Braze (BRZE) Q3 2025 earnings summary

Executive summary

• Revenue reached $152.1 million for the quarter, up 22.7% year-over-year, with international revenue comprising 45% of total and customer count rising to 2,211, including 234 with ARR of $500,000+.

• Non-GAAP net income per share was $0.02, compared to a non-GAAP net loss per share of $0.05 a year ago; GAAP net loss per share improved to $0.27 from $0.31.

• Free cash flow was $(14.2) million for the quarter, but turned positive at $4.4 million for the nine months ended October 31, 2024.

• Notable new business wins, product innovations including AI-driven features, and recognition as a leader in Gartner's Magic Quadrant for Multichannel Marketing Hubs.

• Company remains on track to meet profitability targets for Q4 and full fiscal year 2025.

Financial highlights

• Subscription revenue comprised 96% of total revenue, reaching $146.3 million, with professional services and onboarding fees making up the remaining 4%.

• Non-GAAP gross margin was 70.5%, while GAAP gross margin was 69.8%, slightly down year-over-year.

• Non-GAAP operating loss narrowed to $2.2 million from $8.9 million year-over-year; GAAP operating loss was $32.6 million.

• Cash, cash equivalents, and marketable securities totaled $493.1 million as of October 31, 2024.

• Dollar-based net retention rate was 113% overall and 116% for large customers ($500,000+ ARR).

Outlook and guidance

• Q4 FY25 revenue guidance: $155.0–$156.0 million; non-GAAP net income per share: $0.05–$0.06.

• FY25 revenue guidance: $588.0–$589.0 million; non-GAAP net income per share: $0.10–$0.11.

• Weighted average shares outstanding projected at ~107.5 million for Q4 and ~107.0 million for FY25.

• Management expects continued revenue growth through customer expansion, international penetration, and product innovation, but notes macroeconomic uncertainty may impact renewal rates and customer spending.

• Current liquidity is expected to be sufficient for at least the next 12 months, with no immediate need for additional capital.