Good day, and thank you for standing by. Welcome to BlackLine's Fourth Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please note that today's conference is being recorded. I will now hand the conference over to Matt Humphries, Vice President of Investor Relations. Please go ahead.

Good afternoon, and thank you for joining us today. With me on the call are Owen Ryan and Therese Tucker, Co-Chief Executive Officers of BlackLine; as well as 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 Q1 and full-year 2023, 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 made during the call are reasonable, actual results could differ materially, as these 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, in particular 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. All comparisons we make on the call today relate to the corresponding period of last year, unless otherwise noted. Finally, 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 historical GAAP versus non-GAAP results is currently available in our earnings release, which may be found on our Investor Relations website at investors.blackline.com or in our Form 8-K filed with the SEC today. Now, I'll turn the call over to BlackLine's Co-Chief Executive Officer, Owen Ryan. Owen?

Thank you, Matt, and good afternoon, everyone. Thank you all for joining us today. We exceeded revenue and profitability expectations in the fourth quarter with $156 million in total revenue and $52 million in non-GAAP net income. Notably, we ended the year with $603 million in annual recurring revenue or ARR. Our performance this quarter was driven by continued success with partners, including our SolEx relationship and consistent sales performance from our mid-market teams. We also saw higher close rates and improvement in sales force productivity this quarter. Last year, Therese and I took the reins at BlackLine and embarked on a journey to refresh our long-term strategy and vision. Together, we spent a great deal of time working across the business, speaking with customers, and reenergizing relationships with our most trusted and strategic partners. On the back of these efforts, we took action to implement a more disciplined and refined corporate strategy and activate a new operating model for 2024. Our go forward strategy is simple. We plan to lead with our solutions across our markets, financial close, FRA and consolidation, intercompany accounting, and invoice to cash. One note here, invoice to cash is the new name for our end-to-end solutions, which contains our electronic invoicing presentment and payment. as well as accounts receivable automation solutions. Over the longer term, we expect to either build or acquire additional capabilities that can deepen and extend our platform consistent with the highest priorities within the office of the CFO. To support this, we're becoming a more partner powered organization, harnessing the deep and embedded relationships our partners have with key decision makers at our customers. We are also prioritizing certain markets and geographies that have the highest long-term potential for success. As we move through this year and into next, we…

Thank you, Owen. BlackLine has a proven history of innovation, which has been core to our culture, our strategy and our success since day one. In fact, in 2007, we defined and created the financial closed market that exists today, paving the way for companies to rethink how accounting work gets done. And since then, thousands of customers, some of the biggest brands in the world have put their trust in BlackLine to deliver real value, all while handling their most mission critical accounting and finance processes. We were the first company to develop and offer a commercial intercompany accounting solution. This, again, created another market, one which lacks modern solutions to address some of the most complex accounting problems that exist. And more recently, we announced how we are addressing real-time consolidation via our financial reporting and analytics solution, reshaping another market to support real-time business operations. And as we look ahead to this year, we expect to formally announce the release of the BlackLine Accounting Studio, a command and control orchestration layer for the thousands of finance and accounting processes occurring across a disjointed and multi ERP financial landscape. Building on this, the evolution of technology in recent years has provided us the opportunity to do things which weren't possible before. It has unlocked capabilities and tools that can propel our vision forward and deliver unprecedented value for our customers. Simultaneously, customer data volumes are surging, processes are growing more complex, additional regulations are being implemented and talent shortages in accounting and finance are becoming even more acute. Collectively, these factors create a convergence of challenges for customers. However, amidst these lies a substantial opportunity for an industry leader like BlackLine to innovate and to lead. And I am excited that our recently announced Chief Information Officer is…

Thank you, Therese. Our results this past quarter demonstrate that despite a market environment such as this, the predictability and leverage inherent in our model can support continued profitable growth. As we look ahead, accelerating innovation and operational execution are the priorities of BlackLine and those initiatives will be driven by our refreshed strategy and operating model. Now, let's review the financial results for the fourth quarter in a bit more detail. Total revenue grew to $156 million, up 11% with subscription revenue growing 12%. Services revenue declined 5%, as we continue to align to a more efficient servicing model. Calculated billings growth was 14% with trailing 12 month billings growth of 13%. Remaining performance obligations or RPO was up 9% with current RPO growing 13%. We closed the quarter with total annual recurring revenue or ARR of $603 million, up 13%. We added 30 net new customers in the quarter, bringing our total customer count at the end of the year to 4,398. While we saw a healthy growth customer adds, we also experienced a higher volume of churn from smaller customers. In our go-forward strategy, which Owen spoke to earlier, it is reasonable to assume some additional churn of these smaller customers as we move through 2024. Our revenue renewal rate was 94%, consistent with prior quarter and net retention rate or NRR was 106%. Strategic product performance represented 24% of sales, driven by transaction matching, account receivable automation and FRA and consolidation. Partners were involved in 73% of large new and expansion deals this quarter. SolEX performance continues to grow well ahead of our total revenue growth rate and had a solid show in this quarter. In Q4, SAP partnership revenue represented 25% of total revenue. Turning to margin, our non-GAAP gross margin was 80% with non-GAAP…

