Braze Inc (NASDAQ:BRZE) stock rallies 14.81% (As on December 10, 11:20:44 AM UTC-4, Source: Google Finance) after the company reported better-than-expected third-quarter revenue and raised its full-year outlook, demonstrating strong momentum in customer acquisition and operational efficiency. The strong performance was driven primarily by new customer additions, upsells, and renewals, with total customer count growing 14% YoY to 2,528. The company demonstrated improved operational efficiency, reporting non-GAAP operating income of $5.1 million compared to a non-GAAP operating loss of $2.2 million in the same quarter last year. Free cash flow reached $17.8 million, a significant improvement from -$14.2 million in the year-ago period. Braze’s large customer segment showed particularly strong growth, with customers generating annual recurring revenue of $500,000 or more increasing 29% YoY to 303. The company’s dollar-based net retention rate stabilized at 108% for the trailing 12 months, compared to 113% in the year-ago period.

Moreover, Subscription revenue in the quarter was $181.6 million compared to $146.3 million in the third quarter of the fiscal year ended January 31, 2025, and professional services and other revenue was $9.2 million compared to $5.8 million in the third quarter of the fiscal year ended January 31, 2025. Remaining performance obligations as of October 31, 2025 was $891.4 million, of which $572.7 million is current, which the company defines as less than one year. Non-GAAP gross margin was 69.1% compared to 70.5% in the third quarter of the fiscal year ended January 31, 2025. Dollar-based net retention for all customers for the trailing 12 months ended October 31, 2025 and October 31, 2024 was 108% and 113%, respectively

BRZE in the third quarter of FY26 has reported the adjusted earnings per share of $0.06, which is inline with the analysts’ estimates for the adjusted earnings per share of $0.06. The company had reported the adjusted revenue growth of 25.5 percent to $190.8 million in the third quarter of FY26, missing the analysts’ estimates for revenue of $184.22 million.

Investors responded positively to Braze ’s upward revision of its full-year guidance, with the company now projecting revenue of $730.5-731.5 million, above the previous consensus of $718 million. The company also raised its adjusted earnings forecast to $0.42-$0.43 per share, compared to analyst expectations of $0.42.

For the fourth quarter, Braze expects revenue between $197.5-198.5 million and adjusted earnings per share of $0.13-$0.14, reflecting continued confidence in its growth trajectory and operational execution.