# Growth accelerates at Backblaze > Source: > Published: 2026-08-04 13:21:07+00:00 # Growth accelerates at Backblaze [Backblaze](https://www.blocksandfiles.com/public-cloud/2026/05/05/backblaze-beats-guidance-as-ai-drives-growth/5219234) increased revenues Y/Y in its second 2026 quarter by 18 percent as growth accelerated, with its full year outlook raised to an almost 19 percent growth, as providing cloud storage for AI-generated data resonated with neocloud and other AI factory type customers. Revenues of $47.2 million beat its high-end $40.2 million outlook and there was a GAAP net loss of -$5.1 million, better than the year-ago $7.1 million loss and the previous quarter’s $6.1 million loss. The company has two business units. B2 Cloud Storage pulled in $22.4 million, up 34% Y/Y while fading star Computer Backup revenues declined 2.2 percent to $16.14 million. Co-founder and CEO Gleb Budman said: “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 percent year over year. We also signed a $335 million strategic agreement with [CoreWeave](https://www.blocksandfiles.com/public-cloud/2026/06/23/backblaze-gets-335-million-coreweave-bonanza/5260288https://www.blocksandfiles.com/public-cloud/2026/06/23/backblaze-gets-335-million-coreweave-bonanza/5260288) 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.” Backblaze software and people are embedded in CoreWeave data centers in a managed storage aspect of the deal, with a 70/30 split, 30 being the managed services. Suidan said: "The managed storage portion of the CoreWeave agreement is delivered on customer-owned hardware." Budman amplified the point: "The way that it works is they provide us the data center space. They provide us how much storage they would like. We provide the build materials. They buy the equipment. They hand it to us, it’s actually our people in that part of the data center, which is cordoned off for our purposes. It’s our people racking, stacking, managing with our software, that part of the storage stack. CoreWeave will have multiple parts of their storage stack. We’ll have the part that we’re managing. They will own the equipment, we will have the people." Backblaze is offering similar managed storage deals to other customers. These support sovereign cloud requirements and are capital-light from Backblaze's point of view. Backblaze has issued share purchase warrants at a fixed price to CoreWeave so that CoreWeave can get a potential equity profit if their partnership is a success and Backblaze stock price rises. Suidan said: "The warrants reflect the strategic and mutually beneficial nature of the relationship and align both companies around the long-term success of the agreement." Budman [said](https://uk.investing.com/news/transcripts/earnings-call-transcript-backblaze-tops-q2-2026-estimates-and-lifts-outlook-93CH-4806591): "CoreWeave is now the fourth major AI cloud infrastructure company to contract with Backblaze. We’re in conversations with many of the leading other ones." He reckons that, as AI scales, data grows, and as AI companies mature, storage efficiency matters. They can’t keep all their data on flash. Financial summary Gross margin: 63 percent vs year-ago 63 percent Operating cash flow: $10.4 million vs $3.4 million last quarter and year-ago $3.6 million Adjusted free cash flow: $3.2 million vs last quarter’s -$1.8 million and year-ago -$3.9 million Cash, cash equivalents, and marketable securities: $50.0 million vs last quarter’s $45.5 million CFO Marc Suidan said the quarter's results "represented our strongest growth in six quarters." A new CRO and go-to-marke team are having positive results. The company is moving up-market and growth indicators are accelerating. The large customer count, ones with >$50,000 ARR, shot up from 187 last quarter to 235, a 25.7 percent Q/Q rise and a 57 percent Y/Y increase. There were 4 wins in the quarter for $500,000 ARR deals. A chart showing quarterly B2 Cloud Storage and Computer Backup revenues shows them markedly diverging. The company increased its prices in May but hasn't seen an adverse effect with Suidan saying: "We anticipated some churn. We really haven’t seen any churn. In fact, what we’ve seen is an acceleration of people signing up. … It’s broad-based, the general business health. We’re seeing really healthy acceleration." The Q3 revenue outlook is $44.6 million +/- $200K , up 19 pertcent Y/Y at the mid-point, and the full year outlook has been raised a second time, from last quarter's $162 million ± $1 million to $172 million +/- $1 million, an 18.7% increase Y/Y. Growth could accelerate. Suidan said signed commitments enable the B2 revenue growth outlook to be >40 percent in 2027.