BlackLine Lifts Third-Quarter Outlook After a Noisier Quarter

The Tip Desk · August 4, 2026 · 3 min read

Remaining performance obligation reached $1.1 billion as the company guided third-quarter GAAP revenue to $193 million to $195 million.

BlackLine, Inc. (BL), the financial close and agentic operations software company, reported second-quarter GAAP revenue of $187.8 million, up 9.2% from a year earlier, a slower year-over-year pace than the 9.7% increase recorded in the first quarter.

Billings were $193.0 million, up 5.9% from the year-ago second quarter, after 9.2% growth in the first quarter. Remaining performance obligation was $1.1 billion, up 16.8% from a year earlier, after 17.9% growth in the first quarter.

Chief Executive Owen Ryan said deal timing was noisy as customers worked through more rigorous, AI-driven evaluations, and that the company was more confident than ever in growing momentum. He said usage of Verity agents is monetizing on two fronts, driving conversion to the platform and starting to generate direct revenue from Verity agentic offerings.

GAAP operating margin expanded to 5.9% from 4.4% a year earlier, after 3.4% in the first quarter. Non-GAAP operating margin was 23.3%, compared with 22.1% a year earlier, after 21.6% in the first quarter. GAAP net income attributable to BlackLine was $16.5 million, or $0.27 a share, versus $8.3 million, or $0.13 a share, a year earlier. Non-GAAP net income attributable to BlackLine was $42.9 million, or $0.61 a share, versus $37.9 million, or $0.51 a share, a year earlier.

Subscription and support revenue was $177.9 million and professional services revenue was $10.0 million. Gross profit was $142.7 million. Sales and marketing expense was $68.5 million, research and development expense was $31.3 million, and general and administrative expense was $30.8 million.

Operating cash flow was $45.0 million, compared with $32.3 million a year earlier. Free cash flow was $36.5 million, compared with $25.4 million a year earlier. Cash and cash equivalents were $242.9 million and marketable securities were $284.9 million at June 30, 2026.

Customer count was 4,260 at June 30, 2026, down from 4,301 at March 31. Dollar-based net revenue retention was 102% at June 30, down from 105% at March 31. Platform pricing annual recurring revenue as a percentage of eligible ARR, which excludes SolEx and public sector ARR, rose to 17% at June 30 from 13% at March 31.

The company announced a $100 million increase to its stock buyback program. It repurchased approximately 1.2 million shares for $37.7 million in the quarter; about $179.7 million of buyback capacity remained at June 30, 2026.

Verity Prepare, BlackLine’s agentic reconciliations agent, achieved general availability in July. The company announced an expansion of its Agentic Financial Operations Platform via the Finance Control Console.

For the third quarter of 2026, BlackLine expects total GAAP revenue of $193 million to $195 million, non-GAAP operating margin of 24.5% to 25.5%, and non-GAAP net income attributable to BlackLine of $45 million to $47 million, or $0.62 to $0.65 a share on 74.5 million diluted weighted average shares. That revenue range sits above the $186 million to $188 million outlook the company had given for the second quarter, and the non-GAAP operating margin range is above the prior 21.5% to 22.5% second-quarter outlook.

Full-year 2026 GAAP revenue guidance remained $765 million to $769 million, matching the range issued after the first quarter. Full-year non-GAAP operating margin guidance moved to 24.1% to 24.6% from 24.0% to 24.5%. Full-year non-GAAP net income guidance moved to $177 million to $182 million, or $2.47 to $2.54 a share, from $174 million to $182 million, or $2.42 to $2.53 a share.

The company said the first half of 2026 will prove to be the most consequential period in its history, with AI reshaping the Office of the CFO and platform strategy maturing as Verity adoption accelerates across the customer base.