BLACKLINE, INC.

Previous wording

At September 30, 2024, we had 397,095 individual users across 4,433 customers. Additionally, we continue to build strategic relationships with technology vendors, professional services firms, business process outsourcers, and resellers.

Current wording

At March 31, 2025, we had 393,892 individual users across 4,455 customers. Additionally, we continue to build strategic relationships with technology vendors, professional services firms, business process outsourcers, and resellers.

Previous wording

Our cloud-based solutions include Account Reconciliations, Transaction Matching, Task Management, Financial Reporting Analytics, Journal Entry, Variance Analysis, Compliance, Smart Close for SAP, BlackLine Cash Application, Credit & Risk Management, Collections Management, Disputes & Deductions Management, Team & Task Management, AR Intelligence, Electronic Invoicing & Payments, Intercompany Create, Intercompany Balance and Resolve, and Intercompany Net and Settle. These solutions are offered to customers as scalable solutions that support critical record-to-report and invoice-to-cash processes.

Current wording

Our cloud-based solutions, increasingly powered by our BlackLine Studio360 Platform, include Account Reconciliations, Transaction Matching, Task Management, Financial Reporting Analytics, Journal Entry, Variance Analysis, Compliance, Smart Close for SAP, Cash Application, Credit & Risk Management, Collections Management, Disputes & Deductions Management, Team & Task Management, AR Intelligence, Electronic Invoicing & Payments, Intercompany Create, Intercompany Balance & Resolve, and Intercompany Net & Settle. These applications address many use cases across our customers’ financial operations and include comprehensive and flexible solutions that deliver best practices for end-to-end record-to-report and invoice-to-cash processes.

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 nine months ended September 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 nine months ended September 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.

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 quarter ended March 31, 2025. Our subscription contracts have initial non-cancellable terms of one year to three years with renewal options. The majority of new contracts in 2024 and during the quarter ended March 31, 2025 had an initial non-cancellable term of three years. We have updated our subscription pricing models to address the value of BlackLine solutions based on a number of factors, including customer size, the products involved in delivering our solutions, and volumetrics, such as transactions or entities. 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

Professional services consist primarily of implementation and consulting services. With the exception of our intercompany accounting solutions acquired from FourQ Systems, Inc. (“FourQ”), our product offerings are available for immediate use on our platform after granting access to a new customer. We typically help customers implement our solutions, and we also provide consulting services to help customers optimize the use of our products. We invoice customers for our consulting services on a time-and-materials basis and recognize that revenue as services are performed. A limited number of our customers are provided professional services for a fixed fee which we invoice in advance and is initially recorded as deferred revenue and recognized on a proportional-performance basis as the services are rendered.

Current wording

Professional services consist primarily of implementation and consulting services. With the exception of our intercompany accounting solutions acquired as part of our acquisition of FourQ Systems, Inc. (“FourQ”), our product offerings are available for immediate use on our platform after granting access to a new customer. We typically help customers implement our solutions, and we also provide consulting services to help customers optimize the use of our products. We invoice customers for our consulting services on a time-and-materials basis and recognize that revenue as services are performed. A limited number of our customers are provided professional services for a fixed fee, for which we invoice in advance. The fee is initially recorded as deferred revenue and recognized on a proportional-performance basis as the services are rendered.

Previous wording

The length of our sales cycle depends on the size of a potential customer and contract, as well as the type of solution or product being purchased. The sales cycle for our global enterprise customers is generally longer than that of our midsize customers. In addition, the length of the sales cycle tends to increase for larger contracts and for more complex, strategic products like Intercompany Financial Management. As we continue to focus on increasing our average contract size and selling more strategic products, we expect our sales cycle to lengthen and become less predictable, which could cause variability in our results for any particular period.

Current wording

The length of our sales cycle depends on the size of a potential customer and contract, as well as the type of solution or product being purchased. The sales cycle for our global enterprise customers is generally longer than that of our mid-size customers. In addition, the length of the sales cycle tends to increase for larger contracts and for more complex, strategic products like Intercompany Financial Management. As we continue to focus on increasing our average contract size and selling more strategic products, we expect our sales cycle to lengthen and become less predictable, which could cause variability in our results for any particular period.

Previous wording

For the quarters ended September 30, 2024 and 2023, we had revenues totaling $165.9 million and $150.7 million, respectively. We generated net income attributable to BlackLine, Inc. of $17.2 million and $11.9 million for the quarters ended September 30, 2024 and 2023, respectively.

