Citi analyst Tyler Radke reiterated a Buy rating and $48.00 price target on Braze Inc (NASDAQ: BRZE).

Radke's note highlighted comments from Braze co-founder and CEO Bill Magnuson covering several operational topics. Magnuson noted that organic current remaining performance obligation growth moderated two points sequentially, partly due to unusually large and partially pulled-forward renewal volumes in the fourth and first quarters, while reiterating strong bookings momentum and a second-half pipeline.

On revenue classification, Magnuson said an increase in professional-services revenue reflects pricing and packaging changes rather than a strategic shift. Certain recurring advisory offerings previously bundled within subscriptions are now separately classified as professional services. On a comparable basis, he indicated professional services would represent 4–5% of revenue absent the reclassification.

Regarding margins, Magnuson expects normal seasonal gross margin pressure in the fourth quarter driven by higher messaging volumes and infrastructure utilization during the holiday period. He noted the company chose not to pass through the full second-quarter margin beat as it begins ramping fiscal year 2028 sales capacity earlier than usual, citing a competitive market for AI-software sales talent.

Magnuson also addressed Braze's Operator product, which he said is designed to help customers apply AI to existing workflows such as onboarding, abandoned-cart, and cross-sell programs. He cited one customer using Content Optimizer in an SMS welcome flow that generated more than 80% uplift in both clicks and conversions.

The CEO noted that AI is now involved in every deal cycle, with conversations focused on marketer productivity and campaign performance. Magnuson also referenced the company's upcoming Forge user conference in late September, where he said more information on products including Headless Operator, MCP server, and Decisioning Studio will be shared.