Braze Inc (NASDAQ: BRZE) has maintained its Buy rating and $70.00 price target from analysis firm Needham, following the company's recent analyst day event.
The firm's analyst highlighted Braze's long-term potential in a market expected to grow at a compound annual growth rate (CAGR) of approximately 20% in the near term.
The new product announcements at the event were not deemed transformational but were seen as expected leading innovations within the industry.
The analyst pointed out that Braze's customer channel usage is now shifting towards favoring four or more channels, which underscores the company's potential for generational growth.
This trend is significant as legacy platforms, which are typically single-channel in architecture, may not be able to compete effectively as consumer purchasing preferences evolve.
During the analyst day, attention was drawn to the anticipated decline in dollar-based net retention (DBNR) from 114% in the second quarter to 110% in the fourth quarter.
In other recent news, Braze reported a significant rise in its fiscal second quarter 2025 revenue, showcasing a 26% increase year-over-year to reach $145.5 million. Additionally, the company added 61 new customers, growing the total to 2,163. The launch of the Braze data platform bolstered the financial growth.
TD Cowen, in their analysis, maintained a positive stance on Braze Inc., reiterating a Buy rating for the company. The firm anticipates a return to more standard performance metrics in the second half of the year, despite a transient decline in shares due to increased pressure on billings and net revenue retention metrics this quarter.
TD Cowen's confidence in Braze's ability to deliver consistent financial performance is underscored by the company's progress in gross margins and operating margins.
According to analysts, Braze's Q3 revenue is projected to fall between $147.5 million and $148.5 million, with the full fiscal year 2025 revenue expected to be between $582.5 million and $585.5 million. The company reported a non-GAAP operating income of $4.2 million, representing 3% of revenue, and ended the quarter with $504 million in cash and cash equivalents.
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