Backblaze (BLZE) risk factors, FY2025 10-K

Backblaze's FY2025 10-K, filed Mar 10, 2026, lists 55 risk factors in 5 groups. Against the prior year's 54: 5 new, 4 dropped, 23 substantially reworded.

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Risk factors listed
555 groups
New this year
5vs 54 last year
Dropped
4since the prior 10-K
Substantially reworded
23of those kept
Section length
21k wordsItem 1A

What the changes say

  • Backblaze is managing headcount reductions while expanding its focus on AI model builders and neocloud partners.
  • The company faces new operational constraints from a $20 million credit facility and potential short seller manipulation.
  • Tax legislation like the OBBB Act will affect net operating losses.

What changed since the prior 10-K

New

  • NewRisks Related to Our Business and Our Industry

    If we fail to effectively manage our workforce and operational needs, our business would be harmed

    Headcount reductions, hiring freezes, and workforce transitions risk causing a loss of institutional knowledge, reduced execution capacity, and lower employee morale.

  • NewRisks Related to Our Business and Our Industry

    We use AI technologies internally to increase employee productivity and efficiency, but our business is also increasingly exposed to risks related to our customers, including neocloud partners and AI model builders, and their use of AI on our platform, any of which could harm our business

    Serving AI model builders and neocloud platforms via the Powered by Backblaze program and B2 Neo exposes the company to evolving regulations like the EU AI Act.

  • NewRisks Related to Our Business and Our Industry

    Changes in global trade policies, including the imposition of tariffs and other trade restrictions, may adversely affect our business

    Global trade policies and tariffs on foreign components and hardware vendors could increase direct costs and delay vendor deliveries.

  • NewRisks Related to Our Business and Our Industry

    Restrictive covenants under our credit facility may constrain our strategic and operational flexibility

    A senior secured revolving credit agreement with Citizens Bank for up to $20 million imposes strict financial covenants and limits corporate flexibility.

  • NewRisks Related to Ownership of Our Common Stock

    Our stock and business may be adversely affected by the actions of third parties attempting to manipulate our share price

    Short sellers and third parties may manipulate share prices using false reports, prompting short-and-distort campaigns and fee-chasing litigation.

Dropped

  • DroppedRisks Related to Our Business and Our Industry

    If we fail to effectively manage our growth, our business would be harmed

  • DroppedRisks Related to Our Business and Our Industry

    We are an emerging growth company, and any decision on our part to comply only with certain reduced reporting and disclosure requirements applicable to emerging growth companies could make our common stock less attractive to investors

  • DroppedRisks Related to Accounting and Tax Matters

    If we fail to maintain an effective system of disclosure controls and internal control over financial reporting, we may be unable to produce timely and accurate financial statements or comply with applicable regulations, which could negatively impact the price of our common stock

  • DroppedRisks Related to Ownership of Our Common Stock

    of information in filings required of a public company, our business and financial condition has become more visible, which may result in threatened or actual litigation, including by competitors

Reworded

  • 82% rewrittenRisks Related to Accounting and Tax Matters

    The failure to maintain effective internal controls over financial reporting could harm our business and negatively impact the value of our common stock

    Added explicit mention that the auditor attestation requirement for internal controls is exempt while an emerging growth company.

  • 76% rewrittenRisks Related to Reliance on Infrastructure and Third Parties

    We rely on third-party systems for certain essential financial and operational services, and a failure or disruption in these services could materially and adversely affect our ability to manage our business effectively

    Added Stripe as a payment processor and warned of risks from payment processing fees, delays, and credit card transaction failures.

    Was: We rely on third-party software for certain essential financial and operational services, and a failure or disruption in these services could materially and adversely affect our ability to manage our business effectively

  • 66% rewrittenRisks Related to Reliance on Infrastructure and Third Parties

    We are an emerging growth company, which provides, among other things, reduced disclosure requirements, and any decision on our part to comply only with reduced reporting and disclosure requirements applicable to such companies could make our common stock less attractive to investors

    Updated qualification date to June 30, 2025.

