BRZE 10-K & 10-Q changes, risk factors and insider trading

The global economy, including credit and financial markets, has experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, increases in inflation rates, higher interest ratesrates, tariffs, and uncertainty about economic stability. These unfavorable conditions have been, and may continue to be, exacerbated in the United States and abroad by global and domestic socioeconomic conditions, including the failure of high-profile banking and other financial institutions, the Federal Reserve’s attempts to combat inflation through interest rate increases, unrest in international trade relations,relations (including those related to trade wars, tariffs, taxation, and importation), domestic and foreign political turmoil, natural catastrophes, pandemics related to highly infectious diseases, warfare and terrorist attacks on the United States, Europe, the Asia Pacific region or elsewhere, and international military conflicts and the related political and economic responses. Continued volatility and disruptions may have adverse consequences on us or the third parties on whom we rely. If the financial, equity or credit markets further deteriorate, including as a result of the measures taken to combat inflation, volatility in the banking and financial services sector, political unrest or war, it may make any necessary debt or equity financing more difficult to obtain in a timely manner or on favorable terms, more costly or more dilutive. Increased inflation rates can adversely affect us by increasing our costs, including labor and employee benefits costs. In addition, higher inflation and macroeconomic turmoil and uncertainty could also adversely affect our customers, which could reduce demand for our products and services. For instance, we were founded in 2011, but our business and revenue have grown rapidly over the last several years. As a result of our limited history operating at our current scale, our ability to accurately forecast our future results of operations is limited and subject to a number of uncertainties, including our ability to plan for and model future growth, particularly in a volatile economic environment. Recent increases in inflation, economic volatility and related increasesfluctuations in interest rates have affected customer spending behavior. Significant continued increases in inflation, continued economic volatilitybehavior, and relatedif increasesany inof interestfactors ratescontinue or are exacerbated, could have a material adverse effect on our business, financial condition and results of operations. To the extent there is a sustained general economic downturn and our customer engagement platform is perceived by customers and potential customers as too costly, or too difficult to deploy or migrate to, our revenue may be disproportionately affected by delays or reductions in general customer engagement technology spending. This perception has previously, and may continue to, result in an extension of our sales cycle with potential customers, thus increasing the time and cost associated with our sales process. Further, even if our customers choose to use our platform, they may nonetheless reduce their customer engagement technology spending and elect not to purchase additional products and services in the future due to budget limitations. Additionally, our dollar-based net retention rate is influenced by macroeconomic factors that impact our customers’ purchasing decisions, who may choose to renew their contracts at levels more closely aligned with their current needs, rather than opting for larger commitments based on anticipated future demand. Macroeconomic factors may also impact our collection efforts for customer payments. If we experience collection pressure it may lengthen the time to collect on accounts receivable and increase in our bad debt expense, either of which could negatively impact our free cash flow. Also, competitors may respond to market conditions by lowering prices and attempting to lure away our current and potential customers. In addition, macroeconomic uncertainty may result in an increased pace of consolidation in certain industries in which our customers operate. If this were to occur it may result in reduced overall spending on our services, particularly if our customers are acquired by organizations that do not use our services. We cannot predict the timing, strength or duration of any economic slowdown, instability or recovery, generally or within any particular industry. If the economic conditions of the general economy or the markets in which we operate worsen from present levels, our business, results of operations and financial condition could be materially and adversely affected.

We have funded our operations since inception primarily through equity financings, including through the public markets in our initial public offering, and sales of subscriptions to our platform. We cannot be certain when or if our operations will generate sufficient cash to fully fund our ongoing operations or the growth of our business. We intend to continue to make investments to support our business and may require additional funds to respond to business challenges, including the need to develop new features or enhance our platform, improve our operating infrastructure or acquire complementary businesses and technologies. Accordingly, we may need to engage in equity or debt financings to secure additional funds. Additional financing may not be available on terms favorable to us, including as a result of inflationary pressure and a higher interest rate environment, if at all. If adequate funds are not available on acceptable terms, we may be unable to invest in future growth opportunities, which could harm our business, financial condition and results of operations. If we incur debt, the debt holders would have rights senior to holders of our Class A and Class B common stock to make claims on our assets, and the terms of any debt could include restrictive covenants relating to our capital raising activities and other financial and operational matters, any of which may make it more difficult for us to obtain additional capital and to pursue business opportunities. Furthermore, if we issue equity securities, our stockholders will experience dilution, and the new equity securities could have rights senior to those of our Class A common stock and Class B common stock. Because our decision to issue securities in the future will depend on numerous considerations, including factors beyond our control, we cannot predict or estimate the amount, timing, or nature of any future issuances of debt or equity securities. As a result, our stockholders bear the risk of future issuances of debt or equity securities reducing the value of our Class A common stock and diluting their interests.

•general gobal economic and political conditions, as well as economic conditions specifically affecting industries in which our customers operate.

We track certain operational metrics, including, among others, the number of customers, monthly active users, platform enabled interactions, consumer generated data points, customer messages, annual recurring revenue, dollar-based net retention rate and Non-GAAPnon-GAAP free cash flow. Our operational metrics are tracked with internal systems and tools that are not independently verified by any third party and which may differ from estimates or similar metrics published by third parties due to differences in sources, methodologies, or the assumptions on which we rely. Our internal systems and tools have a number of limitations, and our methodologies for tracking these metrics may change over time, which could result in unexpected changes to our metrics, including the metrics we publicly disclose. If the internal systems and tools we use to track these metrics undercount or overcount performance or contain algorithmic or other technical errors, the data we report may not be accurate. While these numbers are based on what we believe to be reasonable estimates of our metrics for the applicable period of measurement, there are inherent challenges in measuring how our platform is used across large populations. In addition, limitations or errors with respect to how we measure data or with respect to the data that we measure may affect our understanding of certain details of our business, which could affect our long-term strategies. If our operating metrics are not accurate representations of our business, if investors do not perceive our operating metrics to be accurate, or if we discover material inaccuracies with respect to these figures, we expect that our business, reputation, financial condition, and results of operations would be adversely affected.

The market for customer engagement products is evolving and highly competitive. There are several established and emerging competitors that address specific aspects of customer engagement. We face intense competition from software companies that offer marketing solutions, such as legacyAdobe, marketingSalesforce, clouds like AdobeIterable, and Salesforce, and point solutions like Airship, Iterable, Klaviyo, CleverTap and MoEngage.Klaviyo. Many of our existing competitors have, and our potential competitors could have, substantial competitive advantages, such as greater name recognition, longer operating histories, larger sales and marketing budgets and resources, greater customer support resources, lower labor and development costs, larger and more mature intellectual property portfolios and substantially greater financial, technical and other resources than we do. In addition, our competitors may have an advantage in markets where our policies regarding the use of customer data are more restrictive than local laws, regulations, policies and standards. For example, competitors willing to sell customer data in markets where such activity is permissible may have a pricing advantage over us in such markets. Any such pricing advantages that our competitors have may negatively affect our ability to gain new customers and retain existing customers. Additionally, to the extent there is a sustained general economic downturn,volatility, our customers and potential customers may experience delays and reductions in general customer engagement technology spending. As a result, our competitors have in the past responded, and may continue in the future to respond, to market conditions by lowering prices and attempting to lure away our current and potential customers. With the introduction of new technologies and the entry of new competitors into the market, we expect competition to persist and intensify in the future. In addition, in recent years, there has been significant merger and acquisition activity among our competitors,competitors includingand the acquisitionbroader oftechnology Leanplum by CleverTap.industry. Continued merger and acquisition activity in the technology industry could further increase the likelihood that we compete with other large technology companies. This could harm our ability to increase sales, maintain or increase subscription renewals, and maintain our prices.

