Backblaze (BLZE) AI Stock Analysis

• Market Cap: $249.11M
• Dividend Yield: N/A
• Average Volume (3M): 453.55K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.30
• Revenue Growth: 21.81%
• EPS Growth: 28.80%
• Country: US
• Employees: 346
• Sector: Technology
• Sector Strength: 67
• Industry: Software - Infrastructure
• EPS (TTM): -0.03
• Shares Outstanding: 54,869,606
• 10 Day Avg. Volume: 552,944
• 30 Day Avg. Volume: 453,548
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.23
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 4.42
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $10.00
• Price Target Upside: 91.57% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

Backblaze's strong revenue growth and strategic advancements, particularly in AI, are offset by profitability challenges and valuation concerns. The earnings call provided a positive outlook with improved financial metrics, but technical signals and market risks suggest caution.

Positive Factors

Financial Performance

Backblaze reported solid first-quarter results above the Street while providing second-quarter guidance roughly in line with consensus.

Revenue Growth

ARR grew 15% year-over-year, driven by continued progress across Backblaze’s recent go-to-market enhancements, sustained B2 Cloud momentum, and NRR of 113%.

Strategic Initiatives

Backblaze has begun to execute across the three key pillars of its go-to-market transition led by new CRO Jason Wakeam.

Negative Factors

Accounting Concerns

The analyst disagrees with the allegations of accounting malpractice at Backblaze and sees the share pullback as a buying opportunity.

GAAP Net Losses

Backblaze has a history of GAAP net losses, which is typical for subscale SaaS companies and not indicative of wrongdoing.

Share Dilution

The recent secondary offering added 7.2M shares to the share count, leading to a lower $11 price target due to dilution.

Backblaze Business Overview & Revenue Model

Company Description

Backblaze, Inc., a storage cloud platform, provides businesses and consumers cloud services to store, use, and protect data in the United States and internationally. The company offers cloud services through a web-scale software infrastructure built on commodity hardware. It also provides Backblaze B2 Cloud Storage, which enables customers to store data, developers to build applications, and partners to expand their use cases. This service is offered as a consumption-based Infrastructure-as-a-Service (IaaS) and serves use cases, such as backups, multi-cloud, application development, and ransomware protection. In addition, the company offers Backblaze Computer Backup that automatically backs up data from laptops and desktops for businesses and individuals, which provides a subscription-based Software-as-a-Service and serves use cases, including computer backup, ransomware protection, theft and loss protection, and remote access. It serves the public cloud IaaS storage and Data-Protection-as-a-Service markets. The company was incorporated in 2007 and is headquartered in San Mateo, California.

How the Company Makes Money

Backblaze generates revenue through its subscription-based pricing model for cloud storage and backup services. The company's primary revenue streams include personal backup plans, business backup solutions, and B2 cloud storage services. Customers subscribe to these services on a monthly or annual basis, providing a steady stream of recurring revenue. Backblaze's competitive pricing and straightforward service offerings attract a broad customer base, from individual users to large organizations. Additionally, Backblaze has formed strategic partnerships to enhance its service offerings and expand its market reach, further contributing to its revenue growth.

Backblaze Financial Statement Overview

Summary

Backblaze demonstrates strong revenue growth and improving cash flow, yet faces profitability challenges. Enhancing cost management and reducing dependency on debt could improve financial health. The company shows potential but must manage operational inefficiencies to achieve sustainable profitability.

Income Statement

Backblaze's revenue has shown a strong growth trend, with a 25.1% increase in TTM. However, profitability metrics like net and EBIT margins remain negative, indicating operational challenges. The gross profit margin has improved to 54.3%, which is a positive sign. Continuing to grow revenue while addressing cost efficiency could enhance future profitability.

Balance Sheet

The debt-to-equity ratio is 0.60, indicating moderate leverage. Stockholders' equity has significantly improved, but the equity ratio at 46.0% suggests potential reliance on debt financing. Improving profitability could enhance financial stability, but current liabilities remain substantial.

Cash Flow

Operating cash flow has turned positive in the TTM, a positive development from previous years. Free cash flow is positive, but the growth rate remains a concern. Cash flow ratios like operating cash flow to net income are favorable due to negative net income, but improving net income remains crucial.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
127.63M	102.02M	85.16M	67.48M	53.78M
	Gross Profit
69.34M	49.86M	43.86M	34.34M	27.98M
	EBIT
-46.29M	-57.91M	-48.41M	-18.79M	-3.73M
	EBITDA
-16.54M	-31.02M	-24.54M	-1.61M	9.22M
	Net Income Common Stockholders
-48.53M	-59.71M	-51.70M	-21.70M	-6.62M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
45.78M	29.30M	65.42M	104.84M	6.08M
	Total Assets
168.56M	131.69M	150.91M	163.58M	54.47M
	Total Debt
46.34M	46.85M	44.87M	33.25M	31.48M
	Net Debt
563.00K	34.35M	38.18M	-71.59M	25.40M
	Total Liabilities
90.94M	86.75M	82.36M	68.09M	61.31M
	Stockholders Equity
77.62M	44.94M	68.56M	95.49M	-6.84M
Cash Flow		Free Cash Flow
10.79M	-27.58M	-29.76M	-7.69M	7.84M
	Operating Cash Flow
12.51M	-7.35M	-13.78M	3.52M	12.82M
	Investing Cash Flow
-6.13M	21.66M	-73.85M	-11.19M	-4.97M
	Financing Cash Flow
22.77M	-8.84M	-6.21M	106.61M	-8.75M

Backblaze Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5.22
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BLZE, the sentiment is Positive. The current price of 5.22 is above the 20-day moving average (MA) of 4.59, above the 50-day MA of 4.98, and below the 200-day MA of 6.14, indicating a neutral trend. The MACD of -0.03 indicates Negative momentum. The RSI at 62.81 is Neutral, neither overbought nor oversold. The STOCH value of 70.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BLZE.

Backblaze Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DBX	74 Outperform	$8.29B	20.55	-60.11%	―	0.79%	0.59%
SWI	68 Neutral	$3.20B	28.86	7.87%	―	5.03%	―
AVPT	65 Neutral	$3.44B	―	-8.39%	―	21.70%	-67.95%
Sector *	60 Neutral	$10.94B	10.37	-6.73%	2.98%	7.75%	-12.61%
TENB	60 Neutral	$3.74B	―	-12.09%	―	11.79%	35.35%
BLZE	57 Neutral	$249.11M	―	-74.75%	―	21.81%	28.80%
KPLT	42 Neutral	$30.56M	―	86.76%	―	11.25%	34.57%

Backblaze Corporate Events

Backblaze Ends Loan Agreement After Successful Offering

Backblaze, Inc. has voluntarily terminated its Loan and Security Agreement with City National Bank. The termination follows the company’s successful follow-on public offering in November 2024, which raised approximately $37.5 million, allowing the company to fully pay down the revolving credit amount.