BLACKLINE, INC.BL
BLACKLINE, INC. Stock Compensation Disclosure
Stockholders’ Equity
Common Stock Repurchases
On November 17, 2024, the Company's Board authorized the repurchase of up to $200 million of the Company’s common stock. On September 4, 2025, the Board approved an increase to the Company’s stock buyback program of an additional $200 million, for a total overall authorization to repurchase up to $400 million of the Company’s common stock. The Board also approved the elimination of the expiration date of the program, which was previously set to expire on March 31, 2027.
The Company repurchased and retired 4.5 million shares of common stock for $235.5 million during the year ended December 31, 2025. At December 31, 2025, $164.5 million of buyback capacity remained under this program.
2016 and 2014 Equity Plans
The Company's principal equity compensation plan is the 2016 Equity Incentive Plan (the “2016 Plan”), adopted in November 2016. The 2016 Plan authorizes the grant of stock options and restricted stock units to the Company’s employees, directors, and consultants. It succeeded the 2014 Stock Incentive Plan (the “2014 Plan”) from which no new awards are granted, but whose terms continue to govern all outstanding awards previously granted thereunder.
Upon its adoption, the share reserve for the 2016 Plan was 6.2 million shares, supplemented by any shares subject to awards granted under the 2014 Plan that remained outstanding and unexercised following the termination of the 2014 Plan. The number of shares available for issuance under the 2016 Plan and the number of shares subject to outstanding options automatically adjusts for any changes in the Company’s outstanding common stock by reason of any recapitalization, spin-off, reorganization, reclassification, stock dividend, stock split, reverse stock split, or similar transaction. Stock options and restricted stock units generally vest over to four years and have contractual terms of ten years.
At December 31, 2025, 22.3 million shares were available for issuance under the 2016 Plan.
Stock options - service-only vesting conditions
The following table summarizes activity for awards that contain service-only vesting conditions:
| Shares | Weighted- Average Exercise Price | Weighted-Average Remaining Contractual Term | Aggregate Intrinsic Value | ||||||||||||||||||||
| (in thousands) | (in years) | (in thousands) | |||||||||||||||||||||
| Outstanding at December 31, 2024 | 1,237 | $ | 50.96 | 4.1 | $ | 18,242 | |||||||||||||||||
| Exercised | (258) | $ | 41.99 | ||||||||||||||||||||
| Forfeited/canceled | (233) | $ | 65.88 | ||||||||||||||||||||
| Outstanding at December 31, 2025 | 746 | $ | 49.41 | 3.0 | $ | 9,216 | |||||||||||||||||
| Exercisable at December 31, 2025 | 746 | $ | 49.41 | ||||||||||||||||||||
There were no stock options granted during the years ended December 31, 2025, 2024, and 2023. The aggregate intrinsic value of options exercised that contain service only vesting conditions during the years ended December 31, 2025, 2024, and 2023 was $2.7 million, $14.3 million, and $15.2 million, respectively. Cash received from the exercise of stock options for the years ended December 31, 2025, 2024, and 2023 was $5.2 million, $7.6 million, and $19.8 million, respectively.
Unrecognized compensation expense relating to stock options that contain service only vesting conditions was zero at December 31, 2025.
Restricted stock units - service-only vesting conditions
The following table summarizes activity for restricted stock units that contain service-only vesting conditions:
| Restricted Stock Units | Weighted-Average Grant Date Fair Value | ||||||||||
| (in thousands) | |||||||||||
Nonvested at December 31, 2024 | 2,811 | $ | 64.40 | ||||||||
| Granted | 2,182 | $ | 50.10 | ||||||||
| Vested | (1,163) | $ | 65.86 | ||||||||
| Forfeited/canceled | (563) | $ | 60.72 | ||||||||
Nonvested at December 31, 2025 | 3,267 | $ | 54.97 | ||||||||
At December 31, 2025, the intrinsic value of service-based nonvested restricted stock units was $180.6 million. At December 31, 2025, total unrecognized compensation cost related to nonvested restricted stock units was $153.9 million and was expected to be recognized over a weighted-average period of 2.7 years.
Restricted stock units - performance and service conditions
Grants of performance and service-based restricted stock units vest over a three-year period. The total fair value of the grants made during the year ended December 31, 2025 was $12.7 million.
