Executive Summary

Q1 2025 delivered modest top-line growth with stronger profitability: revenue $166.9M (+6% y/y), GAAP operating margin 2.1% (vs. 1.1%), and non-GAAP operating margin 20.9% (vs. 17.0%) . Non-GAAP diluted EPS was $0.49 vs. S&P Global consensus of ~$0.38, a significant beat; revenue was slightly above consensus ($166.9M vs. ~$166.7M)* .
Management raised FY 2025 non-GAAP operating margin and non-GAAP EPS guidance and widened the revenue range lower, citing prudence on macro, while Q2 guidance calls for revenue of $170–$172M and non-GAAP margin of 20.5–21.5% .
Execution highlights: bookings exceeded expectations; billings +9% y/y; RPO +11% y/y; ARR $656M (+8%); revenue renewal rate 94%; NRR 104%; 79 customers with >$1M ARR (up from 71 in Q4) .
Strategic catalysts: accelerated Studio360 adoption, AI/agentic capabilities rollout, expanded SAP SolEx alignment (first-ever inclusion in a bundled SAP SKU), and early momentum in public sector; margin outperformance aided by workforce actions and FX benefits .

What Went Well and What Went Wrong

What Went Well

Bookings and expansion: “bookings exceeded expectations,” average deal size increased, and >$1M ARR customers rose to 79, evidencing deepening enterprise relationships .
Profitability: non-GAAP operating margin reached 21% (above guide), supported by cost actions in March and ~1pt FX tailwind; free cash flow margin was ~20% .
Strategic progress: Studio360 adoption and pricing model momentum; SAP SolEx partnership above expectations with larger expansion deals; SAP-related revenue ~26% of total . Quote: “We continue to position ourselves as the autonomous finance platform for the office of the CFO” .

What Went Wrong

Services mix headwind: higher-than-expected partner services mix drove services revenue slightly below internal expectations despite 6% y/y growth .
Macro caution: management widened revenue guidance to reflect potential buyer caution and elongated cycles even as pipeline remained strong .
Renewal dynamics: overall revenue renewal rate was 94% (down slightly q/q), with some enterprise customers reducing entities/users due to reorganizations; user count down reflects migration to platform pricing .

Financial Results

Revenue and EPS vs prior periods and estimates

Metric	Q1 2024	Q4 2024	Q1 2025	Consensus (Q1 2025)
Revenue ($USD Millions)	$157.5	$169.5	$166.9	$166.7*
GAAP Diluted EPS ($)	$0.17	$0.79	$0.10	n/a
Non-GAAP Diluted EPS ($)	$0.54	$0.47	$0.49	$0.38*

Values marked with * are from S&P Global consensus. Values retrieved from S&P Global.

Interpretation: Q1 revenue was a slight beat vs. consensus; non-GAAP EPS was a clear beat. Sequentially, revenue declined vs. Q4 seasonally, while non-GAAP EPS rose q/q. Prior quarter (Q4 2024) showed a revenue beat but EPS miss vs. consensus* . Values retrieved from S&P Global.

Margins

Metric	Q1 2024	Q4 2024	Q1 2025
GAAP Operating Margin %	1.1%	3.7%	2.1%
Non-GAAP Operating Margin %	17.0%	18.1%	20.9%
Non-GAAP Gross Margin %	79.0%	79.6%	79.6%
Non-GAAP Net Income Margin %	26%	20%	22%

Drivers: Margin expansion reflects cost benefits from workforce actions and FX, while continued investments (FedRAMP, India dev center) modestly pressured FCF margin .

Revenue Mix and Operating Line Items

Metric ($USD Millions)	Q1 2024	Q4 2024	Q1 2025
Subscription & Support Revenue	$149.5	$161.0	$158.5
Professional Services Revenue	$8.0	$8.5	$8.5
Total Operating Expenses (GAAP)	$116.6	$121.8	$122.4
Sales & Marketing (GAAP)	$61.1	$64.8	$63.1
R&D (GAAP)	$25.0	$24.6	$25.7
G&A (GAAP)	$30.0	$32.5	$28.3
Restructuring Costs (GAAP)	$0.44	$(0.01)	$5.30

KPIs and Cash Flow

KPI / Cash Flow	Q3 2024	Q4 2024	Q1 2025
Customers (count)	4,433	4,443	4,455
Users (count)	n/a	397,477	393,892
NRR (%)	105%	102%	104%
ARR ($USD Millions)	$638	$641	$656
RPO ($USD Millions)	n/a	n/a	$913.2
Billings ($USD Millions)	n/a	n/a	$159.0
Revenue Renewal Rate (%)	92%	96%	94%
Operating Cash Flow ($USD Millions)	$56	$43.8	$46.7
Free Cash Flow ($USD Millions)	$49	$36.5	$32.6
SAP % of Revenue	n/a	26%	26%

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue ($USD Millions)	Q2 2025	n/a	$170–$172	New
Non-GAAP Operating Margin (%)	Q2 2025	n/a	20.5–21.5	New
Non-GAAP Net Income ($USD Millions)	Q2 2025	n/a	$38–$40; $0.51–$0.53/share	New
Revenue ($USD Millions)	FY 2025	$699–$705	$692–$705	Lowered (range widened down)
Non-GAAP Operating Margin (%)	FY 2025	21.0–22.0	21.5–22.5	Raised
Non-GAAP Net Income ($USD Millions)	FY 2025	$155–$165; $1.97–$2.10/share	$159–$167; $2.12–$2.22/share	Raised

