Braze (NASDAQ:BRZE) the leading customer engagement platform that empowers brands to Be Absolutely Engaging™, today announced results for its fiscal quarter ended October 31, 2024.

"We continued to execute in the third quarter, delivering strong revenue growth and operating leverage while maintaining steady investment in our product, our ecosystem, and our go-to-market motion to continue positioning Braze as the leading cross-channel customer engagement platform," said Bill Magnuson, Cofounder and CEO of Braze. "We are confidently on track to meet our profitability targets for the fiscal fourth quarter of and full fiscal year 2025, and continue to focus on driving growth through customer engagement innovations that empower our customers to create more valuable customer experiences."

Fiscal Third Quarter 2025 Financial Highlights

Revenue was $152.1 million compared to $124.0 million in the third quarter of the fiscal year ended January 31, 2024, up 22.7% year-over-year, driven primarily by new customers, upsells and renewals.
Subscription revenue in the quarter was $146.3 million compared to $118.4 million in the third quarter of the fiscal year ended January 31, 2024, and professional services and other revenue was $5.8 million compared to $5.6 million in the third quarter of the fiscal year ended January 31, 2024.
Remaining performance obligations as of October 31, 2024 was $716.8 million, of which $458.2 million is current, which the company defines as less than one year.
GAAP gross margin was 69.8% compared to 70.7% in the third quarter of the fiscal year ended January 31, 2024.
Non-GAAP gross margin was 70.5% compared to 71.4% in the third quarter of the fiscal year ended January 31, 2024.
Dollar-based net retention for all customers for the trailing 12 months ended October 31, 2024 and October 31, 2023 was 113% and 118%, respectively; dollar-based net retention for customers with annual recurring revenue (ARR) of $500,000 or more was 116% compared to 121% in the third quarter of the fiscal year ended January 31, 2024.
Total customers increased to 2,211 as of October 31, 2024 from 2,011 as of October 31, 2023; 234 of the company's customers had ARR of $500,000 or more as of October 31, 2024, compared to 189 customers as of October 31, 2023.
GAAP operating loss was $32.6 million compared to an operating loss of $35.1 million in the third quarter of the fiscal year ended January 31, 2024. A primary contributor to the operating loss in the quarter included $28.3 million of stock-based compensation expense.
Non-GAAP operating loss was $2.2 million compared to a loss of $8.9 million in the third quarter of the fiscal year ended January 31, 2024.
GAAP net loss per share attributable to Braze common stockholders, basic and diluted, of $0.27 based on 102.1 million weighted average shares outstanding in the third quarter of fiscal year ended January 31, 2025, compared to GAAP net loss per share attributable to Braze common stockholders, basic and diluted, of $0.31, based on 97.9 million weighted average shares outstanding in the third quarter of the fiscal year ended January 31, 2024.
Non-GAAP net income per share attributable to Braze common stockholders, diluted, was $0.02 based on 106.8 million weighted average shares outstanding in the third quarter of fiscal year ended January 31, 2025, compared to non-GAAP net loss per share attributable to Braze common stockholders, basic and diluted, of $0.05 based on 97.9 million weighted average shares outstanding in the third quarter of the fiscal year ended January 31, 2024.
Net cash used in operating activities was $11.4 million compared to net cash used in operating activities of $2.0 million in the third quarter of the fiscal year end January 31, 2024.
Free cash flow was $(14.2) million compared to $(5.9) million in the third quarter of the fiscal year end January 31, 2024.
Total cash and cash equivalents, restricted cash, and marketable securities was $493.1 million as of October 31, 2024 compared to $480.0 million as of January 31, 2024.

