Braze (BRZE) Q2 2025 earnings summary

Executive summary

• Revenue reached $145.5M in Q2 FY25, up 26.4% year-over-year, with customer count growing to 2,163 and 222 customers over $500K ARR, driven by new wins and product innovation, especially in AI and data platform capabilities.

• Achieved first-ever quarter of non-GAAP operating and net income profitability, reflecting improved efficiency and operating leverage.

• Notable new business wins included Asiana Airlines, Bell Media, Papa Johns Pizza, Gumtree, LoanDepot, Strawberry Hotels, Supercell, TF1, and Zalando.

• Launched Braze Data Platform, Braze for Startups, and a 14-day free trial, and recognized as a Strong Performer by Forrester.

• International revenue expanded, now representing 45% of total revenue, with continued expansion in large enterprise accounts.

Financial highlights

• Q2 revenue was $145.5M, up 26.4% year-over-year; subscription revenue comprised 96% of total.

• Non-GAAP gross margin improved to 70.9%, up 90 basis points year-over-year; GAAP gross margin was 70.2%.

• Non-GAAP operating income was $4.2M (2.9% margin), compared to a loss of $7.6M last year; GAAP operating loss was $28.0M.

• Non-GAAP net income was $9.1M ($0.09/share), versus a loss of $3.9M ($0.04/share) last year; GAAP net loss per share was $0.23.

• Free cash flow was $7.2M for the quarter, up from $(18.7)M last year; operating cash flow for six months was $31.0M.

Outlook and guidance

• Q3 FY25 revenue expected at $147.5M–$148.5M; non-GAAP operating loss of $3.5M–$4.5M due to event costs.

• Full-year FY25 revenue guidance is $582.5M–$585.5M; non-GAAP operating loss of $7.5M–$8.5M.

• FY25 non-GAAP net income expected at $6.5M–$7.5M ($0.06–$0.07/share).

• Management expects continued investment in sales, marketing, and R&D to drive long-term growth.

• Current liquidity of $504.5M in cash, cash equivalents, and marketable securities is expected to cover working capital and capital expenditures for at least the next 12 months.