BL - Earnings call transcript Q4 2024

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Operator

Good day, and thank you for standing by. Welcome to the BlackLine Q4 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to turn the call over to Matt Humphries. Please begin, sir.

Matt Humphries

you us thank and afternoon, for today. joining Good Patrick are and BlackLine; Therese me Officer; well on Co-Chief Ryan call the and Financial Chief of With Tucker, Officer. Owen Executive Mark Partin, Chief Villanova, Accounting as as Officers

XXXX I'd are particular, and Before that objectives that the certain conference historical and forward-looking future our plans, facts QX including are expected to statements we like year Reform the note in during guidance within made for meaning full Securities get Private this our Act performance, started, not XXXX. call statements of those regarding of Litigation

These forward-looking date the statements of represent outlook as this only of call. our

as any While and XX-Q. on call Exchange made based our Commission, in reasonable, of these our and the forward-looking current the our filed expectations materially XX-K those and and including during periodic risks statements statements Form to we reports are subject with Form as are actual believe in are stated today uncertainties, differ results particularly could Securities

update not to disclaim corresponding otherwise, new relate period future as comparisons unless noted. All or undertake year, expressly applicable otherwise our the we as by alter result law. any required and call information, events statements, obligation on make of the except do a to forward-looking We whether or today of last

investors.blackline.com be discussion our financial of stated, found may results Relations otherwise historical information Form the our our available non-GAAP disclosed filed earnings non-GAAP. our measures financial in at these today. reconciliations with Investor our non-GAAP release, SEC is X-K on will measures A versus unless website GAAP Finally, of call on or regarding this be which in and

to BlackLine's Now I'll Owen Ryan. Executive Co-Chief Owen. the call Officer, turn over

Owen Ryan

Thank the across joining have everyone. wildfires for Thank on impacts Like call. we devastating afternoon, had Los you us Angeles. seen you, today's and the good you, Matt, have

the in those call peers, our their L.A. our who industry families with home. affected are and partners employees, thoughts and region community, Our all all stakeholders including this

of our have remain several customers fires are team members and delivering impacted for our operations been our the by While without disruption. unaffected, and we evacuations,

direct providing with to assist employees community. to relief broader the working and local organizations are are We affected support our

performance BlackLine to provide our impact guidance our due fourth or fourth of exceeded operating turning dollar. Now margin a specific XX%. FX quarter We despite our the performance. of delivered growth and revenue strong met currency the a non-GAAP X% revenue quarter Patrick U.S. and detailed to headwinds movements in will shortly. a with of non-GAAP notable breakdown

enter we evolution and As the successful BeyondTheBlack event. year, on our momentum our following strategic right remains track

seen Our across multiple healthy growth pipeline dimensions. has

size, We opportunity multi-pillar increase volume in platform both are seeing driven and an in in part or opportunities. through critically

into strategic improved, also partnerships. extend our opportunity late-stage to reflects of opportunities of market deal platform's has The That by the part This quality we in see larger the these and value our where in did quarter fourth enhanced slowed. volume, higher combination The recognition channel some XXXX. quality caused comprehensive in driven of said, larger growing velocity, opportunities, being instances proposition. especially opportunities deals

of to expect coming we the January, months. Some closed deals in and have these close in most

building optimistic will that momentum has remain that the been We continue.

business. Our pleased largest drive and His I with and to will key am Houten, partner, new execution with SAP, strategic At accelerate to only we priorities. ultimately, Day, Officer, progress strategy our is Chief relentless Commercial Investor and across enhance these substantial report initiatives, our expected customers results. shared Van and and Stuart our today go-to-market enterprise started experience the across

fulfill environment critical positioning caution the One Washington, continues organizations Government at their technology changing increasingly sector a and crucial recognize missions of certification FedRAMP journey the to effectively, Our seeing space. to is agencies this promising to opportunities in in time. emerge for public towards us word D.C. plan, according serve we're modern need

to adopt just BlackLine partner finance technology with to We are deeply who our state momentum digital local gaining with through governments their but are transformation. not and eager

is While our have the I public am and we sector large very initiative opportunity seen early, ahead. momentum early with pleased the greenfield

Our Interest before even new and during pricing model, has traction. launch. building BeyondTheBlack seen early packaging formal conference recently positive launched, the began the

expand the an other areas pricing accounting secured transformation. digital agreement teams their unlimited typical and as enabling the our we they an to move in Office QX, beyond customer, with existing on the forward In finance CFO them into solutions of

our a our we will to growth. month are over that expect and we While initial in, this X be accretive to little targets initiative are tracking multiyear

saw On been retention, in revenue our was XX% has improvement In quarter, renewal revenue rate, in further at priority BlackLine. renewals quarter. the we renewal heavy was what our which our rate a fourth

at notable in brand in improvement are the financial These that platform CFO. At powers Our which intelligent more market Office message, expectations. mid-market enterprise formally repositioned we line strong our a our at came our data launched with much solidifying the business, our XX%, as performance with XX%. BeyondTheBlack, the in and levels modern of was coupled position

our platform Though modernized packaging. pricing anticipate its StudioXXX driver. early industry a our will and our beyond stages, go-to-market also platform positioning messaging. elevate extends ago, that with goal. our StudioXXX growth we has embedded engagement set strategic transformation key a deeper expanded be who focus, integrators years and of evolution us catalyzed Two represents to we reach in launch capabilities, intelligence This enables out in critical It potential system just artificial and see the strategy. still brand comprehensive our The to SAP, encompassing enhanced This to CFO.

our and proposition CIOs, By we pursue delivering strategic ROI, more positioning enhanced larger, opportunities. CFOs demonstrable customer value and have strengthened us both to to value

of platform BlackLine CFO. investments and deeper their As mentioned, see driven systems and engagement with with Office continue in our practices our to evolution has integrators partners, the for global major the aligning increasing we vision

also our increasing focused to go-to-market partner partners, reach while on existing select new enhancing We relationships. are

message For CIOs we competitive program success Workday's and our with positioning their reach example, elevate strategy. CFOs strategic well entered globally. believe global leaders, to and discussions to our industries In continue senior their in and strength my aligns and with we and recently partner markets to