  • 63% rewrittenRisks Related to Accounting and Tax Matters

    Changes in tax laws and related matters could materially affect our financial condition, results of operations and cash flows

    Added the July 2025 enactment of the One Big Beautiful Bill Act (OBBB Act) and its expected impact on net operating losses and valuation allowances.

  • 52% rewrittenRisks Related to Our Business and Our Industry

    Any significant disruption in our service or loss, or delay in availability of our customers’ data, could damage our reputation and harm our business and operating results

    Retained prior year risk regarding service disruptions without textual changes.

  • 51% rewrittenRisks Related to Our Business and Our Industry

    We rely on the performance of key personnel, including our management and other key employees, and the loss of one or more of such personnel, or of a significant number of our team members, could harm our business

    Added that November 2024 and November 2025 restructurings and reductions in force create organizational disruption and employee turnover.

  • 47% rewrittenRisks Related to Ownership of Our Common Stock

    The requirements of being a public company, particularly after we are no longer an “emerging growth company,” may strain our resources, require us to incur substantial costs and will require substantial management attention

    Updated references from the Dodd-Frank Wall Street Reform and Consumer Protection Act to Dodd-Frank and shortened Nasdaq Global Market to Nasdaq.

  • 41% rewrittenRisks Related to Our Business and Our Industry

    To the extent we target different types of customers, we may face increased demands and challenges that adversely impact our business and operations

    Retained prior year risk regarding targeting larger enterprise customers without textual changes.

  • 41% rewrittenRisks Related to Our Business and Our Industry

    We may require additional capital to support our operations or the growth of our business, and we cannot be certain that this capital will be available on reasonable terms when required, or at all

  • 39% rewrittenRisks Related to Our Business and Our Industry

    Uncertainty in general economic conditions may adversely impact our revenue and profitability

    Was: Adverse economic conditions may adversely impact our revenue and profitability

  • 38% rewrittenRisks Related to Our Business and Our Industry

    Our business could be materially harmed to the extent that we do not effectively manage our data center capacity and the costs associated with our data center spaces

    Was: Our business could be materially harmed to the extent that we do not effectively manage our data center capacity and the costs associated with our data centers

  • 37% rewrittenRisks Related to Accounting and Tax Matters

    If our estimates or judgments relating to our critical accounting estimates prove to be incorrect, our results of operations could be adversely affected

  • 37% rewrittenRisks Related to Accounting and Tax Matters

    Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited

  • 33% rewrittenRisks Related to Reliance on Infrastructure and Third Parties

    Our business is exposed to risks associated with online payment processing methods

  • 33% rewrittenRisks Related to Our Business and Our Industry

    Our quarterly results may fluctuate significantly and may not fully reflect the underlying performance of our business

  • 29% rewrittenRisks Related to Our Business and Our Industry

    If we are unable to provide successful enhancements, new features, and modifications to our cloud services, our business could be adversely affected

  • 28% rewrittenRisks Related to Reliance on Infrastructure and Third Parties

    We rely on third-party vendors and suppliers, including data center and hard drive providers, which may have limited sources of supply, and this reliance exposes us to potential supply and service disruptions that could harm our business

  • 27% rewrittenRisks Related to Our Business and Our Industry

    If we are unable to attract and retain customers on a cost-effective basis, our revenue and operating results would be adversely affected

  • 25% rewrittenRisks Related to Our Business and Our Industry

    The failure to attract and retain additional qualified personnel could prevent us from executing our business strategy

  • 24% rewrittenRisks Related to Our Business and Our Industry

    Material defects or errors in our software or hardware failures could negatively impact our business, harm our reputation, result in significant costs to us, and negatively impact our ability to sell our cloud services

  • 23% rewrittenRisks Related to Our Business and Our Industry

    We have a history of cumulative losses, and we do not expect to be profitable for the foreseeable future

  • 21% rewrittenRisks Related to Our Business and Our Industry

    We are exposed to fluctuations in currency exchange rates, which could negatively affect our results of operations

  • 21% rewrittenRisks Related to Our Business and Our Industry

    We store personal information and other customer data, which subjects us to various data privacy laws, governmental regulations, and other related legal obligations, and any actual or perceived failure to comply with such requirements could harm our business

All 55 risk factors

Headings as the filing states them, in filing order.

Risks Related to Our Business and Our Industry

  1. 01We have a history of cumulative losses, and we do not expect to be profitable for the foreseeable future23% rewritten
  2. 02The markets in which we participate are intensely competitive, and if we do not compete effectively, our operating results would be harmed
  3. 03Any significant disruption in our service or loss, or delay in availability of our customers’ data, could damage our reputation and harm our business and operating results52% rewritten
  4. 04If we are unable to maintain our brand and reputation, our business, results of operations, and financial condition may be adversely affected
  5. 05If our information technology systems, including the data of our customers stored in our systems, are breached or subject to cybersecurity attacks, our reputation and business may be harmed
  6. 06If we are unable to attract and retain customers on a cost-effective basis, our revenue and operating results would be adversely affected27% rewritten
  7. 07If we are unable to provide successful enhancements, new features, and modifications to our cloud services, our business could be adversely affected29% rewritten
  8. 08Material defects or errors in our software or hardware failures could negatively impact our business, harm our reputation, result in significant costs to us, and negatively impact our ability to sell our cloud services24% rewritten
  9. 09If we fail to effectively manage our workforce and operational needs, our business would be harmedNew
  10. 10Our business could be materially harmed to the extent that we do not effectively manage our data center capacity and the costs associated with our data center spaces38% rewritten
  11. 11Our business depends on our ability to retain and increase revenue from customers, and if we are unable to do so, our revenue and operating results would be adversely affected
  12. 12To the extent we target different types of customers, we may face increased demands and challenges that adversely impact our business and operations41% rewritten
  13. 13The material stored using our cloud services may subject us to negative publicity, legal liability, and harm our business
  14. 14Our quarterly results may fluctuate significantly and may not fully reflect the underlying performance of our business33% rewritten
  15. 15We rely on the performance of key personnel, including our management and other key employees, and the loss of one or more of such personnel, or of a significant number of our team members, could harm our business51% rewritten
  16. 16The failure to attract and retain additional qualified personnel could prevent us from executing our business strategy25% rewritten
  17. 17Our corporate culture has contributed to our success, and if we cannot maintain this culture as we grow, we could lose the innovation, creativity, and teamwork fostered by our culture, and our business may be harmed
  18. 18Our operations and those of our customers, vendors and suppliers outside the United States, are subject to increased business, regulatory and economic risks that could impact our results of operations
  19. 19We use AI technologies internally to increase employee productivity and efficiency, but our business is also increasingly exposed to risks related to our customers, including neocloud partners and AI model builders, and their use of AI on our platform, any of which could harm our businessNew
  20. 20We store personal information and other customer data, which subjects us to various data privacy laws, governmental regulations, and other related legal obligations, and any actual or perceived failure to comply with such requirements could harm our business21% rewritten
  21. 21Our business is substantially dependent on mid-market organizations, which may be more vulnerable to market fluctuations and other economic factors, and their vulnerability to such factors could negatively impact our business
  22. 22We are dependent on a small number of service offerings, and any reduced market adoption of these offerings would result in lower revenue and harm our business
  23. 23Changes in global trade policies, including the imposition of tariffs and other trade restrictions, may adversely affect our businessNew
  24. 24Uncertainty in general economic conditions may adversely impact our revenue and profitability39% rewritten
  25. 25Our ability to maintain customer adoption and satisfaction depends in part on the ease of use of our cloud services, and any such failure could have an adverse effect on our business
  26. 26Future acquisitions and investments could disrupt our business and harm our financial condition and operating results
  27. 27Restrictive covenants under our credit facility may constrain our strategic and operational flexibilityNew
  28. 28We may require additional capital to support our operations or the growth of our business, and we cannot be certain that this capital will be available on reasonable terms when required, or at all41% rewritten
  29. 29We are exposed to fluctuations in currency exchange rates, which could negatively affect our results of operations21% rewritten
  30. 30Certain of our market opportunity estimates, growth forecasts, and other metrics included in this Annual Report on Form 10-K could prove to be inaccurate, and any real or perceived inaccuracies may harm our reputation and negatively affect our business
  31. 31Any future litigation against us could be costly and time-consuming to defend

