Good day and thank you for standing by. Welcome to the Q3 2022 BlackLine Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ remarks, there will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to turn the conference over to your speaker for today. Please go ahead, sir.

Good afternoon and thank you for joining us today. With me on this call is Marc Huffman, Chief Executive Officer of BlackLine, and Mark Partin, Chief Financial Officer. Before we get started, I would like to note that certain statements made during this conference call that are not historical facts, including those regarding our future plans, objectives, and expected performance, in particular, our guidance for Q4 and full year 2022, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent our outlook only as of the date of this call. While we believe any forward-looking statements we make are reasonable, actual results could differ materially because the statements are based on our current expectations as of today and are subject to risks and uncertainties, including those stated in our periodic reports filed with the Securities and Exchange Commission, particularly our Form 10-K and Form 10-Q. We do not undertake and expressly disclaim any obligation to update or alter our forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by applicable law. Also, unless otherwise stated, our financial measures disclosed on this call will be non-GAAP. A discussion of these non-GAAP financial measures and information regarding reconciliations of our GAAP versus non-GAAP results is currently available in our earnings release, which may be found on our Investor Relations website. Now, I'll turn the call over to BlackLine's Chief Executive Officer, Marc Huffman. Marc?

Thank you, Matt, and good afternoon, everyone. Thank you for joining us today. BlackLine delivered solid financial results this quarter with revenue growing 23% year-over-year to $134 million. Additionally, we saw continued margin and free cash flow improvement due to further operating efficiencies and disciplined expense management. Turning to the broader macro environment, while we are experiencing some elongation of sales cycles, we are seeing healthy demand signals across our pipeline as customer engagement and interest remains high. Our strategic product portfolio continues to generate positive momentum, as solutions that drive high automation and efficiency become even more top of mind for customers. Additionally, our competitive win rates remained strong in the quarter, reaffirming the fact that our solutions continue to differentiate us in the market. As noted, customer engagement and top of funnel activity remains healthy as customers and prospects look to leverage software and automation to help them operate successfully during periods of uncertainty. One of the more relevant topics of conversation today with customers is cash management and automation, particularly solutions that optimize working capital, reduce cash collection time, and provide incremental revenue opportunities. A recent study conducted by the Hackett Group found that the 1,000 largest public companies had nearly $1.7 trillion tied up in excess working capital, capital that could be deployed more efficiently and drive improved cash flow. BlackLine's powerful accounts receivable automation capabilities enable our customers to reduce collection times and unlock trapped working capital. We recently released the new AR intelligence capability that leverages customers' payment behavior to provide valuable data intelligence to organizations on both the opportunities and risks associated with their customer base. Our recently announced customer attractiveness scoring capability enables companies to identify customers within their base that have minimal risk, allowing for potentially higher credit limits, which provide incremental revenue opportunities. Additionally, the capability identifies higher-risk customers that are likely to default or delay payments, enabling companies to engage with their customers proactively while mitigating potential cash flow challenges. Features such as these have become extremely relevant in today's environment. Innovation continues to be a strength for BlackLine, whether it's in our core financial close solutions or across our strategic product portfolio. Our commitment to developing and delivering solutions that address unmet market needs remains as strong as ever. In intercompany, for example, we recently released the industry's first tax hyperautomation capabilities for intercompany financial management. These capabilities offer a range of new functionalities designed to optimize and automate an organization's total tax incidents across multiple legal entities and billing routes, thereby maximizing staff efficiency and accounting accuracy. Leaving tax considerations into how intercompany processes are optimized helps significantly improve control, transparency, and overall business outcomes. In our core financial close solutions, we continue to develop and release new functionality to improve and enhance and automate close process activity. For example, our focus on improving and enhancing our ERP connectors, which are vital to the seamless transfer of data from multiple ERP instances to BlackLine software, has proven to be extremely important to our customer base and to BlackLine. We see substantial opportunity to increase connector uptake across our installed base, leading to both revenue growth and higher net revenue retention. For reference, the average NRR improvement from connector utilization is five points favorable to our company-wide dollar-based net revenue retention. Our commitment to innovation and delivering solutions that drive real value for our customers and BlackLine remains steadfast. Next week, we are hosting our annual customer conference Beyond the Black, where