We focused go-to-market have also our on our primary enhancing partner. deepening with relationship SAP, and strategic

our Since going value strategy provide to numerous results SAP's Given growth move how we partnership more forward. can have The to future customers to enhance the companies. meetings we as this significance was to they and allow had to driving November, our me stronger discuss for financial even this transformation context on digital the focus trends, and partnership. cloud additional about accelerating

forward. Let few outline just have a me the committed to items we of going

qualification the will process Coupling and our powerful StudioXXX part resonate begun together StudioXXX a for have customers the in program, automation offer for solutions we in of SAP comprehensive with with as SolEx formal orchestration launch platform capabilities First, the second quarter. market. premium to the globally scheduled SAP's

to we in to initiative, which SAP ECC package as of planning have package been from migrate recommended Second, EPM is SAP part included customers a S/XHANA. for their RISE

SAP package, this customers. will solutions and part As to included BlackLine analytics offered and be of financial reporting StudioXXX

focus of Next, BlackLiners sole we team which Catalysts all launched making a our SAP aspects be dedicated on will relationship whose group, of is work. the

those structure support to moving compensation our our aligning for tightly efforts, cloud. especially more to SolEx the public are We

be sequencing as an finance in positioning growth this of implementations deployments jointly and a work in early SAP efforts, years. modernization. partnership our expect are before not XXXX. customers' but promise, we update in we point intended entry exhaustive particularly allows ERP of Early digital This delivering our the Finally, strategic transformation the for is next show strong, to ERP alignment first for as migrations, BlackLine several we significant over ROI journeys. This quite a year transition to through was drive

Europe, platform In to aerospace large activity smaller broader Systems, transformation Historically, subsidiaries defense the with given upcoming we around enable BAE to a vision, deal of S/XHANA with globe. our demonstrate in and global digital Turning we, But advance their able serve we performance expanded were along this and we company. finance transformation. journey partners, how scattered could quarter. their our

Snowflake, North financial and in to was have This as could close customer. they competitor a were desire our In their a support partner that new grow by we scale, replace at analytics driven America, competitors deal, both able including mid-market reporting them financial multi-pillar to something match. a could not

capabilities significant deal and As a they had they automation of lack they advanced with and time in vendor limitations shared, consolidation. with knew of of their existing waste great

as BlackLine's evolution we natural capabilities for continue regularly. grow, they were the story a customer see a to

competitive of At European deal particularly Zopa, they inefficiencies with further We our fintech points sought the both we success replaced won and company, remove built a examples the financial many also solutions platform in legacy saw pain fast-growing over to a services. as and industry and strategy, that had years. of

With view their reporting scaling visibility. and close, on recognized multi-pillar the processes platform to further analytics and their business and StudioXXX. deal includes into reengineer future, orchestration, financial controls even needed enhance they financial to This they end-to-end a operational and financial

key solid On for our BlackLine. the focus saw SolEx international area markets, we performance a side, in

help recognized across leading divisions, enhanced as we when especially solve as signed challenges SAP the Sandvik Specifically, aligned the company their insights deal net BlackLine multinational visibility based new and and engineering control Coromant, a for landscape. can Nordics. a with complex global Searching manufacturing in with Sandvik well their

U.K. with customer teams. their Also and consumer goods finance, intercompany modern a looking a solve challenges the we is homegrown growing an The by existing in the in for to Europe, leading alternative solution expanded to customer tax treasury

ROI Given to record and processes. was IFM integrate company automate delivering to intercompany keen their this our previously, track streamline, adopt of

Holdings TANAKA and mandate. deal, In to we their net transformation automation Japan, a new signed supporting

SAP financial part which advanced this future to success. journals, core like able included BlackLine automated were demonstrate alongside power deal, joint a to close enable As of functionality we offering capabilities and of more the

presence requirements with developed our their North market also a comprehensive on financial partnership our our signing Japanese manufacturer. American end-to-end that their we with operations, We record Building SAP. addresses track a major by successful blueprint expanded through automotive

our a are breakthrough This challenges notable in gaining served we meaningful Japan demonstrate deal subsidiaries in traction. that Japanese but companies. faced historically the efforts strategic market, have parent X These wins represents penetrating

the With that, Therese? Therese. over to like turn I would to call

Therese Tucker

cornerstone for the catalyst remains Owen. strategy further and primary Innovation the unlocking our of market you, opportunities. Thank

technological value to individual We're It to across finance platform automation our demands. our of capabilities, for Our and anticipating shaping just represents advancement our beyond and enhanced integration AI operations transformation Through in order extends evolution, financial enterprise. meeting product deliver improvements. not future digital market vision the commitment current customers. the to we're

at systems our this generated launch financial November potential partners to modernization ability establish its our orchestrate, the transformative scale. StudioXXX innovation for customers life, this and in Both are of and its accelerating enthusiasm bring connect in we journey. and leadership for the has To recognize market significant Office to to automate CFO,

Several powerful administration through capabilities. initial XXX and companies additional Customers already StudioXXX large response and report Fortune time saving process and The implementing material compelling. has been feedback. are valuable providing orchestration StudioXXX's automation

the internal workflow capabilities automation. These benefits additional IT lines further they're their greater solutions, to reducing creating accounting and our close through designed and closed Beyond dependence team low-code achieving autonomy of on orchestration specifically time efficient and of capacity are get established resources. finance departments acceleration more

independently on early driving capabilities are StudioXXX's own of able example value days transformation teams and a control we and allowing time our how created enhanced single have their improve Similarly, processes. ROI. A within and journey visibility accounting adopter one of to financial faster great exemplifies to goals, their demonstrated with received empowerment. workflow, enhance operations their finance timely into a an This manner. set more how customers to control and up to we templates visualize enhance their greatly feedback additional illustrates in orchestrate customer to accounting and this After ultimately both recent

save time are tools StudioXXX, For but export customers example, they the need through third-party PowerBI we cannot to They out are and for insights in of on that generate to reliance data their BlackLine. native their processes, real-time tools eliminating reduce their demand. only also and that the other visualization

base, reach. The the differentiator, key share strategic integration extract insights a customers' deeply of partner will our the analytics within their are analytics of customer resonates Snowflake part position into CFO, market existing many This within through users. data StudioXXX. data our the capabilities. Snowflake to existing Our and partnership strengthens enabling whom infrastructure and In while has the our reporting Office with expands program from and deploy ability foundational coming the Snowflake become of platform months, of these features capabilities expanded as we particularly

Turning to amplify primary data transformation digital this with introducing our entry core enhancing initiatives industry-focused be matching with poised and the impact. capabilities, pillars. for pillar continues to point for Financial reconciliations. particularly We're by our to finance its close StudioXXX advanced big high-frequency

expanding integrations, Workday reporting generative Additionally, suite new providing leverage we've through platform expanding we're financial insights, analytics connectivity Oracle StudioXXX's pillar, and reporting customers more to comprehensive In our launched and platform capabilities solutions. our and ecosystem featuring and real-time internal new Fusion AI-based executive ways functionality. comprehensive AI of

We've an fastest-growing from has and initiatives. But strengthen opportunities well legacy the transitions beyond one ERP of as reporting of solution, end-to-end positioning has consolidation success us resonated to our compelling to the migration markets. also in Financial close capabilities also on great arising consistently ranking enterprise developed North North broader package offering, consolidation analytics value our consolidation record-to-report end-of-life seen and America, solutions. American capitalize

of across the wave and proposition diverse solutions Europe recent value successful underscores markets. across universal implementations Japan our for capabilities, close consolidation Our and validating end-to-end demand

transactions our demand business. and solutions complex are solutions to evolving organizations increasingly discussions customer emphasize requirements. their cross-border At for the pressing regulations BeyondTheBlack, global as regulatory intercompany for adapt and We increasing need seeing can manage that face

In solution integration complex intercompany response, enhancing advanced across navigate challenges customers platform, regulatory we're our enabling our to significantly capabilities with deeper effectively. these and end-to-end

a amplifies our adoption accelerate pathway Our this IFM across base. strategic SAP customer providing shared partnership opportunity to

We're investments with cash position is market our to map additional their solutions integration of requirements. recently that market solution their addresses in accelerate leadership premier practices, competitors, road focused growth and in a attracting was deepening IDC's solution market. partners validating its and deliver validated comprehensive CFO's implementations streamline from will strength leader. vision. recognition creating a are confidence talent BlackLine by of in as momentum which Moreover, strategic end-to-end this strategically invoice on Our our StudioXXX, to strategic our significant and solutions The both demonstrating further making our and our

road transformation, ahead, what simply accounting finance we be. We're of future look we participating our of a ambitious. in finance becomes more map not should the As innovation have and digital even vision

of of we're thus our journey. proud While just beginning achievements our far, represent they the

real to expected leadership market commitment to growth, as to Our value they our our customers to enabling is transform. us innovation drive expand and deliver

With that, turn it Patrick I'll to to our cover over financials. Patrick?

Patrick Villanova

Therese. you, Thank

core are building discussed As previously, initiatives, strategic we November our making at we meaningful progress on shared Day. our what Investor on

to While that early, benefits move this growth from updated financial we and financial ahead become begin initiatives we more the these our will next, the targets. expect into accelerate notable towards and as year

innovation enables characterized expansion strong, our balance margin commitment Also, healthy our incremental foundation financial maintain robust operating very remains our to This and sheet. foundation by a customers. to while to value us delivering

million, declined detail. Total in in quarter results Now X%, growth revenue revenue revenue turning expectations. up with and more was grew Subscription our X% our service fourth X%. to line to $XXX

RPO recurring FX. was impact to Annual revaluation represented the We ARR $XXX million, end than at period. headwind up of or up RPO Current were similar ARR, up a X%. due was saw to to X-point the growth. revenue, dynamics FX-related with FX in X%. X-point Remaining an quarter, more RPO, obligations, X%, performance primarily or from approximate the

XX-month some mentioned with X%. As quarter, growth ARR impacted deal X% Calculated Owen RPO. velocity growth the saw was and slowing both billings of in earlier, which we also in trailing

quarter by impacted point. FX the billings X in growth

quarter count the as end growth our in shift moderate see focus customer Our market. impacts at we strategic the customer as was X,XXX we to still the middle of count

XXX% rate moved quarter, fourth of Our number but retention mid-market. or stability in We multiproduct which impacting many quarter included further revenue and this reflecting across renewal was XXXX, the a from was X-point quarter, were opportunities a increases this rate, about price XX%, improvement headwind saw expansion which Net of enterprise FX. in into NRR. both NRR,

to a Strategic the number in record had of the a XX% of Invoice record products in quarter. quarter. cash sales represented deals

We solid deals this performance Close. new in also and Partners both of consistency involved XX% across Smart were from saw with existing opportunities. large quarter

SolEx represented dynamics the performance the to was below revenue due previously. QX, revenue. SAP XX% primarily of fourth deal in In expectations our partnership mentioned quarter, total

margin. Now turning to

non-GAAP drag as Our non-GAAP margin free gross margin X-point $XX expectations. of reported. the XX% almost XX%. line was a gross at operating and a million on representing in operating with flow $XX BlackLine quarter. was nearly our cash Non-GAAP XX%, operating net was with We represented representing flow income flow quarter, non-GAAP $XX XX% XX%, margin to cash subscription attributable generated margin margin net in in free margin. a the in income million, cash of our million Non-GAAP FX

And last, $XXX allocation, in million regarding cash and equivalents versus we our capital debt. in cash balance million sheet $XXX and have approximately

As planned, begin first repurchase program our previously expect quarter. share the in announced we to

XXXX, to performance. several shape our will items look we As financial

our particularly Foreign is our to point QX. create exchange headwind total full year stronger observed approximately headwind are range. This dollar in X a that continuing trends we a year the in from expected full revenue guidance embedded to growth impacts, U.S. rate,

in profitability in result a years net recent rate our guidance. our which for non-GAAP will XXXX, tax Additionally, effective also higher over sustained income improvements embedded is

year. these our With outline guidance mind, in to for considerations allow the me

quarter in X% million, the XXXX, $XXX revenue to expect of approximately first representing growth. we total to be the million of range For GAAP $XXX revenue X% to

of range share basis. $XX on $XX margin XX.X% in or income range And in to $X.XX of net to a non-GAAP expect the be operating million to non-GAAP $X.XX attributable to to the million, we per expect XX.X%. be We BlackLine to

weighted average to count be Our is diluted million shares. share approximately expected XX.X

follows: growth. guidance as expect to $XXX $XXX XXXX, the total to revenue is for million, be the in our range of X% X% full And representing GAAP We million to year

We XX% be net margin or expect to in the $XXX range XX%. the to to million share expect of million be $X.XX of range non-GAAP income attributable a to non-GAAP basis. on in operating finally, to BlackLine we $XXX to $X.XX And per

is be average share expected approximately XX.X shares. diluted Our million count to weighted

operator to to your discussion I'll With take now ask the questions. that, the open

Operator

first come Morgan Our will question Quintero for Instructions] Stanley. of today from [Operator Chris

Christopher Quintero

this versus a I start, 'XX? to much to know for macro how velocity throughout this ask, how your And expectations? execution Maybe was in curious deal you're lower Owen, expecting year came want I But to you, bit just little and fiscal continue quarter. macro

Owen Ryan

Yes. I to would way your I the again. was say, we executed with fourth pleased Chris, all, hear good in first quarter. of the generally voice pretty

Some closed had it fact, gotten inability were And was pretty as first around close been things we've of to timing than of deals. decisions sort in those the a this positive of the weeks number way deals. have X customer the that in more our year of

so our was And say all from end really. execution I it wouldn't at

going a around level. things caused timing and little conversations where uncertainty, issues be, certainly is those any a market, U.S. are are sort permanent to of the in they that, think changes of that pause, of little at bit a might in particular, more tariffs on lot of are going have of changes things I and bit There a of than but lot

those even the Japan like been through. is deals. dollar to with did a that little about a overseas, Europe of make concern growing there's figure is the fact, economics that are work I more bit in I interesting of Therese and some trying work places in pipeline little will the been and strength how has having again, U.K., though and where some impact of U.S. just it, will internationally nicely. say our the our both quite an in out people bit And are to But issues some what's trips

Christopher Quintero

there? That's know on the about we super for duplicative throughout helpful think how gross the I should to it. the and about costs, have should Patrick, margin great margins, you of Maybe phasing Got the think year? we gross but how linearity hear. one the

Patrick Villanova

I Chris. the question. appreciate Thanks, Yes.

for margin gross a from throughout the expect standpoint expansion should you slight consistent. most the what fairly year, is part, but So

to older the of and GCP or to part year service migration, as that of or eliminate planning on will centers some are are some redundancy. decommission of later We the pace the service centers this

gross an margin serve this is a The is other at drag as FedRAMP revenue gross margin element with about significant there will but That investment point the future. our year, X.X a investment. on work opportunity that in be

Operator

Patrick Schulz Our coming next from of of question be will the Baird. line

Patrick Schulz

all obviously, a more I in priority on it's just SAP And with first and a standpoint. that for background go-to-market collaboration the color having strategic coming appreciate I the SAP. and key Maybe know provided. like you from co-innovation Stuart's relationship. you guys sounds the

the how building to thinking from 'XX. SAP on any relationship Just now accelerate? for this in the color we about really right should place be blocks contribution Are in

Owen Ryan

Great Patrick. question, to Good you. Yes. from hear

prepared think last a I I said remarks, reset. year of was a sort as the of in little bit

of you a you As think settle Therese think there to last took months, the within It have as for about a know, changes SAP. lot if I down. those if I But of I and was while X -- we in to chairs spending the need time been a of them teams laser-focused have really together marketplace. to get been been time of mean, a on what do sort and lot we've I spending able our working. with lot

we've the the the that see move things pipeline building around sort been of to to of cloud. all is with opportunities the Some waiting

are pushing that lift ERP in the because the value doing market first customers And shift both I doesn't as an deliver serves migration SAP want. a think that concept and BlackLine and together this necessarily well finance of just is

other's you if able in time to we of And other being of that drive really each into show that and lot reps. we're things so get home. sort our the that now and respective mind just really sales spent to message into kickoffs a minds will, a the few in And share, cases of

to and to road really some what things think more are we're you yet, tell in May, to on else I accelerate maps to that continue do. we'll going don't announcements have something trying want we but

nothing was so working together. of other support has critical the incentive time. this been we're plans getting think cohesively The aligned point I thing in short at top the just more that spectacular better from

So way the and with the in have despite sort of building pretty SAP, liked the place we we right feel 'XX XXXX confident beyond. not are for it would that all ending blocks

Patrick Schulz

And Okay. one too, for can. Helpful. more maybe Patrick I if

Just the provide assume more could some embedded should I you expect the you takes to a guidance environment color of trend growth execution maybe little on rates this of puts mean demand we type and deal the and bit what net for in year? how guidance about and does and retention talk year? the throughout

Patrick Villanova

Thanks, Patrick.

X% So growth be without guidance, to we're which sheer X% as at with the X%, just year X% to X%. a you to think to FX, be to about numbers, full QX, looking X% growth guiding would in clear, the revenue of

to So exit you reaccelerate of that, guidance for we and there's think inflection about as year an expect in how XXXX. terms point the implicit in the

of a then way strategy spoke think of that is guidance And the taking of the this will taking So about initiatives for about, to and that's would I overall from lot just the and a Owen it traction lot they about and a speak root overall perspective, part the that are strategy mathematically. things year.

Operator

of America. Koji will Ikeda line question the of of be next Our Bank from coming

Koji Ikeda

of year I the wanted of the to confidence that, on that's sounds guidance. guide. be in follow a on comment to lot because the achievable like implicit this have inflection going And that up you it

that what us you is in could the giving maybe through possible the XXXX? you inflection is confidence the walk So visibility and

Owen Ryan

for thanks question. Koji, Yes. the

in and footprint is things I Remember, beginning February, that's of much CFO. sort now The mega things there's different pipeline deals larger. are if enterprise the of are of the the nice into Therese There's stepped really to way think when to through more is about we sort Office The see role, about and just number of mix to of company. becoming want the rapidly. the us the what's our that just growing diversification the of is manifest talked the space. a in the from a giving size relevant confidence that from the beginning September itself I of think we quite It's strong. now and more geographic quality we the enterprise perspective of are

able for optimistic going be of the on sitting to X- bring be record us about We're we're and that organization. X-figure feel deals would what a that into level we to

you transformative And to kind start platform, opportunity and piece not more where those, we these to think customers the at much just about what so when have a are of offer. looking broader are of

so we what's feel good on going about there. And -- pretty we're pretty

what other matter that with the just think of things I sort is we're doing customers. our

heard strong there's driving Well, increasing. velocity a You renewal, go-live that? us things, talk The revenue about is well, the of what's number right?

customer touch our year-over-year. which maniacal customers, was XX%, customers, our make points up for you I'm with time points touch know those is Our all about to trying spend that sure we

improvement we have. want to that an well-adopted in of the seeing We're mix customers really higher

to by a Our kickoff time down start to signing XX%. is project from

year-over-year. and Our partners embraced. get helping to like are usage in even that are doubled number things University BlackLine ways in, moving really leaning of these deals the And

get start look all you that very industry. that, you progress to when of we're making feels good, into in the So at that then

So year, X we belief had to we the concept, trying value Improved really industries we our last launched to industry. do. the of important what of our were

conversations our are beginning -- on, should are level X what in and more doing efforts the opportunity, stamp about seeing That hey, is FedRAMP starting important. state rolled governments this state in the sort out to space, DOGE The will sort which everybody in have things is but pipeline be things DOGE been just most company out certainly to we're talking industries pressure to So show of that year. up inefficiency. a industry of that huge now that's and much is more an local vertical, some we've on focused we put put where the and of and starting are our maybe

seeing well. opportunities those we're so a up pick in as And nice

things it of the when together, XX, to that we're look were So would wanted it XX all we we're we you bullish I more November on all together, much February we that think because the and business. things do we at the start was put in to on happening what said do, you XXth, seeing

Koji Ikeda

at absorb. heard so too just and end definitely BeyondTheBlack commentary go-to may. a of customers I've some packaging really with BlackLine driving liked all from think. strategy the with are I that perspective, one just But with what how hearing the push much follow-up and are did perspective if And deals was market and they push we some tech so just these But what do is hear and of trying change? -- what deals, introduced we and how all on the and on changes wondered from And out just to here, that positive a the deal we at dealing time to we pricing figure market forth. a We for as

Owen Ryan

listen, question team going Yes, customers, partners. out it's the ability own not I have our a product absorb it's and great everything to think And at. only of because rolled tech Therese that's to people's ability and to for and a has be reality that's for on our fantastic, lot of innovation the the challenge. XX a which that bit everybody a we're in but It's to digest the little just has that last proven months, XX our been

you process need messaging lessons going clarify. that the And go you what don't there's die. -- through But will. would to the need we so the if there's if beginning call very way end, we to you're hard And from working things -- innovate, and learned you can we commercialization all we're and to simplify very to some

things we've so sort the get the can chosen into to marketplace. And of we

us about learned just timing contracts, perspective customers there's with have our we longer. won't work these partners late earlier of a probably the It's And lessons positive to think want that I acclimated. the them move to bring it conversations, how in thing and we I and best these the with market. in to doing to doing But them lesson well. BeyondTheBlack learned thing from with be we're get conversations too of that will other sort a in able to doing If be to is really any once have then November, just towards. year through the that's out a as get say for these definitely we to share year what the probably that,

Operator

of from of coming be Citi. Steve the will question Enders line next Our

Steven Enders

the Okay. Great. and I been of guess conversations out year you those packaging so revenue ask together? of roll what impact pricing kind been guess, model what's potential means far. kind you've or the are to potential think changes maybe to the want about the And on about to comes that I that of impact we to as thinking how customers. starting I impact how for

Owen Ryan

the Well, received I'll about on you of talking just take the if it. mind some don't how it's economics the And Patrick, in being market.

So upon of the And pricing. just as work of to has, the model number it's a the reminder, number entities. transactions, changing based of we're concept they the ERPs shifting legal and number the amount of the this of of revenue with company

generally, little it as and standardize been company your that bit things pricing them work us We generally seem these this helps pricing to so expand which of customers one they -- better. far. with officially bigger flexibility unlimited customers, it's simplify clearly, agreement with gives early we gives our the our and as to reaction a for It grow. in so to to like they apply January, It certainly positive. seems the has launched it And

team. also get the importantly, accounting we've the beyond ability accounting pure But to of beyond matters, learned as into other pure already, organization parts the

conversations, by more we our about, as lessons would that always the people becoming The as we We're some weeks with thought we're year. large, of into we're be development. confusion CFO, of only but positive message, there's on to We again, of they're as quick of Early I we're it we exactly ahead a seeing accretive and solid. to expect Office and making again, be. X sure little our slightly And relevant bit a partners are say through pretty this we've where working we forward. move do learned. would those so think adoption, the the

The because quarter But the we our some talked consistent users so the less do make our customers We at Investor pricing Again, to for larger Day. were is the attrition and well. need. about in principally using customers is more we with what really saw efficient BeyondTheBlack of technology need some model of they they fourth perversity this the this that downsized of of our strategically. sort we

want talk that's think I the So something to this you need Patrick, to to you about that away we've new But model. -- could we and accelerate recognize economics of share? taken maybe continue to pricing just moving

Patrick Villanova

Yes.

for that assumptions last lessons I most overall a of validate one of running there. were this base. think the some it we've learned of implemented which highlight part thing this model, to we've our as broader of been pilot that on and effort, validity a the there success good a But lot year to covered about Owen

relates said next that the Something of we this Day. see years over investor account our think model fast? too message too as question X of that to benefit do as overall with keep this cumulative mind, there and in rolling is part that to a to growth I base, in time. over out earlier, a that expect consistent our And at Investor though, is was Well, pricing, we is a it X the much we're to

achieve we XX% target model. XX% to As our

then this within are to year into logos X So this model something over next QX that we is new embedded as is out and years, that in that X and introducing well. also of the year the rolling

Steven Enders

the magnitude view think on the wanted with billings like the new that about deal view the secondarily pipeline maybe do a or guess that, I we or impact perspective how pushing Okay. year the you -- there. helpful frame that way the pushouts maybe And the on XQ And then and had I from of context happened perspective? of Perfect. I to is a like to had here. ARR an there ask That's guess, for some of that from the with ARR would would as impact kind deals out, 'XX. together have coming development from have of that impact

Patrick Villanova

couple there. earlier, now. development strong things Well, of some I several been guess for our I what time for To pipeline reiterate -- quite said a has

And great indicative any deal we that at the of So perspective. velocity the the don't from demand a end of overall believe indicator that's of a in year environment slowdown slowing was pipeline. an

even built In fact, faster. the pipeline

X-point of So FX the you're in and it was broader out of but one don't on One in a in largest demand I driving about the factor regard, to indicator it that's an and when was thinking that quarter mind keep each DBNRR ARR, I was thing those matter. think when -- headwind a believe there, you're metrics.

of So to something that then a the portion definitely when doing a slipped comparables were is you're or consider smaller deals that. period-over-period. And subset

Operator

be coming next from Alex Sklar will Our line Raymond of of the James. question

Alexander Sklar

or know Officer Owen, go-to-market brought I to you Stuart? don't about the you know talk Owen, brought the you this, to year, a who landed Can Therese, the any new I happened something bigger but but with SolEx. that Great. said coverage you take kickoff Chief organization. on about a -- sales I start wants to lead Commercial on just Chief of he's new plans think the process Commercial And picture, tying compensation sales just starting, changes some the mentioned at you organization,

was far want I to year-over-year. there as go-to-market as happening just what see So

Owen Ryan

Well, okay.

of learned, roles the changed team in than if from were allowing We with for He other years our process I when was we've successor. from now candidates. him us So in looked we and ago. the and a our We wanted incumbent the about different that We Legal perspective, leadership X knew Therese work find and through Officer team. a Chief to whole anything to gracious to a year over retire. interviewed lot these

joined. here our were Stuart about all XX meeting York a New today, very, And selective, people pieces so have what of go-to-market very, across and fortunate of we do. of had By we in very leadership feel to different we very coincidence, we

It probably sense been in the here's of couldn't a better have at. meeting we're

know what want we're we here's going this get to to we and it. drive how Here's done year

into going lean clear the just think -- was I good pretty that some in, provide really and to interesting it Stuart perspectives. meeting, was

know, was And of trying bit sure for are things Obviously, we encouraging do. but this day, to SAP was a that today, with we need as in an facilitate was appropriate connected, getting make what work between, it way. And that a you helping so announced people I back. think very little in doing in his he first bit official to quite us to

And all so been good. that's

expect, the at been board did here. But his a forward. and at we disruptive positive to was I told want be we all for in to he's to brings grow official and excited him well. of do to move weeks, him prior today very, try have experience with So what from really was serve what team continue that him, on life us day, he BlackLine we we us to going But very and in get even us though the he first feels it now X have the I be think do. helping I like importantly, better with way. SAP And think is to

horizon. have more on I things to are the we and excited think we're good So couldn't here, him -- be

Alexander Sklar

Okay. Great.

I to far select group joined, that as anything earlier clarify Just point quickly, that for the about tying Is SolEx. the for broader changed so he just was though even as that -- just compensation before or to organization? want

Owen Ryan

Okay.

everybody we we every did changes make group. some year, them tweaks this our form comp SolEx So an to catalyst models but did like year SAP

on to So think good we of work now of that to have with people a dedicated And a are the us. that's has effectively be we aspects for done SAP what team differentiator all team.

SAP a the lot that. team positive around from got feedback of We

own team is Our it. embracing

do we need pretty And what so to there. we're encouraged about

all getting BlackLine SAP just cloud-based about As as far revenue. aligned. It's and

was their As Therese's -- you in package. strategy putting and remarks, by trying done EPM fits it is, putting into do. they're BlackLine us know, they've well There things that SAP think what some prepared their to are that. I what into

Sapphire getting their was So that sort May go our into able close through you timing well, we product. StudioXXX conference, And believe a June, in that FRO, all launch getting the and reporting have then important. is it's core integrated intercompany. that there into I to for already And there they they being or PQ-ed. FRA know capabilities financial as call it, of as officially that obviously, But it their in fully again, group package

we're do things pretty trying to drive behavior the are it. and about those to So excited

Operator

next Pinjalim Bora of the JPMorgan. Our coming of question be line from will

Jaiden Patel

would but great. on Jaiden a and assumptions You FX be XXXX any more churn talk around the XXXX retention to in get Pinjalim. This mentioned is the Can for of QX, both guide? the color the through about bit headwind dynamics about you to

Owen Ryan

I'm think to trying about the things.

that So the count lower of better a churn think that the of customer I something we're work that for probably 'XX, that, the customer at is part feel to on count our market. end we'll still continuing And through the way side.

not tend to Now the see. very that's the we'll topic but the customer on for us enterprise from dollars be From count, not certainly there, churn issue biggest it a really space, a these large of that's attrition. is more something much in

things we about, talked that right, the I'd go to back earlier.

know we a number the anything certain them touch before time like positive renew we then of account very our through to or attrition they're if year with times our partners own sure a customers that customers, having on the management, and to reduce that ability the people Our whether we to help and our right is it's impact. substantially. And make success touch sort of executives, churn it's for journey, can a our our frequency, greater or our customer account we

sort drive from of is of those piece to and probably a seeing this close more the earlier churn conversations customers much other maybe last working our big down sure big down But just the potential that which financial we're just percentages we'll 'XX in beyond them. do we've BlackLine would all than things attrition months perspective, bit. and that's year-over-year the a indicator will So of been far of XX look been again, the would greatest what 'XX. has that and a right of we customers what over come for pure of little we probably can expect help more the journey, the what sure sure is on that piece a even with on making understand making in making those that they're And

Jaiden Patel

it. Got

guide? And does the so, think reflect then philosophy? if we should change And in baked Okay. about one, the guidance how into of conservatism last a magnitude QX

Patrick Villanova

Thank for I the for conservatism year. the best question. think QX the this know targets and the this if the capture achievable don't is have word apply, to I these guide, some some philosophy key I provide assumptions and I the risks on over will within clarity are there. transparency course the word you year. probably of risks is the numbers way the that to appropriate We, key for I is but on for assumptions influence think that guidance out And the could set year. and

change these from targets necessary, standpoint, key some a if continually I And the that the then, to guess, a signal philosophy these And But will each market to warranted. and reassess theme would say, then like quarter, assumptions. goal we IPO of is the extent transparency is overall, of to reassess if my you and build as X we at guide. part upon philosophy. markets. what both within a done It's years in And since of that the we've But balanced. built is the X, credibility here our credibility look lot thoughtful this ago, I

Operator

Jester next Markets. of the Daniel And line Capital from the will question be of BMO coming

Daniel Jester

quarter. just pillar but what's BeyondTheBlack, the Maybe be some share enhancements It cash to more there sounded at of like in there. resonating expand would were anything you in momentum great. particularly was announced that the can prepared remarks know you I around product the that invoice strong can

Owen Ryan

Yes.

of think things. we've the And made is product. I I what BlackLine Promoter looking improvements was yesterday. competitors four, Scores of the bring better in we've have people so some there's from able of we've Net the that Two, to a team. quality that doing, been at decided think upgraded sort opportunity. a is couple One think in I I Three, we're

X. so BlackLine, a positive And we're for

is will, sort of cash in negative if invoice to XX. Our archrival, you

can their activities what like up really they partners because Our are stepping bring. BlackLine

to of been in another we're And piece see so critical what starting cash. that's invoice to

getting even head more We XXXX. into nice all about together. as we had We're optimistic a comes really pretty quarter. that So momentum

-- to some as quarter. me to by on we're sent second just interesting we have in the cash here, the will some was updates in We product talking phone you invoice to time it were the

that move. and on So regard, all we're pleased to going than you'd like, longer takes it stuff on it always we're because done good get in but the

Daniel Jester

takes taxes puts think Great. to but a on lot you, guide cash and there's with Patrick, also progresses. regards you FX 'XX cash don't and I I And free flow, then, to as of know

about you into how any share about So this year? we should can that going thinking be color

Patrick Villanova

One, we of only probably Yes. at the cash year, on have already an a the and on the which profitable, release allowance our profitable There's the free been BlackLine. but did notable you variables X that end hit for have did nail with comes not head, release, is be tax in foreseeable to there we flow. are indication it probably intend but burden, cash future. we which at But that historically the saw valuation we a not here you

to a company to a about the So think with I low cash would this rate basis about our in tax or think on a prospective that where profile how it, is land. probably mid-teens would on non-GAAP if basis a typically you're estimating

in that's markets interest went our cash we with a intentional of as than see, as aspect of rate that year. which we a was through flow, other last lower can balance, you The to free May XXXX, coupled in and cash have the part lower refinancing prevailing

Operator

question next of Goldman the line Sachs. be Our Adam coming of will from Hotchkiss

Adam Hotchkiss

of large up deals? partner know you've fruit to the wanted of paying much the they majority your ask, done in starting you picking I influence off outside network that Are there? I to vast is pipeline, work how SAP? the On the see of the

Owen Ryan

well, I A our I one SAP's No, couple of things, of pipeline. Yes. say, what sort part important would self-generating. call of always would an is

more executives more reps of people the and lot high-quality field of there I trying the those to possible conversations. need sort what the Therese a confidence them to we about them with in what is help art out doing platform are engage So BlackLine. our those do our in and with are the and with

in upturn partnership We've nice seen referenced with a that we in the remarks. a opportunities Workday, prepared

own then what's so strengthening cloud And our in through but it's relationship through what and on we're so on going the migration, pretty broad, also the important, and with Workday. equally generating SAP yes,

Adam Hotchkiss

helpful. And quarter, picking that's of that business? a into year the any record And up product really helpful. thinking be how why now That's about just then then color you're would the Okay. percent the next on as strategic really additional

Owen Ryan

went I'm it glad why we charge you of year listen, sooner. pillar said a why I put things. think, last now. I'm certain through in where like, leaders -- appreciate. didn't look, we Yes, happen it's process But

And bear. want to day, and that success, come say some so don't cash, underneath even get have the person when financial single FRA, drive to close. sort leaders intercompany, market up you focus, it's are additional have eventually that throat whether there to choke. invoice I if that sub of, our But to to you you starts to that's waking each every trying the When

bit And made so the more that in success it's a leaders lumpy. pleased our We're have the pretty progress driving with always little pillar market. in

solution. Our with reps comfortable the gotten have more

and when that's need consolidation go it's building shy about product, they they're it's invoice cash the spent they our not leaders to confident and do go the pillar comfortable or all more have intercompany in what that helped that no conversations things, advisory their time of introducing we more leaders We to are sort pillar So an way our like of on whether and recommendation we what their what them, have. our board in do they with regrets, partners lot us. our at of comfortable to to and a push to in give and partner plus with are much confidence important can been of an BlackLine, into

Operator

coming from Citizens. Walravens will question of line the of be Patrick next Our

Patrick Walravens

Great.

So to most a thing single what think focus information in you on call. is good on this do important you Owen, XXXX? the for lot of

Owen Ryan

X would is be -- question, would it rolled sure making to back it simple the and all the how success our pillar with things. do we our Well, really make marketplace. goes One say teams, so in a customer effectively teams, and execution. I our communicate yes, innovation in word, partners that Koji's we've bring sure to sales leaders, bear our out, can

lose on I that I journey, we those make with track, them, then and then do foremost. proactive being like think So do a they've And first we full the always on those you about I'm help How we see are how thing to I because sure that. that stalled want for them customer, BlackLine told and their for second much of that's back what feel We're the never they've to and engaging probably more worried customers take what advantage already purchased get with to the customers down and road. opportunities that.

platform built against. help to just out finance That we're execute the trying want power one Now we that whole pillar. of we is not are to keep digital build inspire part -- trying our guide we saying That's that and and transformation. to

X more those execute, so execute things. that's It's Pat, it. And on nothing execute,

Patrick Walravens

like All the a right. the What's it the second part If I you could stalled on on who journey? do playbook? for customer follow how up, they've feels do

Owen Ryan

mean airline, example. the saying, use lens through What Well, look, we've about we can well as doing purchase our where stuff you're it. we not and not using we're it it or that all. information taken industry we've Yes. at look, big let's customers I is an that's using the we're they're gone either a see back,

BlackLine using where on how you your anywhere is, not help get journey? You're back set peer can that near we

own information the doing of to data out we're has real and around to us with whole that to what you "Gee, benchmarking can figure sales And say, these over trying that's D, came our are when industries an it's use. kickoffs over And for and industry thirsting last a why And moment that have we're customers C, conversations. become just conversations and our just and lot to information network can I year. That's B, couple we and use their more go because they using information better airline real those of sort than aha past customers E our I of for F data increasingly out important mean, are A, people using am." so able our partner back have weeks. this I'm to the

them that better, we're we and get there. but art the help of possible, showing So the them we're can also can you showing you says, do reality

Operator

of be Jake the will line Roberge from of question coming next William The Blair.

Jacob Roberge

push to like on any up seeing potential the or velocity of already follow kind if QX would to deal It continue cleared new this curious point? closed year wanted for that in expected of a sounds Just have you're that deals. with you overhang to have in the you Or or at in QX? but that new lot slower them feel there's deals year, the if if like just close has

Owen Ryan

extra of on That's a these in eyes I really because good deals what think level. seeing the some question we're things some company these particularly at is larger

prospects what doing sort and a our needless more they I to mapping couple walk But examples. they're go say, there's are before as through bit live. and road blueprinting is so customers of could And a doing little

sort start deferring date. they're of So

we've been we're are resources even the win work, contract to verbally they're So start have out trying a don't told going to aligned. gets signed make the and though sure date pushed their as we

One of must be is implementation a a the things must partner higher sort be a BlackLine right thing likelihood the with and be successful that's perspective. you customers of what want to and doing true trueboxes And up the check, I And that's way. think them our because perspective, now the customer perspective from what success. we're good a with to for can running more get we doing is true for us the our of customers

stats before some we're sort of of shared has from velocity is signing I contract how increased. project accelerating The kickoff going live down And to XX%.

got little those about things, tonight. you whether bit or sort may guys the just I this to tell think get longer. while take of the to quickly, able And contract so that one be I of I've not I going executed debated a deals more we're signing

at awarded contract large which were of end very we deal. the X-figure So a an January, is

year, start. And what come the X, the probably first the of And they the back months it that or place. like the have the start get in sign things X end was want the our customer quarter we'd the to until X, would first then expectation we're because to consign defer to we but date customers the well, going paperwork and and do year second of probably and still in the is, they asked

XXXX. It me up in do so all again, this And nicely sets much very for XXXX. for doesn't

way in about construct of the XXXX, talking would fact, today. tell me there'd be recognition In revenue no the we're deal Patrick the

think the size I little that risk But BlackLine. right these support us investment on deal. bit the and may partner customers resources I commitment now customers are improve success the right more of the the of prudent because BlackLine off internal be the they're and get support, careful the a their right to a better likelihood with think eventually, going for thing in with I and from making right that's the the way, think because of So a is running to

Jacob Roberge

front, And improvements to is to revenue of you your Do start think reexpand well? retention be feel could think now rate the see mid-XXs on to Do just that as the rate. churn about seems to hear good then retention stabilizing. kind the way you then NRR forward? like that And renewal in moving things helpful. really That's we Okay. right

Owen Ryan

value. when just that driving some to generally And the we that do them with of That's them of goal. opportunity more really have spending model, buy on that's our the of only number made the certain by of close more because, And customers some because million. million that we've pay we look $X you what's us about we segment, again, sticky them us, our it's industry pay towards what been as And why an they help example, I hundred is at them of a $XX journey. versus what thousand a more couple to provided over because and you have us sort think see $X million. if we think we've And customers

to basis the sure is And the expand that so that's help think make really purchased I mid-XXs what we're into combined on use relationship. Do XX% do they've what customers is and about right? trying that already a that

personally who keep the to as I driving to to we of what higher, Yes. but towards. we're like see of feel we've it's right trying our even customer things, little right half what I think you bit selected the customer I mid-market. back success XXXX, And be mattered pick that's do turning the velocity do had like we it go as customers point a that's a when increasing. and team that going got you you're in is the to others from live seeing

You started see the time decreasing. to get

so customer selection matters. And

the And that It a have so impact, where to positive more mean we to but will can't sometimes absorb that BlackLine smart. like you with us them BlackLine. these I customers doesn't think mid-market really we've don't way the have just particularly improve, volatility gotten room get would in absorb for we

So we're about that. more being smarter and prudent

Operator

last for from comes of Securities. today question And line the the of Terry Tillman Truist

Dominique Manansala

Manansala is Dominique Terry. This for on

sector? in revenue the what or shift the meaningful realistic the making mentioned, So time public into motions certification, all seeing what's beyond are specific from to administration, And expand I new segment? go-to-market potential you the the line for FedRAMP guess you with investments contribution other

Owen Ryan

Yes.

So the things doing. one been of we've

in gotten So big additional the marketplace a that signed first all, now capacity partnered are we've the some to space some We've We're resellers have of couple so of dominant us. with up internally. federal SIs practices. representing up looking sales that add

most kind in really very spending been a and us fortunate that of these right target city large that we've And to we practices. working state of lot for to So need we've of their through introduced what do. about are some the also with time have things then partners them been agencies that

opportunities. sort already well in as real that budgets is year that's environment drive they their certainly couple because sizable. efficiency of to from of can started has so connective the through decent more for trying we're this to that so towards back technology, use raise see we're And sized perspective, of very end do tissue a what a last government There's the we important ones been nobody some something are quite working if looking of that

pretty far. we're encouraged so seeing And so by what we're

out that Obviously, short-term efficiency, we highest But think bit to certified certification Washington investment being try of to medium we don't the it Patrick a FedRAMP we'll call. it, an have think going again, to and share the of have do being what's long for then while jinx matter. of has caution. more think XXXX in that that of But built May talked for want on to might about goes at level improve term FedRAMP, news FedRAMP We little create of to don't noise abundance our when get revenue I is to will just the positive. plan first into I level of but again a our lot I into in

Operator

you. over Please conclude for to Owen like Thank I turn call ahead. remarks. go closing this today's to Q&A would does the And session.

Owen Ryan

you your to with do. night, Guys, is Talk We and you the Have everyone, to We trying in take the you. journey want path for thoughtfulness good support soon. really with thank right you that and to everybody. we BlackLine feel we're asked. for like what belief thank which excited on appreciate questions. continued your a just And

Operator

Thank call. you for conference joining today's

may You all disconnect.

BlackLine (BL) 11 Feb 252024 Q4 Earnings call transcript