BLACKLINE INC
For the period ended Jun 30, 2024. Filed Aug 7, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 7, 2024
BL$25.89-23.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-08.
0001666134-24-000013
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-07.
0001666134-24-000016
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 127 previous paragraphs and 159 current paragraphs.
61 unchanged; 54 reworded; 35 added; 7 removed; 5 previous and 9 current paragraphs rearranged.
Tables are not compared: 17 previous and 18 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (35)
Current report
For the six months ended June 30, 2024 and 2023, we had revenues totaling $318.0 million and $283.6 million, respectively. We generated net income attributable to BlackLine, Inc. of $87.5 million and $18.8 million for the six months ended June 30, 2024 and 2023, respectively.
Current report
•$0.5 million increase in salaries, benefits, and stock-based compensation.
Current report
The increase in total cost of revenues for the six months ended June 30, 2024, compared to the six months ended June 30, 2023, was primarily due to the following:
Current report
•$1.7 million decrease in marketing expenses due to streamlined marketing efforts; and
Current report
•$0.9 million decrease in salaries, benefits, and stock-based compensation due to a decrease in headcount, partially offset by an increase in average salaries, commissions, and bonuses.
Current report
The decrease in sales and marketing expenses for the six months ended June 30, 2024, compared to the six months ended June 30, 2023, was primarily due to the following:
Current report
•$1.7 million decrease in marketing expenses due to streamlined marketing efforts; partially offset by
Current report
•$0.6 million increase in sales-related events held in-person compared to virtual events in the prior year;
Current report
•$0.5 million increase in computer software expenses to support automation and scalability.
Current report
•$0.9 million decrease in transaction-related costs related to the FourQ acquisition; and
Current report
•$0.5 million increase in capitalized software costs due to a focus on cloud-based solutions and development of new solution offerings. Collectively, these increases resulted in a decrease in net expenses.
Current report
The decrease in research and development expenses for the six months ended June 30, 2024, compared to the six months ended June 30, 2023, was primarily due to the following:
Current report
•$1.2 million decrease in transaction-related costs related to the FourQ acquisition; and
Current report
•$0.3 million increase in capitalized software costs due to enhanced functionality of our solutions and development of new solution offerings. Collectively, these increases resulted in a decrease in net expenses; partially offset by
Current report
•$6.0 million increase in salaries, benefits, and stock-based compensation primarily related to an increase in average headcount and average salaries that includes strategic initiatives to support long-term growth; partially offset by
Current report
•$0.4 million decrease in costs related to internal strategic projects.
Current report
The increase in general and administrative expenses for the six months ended June 30, 2024, compared to the six months ended June 30, 2023, was primarily due to the following:
Current report
•$0.4 million increase in computer software expenses to support automation and scalability; partially offset by
Current report
•$0.6 million decrease in costs related to internal strategic projects.
Current report
The increase in interest expense during the quarter and six months ended June 30, 2024, compared to the quarter and six months ended June 30, 2023, was primarily due to the amortization of debt issuance costs and cash interest expense related to our 2029 Notes issued in May 2024, partially offset by a decrease in interest expense resulting from the partial repurchase of our 2026 Notes. Refer to “Note 7 - Convertible Senior Notes” for additional information.
Current report
Gain on extinguishment of convertible senior notes
Current report
The gain on extinguishment of convertible senior notes during the quarter and six months ended June 30, 2024 resulted from the partial repurchase of our 2026 Notes. Refer to “Note 7 - Convertible Senior Notes” for additional information.
Current report
Convertible senior notes and capped calls
Current report
In connection with the offering of the 2029 Notes, we entered into the 2029 Capped Calls with certain counterparties covering, subject to anti-dilution adjustments, approximately 9.9 million shares of our common stock and are generally expected to offset the potential economic dilution of our common stock up to the initial cap price. The 2029 Capped Calls have an initial strike price of $68.47 per share subject to certain adjustments, which corresponds to the initial conversion price of the 2029 Notes and an initial cap price of $92.17 per share, subject to certain adjustments. As of June 30, 2024, all of the 2029 Capped Calls remained outstanding.
Current report
•$3.5 million net decrease in prepaid expenses and other current assets primarily due to a decrease in accrued interest, amortization of prepaid balances, and lower capitalized commissions; and
Current report
•$1.0 million increase in deferred revenue.
