On December 6, 2023, Braze Inc (BRZE, Financial) released its 8-K filing, announcing financial results for the fiscal third quarter ended October 31, 2023. The company, a leader in customer engagement platforms, reported a significant year-over-year revenue increase of 33.1%, reaching $124.0 million, primarily driven by new customer acquisitions, upsells, and renewals.
Fiscal Third Quarter 2024 Performance
Braze Inc (BRZE, Financial) demonstrated robust financial performance in the third quarter of fiscal 2024, with subscription revenue climbing to $118.4 million from $89.0 million in the prior year. Professional services and other revenue also saw an increase to $5.6 million, compared to $4.1 million in the same quarter of the previous fiscal year. The company's remaining performance obligations stood at $560.1 million, with $369.9 million being current.
Improvements in operational efficiency were evident as GAAP Gross Margin rose to 70.7% from 68.7%, and Non-GAAP Gross Margin increased to 71.4% from 69.7%. The dollar-based net retention rate for all customers was 118%, although this marked a decrease from 126% in the previous year. Notably, the company grew its customer base to 2,011, up from 1,715 year-over-year, with 189 customers contributing annual recurring revenue (ARR) of $500,000 or more.
Income Statement and Balance Sheet Highlights
The GAAP operating loss was reduced to $35.1 million, down from a loss of $36.9 million in the same quarter of the previous fiscal year. This included $24.0 million in stock-based compensation expense. The Non-GAAP operating loss also saw a significant reduction to $8.9 million from a loss of $17.3 million. The GAAP net loss per share attributable to Braze common stockholders improved to $0.31, compared to $0.35, and the Non-GAAP net loss per share improved to $0.05, compared to $0.15.
From a liquidity perspective, Braze Inc (BRZE, Financial) reported net cash used in operating activities at $2.0 million, a substantial improvement from $23.9 million used in the prior year. Free cash flow was also better at $(5.9) million compared to $(28.1) million. Total cash and cash equivalents, restricted cash, and marketable securities were reported at $471.9 million as of October 31, 2023.
Outlook and Commentary
Looking ahead, Braze Inc (BRZE, Financial) is initiating guidance for the fiscal fourth quarter ending January 31, 2024, with revenue expected to be between $124.0 and $125.0 million. The company is also updating its full-year guidance, anticipating a non-GAAP operating loss margin of negative 6% or better.
We delivered another strong quarter, demonstrating our ability to balance high growth with operational efficiency," said Bill Magnuson, cofounder and CEO of Braze. "We are confidently on track to meet our profitability targets for the fourth quarter of fiscal 2024 and for fiscal 2025. Our focus remains on propelling our technology forward and empowering brands to execute meaningful customer experiences at scale."
Recent business highlights include new business wins and upsells with notable companies, the introduction of new AI solutions, and recognition by Deloitte and Gartner as a leader in their respective assessments. Braze Inc (BRZE, Financial) also deepened its relationship with AWS, achieving the new AWS Advertising and Marketing Technology Competency.
Investors and stakeholders can access more detailed financial information and a replay of the financial results conference call on Braze’s investor site at investors.braze.com.
For a comprehensive understanding of Braze Inc (BRZE, Financial)'s financial performance, including reconciliations of non-GAAP financial measures, readers are encouraged to review the full 8-K filing.
Explore the complete 8-K earnings release (here) from Braze Inc for further details.
