Maria Riley - Investor Relations Therese Tucker - Founder, Chief Executive Officer Mark Partin - Chief Financial Officer

Bhavan Suri - William Blair Brent Bracelin - KeyBanc Capital Brian Peterson - Raymond James Albert Chi - JP Morgan Rob Oliver - Baird Terry Tillman - SunTrust Pat Walravens - JMP Securities

Good afternoon and thank you for your participation today. With me on the call is Therese Tucker, Founder and 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, 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 conference call.

While we believe any forward-looking statements we have made are reasonable, actual results could differ materially because the statements are based on our current expectations and are subject to risks and uncertainties. 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, all financial measures discussed on this call will be non-GAAP. A discussion of why we use non-GAAP financial measures and a reconciliation schedule showing GAAP versus non-GAAP results is currently available in our press release, which may be found on our Investor Relations website at investors.blackline.com or on our Form 8-K filed with the SEC today.

Now I will turn the call over to Therese to begin.

Good afternoon everyone and happy New Year, and thank you for joining us today. I'm very pleased with the progress that we made on our initiatives in Q4 and 2017.

It was a strong finish to a good year and we were able to accomplish much of what we set out to do in the year. I'm proud of our employees and their tremendous efforts in 2017 and as I look back on the year I feel good about what we have achieved.

I would like to share with you a few key highlights. We achieved 40% revenue growth for the quarter with positive net income and positive free cash flow.

For the full year 2017, revenue grew 43% and we managed the business near breakeven for the full year. We added 117 enterprise and mid market customers from broad and diverse industries across the globe.

I'm pleased to report that we now serve over 2,200 customers globally. We continued our trend of land in larger initial deals and in Q4 we closed the largest new core platform deal in company history.

This is the fourth quarter out of the last six where we have seen that trend. We saw a good success in the quality, strength and closure rates of our pipeline in the second half of the year, thanks to our rebalancing efforts.

Bringing two new products to market is challenging and we feel that we are in a better position with the right attention and resources to meet core demands while still pursuing opportunities for our strategic products. We had a very good quarter for strategic products.

We have been working hard to convert the strong demand for these products in the closed deals and we saw good progress in Q4 for sales of both the Intercompany Hub and Smart Close. It is still early and a relatively small number of deals but I'm encouraged at our success in partnership, pricing and packaging is moving the ball forward.

We were also very pleased to be recognized as a best place to work as our employees what make us BlackLine. We were named by Fortune Magazine as the number three best place to work in Southern California, and also number 24 on Fortune's List of The 100 Best Medium Work Places in the U.S.

While on that topic, I would like to welcome new member to the BlackLine team. This afternoon we announced the appointment of Marc Huffman, as Chief Operating Officer.

Marc joins us from Oracle and NetSuite and has an exceptional track record of rapidly scaling global software sales team. In his tenure at a sizeable SaaS accounting software company, he saw sales grow from $3 million to over $1 billion.

In Marc's new role he will be responsible for leading BlackLine's worldwide go-to-market and customer facing activities. We believe that he is a strong addition to our leadership team and we are so excited to have him join BlackLine.

Another announcement that we made today is a formal strategic alliance with E&Y. We have had a great long standing go-to-market relationship with E&Y for many years and our strategic alliance extends our ongoing collaboration to help enterprises worldwide achieve successful financial transformation through BlackLine implementation.

This is a fantastic achievement to kick up the year and we already have eight joint marketing events planned for Q1 alone. And finally during the quarter, we hosted our InTheBlack Conference, which we rebranded as a finance and innovation summit.

This was our largest user conference to-date and the first year that we stream the event live, which enabled us to bring our vision and thought leadership to even more accounts and finance professionals around the world. It was great to see so many of our customers' prospects and partners at the conference.

Many of you were there and I thank you for taking the time to come and to learn more about BlackLine. We have received overwhelming feedback that reinforced some key themes.

Namely our though leadership in continues accounting and disruptive new technologies such as process automation and machine learning is resonating with our customers. It is great to see the BlackLine has increasingly been recognized as a voice at the forefront of a changing industry.

Secondly, they are enthusiastic about our product direction and third they are appreciative of our laser focus on their needs. We value the relationship that we have with our customers and partners and the feelings are mutual.

In addition to the highlights I shared for the quarter, I wanted to talk a little bit about the progress that we made on our five key initiatives for 2017. We shared these initiatives with you at the beginning of the year and they've done key building blocks of our long-term growth strategy.