[Operator Instructions] And our first question coming from the line of Rob Oliver with Baird.

For Owen or for Therese, a question is for you. You guys have now been back in charge here almost a year. And I know, Owen, talking with you, there were a handful of key strategic initiatives you had going after that SI channel, SI relationships, SAP, the sales reorg. I think what we're hearing from you is you've made real progress on all three of those. Can you maybe rank order where you're seeing the most traction with those and where we expect to first see that kind of manifest in a turn in the revenue growth? And I had a quick follow-up, but if I'm limited to one, I'll hop back in the queue.

First, I would say, while we're very proud of the progress we've made. We're not satisfied with the progress we've made. There's still much more for us to do as an organization. I think of the three things that you've highlighted there from on our progress with systems integrators, the sales reorganization and SAP. I think we feel like we've made progress amongst in between all three of them at this particular point in time. I think for us, we're starting to see some real progress internally with the focus and discipline from our BDRs to our sales teams to the account management to the customer service teams, all working much more closely together, and we're very, very encouraged by that. Obviously, we started the call with the comment about the strength with SAP. This past quarter, we cited a number of examples. We usually don't just use those, but they were very powerful and very important given what's taken place. And so we're very encouraged by what's going on there. And recently SAPs, I believe, identified a new leader of their Office of the CFO program, which we're very excited about working more closely with that team. And then on the systems integrators, we're spending a lot of time with them. I think we're very -- we feel very bullish about their commitment. We've got good joint account plans that we worked our way through from covering everything off of how we'll go to market together, how do we make sure our customers are better implemented and adopted. There's a number of those folks that are working closely with Therese, providing feedback around the products as well as what we could potentially be doing in our industry vertical. So net-net, hard for me to rank all of them from a prioritization perspective. It's like naming your favorite child. But net-net, I think we feel pretty good about the progress we're making along all of those areas.

And if I might just quickly, just on the invoice-to-cash side, it sounds like you guys are taking this opportunity to think strategically about how to package and price your products potentially differently. And while I don't expect you to disclose anything new here today if it's in the works. Is that right? And how should we be thinking about kind of the way something like invoice-to-cash or other products if they're packaged or priced differently could start to impact maybe ARR per customer? Thank you.

Thanks, Rob. I'll jump in on this one. I think pricing is one of those things that's always an ongoing sort of experiment because ultimately what you want to do is you want to be able to share in the value that you're delivering to your customers, right? And I think we all know that user based pricing, if you're doing a good job, you're basically phasing out more users. So in terms of our strategic products, we are definitely looking at other ways of doing pricing. We've got our matching rate plans and other sort of types of pricing that are related to the complexity and the value that we deliver to our customers. So yes, we are looking at how to handle this invoice-to-cash a little bit differently and but nothing to announce today.

And our next question coming from the line of Alexander Sklar with Raymond James.

Owen, just starting with your comments around the partner success and the improved win rates, better close rates. Is there any way you can frame how much of that was from a stabilizing or improving macro that you saw in the fourth quarter versus the early benefits from the strategic initiatives that you just spoke to in your answer to Rob's question?

Yes. I think it's a really good question. I don't know that we're sitting here today saying, wow, we've gotten any kind of tailwind yet from the macro. In fact, I would say it still feels a little bit more like a headwind than a tailwind. I think the thing that I'm most proud of and we are proud of is the execution of our team. So we feel good about our close rate for opportunities both in the enterprise space as well as the mid-market where our teams executed we feel quite well, particularly on those customers we chose to pursue in the mid-market. So, I would say, not really a lot of support yet out of the macro, but we like the fact that our win rate feels pretty good for what we're trying to accomplish.