The following table summarizes activity for restricted stock units with performance and service vesting conditions with grant dates:
| Restricted Stock Units | Weighted-Average Grant Date Fair Value | ||||||||||
| (in thousands) | |||||||||||
Nonvested at December 31, 2024 | 198 | $ | 60.51 | ||||||||
| Granted | 248 | $ | 51.16 | ||||||||
| Performance adjustment | (97) | $ | 62.54 | ||||||||
| Vested | (101) | $ | 58.57 | ||||||||
| Forfeited/canceled | (30) | $ | 51.94 | ||||||||
Nonvested at December 31, 2025 | 218 | $ | 51.06 | ||||||||
The following table summarizes activity for restricted stock units with performance and service vesting conditions with no grant dates established:
| Restricted Stock Units | Weighted-Average Grant Date Fair Value | ||||||||||
| (in thousands) | |||||||||||
Nonvested at December 31, 2024 | 244 | N/A | |||||||||
| Granted (legal grant with no grant date established) | 173 | N/A | |||||||||
| Granted (accounting grant date established) | (171) | N/A | |||||||||
| Forfeited/canceled | (11) | N/A | |||||||||
Nonvested at December 31, 2025 | 235 | N/A | |||||||||
At December 31, 2025, the intrinsic value of performance and service-based nonvested restricted stock units with established grant dates was $12.0 million. At December 31, 2025, total unrecognized compensation cost related to performance and service-based nonvested restricted stock units with established grant dates was $1.4 million and was expected to be recognized over a weighted-average period of 0.2 years.
At December 31, 2025, the intrinsic value of performance and service-based nonvested restricted stock units with no grant dates established was $13.0 million.
Restricted stock units - market and service conditions
Grants of market and service-based restricted stock units vest subject to the achievement of TSR relative to an industry index over a three-year period. The total fair value of the grants made during the year ended December 31, 2025 was $13.7 million.
The following table summarizes activity for restricted stock units with market and service-based conditions with grant dates:
| Restricted Stock Units | Weighted-Average Grant Date Fair Value | ||||||||||
| (in thousands) | |||||||||||
Nonvested at December 31, 2024 | 202 | $ | 93.89 | ||||||||
| Granted | 208 | $ | 66.13 | ||||||||
| Vested | — | N/A | |||||||||
| Forfeited/canceled | (33) | $ | 97.48 | ||||||||
Nonvested at December 31, 2025 | 377 | $ | 78.26 | ||||||||
The following table summarizes activity for restricted stock units with market and service-based conditions with no grant dates established:
| Restricted Stock Units | Weighted-Average Grant Date Fair Value | ||||||||||
| (in thousands) | |||||||||||
Nonvested at December 31, 2024 | — | N/A | |||||||||
| Granted | 19 | N/A | |||||||||
| Vested | — | N/A | |||||||||
| Forfeited/canceled | — | N/A | |||||||||
Nonvested at December 31, 2025 | 19 | N/A | |||||||||
At December 31, 2025, the intrinsic value of market and service-based nonvested restricted stock units was $20.8 million. At December 31, 2025, total unrecognized compensation cost related to market and service-based
nonvested restricted stock units was $16.4 million and was expected to be recognized over a weighted-average period of 1.8 years.
At December 31, 2025, the intrinsic value of market and service-based nonvested restricted stock units with no grant dates established was $1.1 million.
Employee Stock Purchase Plan
Under the Company’s 2018 Employee Stock Purchase Plan (“ESPP”), eligible employees are granted the right to purchase shares at the lower of 85% of the fair value of the stock at the time of grant or 85% of the fair value at the time of exercise. The right to purchase shares is granted twice yearly for six month offering periods in May and November and exercisable on or about the succeeding November and May, respectively, of each year. Under the ESPP, 0.4 million shares remained available for issuance at December 31, 2025. The Company recognized stock-based compensation expense related to the ESPP of $2.8 million, $3.2 million, and $3.3 million for the years ended December 31, 2025, 2024, and 2023, respectively.
The fair value of ESPP shares granted was estimated using the Black-Scholes option pricing model with the following weighted-average assumptions:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Risk-free interest rate | 3.6% - 4.2% | 4.4% - 5.4% | 4.5% - 5.4% | ||||||||||||||
| Expected term (in years) | 0.5 - 1 | 0.5 - 1 | 0.5 - 1 | ||||||||||||||
| Volatility | 29.5% - 45.1% | 33.4% - 41.5% | 39.8% - 58.5% | ||||||||||||||
At December 31, 2025, total unrecognized compensation cost related to the 2018 ESPP was $2.5 million and was expected to be recognized over a weighted-average period of approximately one year.
Stock-based compensation expense
Stock-based compensation expense recorded in the Company’s consolidated statements of operations was as follows (in thousands):
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Cost of revenues | $ | 13,497 | $ | 10,501 | $ | 10,342 | |||||||||||
| Sales and marketing | 27,238 | 25,428 | 24,152 | ||||||||||||||
| Research and development | 16,633 | 13,345 | 13,095 | ||||||||||||||
| General and administrative | 35,222 | 33,977 | 30,381 | ||||||||||||||
| $ | 92,590 | $ | 83,251 | $ | 77,970 | ||||||||||||
Stock-based compensation capitalized as an asset was $4.7 million, $4.5 million, and $3.5 million during the years ended December 31, 2025, 2024, and 2023, respectively.
The Company recorded $0.7 million and $0.8 million of foreign tax provisions attributable to equity awards for the years ended December 31, 2025 and 2024, respectively, and $0.1 million of foreign tax benefits attributable to equity awards for the year ended December 31, 2023, respectively.
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About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.