Backblaze(US:BLZE)2021-12-14 04:49Financial Data and Key Metrics Changes - Total revenue for Q3 2021 was $17.3 million, representing a 25% year-over-year increase [8][27] - B2 Cloud Storage revenue grew 59% to $6 million, while Computer Backup revenue increased 13% to $11.2 million [8][27] - Annual Recurring Revenue (ARR) totaled $71 million as of Q3 2021 [8] - Adjusted EBITDA was $0.8 million, down from $2.8 million the previous year, reflecting increased expenses for pre-IPO services and investments in sales and marketing [29][30] Business Line Data and Key Metrics Changes - B2 Cloud Storage accounted for 34.5% of total revenue, continuing its upward trend [27] - Computer Backup had an ARR of $46 million, while B2 Cloud Storage had an ARR of $25 million [11][12] - Net Revenue Retention (NRR) was 110% overall, with B2 at 129% and Computer Backup at 103% [28] Market Data and Key Metrics Changes - The public cloud storage market is projected to reach $91 billion by 2025 [10] - The mid-market segment, defined as companies with fewer than 1,000 employees, represents over 60% of this market, equating to a $55 billion revenue opportunity [14] Company Strategy and Development Direction - Backblaze aims to be the leading independent cloud for data storage, focusing solely on storage without competing with customers [6][7] - The company plans to utilize over $100 million from its IPO to accelerate growth and capitalize on market opportunities [21] - The strategy includes a dual go-to-market approach with self-serve and sales-assisted motions, with over 80% of customers acquired through self-serve [17][18] Management's Comments on Operating Environment and Future Outlook - Management believes the COVID-19 pandemic has accelerated the adoption of public cloud solutions, although it may cause short-term variability in new data creation [26] - The company expects Q4 2021 revenue to be between $17.7 million and $18.2 million, indicating a full-year growth of 24% to 25% [31] - Management remains optimistic about the growth potential, driven by new customer acquisition and expansion within the existing customer base [60] Other Important Information - Backblaze executed one of the largest directed share programs in U.S. capital markets history, inviting hundreds of thousands of customers to participate in the IPO [22] - The company has established partnerships with developers and alliance partners to enhance its service offerings and market reach [18][24] Q&A Session Summary Question: Go-to-market motion and direct sales force investments - Management discussed the scaling of the sales-assisted motion and the positive impact on pipeline visibility for the B2 business [34][35] Question: AWS competition and pricing strategies - Management highlighted the complexity of AWS's pricing and the ease of use of Backblaze's offerings as a key differentiator [40][41] Question: Revenue per customer trends - Management noted that revenue per customer is increasing, driven by larger customers and cross-selling opportunities [46][47] Question: Investments in branding and marketing - The company is investing in content engagement and paid advertising to raise brand awareness following the IPO [48][49] Question: Impact of price increase on customer retention - Management reported consistent gross customer retention despite a recent price increase for Computer Backup services [61]