Recent Business Highlights

Notable new business wins and upsells in the quarter included AEON Financial Services Co. Ltd, Burpple, Crumbl Cookies, E.On Next, Exact Sciences, Hugo Boss, Ippen Digital, Kurt Geiger, Love's Travel Stops & Country Stores, LUSH Cosmetics, Rightmove, SMARTNEWS, INC., Telstra, and WeatherBug, a leading consumer weather company, along with many others.
Hosted over 1,000 attendees, including over 750 customers and prospects, and nearly 250 partners at its annual customer conference, Forge 2024, in Las Vegas.
Announced BrazeAI™ agent, codenamed Project Catalyst (in development), designed to deliver 1:1 customer engagement by rapidly creating, testing, and optimizing thousands of experience variations.
Debuted additional Canvas template and BrazeAI™ assistant features to help marketers more easily start and deliver sophisticated customer experiences.
Expanded channel offerings to include LINE (generally available now) and RCS Business (in Beta), as well as new WhatsApp features such as dynamic images, click tracking, and commerce support.
Named a Leader in the 2024 Gartner® Magic Quadrant™ for Multichannel Marketing Hubs for second consecutive year.
For the third consecutive year, Braze was named by Deloitte as one of the fastest growing technology, media, telecommunications, life sciences, fintech, and energy tech companies in North America in the 2024 Deloitte Technology Fast 500™.
Partnered with streaming network BET+ to help expand the Braze Tech for an Equitable Future product grant program, which offers 20 companies with underrepresented founders 12 months of free access to Braze technology and supporting resources.

Financial Outlook

Braze is initiating guidance for the fiscal fourth quarter ending January 31, 2025 and updating guidance for the fiscal year ending January 31, 2025.

Metric (in millions, except per share amounts)	FY 2025 Q4 Guidance	FY 2025 Guidance
Revenue	$155.0 - 156.0	$588.0 - 589.0
Non-GAAP operating income (loss)	$2.0 - 3.0	$(5.0) - (6.0)
Non-GAAP net income	$5.0 - 6.0	$11.0 - 12.0
Non-GAAP net income per share, diluted	$0.05 - 0.06	$0.10 - 0.11
Weighted average common shares used in computing non-GAAP net income per share, diluted	~107.5	~107.0

Braze has not reconciled its guidance as to non-GAAP operating income (loss), non-GAAP net income or non-GAAP net income per share to their most directly comparable GAAP measure as a result of uncertainty regarding, and the potential variability of, reconciling items such as stock-based compensation expense specific to equity compensation awards that are directly impacted by unpredictable fluctuations in Braze's stock price. Accordingly, reconciliations are not available without unreasonable effort, although it is important to note that these factors could be material to Braze's results calculated in accordance with GAAP.

Conference Call Information:

What: Braze Third Quarter Fiscal Year 2025 Financial Results Conference Call

When: Monday, December 9th at 4:30 pm EST / 1:30 pm PST

Webcast & Supplemental Data: investors.braze.com

Replay: A webcast replay will be available on Braze's investor site at investors.braze.com.

Supplemental and Other Financial Information

Supplemental information, including an accompanying financial presentation and other information can be accessed through Braze's investor website at investors.braze.com.

Non-GAAP Financial Measures

This press release and the accompanying tables contain the following non-GAAP financial measures: non-GAAP gross profit and margin, non-GAAP sales and marketing expense, non-GAAP research and development expense, non-GAAP general and administrative expense, non-GAAP operating income (loss), non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per share, basic and diluted, and non-GAAP free cash flow. Braze defines non-GAAP gross profit and margin, non-GAAP sales and marketing expense, non-GAAP research and development expense, non-GAAP general and administrative expense, non-GAAP operating income (loss), non-GAAP operating margin, and non-GAAP net income (loss) as the respective GAAP balances, adjusted for stock-based compensation expense, employer taxes related to stock-based compensation, charitable contribution expense, contingent consideration adjustments, acquisition related expense, amortization of intangible assets, and restructuring expense. Prior to the fourth quarter of the fiscal year ended January 31, 2024, Braze did not adjust non-GAAP gross profit and margin, non-GAAP sales and marketing expense, non-GAAP research and development expense, non-GAAP general and administrative expense, non-GAAP operating income (loss), non-GAAP operating margin or non-GAAP net income (loss) for contingent consideration adjustments, because there were no such adjustments in prior periods. Braze defines non-GAAP free cash flow as net cash provided by/(used in) operating activities, minus purchases of property and equipment and minus capitalized internal-use software costs. Investors are encouraged to review the reconciliation of these historical non-GAAP financial measures to their most directly comparable GAAP financial measures.

