Blackbaud Announces 2025 Third Quarter Results

Blackbaud launches new AI innovation at annual bbcon conference

CHARLESTON, S.C., Oct. 29, 2025 /PRNewswire/ -- Blackbaud (NASDAQ: BLKB), the leading provider of software for powering social impact, today announced financial results for its third quarter ended September 30, 2025.

"Innovation continues to drive our clear market leadership and a widening competitive moat," said Mike Gianoni, president, CEO and vice chairman of the board of directors, Blackbaud. "As demonstrated at our recent bbcon conference in October, we continue to make significant investments in AI, empowering our customers to deepen constituent relationships, raise more money and operate more efficiently. For investors, we believe Blackbaud is a sound investment choice that has the potential to create substantial shareholder value – a belief that is supported by our strong 2025 year to date financial results. I continue to be excited about the company's momentum in the near, mid- and long-term."

Third Quarter 2025 Results Compared to Third Quarter 2024 Results:

"Blackbaud continues to be well-positioned for long-term success," said Chad Anderson, executive vice president and CFO, Blackbaud. "These strong results reflect our execution discipline and ongoing productivity improvements. We remain committed to providing investors an attractive financial model balanced across growth in revenues, earnings, and cash flows along with a prudent and purposeful capital allocation strategy. Year to date we have repurchased more than 5% of our common stock outstanding while also reducing our leverage ratio from 2.9x in Q1 to 2.4x in Q3. We have a lot to be proud of and a lot more to look forward to in Q4 2025 and beyond."

An explanation of all non-GAAP financial measures referenced in this press release, including the Rule of 40, is included below under the heading "Non-GAAP Financial Measures." A reconciliation of the company's non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release.

Recent Company Highlights

Visit www.blackbaud.com/newsroom for more information about Blackbaud's recent highlights.

Financial Outlook

Blackbaud today reiterated its 2025 full year financial guidance for revenue, adjusted EBITDA margin and earnings per share and raised guidance for adjusted free cash flow:

Included in its 2025 full year financial guidance are the following updated assumptions:

Blackbaud has not reconciled forward-looking full-year non-GAAP financial measures contained in this news release to their most directly comparable GAAP measures, as permitted by Item 10(e)(1)(i)(B) of Regulation S-K. Such reconciliations would require unreasonable efforts at this time to estimate and quantify with a reasonable degree of certainty various necessary GAAP components, including for example those related to compensation, acquisition transactions and integration, tax items or others that may arise during the year. These components and other factors could materially impact the amount of the future directly comparable GAAP measures, which may differ significantly from their non-GAAP counterparts.

In order to provide a meaningful basis for comparison, Blackbaud uses non-GAAP adjusted free cash flow in analyzing its operating performance. Non-GAAP adjusted free cash flow is defined as operating cash flow less capital expenditures, including costs required to be capitalized for software development, capital expenditures for property and equipment, plus cash outflows related to the previously disclosed Security Incident discovered in May 2020 (the "Security Incident"). Please refer to the section below titled "Non-GAAP Financial Measures" for more information on Blackbaud's use of non-GAAP financial measures.

Stock Repurchase Program

As of September 30, 2025, Blackbaud had approximately $514 million remaining under its common stock repurchase program that was expanded, replenished and reauthorized in July 2024. Based on our current plans, we expect total repurchases during 2025 to represent between 5.2% and 7.0% of our outstanding common stock as of December 31, 2024.

Financial Statement Presentation

Reclassifications

Our revenue from "recurring" and "one-time services and other" have been combined within "revenue" beginning in 2025 due to the immateriality of our one-time services and other revenue. In order to provide comparability between periods presented, our "recurring" and "one-time services and other" revenue lines have been combined within "revenue" in the previously reported consolidated statements of comprehensive income to conform to the presentation of the current period. Similarly, "cost of recurring" and "cost of one-time services and other" have been combined within "cost of revenue" in the previously reported consolidated statements of comprehensive income to conform to the presentation of the current period.

Revision of Prior Period Financial Statements

The Company identified a prior period noncash error related to the previously recorded valuation allowance in accounting for income taxes. The correction of this error decreased our income tax benefit by $15.5 million with a corresponding increase to GAAP net loss for the year ended December 31, 2024, and increased the deferred tax liability by $15.5 million in our consolidated balance sheets as of December 31, 2024, March 31, 2025, and June 30, 2025. We concluded that the error was not material to any of the prior reporting periods and, therefore, amendments of previously filed reports were not required. However, the effect of correcting the error in the current period would have been material to the consolidated financial statements for the three and nine months ended September 30, 2025, and the year ending December 31, 2025. Accordingly, the correction of this error, along with other immaterial prior period errors, has been reflected as a revision to the applicable prior periods in the financial information presented herein and will be reflected in future filings that include such periods. As part of this press release, the Company has included comparative financial statement tables showing "as reported" versus "as revised" amounts. The revisions for these corrections to the applicable prior periods will be reflected in the Company's Quarterly Report on Form 10-Q for the third quarter of 2025.