And then, Mark, just following up on the sales and marketing intensity, it's kind of been operating a bit below your medium and long-term targets from 15 months ago. I realize it's a long time in this macro, but how are you thinking about hiring from here for your go-to-market team and what's factored into the 2024 outlook in terms of sales and marketing?

Thanks, Alex. We started this year with sufficient capacity to expand and meet the market additional demand if and when it comes. We are operating very efficiently in that part of the organization, part of the leadership, but most of it just related to the intensity around the operating model changes and sort of some of the key aspects of driving greater sales rep productivity. Our plan for increasing capacity at a stage most likely after 2024 is to make sure that we have the best sales people at the right place focused on the customer demand if and as we see it come on board.

Got it. Just to make sure you're clear on that, so those medium-term targets still are relevant after '24 as you see it just in this interim period. We're still focused on getting those operating model changes in place?

That's right. Our sales and marketing is below the mid-term target model, which is your point. At this level of demand, we think it's at the right optimum level.

And our next Question coming from the line of Matthew VanVliet with BTIG. Your line is open.

Good afternoon. Thanks for taking the question. I guess when you're looking at the new refresh strategy you laid out. Curious in terms of what kind of timing you're expecting that to sort of play out? How much of that is going to encompass some meaningful sort of price increases or at least ASP increases with the additional functionality you are talking about? And then lastly, how much of the '24 guide or how much churn from the lower end customers is contemplated within that '24 guide? Thanks.

I think Therese and I may tag team a little bit on the answer to this question. I think just from a strategic perspective, what we're trying to do on pricing, Therese already gave a little bit of a hint to. We are taking a very hard look at the way we price the value that we deliver for our customers and that's probably the biggest thing we're trying to make sure is that, we deliver value so that our customers feel like they are getting an appropriate return on where they're spending their money with us. There is obviously, Therese intimated a little bit about this is sort of the year of innovation for BlackLine again. I'm certainly really excited about some of the things she and the team are driving and we can't wait to share more of that over the course of the year and we're working through how to begin to sort of reprice that additional value that our customers will be achieving. I think the thing just on the churn, if you will, for the smaller customers that was asked, what you recognized is sort of, there are a number of customers that we've been much more proactive in engaging with trying to figure out where they want to go on this journey and if BlackLine can really help them to succeed with what they're looking to do. I think what we expect is, we'll have some conversations with customers that may opt out, if you will, or will help them opt out because if they're not going to do the things that are necessary to drive the kind of transformation that we think is appropriate, they're not going to sort of really take advantage of the value that we have to offer them, then better off just sort of going our separate ways. Mark will probably give a little bit more guidance as to what that might mean from a churn and attrition perspective. But remember, these tend to be much smaller accounts. And so as a percentage of ACV, not particularly significant, but obviously from a customer count perspective, it sticks out a little bit more.

And our next question coming from the line of Dan Jester with BMO Capital Markets.

Maybe just to build off that last train of thought. Can you spend a few minutes talking about sort of the decision to expand in different verticals? Is this again about of optimizing the ROI for the customers? As you think about that sort of keep your push into verticals, is this going to affect sort of how you go to market in 2024? Or is this sort of a longer term initiative that we should expect to play out over time?

I love that question, so thank you, because it's near and dear to, I think what we're trying to accomplish here at BlackLine. I think one of the untapped crown jewels we had in this organization was our customer base. And what we're being smarter about now is understanding who our customers are in certain industries and then sub industries. And then where might the white space be for companies that we don't yet serve, and that's pretty obvious of where you might want to go next. I think the real thing that I'm excited to watch our team working with Therese and our partners and others on is the fact that we have companies in the same industry who are using our product for very different reasons and sort of being able to compare what's company A doing with company B versus company C, and then taking that insight and then being able to work with our partners and our product team and our sales teams, account management to go back to the customer and say, here's where you can find more value because your peer companies are also doing things very similar to this. And I think what it drives is much more value for our customer. It makes us much more efficient in what we're trying to do to help our customers be successful. It should make us more efficient, if you will. There is no more Johnny Appleseed approach to going after the marketplace. It's much more targeted around what we're trying to do. And early indications are very, very positive. Mark and I were on a call with one of our Asia Pacific teams yesterday, and they have a very large pursuit they're looking at, and we were just sharing with the similar kind of customers that we had both in Europe and North America that we could bring to this team over in Asia Pac. And I think that's going to wind up in the win column in the not too distant future because of being able to, again, leverage what we have internally that no one else has, to my knowledge, that we could bring to ,to our customers. And I think that's a real -- going to be a real boom for our customers over the coming years. We've already started it in 2024, so we have five industries that are already in development, and we'll keep driving that as quickly as we can throughout the course of the year.

