Backblaze (BLZE) 7 Nov 24 2024 Q3 Earnings call transcript
AInvestSaturday, Nov 9, 2024 9:41 am ET
2min read
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Backblaze, a leading cloud storage company, recently held its third quarter 2024 earnings call, highlighting the company's financial performance and future growth strategies. With revenue growth of 29% and an adjusted EBITDA margin of 12%, the company is on track to achieve significant milestones.

Driving Revenue Growth

During the call, CEO and Co-Founder Gleb Budman emphasized the importance of revenue growth, particularly in relation to Backblaze's B2 Cloud Storage. He introduced the new hires of Jason Wakeam as Chief Revenue Officer and Marc Suidan as Chief Financial Officer, who have been tasked with driving revenue growth and accelerating the path to free cash flow positivity.

Jason Wakeam's go-to-market transformation strategy includes a focus on upskilling, partnerships, and sales plays. The team has seen immediate results, including record-breaking annual contract value wins and a record pipeline of 7-figure opportunities. By prioritizing reseller partnerships and aligning sales efforts with marketing strategies, Backblaze is poised for increased sales productivity and revenue growth.

Cost Efficiencies and Operational Improvements

Marc Suidan, the new CFO, discussed his findings on Backblaze's cost structure and the need for operational improvements. He initiated a zero-based budgeting exercise to optimize expenses and enhance operating leverage. These efforts are expected to accelerate Backblaze's path to profitability, with a goal of becoming a Rule of 40 company over time.

Expanding into New Markets and Industries

Backblaze also announced the opening of a new data center region in Canada, expanding its services to customers looking to keep their data within the country. This move aligns with the company's strategy of addressing data sovereignty requirements and growing its presence in international markets. Additionally, Backblaze's partnership with Opti9, the largest Veeam Managed Service Provider in Canada, highlights the company's commitment to providing comprehensive cloud storage solutions for various use cases.

Innovation and Strategic Partnerships

The call also touched on Backblaze's innovation and strategic partnerships, particularly in the AI industry. With the amount of data stored with AI customers more than doubling year-over-year, Backblaze's cost-effective solution is increasingly popular among AI companies. The company's ability to support specialized GPU clouds and allow customers to use their data concurrently has resulted in significant revenue growth, underscoring the strategic importance of AI in Backblaze's growth strategy.

Future Outlook

Looking ahead, Backblaze is optimistic about its future. The company's focus on revenue growth, cost efficiencies, and strategic partnerships positions it well to capture a significant share of the $55 billion cloud storage market. With a robust product offering, a talented leadership team, and a clear understanding of market trends, Backblaze is poised for continued success.

Overall, Backblaze's earnings call provided a comprehensive update on the company's financial performance and strategic initiatives. With a strong focus on revenue growth, cost efficiencies, and strategic partnerships, Backblaze is well-positioned to capitalize on the growing demand for cloud storage solutions. Investors and stakeholders will be eagerly watching the company's progress as it continues to transform its go-to-market strategies and expand its presence in key markets.

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