Our ability to attract new customers and increase revenue from existing customers depends in large part on our ability to enhance and improve our platform and its products and functionality, increase adoption and usage of our platform, and introduce new products and functionality. The market in which we compete is subject to rapid technological change, evolving industry standards and changing regulations, as well as changing customer and consumer needs, requirements and preferences, including changes in the use of channels through which consumers desire to communicate with brands. Additionally, we cannot predict what, if any, actions regulators will take regarding the use and sale of customer engagement software or in our key markets in the future. Any regulatory restrictions on the use of customer engagement tools from domestic or foreign regulators could reduce demand for our platform in the United States and foreign markets. Further, recent advances in, and the public availability of, generative artificialand intelligenceagentic AI have been, and may becontinue to be, a significant disruptor in consumer engagement and marketing strategies. The success of our business will depend, in part, on our ability to adapt and respond effectively to these changes on a timely basis. If we are unable to enhance our platform offerings to keep pace with rapid technological and regulatory change, or if new technologies emerge that are able to deliver competitive products at lower prices, more efficiently, more conveniently or more securely than our platform, our business, financial condition and results of operations may be adversely affected. Further as we develop, acquire, and introduce new services and technologies, including those that may incorporate artificial intelligenceAI and machine learning, we may be subject to new or heightened legal, ethical, and other challenges.

•the introduction of products and technologiestechnologies, including AI technologies, that serve as a replacement or substitute for, or represent an improvement over, our platform;

•technological innovationsinnovations, including related to AI, or new standards that our platform does not address;

We intend to continue to expand our international operations in the future.future and may expand our product and service offerings with future acquisitions. Our expansion will continue to place a significant strain on our managerial, administrative, financial and other resources. If we are unable to manage our growth successfully, our business, financial condition and results of operations may be adversely affected.

A component of our growth strategy involves the further expansion of our operations and customer base internationally, which will require significant dedication of management attention and financial resources. We are continuing to adapt to and develop strategies to address international markets, but there is no guarantee that such efforts will have the desired effect. We currently have customers in North and South America, Europe, the Middle East, and the Asia-Pacific region and Latin America.region. We are continuing to adapt and develop strategies to address international markets, but such efforts may not be successful. In addition, any future stay-at-home, business closure and other restrictive orders and travel restrictions into and outside the United States as a result of international conflicts, domestic unrest or the emergence of new highly infectious diseases, if any, may pose additional challenges for international expansion and may impact our ability to launch new locations and further expand geographically.

We have in the past and may in the future seek to acquire or invest in businesses, joint ventures, products and platform capabilities, or technologies that we believe could complement or expand our products and platform capabilities, enhance our technical capabilities or otherwise offer growth opportunities. For example, in MarchJune 2025, we announcedcompleted our planned acquisition of OfferFit, Inc., a modern agentic AI company, for $325 million, using a combination of cash and shares of our Class A common stock. The cash consideration in this transaction uses a significant portion of the proceeds from our initial public offering.Inc. This acquisition, and any other acquisition or investment we may make in the future, may result in unforeseen operating difficulties and expenditures. In particular, we may encounter difficulties assimilating or integrating the businesses, technologies, products and platform capabilities, personnel or operations of any acquired companies, including those of OfferFit, particularly if the key personnel of an acquired company choose not to work for us, their software is not easily adapted to work with our platform or we have difficulty retaining the customers of any acquired business due to changes in ownership, management or otherwise. These transactions may also disrupt our business, divert our resources and require significant management attention that would otherwise be available for development of our existing business. Any such transactions that we are able to complete may not result in any synergies or operational, financial or other benefits we had expected to achieve, which could result in impairment charges that could be substantial. Additionally, we willfunded funda approximatelysignificant 42%portion of the OfferFit acquisition with the issuance of shares of our Class A common stock, which will have a dilutive impact. Future transactions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our business, financial condition and results of operations. In addition, if the resulting business from such a transaction, including OfferFit, fails to meet our expectations, our business, financial condition and results of operations may be adversely affected, or we may be exposed to unknown risks or liabilities.

Additionally, AWS, Rackspace or other cloud providers may experience threats, attacks or security breaches from computer malware, ransomware, viruses, social engineering (including phishing attacks), denial-of-service or other attacks, employee error, theft or misuse and general hacking, including from state-sponsored or criminal hacking groups, which have become more prevalent in our industry. Any of these security incidents could result in unauthorized access or damage to, or the disablement, encryption, use or misuse, disclosure, modification, destruction or loss of our data or our customers’ data, including personal data, or disrupt our ability to provide our platform or services. Our platform’s continuing and uninterrupted performance is critical to our success. Customers may become dissatisfied by any system failure that interrupts our ability to provide our platform to them and could make claims for refunds or terminations under our contracts. We may not be able to easily switch our AWS or Rackspace operations to another cloud or other data center provider if there are disruptions or interference with our use of any third-party provider’s services, and even if we do switch our operations, the process can require significant time and expense and other cloud and data center providers are subject to the same risks. Sustained or repeated system failures would reduce the attractiveness of our platform to our customers, thereby reducing revenue. Moreover, negative publicity arising from these types of disruptions could damage our reputation and may adversely impact use of our platform. We may not carry sufficient business interruption insurance or have sufficient contractual remedies to compensate us for losses that may occur as a result of any events that cause interruptions in our service.

Outside of the United States, an increasing number of laws, regulations, rules and industry standards apply with respect to privacy, data security and data protection. For example, the European Union’s General Data Protection Regulation, or the EU GDPR, and the version thereof implemented into the laws of the United Kingdom, or the U.K. GDPR, impose strict requirements with respect to processing the personal data of individuals located within the European Economic Area, or the EEA, and the United Kingdom, or the U.K., respectively. While the EU GDPR and the U.K. GDPR remain substantially similar for the time being, the U.K. government has announcedamended thatthe itU.K. willGDPR seekthrough tothe chartData its own path on data protection(Use and Access) Act 2025 and may further reform its relevant laws, including in ways that may differ from the EU GDPR. While these developments increase uncertainty with regard to data protection regulation in the U.K., even in their current, substantially similar form, the EU GDPR and U.K. GDPR can expose businesses to divergent parallel regimes that may be subject to different interpretations and enforcement actions for certain violations and related uncertainty. Under the EU GDPR, government regulators may impose temporary or definitive bans on data processing, as well as fines of up to 20 million euros or 4% of annual global revenue, whichever is greater (and the U.K. GDPR currently imposes comparable penalties). Furthermore, because both regimes allow for private rights of action, individuals in the EEA and the U.K. may initiate litigation related to our processing of their personal data.

In addition, many jurisdictions have enacted data localization laws and cross-border personal data transfer laws. These laws may make it more difficult for us to transfer personal data across jurisdictions, which could impede our business. For example, legal developments in the EEA have created complexity and uncertainty regarding processing and transfers of personal data from the EEA to the United States and other countries outside the EEA. Similar complexities and uncertainties also apply to transfers from the U.K. to third countries. For example, the EU, U.K. and Switzerland have agreed to a ‘Data Privacy Framework’ for transfers of personal data from Europe to the U.SU.S. which we rely on. For the time being, this provides a valid mechanism for the international transfer of personal data. Privacy activists have challenged, and are expected to continue to challenge, the adequacy of this transfer mechanism, and therefore we cannot guarantee that such mechanism will remain available to us indefinitely. Additionally, with respect to transfers of personal data from the EEA to the U.K., on June 28, 2021, the European Commission issued an adequacy decision in respect of the U.K.’s data protection framework, enabling data transfers from EU member states to the U.K. to continue until June 27, 2025 without requiring organizations to put in place contractual or other measures in order to lawfully transfer personal data between the territories. While this adequacy decision was extended subsequently until December 2031, the European Commission may unilaterally revoke the adequacy decision at any point, and if this occurs, it could lead to additional costs and increase our overall risk exposure. While we have taken additional steps to mitigate the impact on us, such as implementing the European Commission’s updated standard contractual clauses, or the SCCs, and the U.K.’s international Data Transfer Agreement (or the U.K.’s international data transfer addendum that can be used with the SCCs), the validity of relying on the SCCs as a transfer mechanism has been, and is expected to continue to be, the subject of further litigation in the EU. Likewise, the validity of relying on the Data Privacy Framework to transfer data to the U.S. is vulnerable to litigation or regulatory action.

