Financial Data and Key Metrics Changes - Braze reported Q1 2026 revenue of $162.1 million, representing a nearly 20% year-over-year increase [6][18] - Non-GAAP operating margin improved by over 900 basis points year-over-year, with non-GAAP net income of $7 million and free cash flow of nearly $23 million [6][24] - Total remaining performance obligation (RPO) was $829.3 million, up 26% year-over-year, while current RPO increased by 24% year-over-year to $522 million [20] Business Line Data and Key Metrics Changes - Subscription revenue accounted for 96% of total revenue, with the remaining 4% from professional services and onboarding fees [18] - The customer count rose to 2,342, an increase of 11% year-over-year, with large customers (spending at least $500,000 annually) growing by 24% year-over-year to 262 [18][19] - Dollar-based net retention (DBNR) was 109 overall and 112 for large customers, indicating strong customer expansion [19] Market Data and Key Metrics Changes - Revenue outside the U.S. contributed 46% of total revenue, up from 45% in the previous quarter [20] - The company secured new business wins across various sectors, including fintech, luxury retail, and healthcare, demonstrating broad market strength [7][9] Company Strategy and Development Direction - Braze aims to become the leading customer engagement platform globally, focusing on AI-driven solutions and first-party data utilization [6][10] - The acquisition of OfferFit is expected to enhance Braze's AI capabilities and customer engagement strategies, allowing for more personalized experiences [12][14] - The company is committed to investing in technology and community to elevate customer engagement practices [11] Management's Comments on Operating Environment and Future Outlook - Management noted that global trade concerns have not significantly impacted deal cycles, and they expect continued momentum despite a noisy macro environment [6][7] - The company anticipates that the legacy replacement cycle and vendor consolidation trends will persist, providing opportunities for market share growth [9][10] - Management expressed confidence in achieving sustained profitable growth while navigating economic uncertainties [6][27] Other Important Information - Braze's non-GAAP gross profit for the quarter was $112 million, with a gross margin of 69.3%, up from 67.9% in the prior year [21] - The company ended the quarter with approximately $540 million in cash and equivalents, indicating strong liquidity [24] Q&A Session Summary Question: Reconciling sequential growth and CRPO dynamics - Management acknowledged that CRPO is sensitive to renewal dollars and emphasized that revenue is the key metric to watch for macro stabilization [32][34] Question: Performance of Project Catalyst - Project Catalyst is in private beta, and while specific uplift case studies are not available, initial results show promise in optimizing customer engagement strategies [43][45] Question: Renewal cadence and OfferFit feedback - Q1 was a heavy renewal quarter, with expectations for a drop in Q2 and Q3, followed by another increase in Q4 [63] - Early feedback on OfferFit has been positive, with strong interest from customers and successful presentations at events [55][57] Question: Pricing and packaging changes - The new pricing model has relaxed data point limits, improving customer flexibility and reducing friction in sales cycles [70][72] Question: Impact of OfferFit on EBIT guidance - OfferFit is expected to contribute significantly to EBIT, with around 80% of the impact attributed to its integration [74][76]

Financial Data and Key Metrics Changes - The company reported Q4 revenue of $160.4 million, representing a 22% year-over-year increase and a 5% increase from the prior quarter [7][19] - Non-GAAP operating income was $8 million, achieving a non-GAAP operating margin of 5%, up from a negative 5.7% in the same quarter last year [7][23] - Non-GAAP net income was $12 million, or $0.12 per share, compared to a loss of $3 million, or a loss of $0.04 per share in the prior year [24] - Free cash flow for the quarter was $15 million, compared to a negative free cash flow of $4 million in the prior year [24] Business Line Data and Key Metrics Changes - Subscription revenue accounted for 96% of total revenue in Q4, with the remaining 4% from professional services and onboarding fees [19] - The total customer count increased by 12% year-over-year to 2,296 customers, with large customers (spending at least $500,000 annually) growing by 22% to 247 [19][20] - Dollar-based net retention was 111%, with large customers showing a retention rate of 114% [20] Market Data and Key Metrics Changes - Revenue from outside the U.S. contributed 45% to total revenue, consistent with the prior quarter and up from 44% in the same quarter last year [20] - The total remaining performance obligation was $793 million, up 24% year-over-year [21] Company Strategy and Development Direction - The company aims to become the leading customer engagement platform globally, focusing on profitable growth while reinvesting in business expansion [8][18] - The acquisition of Offerfit, valued at $325 million, is expected to enhance AI-driven customer engagement capabilities [15][16] - The company is focusing on the retail and consumer goods vertical, which accounts for about 20% of its business, by enhancing e-commerce features and integrations [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing legacy vendor replacement cycle and vendor consolidation trends, which are expected to create more market opportunities [9][10] - The company anticipates continued positive quarterly non-GAAP operating income and free cash flow going forward [8] - Management acknowledged the evolving macroeconomic environment but noted no immediate concerns affecting demand trends [67] Other Important Information - Non-GAAP gross profit for Q4 was $112 million, with a gross margin of 69.9%, up from 67.9% in the prior year [21][22] - The company plans to update guidance post-acquisition of Offerfit, which is expected to be dilutive to non-GAAP operating income margins in the fiscal year [26][28] Q&A Session Summary Question: Insights on Offerfit acquisition and AI agents - Management highlighted that Offerfit's technology excels in generating maximum uplift in marketing performance, which is crucial for high-end market customers [32][34] Question: Adjustments to guidance philosophy due to macro conditions - Management indicated that they have adapted to macro disruptions and will maintain a cautious guidance approach [37][38] Question: Next frontier of personalization - Management discussed the evolution of personalization strategies, emphasizing the importance of automated experimentation and AI-driven decision-making [42][46] Question: Expansion trends from new customer cohorts - Management confirmed that newer customer cohorts are performing better than previous cohorts, indicating positive expansion trends [52] Question: Business outcomes for customers using Offerfit - Management noted that Offerfit enhances message relevance and effectiveness, leading to better customer engagement outcomes [56][59] Question: Mix of cash and stock in the acquisition - The acquisition deal consists of 42% equity and the remainder in cash [61] Question: Demand trends and customer spending - Management reported no significant changes in demand trends despite macroeconomic uncertainties [67]