Backblaze (BLZE) Stock Forecast & Price Target

Backblaze Inc has demonstrated consistent revenue growth, maintaining a year-over-year increase of at least 20% annually over the past five years, with expectations for this growth to persist through FY25. The company's B2 Cloud Storage revenue is projected to accelerate, reaching a minimum of 30% year-over-year by the fourth quarter of FY25, underscoring strong demand for its services. Moreover, as evidence of rising traction, Backblaze has seen a substantial 66% increase in AI customers and a remarkable 25-fold growth in AI customer data year-over-year, further supported by the introduction of the B2 Overdrive offering tailored for multi-petabyte storage needs.

Backblaze Inc has consistently experienced a lack of profitability, with historically negative free cash flow and earnings reported over multiple periods. The company's Computer Backup service, which is a significant revenue driver at 48% in F1Q25, is projected to face slowing growth, expected to decline to single-digit ranges in the coming years. Furthermore, the substantial costs associated with maintaining its extensive infrastructure result in considerable depreciation, adversely affecting its GAAP gross margins.