BLZE · Backblaze, Inc. · Stock research

Current Thesis

The binary flagged in the prior note resolved in the bulls' favour. Backblaze reported Q2 2026 on 2026-08-03: revenue $42.713M against $39.935M consensus and its own $39.8–40.2M guide, adjusted EPS $0.08 against a −$0.10 consensus, adjusted EBITDA $12.8M at a 30% margin, and B2 Cloud Storage revenue $26.6M growing 34% YoY — per company commentary the fastest B2 growth in seven quarters. FY26 revenue guidance went to $172–174M from $161.5–163.5M, and the FY26 adjusted EBITDA margin guide to 27–29% from 23–25%. Q3 guidance of $44.4–44.8M sits well above the $41.195M consensus. The CoreWeave agreement added $313M to remaining performance obligations, net of $22M of warrant value. Four price targets moved on 2026-08-04 — Oppenheimer $25, B. Riley $24, Needham $23, Citizens $21 — and the stock now trades below that cluster at the 2026-08-14 reference close of $19.02, where in mid-July it traded above the entire $14–16 band. The narrative leg being bought is no longer "one whale re-rated the multiple"; it is "the white-label neocloud storage tier is a compounding line item, and the numbers confirmed it before the next customer was even named." The next dated event is Investor Day on 2026-09-09.

Bullish and bearish views on Backblaze, Inc.

The model's bull view on Backblaze, Inc. (BLZE), in brief: Q2 2026 (2026-08-03): revenue $42.713M, +18% YoY, $2.5M above the top of company guidance; adjusted EPS $0.08 versus −$0.10 consensus; adjusted EBITDA $12.8M at 30% margin, roughly 700bps above the high end of guidance. The bear view: The move is large and recent: +170.6% over three months into the 2026-08-14 close of $19.02, with RSI(14) at 71.1 and price 6.9% under the $20.43 52-week high. Both cases follow in full.

Bull Case

• Q2 2026 (2026-08-03): revenue $42.713M, +18% YoY, $2.5M above the top of company guidance; adjusted EPS $0.08 versus −$0.10 consensus; adjusted EBITDA $12.8M at 30% margin, roughly 700bps above the high end of guidance.
• B2 Cloud Storage revenue $26.6M, +34% YoY, an acceleration from the +24% posted in Q1 2026 (reported 2026-05-05) — the segment carrying the AI story is speeding up, not decelerating, which was the specific bear condition set out in the prior note.
• Guidance raised twice in one release: FY26 revenue to $172–174M (from $161.5–163.5M) and FY26 adjusted EBITDA margin to 27–29% (from 23–25%). Q3 guide $44.4–44.8M against $41.195M consensus.
• CoreWeave contributed $313M to RPO net of $22M warrant value — a contracted backlog datapoint rather than a press-release headline number, and the five-year ~$335M agreement was signed after the original FY26 guide was set.
• Enterprise cohort expanding: 235 customers at $50k+ ARR, up 57% YoY, with ARR from that cohort up 67% YoY; B2 net revenue retention 113% (Q2 2026 investor presentation).
• Post-print target cluster moved as a group on 2026-08-04 — Oppenheimer $25 (Outperform), B. Riley $24 (Buy), Needham $23 (Buy), Citizens $21 (Market Outperform) — versus the $14–16 band that stood before the print and the $8–11 band before the CoreWeave deal.
• Management guided to B2 growing more than 40% YoY in 2027 (Q2 2026 slides), which frames the CoreWeave ramp as a 2027 revenue event rather than a 2026 one.

Bear Case

• The move is large and recent: +170.6% over three months into the 2026-08-14 close of $19.02, with RSI(14) at 71.1 and price 6.9% under the $20.43 52-week high. Ten trading sessions after a beat-and-raise plus four target hikes, the stock has not made a new high.
• Registered supply arrived the same day as the print. The 2026-08-03 S-3 registers up to 4,194,876 Class A shares for resale by CoreWeave: 3,053,314 Initial Warrant Shares (exercise price $7.60, vesting in twenty equal quarterly instalments so long as the Master Strategic Agreement remains in effect, expiring 2032-06-16) plus 1,141,562 Additional Warrant Shares (capacity-milestone vesting, expiring 2035-06-16). Backblaze receives no proceeds from resales. The strike sits far under the current quote.
• Total revenue grew 18% YoY while B2 grew 34% — the legacy Computer Backup business is diluting the blended growth rate, and the multiple is being set off the faster segment.
• GAAP economics still negative: net loss $5.09M in Q2 2026 even as adjusted EBITDA printed $12.8M; adjusted free cash flow was $3.2M, an 8% margin.
• Customer concentration is now structural, not incidental. A single neocloud counterparty is both the largest contract in company history and a warrant-holding shareholder with registered resale rights.
• The next hard number is roughly three months away. Between now and the Q3 print, the story is carried by a presentation (2026-09-09) and by whether an unscheduled second at-scale neocloud win lands.

Setup & Price Structure

The narrative is accelerating, and dated. The evidence for the label is the 2026-08-03 acceleration in B2 growth (+34% YoY versus +24% in Q1), the double guidance raise on the same date, the four same-day target increases on 2026-08-04, and a fresh unresolved catalyst announced 2026-07-30 for 2026-09-09. The estimate-revision cycle is still moving up. What separates this from a clean acceleration read is the price behaviour after the news: the 52-week high of $20.43 was set into the print reaction and the 2026-08-14 close of $19.02 is 6.9% beneath it, so the tape has absorbed rather than extended the beat. If the next leg is made on headlines without a second named at-scale customer, the honest label shifts toward maturing.

Crowding and positioning observables, stated as observables: RSI(14) 71.1 on 2026-08-14 after a 170.6% three-month advance; price below the entire post-print target band of $21–25, having traded above the pre-print $14–16 band in mid-July; a resale registration for up to 4,194,876 Class A shares filed 2026-08-03 with a $7.60 warrant strike; no earnings date inside the next 30 days; and short interest last reported near 2.4% of float in the late-July data, which is not the structure a squeeze runs on. Mainstream coverage has been present since Cramer flagged the valuation cohort on 2026-06-04.

Structure: the mid-July high near $17.98 is the shelf the August print gapped over. That shelf, not the 52-week high, is the reference the post-Q2 leg is standing on.

Catalyst Calendar (next 30 days)

• 2026-09-09 — Investor Day, New York, 9:30 a.m. ET, webcast on ir.backblaze.com (announced 2026-07-30). The dated venue for a 2027 framework, a B2 Neo pipeline update, and any second at-scale neocloud name.
• ~2026-09-16 (est.) — the next 5% quarterly instalment of CoreWeave's Initial Warrant vests under the twenty-instalment schedule dated from 2026-06-16, incrementally enlarging registered resale supply at a $7.60 strike.
• ~2026-11-04 (est.) — Q3 2026 print. Outside the 30-day window, and the first test of the $44.4–44.8M guide.

Elapsed catalysts

• Unscheduled — a second Tier-1 neocloud white-label contract (Crusoe / Nebius / Lambda-class). The CoreWeave deal itself arrived unscheduled on 2026-06-23; this is the single announcement that would convert "bespoke deal" into "platform". (passed 64d ago)

What Would Change Our Mind

The fundamental break is narrower now that Q2 is on the tape — B2 Cloud Storage growth printing back under 30% YoY at the Q3 report, or an FY26 guide walk-back from the $172–174M range, would contradict the acceleration that justified the re-rating. The catalyst break is 2026-09-09 passing with no second at-scale neocloud customer, no 2027 revenue framework, and no further target increases, which would date the shift from accelerating to maturing. A visible CoreWeave resale block under the 2026-08-03 registration would be a separate, observable supply event rather than a thesis break, but it changes who is on the other side of the bid.

Correlation Notes

• Trades with the neocloud complex: CoreWeave is simultaneously the anchor customer, a warrant holder and a registered seller, so CRWV newsflow on capex, financing or contract terms transmits directly. Nebius and other GPU-cloud names set the sentiment tone for the lane.
• Second-order exposure to the HDD cycle (Seagate, Western Digital): B2 Neo supplies dense disk tiers, so drive pricing and supply are a cost input, not a demand driver — a rising HDD price environment pressures the 63% gross margin.
• Small-cap AI infrastructure beta: a Russell 2000 constituent with a $1B-area capitalisation and a 170.6% three-month move, it carries the liquidity profile of the small-cap AI cohort, which historically de-rates faster than large-cap AI infrastructure on risk-off days.
• Inversely exposed to hyperscaler storage price cuts: AWS S3, Google Cloud and Azure list-price moves compress the value proposition of the low-cost tier that B2 sells against.