Braze Revenue Jumps 24 Percent in Q2

Braze (NASDAQ:BRZE) reported fiscal 2Q2026 results on September 4, 2025, with revenue of $180 million, up 24% year-over-year, and non-GAAP operating income of $6 million. The company’s customer count rose to 2,422, including early contributions from OfferFit, and raised its full-year FY2026 guidance for both revenue and non-GAAP operating profit while emphasizing strong execution, improved sales productivity, and progress in AI-led product development and integration.

Annual recurring revenue tops $700 million as Braze expands large customer base

Annual recurring revenue (ARR) surpassed $700 million, supported by a 27% year-over-year increase in customers with $500,000-plus ARR to 282, which now represent 62% of total ARR. The company's total customer count grew by 12% year-over-year, aided by both organic wins and the addition of OfferFit’s customer portfolio.

"I'm also pleased to announce that we recently passed $700 million of committed annual recurring revenue, demonstrating continued strong demand for the ROI delivered by the Braze customer engagement platform. Thank you to our dedicated team across the world who helped us achieve this milestone."
-- William Magnuson, Chief Executive Officer

The sustained expansion of high-value enterprise customers not only boosts revenue stability but also enhances Braze's multi-year contract visibility.

Braze drives operational leverage with OfferFit integration and sales execution

Excluding a $2.8 million OfferFit contribution, organic revenue grew 22% year-over-year, while OfferFit added 17 net new customers and two net new large clients, validating early cross-sell initiatives. Non-GAAP sales and marketing efficiency improved to 39% of revenue (down 1 percentage point year-over-year) despite absorbing new integration-related costs.

"The OfferFit integration is performing extremely well. We've onboarded Ed McDonnell, which is going very, very well. And so we know these were some sources of some uncertainty over the last few months. That's now behind us. And we're really pleased with our plan for capital deployment through the back of the year. And so when you combine that visibility and transparency with some of the upside that we're seeing on the revenue piece, that's how you come up with the improved profitability, and we're excited to be on that path."
-- Isabelle Winkles, Chief Financial Officer

The successful and rapid consolidation of OfferFit is reducing execution risk.

AI investments drive Braze product leadership and customer retention

Braze emphasized rapid adoption of AI-powered features across verticals, highlighting proprietary technologies spanning recommendation engines, reinforcement learning, and generative AI. AI is also reducing barriers for new customers and unlocking broader usability of legacy capabilities, with management noting the closing of previous customer apprehension gaps.

"can make full use of Braze. And I think our AI road map has tremendous promise to close that gap, both by lowering the barriers to entry for those more sophisticated features as well as decreasing the manual effort required to test and deploy both new use cases and run ongoing experiments. And so I think we've been really happy primarily with continuing to see that gap being closed where the differentiation that Braze has always been able to deliver due to our power and our flexibility is becoming more accessible to more of our customer base. And that's giving us both stronger differentiation in sales cycles, but also stronger usage and ongoing value creation for our customers, not just from the AI features, but from the existing differentiation that we already had, but that was maybe not as accessible or as usable and AI is helping really close that gap."
-- William Magnuson, Chief Executive Officer

The velocity of AI-driven product advancements fortifies Braze’s competitive moat, deepens customer entrenchment, and positions the company to capture incremental share as enterprises seek out vendors capable of delivering actionable, real-time personalization at scale.

Looking Ahead

For Q3 FY2026, Braze projects revenue of $183.5 million to $184.5 million (up approximately 21% year-over-year at midpoint) and non-GAAP operating income of $3.5 million to $4.5 million, reflecting the impact of event-related expenses. For full-year FY2026, guidance calls for $717 million to $720 million in revenue (21% year-over-year growth at the midpoint), non-GAAP operating income of $24.5 million to $25.5 million, and non-GAAP net income of $45.5 million to $46.5 million. Management reaffirmed that OfferFit will contribute approximately two percentage points to top-line growth in FY2026 and highlighted the upcoming Forge conference for the unveiling of further AI innovations and partner initiatives.

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This article was created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Braze. The Motley Fool has a disclosure policy.