Backblaze(BLZE) - 2023 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company achieved Q4 revenue of $28.7 million, representing a 25% year-over-year increase [44] - Adjusted EBITDA reached 6%, exceeding the previous guidance of 3% [25][68] - Cash usage was reduced to$ 2.4 million, significantly lower than the $9 million used in the prior quarter [69] Business Line Data and Key Metrics Changes - B2 cloud storage revenue was$ 14 million, reflecting a 47% year-over-year growth [44] - Computer backup revenue totaled $14.7 million, showing a 10% growth [44] - Net revenue retention (NRR) for B2 cloud storage was 122%, while computer backup NRR was 100% [29] Market Data and Key Metrics Changes - The company noted a 1% to 2% decline in licensed usage in the quarter, but customer retention remained high at 91% [52][67] - The company is increasingly focusing on larger businesses, moving upmarket to capture more significant deals [5][40] Company Strategy and Development Direction - The company is committed to driving the open cloud ecosystem, emphasizing interoperability and affordability [26][34] - A new enterprise control feature was launched to help larger customers manage backups for multiple computers [28][36] - The company is enhancing its sales approach and building a channel program to support larger deals [38][40] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth potential in the open cloud market, driven by businesses seeking cost-effective and flexible solutions [34][42] - The company aims to achieve cash flow breakeven by mid-2025, with a forecast of at least$ 20 million in cash by year-end 2024 [70] Other Important Information - The company introduced a new Chief Product Officer to enhance innovation and strategic leadership [37] - The company is focused on AI-related use cases and has partnered with GPU cloud providers to support these initiatives [62][95] Q&A Session Summary Question: What is the expected impact of price increases on churn? - Management reported no significant increase in churn following the price increase, maintaining a strong customer retention rate [74][67] Question: How is the company finding new upmarket customers? - The company is leveraging content marketing, community engagement, and channel partnerships to attract media and entertainment customers [80] Question: What are the company's expectations for gross margin in 2024? - The company expects gross margin to be in the upper 70% range for the full year, an improvement attributed to price increases [93]