Financial Analysis

Business Combination Acquisition of OfferFit, Inc. On June 2, 2025 the Company acquired OfferFit, Inc. The acquisition was intended to deepen the integration of OfferFits multi-agent decisioning engine into Brazes Customer Engagement Platform. The total purchase price, as adjusted, of $303.2 million consisted of cash payments of $195.6 million, and $107.6 million in issuances of Braze Class A common stock. The purchase price, as adjusted, was allocated to intangible assets in the amount of $66.6 million and goodwill in the amount of $233.7 million based on the respective estimated fair values. The resulting goodwill is not deductible for income tax purposes. …

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Commitments and Contingencies Indirect Taxes We are subject to indirect taxation in certain U.S. states and foreign jurisdictions. We collect and remit Value Added Tax (VAT) or Goods and Services Tax (GST) in connection with certain of our foreign sales transactions and sales and use tax in connection with eligible sales to subscribers on applicable transactions. Following the U.S. Supreme Courts June 21, 2018 ruling in South Dakota v. Wayfair, which overruled Quill Corp v. North Dakota, states may now require remote sellers to collect sales tax under certain circumstances. We began collecting sales tax in relevant jurisdictions for the fiscal year ended January 31, 2019. We continue to evaluate jurisdictions in which indirect tax nexus exists and believe our indirect tax liabilities are adequate and reasonable. Due to the complexity and uncertainty in applying these rules, results may vary materially from expectations. Accordingly, we have recognized liabilities for contingencies related to state sales and use tax, VAT, and GST deemed probable and estimable totaling $1.5 million and $1.4 million as of July 31, 2026 and January 31, 2026, respectively, which is included in accrued expenses and other current liabilities on the consolidated balance sheets. Legal Contingencies From time to time, in the ordinary course of business, we are or may be involved in various legal or regulatory proceedings, claims or purported class actions related to, among other things, alleged infring …

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The following table presents total revenue by type (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 Subscription $ 207,664 $ 171,771 $ 402,849 $ 326,674 Professional services and other 19,566 8,340 35,380 15,496 Total $ 227,230 $ 180,111 $ 438,229 $ 342,170

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Employee Stock Plans We have historically issued equity awards under our Amended and Restated 2011 Equity Incentive Plan (the 2011 Plan) and our 2021 Equity Incentive Plan (the 2021 Plan). Amended and Restated 2011 Equity Incentive Plan Our 2011 Plan provides for the award of stock options and restricted stock units (RSUs) to employees, officers, directors, advisors and other service providers of Braze. The terms of each award and the exercise price of awards under the 2011 Plan are determined by our board of directors. Following effectiveness of the 2021 Plan in connection with our initial public offering, no further awards were made under the 2011 Plan. 2021 Equity Incentive Plan In November 2021, our board of directors and our stockholders approved the 2021 Plan, which became effective on November 16, 2021. No grants were made under the 2021 Plan prior to its effectiveness. No further grants will be made under the 2011 Plan. At effectiveness, we reserved 25,660,249 shares of our Class A common stock to be issued under the 2021 Plan. In addition, the number of shares of our Class A common stock reserved for issuance under the 2021 Plan will automatically increase on February 1 of each year for a period of ten years, beginning on February 1, 2022 and continuing through February 1, 2031, in an amount equal to (1) 5% of the total number of shares of our Class A common stock outstanding on the preceding January 31, or (2) a lesser number of shares determined by our board of dir …

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Fair Value Measurements The following table sets forth our financial instruments that were measured at fair value on a recurring basis at the periods indicated below, by level within the fair value hierarchy (in thousands): July 31, 2026 Level 1 Level 2 Level 3 Total Financial assets: Cash equivalents Money market funds $ 59,952 $ $ $ 59,952 U.S. government securities 1,999 1,999 Total cash equivalents 61,951 61,951 Marketable securities U.S. government securities $ 147,406 $ $ $ 147,406 Corporate debt securities 95,693 95,693 Total marketable securities 147,406 95,693 243,099 Derivative instruments Cash flow hedges $ $ 104 $ $ 104 Total financial assets $ 209,357 $ 95,797 $ $ 305,154 Liabilities: Derivative instruments Cash flow hedges $ $ (16) $ $ (16) Total liabilities $ $ (16) $ $ (16) January 31, 2026 Level 1 Level 2 Level 3 Total Financial assets: Cash equivalents Money market funds $ 39,538 $ $ $ 39,538 U.S. government securities 3,000 3,000 Total cash equivalents 42,538 42,538 Marketable securities U.S. government securities $ 189,238 $ $ $ 189,238 Corporate debt securities 98,342 98,342 Total marketable securities 189,238 98,342 287,580 Derivative instruments Cash flow hedges $ $ 409 $ $ 409 Total financial assets $ 231,776 $ 98,751 $ $ 330,527 Liabilities: Derivative instruments Cash flow hedges $ $ (25) $ $ (25) Total liabilities $ $ (25) $ $ (25) Our money market funds and financial instruments are classified as Level 1 within the fair value hierarchy, because the …