many of the world's greatest companies will join us to learn more about the innovation we are delivering and how we are further differentiating ourselves. We expect to announce innovative new solutions, such as financial reporting analytics and BlackLine's Accounting Studio, while expanding the modern accounting playbook to our cash application solution. And as part of the event, our customers will be sharing their digital transformation stories and the substantial ROI they achieved by partnering with and trusting BlackLine. We're excited about next week and look forward to your participation. Now, let's take a moment to review our Q3 highlights and dive deeper into our results. Total revenue in the third quarter was $134 million, up 23% versus the prior year. Average deal sizes increased this quarter, up 12% versus the prior year to $127,000. Notably, we are seeing further success expanding within our customer base and upselling higher ticket strategic products. Our average enterprise deal size is now above $200,000 and increased by 15% versus last year. And at the end of the quarter, we had 49 customers that generate $1 million or more in ARR, up 58% year-over-year. Turning to our markets for a moment, we saw a modest year-over-year increase in North America sales, leading to some great expansion and new customer wins. APAC performance in the quarter was strong and saw an acceleration in deal activity across the region. However, in EMEA, sales activity was softer, driven by regional macroeconomic challenges and seasonal weakness from our SolEx partnership. We continue to see examples of great wins and competitive takeaways across the business despite the uncertain sales environment. In North America, for example, we signed a great new deal and competitive takeaway with the largest transportation and ridesharing company. The customer was looking to improve their financial close process while driving additional operating efficiencies, freeing up their staff to focus on more strategic and value-added work. In strategic products, our performance was solid again as customers demand innovative new solutions that solve large, complex, and unaddressed problems. We signed some great expansion and new customer deals this quarter. For example, we were able to expand beyond financial close with a large UK-based multinational oil and gas company. Having seen the benefits of partnering with BlackLine previously, the customer wanted to expand our relationship while improving and automating their intercompany processes. Working with one of their key consulting partners, we were able to showcase how our best-in-class intercompany solution can improve efficiency and deliver high automation to complex, labor-intensive, and time-consuming business activities. Continuing to build on our success in intercompany, we're pleased to announce that we also signed a leading EMEA-based insurance and financial services provider. As a brand-new customer, they were seeking to move away from manual, inefficient, and high-risk intercompany processes. They quickly recognized that a trusted intercompany solution from a partner with a strong reputation and a focus on customer success was the best path forward. In AR automation, we also saw some great expansion wins as well. For example, a leading automobile manufacturer and longtime BlackLine customer was looking to move away from manual and labor-intensive AR tasks and into an automated and efficient end-to-end process. From day one, we laid out the benefits that our modern AR solutions offer and how these complement our existing financial close solutions. Whether it's reducing DSO, unlocking working capital, or reducing bad debt expense, our AR solutions were exactly what the customer was looking for. Expanding BlackLine's partner network remains a priority and is a key component of our broader go-to-market strategy. As part of this, we recently signed a global consulting partnership with Accenture to strengthen our partner network, increase our global footprint, and extend our competitive positioning. Our SolEx partnership is seeing success driving new pipeline opportunities and deals around the world. However, as noted, we saw some seasonal weakness in Q3 attributed to SAP. We expect to see heightened deal activity from this partnership in Q4 based on our historical experience combined with our near-term pipeline visibility. Turning to some of our recent select wins, especially in EMEA, we signed a new deal with a leading Dutch multinational retail and wholesaling company focused on bringing automation, control, and efficiency into their financial close process. Leveraging our relationship with SAP and other key partners, we demonstrated the value we could provide and how our solutions fit into their long-term digital transformation roadmap. In another example from EMEA, we were able to win an expansion deal with a global luxury goods designer and manufacturer. The customer's previous success with our core financial close solution and the desire to further automate their finance and accounting processes provided the perfect opportunity for us to leverage our SAP partnership to upsell additional use cases for our transaction matching solution. These examples were great wins for BlackLine and reinforce the long-term opportunity that we see. Our proven ability to deliver value, drive efficiency, and deliver automation to customers across markets and geographies is a key reason why we continue to win. In closing, I want to thank all of our talented employees globally for their efforts and dedication. Serving our customers and delivering on our promise is vital to our success. BlackLine is positioned to capture multiple long-term opportunities while driving profitable growth. With that, I'll turn it over to Mark Partin to discuss the details of our financial performance and our outlook.

