Blackline Safety Q4 Earnings Call Highlights

Blackline Safety (TSE:BLN) reported record fourth-quarter and full-year fiscal 2025 results, highlighting continued growth in recurring revenue and another quarter of positive adjusted profitability. Management also detailed the upcoming launch of its next-generation G8 wearable safety device, which the company expects to begin shipping in late February 2026.

Record revenue and another quarter of positive adjusted EBITDA

CEO and Chair Cody Slater said the company delivered “another strong quarter” and capped a record fiscal year, pointing to record annual recurring revenue (ARR), “strong net dollar retention,” and a sixth consecutive quarter of positive adjusted EBITDA.

For the fourth quarter ended October 31, 2025, Blackline reported record revenue of CAD 39.3 million, marking its 35th consecutive quarter of year-over-year top-line growth. Adjusted EBITDA was CAD 2.2 million in Q4.

For the full fiscal year, revenue reached CAD 150.5 million, an all-time high. Adjusted EBITDA for fiscal 2025 was CAD 6.1 million, compared with an adjusted EBITDA loss of CAD 2.4 million in fiscal 2024, which management framed as evidence of the company’s ability to generate full-year positive adjusted EBITDA.

Recurring revenue expands as services outpace products

CFO Robin Kooyman said fourth-quarter revenue increased 10% year-over-year, driven by service revenue growth. Q4 service revenue rose 30% to CAD 25.5 million, including:

• Software services revenue up 26% to CAD 21.5 million
• Rental revenue up 55% to CAD 4.0 million, reflecting demand tied to industrial turnarounds, maintenance, and project-based environments

Product revenue in Q4 was CAD 13.8 million, down 14% year-over-year. Kooyman attributed the decline to customer caution around capital purchases amid global trade and macroeconomic uncertainty, the U.S. government shutdown, and delays in certain customer hardware refresh activity.

ARR at year-end reached a record CAD 84.5 million, up “almost 30%” versus the prior year, providing what Slater described as improved visibility and a foundation for future growth.

Net dollar retention was 128% in the fourth quarter. Slater noted that retention has been above 125% for 10 consecutive quarters, reflecting expansion within the existing customer base as customers add devices and services.

Margins improve, with record service margin

Kooyman reported fourth-quarter gross profit of CAD 26.3 million, up 21% year-over-year, as gross margin improved to 67% from 61% a year earlier. Service margins were a standout: service gross margin reached a record 82%, which management attributed to scale efficiencies and optimized connectivity and infrastructure costs.

Product margins improved as well, with product margin rebounding to 40% from 35% in Q3. On the call, management said product gross margin can vary based on factors such as factory utilization and inventory dynamics, including inventory build for the G8 launch.

Operating expenses in Q4 represented 68% of revenue, excluding a one-time charge in G&A and foreign exchange. The one-time item related to a U.S. sales tax assessment for prior periods. For the quarter, EBITDA was CAD 1.4 million and adjusted EBITDA was CAD 2.2 million.

For fiscal 2025, Kooyman said gross margin improved to 63% from 58% in fiscal 2024, driven by revenue mix, pricing discipline, and operating leverage. Full-year service revenue increased 30% to CAD 90.5 million, while product revenue increased 4% to CAD 60.0 million.

ADNOC deployment scales and Middle East demand strengthens

Slater highlighted demand across the company’s product lineup, including EXO-8 area monitors and G7 and G6 wearables, with particular strength in the Middle East. He said the company’s long-term purchase agreement with ADNOC is beginning to scale.

Management said it delivered the initial 1,000 devices referenced in an August press release and deployed “almost 2,500 devices” in the fourth quarter. Later in the Q&A, Slater clarified that 2,500 devices had been shipped as of Q4 under the ADNOC relationship, describing them as body-worn devices (a mix of G7s and G6s), excluding beacons. Slater reiterated that the agreement “could see up to 28,000 devices deployed,” and said the figure is “validated directly with ADNOC.” He estimated rollout over “about the next two years,” with deployments progressing by operating unit and plant and including software integrations.

Management also said Middle East growth will be supported by a previously announced international office in the U.A.E. intended to provide localized training, rentals, and service.

G8 launch timing, transition expectations, and near-term headwinds

Blackline announced the G8 connected safety wearable during the week of the call. Slater described it as the company’s “most advanced product” to date, combining gas detection, lone worker protection, and real-time communication, connected through Blackline Live. He said the company is taking orders now, with first commercial shipments expected to begin in February 2026.

During Q&A, President and Chief Growth Officer Sean Stinson said Blackline anticipates a “roughly two- to three-quarter transition” from G7 to G8, noting that some customers with tightly budgeted G7 deployments may initially stay with G7. He added that G8 hardware will be priced “a little bit higher.” Slater said the company expects to largely shift production from G7 to G8 over the next three quarters and be “fully G8” by the end of the fiscal year, while still supporting G7 customers with nominal manufacturing for years.

Management said it expects some timing impact around the product changeover. Slater said the G8 announcement has pushed some near-term business into later periods, potentially creating “a bit of a headwind in Q1,” with expected strength flowing from Q2 onward. The company also discussed broader headwinds that affected product revenue in Q4, including global trade uncertainty, macroeconomic conditions impacting energy and industrial customers, and the U.S. government shutdown, which management said disrupted funding and slowed purchases among fire and hazmat customers. Slater said those orders were delayed and characterized the fire and hazmat pipeline as “single-digit millions” on the low end for what would have been expected in Q4, with demand expected to come through Q2 and Q3.

Kooyman said Blackline ended fiscal 2025 with CAD 46.6 million in cash and short-term investments and total available liquidity of CAD 76.4 million, including capacity on its senior-secured operating facility and accordion feature.

Separately, Kooyman said she will temporarily step away for maternity leave effective February 2, with VP Finance and Accounting Chris Curry serving as interim CFO.

About Blackline Safety (TSE:BLN)

Blackline Safety Corp is a connected safety monitoring technology company. It provides wearable safety technology, personal and area gas monitoring, cloud-connected software and data analytics to meet demanding safety challenges and increase productivity of organizations with coverage in more than 100 countries. Blackline Safety wearables provide a lifeline to tens of thousands of people, having reported over 161 billion data-points and initiated over five million emergency responses. Armed with cellular and satellite connectivity, the company ensure that help is never too far away.