Backblaze Earnings Call Transcripts
Fiscal Year 2026
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The meeting established a quorum, approved the election of a Class two director for a three-year term, and ratified the independent auditor. Final voting results will be filed with the SEC.
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Cloud storage revenue is accelerating, fueled by AI sector demand and rapid product innovation. Go-to-market transformation and a new CRO are driving larger deals and improved pipeline predictability, while internal AI adoption and strong supply chain management support scalable growth.
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Q1 revenue and EBITDA exceeded guidance, driven by 24% B2 growth and strong AI demand. Full-year guidance was raised, with continued momentum in large deals, improved margins, and a focus on the expanding Neocloud and AI storage markets.
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Network traffic analysis revealed dynamic, high-bandwidth NeoCloud and hyperscaler flows, especially in US East, driving upgrades to 400Gbps+ links. Regional patterns and new geo-data inform expansion, while steady CDN and ISP traffic aid planning.
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Revenue growth and free cash flow margins have improved significantly, driven by B2 Cloud Storage and new product launches targeting MSPs and Neocloud providers. The Neocloud market presents a $14B opportunity, with strategic deals and a doubling pipeline supporting ambitious growth targets.
Fiscal Year 2025
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Revenue and adjusted EBITDA margin met or exceeded guidance, with strong B2 Cloud Storage growth and first-time adjusted free cash flow profitability. Launched B2 Neo and signed a $15M+ neocloud deal, while guiding for stable growth and margin discipline in 2026.
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Revenue and Adjusted EBITDA margin exceeded guidance, with B2 Cloud Storage up 28% year-over-year. The company is on track for positive adjusted free cash flow in Q4, driven by AI demand and ongoing go-to-market transformation.
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Q2 saw 16% revenue growth and a doubling of adjusted EBITDA margin, driven by strong B2 Cloud Storage performance and rapid AI customer adoption. Guidance was raised for the year, with continued innovation and upmarket momentum supporting future growth.
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The company is expanding its high-performance, low-cost cloud storage offerings, with recent innovations like Overdrive and Shard Stash targeting AI and large data workloads. Strong customer retention, growing OEM and channel partnerships, and a focus on operational efficiency are driving sequential growth, with AI use cases providing significant momentum.
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Q1 revenue grew 15% year-over-year, with B2 Cloud Storage up 23% and adjusted EBITDA margin tripling to 18%. The company launched B2 Overdrive, signed its largest TCV deal, and raised full-year margin guidance, while AI use cases drove rapid growth.
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Cloud storage is now the main growth engine, surpassing legacy backup, with ARR up 22% year over year. Strategic focus includes upskilling, deeper partnerships, and targeting high-growth sectors like AI, aiming for 30% B2 growth and zero free cash flow margin by Q4 2025.
Fiscal Year 2024
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Q4 revenue grew 18% year-over-year, led by 22% B2 Cloud Storage growth and a doubling of Adjusted EBITDA margin. The company projects B2 growth to exceed 30% by end of 2025, with a focus on profitability and free cash flow, while AI and enterprise segments drive momentum.
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Q3 revenue grew 29% year-over-year, with B2 cloud storage up 39% and record adjusted EBITDA margin of 12%. Cost reductions, including a 12% workforce cut, are being reinvested in sales, with positive free cash flow targeted by Q4 2025.
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Q2 revenue grew 27% year-over-year, with B2 Cloud Storage up 43% and Computer Backup up 15%. Adjusted EBITDA reached $2.7 million, and guidance for both revenue and margins was raised for the year. Upmarket momentum, innovation, and strong retention drove results.