BlackLine(US:BL)2025-05-07 20:06Part I. Financial Information Item 1. Unaudited Condensed Consolidated Financial Statements BlackLine, Inc.'s unaudited condensed consolidated financial statements for Q1 2025 report total revenues of $166.9 million and net income of $6.1 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $479,536 | $885,915 | | Total current assets | $1,043,353 | $1,092,404 | | Total assets | $1,781,148 | $1,825,036 | | Liabilities & Equity | | | | Total current liabilities | $630,292 | $422,243 | | Total liabilities | $1,327,427 | $1,341,884 | | Total stockholders' equity | $417,903 | $446,669 | Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total revenues | $166,931 | $157,461 | | Gross profit | $126,007 | $118,364 | | Income from operations | $3,575 | $1,748 | | Net income attributable to BlackLine, Inc. | $6,055 | $10,829 | | Basic net income per share | $0.10 | $0.18 | | Diluted net income per share | $0.10 | $0.17 | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $46,742 | $50,425 | | Net cash provided by (used in) investing activities | ($399,041) | $20,990 | | Net cash used in financing activities | ($54,311) | ($10,925) | | Net (decrease) increase in cash | ($406,370) | $60,278 | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q1 2025 financial performance, noting a 6% revenue increase to $166.9 million, a decrease in net income to $6.1 million, and a strong liquidity position of $866.5 million - Total revenues for Q1 2025 were $166.9 million, a 6% increase from $157.5 million in Q1 2024. Net income attributable to BlackLine, Inc. was $6.1 million, compared to $10.8 million in the same period last year104123 - On March 4, 2025, the company initiated a restructuring program, reducing its global workforce by approximately 7% (130 positions), incurring $5.3 million in restructuring costs106132 Key Metrics as of March 31, 2025 | Metric | Mar. 31, 2025 | Mar. 31, 2024 | | :--- | :--- | :--- | | Dollar-based net revenue retention rate | 104% | 105% | | Number of customers | 4,455 | 4,411 | | Number of users | 393,892 | 387,050 | - The company's principal sources of liquidity at March 31, 2025, were $866.5 million in cash, cash equivalents, and marketable securities140 - During Q1 2025, the company repurchased approximately 0.9 million shares of common stock for $45.5 million, with about $154.5 million remaining for future purchases150 Item 3. Quantitative and Qualitative Disclosures About Market Risk The company faces market risks including interest rate, foreign currency, and inflation, which could impact its convertible notes, international operations, and customer spending - The company holds $866.5 million in cash, cash equivalents, and marketable securities, with a 10% interest rate change not expected to materially affect its fair value due to short-term nature164165 - Foreign currency risk from international operations could result in an approximate $4.1 million impact on cash balances from a hypothetical 10% change in the U.S. Dollar's value167 - The fair value of the company's $905.2 million in outstanding convertible senior notes (2026 and 2029 Notes) is exposed to interest rate risk, despite having fixed interest rates162163142 - Inflationary pressures pose a risk by potentially affecting customers' purchasing power and technology spending, impacting sales cycles and demand169 Item 4. Controls and Procedures Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - Disclosure controls and procedures were deemed effective at a reasonable assurance level by principal executive and financial officers as of March 31, 2025170 - No material changes occurred in internal control over financial reporting during the quarter ended March 31, 2025172 Part II. Other Information Item 1. Legal Proceedings The company is not currently involved in any legal proceedings expected to have a material adverse effect on its business or financial condition - As of the filing date, BlackLine is not a party to any litigation expected to have a material adverse effect on its operations, cash flows, or financial position174 Item 1A. Risk Factors The company faces significant risks including customer acquisition and retention, economic uncertainty, security breaches, reliance on third-party cloud providers, AI/ML integration challenges, intense competition, and a history of losses - Business & Economic Risks: Growth depends on attracting new customers and expanding sales to existing ones, with economic uncertainty causing delays in purchasing decisions177183 - Security & Technology Risks: Security breaches could lead to customer loss and reputational harm, while reliance on third-party cloud providers like GCP poses disruption risks189243 - AI/ML Risks: Increased focus on AI/ML introduces risks such as implementation failure, reputational harm from incorrect model design, and navigating evolving legal and regulatory environments196197 - Financial Risks: The company has an accumulated deficit of $44.1 million as of March 31, 2025, and quarterly results may fluctuate due to long and variable sales cycles222224 - Third-Party & Competitive Risks: Business relies on strategic relationships with vendors like SAP, and the market is intensely competitive with some rivals possessing greater resources240206 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company repurchased 920,000 shares for $45.5 million during Q1 2025 under a $200 million program, with $154.5 million remaining available Issuer Purchases of Equity Securities (Q1 2025) | Period | Total Shares Purchased (thousands) | Average Price Paid Per Share | Approx. Dollar Value Remaining in Program (thousands) | | :--- | :--- | :--- | :--- | | Jan 2025 | — | $— | $200,000 | | Feb 2025 | — | $— | $200,000 | | Mar 2025 | 920 | $49.40 | $154,548 | | Total | 920 | | | - The Board of Directors authorized a repurchase program of up to $200 million on November 17, 2024, set to expire at the end of Q1 2027311 Item 5. Other Information Chief Accounting Officer Michelle Stalick terminated a Rule 10b5-1 trading arrangement on March 14, 2025 - On March 14, 2025, Chief Accounting Officer Michelle Stalick terminated a Rule 10b5-1 trading arrangement established on June 14, 2024312 Item 6. Exhibits The Exhibit Index lists all documents filed with the Form 10-Q, including management certifications and compensatory plans - The Exhibit Index lists all documents filed with or incorporated by reference into the Form 10-Q, including management certifications and compensatory plans313315