Risks Related to Reliance on Infrastructure and Third Parties

  1. 32We rely on third-party vendors and suppliers, including data center and hard drive providers, which may have limited sources of supply, and this reliance exposes us to potential supply and service disruptions that could harm our business28% rewritten
  2. 33Our business depends, in part, on the success of our strategic relationships with third parties
  3. 34Our business is exposed to risks associated with online payment processing methods33% rewritten
  4. 35We rely on third-party systems for certain essential financial and operational services, and a failure or disruption in these services could materially and adversely affect our ability to manage our business effectively76% rewritten
  5. 36We are an emerging growth company, which provides, among other things, reduced disclosure requirements, and any decision on our part to comply only with reduced reporting and disclosure requirements applicable to such companies could make our common stock less attractive to investors66% rewritten

Risks Related to Accounting and Tax Matters

  1. 37The failure to maintain effective internal controls over financial reporting could harm our business and negatively impact the value of our common stock82% rewritten
  2. 38Because we recognize revenue from our subscription services over the term of the subscription, downturns or upturns in new business may not be immediately reflected in our operating results
  3. 39Our operating results may be harmed if we are required to collect sales or other related taxes for our cloud services in jurisdictions where we have not historically done so
  4. 40Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited37% rewritten
  5. 41Changes in tax laws and related matters could materially affect our financial condition, results of operations and cash flows63% rewritten
  6. 42If our estimates or judgments relating to our critical accounting estimates prove to be incorrect, our results of operations could be adversely affected37% rewritten

Risks Related to Intellectual Property

  1. 43Assertions by a third-party that our cloud services infringe, misappropriate, or otherwise violate their intellectual property could subject us to costly and time-consuming litigation and adversely impact our business
  2. 44If we are unable to adequately establish, maintain, protect, and enforce our intellectual property and proprietary rights, our reputation may be harmed, we may be subject to litigation, and our business may be adversely affected
  3. 45Our use of “open-source” software could negatively affect our ability to sell our cloud services and subject us to possible litigation

Risks Related to Ownership of Our Common Stock

  1. 46Anti-takeover provisions contained in our Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws, as well as provisions of Delaware law, could impair a takeover attempt
  2. 47These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in our management
  3. 48The market price of our common stock has been, and will likely continue to be, volatile, and you could lose all or part of your investment
  4. 49Our stock and business may be adversely affected by the actions of third parties attempting to manipulate our share priceNew
  5. 50We may fail to meet our publicly announced guidance or other expectations about our business, which could cause our stock price to decline
  6. 51Sales of a substantial number of our common stock in the public market could cause our share price to fall
  7. 52If securities or industry analysts do not publish or cease publishing research or reports about us, our business, our market, or our competitors, or if they adversely change their recommendations regarding our common stock, the market price of our common stock and trading volume could decline
  8. 53We do not expect to declare any dividends in the foreseeable future
  9. 54These exclusive forum provisions would not apply to suits brought to enforce a duty or liability created by the Exchange Act
  10. 55The requirements of being a public company, particularly after we are no longer an “emerging growth company,” may strain our resources, require us to incur substantial costs and will require substantial management attention47% rewritten

Other Backblaze 10-Ks

  • FY2024 10-K risk factors
    54 risks

    Backblaze carries significant accumulated deficits with ongoing net losses of $48.5 million in 2024 and $59.7 million in 2023. Operations depend heavily on third-party data centers, hard drive suppliers, and payment processors like Stripe. Growth requires successfully expanding into larger mid-market organizations against dominant cloud competitors like AWS and Google.

    Filed Mar 11, 2025

About this page

The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.