Why Backblaze Stock Skyrocketed Today

Backblaze (NASDAQ: BLZE) stock surged in Friday's trading. The company's share price rose 24.5%, according to data from S&P Global Market Intelligence . Shares had been up as much as 32.9% earlier in the daily session.

Backblaze published second-quarter results after the market closed yesterday and posted sales and earnings that beat Wall Street's expectations. In addition to the better-than-anticipated Q2 results and forward guidance, the company's stock also got a boost thanks to bullish coverage from an analyst.

Backblaze delivers encouraging growth and improving margins

Backblaze reported a non-GAAP (generally accepted accounting principles) adjusted loss per share of $0.11 on sales of $31.3 million in the second quarter. For reference, the average analyst estimate had called for the business to post an adjusted per-share loss of $0.13 on sales of roughly $31 million.

Backblaze's revenue was up roughly 27% year over year in the quarter, with B2 cloud storage revenue up 43% year over year to $15.4 million and sales for the computer-backup segment up 15% to $15.9 million. Meanwhile, the company's net loss narrowed to $10.3 million -- down from $14.3 million in the prior-year period.

What's next for Backblaze?

In addition to the better-than expected Q2 results, Backblaze also issued raised its full-year performance targets. The company now expects sales for the year to come in between $126.5 million and $128.5 million -- up from its previous target for sales to be between $126 million and $128 million. Prior to the report, the average analyst estimate had called for the business to deliver sales of roughly $126.8 million.

The company also raised its targeted adjusted earnings before interest, taxes, depreciation, and amortization ( EBITDA ) margin to between 9% and 11%. Previously, Backblaze had guided for its full-year adjusted EBITDA margin to be between 8% and 10%.

Following the beat-and-raise quarter, Craig-Hallum published a research note on Backblaze and reiterated a buy rating on the stock. The firm also raised its one-year price target on the stock from $9 per share to $10 per share. Based on Friday's closing price, Craig-Hallum's new price target suggests potential upside of roughly 55%.

Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .