Braze $BRZE Stock Surges 13% In After-hours On Kick-Butt Quarterly

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BRZE stock surged more than 13% in after-hours trading on December 20, 2021, after the company reported sweet beats and revenue growth in its latest quarterly filing.

Braze Reports Fiscal Third Quarter 2022 Results

On December 20, 2021, Braze (Nasdaq: BRZE) a leading comprehensive customer engagement platform that powers interactions between consumers and brands they love, announced results for its fiscal quarter ended October 31, 2021.

  1. Third quarter revenue grew 62.6% year-over-year to $64.0 million
  2. Achieved dollar-based net retention of 126% for the trailing 12 months
  3. Introduces fourth quarter and full year fiscal 2022 guidance

“Brands increasingly recognize that building direct relationships with customers through memorable and personalized experiences is essential for long-term success, and they’re turning to Braze to succeed at that imperative,” said Bill Magnuson, cofounder and CEO of Braze. “Exemplary execution combined with strong demand allowed us to deliver outstanding third quarter results, demonstrating high growth at scale. We are in the early stages of addressing a large market opportunity in the customer engagement space, and we believe Braze can help all brands create valuable customer experiences that drive growth and retention.”

Fiscal Third Quarter Financial Highlights

  1. Revenue was $64.0 million compared to $39.3 million in the third quarter of the fiscal year ended January 31, 2021, up 62.6% year-over year, driven primarily by new customers, upsells and renewals.
  2. Subscription revenue in the quarter was $59.3 million compared to $36.8 million in the third quarter of the fiscal year ended January 31, 2021, and professional services and other revenue was $4.7 million compared to $2.5 million in the third quarter of the fiscal year ended January 31, 2021.
  3. Remaining performance obligations as of October 31, 2021 was $304.0 million, of which $199.1 million is current.
  4. GAAP Gross Margin was 70.0% compared to 63.3% in the third quarter of the fiscal year ended January 31, 2021
  5. Non-GAAP Gross Margin was 70.3% compared to 63.8% in the third quarter of the fiscal year ended January 31, 2020.
  6. Dollar-based net retention for all customers for the trailing 12 months ended October 31, 2021 and October 31, 2020 was 126% and 124%, respectively; dollar-based net retention for customers with annual recurring revenue (ARR) of $500,000 or more was 136% compared to 134% in the third quarter of the fiscal year ended January 31, 2021.
  7. Total customers increased to 1,247 as of October 31, 2021 from 841 as of October 31, 2020; 97 of our customers had ARR of $500,000 or more as of October 31, 2021, compared to 67 customers as of October 31, 2020.
  8. GAAP operating loss was $10.4 million compared to a loss of $8.8 million in the third quarter of the fiscal year ended January 31, 2021.
  9. Non-GAAP operating loss was $5.0 million compared to a loss of $6.5 million in the third quarter of the fiscal year ended January 31, 2021.
  10. GAAP net loss per basic and diluted share attributable to Braze common stockholders was $(0.42) compared to $(0.47) in the third quarter of the fiscal year ended January 31, 2021.
  11. Non-GAAP net loss per basic and diluted share attributable to Braze common stockholders was $(0.16) compared to $(0.35) in the third quarter of the fiscal year ended January 31, 2021.
  12. Free cash flow was $(3.5) million compared to $(6.8) million in the third quarter of the fiscal year end January 31, 2021.
  13. Total cash and cash equivalents, restricted cash, and marketable securities was $80.9 million as of October 31, 2021 compared to $91.0 million as of October 31, 2020.

Recent Business Highlights

  1. Recognized as a leader in The Forrester Wave™: Cross-Channel Campaign Management (Independent Platforms), Q3 2021 report; Braze received the highest score of all vendors in the Strategy category.
  2. Continued to acquire talent, growing headcount by more than 300 employees year-to-date this fiscal year, bringing the total Braze team to over 1,000 as of the end of the third fiscal quarter.
  3. Named one of the Best Places to Work in NYC by Crains; named one of the Best Medium-Sized Workplaces by Fortune and Great Places to Work; named a 2021 U.K. Best Workplaces for Women; and ranked #23 on the Forbes Cloud 100 list.
  4. Completed its initial public offering of 8,800,000 shares of Braze’s Class A common stock at a price to the public of $65.00 per share, which consisted of 7,500,000 shares issued and sold by Braze and 1,300,000 shares sold by the selling stockholders. Net proceeds to Braze from the initial public offering totaled approximately $457.1 million, and Braze did not receive any proceeds from the shares sold by the selling stockholders.

Braze initiated with an Overweight at Barclays

On December 14, 2021, Barclays analyst Raimo Lenschow initiated coverage of Braze with an Overweight rating and $95 price target. The analyst says Braze’s “differentiated” business-to-consumer customer engagement platform can drive a 40%-plus revenue growth annually through fiscal 2024.

Braze initiated with a Buy at Loop Capital

On December 13, 2021, Loop Capital analyst Yun Kim initiated coverage of Braze with a Buy rating and $90 price target. The company is emerging as one of the leaders in the marketing automation software industry that is currently undergoing a secular replacement cycle of a first-generation, email-based marketing platform to a real-time, multi-channel one with capacity to provide personalization at scale, the analyst tells investors in a research note. “Strong secular tailwind” is driving Braze’s current 40% revenue growth rate at a $200M+ annual revenue run rate, with the stock offering “one of the fastest growth stories in software today”, Kim adds.

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📈 BRZE Stock Technical Analysis

Brze Stock

BRZE is one of the lesser performing stocks in the Software industry. 100% of 346 stocks in the same industry do better. There is resistance at 69.99 from a horizontal line in the daily time frame. Although the technical rating is bad, BRZE does present a nice setup opportunity. Prices have been consolidating lately. There is very little resistance above the current price. Click here to sign up for email alerts on when BRZE stock is a good long entry.

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