Blackline Safety (BLN) Q2 2025 earnings summary

Executive summary

• Achieved record Q2 revenue of CAD 35.9 million, up 14% year-over-year, marking 33 consecutive quarters of growth.

• Adjusted EBITDA reached CAD 1 million, a turnaround from a CAD 2 million loss last year, and was positive for the fourth consecutive quarter.

• Annual recurring revenue rose 33% year-over-year to CAD 75.2 million, driven by strong customer retention and new client wins.

• Net dollar retention remained high at 128% for the eighth consecutive quarter.

• Shipped first units of EXO 8 Gamma area monitor, expanding product portfolio.

Financial highlights

• Service revenue increased 31% year-over-year to CAD 21.9 million, while product revenue declined 5% to CAD 14.1 million due to geopolitical and trade uncertainties.

• Gross profit hit an all-time high of CAD 22.7 million, up 26% year-over-year, with record gross margins of 63%.

• Service gross margin reached a record 79%; product gross margin was 39%.

• Net loss narrowed to CAD 3.7 million, a 13% improvement from Q2 last year.

• Cash and short-term investments totaled CAD 52.6 million, up 22% from year-end fiscal 2024.

Outlook and guidance

• Targeting positive adjusted EBITDA for fiscal 2025, supported by strong first-half performance.

• Most products are USMCA compliant and exempt from current US tariffs, supporting US expansion.

• Expecting continued volatility in product revenue due to ongoing trade policy uncertainty and macroeconomic factors.

• Gross margin on product targeted at 40% for the year, with potential to move into the mid-40% range in the longer term.

• Strategic investments in manufacturing, sales, and marketing to drive growth, especially in high-margin service revenue.