Current report
Net Cash Provided By (Used In) Investing Activities
Current report
For the six months ended June 30, 2024, cash provided by investing activities was $506.4 million primarily as a result of the following:
Current report
Net Cash Provided By (Used In) Financing Activities
Current report
•$848.5 million for the partial repurchase of the 2026 Notes;
Current report
•$59.7 million for the purchase of the associated Capped Calls for the 2029 Notes; and
Current report
•$662.6 million of proceeds, net of debt issuance costs, from the issuance of the 2029 Notes;
Current report
•$4.2 million of proceeds from the employee stock purchase plan; and
Current report
For the six months ended June 30, 2023, cash provided by financing activities was $3.3 million primarily as a result of the following:
Current report
•$5.3 million proceeds from the employee stock purchase plan; partially offset by
Removed paragraphs (7)
Previous report
•$0.6 million increase in employee events; and
Previous report
•$0.3 million decrease in transaction costs; partially offset by
Previous report
Interest expense during the quarter ended March 31, 2024, compared to the quarter ended March 31, 2023, was essentially flat and consisted of interest expense on our convertible senior notes.
Previous report
Notes Payable
Previous report
•$2.0 million net increase in prepaid expenses and other current assets related to insurance and software subscriptions; and
Previous report
For the quarter ended March 31, 2024, cash provided by investing activities was $21.0 million primarily as a result of the following:
Previous report
Net Cash Used In Financing Activities
Reworded paragraphs (54)
Previous wording
At March 31, 2024, we had 387,050 individual users across 4,411 customers. Additionally, we continue to build strategic relationships with technology vendors, professional services firms, business process outsourcers, and resellers.
Current wording
At June 30, 2024, we had 396,366 individual users across 4,435 customers. Additionally, we continue to build strategic relationships with technology vendors, professional services firms, business process outsourcers, and resellers.
Previous wording
We derived approximately 95% of our revenue from subscriptions to our cloud-based software platform and approximately 5% from professional services for the quarter ended March 31, 2024. Our subscription contracts have initial non-cancellable terms of one year to three years with renewal options. The majority of new contracts in 2023 and during the quarter ended March 31, 2024 had an initial term of three years. We price our subscriptions based on a number of factors, primarily the number of users having access to the products and the number of products purchased by the customer. We typically invoice customers annually in advance for subscriptions, which is initially recorded as deferred revenue and recognized ratably over the term of the customer contract. The first year of subscription fees are typically payable within 30 days after execution of a contract, and thereafter upon renewal.
Current wording
We derived approximately 95% of our revenue from subscriptions to our cloud-based software platform and approximately 5% from professional services for the six months ended June 30, 2024. Our subscription contracts have initial non-cancellable terms of one year to three years with renewal options. The majority of new contracts in 2023 and during the six months ended June 30, 2024 had an initial term of three years. We price our subscriptions based on a number of factors, primarily the number of users having access to the products and the number of products purchased by the customer. We typically invoice customers annually in advance for subscriptions, which is initially recorded as deferred revenue and recognized ratably over the term of the customer contract. The first year of subscription fees are typically payable within 30 days after execution of a contract, and thereafter upon renewal.
Previous wording
For the quarters ended March 31, 2024 and 2023, we had revenues totaling $157.5 million and $139.0 million, respectively. We generated net income attributable to BlackLine, Inc. of $10.8 million and incurred a net loss attributable to BlackLine, Inc. of $12.0 million for the quarters ended March 31, 2024 and 2023, respectively.
Current wording
For the quarters ended June 30, 2024 and 2023, we had revenues totaling $160.5 million and $144.6 million, respectively. We generated net income attributable to BlackLine, Inc. of $76.7 million and $30.8 million for the quarters ended June 30, 2024 and 2023, respectively.
Previous wording
Our operating results may vary based on the impact of changes in our industry or the global economy on us or our customers. General macroeconomic conditions, such as a recession or rising inflation rates, an economic downturn in the United States (“U.S.”) or internationally, adverse business conditions and liquidity concerns, or bank failures or instability in the financial services sector, has and could continue to adversely affect demand for our products and make it difficult to accurately forecast and plan our future business activities. In recent quarters, as a result of economic uncertainty, we have seen customers delay and defer purchasing decisions, which has adversely impacted our near-term demand.