We have in the past, and may continue in the future to, become subject to legal proceedings and claims that arise in the ordinary course of business, such as claims brought by our customers in connection with commercial disputes or employment claims made by our current or former employees. Litigation mightmay result in substantial costs and may divert management’s attention and resources, which mightcould seriously harm our business, financial condition and results of operations. Insurance mightmay not cover such claims, provide sufficient payments to cover all the costs to resolve one or more of such claims or continue to be available on terms acceptable to us. A claim brought against us that is uninsured or under-insured could result in unanticipated costs, and our business, financial condition and results of operations may be adversely affected.

We are subject to anti-corruption, anti-bribery, anti-money launderinganti-bribery and similar laws, and non-compliance with such laws can subject us to criminal or civil liability and harm our business, financial condition and results of operations.

We are subjectrequired to comply with governmental export and import controls and economic sanctions that could impair our ability to compete in international markets and subject us to liability if we violate the controls.

Our platform is subject to U.S. export controls, including the Export Administration Regulations and economic sanctions administered by the U.S. Treasury Department’s Office of Foreign Assets Control.Regulations. We incorporate encryption technology into our platform. These encryption products and the underlying technology are currently considered “publicly available” by the Export Administration Regulations and may be freely exported outside of the United States. However, if they cease to be considered “publicly available,” then these encryption products and underlying technology may be exported outside of the United States only with the required export authorizations, including by license, a license exception or other appropriate government authorizations. Obtaining the necessary export license or other authorization for a particular sale may be time consuming and may result in the delay or loss of sales opportunities even if the export license ultimately may be granted.

Furthermore, our activities are subject to U.S. economic sanctions laws and regulations that prohibit transactions and dealings, including the shipmentexport or reexport of certain products and servicesservices, to countries, governments and persons targeted by U.S. embargoes or sanctions. Obtaining the necessary export license or other authorization for a particular sale may be time consuming and may result in the delay or loss of sales opportunities even if the export license ultimately may be granted. While we take precautions to prevent our platform from being exported in violation of these laws, including obtaining authorizations for our platform and performing geolocation IP blocking and screenings against United States and other lists of restricted and prohibited persons, we cannot guarantee that the precautions we take will prevent violations of export control and sanctions laws. Additionally, U.S. embargoesembargoes, trade restrictions and sanctions can change rapidly and unpredictably in response to international events, such as the application of newbroad sanctions and broadexport sanctionscontrol restrictions against Russia and Belarus in connection with the invasion of Ukraine. Future embargoes or sanctions on other jurisdictions could have a significant impact on our business or the business of our customers, either of which could have a material adverse effect on our financial results and operations. Violations of U.S. sanctions or export control laws can result in incarceration for responsible employees and managers or the imposition of significant fines or penalties.

VariousIn addition to the United States, various other countries regulate the import and export of certain encryption and other technology, including import and export licensing requirements. Some countries have enacted laws that could limit our ability to distribute our platform or could limit our customers’ ability to implement our platform in those countries. Changes in our platform or future changes in export and import regulations may create delays in the introduction of our platform in international markets, prevent our customers with international operations from launching our platform globally or, in some cases, prevent the export or import of our platform to certain countries, governments or persons altogether. Various governmental agencies have proposed additional regulation of encryption technology, including the escrow and government recovery of private encryption keys. Any change in export or import regulations, economic sanctions or related legislation, or change in the countries, governments, persons or technologies targeted by such regulations, could limit our ability to export or sell our platform to existing or potential customers with international operations. Any decreased use of our platform or limitation on our ability to export or sell our platform would adversely affect our business, results of operations and prospects.

We have registered the “Braze” name, logo, and/or other marks as trademarks in Australia, Brazil, Canada, the EU, India, Indonesia, Japan, New Zealand, Singapore, Tonga, the United Arab Emirates, the United Kingdom, and the United States. However, any pending or future trademark applications may not be approved, and any registered trademarks may not be enforceable or provide adequate protection of our proprietary rights. The USPTO and various foreign trademark offices also require compliance with a number of procedural, documentary, fee payment and other similar provisions during the trademark registration process and after a registration has issued. There are situations in which noncompliance can result in abandonment or cancellation of a trademark filing, resulting in partial or complete loss of trademark rights in the relevant jurisdiction. If this occurs, our competitors might be able to enter the market under identical or similar brands or we may be forced to abandon marks that we currently rely on.

Our use of artificial intelligence, or AI, and machine learning in our platform and our business, as well as our potential failure to effectively implement, use, and market these technologies, may result in reputational harm or liability, or could otherwise adversely affect our business.

We have incorporated and may continue to incorporate AI and machine learning solutions and features, including generative and agentic AI solutions and features, into our platform, and otherwise within our business, and these solutions and features may become more important to our operations or to our future growth over time. There can be no assurance that the use of AI and machine learning solutions and features will enhance our products or services, produce the intended results, or be beneficial to our business, including our efficiency or profitability, and we may fail to properly implement or market our AI and machine learning solutions and features. Our competitors or other third parties may incorporate AI and machine learning tools into their products, offerings, and solutions more quickly or more successfully than we do, which could impair our ability to compete effectively, and adversely affect our results of operations. Any of which may have an adverse impact on our results of operations even as our use and development of AI technologies expands.

Additionally, our AI and machine learning solutions and features may expose us to additional claims, demands, and proceedings by private parties and regulatory authorities and subject us to legal liability as well as brand and reputational harm. There are significant risks involved in utilizing AI and machine learning technologies, and in particular, generative and agentic AI technologies. For example, AI and machine learning algorithms may be flawed, insufficient, or of poor quality, reflect unwanted forms of bias, or contain other errors or inadequacies, any of which may not easily be detectable. AI and machine learning technologies have also been known to produce false or “hallucinatory” inferences or outputs. Further, inappropriate or controversial data practices by developers and end-users, or other factors adversely affecting public opinion regarding the use of AI and machine learning, could impair the acceptance of AI and machine learning solutions, including those incorporated into our products and services. If the AI and machine learning tools incorporated into our platform, or the content generated by such tools, is harmful, biased, inaccurate, discriminatory or controversial, we could suffer operational efficiencies in addition to legal, competitive and reputational harm, and our customers may be less likely to utilize our AI and machine learning tools or may cease using our platform altogether. If we do not have sufficient rights to use the output of such AI and machine learning tools, or the data or other material or content on which the AI and machine learning tools we use rely, we also may incur liability through the violation of applicable laws and regulations, third-party intellectual property, privacy or other rights, or contracts to which we are a party.

