Second Quarter 2026
Filed Aug 4, 2026Total GAAP revenues increased 9.2%, operating margins expanded, and BlackLine issued third-quarter and full-year 2026 guidance.
Revenue, GAAP and non-GAAP profitability, operating cash flow, free cash flow, remaining performance obligation, and retention all increased year over year. Billings growth of 5.9% trailed revenue growth of 9.2%, while management cited noisy deal timing amid more rigorous AI-driven evaluations.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total GAAP revenuesGAAP | $187.8 million | – | an increase of 9.2% |
| GAAP operating marginGAAP | 5.9% | – | – |
| Non-GAAP operating marginnon-GAAP | 23.3% | – | – |
| GAAP net income attributable to BlackLineGAAP | $16.5 million | – | – |
| GAAP net income attributable to BlackLine per diluted shareGAAP | $0.27 per diluted share | – | – |
| Non-GAAP net income attributable to BlackLinenon-GAAP | $42.9 million | – | – |
| Non-GAAP net income attributable to BlackLine per diluted sharenon-GAAP | $0.61 per diluted share | – | – |
| Billingsother | $193.0 million | – | an increase of 5.9% |
| Remaining performance obligationother | $1.1 billion | – | an increase of 16.8% |
| Operating cash flowother | $45.0 million | – | – |
| Free cash flowother | $36.5 million | – | – |
| Total customersother | 4,260 customers | – | – |
| Platform pricing Annual Recurring Revenue as a percentage of eligible ARRother | 17% | – | – |
| Dollar-based net revenue retention rateother | 102% | – | – |
Third Quarter 2026; Full Year 2026 outlook
- Revenue$193 million to $195 million; $765 million to $769 million
- NoteNon-GAAP operating margin: 24.5% to 25.5%; 24.1% to 24.6%
- NoteNon-GAAP net income attributable to BlackLine: $45 million to $47 million; $177 million to $182 million
- NoteNon-GAAP net income per share attributable to BlackLine: $0.62 to $0.65 per share on 74.5 million diluted weighted average shares outstanding; $2.47 to $2.54 per share on 74.0 million diluted weighted average shares outstanding
Capital returns
- Repurchased approximately 1.2 million shares of common stock for $37.7 million as part of the share repurchase program.
- Approximately $179.7 million of buyback capacity remained at June 30, 2026.
- Announced a $100 million increase to the Company’s stock buyback program.
What drove it
- Platform pricing Annual Recurring Revenue as a percentage of eligible ARR, which excludes SolEx and public sector ARR, was 17% at June 30, 2026.
- Achieved a dollar-based net revenue retention rate of 102% at June 30, 2026.
- Verity Prepare, BlackLine’s agentic reconciliations agent, achieved general availability in July.
- Management said adoption of Verity agents is accelerating across the customer base and is driving platform conversion and starting to generate direct revenue from Verity agentic offerings.
Concerns
- Billings increased 5.9%, compared with total GAAP revenue growth of 9.2%.
- Management said deal timing was noisy this quarter as customers work through more rigorous, AI-driven evaluations.
- The release identifies long and increasingly variable sales cycles as a risk.
What to watch
- Conversion to platform pricing and the progression of platform pricing Annual Recurring Revenue as a percentage of eligible ARR.
- Direct revenue generation from Verity agentic offerings following Verity Prepare’s general availability in July.
- Billings growth, remaining performance obligation growth, and the effect of AI-driven customer evaluations on deal timing.
- Execution against third-quarter 2026 guidance for total GAAP revenue of $193 million to $195 million and non-GAAP operating margin of 24.5% to 25.5%.
Balance sheet and cash flow
- Operating cash flow of $45.0 million, compared to $32.3 million in the second quarter of 2025.
- Free cash flow of $36.5 million, compared to $25.4 million in the second quarter of 2025.
- Remaining performance obligation of $1.1 billion, an increase of 16.8% compared to the second quarter of 2025.
Analysis
BlackLine reported total GAAP revenues of $187.8 million, an increase of 9.2% compared to the second quarter of 2025. Billings were $193.0 million, an increase of 5.9%, while remaining performance obligation reached $1.1 billion, an increase of 16.8%. The contrast between billings growth and revenue growth, alongside management’s comments on noisy deal timing, is a central indicator of near-term sales execution.
Profitability improved on both reported bases. GAAP operating margin was 5.9%, compared to 4.4%, and non-GAAP operating margin was 23.3%, compared to 22.1%. GAAP net income attributable to BlackLine was $16.5 million, or $0.27 per diluted share, compared to $8.3 million, or $0.13 per diluted share. Non-GAAP net income attributable to BlackLine was $42.9 million, or $0.61 per diluted share, compared to $37.9 million, or $0.51 per diluted share.
Cash generation also strengthened. Operating cash flow was $45.0 million compared to $32.3 million, and free cash flow was $36.5 million compared to $25.4 million. BlackLine repurchased approximately 1.2 million shares for $37.7 million, had approximately $179.7 million of buyback capacity remaining at June 30, 2026, and announced a $100 million increase to its stock buyback program.
Operational indicators point to continued adoption within the installed base, with 4,260 customers, a dollar-based net revenue retention rate of 102%, and platform pricing ARR equal to 17% of eligible ARR. Management identified accelerating Verity-agent adoption, platform conversion, and the beginning of direct revenue generation from Verity offerings as demand drivers. Verity Prepare achieved general availability in July.
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 per share on 74.5 million diluted weighted average shares outstanding. Full-year 2026 guidance calls for total GAAP revenue of $765 million to $769 million, non-GAAP operating margin of 24.1% to 24.6%, and non-GAAP net income attributable to BlackLine of $177 million to $182 million, or $2.47 to $2.54 per share on 74.0 million diluted weighted average shares outstanding.
Management, verbatim
I believe the first half of 2026 will prove to be the most consequential period in BlackLine's history. AI is reshaping the Office of the CFO, and we are meeting that moment. Our platform strategy is maturing and adoption of our Verity agents is accelerating across our base. That usage is now monetizing on two fronts, driving conversion to our platform and starting to generate direct revenue from our Verity agentic offerings.
Owen Ryan, CEO of BlackLine
The world's most sophisticated enterprises are deepening their commitments to BlackLine. Deal timing was noisy this quarter as customers work through more rigorous, AI-driven evaluations, but the demand behind those opportunities is strong and durable, and we are more confident than ever in the growing momentum across our business.
Owen Ryan, CEO of BlackLine
Not in the filing
stated, not guessed- Prior-quarter comparisons for reported financial metrics.
- Revenue by segment or product line.
- Gross profit and gross margin.
- GAAP operating income.
- Operating expenses.
- Cash and cash equivalents.
- Debt and other balance-sheet leverage metrics.
- Dividend information.
- Prior-quarter customer, platform pricing ARR, and dollar-based net revenue retention figures.
- Prior guidance, which was not provided.
- Forward GAAP operating margin, GAAP net income, and GAAP net income per share reconciliations, which the company said are not available on a forward-looking basis without unreasonable efforts.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.