Braze uses this non-GAAP financial information internally in analyzing its financial results and believes that this non-GAAP financial information, when taken collectively with GAAP financial measures, may be helpful to investors because it provides consistency and comparability with past financial performance and assists in comparisons with other companies, some of which use similar non-GAAP financial information to supplement their GAAP results. The non-GAAP financial information is presented for supplemental informational purposes only, and should not be considered a substitute for financial information presented in accordance with generally accepted accounting principles in the United States (GAAP), and may be different from similarly-titled non-GAAP measures used by other companies.

The principal limitation of these non-GAAP financial measures is that they exclude significant expenses that are required by GAAP to be recorded in Braze's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by Braze's management about which expenses are excluded or included in determining these non-GAAP financial measures. A reconciliation is provided below in the financial statement tables included below in this press release for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP.

Braze encourages investors to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures, which it includes in press releases announcing quarterly and fiscal year financial results, including this press release, and not to rely on any single financial measure to evaluate Braze's business.

Definition of Other Business Metrics

Customer: Braze defines a customer, as of period end, as the separate and distinct, ultimate parent-level entity that has an active subscription with Braze to use its products. A single organization could have multiple distinct contracting divisions or subsidiaries, all of which together would be considered a single customer.

Annual Recurring Revenue (ARR): Braze defines ARR as the annualized value of customer subscription contracts, including certain premium professional services that are subject to contractual subscription terms, as of the measurement date, assuming any contract that expires during the next 12 months is renewed on its existing terms (including contracts for which Braze is negotiating a renewal). Braze's calculation of ARR is not adjusted for the impact of any known or projected future events (such as customer cancellations, expansion or contraction of existing customers relationships or price increases or decreases) that may cause any such contract not to be renewed on its existing terms. ARR may decline or fluctuate as a result of a number of factors, including customers' satisfaction or dissatisfaction with Braze's products and professional services, pricing, competitive offerings, economic conditions or overall changes in Braze's customers' spending levels. ARR should be viewed independently of revenue and does not represent Braze's GAAP revenue on an annualized basis or a forecast of revenue, as it is an operating metric that can be impacted by contract start and end dates and renewal rates.

Dollar-Based Net Retention Rate: Braze calculates dollar-based net retention rate as of a period end by starting with the ARR from a cohort of customers as of 12 months prior to such period-end (the Prior Period ARR). Braze then calculates the ARR from the same cohort of customers as of the end of the current period (the Current Period ARR). Current Period ARR includes any expansion and is net of contraction or attrition over the last 12 months, but excludes ARR from new customers in the current period. Braze then divides the total Current Period ARR by the total Prior Period ARR to arrive at the point-in-time dollar-based net retention rate. Braze then calculates the weighted average point-in-time dollar-based net retention rates as of the last day of each month in the current trailing 12-month period to arrive at the dollar-based net retention rate.

Remaining Performance Obligations: The transaction price allocated to remaining performance obligations represents amounts under non-cancelable contracts expected to be recognized as revenue in future periods, and may be influenced by several factors, including seasonality, the timing of renewals, the timing of service delivery and contract terms. Unbilled portions of the remaining performance obligation are subject to future economic risks including bankruptcies, regulatory changes and other market factors.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding Braze's financial outlook for the fourth quarter of and the full fiscal year ended January 31, 2025. These forward-looking statements are based on current expectations, estimates, forecasts and projections. Words such as "anticipate," "believe," "could," "estimate," "expect," "goal," "hope," "intend," "may," might," "potential," "predict," "project," "shall," "should," "target," "will," and variations of these terms and similar expressions are intended to identify these forward-looking statements, although not all forward-looking statements contain these identifying words.