First and foremost has been our focus on enhancing the customer journey. We've provided many data points during the year on this topic, including investing and customer success leadership, we're aligning customer ownership, reducing the time to go live by half, building higher product engagement and many other areas to keep our customers-centric culture.

As a result of our consistent focus, we're building long lasting relationships with our customers, driving sales for our core platform and uncovering new opportunities with our strategic products. A few fourth quarter customer engagements that highlight our growing momentum included.

A fortune 500 technology company that has recently made a large acquisition and shows BlackLine's core platform to help them standardize and modernize their global accounting practices. The key attributes of our platform that resonated with them most were unified cloud platform and its ability to scale across multiple entities and geographies along with the automation and completeness of our journals product.

This company is coming to BlackLine after utilizing a computing product. Our core platform was also chosen by a fortune 50 retail company that was looking to provide visibility into key financial processes and decrease risk by enforcing control.

The BlackLine platform is helping there accounting leadership a key vision for a centralized highly secure platform to manage all aspects of the financial close and operate a completely transparent process providing global audit ability and management. FYI this is also a switch.

This next customer is a great expansion story with one of the world's largest biotech company, after being a loyal BlackLine customer for 10 years this customer is adopting our Intercompany Hub and journals products. This highly acquisitive customer has multiple ERP system and our unique ability to seamlessly interface with many different systems with a key factor in their decision.

There long-term vision is to leverage a single intercompany solution that is used globally. Our other 2017 initiatives included and expanded go to market approach, selling more strategic products, perusing larger initial deal sizes and enhancing our platform and existing products to evolve with customer needs.

In each case we invested a plan, higher than train the teams and scale the organizations accordingly. We delivered tangible results in 2017 and made solid progress towards our longer term goal, the pursuits of these initiatives helped us deliver on our promise to our customers and exit the year with strong momentum.

Once again in 2018 we will share with you our key initiatives for the year that we believe will extend our success and be the building blocks for a long-term growth strategy. Taking care of our customers is number one.

We want our customers to have the best user experience that they possibly can with BlackLine. We are striving to build a model that balances lavish customer support with commercial viability.

Last year, we took a team approach to managing our customer relationships and we will build on this in 2018. We will also continue to invest in our customer success team, which helps ensure customers adopt our full speed of products.

Delivering great software continues to also be a high priority in 2018. One of the benefits of having a large customer base of over 2,200 customers is a lot of insight into what our customers really need.

We will continue to add the enhancements that make our customers lives easier. We are also focused on improved quality and performance.

For example, we plan to deliver advanced multicurrency functionality, greater automation around software maintenance and administration, enhancements to our task management and transaction matching products and strengthen our interconnectivity. We will also invest development time and effort on the Intercompany Hub, focusing on supporting performance as usage, scales up.

We believe that these key product initiatives evolves that other items on our roadmap will help us to deliver long-term sustainable customer value. We have expanded our partner ecosystem and have now signed formal alliances with E&Y, Deloitte and KPMG, but this is just the beginning.

We're at the start of the digital transformation wave in our industry, and many consulting companies are excited about the opportunity to help their clients fill with this disruption. We have owned an increasing number of partner influence fields in the last four quarters and BlackLine is often at the core of a much larger engagement.

We are excited about our growing partner ecosystem and this is an area where we will continue to invest. As part of our growth initiatives, we will continue to hire and scale our direct sales teams where we see the greatest enhanced across both large enterprises and mid-market sectors and globally in the major markets where we currently focus.

We believe that there is a large total addressable market that remains largely on penetrated and our sales people are critical in educating companies on our products and building long lasting relationships. We believe the market is largest today for our core platforms and in 2018, it will be important for us to balance the growing interest and in the Intercompany Hub and Smart Close with the large market opportunity for our core products.

Our newly formed partnerships can help us to expand the strategic product footprint and our customers for the sales and implementation cycles are longer and more complex. Lastly, as we grow in scale, it is important to me that we've maintained our people centric culture.

I want BlackLine to continue to be a great place to work and I want the people that work here to continue to grow and learn and advance their careers. We operate globally with a rapidly expanding team of employees and we want to make sure that our culture is retained by every one of them.

In closing, the demand environment and the fundamentals of the business remained strong and consistent. In Q4, we are seeing tremendous enthusiasms for BlackLine’s product and vision with our customers and partners.

Now, I’ll turn the call over to Mark to discuss the financials.

Thanks, Therese, and good afternoon everyone. As a quick reminder, all numbers mentioned during my remarks today are non-GAAP.

Additionally, while we ended fiscal year ’17 on the historical revenue accounting standard, ASC 605 as required, we have adopted the new revenue standard, ASC 606 affective January 1, 2018. So I’ll discuss our Q4 and full year 2017 results on this call according to the historical revenue recognition standard, ASC 605, but we’ll provide forward-looking guidance according to the new standard.

We do not expect the new standard to have a material impact to our revenue results, but it will benefit our earnings going forward at ASC 606 requires capitalization of certain sales commission. We will publish a full retrospective for comparison purposes in Q1.

Moving to our results. For the full year 2017, total non-GAAP revenue grew 43% to $177 million.

Gross margins were consisted at 81% and we delivered steady improvement in our operating loss margin moving from a loss of 10% to 2% of revenue. Additionally, we generated over 6 million in cash from operation.

We delivered a strong fourth quarter achieving better than expected revenue and bottom-line results. Additionally, I’m pleased to announce that we will portfolio and free cash flow positive in the quarter, which had been our stated goal since our IPO in 2016.

Total fourth quarter non-GAAP revenue grew 40% year-over-year to reach $50 million, driven by continued strong global demand for our solutions. Many factors contributed to our better than expected top-line results including accelerated deal time larger deal sizes, a pick-up and strategic product and strength once again in our European market.

Key financial highlights include the following. We added 117 net new customers globally across both enterprise and mid-market.

This brings our total customer count to 2,228 at December 31st representing 26% growth year-over-year. International revenue continued to grow nicely, representing 22% of the total, up from 18% in the fourth quarter of 2016.

The total number of BlackLine users grew to approximately 197,000 representing 18% growth year-over-year. As we have discuss previously growing sales of our strategic products by Transaction Matching, Smart Close and Intercompany Hub increased our overall deal sizes, but do not add users and impact this metric.

Our dollar base net revenue retention rate was 112%, which was in line with our expectations. Looking into 2018, we expect this rate to be closer to a range of 108% to 110% while we have been pleased with our ability to grow our initial deal sizes over the past year.

It does have trade off to our expansion model and may impact our net account growth in the near-term. Importantly, the underlying renewal rates remain high in Q4 and we expect to see this high level of stickiness continue in 2018 with our existing customers.

Now returning to the P&L, our revenue mix of 95% subscription and 5% services continue to drive consistently high-growth margins in 2017 and it reached just over 82% in Q4. In 2018 we anticipate gross margins will trend more towards our target model of approximately 80% as we continue to build our services and support team.

In 2017 we saw a rapidly improving operating leverage across all areas of the business, as our operating expenses decreased to 83% of revenue down from 91% in 2016. We are pleased with this progress in 2017 toward our long-term target model, even as we continue to invest across the business and growing our direct sales team globally, enhancing our software platform and increasing our customer engagement initiatives.

Going forward we expect to gain overall operating leverage on an annual basis toward our long-term model. Timing of certain investments can cause our non-GAAP net income and cash flow to fluctuate on a quarterly basis.

In Q4 we reported net income of $1.8 million or $0.3 on a per share basis using 55.9 million shares. This compares to a net loss of $3.9 million or $0.08 per share using 48 million shares in Q4 of last year.

We ended the fourth quarter with approximately $113 million of cash and cash equivalents and marketable securities. We generated approximately $3 million in cash from operations.

We invested just under $3 million in CapEx and completed the build out of our expanded corporate office space under budget and on time, which brings our free cash flow for the quarter to approximately $1 million. Now I'll turn to our guidance for the first quarter and full-year 2018, which is I mentioned previously is based on the new ASC 606 standard.

Starting with Q1 total GAAP revenue is expected to be in the range of 49.5 million have to $50.5 million. This reflects a year-over-year growth rate of 28% to 31% compared to the first quarter of 2017.

On the bottom line, we expect non-GAAP net loss to be in the range of 1.1 million to $2.1 million. Utilizing weighted-average shares of 53.2 million, we expect non-GAAP net loss per share in the range of $0.02 to $0.04.

Turning to our outlook for the full-year 2018 year, total GAAP revenue is expected to be in the range of $219 million to $224 million. This reflects a growth rate of 24% to 27% over last year.

Non-GAAP net income in 2018 is expected to be in the range of breakeven to $1 million. Utilizing diluted weighted-average shares of 56.9 million we expect non-GAAP net income per share between breakeven and $0.02.

And lastly we expect to be free cash flow positive for the full-year. Now, Therese, and I would be happy to take your questions.