Current wording

For the quarters ended March 31, 2025 and 2024, we had revenues totaling $166.9 million and $157.5 million, respectively. We generated net income attributable to BlackLine, Inc. of $6.1 million and $10.8 million for the quarters ended March 31, 2025 and 2024, 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, 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.

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. 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 September 30, 2024, our dollar-based net revenue retention rate marginally increased from the quarter ended June 30, 2024. 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 March 31, 2025, our dollar-based net revenue retention rate increased from the year ended December 31, 2024 due to a higher rate of acquiring customer accounts and the impact of favorable foreign exchange rates. 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 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 and nine months ended September 30, 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 ended March 31, 2025 and 2024, no single customer accounted for more than 10% of our total revenues.

Previous wording

Number of users. Since our customers generally pay fees based on the number of users of our platform within their organization, we believe the total number of users is an indicator of the growth of our business. While the fees for the majority of the products we sell are user-based, we are seeing an increasing volume of transactions for our non-user based strategic products, such as eInvoicing & Payments, Transaction Matching, Intercompany, and BlackLine Cash Application.

Current wording

Number of users. Since our customers generally pay fees based on the number of users on our platform within their organization, we believe the total number of users is an indicator of the growth of our business. While the fees for the majority of the products we sell are user-based, we anticipate that we will see a higher volume of transactions based on our updated pricing models that are based on additional factors, including customer size, product mix, and volumetrics, such as transactions or entities.

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 (loss) 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.

Current wording

Non-GAAP Income from Operations and Non-GAAP Operating Margin. Non-GAAP income from operations is defined as GAAP income 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 from operations and non-GAAP operating margin is useful to investors as it eliminates the impact of items that have been impacted by our acquisitions and other related costs in order to allow a direct comparison of income 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 paid 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.

Current wording

Non-GAAP Net Income Attributable to BlackLine and Diluted Non-GAAP Net Income Per Share Attributable to BlackLine, Inc. Non-GAAP net income attributable to BlackLine is defined as GAAP net income 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 0.00% 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 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 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 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 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, the most comparable GAAP measures, to non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income (loss), 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

The following table sets forth our statements of operations for each of the periods indicated:

Current wording

The following table sets forth our statements of operations information for each of the periods indicated:

Previous wording

Comparison of Quarters and Nine Months Ended September 30, 2024 and 2023

Current wording

Comparison of Quarters Ended March 31, 2025 and 2024

Previous wording

The increase in revenues for the quarter and nine months ended September 30, 2024, compared to the quarter and nine months ended September 30, 2023, was primarily driven by revenue from new customers, while revenue from existing customers grew from additional users and product expansion. The total number of customers and users at September 30, 2024, increased by 1% and 4%, respectively, as compared to September 30, 2023.

Current wording

The increase in revenues for the quarter ended March 31, 2025, compared to the quarter ended March 31, 2024, was primarily driven by revenue from existing customers, which also grew from additional users and product expansion. The total number of customers and users at March 31, 2025, increased by 1% and 2%, respectively, as compared to March 31, 2024.

Previous wording

•$2.9 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;

Current wording

•$1.2 million increase in computer software expenses due to higher spend on cloud hosting services as customers continue to migrate to the Google Cloud Platform (“GCP”), as well as upgrades to support business growth;

Previous wording

•$0.8 million increase in amortization of developed technology due to net additions to software placed into service; and

Current wording

•$1.0 million increase in amortization of developed technology due to net additions to software placed into service; and

Previous wording

•$0.4 million decrease in depreciation and amortization due to certain assets being fully amortized.

Current wording

•$0.7 million decrease in depreciation and amortization due to certain assets being fully amortized.

Previous wording

•$1.1 million decrease in depreciation and amortization primarily due to certain intangible assets being fully amortized; and

Current wording

•$1.4 million decrease in depreciation and amortization due to certain assets being fully amortized.