In addition, we are subject to the risks of new or enhanced governmental or regulatory scrutiny, litigation, or other legal liability, ethical concerns, negative consumer perceptions as to automation and AI and machine learning technologies, any of which could adversely affect our business, reputation, or financial results. The technologies underlying AI and machine learning and their uses are subject to a variety of laws and regulations related to online services, intermediary liability, intellectual property rights, privacy, data security and data protection, consumer protection, competition and equal opportunity laws, and are expected to be subject to increased regulation and new laws or new applications of existing laws and regulations. AI and machine learning technologies are the subject of ongoing review by various federal, state and foreign governments and regulators, which are applying, or are considering applying, their platform moderation, privacy, data security and data protection laws and regulations to such technologies. Additionally, various federal, state and foreign governments and regulators have implemented, or are considering implementing, general legal and regulatory frameworks for the appropriate use of AI and machine learning, such as the EU’s Artificial Intelligence Act, or the EU AI ActAct, which entered into force on August 1, 2024. The EU AI Act establishes, among other things, a risk-based governance framework for regulating AI systems operating in the EU. This framework would categorize AI systems, based on the risks associated with such AI systems’ intended purposes, as creating unacceptable or high risks, with all other AI systems being considered low risk. Although there are not yet any comprehensive U.S. federal laws specifically governing AI development and use, federal agencies in the United States are applying existing laws to address AI-related risks. In addition, an Executive Order issued in December 2025 seeks to establish uniform federal standards and challenge state laws that regulate AI. Various U.S. states, including New York, California and Colorado, have also passed laws regulating the development and use of AI. As the legal, regulatory, and policy environments around AI and machine learning evolve, we may become subject to new legal and regulatory obligations in connection with our use of AI and machine learning technology, which could require us to make significant changes to our policies and practices, necessitating expenditure of significant time, expense, and other resources. We may not be able to anticipate how to respond to rapidly evolving legal and regulatory frameworks, and we may have to expend resources to adjust our offerings in certain jurisdictions if the legal and regulatory frameworks on AI and machine learning products are not consistent across jurisdictions. Accordingly, it is not possible to predict all of the risks related to the use of AI and machine learning solutions that we may face, and changes in laws, rules, directives, and regulations governing the use of AI and machine learning solutions may adversely affect our ability to use or sell these solutions or subject us to legal liability.

Natural catastrophic events and human-made problems such as climate change, power disruptions, computer viruses, global pandemics, data security breachesbreaches, terrorism and terrorismwar may disrupt our business.

We rely heavily on our network infrastructure and information technology systems for our business operations. An online attack, damage as a result of civil unrest, earthquake, fire, terrorist attack, war, power loss, global pandemics, telecommunications failures, climate change-related events or other similar catastrophic event could cause system interruptions, delays in accessing our service, reputational harm and loss of critical data. Such events could prevent us from providing our platform and products to our customers. A catastrophic event that results in the destruction or disruption of our data centers, or our network infrastructure, or information technology systems, including any errors, defects, or failures in third-party hardware, could affect our ability to conduct normal business operations and adversely affect our results of operations. In addition, many companies that provide cloud-based services have reported a significant increase in cyberattack activity in recent years. Further, events outside of our control, including natural disasters, climate change-related events, pandemics or health crises may arise from time to time and be accompanied by governmental actions. Any such events and responses, including regulatory developments, may cause significant volatility and declines in the global markets, disproportionate impacts to certain industries or sectors, disruptions to commerce (including to economic activity, travel and supply chains), loss of life and property damage, and may materially and adversely affect the global economy or capital markets, as well as our business and results of operations.

We have identified a material weakness in our internal control over financial reporting associated with certain Information Technology General ControlsControls, ("ITGCs").or ITGCs. If we are unable to remediate this, or otherwise fail to maintain proper and effective internal controls, our ability to produce timely and accurate financial statements could be impaired, which could adversely affect our operating results, our ability to operate our business, our stock price and access to the capital markets.

We are subject to risks related to our environmental, social, and governancegovernance, or ESG, practices and disclosures.

ESG matters have been a focus of regulators, certain investorsinvestors, and other stakeholders, both in the United States and internationally. Often those stakeholders have differing, and sometimes conflicting, priorities or requirements regarding ESG matters. The heightened and sometimes conflicting stakeholder focus on ESG issues related to our business requires the continuous monitoring of various and evolving laws, regulations, standards and expectations and the associated reporting requirements. Our interpretation or application of such reporting requirements may change over time or differ from other similarly situated companies. Certain organizations also provide ESG ratings, scores and benchmarking studies that assess companies’ ESG practices. Although there are no universal standards for such ratings, scores or benchmarking studies, they are used by some investors to inform their investment and voting decisions. It is possible that our future shareholders or organizations that report on, rate or score ESG practices will not be satisfied with our ESG strategy or performance. Unfavorable or inaccurate press about ratings or assessments of our ESG strategies or practices, regardless of whether or not we comply with applicable legal requirements, may lead to adverse investor sentiment toward us, which in turn could have an adverse impact on our share price, demand for our securities and our access to, and cost of, capital.

In addition, any of our current or future social impact practices and initiatives could be difficult to achieve and costly to implement. In the event that we publicly disclose, voluntarily or otherwise, certain practices and initiatives regarding ESG matters, we could fail, or be perceived to fail, in our achievement of such practices or initiatives, or we could be criticized for the scope of such practices or initiatives, which could negatively impact our ability to attract or retain employees or customers or reduce the attractiveness of our stock in the investment community. There has also been a recent increase in litigation surrounding ESG practices and related disclosures. Further, “anti-ESG” sentiment has gained momentum across the United States, with a growing number of states and federal agencies having enacted, proposed or indicated an intent to pursue “anti-ESG” policies, legislation or issued related legal opinions and engaged in related investigations and litigation. There can be no assurance that we will not be subject to allegations or claims associated with our sustainability-related claims or other ESG practices and initiatives.

We have never declared or paid any cash dividends on our Class A or Class B common stock and we do not intend to pay any cash dividends in the foreseeable future. We anticipate that we will retain all of our future earnings for use in the development of our business and for general corporate purposes. Any determination to pay dividends in the future will be at the discretion of our board of directors and governed by the limitations of any credit agreements we may become party to. Accordingly, investors must rely on sales of their Class A common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investments.

Future sales of a substantial number of shares of our Class A common stock in the public market, or the perception that these sales might occur, could depress the market price of our Class A common stock and could impair our ability to raise capital through the sale of additional equity securities. ManySome of our existing equity holders may have substantial unrecognized gains on the value of the equity they hold, and therefore they may take steps to sell their shares or otherwise secure the unrecognized gains on those shares. Additionally, we plan to issueissued shares of Class A commons stock in our planned acquisition of OfferFit, and have agreed to registerregistered the re-sale of these shares. We are unable to predict the effect that such sales may have on the prevailing market price of our Class A common stock.

We have registered all of our common stock issuable upon the exercise of outstanding stock options,or settlement of outstanding restrictedequity stock units, or RSUs, or otherwise issuableawards, pursuant to the terms of the purchase rights under our employee stock purchase plan or under any other equity incentives we may grant in the future, for public resale under the Securities Act. Such underlying shares of Class A common stock will become eligible for sale in the public market to the extent such optionsshares are issued pursuant to the terms of the applicable equity incentive plan or purchaseaward rights are exercised or RSUs are settled,agreement, subject to compliance with applicable securities laws.

•changes in laws or regulations applicable to the provision of our products and services or changes that may cause us to incur, among other elements,things, additional or unforeseen expenses associated with regulatory compliance;

We expect to issue additional capital stock in the future that will result in dilution to all other stockholders. We expect to grant equity awards to employees, directors and consultants under our equity incentive plans and purchase rights to our employees under our employee stock purchase plan. We may also raise capital through equity financings in the future. As part of our business strategy, we may acquire or make investments in companies, products, services or technologies and issue equity securities to pay for any such acquisition or investment. For instance, we plan to issueissued shares of Class A common stock as a portion of the consideration in our proposed acquisition of OfferFit. Any such issuances of additional capital stock may cause stockholders to experience significant dilution of their ownership interests and the per share value of our Class A common stock to decline.