Current wording
Our operating results may vary based on the impact of changes in our industry or the global economy on us or our customers. General macroeconomic conditions, such as a recession, inflation or rising interest rates, an economic downturn in the United States (“U.S.”) or internationally, adverse business conditions and liquidity concerns, or bank failures or instability in the financial services sector, has and could continue to adversely affect demand for our products and make it difficult to accurately forecast and plan our future business activities. In recent quarters, as a result of economic uncertainty, we have seen customers delay and defer purchasing decisions, which has adversely impacted our near-term demand.
Previous wording
Dollar-based net revenue retention rate. We believe that dollar-based net revenue retention rate is an important metric to measure the long-term value of customer agreements and our ability to retain and grow our relationships with existing customers over time. We calculate dollar-based net revenue retention rate as the implied monthly subscription and support revenue at the end of a period for the base set of customers from which we 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. We define implied monthly subscription and support revenue as the total amount of minimum subscription and support revenue contractually committed to, under each of our customer agreements over the entire term of the agreement, divided by the number of months in the term of the agreement. At March 31, 2024, our dollar-based net revenue retention rate marginally declined from the year ended December 31, 2023. Our ability to maximize the lifetime value of our customer relationships will depend, in part, on the willingness of the customer to purchase additional user licenses and products from us. We rely on our customer success and sales teams to support and grow our existing customers by maintaining high customer satisfaction and educating the customer on the value all our products provide.
Current wording
Dollar-based net revenue retention rate. We believe that dollar-based net revenue retention rate is an important metric to measure the long-term value of customer agreements and our ability to retain and grow our relationships with existing customers over time. We calculate dollar-based net revenue retention rate as the implied monthly subscription and support revenue at the end of a period for the base set of customers from which we 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. We define implied monthly subscription and support revenue as the total amount of minimum subscription and support revenue contractually committed to, under each of our customer agreements over the entire term of the agreement, divided by the number of months in the term of the agreement. At June 30, 2024, our dollar-based net revenue retention rate marginally declined from the quarter ended March 31, 2024 due to attrition. Our ability to maximize the lifetime value of our customer relationships will depend, in part, on the willingness of the customer to purchase additional user licenses and products from us. We rely on our customer success and sales teams to support and grow our existing customers by maintaining high customer satisfaction and educating the customer on the value all our products provide.
Previous wording
Number of customers. We believe that our ability to expand our customer base is an indicator of our market penetration and the growth of our business. We define a customer 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. However, 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. For the quarters ended March 31, 2024 and 2023, no single customer accounted for more than 10% of our total revenues.
Current wording
Number of customers. We believe that our ability to expand our customer base is an indicator of our market penetration and the growth of our business. We define a customer 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. However, 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. For the quarters and six months ended June 30, 2024 and 2023, no single customer accounted for more than 10% of our total revenues.
Previous wording
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, 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. We believe 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.
Current wording
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. We believe 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.
Previous wording
Non-GAAP Income (Loss) from Operations and Non-GAAP Operating Margin. Non-GAAP income (loss) from operations is defined as GAAP income (loss) 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. We believe that presenting non-GAAP income (loss) from operations and non-GAAP operating margin is useful to investors as it eliminates the impact of items that have been impacted by
Current wording
Non-GAAP Income (Loss) from Operations and Non-GAAP Operating Margin. Non-GAAP income (loss) from operations is defined as GAAP income (loss) 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. We believe that presenting non-GAAP income (loss) from operations and non-GAAP operating margin is useful to investors as it eliminates the impact of items that have been impacted by BlackLine’s acquisitions and other related costs in order to allow a direct comparison of income (loss) from operations between all periods presented.