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Income Taxes The Company computes its provision for interim periods by applying an estimated annual effective tax rate to anticipated annual pretax income or loss as directed by ASC 740. The estimated annual effective tax rate is applied to the Companys year to date income or loss, and is adjusted for discrete items recorded in the period. The Company recorded an income tax expense / (benefit) of $2.5 million and $(7.0) million for the three months ended July 31, 2026 and 2025, respectively, and an income tax expense / (benefit) of $3.9 million and $(5.9) million for the six months ended July 31, 2026 and 2025, respectively. The effective tax rate for the three months ended July 31, 2026 and 2025 was (15.7)% and 20.2%, respectively. The effective tax rate for the six months ended July 31, 2026 and 2025 was (9.8)% and 8.6%, respectively. The provision for income taxes recorded for the three and six months ended July 31, 2026 consists of income taxes in state jurisdictions and foreign jurisdictions in which the Company conducts business. The primary difference between the effective tax rate and the statutory rate is the change in the valuation allowance recorded. The Company continues to maintain a valuation allowance against substantially all of its net deferred tax assets in jurisdictions where realization is not more likely than not. When the Company determines that it will be able to realize some portion or all of its deferred tax assets, an adjustment to its valuation allo …

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Leases Leases The Companys lease portfolio consists solely of operating leases for office space and finance leases for datacenter hardware equipment with lease terms in the portfolio ranging from approximately one to ten years. Certain lease agreements include options to renew or terminate the lease. The components of lease cost reflected on the consolidated statements of operations were as follows (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 Finance lease cost: Amortization of assets $ 294 $ $ 294 $ Interest on lease liabilities 106 106 Operating lease cost 4,955 4,668 9,839 9,189 Variable lease cost 1,125 1,095 2,122 1,962 Short-term lease cost 9 274 19 571 Total lease cost $ 6,489 $ 6,037 $ 12,380 $ 11,722 The future maturities of the Companys lease liabilities by fiscal year are as follows (in thousands): Finance Leases Operating Leases Remainder of 2027 $ 2,105 $ 9,345 2028 4,209 19,353 2029 4,123 17,124 2030 4,061 15,304 2031 3,707 13,261 Thereafter 27,612 Total future undiscounted lease payments $ 18,205 $ 101,999 Less: imputed interest (2,943) (20,854) Total reported lease liability $ 15,262 $ 81,145 The Company's lease terms and discount rates are as follows: July 31, 2026 2025 Weighted-average remaining lease term (years): Finance leases (1) 4.4 n/a Operating leases 6.1 6.8 Weighted-average discount rate: Finance leases (1) 8.2 % n/a Operating leases 7.7 % 7.4 % (1) The Company did not have finance leases during the three …

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Recently Adopted Accounting Pronouncements In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which intends to increase the transparency of income tax disclosures. Under the new guidance, entities must categorize and provide greater disaggregation of information in the rate reconciliation. They must also further disaggregate income taxes paid. For public business entities, it is effective for annual periods beginning after December 15, 2024. The Company adopted this standard on a prospective basis in its consolidated financial statements for the year ended January 31, 2026. The adoption of ASU 2023-09 did not have a material impact on the Company's consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU No. 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, (ASU 2024-03), which is intended to provide enhanced transparency into the nature of expenses and requires more detailed information on specific expense categories included in certain expense captions presented on the face of the income statement. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The standard may be applied either (1) on a prospect …

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Employee Benefit Plans We sponsor a 401(k) defined contribution plan covering all eligible U.S. employees. Contributions to the 401(k) plan are discretionary. Matching contributions under the plan were $1.2 million and $3.7 million for the three months ended July 31, 2026 and 2025, respectively, and $3.9 million and $6.0 million during the six months ended July 31, 2026 and 2025, respectively.

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Related Party Transactions In May 2021, the Chief Financial Officer of Datadog, Inc., one of our vendors, joined our board of directors. We have purchased services from Datadog, Inc. in the aggregate amount of approximately $1.2 million and $2.6 million during the three and six months ended July 31, 2026. During the three and six months ended July 31, 2025, we purchased $0.5 million and $1.7 million, respectively, of services from Datadog.

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Revenue from Contracts with Customers Disaggregated Revenue Streams The following disaggregation depicts the nature, amount, timing, and uncertainty of cash flows related to the primary types of revenue from contracts with customers. The following table presents total revenue by type (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 Subscription $ 207,664 $ 171,771 $ 402,849 $ 326,674 Professional services and other 19,566 8,340 35,380 15,496 Total $ 227,230 $ 180,111 $ 438,229 $ 342,170 The following table presents total revenue by geography (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 United States $ 125,561 $ 98,713 $ 241,067 $ 186,614 International 101,669 81,398 197,162 155,556 Total $ 227,230 $ 180,111 $ 438,229 $ 342,170 Revenue by geography is determined based on the location of our users. Other than the United States, no other individual country accounted for 10% or more of total revenue for any of the periods presented. Unbilled Accounts Receivable Unbilled accounts receivable is included in trade accounts receivable, net, which generally arise from our contractual right to bill our customers in advance of services on the contract effective date, were $4.2 million and $3.3 million as of July 31, 2026 and January 31, 2026, respectively. Contract Balances Contract Assets Contract assets as of July 31, 2026 and January 31, 2026 were $1.3 million and $1.3 million, respectively. The chan …

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Segments Operating segments are defined as components of an entity for which discrete financial information is available that is regularly reviewed by the Chief Operating Decision Maker (the CODM) in deciding how to allocate resources to an individual segment and in assessing performance. Our Chief Executive Officer is the CODM. The Company derives revenues from customers by providing cloud-based customer engagement platform subscriptions. The Company derives revenue primarily in North America and manages the business activities on a consolidated basis. As such, we have one operating segment, which is the customer engagement platform segment. The CODM reviews financial information presented on a consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance. Intra-entity activities are eliminated at the consolidated level. The Companys method for measuring performance on a single operating and reportable segment basis is net loss. Refer to the consolidated statements of operations. In assessing the performance of the business, the CODM regularly reviews consolidated expense information of both historical and forecasted periods to manage operations of the segment (i.e., the consolidated business). The CODM reviews assets for Brazes single reportable segment on a consolidated basis. Refer to the consolidated balance sheets. …

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Stockholders Equity Class A and Class B Common Stock Prior to January 30, 2026, the Company had two classes of common stock, Class A and Class B. On January 30, 2026, pursuant to the terms of the Companys Eighth Amended and Restated Certificate of Incorporation, each outstanding share of Class B common stock automatically converted into one share of Class A common stock (the Conversion). On January 30, 2026, the Company filed a certificate of retirement with the Secretary of State of the State of Delaware effecting the retirement of the shares of Class B common stock that were issued but no longer outstanding following the Conversion. Upon the effectiveness of the certificate of retirement, the Company (i) reduced the total number of authorized shares of the capital stock of the Company by 110,000,000, such that the total number of authorized shares of the Company is 2,010,000,000, consisting of (x) 2,000,000,000 shares of Class A common stock, and (y) 10,000,000 shares of preferred stock, and (ii) reduced the number of authorized shares of Class B common stock by 110,000,000, such that the number of authorized shares of Class B common stock is zero. Share Repurchase Program In March 2026, the Board of Directors authorized a share repurchase program (the Share Repurchase Program), under which the Company is authorized to repurchase up to $100.0 million of the Companys Class A common stock. Under the Share Repurchase Program, the Company may repurchase shares of the Companys C …

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Subsequent Events In August 2026, the Company granted RSUs for a total of 539,405 shares of Class A common stock to employees pursuant to the 2021 Plan. The RSUs vest over a service period of approximately three years. The grant date fair value of these awards was $16.8 million.

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