Braze is a leading customer engagement platform that empowers brands to Be Absolutely Engaging. Our platform empowersbrings brandstogether torich, listenfirst-party tocontext, theirtransforms customersthat better,context understandwith themcomposable moreintelligence deeply,(models, agents, and act on that understanding in a way that is humanoperators), and personal.delivers continuous, and personally relevant interactions across channels. Using our platform, brands ingest and process customer data in real time, orchestrate and optimize contextually relevant,relevant marketing campaigns across multiple channels. Our platform is designed so that interactions between brands and consumers have the same relevance and cross-channel continuity as human interactions.

Our customers include many established global enterprises and leading technology innovators, and span a wide variety of sizes and industries, including retail and consumer goods, media and entertainment, telecommunications,gaming, sports, restaurants and on-demand services, healthcare and life sciences, technology, manufacturing, education, government and public services, and financial services.

We have grown significantly in recent periods. We generated revenue of $593.4$738.2 million, $471.8$593.4 million, and $355.4$471.8 million in the fiscal years ended January 31, 2026, 2025, 2024, and 2023,2024, respectively, representing year-over-year growth of 25.8%24.4% from the fiscal years ended January 31, 20242025 to January 31, 20252026 and 32.7%25.8% from the fiscal year ended January 31, 20232024 to January 31, 2024.2025. We had net losses of $104.0$130.8 million, $130.4$104.0 million and $140.7$130.4 million, in the fiscal years ended January 31, 2026, 2025, 2024, and 2023,2024, respectively. We had net cash provided by operating activities of $71.4 million, $36.7 million in the fiscal year ended January 31, 2025. We had net cash provided by operating activities of $6.9 millionmillion, and net cash used in operating activities of $22.3$6.9 million in the fiscal years ended January 31, 20242026, 2025, and 2023,2024, respectively. Our Non-GAAPnon-GAAP free cash flow was $19.6$58.1 million, $(6.5)$19.6 million and $(39.06.5) million in the fiscal years ended January 31, 2026, 2025, 2024, and 2023,2024, respectively. See the section titled “— Non-GAAP Free Cash Flow” for additional information about how we calculate free cash flow, a non-GAAP financial metric, and a reconciliation to net cash provided by operating activities, the most directly comparable measure calculated in accordance with accounting principles generally accepted in the United States, or U.S. GAAP.

We believe there is a significant opportunity to continue to expand our presence in international markets we have already penetrated and by entering markets we have not yet penetrated. For the fiscal years ended January 31, 2026, 2025, 2024, and 2023,2024, approximately 45%, 43%,45%, and 42%,43%, of our revenue was generated outside of the United States, respectively. We expect to increase market penetration in regions including Europe and Asia-Pacific and to further capitalize on the greenfield opportunityopportunities in regions such as Latin America.globally. Although these investments in geographic regions may negatively affect our operating results in the near term, we believe that they will contribute to our long-term growth.

Cost of revenue consists of direct costs related to providing platform access to our customers and to performing onboarding and professional services including consulting services. These costs primarily include payments to third-party cloud infrastructure providers for hosting software solutions, costs associated with application service providers utilized to deliver the platform, personnel-related costs, including salaries, cash-based performance compensation, benefits and stock-based compensation, and overhead cost allocations, including rent, utilities, depreciation, information technology costs, depreciation and amortization related to the amortization of acquired intangibles and internal use software and certain administrative personnel costs.

ProvisionThe provision for income taxes consistsconsist of statethe incomerelease taxesof the valuation allowance due to the acquisition of Offerfit and income taxes in certainstate and foreign jurisdictions in which we conduct business. We maintain a full valuation allowance in jurisdictions where we had net deferred tax assets as we have concluded that it is not more likely than not that the deferred tax assets will be realized.

The increase in costCost of revenue ofincreased $35.7by $59.3 million, or 24.2%,32.4%, for the fiscal year ended January 31, 20252026 compared to the fiscal year ended January 31, 20242025. This increase was primarily driven by a $25.2 million increase in third-party messaging fees associated with growth in premium messaging channels and an increase of $7.5$17.9 million in hosting, infrastructure, and other third-party fees associated with delivering our platform and a $24.0 million increase in third-party messaging fees associated with growth in premium messaging channels.services. In addition, we had ana net increase of $16.2 million in personnel costs, other overhead, and overheadamortization costs of $3.2 million.expenses. The increased infrastructure, messaging, and personnel costs were incurred to support overall revenue growth.

Our gross profit increased $85.9$85.4 million, or 26.5%,20.8%, in the fiscal year ended January 31, 20252026, compared to the fiscal year ended January 31, 2024,2025, and our gross margin increaseddecreased by 0.4%2.0% to 67.1% in the fiscal year ended January 31, 2026, from 69.1% in the fiscal year ended January 31, 20252025. fromThe 68.7%decrease inwas the fiscal year ended January 31, 2024. These increases wereprimarily due primarily to improvedacquisition related operating costs, including personnel efficiencies, economies of scale, and the optimization of costs of acquired workforce and amortization expense of acquired technology, in addition to increased costs related to our tech stack as our infrastructure costs to support our revenue growth did not increase at the same pace as our revenue.stack.

The increasedecrease in other income, net of $5.3$5.0 million, or 32.9%,23.0%, for the fiscal year ended January 31, 2025,2026, compared to the fiscal year ended January 31, 2024,2025, was attributable to a $5.2$4.7 million increasedecrease in investment income from marketable securities. The investment income decrease was driven primarily by the decrease in the marketable securities balance period-over-period to fund acquisition activities.

As of January 31, 2025,2026, our principal source of liquidity was cash, cash equivalents, and marketable securities of $514.0$415.9 million. Our cash and cash equivalents consist of deposit accounts, interest-bearing money market accounts, and U.S. government, and corporategovernment securities that are stated at fair value. Our marketable securities positions consists mostly of highly liquid short-term investments. The investment income that we generate on these investments is not material to our overall cash balance, but may be adversely affected due to volatility in interest rates.

A substantial source of our cash provided by operating activities is our deferred revenue, which is included on our consolidated balance sheets as a liability. Deferred revenue consists of the unearned portion of billed fees for our subscriptions, which is recorded as revenue over the term of the subscription agreement. As of January 31, 2025,2026, we had total deferred revenue of $240.3$304.6 million, of which $240.0 million was recorded as a current liability. Deferred revenue will be recognized as revenue when all of the revenue recognition criteria are met.

Net cash used in investing activities was $36.5$50.9 million for the fiscal year ended January 31, 2025,2026, primarily consisting of cash paid for the acquisition of OfferFit, net of cash acquired of $181.9 million, purchases of marketable securities of $218.0$151.6 million,,million, purchases of property and equipment of $13.2$9.6 million, and capitalization of internal-use software costs of $3.8 million, partially offset by maturities of marketable securities of $195.4$175.2 million and a return of principal on marketable securities of $120.7 million.

Net cash used in investing activities was $20.0$36.5 million for the fiscal year ended January 31, 2024,2025, primarily consisting of purchases of marketable securities of $248.1 million, cash paid for the acquisition of North Star of $16.3$218.0 million, purchases of property and equipment of $9.8$13.2 million, and capitalization of internal-use software costs of $3.6$3.8 million, partially offset by maturities of marketable securities of 257.7195.4 million.

Our most significant funding requirements are principally comprised of employee compensation and related taxes and benefits, non-cancelable purchase commitments, and operating lease obligations. Non-cancelable purchase commitments for business operations and operating lease obligations total $224.4 million and $114.8 million, respectively, as of January 31, 2025. Purchase commitments for business operations are predominatelyprimarily related to cloud hosting, infrastructure, and other software-based services and due primarily over the next three years. Our future funding requirements to settle our obligations in foreign jurisdictions are subject to fluctuations due to changes in foreign exchange rates.

We believe that the following critical accounting policies involve a greater degree of judgementjudgment or complexity. Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of operations.