Previous wording
Non-GAAP Net Income (Loss) Attributable to BlackLine and Diluted Non-GAAP Net Income (Loss) Per Share Attributable to BlackLine, Inc. Non-GAAP net income (loss) attributable to BlackLine is defined as GAAP net income (loss) attributable to BlackLine adjusted for the impact of the provision for (benefit from) income taxes related to acquisitions, amortization of intangible assets, stock-based compensation, amortization of debt issuance costs from our 0.125% Convertible Senior Notes due in 2024 (the “2024 Notes”) and 0.00% Convertible Senior Notes due in 2026 (the “2026 Notes” and, together with the 2024 Notes, the “Notes” or “convertible senior notes”), change in fair value of contingent consideration, transaction-related costs, legal settlement gains or costs, restructuring costs, and the adjustment to the redeemable non-controlling interest to the redemption amount. Diluted non-GAAP net income per share attributable to BlackLine, Inc. includes the adjustment for shares resulting from the elimination of stock-based compensation. We believe that presenting non-GAAP net income (loss) attributable to BlackLine is useful to investors as it eliminates the impact of items that have been impacted by our acquisitions and other related costs to allow a direct comparison of net income (loss) between all periods presented.
Current wording
Non-GAAP Net Income (Loss) Attributable to BlackLine and Diluted Non-GAAP Net Income (Loss) Per Share Attributable to BlackLine, Inc. Non-GAAP net income (loss) attributable to BlackLine is defined as GAAP net income (loss) attributable to BlackLine adjusted for the impact of the provision for (benefit from) income taxes related to acquisitions, amortization of intangible assets, stock-based compensation, amortization of debt issuance costs from our 0.125% Convertible Senior Notes due in 2024 (the “2024 Notes”), 0.00% Convertible Senior Notes due in 2026 (the “2026 Notes”), and 1.00% Convertible Senior Notes due in 2029 (the “2029 Notes” and, together with the 2024 and 2026 Notes, the “Notes” or “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 (loss) per share attributable to BlackLine, Inc. includes the adjustment for shares resulting from the elimination of stock-based compensation. We believe that presenting non-GAAP net income (loss) attributable to BlackLine is useful to investors as it eliminates the impact of items that have been impacted by our acquisitions and other related costs to allow a direct comparison of net income (loss) between all periods presented.
Previous wording
The following table presents a reconciliation of gross profit, gross margin, operating income (loss), operating margin, and net income (loss), the most comparable GAAP measures, to non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income, non-GAAP operating margin, and non-GAAP net income:
Current wording
The following table presents a reconciliation of gross profit, gross margin, operating income, operating margin, and net income, the most comparable GAAP measures, to non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income, non-GAAP operating margin, and non-GAAP net income:
Previous wording
Comparison of Quarters Ended March 31, 2024 and 2023
Current wording
Comparison of Quarters and Six Months Ended June 30, 2024 and 2023
Previous wording
The increase in revenues for the quarter ended March 31, 2024, compared to the quarter ended March 31, 2023, was primarily due to a net increase in the number of customers and users. The total number of customers and users at March 31, 2024, increased by 4% and 5%, respectively, as compared to March 31, 2023.
Current wording
The increase in revenues for the quarter and six months ended June 30, 2024, compared to the quarter and six months ended June 30, 2023, was primarily from acquiring new customers, while existing customers grew from additional users and product expansion. The total number of customers and users at June 30, 2024, increased by 4% and 5%, respectively, as compared to June 30, 2023.
Previous wording
•$2.9 million increase in computer software and data center expenses due to higher spend on cloud hosting services as customers continue to migrate to the Google Cloud Platform, as well as an increase in software purchases; and
Current wording
•$4.9 million increase in computer software expenses due to higher spend on cloud hosting services as customers continue to migrate to the Google Cloud Platform, as well as an increase in software purchases; and
Previous wording
•$1.0 million increase in amortization of developed technology due to net additions to software placed into service; partially offset by
Current wording
•$1.8 million increase in amortization of developed technology due to net additions to software placed into service.
Previous wording
•$3.2 million decrease in salaries, benefits, and stock-based compensation driven primarily by a decrease in headcount; partially offset by
Current wording
•$4.1 million decrease in salaries, benefits, and stock-based compensation driven primarily by a decrease in headcount; and
Previous wording
•$0.6 million increase in travel and entertainment to support in-person events.
Current wording
•$0.5 million increase in travel and entertainment to support in-person events; and
Previous wording
•$2.1 million decrease in salaries, benefits, and stock-based compensation driven primarily by a decrease in average salaries, partially offset by an increase in headcount; and
Current wording
•$2.0 million decrease in salaries, benefits, and stock-based compensation driven primarily by a decrease in average salaries from an increase in offshore headcount;
Previous wording
•$0.3 million increase in computer software to support business growth.