And our next question coming from the line of Pat Walravens with Citizens JMP.

Therese, can we talk more about the solution pillars? So do you mind just going through, what they are again and how the role of the person who's in charge is going to work? In particular, are they on the hook for hitting the number and how does that work?

So the solution pillars, there are four today. And obviously, the first one is our financial close, which is typically been our bread and butter over the years. The second is intercompany financial management. The third is invoice-to-cash and the fourth is financial reporting analytics and consolidation, okay, one of our newer products. Now, the four solution pillar leaders are basically veterans in each of their respective areas and they have deep, deep market and product expertise. And yes, they are indeed, Pat, responsible for a number for their particular product line. They are also motivated in their comp packages to collaborate with one another. And so we've seen where that's a very powerful combination where the combination of certain products are much more effective in terms of win rates in certain segments of the market. So they have the role of basically bringing the voice of the customer into our product and tech organization because they are spending a lot of time with the go-to-market team to really understand directionally where the market is going, what our customers and our prospects are looking for. So they get to be on the both at the tip of the spear as well as bringing that knowledge back to the product and tech group where they have great influence on the roadmaps. And yes, to put teeth behind it, they all have their own numbers as well. Does that help?

Next question in the queue coming from the line of Koji Ikeda with Bank of America.

I wanted to kind of revisit the medium-term growth target, the 20% to 25% revenue growth target. Could you maybe help us understand, just thinking about with net revenue retention, what looks like to be stabilizing here to 106%? What are the components? How to think about the components there between new and expand and upsell and cross-sell to get to that 20% to 25% growth target?

Thanks, Koji. I think I'll start with the original algorithm for the mid-term targets and that begins with account expansion. We laid out $1 billion plus resident market opportunity in our existing customers, both large enterprise and mid-market. Based on the tools that we've either acquired, built, and are putting together, we've got a real opportunity through digital transformation to drive greater share of wallet inside the Office of the CFO. We're reaching higher and wider with our products and with our solutions and messaging. So the big opportunity for us is a focus on the account ownership and the customer success, we laid it out earlier in our comments to really expand inside and use those trusted relationships that we have with over 4,000 customers. The second and that in addition will drive our retention rate higher, our renewal rate higher and we believe that's the big focus of our algorithm. Now, the components of that include the strategic product upsell of course and then some of the things that we've talked to you about over the last year. The second component is the new logo acquisition. We still firmly believe that this is, in most of the markets where we operate today, still an untapped market potential. Whether it's in Europe or in Japan or even here in North America, there are, we believe that the financial close and I2C, invoice-to-cash and intercompany are still emerging opportunities with potential. And so the return to 20% to 25% is built on account expansion and continued market share growth and competing in the market to get new logos in the new markets and territories. That's where the strategy and the operating model are built to attack that algorithm.

Thank you. And our next question coming from the line of Pinjalim Bora with JPMorgan. Your line is open.

Great. Thank you for taking the question. Mark, I just wanted to ask you about the retention rates. Maybe if you can unpack, it seems like the gross retention is stabilizing a bit. Is it possible to unpack the gross retention between mid-market and enterprise? And trying to understand what needs to be done to move that retention back to where it was? What are you -- how are you thinking that trajectory to be? Is that going to be over the next 12 months or is it going to take time?

Thanks for the question, Pinjalim. I think that the beginning for us really is the renewal rate and really focusing on keeping and optimizing the customers we have. It's down at 94%. You are right. It has settled at that rate, that's high 80s in the mid-market and that's mid-90s in the enterprise, and we're accustomed to seeing those rates a lot higher. We believe that not only is this a period issue, but that so much of our attention is now focused on driving that number higher. We spend a lot of time, money and attention to get customers. We've got the best solution in the market. We believe it's a lot about execution through some of these macro headwinds and some of the noise that's in the market today. That's the beginning of driving the retention rate. The second component of it is digital transformation. We inspire that as part of our strategic objective. Digital transformation means that, as we have landed with our financial closed solutions and then build out up from there, with our strategic product solutions. We have been and are comfortable at 110 to 111. We are down to 105, 106, much this is the macro headwinds and some of these renewal rate issues that we've highlighted. And we think that through a more targeted account upsell program for our strategic portfolio through these dedicated pillar solution leaders that we can get that retention rate higher, particularly in the enterprise accounts. That's where our sort of strategy in 2024 plan is for 2024 and beyond.