I guess I want to dive in first on the strategic partnership announced and you announced a couple and you announced one obviously at the user conference, you had one with another large Global 4 SI accounting shop before, as you see sort of those relationships mature, I don’t understand sort of what sort of inbound activity they driving for you. Both in the core reconciliation offering, I mean also on a more strategic offerings.

Just in terms of sort of how are those developing and sort of they obviously will be valuable in time, but you're starting to see some of the fruits bare today or in the pipeline at least show up in the pipeline?

Bhavan, that’s a great question. One of the things that I mentioned today is that already in Q1.

We've got eight marketing events set up with E&Y, actually learned a few minutes ago that it's actually nine. Okay, now when we are able to do marketing events with our partners there is a couple of things that happen.

They will typically spread the word out to their customers, their relationship and we do as well, right. And then that collaboration together usually will add a customer and mix as well.

But that collaboration together is a very potent combination to people that is actually thinking about how they can run there finance and accounting better. And so, it might be via a webinar, it might be via a certain in person events.

But them tap into their network while we tap in to ours has really helped us in building our pipeline, and I think one of the other things we did mentioned is it in Q4, 9 out of 10 is the largest deals, where actually we were working with partners on. So we're seeing the fruit of that and I think that there is -- I think there is still a lot more that we can do.

Great and then a quick follow-up obviously, congrats on having Marc joined too. I think a great additional compliment to your team.

But I would love to sort of understand obviously, there has been a process while and now he's one board. Just how is he and how you guys thinking about potential changes to sales territory, sales team?

Has he thought about sort of restructuring or is he going to run status quo for little while? How is that sort of playing out maybe near-term but also more important sort of longer term?

Bhavan, the thing that I like a lot about Marc is, it is a very measured individual and I think sort of the Marc somebody who is an experienced executive, is if they come in, they would evaluate, they look for where things can be improved but they don’t do anything stupid or off the cup. And I would anticipate that Marc would follow that pattern.

One for Therese and one for Mark, if I could. Therese, let's start on the product footprints side, you talked about expanding that obviously you did that this year, now you have a even growing number of partners talking about expanding it further.

Walk you through the philosophy on new product introductions and launches? And how you're balancing that both internally?

And then externally you also evaluating potential add on kind of acquisitions to help augment your internal efforts?

Thanks Bren, let’s see. So we went through a process last year where we kind got out of balance, right we focus too much strategic products and in some cases the markets were just not mature.

So around the less part of the year, I think we got much better at rebalancing and that’s really sort of a terrific lessons learned for us that our core market is massive, all right. Our largest feel today is core platform only.

Largest initial deal today is core platform only, all right. So we as a company are not going to make the mistake of forgetting again that our core market is huge and that we should focus most of our effort on that area.

Now that being said, I always have to temper my enthusiasm for some our strategic products, especially when we had a very nice quarter like we did in Q4. So I think that their contribution in 2018 will continue to grow, but I'll let Mark speak to numbers of our math because he would tell me if I do.

But I think, yes, you have a question for me as well Brent.

Exactly, let's start with the revenue guide for '18 Mark, I'm obviously it's encouraging to hear Therese talk about focusing on the core I would tend to agree that a big, big large opportunity out there just in the core business encouraging by the largest deal in the company's history as she coming from the core as well. But if I just apply historical revenue retention rates it does look like there's a healthy dose of conservatism to the 2018 revenue growth guide and I was just trying to understand is this excludes the contribution of large deals which are I know difficult to predict on the timing side that just bake in a more material slowdown on pro services as you ramp up some of these partners just trying to understand the level of conservatism around the guide for 2018 and how should we be thinking about the growth profile this business in the '19?

So let me start by saying that we were actually really pleased with the Q4 result and that momentum that we saw on the initiatives. Having said that, our philosophy for guide on revenue haven't changed, I wouldn't say conservatives Brent I would say that we have a prudent approach to guidance we want to guide in range that we feel confident that we can execute on.

And at this point early in the year we believe that that growth range with the midpoint of around 25% is the right one, it's appropriate for us now. Now, there is a couple of questions I think you tapered in there.

So first is around the balance, our view is that what we saw last year in terms of contribution with the core and strategic products we would like to maintain somewhere over around or over 80% of growth this year coming from core and the remainder coming from the strategic product. So you can see that they the majority coming from core and that’s the right balance and we think in '18 and that also that in order to be in that range we need to execute and continue to do so on these strategic products.