Current wording
•$0.5 million increase in computer software expenses to support business growth.
Previous wording
•$3.1 million decrease in the fair value of FourQ contingent consideration that occurred in the quarter ended March 31, 2023 (refer to “Note 6 - Fair Value Measurements”); and
Current wording
•$25.5 million increase in the period due to the decrease in the fair value of FourQ contingent consideration that occurred in the quarter ended June 30, 2023 (refer to “Note 6 - Fair Value Measurements”);
Previous wording
•$0.4 million decrease in depreciation and amortization primarily due to certain intangible assets being fully amortized.
Current wording
•$0.5 million decrease in depreciation and amortization primarily due to certain intangible assets being fully amortized; and
Previous wording
•$1.8 million increase in salaries, benefits, and stock-based compensation primarily due to an increase in average headcount and average salaries;
Current wording
•$7.8 million increase in salaries, benefits, and stock-based compensation primarily related to an increase in average headcount and average salaries that includes strategic initiatives to support long-term growth;
Previous wording
•$1.8 million increase due to net foreign currency losses due to the strengthening of the U.S. Dollar across multiple currencies; and
Current wording
•$1.9 million increase due to net foreign currency losses due to the strengthening of the U.S. Dollar across multiple currencies;
Previous wording
•$0.6 million increase in professional fees; partially offset by
Current wording
•$0.8 million increase in professional fees; and
Previous wording
The decrease in restructuring costs during the quarter ended March 31, 2024, compared to the quarter ended March 31, 2023, was due to lower additional one-time termination benefits for the fiscal 2023 restructuring program compared to higher additional one-time termination benefits for the fiscal 2022 restructuring program in the respective periods. Refer to “Note 8 - Restructuring Costs” for additional information.
Current wording
The increase in restructuring costs during the quarter ended June 30, 2024, compared to the quarter ended June 30, 2023, was due to additional one-time termination benefits for the fiscal 2023 restructuring program compared to lower additional one-time termination benefits for the fiscal 2022 restructuring program in the respective period. Refer to “Note 8 - Restructuring Costs” for additional information.
Previous wording
The increase in interest income during the quarter ended March 31, 2024, compared to the quarter ended March 31, 2023, was due to increased average interest rates on our investments and cash balances and, to a lesser extent, an increase in average balances.
Current wording
The increase in interest income during the quarter and six months ended June 30, 2024, compared to the quarter and six months ended June 30, 2023, was due to increased average interest rates on our investments and cash balances and, to a lesser extent, an increase in average balances.
Previous wording
For the quarters ended March 31, 2024 and 2023, we recorded $0.9 million and $0.6 million in income tax expense, respectively. The increase in income tax expense for the quarter ended March 31, 2024, compared to the income tax expense for the quarter ended March 31, 2023 resulted primarily from an increase in U.S. profitability, along with changes in the mix of profitable foreign jurisdictions.
Current wording
For the quarters ended June 30, 2024 and 2023, we recorded $4.3 million and $0.9 million in income tax expense, respectively. For the six months ended June 30, 2024 and 2023, we recorded $5.2 million and $1.6 million in income tax expense, respectively. The increase in income tax expense for both the quarter and six months ended June 30, 2024 compared to the quarter and six months ended June 30, 2023, resulted primarily from a $3.0 million tax expense associated with the gain on the partial extinguishment of the 2026 Notes, along with changes in the mix of profitable foreign jurisdictions.
Previous wording
At March 31, 2024, our principal sources of liquidity were an aggregate of $1.2 billion of cash and cash equivalents and marketable securities, which primarily consist of short-term, money market mutual funds, commercial paper, U.S. treasury securities, corporate bonds, and U.S. government agencies. We had $1.4 billion aggregate principal amount of Notes outstanding at March 31, 2024, of which $250.0 million is due within the next 12 months. We plan to and believe we are able to make all expected principal and interest payments in the next 12 months.
Current wording
At June 30, 2024, our principal sources of liquidity were an aggregate of $1.0 billion of cash and cash equivalents and marketable securities, which primarily consist of short-term, money market mutual funds, commercial paper, U.S. treasury securities, and U.S. government agencies.
