Braze acquires AI firm OfferFit for $325 million

NEW YORK - Braze (NASDAQ:BRZE), a customer engagement platform with a market capitalization of $3.9 billion and strong revenue growth of 28% in the last twelve months, has announced a definitive agreement to purchase OfferFit, a company specializing in AI decisioning, for $325 million, subject to customary closing adjustments. This move is expected to enhance Braze’s AI capabilities and extend its reach in personalized customer engagement. According to InvestingPro data, Braze maintains a healthy financial position with more cash than debt on its balance sheet, positioning it well for strategic acquisitions.

OfferFit, founded four years ago, has developed a multi-agent solution that tailors customer journeys across various channels. The integration of OfferFit’s technology with Braze’s platform is anticipated to bolster the latter’s Project Catalyst, an initiative to further personalize customer experiences through AI-driven Journeys, Content, and Incentives. With a current ratio of 1.99, Braze demonstrates strong liquidity to support this strategic expansion. For deeper insights into Braze’s financial health and growth potential, investors can access comprehensive analysis through InvestingPro, which offers exclusive access to over 30 key financial metrics and expert recommendations.

Braze’s co-founder and CEO, Bill Magnuson, highlighted the acquisition’s potential to redefine customer engagement with AI. He expressed enthusiasm about the future integration of reinforcement learning and modern transformer architectures within Braze’s product ecosystem.

George Khachatryan, co-founder and CEO of OfferFit, also expressed excitement about the merger, citing the potential to leverage Braze’s global scale and product ecosystem to enhance OfferFit’s offerings and contribute to BrazeAI.

The transaction, which involves a combination of cash and Braze Class A common stock, is expected to be finalized in the fiscal quarter ending July 31, 2025. Goldman Sachs & Co. LLC and Davis Polk & Wardwell LLP are advising Braze, while Atlas Technology Group and Latham & Watkins LLP are counseling OfferFit.

Additional information on the acquisition will be shared during Braze’s Fourth Quarter Fiscal Year 2025 Financial Results Conference Call, scheduled for today.

OfferFit’s AI Decisioning Engine represents an advanced approach to CRM marketing personalization, moving beyond traditional A/B testing to autonomous decision-making via reinforcement learning agents. The company has collaborated with prominent brands across various sectors, including telecom and financial services.

Braze’s platform enables marketers to engage with customers in real-time across channels, boasting cross-channel messaging, journey orchestration, and AI-powered experimentation. The company has received recognition for its workplace environment and has been named a leader in industry reports for marketing hubs and email marketing service providers.

This acquisition is expected to close subject to customary conditions, and the information is based on a press release statement. While Braze currently trades near its InvestingPro Fair Value, 16 analysts have revised their earnings upwards for the upcoming period, suggesting potential upside. The company’s gross profit margin stands at an impressive 69%, reflecting strong operational efficiency. Discover more exclusive insights and detailed financial analysis in the comprehensive Pro Research Report, available to InvestingPro subscribers.

In other recent news, Braze Inc. is set to release its fiscal fourth-quarter 2025 earnings report, an event highly anticipated by investors for insights into the company’s performance and future direction. Analysts from Citi have adjusted their price target for Braze to $50, maintaining a Buy rating, while noting expectations for a conservative growth outlook due to macroeconomic uncertainties and changes in sales leadership. DA Davidson also reiterated a Buy rating with a $50 price target, highlighting Braze’s potential to lead in the customer engagement sector with its expanding product suite. Oppenheimer analysts maintained an Outperform rating with a $51 target, expressing confidence in Braze’s potential to exceed Wall Street expectations in operating margin guidance despite anticipated revenue growth challenges.

Raymond James lowered its price target for Braze to $45, citing reduced growth projections for fiscal years 2026 and 2027, though it maintained an Outperform rating, emphasizing the company’s strategic initiatives. In addition to these analyst insights, Braze announced a strategic partnership with Shopify to enhance e-commerce marketing, integrating new features to provide real-time insights and personalized shopping experiences. This partnership aims to leverage Braze’s engagement tools alongside Shopify’s e-commerce capabilities, with new tools available to Shopify customers in early 2025. The collaboration is expected to improve identity management and personalization, benefiting brands like e.l.f. Beauty and Hugo Boss. The developments reflect Braze’s ongoing efforts to expand its market presence and adapt to the evolving needs of its customer base.

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