Thank you, Marc, and good afternoon, everyone. This was a solid quarter for BlackLine with progress on many fronts. We're seeing healthy momentum in customer account growth, an area we've invested in over the past few years. Our strategic product portfolio is generating strong interest from customers with healthy upsell activity across our base. Our competitive win rate remains strong and consistent. And finally, we're driving more efficiencies and productivity across our business, leading to healthy margin expansion and free cash flow generation. Furthermore, we're positioning ourselves to balance successful near-term execution and long-term growth. As part of this, we're ensuring that BlackLine employees stay focused on supporting our customers and enabling their success. We're driving deeper accountability across the organization in order to deliver on time and on budget and in scope. We've embedded further cost and investment rigor across the company. We're extending our competitive positioning through investments in innovation and infrastructure for scale. And finally, we're optimizing capacity and expected market demand. Now let's review some key results and highlights for Q3. Total revenue grew to over $134 million, up 23% compared to the third quarter of 2021. Professional services revenue growth accelerated in the quarter, up 26% versus the prior year, highlighting customer desire to unlock the embedded value that our solutions provide. Calculated billings growth was 18% versus last year and was up three points sequentially despite a two-point headwind from FX. Additionally, remaining performance obligations or RPO was up 29%, with current RPO growing 23% year-over-year. We added 57 net new customers in Q3, bringing our total customer count to 4,050. Lower new customer deal activity in the middle market was the primary headwind to new customer growth in the quarter. Strategic product performance remained solid and represented 23% of sales, driven by healthy demand for high automation and high ROI solutions like intercompany financial management. Partners were involved in 70% of large deals as we leverage our partner network to drive additional opportunities across markets and geography. Sales from our SAP partnership were seasonally soft this quarter, but revenue remained steady, representing 24% of total revenue. Shifting to margin, non-GAAP overall gross margin remained high at 80%, and non-GAAP subscription gross margin was 83%. Our services teams delivered an impressive performance in the quarter due to higher utilization and further productivity gains. Non-GAAP operating margin was 8% in the quarter, a notable improvement versus Q2, driven by a combination of gross margin performance, sales and marketing efficiencies, and disciplined expense management. Hiring in the second half of the year continues to taper as planned as we optimize our teams, balancing demand with an appropriate level of sales capacity. Non-GAAP net income attributable to BlackLine was $15.1 million in Q3, representing an 11% non-GAAP net income margin, up sharply versus Q2. We generated $24.2 million in operating cash flow and $16.6 million in free cash flow in the quarter, with a free cash flow margin of 12%. Our strong free cash flow performance was up year-over-year and drove a 35% on the rule of 40%. And finally, we finished the quarter with over $1 billion in cash equivalents and marketable securities, providing great financial flexibility to operate in today's market. Turning to guidance, we previously called out a three-point headwind to full year revenue growth given macro conditions. Based on our experience in Q3, especially as FX volatility continued, we're adjusting our full year revenue guidance slightly. On the bottom line, we're seeing stronger margin performance than previously expected, driven by favorable operational leverage, and as such, our full year non-GAAP net income expectations are moving higher. For the fourth quarter, we expect total GAAP revenue to be in the range of $138 million to $141 million, representing approximately 20% to 22% growth compared to the fourth quarter of 2021. We expect to report non-GAAP net income attributable to BlackLine in the range of $11 million to $14 million, or $0.15 to $0.19 on a per share basis. Our share count will be approximately 73.7 million diluted weighted average shares. And for the full year 2022, we expect total GAAP revenue in the range of $521 million to $524 million, representing 22% to 23% growth compared to full year 2021. On the bottom line, we expect to report non-GAAP net income attributable to BlackLine in the range of $32 million to $35 million, or $0.44 to $0.48 on a per share basis. Our share count will be approximately 73 million diluted weighted average shares. In closing, we're pleased with the progress we're making and the solid financial performance we delivered this quarter, even in the face of market uncertainty. BlackLine is positioned to execute successfully today while capturing the longer-term growth opportunities we see. The resilient nature of our business model combined with our leadership position and competitive advantages are strengths that we expect to leverage going forward. Now, I ask the operator to open the discussion to take your questions.

Thank you. The first question is from Alex Sklar of Raymond James. Your line is open.

Great. Thank you. Marc Huffman, I know the fourth quarter is kind of your big selling quarter. I'm curious if you can update us on what you're seeing through October in terms of late-stage pipeline and bookings. Any change in the trend versus what you called out last quarter in terms of the one-point headwind that you called out for the sales cycles?

Yeah, Alex, thanks for the question. Thus far, our sales activity in Q4 has been strong. The pipeline has remained robust throughout. We have some good examples of opportunities which were larger opportunities that had previously slowed down receiving additional scrutiny toward closing, including one of the largest deals in our pipeline through SolEx. So pleased with that thus far. As to your other question about a one-point headwind.

Yeah, I think that we had talked about a two-point headwind from FX and from elongated sales cycle. Our expectation is that might be closer to 2.5 points hence the revenue guide down. However, as Marc said, at this point in the quarter the sales are going well.

Okay. Great. I mean, this quarter you showed a really impressive ability to ramp margins quickly when the environment calls for it. And I guess, just given what we saw in the third quarter OpEx spend, how are you thinking about overall investments heading into 2023? Are you happy with the kind of the team in place given the opportunities in front of you?

Yeah. Thanks. The first part of this year, at the end of last year, we did some really strong hiring to rehydrate the sales force and put some scale into the organization with the expectation to taper in the second half. So in large measure, this improvement in operating efficiency was expected. And in addition to that, of course, we've talked about operating discipline and rigor. Going into the fourth quarter in our guidance, you'll see that we're expecting to continue this. This is where we spent last year in generating significant amounts of cash and margin. And this is where I think our business can operate for a while. So, the answer is yes.

Okay. Great. Thank you, both.

Thank you. One moment for the next question. I have the next question coming from Pinjalim Bora of JPMorgan Chase. Your line is open.

Hey. Thank you so much for taking the questions. Marc Huffman, I just wanted to drill a little bit on the macro environment. Would you say the environment has taken a step down or do you feel like it's more of a continuation of what you saw last quarter? And in terms of the customer discussions that you're having, are you seeing people kind of start reassessing their 2023 budgets down? Any color would be helpful.

Yes. Thanks, Pinjalim. Hey, I would say it's a continuation. We're yet to see anything in the macro picture, other than deals getting the extra scrutiny that we've described previously. So think of that as down funnel velocity. Extra steps to close remains the most notable macro impact, if you will. The top of the funnel still remains strong. And like I said before, we continue to close business in all segments. With regard to what the impact is on 2023, our team is out in the market right now talking about a variety of things as it relates to planning next year's participation and budgets with our prospects and customers. As you know, we have products that are high value, high automation that provide great value in all different types of climate. So we're having those kinds of conversations with people. We're also having conversations about some of the changing dynamics, the SEC put out a rule recently about executive comp being tied towards a recall against weaknesses in financial reporting data. So our teams are out highlighting that capability to people, how we can provide answers to those things. I think the message is really resonating with clients and we feel like we're going to get our fair share of dollars associated in 2023.

Okay. Understood. One question for Mark Partin. On the billings, which is everybody's favorite subject, it seems like it was flat sequentially, which is stronger than we have seen in prior years in Q3. But, I guess, is it possible to understand if you happen to close the deals that slipped out of the last quarter? Any way to quantify that? And the core timing headwind that you kind of talked about in prior quarters, is that starting to reverse at this point?

Yes. Billings in Q3 were 18% up from a year ago. And that's with a two-point headwind from FX. And so, traditionally, Q3 would be a seasonal quarter for us. Last year, Q3 was one of our strongest quarters, and we called it out as being able to sell through that seasonality, which was positive. I think this year we saw the seasonality. Nevertheless, we still finished with an 18%, three points up from Q2. So it was an increase from Q2. And then, when you look at RPO, which was a 29% increase, and CRPO which was a 23% increase. What we did in Q3, we believe, was really add to the overall backlog, the commitment that customers are transacting particularly in the seasonal quarter where we saw some aspects of weakness that Marc talked about. And that puts us on a trailing 12-month billing of 19%, which is a number that we pay a lot of attention to as it works out the variability from quarter to quarter.

Okay. Understood. Thank you. I’ll get back in the queue.

Thank you. One moment while we prepare for the next question. The next question I have is coming from Brent Bracelin of Piper Sandler. Your line is open.

Hi. This is Mauro jumping on for Brent here. Thanks for taking our questions. So I just had two questions. The first one being around customer preferences for certain payment timing schedules. As you talk to customers, are you seeing any uptick in customers asking for changes to the way that they do billings, maybe any preferences away from annual prepay or anything that we should just generally have on our radar? And then I have one follow-up.

Yes. Mauro, we're not. We're not. In fact, Q3 was one of our best working capital quarters in quite some time. I think it's to the value proposition of the importance of customers that rely on our platform that they're paying on time. And we've had little to no request for extended payment terms like we had in the beginning of COVID. This is – we have not seen that yet.

Okay. Got it. Thank you for that. And then last one for me. I think you cited some weakness, particularly with your mid-market customers. Is there any chance you could dig into that a little more? What exactly are you seeing or what might be causing the dynamic there? Thank you.

Yes. We did call out performance in the mid-market as being something that affected our new customer acquisition data. And so what I see there is again that sort of down funnel velocity, deals getting extra scrutiny, being pushed off a quarter, and wait-and-see type of attitudes on buyers. Not going away, not losing to competitors. Our win rates remain high, just sort of stalling, and not moving down in the lower part of the funnel.

Got it. Very helpful. Thank you.

Thank you. One moment while we prepare for our next question. And we have our next question coming from Patrick Joe of Baird. Your line is open.

Hey, guys. Thanks and congrats on a great quarter. It's great to see some operational improvement just with the margins and expense controls. Just one question on the partner channel. Just wondering if you could provide some additional color on the channel outside of SAP. I mean you've announced some great new relationships in recent quarters including Accenture, just this quarter. So just curious to hear about how these have progressed relative to your expectations just in light of the macro environment?

Yes. I think the data that we talk about oftentimes, we attribute the participation of partners on what we consider the larger opportunities that we closed in the quarter, and it was 70%. I think that's right where we like it to be. The non-SolEx ecosystem is important from a referral standpoint, from an advisory standpoint and a process engineering standpoint for customers that are really being identified as those that are ripe for digital transformation. We had been working with Accenture casually out in the marketplace for a number of quarters. That success has led to this global agreement that we announced recently. So I think it's a validation of us as a market leader. Their ability to create it with their customers and advise them on things that are super critical in our customers' accounting infrastructure. And then lastly, what we're seeing right now is a lot of excitement around intercompany financial management. These are going to be larger, more distributed and complex global enterprises who have these really deeply embedded relationships with these large providers like Accenture, like EY, and like Deloitte, and they're really ramping up to support what they think is a big opportunity in the intercompany.