Previous wording
In connection with the offering of the 2024 Notes, we entered into the 2024 Capped Calls with certain counterparties covering, subject to anti-dilution adjustments, approximately 3.4 million shares of our common stock and are generally expected to offset the potential economic dilution of our common stock up to the initial cap price. The 2024 Capped Calls have an initial strike price of $73.40 per share - subject to certain adjustments, which corresponds to the initial conversion price of the 2024 Notes - and an initial cap price of $106.76 per share, subject to certain adjustments. As of March 31, 2024, all of the 2024 Capped Calls remained outstanding.
Current wording
In connection with the offering of the 2024 Notes, we entered into the 2024 Capped Calls with certain counterparties covering, subject to anti-dilution adjustments, approximately 3.4 million shares of our common stock and are generally expected to offset the potential economic dilution of our common stock up to the initial cap price. The 2024 Capped Calls have an initial strike price of $73.40 per share subject to certain adjustments, which corresponds to the initial conversion price of the 2024 Notes - and an initial cap price of $106.76 per share, subject to certain adjustments. As of June 30, 2024, all of the 2024 Capped Calls remained outstanding. The 2024 Capped Calls expired on August 1, 2024.
Previous wording
As of March 31, 2024, we have obligations totaling $20.1 million related to existing property and equipment leases.
Current wording
As of June 30, 2024, we have obligations totaling $18.9 million related to existing property and equipment leases.
Previous wording
Purchase obligations represent our most significant contractual obligations in the ordinary course of business for which we have not received the related goods or services, in whole or in part. At March 31, 2024, we have $36.2 million of contractual obligations related to eight commitments, with $17.1 million payable within 12 months, and have additional contractual obligations with other vendors that are individually immaterial and which we can readily settle given our liquidity position and capital resources.
Current wording
Purchase obligations represent our most significant contractual obligations in the ordinary course of business for which we have not received the related goods or services, in whole or in part. At June 30, 2024, we have $41.1 million of contractual obligations related to seven commitments, with $22.5 million payable within 12 months, and have additional contractual obligations with other vendors that are individually immaterial and which we can readily settle given our liquidity position and capital resources.
Previous wording
As of March 31, 2024, while we have liabilities for unrecognized tax benefits of $7.6 million, due to their nature, there is a high degree of uncertainty regarding the timing of future cash outflows and other events that extinguish these liabilities.
Current wording
As of June 30, 2024, while we have liabilities for unrecognized tax benefits of $7.8 million, due to their nature, there is a high degree of uncertainty regarding the timing of future cash outflows and other events that extinguish these liabilities.
Previous wording
Our cash flows provided by operating activities are primarily influenced by our net income, as applicable, and cash generated from collections in accordance with our subscription-based revenue model wherein billings occur in advance of revenue recognition, as well as the substantial amount of non-cash charges that we incur. Non-cash activities primarily include depreciation and amortization, stock-based compensation, changes in fair value of contingent consideration, non-cash lease expense, amortization of debt issuance costs, accretion of premiums on marketable securities, and deferred taxes.
Current wording
Our cash flows provided by operating activities are primarily influenced by our net income, as applicable, and cash generated from collections in accordance with our subscription-based revenue model wherein billings occur in advance of revenue recognition, as well as the substantial amount of non-cash charges that we incur. Non-cash activities primarily include a gain on extinguishment from the partial repurchase of our 2026 Notes, depreciation and amortization, stock-based compensation, changes in fair value of contingent consideration, non-cash lease expense, amortization of debt issuance costs, accretion of premiums on marketable securities, and deferred taxes.
Previous wording
For the quarter ended March 31, 2024, cash provided by operations was $50.4 million, resulting from net non-cash expenses of approximately $24.6 million, net income of $14.8 million, and net cash flows provided as a result of changes in operating assets and liabilities of $11.0 million. The $11.0 million of net cash flows provided as a result of changes in our operating assets and liabilities reflected primarily the following:
Current wording
For the six months ended June 30, 2024, cash provided by operations was $91.1 million, resulting from net income of $89.7 million and net cash flows provided as a result of changes in operating assets and liabilities of $10.8 million, partially offset by net non-cash expenses of approximately $9.4 million. The $10.8 million of net cash flows provided as a result of changes in our operating assets and liabilities reflected primarily the following:
Previous wording
•$45.7 million decrease in accounts receivable primarily due to increased collections; and
Current wording
•$34.0 million decrease in accounts receivable primarily due to increased collections;
Previous wording
•$2.4 million decrease in other assets due to a net decrease in prepaid commissions, partially offset by an increase in cloud computing costs.