Previous wording

The decrease in research and development expenses for the quarter ended September 30, 2024, compared to the quarter ended September 30, 2023, was primarily due to the following:

Current wording

The increase in research and development expenses for the quarter ended March 31, 2025, compared to the quarter ended March 31, 2024, was primarily due to the following:

Previous wording

•$2.3 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 wording

•$0.5 million increase in capitalized software costs primarily due to required updates to access new markets, and ongoing development of cloud-based and new solution offerings. Collectively, these increases resulted in a decrease in net expenses; and

Previous wording

The increase in general and administrative expenses for the quarter ended September 30, 2024, compared to the quarter ended September 30, 2023, was primarily due to the following:

Current wording

The decrease in general and administrative expenses for the quarter ended March 31, 2025, compared to the quarter ended March 31, 2024, was primarily due to the following:

Previous wording

•$3.9 million decrease due to an increase in net foreign currency gains due to the strengthening of multiple currencies against the U.S. Dollar;

Current wording

•$3.1 million decrease due to an increase in net foreign currency gains due to the strengthening of multiple currencies against the U.S. Dollar;

Previous wording

•$0.4 million decrease in professional fees; and

Current wording

•$0.9 million decrease in professional fees; and

Previous wording

The decrease in interest income during the quarter ended September 30, 2024, compared to the quarter ended September 30, 2023, was due to decreased average balances on our investments, partially offset by increased average rates on our investments and cash balances.

Current wording

The decrease in interest income during the quarter ended March 31, 2025, compared to the quarter ended March 31, 2024, was due to decreased average balances on our investments and, to a lesser extent, a decrease in average rates on our investments and cash balances.

Previous wording

The increase in interest expense during the quarter and nine months ended September 30, 2024, compared to the quarter and nine months ended September 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 and the repayment of our 2024 Notes in August 2024. Refer to “Note 7 - Convertible Senior Notes” for additional information.

Current wording

The increase in interest expense during the quarter ended March 31, 2025, compared to the quarter ended March 31, 2024, was primarily due to the cash interest expense and amortization of debt issuance costs related to our 2029 Notes issued in May 2024, partially offset by a decrease in interest expense from the partial repurchase of our 2026 Notes and the repayment of our 2024 Notes in August 2024. Refer to “Note 8 - Convertible Senior Notes” in our condensed consolidated financial statements for additional information.

Previous wording

We are subject to federal and state income taxes in the U.S. and taxes in foreign jurisdictions. For the quarter ended September 30, 2024, our annual estimated effective tax rate differed from the U.S. federal statutory rate of 21% primarily as a result of state taxes, foreign taxes, and changes in our valuation allowance for income taxes.

Current wording

We are subject to federal and state income taxes in the U.S. and taxes in foreign jurisdictions. For the quarter ended March 31, 2025, our annual estimated effective tax rate differed from the U.S. federal statutory rate of 21% primarily as a result of non-deductible officer compensation, stock-based compensation shortfalls, foreign taxes, and changes in our valuation allowance for income taxes.

Previous wording

For the quarters ended September 30, 2024 and 2023, we recorded $2.1 million income tax expense and $2.0 million income tax benefit, respectively. The income tax expense for the quarter ended September 30, 2024 compared to the income tax benefit for the quarter ended September 30, 2023 resulted primarily from the 2023 release of $1.7 million existing valuation allowance in connection with the Data Interconnect Acquisition and changes in the mix of profitable jurisdictions.

Current wording

For the quarters ended March 31, 2025 and 2024, we recorded income tax expense of $4.7 million and $0.9 million, respectively. The increase in income tax expense for the quarter ended March 31, 2025, compared to the quarter ended March 31, 2024, resulted primarily from stock-based compensation shortfalls for the quarter ended March 31, 2025, along with changes in valuation allowance and changes in the mix of profitable foreign jurisdictions.

Previous wording

At September 30, 2024, our principal sources of liquidity were an aggregate of $846.3 million 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.

Current wording

At March 31, 2025, our principal sources of liquidity were an aggregate of $866.5 million of cash and cash equivalents and marketable securities, which primarily consist of short-term, money market mutual funds, commercial paper, and U.S. treasury securities.

Previous wording

We believe our existing cash and cash equivalents, investments in marketable securities and cash from operations will be sufficient to meet our working capital needs, capital expenditures, and financing obligations for at least the next 12 months.

Current wording

We believe our existing cash and cash equivalents, investments in marketable securities, and cash from operations will be sufficient to meet our working capital needs, capital expenditures, financing obligations, and share repurchases for at least the next 12 months.

Previous wording

We had $905.2 million aggregate principal amount of Notes outstanding at September 30, 2024. We plan to, and believe we are able to, make all expected interest payments in the next 12 months.

Current wording

We had $905.2 million aggregate principal amount of Notes outstanding at March 31, 2025, of which $230.2 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.

Previous wording

In connection with the offering of the 2029 Notes, we entered into privately-negotiated capped call transactions (the “2029 Capped Calls” and together with the 2026 Capped Calls, the “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 September 30, 2024, all of the 2029 Capped Calls remained outstanding.