And our next question coming from the line of Adam Hotchkiss with Goldman Sachs. Your line is open.

Great. Thanks for taking the question. I just wanted to touch quickly on FRA. I think you have called out that, that was a key part of some of the wins this quarter. Just curious if you see that opening up your market opportunities in the mid-market a bit more than you might have expected and how you marry some of the success there with some of your comments around being more targeted?

We have seen some very good success in the mid-market. It is a differentiator for us. Most mid-market sized companies that are out there now end up doing their financial reporting inside of Excel. And so offering them a tool that gives them sort of the control and the end-to-end visibility has been a very powerful motivator and differentiator in that market. I'm sorry, what was the second part of your question? I got all excited because you asked about FRA.

I was just curious how you marry some of that commentary around the success in the mid-market, with being more targeted? It just seems like if that's being successful, it seems like that might be opening up your market opportunity. They're a bit more than you might have expected. So just curious how you pull those two comments together.

I think, Adam, the important piece of this again is it's all about customer, client selection. And so, I think the thing that we're trying to do is make sure we have these very thoughtful conversations with the prospective customer through the sales cycle, about what's their vision, what are they trying to accomplish as an organization, where are they going, are they all in on sort of thinking about the blueprints and success plans that we can help them to create to drive what they're looking to do? And what you find is the mid-market is a very wide marketplace, right? And so this is all about finding those customers that best fit what we believe is an ideal customer profile for what we're trying to drive versus just chasing every organization that's out there. And so, again, I can't applaud my BDR team enough and what the sales and AMO teams are doing right now for really being very thoughtful, very strategic in the conversations that they're having because ultimately what you want to do, what we want to do is drive success for our customers. And again, part of that upfront is knowing that we're right for them and they're right for us as we move forward. And so I don't think that those statements are in conflict with one another. In fact, I think they're perfectly aligned, again, with helping us be more effective, efficient, and successful in helping our customers.

And our next question coming from the line of Brent Bracelin with Piper Sandler.

One of the big questions that we have across the broader software group, where we've seen growth flow for the last couple of years is trying to assess when growth rates start to trough. And if I think about your business, RPO here has slowed for two years. It's at 9% I think in Q4 here. Mark, what's your best guess when we start to trough? Is there any sort of silver lining in the pipeline that might suggest a bigger pipeline? Again, close rates have been the big issue, but walk us through your best guess on when RPO growth could start to bottom here after a couple of years of slowdown across the broader group?

It's probably getting me to opine on a trough for the entire SaaS group. I might not answer it directly. Don't be surprised. I would say though, all kidding aside, that some of the green shoots, we've talked about our execution, which certainly makes things feel a little better in a macro headwind, but we saw some green shoots in Q4 at the higher end of the funnel, larger deals that we were able to pull across, particularly in the account growth. That was a lot of extra heavy lifting and effort from the team. So seeing those things start to emerge are certainly positive signs, but we can't call that that's a new and sustainable motion that we see, especially so early in the year for us where a lot of our larger deal and digital transformations that are tied to either SAP, SolEx or to longer sales cycles. So for us, look, we try to show up for our customers and execute first, and we think that will start to close the gap in any macro environment. And here, we have many crosswinds, whether it's the version of SaaS ROI and accountability. And we think we hold up pretty well in the long-term for that. If customers are looking around for vendor consolidation and expense rationalization, our business case is very solid, especially when you are buying and using more than an application or financial close. So our growth profile is in a very important high ROI automation part of the Office of the CFO. And when that happens to from quarter to quarter is tough to call, but we know that it's a problem that hasn't gone away. It's only gotten bigger through this sort of downturn, if you will. Brent, that's the best I can do for calling a trough. But when it's in the rearview mirror, I'll tell you. Thank you for the question, Brent.

And our next question coming from the line of Steve Enders with Citi.

I appreciate all the innovation you talked about that's coming down the pipe this year. I guess maybe to start with what's been the early feedback as you're capturing the beta to customers? And I guess on the other side of it, how do you get the go-to-market right to capture to that potential there? And I guess, in particular, where does the budget opportunity come from as you go into and target those accounts?