Forward-looking statements are based on Braze's current assumptions, expectations and beliefs and are subject to substantial risks, uncertainties, assumptions and changes in circumstances that may cause Braze's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks include, but are not limited to, risks and uncertainties related to: (1) unstable market and economic conditions may have serious adverse consequences on Braze's business, financial condition and share price; (2) Braze's recent rapid revenue growth may not be indicative of its future revenue growth; (3) Braze's history of operating losses; (4) Braze's limited operating history at its current scale; (5) Braze's ability to successfully manage its growth; (6) the accuracy of estimates of market opportunity and forecasts of market growth and the impact of global and domestic socioeconomic events on Braze's business; (7) Braze's ability and the ability of its platform to adapt and respond to changing customer or consumer needs, requirements or preferences; (8) Braze's ability to attract new customers and renew existing customers; (9) the competitive markets in which Braze participates and the intense competition that it faces; (10) Braze's ability to adapt and respond effectively to rapidly changing technology, evolving cybersecurity and data privacy risks, evolving industry standards or changing regulations; and (11) Braze's reliance on third-party providers of cloud-based infrastructure; as well as other risks and uncertainties discussed in the "Risk Factors" section of Braze's Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) on April 1, 2024 and other subsequent filings Braze makes with the SEC from time to time, including Braze's Quarterly Report on Form 10-Q for the fiscal quarter ended October 31, 2024 that will be filed with the SEC. The forward-looking statements included in this press release represent Braze's views only as of the date of this press release and Braze assumes no obligation, and does not intend to update these forward-looking statements, except as required by law.

About Braze

Braze is the leading customer engagement platform that empowers brands to Be Absolutely Engaging.™ Braze allows any marketer to collect and take action on any amount of data from any source, so they can creatively engage with customers in real time, across channels from one platform. From cross-channel messaging and journey orchestration to Al-powered experimentation and optimization, Braze enables companies to build and maintain absolutely engaging relationships with their customers that foster growth and loyalty. The company has been recognized as a 2024 U.S. News Best Technology Companies to Work For, is a 2023 UK Best Workplace for Women by Great Place to Work, and was named a Leader by Gartner® in the 2024 Magic Quadrant™ for Multichannel Marketing Hubs and in The Forrester Wave™: Cross-Channel Marketing Hubs, Q1 2023. Braze is headquartered in New York with 10+ offices across North America, Europe, and APAC. Learn more at braze.com.

Braze uses its Investor website at investors.braze.com as a means of disclosing material non-public information, announcing upcoming investor conferences and for complying with its disclosure obligations under Regulation FD. Accordingly, you should monitor its investor relations website in addition to following its press releases, blog posts on its website (braze.com), SEC filings and public conference calls and webcasts.

Selected Financial Data

BRAZE, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (in thousands, except per share amounts)

	Three Months Ended October 31,						Nine Months Ended October 31,
		2024			2023			2024			2023

Revenue	$	152,052		$	123,956		$	433,010		$	340,843
Cost of revenue ⁽¹⁾⁽²⁾		45,910			36,374			133,878			104,535
Gross profit		106,142			87,582			299,132			236,308

Operating expenses:
Sales and marketing ^(1)(2)(6)		74,658			66,395			213,054			184,074
Research and development ⁽¹⁾⁽²⁾		32,855			29,872			100,369			88,749
General and administrative ^{(1)(2)(3)(4)(5)(6)(7)}		31,199			26,448			86,309			75,884
Total operating expenses		138,712			122,715			399,732			348,707
Loss from operations		(32,570	)		(35,133	)		(100,600	)		(112,399	)
Other income, net		5,294			4,542			15,968			11,866
Loss before provision for income taxes		(27,276	)		(30,591	)		(84,632	)		(100,533	)
Provision for income taxes		851			385			2,351			1,318
Net loss		(28,127	)		(30,976	)		(86,983	)		(101,851	)
Net loss attributable to redeemable non-controlling interest		(216	)		(235	)		(432	)		(962	)
Net loss attributable to Braze, Inc.	$	(27,911	)	$	(30,741	)	$	(86,551	)	$	(100,889	)

Net loss per share attributable to Braze, Inc. common stockholders, basic and diluted	$	(0.27	)	$	(0.31	)	$	(0.85	)	$	(1.03	)
Weighted-average shares used to compute net loss per share attributable to Braze, Inc. common stockholders, basic and diluted		102,146			97,880			101,714			97,615

⁽¹⁾ Includes stock-based compensation as follows:

	Three Months Ended October 31,				Nine Months Ended October 31,
		2024		2023		2024		2023
Cost of revenue	$	1,003	$	900	$	3,045	$	2,690
Sales and marketing		9,608		7,899		28,945		23,554
Research and development		10,343		9,479		32,623		29,251
General and administrative		7,364		5,761		21,805		17,466
Total stock-based compensation expense	$	28,318	$	24,039	$	86,418	$	72,961

⁽²⁾ Includes employer taxes related to stock-based compensation as follows:

	Three Months Ended October 31,				Nine Months Ended October 31,
		2024		2023		2024		2023
Cost of revenue	$	42	$	29	$	156	$	81
Sales and marketing		247		245		1,070		609
Research and development		220		199		1,400		721
General and administrative		127		84		567		239
Total employer taxes related to stock-based compensation expense	$	636	$	557	$	3,193	$	1,650

⁽³⁾ Includes 1% Pledge charitable donation expense as follows:

	Three Months Ended October 31,				Nine Months Ended October 31,
		2024		2023		2024		2023
General and administrative	$	1,417	$	1,427	$	2,764	$	2,391

⁽⁴⁾ Includes acquisition related expense as follows:

	Three Months Ended October 31,				Nine Months Ended October 31,
		2024		2023		2024		2023
General and administrative	$	—	$	—	$	—	$	1,946

⁽⁵⁾ Includes amortization of intangible assets acquired in the acquisition expense as follows:

	Three Months Ended October 31,				Nine Months Ended October 31,
		2024		2023		2024		2023
General and administrative	$	101	$	215	$	459	$	363

⁽⁶⁾ Includes restructuring related expense as follows:

	Three Months Ended October 31,				Nine Months Ended October 31,
		2024		2023		2024		2023
Sales and marketing	$	—	$	—	$	—	$	541
General and administrative		—		—		—	$	103
Total restructuring costs	$	—	$	—	$	—	$	644

⁽⁷⁾ Includes adjustment to the fair value of the contingent consideration liability as follows:

	Three Months Ended October 31,					Nine Months Ended October 31,
		2024			2023		2024			2023
General and administrative	$	(86	)	$	—	$	(223	)	$	—

BRAZE, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands, except share and per share amounts)

	October 31, 2024			January 31, 2024
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	61,312		$	68,228
Restricted cash, current		—			3,373
Accounts receivable, net of allowance of $2,696 and $2,772 at October 31, 2024 and January 31, 2024, respectively		90,299			92,256
Marketable securities		431,258			407,898
Prepaid expenses and other current assets		30,452			29,366
Total current assets		613,321			601,121
Restricted cash, noncurrent		530			530
Property and equipment, net		39,910			29,358
Operating lease right-of-use assets		80,352			81,163
Deferred contract costs		72,388			63,661
Goodwill		28,448			28,448
Intangible assets, net		3,231			3,690
Other assets		3,832			2,970
TOTAL ASSETS	$	842,012		$	810,941
LIABILITIES, REDEEMABLE NON-CONTROLLING INTEREST, AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable	$	2,912		$	6,321
Accrued expenses and other current liabilities		63,322			63,264
Deferred revenue		223,682			204,269
Operating lease liabilities, current		18,315			15,585
Total current liabilities		308,231			289,439
Operating lease liabilities, noncurrent		73,768			75,027
Other long-term liabilities		2,200			2,050
TOTAL LIABILITIES		384,199			366,516
COMMITMENTS AND CONTINGENCIES (Note 13)
Redeemable non-controlling interest (Note 4)		(240	)		192
STOCKHOLDERS' EQUITY
Class A common stock, $0.0001 par value; 2,000,000,000 and 2,000,000,000 shares authorized as of October 31, 2024 and January 31, 2024, respectively; 82,534,449 and 73,037,015 shares issued and outstanding as of October 31, 2024 and January 31, 2024, respectively		8			7
Class B common stock, $0.0001 par value; 110,000,000 and 110,000,000 shares authorized as of October 31, 2024 and January 31, 2024, respectively; 20,296,274 and 27,173,408 shares issued and outstanding as of October 31, 2024 and January 31, 2024, respectively		2			3
Additional paid-in capital		1,027,339			928,494
Accumulated other comprehensive loss		348			(1,178	)
Accumulated deficit		(569,644	)		(483,093	)
TOTAL STOCKHOLDERS' EQUITY		458,053			444,233
TOTAL LIABILITIES, REDEEMABLE NON-CONTROLLING INTEREST, AND STOCKHOLDERS' EQUITY	$	842,012		$	810,941

