Company: BL
Filing Date: 2025-02-21
Form Type: 10-K
Source: 0001666134-25-000003
Chunk: 163

Company: BLACKLINE, INC.
Filing Date: 2025-02-21
Form: 10-K
Item: Item 8
Chunk 163
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 of its federal net operating loss carryforward during 2024, and the Company’s projections of future pre-tax income. Based on available objective evidence, the Company has recorded a valuation allowance against certain foreign deferred tax assets at December 31, 2024.The changes in the valuation allowance were as follows (in thousands):Year Ended December 31,202420232022Valuation allowance, at beginning of year$92,079 $99,476 $32,279 Increase (decrease) in valuation allowance recorded through earnings(87,402)(7,063)2,880 Increase (decrease) in valuation allowance recorded through equity— (334)64,317 Valuation allowance, at end of year$4,677 $92,079 $99,476 The decrease in valuation allowance recorded through equity of $0.3 million during the year ended December 31, 2023 is related to unrealized gains reported in other comprehensive income. The increase in valuation allowance recorded through equity of $64.3 million during the year ended December 31, 2022 resulted from the adoption of ASU 2020-06, which required the reversal of deferred tax liabilities associated with the Company’s 2024 and 2026 Notes. The decrease in valuation allowance recorded through earnings of $87.4 million during the year ended December 31, 2024 resulted primarily from the release of valuation allowance previously recorded against its U.S. deferred tax assets, partially offset by an increase in valuation allowance recorded against certain foreign deferred tax assets. The decrease in valuation allowance recorded through earnings of $7.1 million for the year ended December 31, 2023 resulted primarily from the utilization of federal and state net operating loss carryforwards due 

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to domestic profitability, along with the valuation allowance decrease associated with net deferred tax liabilities from the DI Acquisition, which are a source of taxable income to support the recognition of existing UK deferred tax assets. The valuation allowance release resulted in a UK deferred tax benefit of $1.7 million for the year ended December 31, 2023. The increase in valuation allowance recorded through earnings of $2.9 million for the year ended December 31, 2022 resulted primarily from the effects of the capitalization and amortization of research and development expenses as required by the 2017 Tax Cuts and Job Act, partially offset by the valuation allowance decrease associated with net deferred tax liabilities acquired from FourQ