The global economy, including credit and financial markets, has experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, increases in inflation rates, higher interest rates, tariffs,tariffs and uncertainty about economic stability. These unfavorable conditions have been, and may continue to be, exacerbated in the United States and abroad by global and domestic socioeconomic conditions, including the failure of high-profile banking and other financial institutions, the Federal Reserve’s attempts to combat inflation through interest rate increases, unrest in international trade relations (including those related to trade wars, tariffs, taxation, and importation), domestic and foreign political turmoil, natural catastrophes, pandemics related to highly infectious diseases, warfare and terrorist attacks on the United States, Europe, the Asia Pacific region or elsewhere, and international military conflicts and the related political and economic responses, including ongoing economic uncertainty from trade and resource restrictions resulting therefrom. Continued volatility and disruptions may have adverse consequences on us or the third parties on whom we rely. If the financial, equity or credit markets further deteriorate, including as a result of the measures taken to combat inflation, volatility in the banking and financial services sector, political unrest or war (including restrictions on international trade related thereto), it may make any necessary debt or equity financing more difficult to obtain in a timely manner or on favorable terms, more costly or more dilutive. Increased inflation rates can adversely affect us by increasing our costs, including labor and employee benefits costs. In addition, higher inflation and macroeconomic turmoil and uncertainty could also adversely affect our customers, which could reduce demand for our products and services. For instance, we were founded in 2011, but our business and revenue have grown rapidly over the last several years. As a result of our limited history operating at our current scale, our ability to accurately forecast our future results of operations is limited and subject to a number of uncertainties, including our ability to plan for and model future growth, particularly in a volatile economic environment. Recent increases in inflation, economic volatility and related fluctuations in interest rates have affected customer spending behavior, and if any of these factors continue or are exacerbated,exacerbated could have a material adverse effect on our business, financial condition and results of operations. To the extent there is a sustained general economic downturn and our customer engagement platform is perceived by customers and potential customers as too costly, or too difficult to deploy or migrate to, our revenue may be disproportionately affected by delays or reductions in general customer engagement technology spending. This perception has previously, and may continue to, result in an extension of our sales cycle with potential customers, thus increasing the time and cost associated with our sales process. Further, even if our customers choose to use our platform, they may nonetheless reduce their customer engagement technology spending and elect not to purchase additional products and services in the future due to budget limitations. Additionally, our dollar-based net retention rate is influenced by macroeconomic factors that impact our customers’ purchasing decisions, who may choose to renew their contracts at levels more closely aligned with their current needs, rather than opting for larger commitments based on anticipated future demand. Macroeconomic factors may also impact our collection efforts for customer payments. If we experience collection pressure it may lengthen the time to collect on accounts receivable and increase in our bad debt expense, either of which could negatively impact our free cash flow. Also, competitors may respond to market conditions by lowering prices and attempting to lure away our current and potential customers. In addition, macroeconomic uncertainty may result in an increased pace of consolidation in certain industries in which our customers operate. If this were to occur it may result in reduced overall spending on our services, particularly if our customers are acquired by organizations that do not use our services. We cannot predict the timing, strength or duration of any economic slowdown, instability or recovery, generally or within any particular industry. If the economic conditions of the general economy or the markets in which we operate worsen from present levels, our business, results of operations and financial condition could be materially and adversely affected.

Our revenue was $211.0$438.2 million and $162.1$342.2 million for the threesix months ended AprilJuly 30,31, 2026 and 2025, respectively. You should not rely on our historical revenue growth as an indication of our future performance. Even if our revenue continues to increase, we expect that our annual revenue growth rate will decline in the future as a result of a variety of factors, including the maturation of our business. Overall growth of our revenue depends on several factors, including our ability to:

We have experienced net losses in each of our last several fiscal years. We generated a net loss of $25.5$43.8 million and $35.6$63.4 million for the threesix months ended AprilJuly 30,31, 2026 and 2025, respectively. As of AprilJuly 30,31, 2026, we had an accumulated deficit of $744.7$763.6 million. While we have experienced significant revenue growth in recent periods, we cannot guarantee whether or when we will achieve or maintain profitability in the future. We also expect our costs and expenses to increase in future periods, which could negatively affect our future results of operations if our revenue does not continue to increase. In particular, we intend to continue to expend substantial financial and other resources on:

Our ability to attract new customers and increase revenue from existing customers depends in large part on our ability to enhance and improve our platform and its products and functionality, increase adoption and usage of our platform, and introduce new products and functionality. The market in which we compete is subject to rapid technological change, evolving industry standards and changing regulations, as well as changing customer and consumer needs, requirements and preferences, including changes in the use of channels through which consumers desire to communicate with brands. Additionally, we cannot predict what, if any, actions regulators will take regarding the use and sale of customer engagement software or in our key markets in the future. Any regulatory restrictions on the use of customer engagement tools from domestic or foreign regulators could reduce demand for our platform in the United States and foreign markets. Further, recent advances in, and the public availability of, generative and agentic AI have been,been and may continue to be, a significant disruptor in consumer engagement and marketing strategies. The success of our business will depend, in part, on our ability to adapt and respond effectively to these changes on a timely basis. If we are unable to enhance our platform offerings to keep pace with rapid technological and regulatory change, or if new technologies emerge that are able to deliver competitive products at lower prices, more efficiently, more conveniently or more securely than our platform, our business, financial condition and results of operations may be adversely affected. Further as we develop, acquire, and introduce new services and technologies, including those that may incorporate AI and machine learning, we may be subject to new or heightened legal, ethical, and other challenges.

•political instability, economic sanctions, terrorist activities, or international conflicts,conflicts may impact the operations of our business or the businesses of our customers;

We are subject to anti-corruption, anti-briberyanti-bribery, and similar laws, and non-compliance with such laws can subject us to criminal or civil liability and harm our business, financial condition and results of operations.

As of AprilJuly 30,31, 2026, we owned 2930 granted patents related to our platform and its technology and fourone patent applicationsapplication pending for examination in the United States and no non-U.S. patents or patent applications pending. Our patent applications may not result in the issuance of a patent, or the examination process may require us to narrow our claims. Any patents that issue from any patent applications may not give us the protection that we seek or may be challenged, invalidated or circumvented. Any patents that may issue in the future from our pending or future patent applications may not provide sufficiently broad protection and may not be valid and enforceable in actions against alleged infringers or provide us with a competitive advantage. Any patents we have obtained or may obtain in the future may be found to be invalid or unenforceable in light of recent and future changes in the law, or because of technology developed prior to the inventions we have sought to patent or because of defects in our patent prosecution process. The United States Patent and Trademark Office, or the USPTO, and various foreign governmental patent agencies also require compliance with a number of procedural, documentary, fee payment and other similar provisions during the patent application process and after a patent has issued. There are situations in which noncompliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction.

We have incorporated and may continue to incorporate AI and machine learning solutions and features, including generative and agentic AI solutions and features, into our platform, and otherwise within our business, and these solutions and features may become more important to our operations or to our future growth over time. There can be no assurance that the use of AI and machine learning solutions and features will enhance our products or services, produce the intended results, or be beneficial to our business, including our efficiency or profitability, and we may fail to properly implement or market our AI and machine learning solutions and features. Our competitors or other third parties may incorporate AI and machine learning tools into their products, offerings, and solutions more quickly or more successfully than we do, which could impair our ability to compete effectively, and adversely affect our results of operations.operations.Further, our ability to continue to develop, deploy, or use AI and machine learning solutions and features is dependent on our access to technology offered by vendors and specific third-party software providers, such as third-party AI models. We cannot control the quality, performance, availability, or cost of such vendor offerings or third-party software. Consequently, our business operations and platform, products and services may be disrupted or placed at a competitive disadvantage if any of the third-party AI technology we rely upon becomes unavailable due to extended outages, capacity constraints, or commercially unreasonable terms of service. Any of whichthe foregoing may have an adverse impact on our results of operations even as our use and development of AI technologies expands.

