Factors - The company has experienced seasonality in revenue costs, with the highest usage typically occurring in the fourth quarter due to holiday season activities[221]. - A hypothetical 10% change in interest rates would not have a material impact on the company's consolidated financial statements as of October 31, 2025[228]. - The company’s revenue is primarily denominated in U.S. dollars, with minimal exposure to foreign currency risk, except for sales in Japan denominated in Yen[229]. - The company uses derivative financial instruments, such as forward exchange contracts, to hedge against foreign currency exchange rate fluctuations[230]. - The company does not believe inflation has materially affected its financial condition, but rising costs could harm its operations if not offset by price increases[226]. Commitments and Obligations - The company has non-cancelable purchase commitments totaling $134.1 million and operating lease obligations of $84.1 million as of October 31, 2025[219]. - The company’s future funding requirements may lead to seeking additional equity or debt if current estimates prove inaccurate[220].