I'll also add that as Therese mentioned we are investing in this large market where we are doing what we think is the right thing for the long term. We are investing in these ecosystems and the new products and the sales expansion just to name a few and if we focus on those in '18 focus on the long term the rest will take care of itself.

Last one for me Mark on just billings if I exclude the differed revenue contribution from Runbook last year, it does look like billings growth reaccelerate here in Q4. Was that just seasonality contributions of large deals?

What drove that we reacceleration in calculated billings growth adjusted for rent book?

Yes, you are absolutely right. We are -- without the Runbook one-time headwind it's 42% 43% did reaccelerate.

We were pleased with that. That came from a variety of things you know we land and we lead larger deal and those strategic deals that we talk about in Q2 and we were able to move those forward with all the effort from the team.

We saw some good deal activity in Europe once again, which is been a nice trend for us. And so a combination of those things really led to a good quarter.

So I wanted to get on the partner deal. So you mentioned 9 of the largest 10 deals this quarter were partnering influenced.

Any help on how much the bookings or the revenue overall come from partners. And as they maybe become a bigger part of the go-to-market motion, how should we think about cadence of bookings or deal sizes?

Anything you can help with there?

I think first part of that question, thanks for that. So what I can say over the last four or five quarters the acceleration of partner deals where we have the assistance or partners or they’ve going to part of it has really accelerated.

And we use to give number, it’s kind of generally in the 30%, 40%, we’ve now gone past that close to half of the deals in Q4 where partner assisted or partners with us. And you heard that 90% of the top deal, it’s a big deal, where I think really a lot of value for us they were there for 90% of those.

And maybe, Mark, another high level on for you, but it’s interesting out at the user conference. A lot of your customers talk about the additional models that they purchased overtime.

I’m just curious, if you look at your customer based broadly and said that they have this amount of products today. How penetrated are we across the customer base into what that potential would be overtime?

It’s a great question. I remember this from the Analyst Day and when we talk about product, it’s between one into -- I think that’s what is purchase, that’s what being used and that’s on the core platform that has fixed, and that’s not to mentioned that we have such small uptake and we’re still early in the strategic products like ICH and Smart Close.

When you add those in, we believe that the penetration within the account is obviously nascent early.

This is Albert Chi on for Mark Murphy. So it sounds like a lot of companies have started to get over the hump of adopting ASC 606, which sounds like it’s taken a lot of focus away from the accounting department.

I wanted to ask, when do you think is the time when companies are going to start paying a little bit more attention to, for buyers start looking at account, accounting-type solutions, BlackLine-type solutions?

Yes, great question. We also talk about that at the Analyst Day.

I think it’s a time we said the same thing and I can tell now. It is really hard for us to draw straight line between that level of effort and that regulation even though it’s massive to any particular sort of climate of buying.

So we know it’s on CFO’s minds, we know that accounting departments are struggling with it. We’ve been working and putting a ton of our own effort into it for ourselves.

So I wouldn’t and we don’t expect or model any particular headwind or tailwind from this

And my last question is really around robotic process automation and maybe something you touched on also from the Analyst Day, but when you look at areas of accounting that are right for RPA, what would you say they are? And when you look at your customers, who it sounds like they built lot of internal solutions what sort of perhaps they are unsustainable, and maybe you could talk a little bit about that?

Yes, RPA is, I’ll take this on Mark. RPA is a super interesting area and there are sort of different ways to approach that.

We have had some of our customer take an approach where they simply do the equivalent of recording macro key strokes. The difficulty was sort of that very, very low level automation of a process is it's the old adage garbage in, garbage out, all right.

However, if you look at our Smart Close product, that is the epitome of intelligent RPA. It's actually taking the processes that companies run, month after month, quarter after quarter, year after year like typically, manually inside of their ERP and automating those processes.

I had a Fortune 50 customer tell me that, it used to take them a week or more to do a single entity close. They were able to do it in 15 minutes with the Smart Close product.

So there are different approaches to RPA. I think that the kind of RPA that’s been implemented with our BlackLine Smart Close product is precisely the kind of company should be focusing on.

So two quick questions, hey, Mark. First for you, Therese, and then a quick follow up for Mark.

Therese, you hinted in this might be more my interpretation, but you hinted at the Analyst Day that you guys might be sort of rethinking the large ICH-type deals and may be starting to break those apart a little bit, not to draw attention away from the strong performance and the core. But, you guys did sign ICH deal this quarter, which you've cited in your prepared remarks, and I just wanted to ask.