Context: Management adopted a more “prudent” revenue view due to possible buyer caution and elongated cycles, while raising margin/earnings outlook given Q1 over-delivery and cost discipline .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 2024 and Q4 2024)	Current Period (Q1 2025)	Trend
AI/Agentic Initiatives	Launched predictive guidance and payment prediction; internal AI tool adoption and productivity gains	Expanded agentic AI (insight, summarization, conversational; matching agents H2); “autonomous finance” positioning; 60 FTE equivalents saved internally since 2024	Accelerating innovation and commercialization
Studio360 Platform	Early adoption; pricing/packaging studies; strong interest ahead of Investor Day	Multiple customer wins; Snowflake partnership/data-sharing; visualization/orchestration connectors; Workday connector later 2025	Adoption building; ecosystem expanding
SAP SolEx Partnership	Reset/realignment; inclusion in SAP packages; focus on “finance-first” before ERP migration	Above expectations in Q1; bundled SKU inclusion; 26% of revenue; pipeline robust	Strengthening; attach earlier in migrations
Pricing Model (platform/unlimited)	Rollout planned over years; accretive medium term	Adoption slightly ahead of plan; reduces user-based attrition; targeting upper mid-market/enterprise	Early traction; supportive of NRR uplift path
Public Sector/FedRAMP	Investment and readiness; low 2025 revenue baked in; partner-led motion	Solid pipeline across federal/state/local; 2025 impact nominal; setting up for 2026	Building; revenue more medium-term
Macro/Tariffs/Trade	Demand measured; FX headwinds; deal velocity pushouts into 2025	Revenue guide prudence (6–8% growth scenarios); pipeline stable; watch for July policy shifts	Cautious stance; pipeline/marketing robust

Management Commentary

“We continue to position ourselves as the autonomous finance platform for the office of the CFO” .
“Our new pricing model is tracking slightly ahead of our expectations… We never have to have the seat license conversation again” .
“Solex performance was above expectations… SAP as a percentage total revenue was 26%” .
“We estimate that [responsible AI] has saved more than 60 FTE equivalents since we began using AI internally in 2024” .
“We have achieved an important solution alignment… prepackaged bundling of both SAP authored solutions and BlackLine authored solutions into a single SAP SKU” .
“Our customers need solutions that work immediately… we have made significant progress in accelerating our implementation timelines… go-live volume increased by 20% y/y” .

Q&A Highlights

Pricing model adoption: Users metric declines when clients move to platform pricing; rollout slightly ahead of plan; focus on upper mid-market and enterprise; supports long-run 1–2 pts growth uplift .
Margin confidence: Q1 margin beat largely organic; investments continue; can flex margin lever if macro worsens .
Renewal/NRR trajectory: Overall renewal rate 94% (up y/y, slightly down q/q); enterprise upper-90s; path from NRR 104% toward 109% over 3–5 years .
SAP partnership: Pipeline strengthening; earlier attach pre-ERP migrations through bundled SKUs; front-line momentum; SAP ~26% of revenue .
Public sector: Partner-led motion across state/local; minimal 2025 plan impact; building for future contribution .

Estimates Context

Q1 2025: Non-GAAP EPS $0.49 vs. consensus ~$0.38 (beat); revenue $166.9M vs. ~$166.7M (beat)* . Values retrieved from S&P Global.
Q4 2024: Revenue beat ($169.5M vs. ~$168.4M), EPS miss ($0.47 vs. ~$0.50)* . Values retrieved from S&P Global.
FY 2025: Consensus revenue ~$700.3M; company guide $692–$705M (in line). Consensus EPS ~$2.08; company raised to $2.12–$2.22 (above)* . Values retrieved from S&P Global.
Implication: Street likely revises FY EPS up to the guided range; revenue estimates may widen given prudence on macro.

Key Takeaways for Investors

Margin story improving: Q1 non-GAAP operating margin at 20.9% and FY margin guide raised to 21.5–22.5% despite ongoing growth investments; cost actions/FX helped near-term, but process discipline appears durable .
Growth trajectory tempered by prudence: Widened FY revenue range (lowered lower bound) acknowledges buyer caution/elongated cycles even as pipeline metrics and marketing engagement strengthen .
Strategic leverage via SAP and platform pricing: Earlier attach with SAP (bundled SKU) and unlimited platform pricing should reduce attrition, improve expansion, and support multi-year renewals (RPO/ARR) .
Product/AI differentiation: Expanded agentic AI and Studio360 orchestration/visualization with Snowflake/Workday integrations provide competitive edge and time-to-value that resonates with CFOs .
Near-term trading lens: EPS/margin beats and raised FY margin/EPS guidance are positives; revenue prudence and services mix headwind are watch items. Monitor Q2 execution vs. guide and any macro/tariff news flow .
Mid-term thesis: Enterprise focus, platform pricing, partner-led go-to-market, and AI-enabled workflows should gradually lift NRR toward 109% target over 3–5 years, supporting ARR growth and operating leverage .

Additional Source Documents read in full:

Q1 2025 8-K 2.02 and press release
Q1 2025 earnings call transcript – –
May 8, 2025 AI capabilities press release –
Q4 2024 8-K and call for trend analysis – –
Q3 2024 call for trajectory –

BLACKLINE, INC. (BL)·Q1 2025 Earnings Summary