Backblaze reported Q1 2026 total revenue of $38.7 million, up 12% year over year, led by B2 Cloud Storage which grew about 24% to $22.4 million.

Excluding a large AI customer's peak usage in 2025, B2 Cloud Storage growth sits around 23%, while legacy Computer Backup declined about 2% year over year to $16.2 million as the company pivots toward higher-growth opportunities.

Overall year-over-year revenue rose 12% as B2 Cloud Storage accelerated, and profitability metrics improved despite the Computer Backup softness.

In executive discussions, traction with AI customers, price change impacts on growth, and drivers behind NRR and ARR were highlighted, with emphasis on expansion sales and refreshed ARR/RPO metrics.

Go-to-market transformation advanced under Anuj Kumar, appointing him Chief Revenue Officer to sharpen growth, with the Flamethrower program attracting more than 100 companies in under three months and pipeline from the installed base doubling year over year.

The GTM revamp aims for more consistent pipeline and efficient land-and-expand, led by the new CRO and the rapid Flamethrower program.

Pricing updates took effect May 1, removing API transaction fees and other packaging changes, expected to be accretive to revenue and margins; growth funding remains through operating cash flow and capital leases without new equity.

Notable AI-related wins added approximately $1 million ARR from an AI training data storage customer and about $500,000 ARR from another AI-focused client for model training data storage, signaling strong AI traction.

Concrete AI traction includes deals from a training data provider and an AI-powered video creation company, each contributing roughly $1 million and $500,000 ARR respectively due to cost and performance advantages.

Stock reacted positively, surging over 70% in after-hours trading to $7.59 and continuing gains after the earnings release.

Two methodology changes increased ARR visibility: annualizing ARR to 365 days added about $5 million to sequential ARR, and expanding RPO to capture annual and multi-year commitments lifted RPO to $76.5 million with $42.9 million due within a year.

As a result, ARR rose to $158 million and RPO grew by $6 million sequentially and $31 million year over year, with net retention in B2 at 110% up from 105% a year ago.