BRAZE, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands)

	Nine Months Ended October 31,
		2024			2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss (including amounts attributable to redeemable non-controlling interests)	$	(86,983	)	$	(101,851	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Stock-based compensation		87,184			72,961
Amortization of deferred contract costs		26,004			21,684
Depreciation and amortization		7,368			5,082
Provision for credit losses		2,157			1,717
Value of common stock donated to charity		2,764			2,391
(Accretion) amortization of (discount) premium on marketable securities		(1,605	)		1,579
Non-cash foreign exchange loss		(802	)		473
Fair value adjustments to contingent consideration		(223	)		—
Fixed asset write offs		436			128
Other		1			8
Changes in operating assets and liabilities:
Accounts receivable		(227	)		7,269
Prepaid expenses and other current assets		(1,365	)		1,946
Deferred contract costs		(34,764	)		(32,609	)
ROU assets and liabilities		2,123			1,903
Other assets		(506	)		(324	)
Accounts payable		(3,326	)		2,859
Accrued expenses and other current liabilities		2,105			9,321
Deferred revenue		19,517			8,363
Other long-term liabilities		(261	)		129
Net cash provided by operating activities		19,597			3,029
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for acquisition, net of cash acquired		—			(16,319	)
Purchases of property and equipment		(12,147	)		(3,439	)
Capitalized internal-use software costs		(3,023	)		(2,536	)
Purchases of marketable securities		(179,545	)		(191,922	)
Maturities of marketable securities		159,086			194,737
Net cash used in investing activities		(35,629	)		(19,479	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of common stock options		3,682			5,949
Proceeds from stock associated with employee stock purchase plan		4,752			3,222
Payments of deferred purchase consideration		(2,916	)		(165	)
Net cash provided by financing activities		5,518			9,006
Effect of foreign currency exchange rate changes on cash, cash equivalents, and restricted cash		225			(806	)
Net change in cash, cash equivalents, and restricted cash		(10,289	)		(8,250	)
Cash, cash equivalents, and restricted cash, beginning of period		72,131			72,623
Cash, cash equivalents, and restricted cash, end of period	$	61,842		$	64,373

BRAZE, INC. U.S. GAAP RECONCILIATION OF NON-GAAP ADJUSTED RESULTS (in thousands, except per share amounts)

The following tables reconcile each non-GAAP financial measure to its most directly comparable GAAP financial measure:

Reconciliation of GAAP to Non-GAAP Gross Margin	Three Months Ended October 31,						Nine Months Ended October 31,
		2024			2023			2024			2023

Gross profit	$	106,142		$	87,582		$	299,132		$	236,308
Plus:
Stock-based compensation expense		1,003			900			3,045			2,690
Employer taxes related to stock-based compensation expense		42			29			156			81
Non-GAAP gross profit	$	107,187		$	88,511		$	302,333		$	239,079
GAAP gross margin		69.8	%		70.7	%		69.1	%		69.3	%
Non-GAAP gross margin		70.5	%		71.4	%		69.8	%		70.1	%

Reconciliation of GAAP to Non-GAAP Operating Expenses	Three Months Ended October 31,					Nine Months Ended October 31,
		2024			2023		2024			2023

GAAP sales and marketing expense	$	74,658		$	66,395	$	213,054		$	184,074
Less:
Stock-based compensation expense		9,608			7,899		28,945			23,554
Employer taxes related to stock-based compensation expense		247			245		1,070			609
Restructuring expense		—			—		—			541
Non-GAAP sales and marketing expense	$	64,803		$	58,251	$	183,039		$	159,370

GAAP research and development expense	$	32,855		$	29,872	$	100,369		$	88,749
Less:
Stock-based compensation expense		10,343			9,479		32,623			29,251
Employer taxes related to stock-based compensation expense		220			199		1,400			721
Non-GAAP research and development expense	$	22,292		$	20,194	$	66,346		$	58,777