Well, starting with feedback from customers, it's been pretty enthusiastic. But realize that I'm a big believer in co-development with our customers over time. We have been vetting ideas against them, then we vet prototypes, then we vet products. So when we finally get to the point where we launch, we expect to have nothing but very enthusiastic feedback. And frankly that's how you don't waste money on development, okay? So that's very good feedback today so far and I'm super pleased. Now, and likewise, we also work a lot with our partners in terms of what they're seeing in the market. A lot of times they have a much broader purview than we might. So lots and lots of feedback from idea, inception of idea all the way through to launching a product. Now, when we start launching a product that typically is a process where we will roll it out for some period of months with early adopters. Again, this is a much more in-depth. Now you're actually using it and a lot of times the feedback there will be slightly different because when they start to use it, they find out if it's easy or not, okay? Then we will typically launch into an internal pricing discussion on how to get things -- what the value seems to be. A lot of times our customers will take part in that. What are you willing to pay for it? And then finally, we really start to get the marketing teams involved and the go-to-market enablement teams, so that as we roll things out to our actual customer base, our go-to-market teams are ready to work with our customers and our prospects. That's kind of a quick overview. I hope that answers your question.

And our next question coming from the line of Chris Quintero with Morgan Stanley. Your line is open.

Hey, everyone. Thanks for taking the questions here. I think this one's for Mark. I want to ask around the fiscal year '24 revenue guide. Given the Q1 guide implies 11.5% growth, that would imply further deceleration into the rest of the year to get to your full year guide of 9%. Do you expect growth to further slow? Or are you embedding some more conservatism into that guide maybe compared to previous years?

Look, I'm a pragmatic and I think in this case, conservative guide for the year. And some of that is the market, but also a number of the operating model changes that we believe there is real opportunity for uplift with these changes. The timing for that is the thing that I think draws the most question. The guide is adequately conservative and pragmatic for the year. You are right. In Q4, we saw some good upticks in a few leading indicators, that's positive. Whether it's momentum or not going into this year, we're going to look for that visibility. I think that gives us an opportunity to execute and have very high confidence in not only the top level guide, but in the ability to generate improving operating leverage in the business during this year. Thank you for that question.

And our next question coming from the line of Terry Tillman with Truist. Your line is open.

Can you hear me?

Yes. Hi, Terry.

I thought they said Truist, but it cut out. Thanks for fitting me in. It is a single question. It may be multiple parts unfortunately though. On the SAP relationship, it's great to see the SolEX. It's great hearing about customers, specific customers. That was great in 4Q. What I'm curious about is we look at the '24, how are you thinking about percentage of revenue from SAP? And where do you see potentially, if there's going to be upside drivers from SAP? What are some of the more interesting incremental opportunities maybe product wise? And what about their perspective on your old AI journey and are they signed up and are they going to be pushing that as well? Thank you.

I think, Therese, you and I are going to have to tag team on this because you can maybe handle the AI piece of it. I would expect that, I don't know that we'll see a significant shift in what percentage of our revenue comes from SAP over 2024. I do think that the collaboration and communication and the teaming has gotten better across all aspects of what we're trying to do. Obviously, we're going continue to have resources dedicated both domestically and internationally to work in the local markets, where they are because all this business is done at a local level. I think that there is elements of what we're trying to do together in the marketplace, which seemed to be going quite well again from at least the feedback from my teammates here at BlackLine and then some of the senior executive meetings we're having between ourselves and SAP at this point in time. So all that, I think, bodes well for what we're trying to do. Obviously, they're a critical partner, but we also have another big part of our business, the other 75% that we're going to keep driving, as well. I think we feel pretty good about that overall. On the AI side, Therese, you want to talk a little bit more about that?

I think SAP, there's a couple of things about that are important to SAP coming up in this year. The Office of the CFO is certainly one, which is important for us. And secondly, their commitment to AI as well. The beautiful thing about both SAP and BlackLine is that we both have a great deal of data, which makes the usage of AI models much more effective. And so we're seeing that everybody's, in fact not just SAP, but really everybody is trying to figure out how to best deliver the benefits that we know are tangible to our customers. So we see that within SAP. We have discussions on that and that's certainly a high priority for BlackLine this year.

So operator, I know we've run a little bit over, so I just want to sort of close-up the meeting. I want to thank everybody for their participation today. Really appreciate it. Look forward to the follow-up conversations that I'm sure we'll have and appreciate your interest in BlackLine. And thank you. Everybody have a great rest of the day. Take care.

Ladies and gentlemen, that does conclude our conference for today. Thank you for your participation. You may now disconnect.