8-K: Backblaze Reports Strong Q2 2026 Results, CoreWeave Deal Boosts Outlook

Backblaze announces robust second quarter 2026 financial results, driven by accelerated B2 Cloud Storage growth and a significant strategic agreement with CoreWeave.

Summary

• Backblaze reported strong financial results for the second quarter ended June 30, 2026, exceeding guidance for revenue and Adjusted EBITDA.
• Total revenue increased by 18% year-over-year to $42.7 million.
• B2 Cloud Storage revenue saw significant growth of 34% year-over-year, reaching $26.6 million.
• Computer Backup revenue decreased by 2% year-over-year to $16.1 million.
• Gross profit was $26.8 million (63% of revenue), with adjusted gross profit at $34.3 million (80% of revenue).
• Net loss narrowed to $5.1 million ($0.08 per share) from $7.1 million ($0.13 per share) in the prior year.
• Adjusted EBITDA more than doubled to $12.8 million (30% of revenue) from $6.6 million (18% of revenue) in Q2 2025.
• Non-GAAP net income was $5.0 million ($0.08 per share), a substantial increase from $0.8 million ($0.01 per share) in Q2 2025.
• Cash flow from operations for the first six months of 2026 was $13.8 million, up from $8.5 million in the same period of 2025.
• Adjusted free cash flow for the first six months of 2026 was $1.4 million, a significant improvement from $(6.0) million in the prior year.
• The company signed a 5+ year, $335 million strategic agreement with CoreWeave, including warrants valued at approximately $22 million.
• Annual recurring revenue (ARR) reached $177.3 million, up 21% year-over-year, with B2 Cloud Storage ARR growing 39% to $113.3 million.
• The company raised its full-year 2026 revenue guidance to $172.0 million $174.0 million and Adjusted EBITDA margin guidance to 27% 29%.

Sentiment

Score: 8

Explanation: StockSavvy.ai views this as a strong positive report, with significant revenue growth, improved profitability metrics, and a major strategic partnership that validates the company's role in the AI infrastructure stack.

Positives

• Revenue growth of 18% year-over-year to $42.7 million.
• Accelerated B2 Cloud Storage revenue growth of 34% year-over-year to $26.6 million.
• Significant increase in Adjusted EBITDA to $12.8 million (30% margin), up from $6.6 million (18% margin) in Q2 2025.
• Narrowed net loss to $5.1 million from $7.1 million in Q2 2025.
• Achieved non-GAAP net income of $5.0 million, a substantial improvement from $0.8 million in Q2 2025.
• Secured a major 5+ year, $335 million strategic agreement with CoreWeave, validating Backblaze's role in AI infrastructure.
• B2 Cloud Storage ARR grew by 39% year-over-year to $113.3 million.
• Raised full-year 2026 revenue guidance by over $10 million and increased Adjusted EBITDA margin outlook.
• Improved cash flow from operations to $13.8 million for the first six months of 2026.
• Turned positive on adjusted free cash flow ($1.4 million) for the first six months of 2026, compared to a negative $(6.0) million in the prior year.

Negatives

• Computer Backup revenue decreased by 2% year-over-year to $16.1 million.
• Net revenue retention rate (NRR) for the total company was 103%, down from 106% in Q2 2025.
• B2 Cloud Storage NRR was 113%, down from 114% in Q2 2025.
• Computer Backup NRR was 94%, down from 99% in Q2 2025.
• Computer Backup gross customer retention rate was 91%, only a slight increase from 90% in Q2 2025.

Risks

• The company's AI customer revenue is early-stage and widespread adoption is uncertain.
• There is no guarantee that the company will achieve the growth rates implied by current trends.
• Estimates of addressable market size and market opportunity may prove inaccurate or may not reflect actual market conditions.
• Sales and marketing and cost-saving initiatives may not achieve their intended results.
• New features and price changes may not have the anticipated impact.
• Supply availability, volatility, and pricing may adversely affect the business.
• The strategic agreement with CoreWeave involves a new delivery model and is subject to risks related to customer concentration, ramp timing, consumption levels, and the ability to scale operations.
• Rapidly evolving technological developments in the market, including advancements in AI, could impact the business.

Future Outlook

For the third quarter of 2026, Backblaze expects revenue between $44.4 million and $44.8 million, with an Adjusted EBITDA margin between 27% and 29%. For the full year 2026, the company has raised its outlook, expecting revenue between $172.0 million and $174.0 million and an Adjusted EBITDA margin range of 27% to 29%.

Management Comments

• "Q2 was an amazing quarter for Backblaze. We exceeded the high end of our revenue and Adjusted EBITDA guidance, with B2 growth accelerating to 34% year over year," said Gleb Budman, co-founder and CEO of Backblaze.
• "We also signed a $335 million strategic agreement with CoreWeave offering the strongest validation yet of our critical role in the AI infrastructure stack."
• "AI workloads need a capacity storage layer that can scale to exabytes, while delivering performance at attractive economics. That is where Backblaze is built to win."

Industry Context

StockSavvy.ai notes that Backblaze's results and strategic focus align with the significant growth and demand in the AI infrastructure sector, particularly for scalable and cost-effective storage solutions. The partnership with CoreWeave, a major player in AI compute, underscores the increasing importance of specialized storage providers in the AI ecosystem.

Comparison to Industry Standards

• Backblaze's B2 Cloud Storage revenue growth of 34% YoY significantly outpaces the general cloud storage market growth, which is typically in the mid-to-high teens.
• The Adjusted EBITDA margin of 30% is strong for a company in the infrastructure services sector, especially one experiencing rapid growth, indicating efficient operations.
• The Net Revenue Retention Rate (NRR) of 103% for the total company, while slightly down from the prior year, remains above the benchmark of 100% often considered healthy for subscription-based businesses, indicating that revenue from existing customers is growing.
• The company's focus on AI workloads positions it within a high-growth segment of the cloud computing market, where demand for exabyte-scale storage is rapidly increasing.

Stakeholder Impact

• Shareholders: Potential for increased value due to strong financial performance, improved outlook, and strategic partnership.
• Customers: Continued access to scalable and cost-effective storage solutions, with potential for new features and improved performance for AI workloads.
• Employees: Continued growth and investment in the company may lead to job creation and career development opportunities.
• Partners: The CoreWeave agreement signifies a strong partnership, potentially leading to further collaborations and market validation.

Next Steps

• Continue to scale operations to meet the demand for AI workloads.
• Leverage the strategic agreement with CoreWeave to expand market presence.
• Develop and ship new SDKs and AI agent tools to enhance the B2 developer ecosystem.
• Launch new features and offerings, including enterprise features and geographic expansion.
• Focus on achieving sustainable positive cash flow.

Key Dates

Recommendation

The company demonstrated strong execution in Q2 2026, exceeding guidance and showing significant acceleration in its core B2 Cloud Storage business. The landmark $335 million deal with CoreWeave is a major validation of Backblaze's strategic importance in the AI infrastructure stack and provides substantial revenue visibility. Coupled with raised full-year guidance and a positive shift to adjusted free cash flow, the outlook is very strong. While Computer Backup revenue is declining, the growth and strategic importance of B2 Cloud Storage, especially within the AI sector, more than compensate. The valuation, considering the growth trajectory and strategic positioning, appears attractive for a strong buy.

Keywords

cloud storage, B2 Cloud Storage, AI infrastructure, data storage, CoreWeave, revenue growth, Adjusted EBITDA, capacity storage