Current wording

In connection with the offering of the 2029 Notes, we entered into privately-negotiated capped call transactions (the “2029 Capped Calls” and together with the 2026 Capped Calls (as defined below), the “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 upon any conversions of the 2029 Notes 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. At March 31, 2025, all of the 2029 Capped Calls remained outstanding.

Previous wording

In connection with the offering of the 2026 Notes, we entered into privately-negotiated capped call transactions (the “2026 Capped Calls”) with certain counterparties covering, subject to anti-dilution adjustments, approximately 6.9 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 2026 Capped Calls have an initial strike price of $166.23 per share subject to certain adjustments, which corresponds to the initial conversion price of the 2026 Notes and an initial cap price of $233.31 per share, subject to certain adjustments. As of September 30, 2024, all of the 2026 Capped Calls remained outstanding.

Current wording

In connection with the offering of the 2026 Notes, we entered into privately-negotiated capped call transactions (the “2026 Capped Calls”) with certain counterparties covering, subject to anti-dilution adjustments, approximately 6.9 million shares of our common stock, and are generally expected to offset the potential economic dilution of our common stock upon any conversions of the 2026 Notes up to the initial cap price. The 2026 Capped Calls have an initial strike price of $166.23 per share subject to certain adjustments, which corresponds to the initial conversion price of the 2026 Notes and an initial cap price of $233.31 per share, subject to certain adjustments. At March 31, 2025, all of the 2026 Capped Calls remained outstanding.

Previous wording

As of September 30, 2024, we have obligations totaling $25.8 million related to existing property and equipment leases.

Current wording

At March 31, 2025, we have obligations totaling $28.1 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 September 30, 2024, we have $206 million of contractual obligations related to eight commitments, with $47 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 March 31, 2025, we have $206 million of contractual obligations related to eleven commitments, with $60 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 September 30, 2024, while we have liabilities for unrecognized tax benefits of $8.2 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

At March 31, 2025, while we have liabilities for unrecognized tax benefits of $19.1 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 future capital requirements will depend on many factors, including our growth rate, strategic relationships and international operations, the timing and extent of spending to support research and development efforts, future merger and acquisition activities, repurchase or refinancing of our existing indebtedness, and the continuing market acceptance of our solutions. From time to time, we have required, and may in the future require or opportunistically raise, additional equity or debt financing. Sales of additional equity or equity-linked securities could result in dilution to our stockholders. If we raise funds by borrowing from third parties, the terms of those financing arrangements would require us to incur interest expense and may include negative covenants or other restrictions on our business that could impair our operating flexibility. We can provide no assurance that financing will be available at all or, if available, that we would be able to obtain financing on terms favorable to us. If we are unable to raise additional capital when needed, we would be required to curtail our operating activities and capital expenditures, and our business operating results and financial condition would be adversely affected.

Current wording

Our future capital requirements will depend on many factors, including our growth rate, strategic relationships and international operations, the timing and extent of spending to support research and development efforts, future merger and acquisition activities, repurchase or refinancing of our existing indebtedness, repurchases of our common stock, and the continuing market acceptance of our solutions. From time to time, we have required, and may in the future require or opportunistically raise, additional equity or debt financing. Sales of additional equity or equity-linked securities could result in dilution to our stockholders. If we raise funds by borrowing from third parties, the terms of those financing arrangements would require us to incur interest expense and may include negative covenants or other restrictions on our business that could impair our operating flexibility. We can provide no assurance that financing will be available at all or, if available, that we would be able to obtain financing on terms favorable to us. If we are unable to raise additional capital when needed, we would be required to curtail our operating activities and capital expenditures, and our business operating results and financial condition would be adversely affected.

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 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 discounts and amortization 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 depreciation and amortization, stock-based compensation, non-cash lease expense, amortization of debt issuance costs, accretion of premiums on marketable securities, and deferred taxes.

Previous wording

For the nine months ended September 30, 2023, cash provided by operations was $84.4 million, resulting from net non-cash expenses of approximately $47.1 million, net income of $34.8 million, and net cash flows provided as a result of changes in operating assets and liabilities of $2.5 million. The $2.5 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 quarter ended March 31, 2025, cash provided by operating activities was $46.7 million, resulting from net non-cash expenses of approximately $28.9 million, net cash flows provided as a result of changes in operating assets and liabilities of $12.6 million, and net income of $5.3 million. The $12.6 million of net cash flows provided as a result of changes in our operating assets and liabilities reflected primarily the following: