Backblaze (BLZE) Q2 2024 earnings summary

Executive summary

• Achieved 27% year-over-year revenue growth in Q2 2024 to $31.3 million, with B2 Cloud Storage up 43% and Computer Backup up 15%.

• Adjusted EBITDA was $2.7 million (9% margin), marking the third consecutive quarter of profitability and a turnaround from a loss in Q2 2023.

• Gross margin improved to 55% (GAAP) and 78% (adjusted), both all-time highs, driven by price increases and data center optimization.

• Net loss narrowed to $10.3 million from $14.3 million in Q2 2023; non-GAAP net loss improved to $4.8 million.

• Welcomed new Chief Revenue Officer and announced incoming CFO, supporting strategic growth and operational efficiency.

Financial highlights

• Q2 2024 revenue: $31.3 million (+27% YoY); B2 Cloud Storage revenue: $15.4 million (+43% YoY); Computer Backup revenue: $15.9 million (+15% YoY).

• Adjusted gross margin: 78% in Q2 2024, up from 74%-75% in Q2 2023.

• ARR reached $126.3 million for the company, with B2 Cloud Storage ARR at $62.8 million and Computer Backup ARR at $63.5 million.

• Cash, investments, and restricted cash at quarter end totaled $28.3 million.

• Operating cash flow for the first half of 2024 was $5.6 million, up from $(10.4) million in 2023.

Outlook and guidance

• Q3 2024 revenue expected between $32.4 million and $32.8 million; adjusted EBITDA margin forecasted at 9%-11%.

• Full-year 2024 revenue guidance raised to $126.5-$128.5 million, with B2 Cloud Storage growth projected at ~40%.

• Adjusted EBITDA margin for the year now expected at 9%-11%, up from prior 8%-10%.

• Management expects continued favorable impact on revenue and gross margin from 2023 price increases through 2024.

• Plans to invest in infrastructure and international expansion to support growth.