GAAP general and administrative expense	$	31,199		$	26,448	$	86,309		$	75,884
Less:
Stock-based compensation expense		7,364			5,761		21,805			17,466
Employer taxes related to stock-based compensation expense		127			84		567			239
1% Pledge charitable contribution expense		1,417			1,427		2,764			2,391
Acquisition related expense		—			—		—			1,946
Amortization of intangibles expense		101			215		459			363
Restructuring expense		—			—		—			103
Contingent consideration adjustment		(86	)		—		(223	)		—
Non-GAAP general and administrative expense	$	22,276		$	18,961	$	60,937		$	53,376

Reconciliation of GAAP to Non-GAAP Operating Loss	Three Months Ended October 31,						Nine Months Ended October 31,
		2024			2023			2024			2023

Loss from operations	$	(32,570	)	$	(35,133	)	$	(100,600	)	$	(112,399	)
Plus:
Stock-based compensation expense		28,318			24,039			86,418			72,961
Employer taxes related to stock-based compensation expense		636			557			3,193			1,650
1% Pledge charitable contribution expense		1,417			1,427			2,764			2,391
Acquisition related expense		—			—			—			1,946
Amortization of intangibles expense		101			215			459			363
Restructuring expense		—			—			—			644
Contingent consideration adjustment		(86	)		—			(223	)		—
Non-GAAP loss from operations	$	(2,184	)	$	(8,895	)	$	(7,989	)	$	(32,444	)
GAAP operating margin		(21.4	)%		(28.3	)%		(23.2	)%		(33.0	)%
Non-GAAP operating margin		(1.4	)%		(7.2	)%		(1.8	)%		(9.5	)%

Reconciliation of GAAP to Non-GAAP Net Income (Loss)	Three Months Ended October 31,						Nine Months Ended October 31,
		2024			2023			2024			2023

Net loss attributable to Braze, Inc.	$	(27,911	)	$	(30,741	)	$	(86,551	)	$	(100,889	)
Plus:
Stock-based compensation expense		28,318			24,039			86,418			72,961
Employer taxes related to stock-based compensation expense		636			557			3,193			1,650
1% Pledge charitable contribution expense		1,417			1,427			2,764			2,391
Acquisition related expense		—			—			—			1,946
Amortization of intangibles expense		101			215			459			363
Restructuring expense		—			—			—			644
Contingent consideration adjustment		(86	)		—			(223	)		—
Non-GAAP net income (loss) attributable to Braze, Inc. ⁽¹⁾	$	2,475		$	(4,503	)	$	6,060		$	(20,934	)

Non-GAAP net income (loss) per share attributable to Braze, Inc. common stockholders, basic	$	0.02		$	(0.05	)	$	0.06		$	(0.21	)
Non-GAAP net income (loss) per share attributable to Braze, Inc. common stockholders, diluted	$	0.02		$	(0.05	)	$	0.06		$	(0.21	)
Weighted-average shares used to compute net income (loss) per share attributable to Braze, Inc. common stockholders, basic		102,146			97,880			101,714			97,615
Weighted-average shares used to compute net income (loss) per share attributable to Braze, Inc. common stockholders, diluted		106,820			97,880			106,614			97,615

⁽¹⁾Assumes no non-GAAP tax expenses associated with the non-GAAP adjustment due to the Company's historical non-GAAP net loss position and available deferred tax assets sufficient to offset such non-GAAP tax expense.

Reconciliation of GAAP Cash Flow from Operating Activities to Non-GAAP Free Cash Flow	Three Months Ended October 31,						Nine Months Ended October 31,
		2024			2023			2024			2023

Net cash provided by/(used in) operating activities	$	(11,410	)	$	(2,003	)	$	19,597		$	3,029
Less:
Purchases of property and equipment		(1,923	)		(3,012	)		(12,147	)		(3,439	)
Capitalized internal-use software costs		(915	)		(896	)		(3,023	)		(2,536	)
Non-GAAP free cash flow	$	(14,248	)	$	(5,911	)	$	4,427		$	(2,946	)

Source: Braze, Inc.

Braze is a registered trademark of Braze, Inc.

All product and company names herein may be trademarks of their registered owners.

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