Operator, can we go to the next question please?

Thank you. One moment while we prepare for the next question. And our next question will be coming from Daniel Jester of BMO. Your line is open.

Operator, can we go to the next question please?

I shall. Thank you. One moment. The next question is coming from Fred Lee of Credit Suisse.

Good afternoon everyone. Thank you for taking my question. I’m excited to start following the company closely from here on out. It was a strong quarter given the current environment. I have a few questions. Could you provide some insight into the growth related to SAP's initiatives? They highlighted it this quarter, and we've noted progress in all their back-office solutions across their installed base. How has this affected your SolEx business year-over-year? It appears to be quite stable. With SolEx making up 24% of your total revenues, is it helping to fill the pipeline? I'm curious if there’s a slowdown in velocity and what the overall impact has been this year compared to last year concerning that initiative.

Sure. That's a great question. The RISE initiative is a major focus for SAP. I believe we are well-positioned and in sync with their distribution team regarding this priority. There is strong potential in using BlackLine and modernizing accounting processes as they transition to S/4HANA through the RISE initiative. We have some excellent examples of customer successes and case studies that support these points, which we often leverage in our joint sales efforts with SAP. I think this is boosting our pipeline. The performance in Q3 was typical for the season; that's how we would characterize SAP's results with SolEx. We are optimistic about its impact in Q4, which usually sees an increase for us. Regarding SAP's role in our business, you noted that SolEx accounts for a certain percentage. I want to clarify that we should not have any misconceptions about that.

No, no that's right. SAP partnership revenue is 24% of the business. We call that out on disclosure and that has been flat year-over-year. And our goal, as we continue to partner with SAP and see success in that SolEx partnership, would be to drive that number higher, not to see it flat.

Thank you. My second question is if you could discuss the different areas where you are experiencing additional growth and where you are noticing more inconsistent demand.

Yeah. So the solution itself, our complete solution applies to virtually all industries. So it's a fairly horizontal deliverable that we have. That said, we are seeing strength in parts of the business. I think transportation, logistics, of late oil and gas, of late insurance, financial services of late. I don't believe there's any particular macro trends that are driving those things, just somewhat notable top of mind based on my awareness of where we're having great success. Overall, I think the dynamic that we're seeing right now is some slowdown again back low-funnel velocity, extra scrutiny on deals. It's happening sort of across the board, pronounced and mid-market. Otherwise, we still continue to be closing business in all segments, all industries.

Okay. And my final question is with regards to your automation solutions: what's the mix of those automation solutions in your pipeline? And how are those solutions priced relative to your core financial close? Thank you.

Yes. I think you're talking about our strategic products. No, those are our highest automation, highest value drivers. They make up a great portion of the pipeline. In times when we see customer expansion, and keeping in mind that the land-and-expand model is really one of the valuable parts of our long-term strategy, they make up a great deal of our pipeline. As you would imagine, those are generally priced on a consumption or volume-based business. So as we introduce new capabilities, new use cases, that drives consumption within customers. The customer gets great value through that high automation, and we in turn get an uptick in their ARR, which is one of the reasons why we have seen such significant growth in the customers that pay more than $1 million for BlackLine. We're up to 49 of those. That's 58% year-on-year growth.

All right. Thank you, gentlemen.

Thank you.

One moment for our next question. The next question is coming from Adam Hotchkiss of Goldman Sachs. Your line is open.

Good afternoon and thank you for the question. I wanted to explore further on the previous response regarding the strategic product area. The cross-sell opportunity is quite evident. Could you elaborate on the potential for growth with aspects like AR, especially considering the current focus on cash flow and cash management in the market? Will this have an impact on your ability to acquire new customers? I also have a brief follow-up.

Yes. We have experienced a significant number of new customer acquisitions from our accounts receivable products, particularly in cash application. We are also witnessing a wider engagement with our complete accounts receivable portfolio. I’m pleased with the year-over-year performance in accounts receivable, both in terms of new customer volume and growth. You’re correct that in current environments, cash management is likely to resonate with clients. This is evident not only for those undergoing digital transformation but also for those looking to scale. Therefore, in the upcoming week during Beyond the Black, we will focus on releasing our modern accounting playbook for cash application. This playbook will highlight our best practices based on our experience that have consistently delivered quick and valuable results. I believe that this practical approach to cash management during such times will really connect with our clients.

That's great. Really helpful. Thanks. And then on the profitability front, I just wanted to check in. Is there anything to call out incrementally on the sequential gross margin improvement other than the improvement on the professional services side? Because it looked like it was a pretty broad-based improvement there and wanted to make sure we understood that.

Yes. Thanks. We've had consistently really high gross margins in subscription. Professional services is a relatively small part of our overall revenue stream. So in the quarter to hit 80% was the benefit of a really great team effort from professional services to drive higher margins through utilization and higher revenue contribution. But also, another aspect of that is that we are undergoing a transition to the Google public cloud, and that migration is ongoing. So in any given quarter, we're expecting a one to 1.5, even two-point drag until we get to the end of that migration, which we've currently suggested would be the end of next year, early the following year. At that time, we would regain that one point to two points and be materially on the new migration of the public cloud. In this case, in Q3, the team again did a great effort; the level of migration, the pace of play, the efficiency that they operated in was very good. The accountability they had for driving down cost, while maintaining efficiency to drive over our customers, was very positive. We will see in future quarters as we go through the migration, plus or minus on that 80%. We would expect to continue to have a drag on gross margin around 79% to 80% until we can get to the end of the migration.

Really helpful. Thanks so much, Mark.

Thank you, appreciate the question.

Thank you for your patience as we prepare for our final question. Our last question is from Daniel Jester of BMO. Your line is open.

Hey, good afternoon. This is Kyle on for Dan. Thanks for taking our question. Could you maybe touch on the demand you're seeing in your AR and intercompany solutions? And then maybe how you're thinking about the integration of the intercompany product in Q4?

Yes. You bet. Thanks for the question. So both of those areas, I would call out as strength from a strategic product contribution in Q3 performance-wise. So quite pleased with those both. As I mentioned previously, I think that cash management in these times is a topic that will really resonate with clients of all sizes and all complexity. And so we'll be really focused on that. We've got a number of deliverables that have just come to market: the modern accounting playbook for cash application as well as our customer attractiveness scoring, which I think will create some really great opportunities for real-time visibility into credit exposure risk and opportunities for clients. In terms of the intercompany solution, we're really excited about where this stands in the product pipeline and portfolio. We'll be highlighting that bunch next week at our conference Beyond the Black. We've traditionally had a great intercompany business that was focused on identifying and remediating out-of-balance transactions. We're now with the intercompany financial management, bringing together the capabilities from 4Q and the acquisition with our existing intercompany capabilities. We'll be able to take people beyond that sort of concept of zero; just hitting the intercompany to balance out to zero and have them focus on how they can create value with the automation of the tax rules, the billing routes, etc. So, exciting innovation. I think it's going to really resonate with large complex multinational organizations who are under more pressure than ever right now to maintain compliance globally.

Thanks, guys.

Thank you. That concludes our Q&A session for today. I would like to turn the call back over to CEO, Marc Huffman for closing remarks.

Just to close up, I want to thank you all for your interest and support of BlackLine on an ongoing basis. We know that you meet with a lot of executives, CFOs, etc. And when they're interested in learning about modernizing their accounting, we hope that you send them our way. Thank you all, and have a great evening.

Thank you all for joining the conference call today. That concludes today's conference. You all have a great evening.