Additionally, our AI and machine learning solutions and features may expose us to additional claims, demands, and proceedings by private parties and regulatory authorities and subject us to legal liability as well as brand and reputational harm. There are significant risks involved in utilizing AI and machine learning technologies, and in particular, generative and agentic AI technologies. For example, AI and machine learning algorithms may be flawed, insufficient, or of poor quality, reflect unwanted forms of bias, or contain other errors or inadequacies, any of which may not easily be detectable. AI and machine learning technologies have also been known to produce false or “hallucinatory” inferences or outputs. Further, inappropriate or controversial data practices by developers and end-users, or other factors adversely affecting public opinion regarding the use of AI and machine learning, could impair the acceptance of AI and machine learning solutions, including those incorporated into our products and services. If the AI and machine learning tools incorporated into our platform, or the content generated by such tools, is harmful, biased, inaccurate, discriminatory or controversial, we could suffer operational efficienciesinefficiencies in addition to legal, competitive and reputational harm, and our customers may be less likely to utilize our AI and machine learning tools or may cease using our platform altogether. If we do not have sufficient rights to use the output of such AI and machine learning tools, or the data or other material or content on which the AI and machine learning tools we use rely, we also may incur liability through the violation of applicable laws and regulations, third-party intellectual property, privacy or other rights, or contracts to which we are a party.

While we are in the process of implementing changes to remediate the material weakness identified, we cannot be certain as to when remediation will be complete or if the remediation efforts will be successful. Further, remediation efforts may place a significant burden on management and add increased pressure to our financial and information technology resources and processes. As a result, we may not be successful in making the improvements necessary to remediate the material weakness identified by management in a timely manner or in identifying and remediating additional control deficiencies, including material weaknesses, in the future. Any failure to remediate the material weakness identified, or the development of new material weaknesses in our internal control over financial reporting, could severely inhibit our ability to accurately report our financial condition or results of operations. We could lose investor confidence in the accuracy and completeness of our financial reports, the market price of our Class A common stock could decline, and we could be subject to sanctions or investigations by the SEC or other regulatory authorities. Failure to remedy the material weakness in our internal control over financial reporting, or theto implement or maintain other effective control systems required of public companies, could harm our results of operations or cause us to fail to meet our future reporting obligations.

Future sales of a substantial number of shares of our Class A common stock in the public market, or the perception that these sales might occur, could depress the market price of our Class A common stock and could impair our ability to raise capital through the sale of additional equity securities. Some of our existing equity holders may have substantial unrecognized gains on the value of the equity they hold, and therefore they may take steps to sell their shares or otherwise secure the unrecognized gains on those shares. Additionally, we issued shares of Class A commonscommon stock in our acquisition of OfferFit, and have registered the re-sale of these shares. We are unable to predict the effect that such sales may have on the prevailing market price of our Class A common stock.

We have grown significantly in recent periods. We generated revenue of $211.0$227.2 million and $180.1 million in the three months ended AprilJuly 30,31, 2026, and 2025, respectively, representing year-over-year growth of 30.2%26.2%, fromand $438.2 million and $342.2 million in the threesix months ended AprilJuly 30,31, 2025.2026 and 2025, respectively. We had net losses of $25.5$18.3 million and $35.6$27.8 million in the three months ended AprilJuly 30,31, 2026 and 2025, respectively, and $43.8 million and $63.4 million in the six months ended July 31, 2026 and 2025, respectively. We had net cash provided by operating activities of $28.1$52.3 million in the threesix months ended AprilJuly 30,31, 2026 and net cash provided by operating activities of $24.1$31.1 million in the threesix months ended AprilJuly 30,31, 2025.2025, respectively. Our Non-GAAP free cash flow was $26.8$48.5 million and $22.9$26.4 million in the threesix months ended AprilJuly 30,31, 2026 and 2025, respectively. See the section titled “— Non-GAAP Free Cash Flow” for additional information about how we calculate free cash flow, a non-GAAP financial metric, and a reconciliation to net cash provided by operating activities, the most directly comparable measure calculated in accordance with accounting principles generally accepted in the United States, or U.S. GAAP.

We believe there is substantial opportunity to continue to grow our customer base. We intend to continue to expand our customer base in verticals where we already have a strong presence, such as retail and consumer goods, media and entertainment, telecommunications, restaurants and on-demand services, healthcare and life sciences, technology, manufacturing, education, government and public services, and financial services — and to increase our presence in verticals where we are not yet strongly represented. Through our sales and marketing efforts, we also plan to capitalize on industries subject to ongoing digital transformation and where direct-to-consumer relationships are accelerating, to further propel adoption of our technology. As of AprilJuly 30,31, 2026, we had 2,7132,789 customers across a broad range of sizes and industries. Our ability to attract new customers will depend on a number of factors, including the quality and pricing of our products, offerings of our competitors and the effectiveness of our marketing efforts.

Historically, we have experienced significant expansion within a customer’s business once our platform is deployed, with customers typically increasing the number of monthly active users, channels and use cases, as well as purchasing additional products. A monthly active user is an end user of a customer who has engaged with the customer’s applications and websites in the previous thirty-day period. We include each distinguishable end user in our calculation of monthly active users, even though some users may access our customers’ applications and websites using more than one device, and multiple users may gain access using the same device. As of AprilJuly 30,31, 2026, we had approximately 8.59.0 billion monthly active users, up from the approximately 8.0 billion monthly active users as of January 31, 2026.

A further indication of the propensity of our customer relationships to expand over time is our dollar-based net retention rate. We calculate our dollar-based net retention rate as of a period end by starting with the ARR from the cohort of all customers as of 12 months prior to such period-end, or the Prior Period ARR. We then calculate the ARR from these same customers as of the current period-end, or 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. We then divide the total Current Period ARR by the total Prior Period ARR to arrive at the point-in-time dollar-based net retention rate. We then calculate 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. Our dollar-based net retention rate for the trailing 12 months ended AprilJuly 30,31, 2026 and AprilJuly 30,31, 2025 was 110% and 109%,108%, respectively, for all our customers, and 111%112% and 112%,111%, respectively, for our customers with ARR of $500,000 or more. In addition, 349361 and 262282 of our customers had ARR of $500,000 or more as of AprilJuly 30,31, 2026 and AprilJuly 30,31, 2025, respectively.

We believe there is a significant opportunity to continue to expand our presence in international markets we have already penetrated and by entering markets we have not yet penetrated. For the threesix months ended AprilJuly 30,31, 2026 and 2025, approximately 45% and 46%45% of our revenue was generated outside of the United States, respectively. We expect to increase market penetration in regions including Europe and Asia-Pacific and to further capitalize on the greenfield opportunities globally. Although these investments in geographic regions may negatively affect our operating results in the near term, we believe that they will contribute to our long-term growth.

General and administrative expenses consist primarily of personnel costs for finance, legal, human resourcesresources, and other administrative functions, as well as non-personnel costs such as legal, accountingaccounting, and other professional service fees, software costs, certain tax, license and insurance-related expenses and allocated overhead costs. Additionally, from time to time general and administrative expenses may include expenses associated with our donation of shares of Class A common stock to a charitable donor-advised fund in connection with our Pledge 1% commitment.

Comparison of the Three Months Ended AprilJuly 30,31, 2026 and AprilJuly 30,31, 2025

Revenue increased by $48.9$47.1 million, or 30.2%,26.2%, for the three months ended AprilJuly 30,31, 20262026, compared to the three months ended AprilJuly 30,31, 2025. Approximately 55.9%55.3% of the increase in revenue was attributable to the growth from existing customers and the remaining 44.1%44.7% was attributable to growth from new customers.

Cost of revenue increased by $21.5$17.2 million, or 42.2%,29.5%, for the three months ended AprilJuly 30,31, 2026, compared to the three months ended AprilJuly 30,31, 2025. This increase was primarily driven by a $9.2$7.4 million increase in third-party messaging fees associated with growth in premium messaging channels and an increase of $5.7$5.2 million in hosting, infrastructureinfrastructure, and other third-party fees associated with delivering our platform and services. In addition, we had an increase of $6.6$4.3 million in personnel costs, other overhead, and amortization expenses. The increased infrastructure, messaging, and personnel costs were incurred to support overall revenue growth.

Our gross profit increased $27.5$30.0 million, or 24.7%,24.6%, in the three months ended AprilJuly 30,31, 2026, compared to the three months ended AprilJuly 30,31, 2025, and our gross margin decreased 2.9%0.9% to 65.7%66.8% in the three months ended AprilJuly 30,31, 2026 from 68.6%67.7% in the three months ended AprilJuly 30,31, 2025. The decrease was primarily duedriven to acquisition related operating costs, includingby personnel costs ofrelated to the acquired workforce and amortization expense of acquired technology, offset by efficiencies realized in addition to increasedthe costs related to our tech stack.

Sales and marketing expense increased by $15.1$10.3 million, or 20.3%,12.4%, for the three months ended AprilJuly 30,31, 2026, compared to the three months ended AprilJuly 30,31, 2025. This increase was primarily due to an increase of $9.9$9.1 million in personnel costs and allocated overhead costs for our sales and marketing organization as a result of increased headcount and increased variable compensation for our sales personnel. Additionally, advertising, sales, marketing and promotional activities increased by $3.7 million.

Research and development expense increased by $9.3$4.0 million, or 25.3%,9.8%, for the three months ended AprilJuly 30,31, 2026, compared to the three months ended AprilJuly 30,31, 2025. This increase was primarily due to an increase of $7.5$2.5 million in personnel and allocated overhead costs, for our research and development organization as a result of increased headcount. Additionally, software services increased by $1.3 million.

General and administrative expense decreased by $9.6$5.0 million, or 23.7%,13.5%, for the three months ended AprilJuly 30,31, 2026, compared to the three months ended AprilJuly 30,31, 2025. This decrease was primarily due to a reduction of $9.7 million in professional services and legal costs primarily associated with prior period acquisition-related expenses, offset in part by an increase of $0.7$4.4 million in personnel and allocated overhead costs.costs as a result of one-time acquisition compensation related costs incurred in the period of acquisition and the completed vesting of legacy stock option awards.

The decrease in other income, net of $2.2$1.7 million, or 39.0%,42.3%, for the three months ended AprilJuly 30,31, 2026, compared to the three months ended AprilJuly 30,31, 2025, was attributable to a $1.5$1.7 million decrease in investment income from marketable securities. The investment income decrease was driven primarily by the decrease in the marketable securities balance period-over-period to fund acquisition activities.

As of AprilJuly 30,31, 2026, our principal source of liquidity was cash, cash equivalents, and marketable securities of $391.5$413.9 million. Our cash and cash equivalents consist of deposit accounts, interest-bearing money market accountsaccounts, and U.S. government and corporate securities that are stated at fair value. Our marketable securities positions consist mostly of highly liquid short-term investments. The investment income that we generate on these investments is not material to our overall cash balance, but may be adversely affected due to volatility in interest rates.

Since our inception, we have financed our operations primarily through the net proceeds received from the sales of equity securities and cash generated from the sale of subscriptions to our platform. We have generated losses from our operations as reflected in our accumulated deficit of $744.7$763.6 million as of AprilJuly 30,31, 2026. We had cash flows provided by operating activities for the threesix months ended AprilJuly 30,31, 2026 of $28.1$52.3 million.

A substantial source of our cash provided by operating activities is our deferred revenue, which is included on the consolidated balance sheets as a liability. Deferred revenue consists of the unearned portion of billed fees for our subscriptions, which is recorded as revenue over the term of the subscription agreement. As of AprilJuly 30,31, 2026, we had total deferred revenue of $342.5$346.7 million, recorded as a current liability. Deferred revenue will be recognized as revenue when all of the revenue recognition criteria are met.

For the threesix months ended AprilJuly 30,31, 2025,2026, net cash provided by operating activities was $24.1$52.3 million, primarily due to a net loss of $35.6$43.8 millionmillion, adjusted for non-cash charges of $43.8$109.9 millionmillion, and net changes in our operating assets and liabilities of $15.9$13.8 million. The non-cash adjustments primarily relate to stock-based compensation of $30.6$71.5 million and amortization of deferred contract costs of $9.4$25.1 million. The cash inflow from changes in our operating assets and liabilities were primarily due to a decrease in accounts receivable of $9.1$9.9 million and increase in deferred revenue of $24.5$42.5 million as a result of billings for new bookings and renewals. The cash inflow was offset by cash outflows primarily from an increase in deferred contract costs of $11.9$31.3 million as a result of commissions on new bookings and renewals.

Net cash provided by investing activities was $42.8$38.8 million for the threesix months ended AprilJuly 30,31, 2026, primarily consisting of the return of principal on marketable securities of $34.9$41.7 million and maturities of marketable securities of $35.9$58.9 million, partially offset by purchasespurchase of marketable securities of $26.7$58.0 million.

Net cash providedused byin investing activities was $122.8$37.7 million for the threesix months ended AprilJuly 30,31, 2025, primarily consisting of cash paid for the acquisition of OfferFit, net of cash acquired of $181.2 million, purchases of marketable securities of $75.1 million, purchases of property and equipment of $2.8 million, and capitalization of internal-use software costs of $1.9 million, offset by return of principal on marketable securities of $113.3$120.8 million and maturities of marketable securities of $63.2 million, partially offset by purchases of marketable securities of $52.4$102.5 million.

Net cash used in financing activities was $49.7$48.1 million for the threesix months ended AprilJuly 30,31, 2026, consisting primarily of cash outflow to fund the accelerated stock repurchase transaction of $50.0 million offset partially by proceeds from thestock exercisepurchases associated with our employee stock purchase plan of common stock options of $0.3$4.7 million.

Net cash provided by financing activities was $0.6$8.1 million for the threesix months ended AprilJuly 30,31, 2025, consisting of proceeds from the exercise of common stock options of $0.6$3.2 million and proceeds from stock associated with the employee stock purchase plan of $4.9 million.

Our free cash flow increased for the threesix months ended AprilJuly 30,31, 2026 from the threesix months ended AprilJuly 30,31, 2025, primarily due to higher collections as a result of an increase in billings that are aligned with new contracts and contract renewals. We expect our free cash flow to fluctuate in future periods with changes in our operating expenses and as we continue to invest in our growth. Additionally, our free cash flow may be influenced by macroeconomic factors that impact our collection efforts for customer payments. If we experience collection pressurepressure, it may lengthen the time to collect on accounts receivable and increase our bad debt expense, either of which could negatively impact our free cash flow.

We assess our liquidity primarily through our cash on hand as well as the projected timing of billings under contracts with our paying customers and related collection cycles. While our future capital requirements will depend on many factors, including revenue growth and costs incurred to support customer usage and growth in our customer base, increased research and development expenses to support the growth of our business and related infrastructure, and increased general and administrative expenses to support being a publicly-traded company, we believe our current cash, cash equivalentsequivalents, and marketable securities will be sufficient to meet our working capital and capital expenditure requirements for at least the next 12 months.

While we anticipate being able to satisfy our commitments through a combination of our available current cash, cash equivalents, and marketable securities, and cash generated from the sale of subscriptions to our platform, if our estimates prove to be inaccurateinaccurate, we may seek to sell additional equity or other securities that may result in dilution to our stockholders, issue debt or seek other third-party funding, in order to satisfy our future funding requirements.