If in fact you guys were thinking about the go-to-market and ICH a little bit differently and maybe trying to get away from a much larger clearly more participatory type of sale where you need to get a lot more body to sign off on it and rather going to maybe something a little bit smaller that might help drive adoption?

By the way Rob, we had multiple ICH deals in this quarter just saying. Yes, I know.

Okay, so I think there is three areas for ICH that have helped us get momentum, we call them the three P, packaging, pricing and partners okay and packaging is a bit of how we've approach so that people can adopt a more phased approach. The pricing takes into account the size of the organization and then of course the partner network has been very, very helpful and influential on the sales process for ICH deals.

So those three together I think are the fine tuning that we done there is definitely going in the right direction.

Great that’s helpful color. And then Mark, I apologies if I miss this.

In the past I think you've mentioned clearly in our work we picked up that partnerships have been a real key focus for you guys and partners want to get closer to you. I think you have broken out the SAP portion of that in the past that I'm not sure you did this quarter or maybe I missed it, I apologize if you want to break that out.

Yes, you bet. Thanks for that, you did not miss it I didn’t say it, its 20% for SAP and in the fourth quarter and that's up from a year ago 18%, and as you saw through the year it picks up about a point to quarter.

A lot of questions have been answered, but don’t worry I still have a lot more questions.

I know I would be disappointed if you didn’t.

No, we need seven from you I think was your original first quarter.

But in terms of -- it does sound very positive in terms of just all the partner influencing and the ecosystem build out. Does that change any of your strategic thinking or multiyear planning in terms of sales capacity whether its enterprise or the mid market or international?

Does it change the pace of hiring you have to do because you do get some help from third parties? Or does it really not have an impact on how you are thinking about your sales capacity growth?

I don’t think it has an impact Terry and here is why, because even though we really appreciate the influence and the wealth of knowledge that our partners bring to the process there is still a process and we still have to work through that. So there is still very much a sales force that’s involved.

I think our scaling and our plan has taken into account the partnerships that we are building.

Yes, that’s right, I'll just add to that too is that our strategic velocity has been teaming around the sales person as we get into strategic and into large deals. So it doesn’t change the fact that we need them they just need more resources they need customer engagement people they need the partners to get these larger and more complex cycles done.

And Mark since I've got you there, in term of free cash flow you've committed previously to be free cash flow positive. It is good to see in the quarter, but you said you would be free cash flow positive for the full year 18.

Is that also where you will be free cash flow positive each quarter of the year? And is there anything about seasonality we should think about on how we make sure our models are accurate?

Great question because we still do see some I wouldn’t say it's seasonality it's more business specific things that occur through the quarter. So for example in Q1 where we have a corporate bonus in Q4 where we have a large conference or things like that that can move it.

So our cash flow by quarter in '18 will be similar to what we thought in '17, it will drive upward through the year. I also want to say I'm going to insert just here.

I know it wasn’t your question, but I want to talk a bit about ASC 606 as well because this is having an impact for people, if they are thinking about their models. And for us our guidance for Q1 in 2018 is based on the new standards.

It does not have a meaningful impact on the revenue that we have given. But it does benefit us on the earnings going forward because it requires us to capitalize more sales commissions.

And we are still working on that. We will have more details out in our next filings, but at a high-level we expect the impact to be around $5 million to $7 million of an expense benefit in 2018 and then something very similar in 2017.

And then that’s approximately a $1 million to $2 million benefit in just Q1 of 2018. So it’s important to keep that in mind as we go into ’18 as well that's how we’ve guided.

But Mark is that just -- is that an income statement dynamic with the sales and marketing and capitalizing? Or is there also a cash flow dynamic?

It doesn’t change cash flow because we’re still paying the commission.

So, with all that Therese, what’s your top priority for 2018?

Always the customer journey making sure that our customers are using and getting value from what they’re buying from us, and making sure that we continue to expand our relationships there. Now I would say on the next couple Pat, it’s, Mark and I might be slightly different.

I’m always sort of interested in what we’re doing with the product. And I think Mark really likes the things that we’re doing with the partner ecosystem and scaling the sales.

And of course, I am again really focused on the people and the culture that we have here. So, we’ve got -- there might be some small differences between us, but we’ve sort of manage to work it out.

Okay. Well, this is Therese and I want to thank all of you for your ongoing support and especially your evangelism of BlackLine.

It continues to bring us new referrals and customers. Please keep it up.

We look forward to sharing our success with you in 2018 and beyond. Thank you.

Thank you.