Current wording
•$1.6 million decrease in other assets due to a net decrease in prepaid commissions, partially offset by cloud computing costs.
Previous wording
•$14.8 million decrease in accrued expenses and other current liabilities primarily due to annual bonus payments;
Current wording
•$10.9 million decrease in accrued expenses and other current liabilities primarily due to annual bonus payments;
Previous wording
•$11.8 million decrease in deferred revenue due to a decrease in billings resulting from a decrease in bookings;
Current wording
•$7.8 million decrease in deferred revenue due to a decrease in billings resulting from a decrease in bookings;
Previous wording
•$9.5 million decrease in accounts payable due to timing of payments;
Current wording
•$6.5 million decrease in accounts payable due to timing of payments; and
Previous wording
•$1.7 million decrease in operating lease liabilities.
Current wording
•$3.2 million decrease in operating lease liabilities.
Previous wording
For the quarter ended March 31, 2023, cash provided by operations was $22.9 million, resulting from net non-cash expenses of approximately $31.2 million, less net cash flows used as a result from changes in operating assets and liabilities of $1.6 million, partially offset by our net loss of $6.7 million. The $1.6 million of net cash flows used as a result of changes in our operating assets and liabilities reflected primarily the following:
Current wording
For the six months ended June 30, 2023, cash provided by operations was $47.4 million, resulting from net non-cash expenses of approximately $33.3 million and net income of $21.3 million, partially offset by net cash flows used as a result from changes in operating assets and liabilities of $7.2 million. The $7.2 million of net cash flows used as a result of changes in our operating assets and liabilities reflected primarily the following:
Showing the first 40 of 54 pairs. Open the source sections for the rest.
Rearranged current paragraphs (9)
Current report — wording carried from elsewhere
•$2.0 million increase in computer software expenses due to higher spend on cloud hosting services as customers continue to migrate to the Google Cloud Platform, as well as an increase in software purchases;
Current report — wording carried from elsewhere
•$0.8 million increase in amortization of developed technology due to net additions to software placed into service; and
Current report — wording carried from elsewhere
•$22.4 million increase due to the decrease in the fair value of FourQ contingent consideration that occurred in the six months ended June 30, 2023 (refer to “Note 6 - Fair Value Measurements”);
Current report — wording carried from elsewhere
•$0.9 million decrease in depreciation and amortization primarily due to certain intangible assets being fully amortized; and
Current report — wording carried from elsewhere
The increase in restructuring costs during the six months ended June 30, 2024, compared to the six months ended June 30, 2023, was due to additional one-time termination benefits for the fiscal 2023 restructuring program compared to lower additional one-time termination benefits for the fiscal 2022 restructuring program in the respective periods. Refer to “Note 8 - Restructuring Costs” for additional information.
Current report — wording carried from elsewhere
We had $1.2 billion aggregate principal amount of Notes outstanding at June 30, 2024, of which $250.0 million was repaid on August 1, 2024. We plan to, and believe we are able to, make all expected interest payments in the next 12 months.
Current report — wording carried from elsewhere
•$2.8 million in purchases of property and equipment.
Current report — wording carried from elsewhere
•$11.9 million of proceeds from exercises of stock options; and
Current report — wording carried from elsewhere
•$13.4 million for acquisitions of common stock for tax withholding obligations.
Rearranged previous paragraphs (5)
Previous report — wording carried elsewhere
BlackLine’s acquisitions and other related costs in order to allow a direct comparison of income (loss) from operations between all periods presented.
Previous report — wording carried elsewhere
•$0.5 million decrease in salaries, benefits, and stock-based compensation.
Previous report — wording carried elsewhere
•$1.8 million decrease in deferred revenue; and
Previous report — wording carried elsewhere
Net Cash Provided By Investing Activities
Previous report — wording carried elsewhere
For the quarter ended March 31, 2024, cash used in financing activities was $10.9 million primarily for acquisitions of common stock for tax withholding obligations.