Cloud Stocks: BlackLine Leverages AI For Industry First Offerings

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Accounting software solution provider BlackLine (Nasdaq: BL) recently announced its fourth quarter results that shattered market expectations. The company remains committed to a long-term strategy and vision of focusing on solutions across financial close, consolidation, intercompany accounting, and invoice-to-cash as it enhances its product offerings.
 

BlackLine’s Financials

BlackLine’s fourth quarter revenues grew 11% to $155.7 million, ahead of the market’s estimate of $154.2 million. Adjusted net income of $0.69 per share was also ahead of the Street’s estimated $0.55 per share.

For the full year, BlackLine’s revenues grew 13% to $590 million and EPS was $0.81.

Among key metrics, total users came in at almost 386,815 compared with the analyst average estimate of 394,345. It ended the quarter with almost 4,400 customers. Revenues from professional services fell 5% to $8.58 million and revenue from subscription and support improved 12% to $147.16 million. Analysts were looking for $8.44 million in revenues from professional services and $145.81 million in revenues from subscription and support services.

For the first quarter, BlackLine expects revenues of $154-$156 million and an EPS of $0.45-$0.48. The market was looking for revenues of $155.27 million and an EPS of $0.47. The company expects to end the year with revenues of $637.5-$649.5 million and an EPS of $2.01-$2.14. The market was looking for revenues of $656.67 million and an EPS of $1.99.
 

BlackLine’s Product Upgrades

BlackLine is leveraging AI capabilities to enhance its product offerings. Last year, it announced the industry’s first AI-enabled intercompany accounting capabilities. The solution has been designed with the intention of preventing transaction failures before they occur and minimizing time and resources spent across the entire transaction lifecycle.

Known as the Intercompany Predictive Guidance, the solution is being integrated into BlackLine’s suite of intercompany financial management solutions. It uses AI and ML capabilities to analyze transactional data and predict those areas where issues are most likely to arise and pose a risk to financial close processes and data accuracy. By highlighting high-risk transactions, can proactively show to the accounting team where immediate corrections are possible.

It continues to improve upon its Intercompany offerings by adding trade management capabilities within the solution. By harmonizing and unifying data across multiple ERPs, reducing tax filing time and effort, and overall close cycles, BlackLine’s intercompany solution provides a view into all transactions, helping to ensure correct taxes are applied across entities and geographies for both the buyer and seller. This new product enhancement is also one of the first in the industry and makes it the only solution able to handle both trade and non-trade transactions, optimized for multi-ERP environments.

Also keeping in mind the need for virtual team connects, BlackLine has expanded its integration with the Microsoft ecosystem for a faster close and consolidation. It has added Microsoft Teams integration and introduced new capabilities to its Microsoft Dynamics 365 (D365) Connector, which helps streamline and optimize key finance and accounting processes. Through its Teams integration, companies can now see real-time administrative, system, and business workflow-related alerts directly in Microsoft Teams chat. BlackLine is able to deliver actionable and real-time notifications to enable users to make better-informed and more timely decisions. The Microsoft D365 Connector allows for an automated data flow from their D365 ERP and even pull more data types including currency rates and multicurrency balances to improve overall financial close efficiency.

BlackLine’s stock is trading at $56.84 with a market capitalization of $3.48 billion. It hit a 52-week high of $72.09 in March last year and a 52-week low of $47.26 in November last year.


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Disclosure: All investors should make their own assessments based on their own research, informed interpretations, and risk appetite. This article expresses my own opinions based on my own research ...

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