BlackLine Announces Second Quarter Financial Results

LOS ANGELES, Aug. 05, 2025 (GLOBE NEWSWIRE) -- BlackLine, Inc. (Nasdaq: BL), today announced financial results for the second quarter ended June 30, 2025. “Our strong second quarter results demonstrate BlackLine's growing success, which is a direct outcome of our disciplined go-to-market execution and significant progress on the strategic initiatives we outlined last fall,” said Owen Ryan, Co-CEO of BlackLine. “Specifically, the delivery of our Studio360 platform, adoption of our new pricing strategy, sharpened industry focus, and enhanced partner network all played a key role in driving this quarter’s performance.” “Innovation truly drives BlackLine, and our Studio360 platform is leading the charge in bringing new levels of clarity and control within the Office of the CFO,” said Therese Tucker, Co-CEO of BlackLine. “With significant advancements across our solutions, powered by our thoughtful approach to AI, we are empowering customers with the integrated, intelligent solutions they need to transform their operations.” Second Quarter 2025 Financial Highlights Total GAAP revenues of $172.0 million, an increase of 7% compared to the second quarter of 2024.GAAP operating margin of 4.4%, compared to 1.4% in the second quarter of 2024.Non-GAAP operating margin of 22.1%, compared to 19.8% in the second quarter of 2024.GAAP net income attributable to BlackLine of $8.3 million, or $0.13 per diluted share compared to GAAP net income attributable to BlackLine of $76.7 million, or $0.221 per diluted share in the second quarter of 2024.Non-GAAP net income attributable to BlackLine of $37.9 million, or $0.51 per diluted share compared to non-GAAP net income attributable to BlackLine of $42.9 million, or $0.58 per diluted share in the second quarter of 2024.Billings of $182.3 million, an increase of 11% compared to the second quarter of 2024.Remaining performance obligation of $944.3 million, an increase of 11% compared to the second quarter of 2024.Operating cash flow of $32.3 million, compared to $40.7 million in the second quarter of 2024.Free cash flow of $25.4 million, compared to $34.4 million in the second quarter of 2024.Repurchased approximately 0.8 million shares of common stock for $43.3 million as part of its share repurchase program under which approximately $111.2 million of buyback capacity remained at June 30, 2025. ________________________1 Excludes the after-tax impact of the gain on extinguishment of debt associated with the partial repurchase of the 2026 convertible senior notes. Second Quarter Key Metrics and Recent Business Highlights BlackLine had a total of 4,451 customers at June 30, 2025.BlackLine had a total of 389,559 users at June 30, 2025, reflecting customer migrations to the Company’s recently implemented platform pricing model.Achieved a dollar-based net revenue retention rate of 105% at June 30, 2025.Expanded into the U.S. public sector with the signing of the Company’s first federal agency.Appointed Sam Balaji and Greg Hughes to the BlackLine Board of Directors.Announced the integration of Agentic AI capabilities to accelerate future-ready financial operations. The financial results included in this press release are preliminary and subject to final review. Financial results will not be final until BlackLine files its Quarterly Report on Form 10-Q for the period. Information about BlackLine’s use of non-GAAP financial measures is provided below under “Use of Non-GAAP Financial Measures.” Financial Outlook Third Quarter 2025 Total GAAP revenue is expected to be in the range of $177 million to $179 million.Non-GAAP operating margin is expected to be in the range of 20% to 21%.Non-GAAP net income attributable to BlackLine is expected to be in the range of $36 million to $38 million, or $0.48 to $0.51 per share on 77.3 million diluted weighted average shares outstanding. Full Year 2025 Total GAAP revenue is expected to be in the range of $696 million to $705 million.Non-GAAP operating margin is expected to be in the range of 21.5% to 22.5%.Non-GAAP net income attributable to BlackLine is expected to be in the range of $159 million to $167 million, or $2.13 to $2.24 per share on 77.3 million diluted weighted average shares outstanding. Guidance for non-GAAP operating margin, non-GAAP net income attributable to BlackLine, and non-GAAP net income per share attributable to BlackLine excludes specified items from the corresponding GAAP financial measures as outlined below under “Use of Non-GAAP Financial Measures” and as detailed in the reconciliations of non-GAAP measures for historical periods. Reconciliations of non-GAAP operating margin, non-GAAP net income attributable to BlackLine, and non-GAAP net income per share attributable to BlackLine guidance to the most directly comparable U.S. GAAP measures are not available on a forward-looking basis without unreasonable efforts due to the unpredictability and complexity of the charges excluded from these non-GAAP financial measures. The Company expects the variability of the above items could have a significant, and potentially unpredictable, impact on its future GAAP operating margin, net income attributable to BlackLine, and net income per share attributable to BlackLine. Quarterly Conference Call BlackLine will hold a conference call to discuss its second quarter results at 2:00 p.m. Pacific time on Tuesday, August 5, 2025. A live audio webcast will be accessible on BlackLine’s investor relations website at https://investors.blackline.com. Participants can preregister for the conference call. A replay of the webcast will be available at https://investors.blackline.com for 12 months. BlackLine has used, and intends to continue to use, its Investor Relations website as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD. About BlackLine BlackLine (Nasdaq: BL), the future-ready platform for the Office of the CFO, drives digital finance transformation by empowering organizations with accurate, efficient, and intelligent financial operations. BlackLine’s comprehensive platform addresses mission-critical processes, including record-to-report and invoice-to-cash, enabling unified and accurate data, streamlined and optimized processes, and real-time insight through visibility, automation, and AI. BlackLine’s proven, collaborative approach ensures continuous transformation, delivering immediate impact and sustained value. With a proven track record of innovation, industry-leading R&D investment, and world-class security practices, more than 4,400 customers across multiple industries partner with BlackLine to lead their organizations into the future. For more information, please visit blackline.com. Forward-looking Statements This release and the conference call referenced above contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “could,” “expect,” “plan,” anticipate,” “believe,” “estimate,” “predict,” “intend,” “potential,” “would,” “continue,” “ongoing,” or the negative of these terms or other comparable terminology. Forward-looking statements in this release and quarterly conference call include, but are not limited to, statements regarding BlackLine’s future financial and operational performance, including, without limitation, GAAP and non-GAAP guidance for the third quarter and full year of 2025, the impact of progress against certain key initiatives, our expectations for our business, including the demand environment, BlackLine’s addressable market, market position and pipeline, our international growth, and our relationships with our customers and partners, including opportunities to expand those relationships. Any forward-looking statements contained in this press release or the quarterly conference call are based upon BlackLine’s historical performance and its current plans, estimates and expectations, and are not a representation that such plans, estimates, or expectations will be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management’s good-faith beliefs and assumptions as of that time with respect to future events, and are subject to risks and uncertainties. If any of these risks or uncertainties materialize or if any assumptions prove incorrect, actual performance or results may differ materially from those expressed in or suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to, risks related to the Company’s ability to attract new customers and expand sales to existing customers; the extent to which customers renew their subscription agreements or increase the number of users; the impact of current and future economic uncertainty and other unfavorable conditions in the Company's industry or the global economy; the Company’s ability to manage growth and scale effectively, including entry into new geographies; the Company’s ability to provide successful enhancements, new features and modifications to its software solutions; the Company’s ability to develop new products and software solutions and the success of any new product and service introductions; the Company's ability to effectively incorporate artificial intelligence and machine learning technologies (AI/ML) into its platform and business and the potential reputational harm or legal liability that may result from the use of AI/ML solutions and features; the success of the Company’s strategic relationships with technology vendors and business process outsourcers, channel partners and alliance partners; any breaches of the Company’s security measures; a disruption in the Company’s hosting network infrastructure; costs and reputational harm that could result from defects in the Company’s solutions; the loss of any key employees; continued strong demand for the Company’s software in the United States, Europe, Asia Pacific, and Latin America; the Company’s ability to compete as the financial close management provider for organizations of all sizes; the timing and success of solutions offered by competitors; including competitors' ability to incorporate AI/ML into products and offerings more quickly or successfully; changes in the proportion of the Company’s customer base that is comprised of enterprise or mid-sized organizations; the Company’s ability to expand and effectively manage its sales teams and their performance and productivity; fluctuations in our financial results due to long and increasingly variable sales cycles; failure to protect the Company’s intellectual property; the Company’s ability to integrate acquired businesses and technologies successfully or achieve the expected benefits of such transactions; unpredictable and uncertain macro and regional economic conditions; seasonality; changes in current tax or accounting rules; cyber attacks and the risk that the Company’s security measures may not be sufficient to secure its customer or confidential data adequately; acts of terrorism or other vandalism, war, or natural disasters including the effects of climate change; the impact of any determination of deficiencies or weaknesses in our internal controls and processes; and other risks and uncertainties described in the other filings we make with the Securities and Exchange Commission from time to time, including the risks described under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission on February 21, 2025. Additional information will also be set forth in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025. Forward-looking statements should not be read as a guarantee of future performance or results, and you should not place undue reliance on such statements. Except as required by law, we do not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. All of the information in this press release is subject to completion of our quarterly review process. Use of Non-GAAP Financial Measures To supplement its consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles, or GAAP, BlackLine has provided in this release and the quarterly conference call held on August 5, 2025, certain financial measures that have not been prepared in accordance with GAAP defined as “non-GAAP financial measures,” which include (i) non-GAAP gross profit and non-GAAP gross margin, (ii) non-GAAP operating expenses, (iii) non-GAAP operating income and non-GAAP operating margin, (iv) non-GAAP net income attributable to BlackLine, Inc., (v) diluted non-GAAP net income per share attributable to BlackLine, Inc., and (vi) free cash flow. BlackLine’s management uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, as a supplement to the corresponding GAAP measures, in evaluating BlackLine’s ongoing operational performance and trends and in comparing its financial measures with other companies in the same industry, many of which present similar non-GAAP financial measures to help investors understand the operational performance of their businesses. However, it is important to note that the particular items BlackLine excludes from, or includes in, its non-GAAP financial measures may differ from the items excluded from, or included in, similar non-GAAP financial measures used by other companies in the same industry. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures. A reconciliation of the non-GAAP financial measures to such GAAP measures has been provided in the tables included as part of this press release. Non-GAAP Gross Profit and Non-GAAP Gross Margin. Non-GAAP gross profit is defined as GAAP revenues less GAAP cost of revenue adjusted for amortization of acquired developed technology, stock-based compensation, and transaction-related costs (including, but not limited to, accounting, legal, and advisory fees related to the transaction, as well as transaction-related retention bonuses). Non-GAAP gross margin is defined as non-GAAP gross profit divided by GAAP revenues. BlackLine believes that presenting non-GAAP gross profit and non-GAAP gross margin is useful to investors as it eliminates the impact of certain non-cash expenses and allows a direct comparison between periods. Non-GAAP Operating Expenses. Non-GAAP operating expenses include (a) non-GAAP sales and marketing expense, (b) non-GAAP research and development expense, and (c) non-GAAP general and administrative expense. Non-GAAP sales and marketing expense is defined as GAAP sales and marketing expense adjusted for amortization of intangible assets, stock-based compensation, and transaction-related costs. Non-GAAP research and development expense is defined as GAAP research and development expense adjusted for stock-based compensation and transaction-related costs. Non-GAAP general and administrative expense is defined as GAAP general and administrative expense adjusted for amortization of intangible assets, stock-based compensation, change in fair value of contingent consideration, transaction-related costs, and legal settlement gains or costs. BlackLine believes that presenting each of the non-GAAP operating expenses is useful to investors as it eliminates the impact of certain cash and non-cash expenses and allows a direct comparison of operating expenses between periods. Non-GAAP Income from Operations and Non-GAAP Operating Margin. Non-GAAP income from operations is defined as GAAP income from operations adjusted for amortization of intangible assets, stock-based compensation, change in fair value of contingent consideration, transaction-related costs, legal settlement gains or costs, and restructuring costs. Non-GAAP operating margin is defined as non-GAAP income from operations divided by GAAP revenues. BlackLine believes that presenting non-GAAP income from operations and non-GAAP operating margin is useful to investors as it eliminates the impact of items that have been impacted by the Company’s acquisitions and other related costs in order to allow a direct comparison of income from operations between all periods presented. Non-GAAP Net Income Attributable to BlackLine and Diluted Non-GAAP Net Income Per Share Attributable to BlackLine, Inc. Non-GAAP net income attributable to BlackLine is defined as GAAP net income attributable to BlackLine adjusted for the income tax effects of acquisitions, stock-based compensation shortfalls and windfalls, and the discrete tax impact of other non-GAAP adjustments, amortization of intangible assets, stock-based compensation, amortization of debt issuance costs from our convertible senior notes, change in fair value of contingent consideration, transaction-related costs, legal settlement gains or costs, restructuring costs, adjustment to the redeemable non-controlling interest to the redemption amount, and gain on extinguishment of convertible senior notes. Diluted non-GAAP net income per share attributable to BlackLine, Inc. includes the adjustment for shares resulting from the elimination of stock-based compensation. BlackLine believes that presenting non-GAAP net income attributable to BlackLine is useful to investors as it eliminates the impact of items that have been impacted by the Company’s acquisitions and other related costs to allow a direct comparison of net income between all periods presented. Free Cash Flow. Free cash flow is defined as cash flows provided by (used in) operating activities less cash flows used to purchase property and equipment, financed and otherwise, capitalized software development, and intangible assets. BlackLine believes that presenting free cash flow is useful to investors as it provides a measure of the Company’s liquidity used by management to evaluate the amount of cash generated by the Company’s business including the impact of purchases of property and equipment and cost of capitalized software development. Use of Operating Metrics BlackLine has provided in this release and the quarterly conference call held on August 5, 2025 certain operating metrics, including (i) number of customers, (ii) number of users, and (iii) dollar-based net revenue retention rate, which BlackLine uses to evaluate its business, measure its performance, identify trends affecting its business, formulate financial projections and make strategic decisions. These operating metrics exclude the impact of certain Runbook licensed customers and users who are on perpetual license agreements and did not have an active subscription agreement with BlackLine as of June 30, 2025. Dollar-based Net Revenue Retention Rate. Dollar-based net revenue retention rate is calculated as the implied monthly subscription and support revenue at the end of a period for the base set of customers from which the Company generated subscription revenue in the year prior to the calculation, divided by the implied monthly subscription and support revenue one year prior to the date of calculation for that same customer base. This calculation does not reflect implied monthly subscription and support revenue for new customers added during the one-year period but does include the effect of customers who terminated during the period. Implied monthly subscription and support revenue is defined as the total amount of minimum subscription and support revenue contractually committed to, under each of BlackLine’s customer agreements over the entire term of the agreement, divided by the number of months in the term of the agreement. BlackLine believes that dollar-based net revenue retention rate is an important metric to measure the long-term value of customer agreements and the Company’s ability to retain and grow its relationships with existing customers over time. Number of Customers. A customer is defined as a company that contributes to our subscription and support revenue as of the measurement date. In situations where an organization has multiple subsidiaries or divisions, each entity that is invoiced as a separate entity is treated as a separate customer. In an instance where an existing customer requests its invoice be divided for the sole purpose of restructuring its internal billing arrangement without any incremental increase in revenue, such customer continues to be treated as a single customer. BlackLine believes that its ability to expand its customer base is an indicator of the Company’s market penetration and the growth of its business. Number of Users. Historically, BlackLine’s products were priced based on the number of users of its platform. Over time, the Company has begun to sell an increasing number of non-user based products with fixed or transaction-based pricing. For this reason, we believe the growth in the number of total users is less correlated to the growth of the business overall. Media Contact:Samantha Darileksamantha.darilek@blackline.com Investor Relations Contact:Matt Humphries, CFAmatt.humphries@blackline.com BlackLine, Inc.Condensed Consolidated Balance Sheets(in thousands)(unaudited) June 30, 2025 December 31, 2024ASSETSCurrent assets: Cash and cash equivalents$459,141 $885,915 Marketable securities 398,277 — Accounts receivable, net of allowances 175,021 178,141 Prepaid expenses and other current assets 23,748 28,348 Total current assets 1,056,187 1,092,404 Capitalized software development costs, net 47,554 45,448 Property and equipment, net 13,843 11,840 Intangible assets, net 52,402 59,520 Goodwill 448,965 448,965 Operating lease right-of-use assets 25,689 22,772 Deferred tax assets, net 55,714 53,208 Other assets 92,335 90,879 Total assets$1,792,689 $1,825,036 LIABILITIES, REDEEMABLE NON-CONTROLLING INTEREST, AND STOCKHOLDERS' EQUITYCurrent liabilities: Accounts payable$11,520 $8,463 Accrued expenses and other current liabilities 57,448 71,574 Deferred revenue, current 341,549 338,615 Finance lease liabilities, current 12 66 Operating lease liabilities, current 3,709 3,525 Convertible senior notes, net, current 229,592 — Total current liabilities 643,830 422,243 Finance lease liabilities, noncurrent 46 53 Operating lease liabilities, noncurrent 23,294 20,283 Convertible senior notes, net, noncurrent 664,762 892,675 Deferred tax liabilities, net 4,804 4,532 Deferred revenue, noncurrent 796 1,390 Other long-term liabilities 6,110 708 Total liabilities 1,343,642 1,341,884 Commitments and contingencies Redeemable non-controlling interest 35,000 36,483 Stockholders' equity: Common stock 619 628 Additional paid-in capital 450,975 495,391 Accumulated other comprehensive loss (166) (361)Accumulated deficit (37,381) (48,989)Total stockholders' equity 414,047 446,669 Total liabilities, redeemable non-controlling interest, and stockholders' equity$1,792,689 $1,825,036 BlackLine, Inc. Condensed Consolidated Statements of Operations(in thousands, except per share data)(unaudited) Quarter Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 Revenues Subscription and support$163,027 $151,787 $321,489 $301,288 Professional services 8,998 8,719 17,467 16,679 Total revenues 172,025 160,506 338,956 317,967 Cost of revenues Subscription and support 35,189 33,756 69,319 65,808 Professional services 7,433 6,592 14,227 13,637 Total cost of revenues 42,622 40,348 83,546 79,445 Gross profit 129,403 120,158 255,410 238,522 Operating expenses Sales and marketing 64,712 60,248 127,775 121,359 Research and development 27,964 25,721 53,689 50,736 General and administrative 28,138 31,053 56,483 61,099 Restructuring costs 1,044 928 6,343 1,372 Total operating expenses 121,858 117,950 244,290 234,566 Income from operations 7,545 2,208 11,120 3,956 Other income (expense) Interest income 8,555 14,065 17,447 29,425 Interest expense (2,533) (2,089) (5,055) (3,558)Gain on extinguishment of convertible senior notes — 65,112 — 65,112 Other income, net 6,022 77,088 12,392 90,979 Income before income taxes 13,567 79,296 23,512 94,935 Provision for income taxes 6,176 4,337 10,847 5,206 Net income 7,391 74,959 12,665 89,729 Net income attributable to redeemable non-controlling interest 660 524 1,057 962 Adjustment attributable to redeemable non-controlling interest (1,561) (2,255) (2,739) 1,248 Net income attributable to BlackLine, Inc.$8,292 $76,690 $14,347 $87,519 Basic net income per share attributable to BlackLine, Inc.$0.13 $1.24 $0.23 $1.42 Shares used to calculate basic net income per share 62,143 61,979 62,481 61,811 Diluted net income per share attributable to BlackLine, Inc.$0.13 $0.22 $0.23 $0.39 Shares used to calculate diluted net income per share 64,004 72,522 64,420 72,708 BlackLine, Inc.Calculation of Diluted Net Income Per Share(in thousands, except per share data)(unaudited) Quarter Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 Diluted Net Income Per Share Numerator: Net income attributable to BlackLine, Inc.$8,292 $76,690 $14,347 $87,519 Interest expense, net of taxes 130 1,707 255 3,101 Gain on extinguishment of convertible senior notes, net of taxes — (62,147) — (62,147)Net income attributable to BlackLine, Inc. for diluted calculation$8,422 $16,250 $14,602 $28,473 Denominator: Weighted average shares 62,143 61,979 62,481 61,811 Dilutive effect of securities 476 635 554 781 Dilutive effect of convertible senior notes 1,385 9,908 1,385 10,116 Shares used to calculate diluted net income per share 64,004 72,522 64,420 72,708 Diluted net income per share attributable to BlackLine, Inc.$0.13 $0.22 $0.23 $0.39 BlackLine, Inc.Condensed Consolidated Statements of Cash Flows(in thousands)(unaudited) Quarter Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 Cash flows from operating activities Net income attributable to BlackLine, Inc.$8,292 $76,690 $14,347 $87,519 Net income and adjustment attributable to redeemable non-controlling interest (901) (1,731) (1,682) 2,210 Net income 7,391 74,959 12,665 89,729 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 11,475 12,652 22,973 25,300 Amortization of debt issuance costs 845 1,294 1,679 2,679 Stock-based compensation 24,657 22,726 43,231 41,288 Gain on extinguishment of convertible senior notes — (65,112) — (65,112)Noncash lease expense 1,297 1,552 2,694 3,110 Accretion of purchase discounts on marketable securities, net (3,393) (6,719) (5,361) (15,261)Net foreign currency (gains) losses 788 (195) 561 (157)Deferred income taxes (921) (214) (2,234) (1,255)Provision for credit losses 19 7 75 7 Changes in operating assets and liabilities: Accounts receivable (27,269) (11,701) 5,468 33,995 Prepaid expenses and other current assets 6,666 5,488 4,788 3,524 Other assets (911) (797) (1,428) 1,609 Accounts payable 6,119 249 2,529 (6,543)Accrued expenses and other current liabilities (6,358) 3,878 (12,989) (10,896)Deferred revenue 10,272 4,028 2,248 (7,802)Operating lease liabilities (1,729) (1,531) (3,239) (3,241)Lease incentive receipts — — 30 — Other long-term liabilities 3,397 134 5,397 149 Net cash provided by operating activities 32,345 40,698 79,087 91,123 Cash flows from investing activities Purchases of marketable securities (92,017) (101,143) (476,940) (396,104)Proceeds from maturities of marketable securities 84,000 268,800 84,000 591,500 Proceeds from sales of marketable securities — 324,098 — 324,098 Capitalized software development costs (5,994) (5,637) (14,161) (12,087)Purchases of property and equipment (966) (677) (6,917) (976)Net cash provided by (used in) investing activities (14,977) 485,441 (414,018) 506,431 Cash flows from financing activities Proceeds from issuance of convertible senior notes, net of issuance costs — 662,641 — 662,641 Partial repurchase of convertible senior notes — (848,519) — (848,519)Purchase of capped calls related to convertible senior notes — (59,738) — (59,738)Principal payments under finance lease obligations (3) (258) (60) (516)Repurchases of common stock (43,332) — (88,783) — Proceeds from exercises of stock options 2,882 2,324 5,018 2,638 Proceeds from employee stock purchase plan 4,592 4,249 4,592 4,249 Acquisition of common stock for tax withholding obligations (2,052) (1,403) (12,991) (12,384)Net cash used in financing activities (37,913) (240,704) (92,224) (251,629)Effect of foreign currency exchange rate changes on cash, cash equivalents, and restricted cash 170 (209) 410 (421)Net increase (decrease) in cash, cash equivalents, and restricted cash (20,375) 285,226 (426,745) 345,504 Cash, cash equivalents, and restricted cash, beginning of period 479,777 331,641 886,147 271,363 Cash, cash equivalents, and restricted cash, end of period$459,402 $616,867 $459,402 $616,867 Reconciliation of cash, cash equivalents, and restricted cash to the condensed consolidated balance sheets Cash and cash equivalents at end of period$459,141 $616,629 $459,141 $616,629 Restricted cash included within other assets at end of period 261 238 261 238 Total cash, cash equivalents, and restricted cash at end of period shown in the condensed consolidated statements of cash flows$459,402 $616,867 $459,402 $616,867 BlackLine, Inc.Reconciliations of Non-GAAP Financial Measures(in thousands, except percentages and per share data)(unaudited) Quarter Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 Non-GAAP Gross Profit: Gross profit$129,403 $120,158 $255,410 $238,522 Amortization of acquired developed technology 3,207 3,383 6,380 6,767 Stock-based compensation 4,535 3,653 8,181 6,249 Transaction-related costs — 38 8 90 Total non-GAAP gross profit$137,145 $127,232 $269,979 $251,628 Gross margin 75.2% 74.9% 75.4% 75.0%Non-GAAP gross margin 79.7% 79.3% 79.7% 79.1% Non-GAAP Operating Income: Operating income$7,545 $2,208 $11,120 $3,956 Amortization of intangible assets 3,468 5,195 7,118 10,391 Stock-based compensation 25,571 23,406 44,990 42,602 Transaction-related costs (credits) 128 (6) 3,138 210 Restructuring and legal settlement costs 1,295 928 6,594 1,372 Total non-GAAP operating income$38,007 $31,731 $72,960 $58,531 GAAP operating margin 4.4% 1.4% 3.3% 1.2%Non-GAAP operating margin 22.1% 19.8% 21.5% 18.4% Non-GAAP Net Income Attributable to BlackLine, Inc.: Net income attributable to BlackLine, Inc.$8,292 $76,690 $14,347 $87,519 Provision for (benefit from) income taxes (12) 2,902 (666) 2,319 Amortization of intangible assets 3,468 5,195 7,118 10,391 Stock-based compensation 25,447 23,292 44,755 42,377 Amortization of debt issuance costs 845 1,294 1,679 2,679 Transaction-related costs (credits) 128 (6) 3,138 210 Restructuring and legal settlement costs 1,295 928 6,594 1,372 Adjustment to redeemable non-controlling interest (1,561) (2,255) (2,739) 1,248 Gain on extinguishment of convertible senior notes — (65,112) — (65,112)Total non-GAAP net income attributable to BlackLine, Inc.$37,902 $42,928 $74,226 $83,003 Basic Non-GAAP Net Income Per Share Attributable to BlackLine, Inc.: Basic non-GAAP net income per share attributable to BlackLine, Inc.$0.61 $0.69 $1.19 $1.34 Shares used to calculate basic non-GAAP net income per share 62,143 61,979 62,481 61,811 Diluted Non-GAAP Net Income Per Share Attributable to BlackLine, Inc. Numerator: Non-GAAP net income attributable to BlackLine, Inc.$37,902 $42,928 $74,226 $83,003 Interest expense, net of taxes 1,451 699 2,923 773 Non-GAAP net income attributable to BlackLine, Inc. for diluted calculation$39,353 $43,627 $77,149 $83,776 Denominator: Weighted average shares 62,143 61,979 62,481 61,811 Dilutive effect of securities 4,351 3,524 3,672 3,218 Dilutive effect of convertible senior notes 11,243 9,908 11,243 10,116 Shares used to calculate diluted non-GAAP net income per share 77,737 75,411 77,396 75,145 Diluted non-GAAP net income per share attributable to BlackLine, Inc.$0.51 $0.58 $1.00 $1.11 Non-GAAP Sales and Marketing Expense: Sales and marketing expense$64,712 $60,248 $127,775 $121,359 Amortization of intangible assets (183) (1,734) (581) (3,467)Stock-based compensation (6,900) (6,629) (12,944) (12,423)Transaction-related costs — (54) (10) (21)Total non-GAAP sales and marketing expense$57,629 $51,831 $114,240 $105,448 Non-GAAP Research and Development Expense: Research and development expense$27,964 $25,721 $53,689 $50,736 Stock-based compensation (4,451) (3,499) (7,801) (6,350)Transaction-related credits (costs) — 106 (21) (65)Total non-GAAP research and development expense$23,513 $22,328 $45,867 $44,321 Non-GAAP General and Administrative Expense: General and administrative expense$28,138 $31,053 $56,483 $61,099 Amortization of intangible assets (78) (78) (157) (157)Stock-based compensation (9,685) (9,625) (16,064) (17,580)Transaction-related costs (128) (8) (3,099) (34)Restructuring and legal settlement costs (251) — (251) — Total non-GAAP general and administrative expense$17,996 $21,342 $36,912 $43,328 Total Non-GAAP Operating Expenses$99,138 $95,501 $197,019 $193,097 Free Cash Flow Net cash provided by operating activities$32,345 $40,698 $79,087 $91,123 Capitalized software development costs (5,994) (5,637) (14,161) (12,087)Purchases of property and equipment (966) (677) (6,917) (976)Free cash flow$25,385 $34,384 $58,009 $78,060

BlackLine Announces Second Quarter Financial Results

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