Conference Call Details

What: Blackbaud's 2025 Third Quarter Conference Call

When: October 29, 2025

Time: 8:00 a.m. (Eastern Time)

Live Call: 1-877-407-3088 (US/Canada)

Webcast: Blackbaud's Investor Relations Webpage

About Blackbaud

Blackbaud (NASDAQ: BLKB) is the leading software provider exclusively dedicated to powering social impact. Serving the nonprofit and education sectors, companies committed to social responsibility and individual change makers, Blackbaud's essential software is built to accelerate impact in fundraising, nonprofit financial management, digital giving, grantmaking, corporate social responsibility and education management. With millions of users and over $100 billion raised, granted or managed through Blackbaud platforms every year, Blackbaud's solutions are unleashing the potential of the people and organizations who change the world. Blackbaud has been named to Newsweek's list of America's Most Responsible Companies, Quartz's list of Best Companies for Remote Workers and Forbes' list of America's Best Employers. A remote-first company, Blackbaud has operations in the United States, Australia, Canada, Costa Rica, India and the United Kingdom, supporting users in 100+ countries. Learn more at www.blackbaud.com, or follow us on X/Twitter, LinkedIn, Instagram, and Facebook.

Investor Contact

IR@blackbaud.com

Media Contact

media@blackbaud.com

Forward-Looking Statements

Except for historical information, all of the statements, expectations, and assumptions contained in this news release are forward-looking statements which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding the predictability of our financial condition and results of operations. These statements involve a number of risks and uncertainties. Although Blackbaud attempts to be accurate in making these forward-looking statements, it is possible that future circumstances might differ from the assumptions on which such statements are based. In addition, other important factors that could cause results to differ materially include the following: management of integration of acquired companies; uncertainty regarding increased business and renewals from existing customers; a shifting revenue mix that may impact gross margin; continued success in sales growth; cybersecurity and data protection risks and related liabilities; potential litigation involving us; and the other risk factors set forth from time to time in the SEC filings for Blackbaud, copies of which are available free of charge at the SEC's website at www.sec.gov or upon request from Blackbaud's investor relations department. Blackbaud assumes no obligation and does not intend to update these forward-looking statements, except as required by law.

Trademarks

All Blackbaud product names appearing herein are trademarks or registered trademarks of Blackbaud, Inc.

Non-GAAP Financial Measures

Blackbaud has provided in this release financial information that has not been prepared in accordance with GAAP. Blackbaud uses non-GAAP financial measures internally in analyzing its operational performance. Accordingly, Blackbaud believes these non-GAAP measures are useful to investors, as a supplement to GAAP measures, in evaluating its ongoing operational performance and trends and in comparing its financial results from period-to-period with other companies in Blackbaud's industry, many of which present similar non-GAAP financial measures to investors. However, these non-GAAP financial measures may not be completely comparable to similarly titled measures of other companies due to potential differences in the exact method of calculation between companies.

The non-GAAP financial measures discussed above exclude the impact of certain transactions that Blackbaud believes are not directly related to its operating performance in any particular period, but are for its long-term benefit over multiple periods. Blackbaud believes these non-GAAP financial measures reflect its ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of trends in its business.

While Blackbaud believes these non-GAAP measures provide useful supplemental information, non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliations of these non-GAAP measures to their most directly comparable GAAP financial measures.

Non-GAAP free cash flow is defined as operating cash flow less capital expenditures, including costs required to be capitalized for software development, and capital expenditures for property and equipment. In addition, and in order to provide a meaningful basis for comparison, Blackbaud also uses non-GAAP adjusted free cash flow in analyzing its operating performance. Non-GAAP adjusted free cash flow is defined as operating cash flow less capital expenditures, including costs required to be capitalized for software development, and capital expenditures for property and equipment, plus cash outflows related to the Security Incident. Blackbaud believes non-GAAP free cash flow and non-GAAP adjusted free cash flow provide useful measures of the company's operating performance. Non-GAAP free cash flow and non-GAAP adjusted free cash flow are not intended to represent and should not be viewed as the amount of residual cash flow available for discretionary expenditures.

In addition, Blackbaud uses non-GAAP organic revenue growth, non-GAAP organic revenue growth on a constant currency basis, non-GAAP organic recurring revenue growth and non-GAAP organic recurring revenue growth on a constant currency basis, in analyzing its operating performance. Blackbaud believes that these non-GAAP measures are useful to investors, as a supplement to GAAP measures, for evaluating the periodic growth of its business on a consistent basis. Each of these measures excludes incremental acquisition-related revenue attributable to companies, if any, acquired in the current fiscal year. For companies acquired in the immediately preceding fiscal year, each of these measures reflects presentation of full-year incremental non-GAAP revenue derived from such companies as if they were combined throughout the prior period. In addition, each of these measures excludes prior period revenue associated with divested businesses. The exclusion of the prior period revenue is to present the results of the divested businesses within the results of the combined company for the same period of time in both the prior and current periods. Blackbaud believes this presentation provides a more comparable representation of its current business' organic revenue growth and revenue run-rate.

Rule of 40 is defined as non-GAAP organic revenue growth plus non-GAAP adjusted EBITDA margin. Non-GAAP adjusted EBITDA is defined as GAAP net income plus interest, net; income tax provision (benefit); depreciation; amortization of intangible assets from business combinations; amortization of software development costs; stock-based compensation; employee severance; acquisition and disposition-related costs; Security Incident-related costs; and impairment and disposition charges.

Blackbaud, Inc.

Consolidated Balance Sheets

(Unaudited)

(dollars in thousands, except per share amounts)

September 30,

2025

December 31,

2024 (1)

Assets

Current assets:

Cash and cash equivalents

$ 38,255

$ 67,628

Restricted cash

419,185

741,884

Accounts receivable, net of allowance of $6,196 and $5,228 at September 30, 2025 and December 31, 2024, respectively

82,561

83,539

Customer funds receivable

3,996

1,970

Prepaid expenses and other current assets

94,838

81,572

Total current assets

638,835

976,593

Property and equipment, net

85,332

91,926

Operating lease right-of-use assets

4,931

26,554

Software development costs, net

154,074

148,319

Goodwill

1,056,656

1,052,506

Intangible assets, net

112,697

132,881

Other assets

51,916

67,221

Total assets

$ 2,104,441

$ 2,496,000

Liabilities and stockholders' equity

Current liabilities:

Trade accounts payable

$ 48,761

$ 50,810

Accrued expenses and other current liabilities

53,049

76,484

Due to customers

421,820

742,340

Debt, current portion

22,613

23,875

Deferred revenue, current portion

383,138

358,546

Total current liabilities

929,381

1,252,055

Debt, net of current portion

1,042,005

1,051,110

Deferred tax liability

9,246

24,999

Deferred revenue, net of current portion

1,773

2,015

Operating lease liabilities, net of current portion

5,030

34,186

Other liabilities

8,816

4,796

Total liabilities

1,996,251

2,369,161

Commitments and contingencies

Stockholders' equity:

Preferred stock; 20,000,000 shares authorized, none outstanding

—

Common stock, $0.001 par value; 180,000,000 shares authorized, 72,295,494 and 70,943,373 shares issued at September 30, 2025 and December 31, 2024, respectively; 48,057,972 and 49,245,588 shares outstanding at September 30, 2025 and December 31, 2024, respectively

Additional paid-in capital

1,369,807

1,291,442

Treasury stock, at cost; 24,237,522 and 21,697,785 shares at September 30, 2025 and December 31, 2024, respectively

(1,231,316)

(1,060,348)

Accumulated other comprehensive loss

(9,198)

(4,869)

Accumulated deficit

(21,175)

(99,457)

Total stockholders' equity

108,190

126,839

Total liabilities and stockholders' equity

$ 2,104,441

$ 2,496,000

(1)

We have revised certain amounts in the December 31, 2024 unaudited condensed consolidated balance sheet. See Revision of Prior Period Financial Statements in this press release.

Blackbaud, Inc.

Consolidated Statements of Comprehensive Income

(Unaudited)

(dollars in thousands, except per share amounts)

Three months ended

September 30,

Nine months ended

September 30,

2025

2024 (1)

2025 (1)

2024 (1)

Revenue

$ 281,143

$ 286,598

$ 833,109

$ 852,511

Cost of revenue

113,653

129,290

342,101

383,615

Gross profit

167,490

157,308

491,008

468,896

Operating expenses

Sales, marketing and customer success

44,105

49,808

132,795

147,400

Research and development

37,198

37,916

104,352

116,045

General and administrative

31,044

27,519

120,579

106,842

Amortization of intangible assets

570

918

1,670

2,724

Total operating expenses

112,917

116,161

359,396

373,011

Income from operations

54,573

41,147

131,612

95,885

Interest expense

(16,774)

(14,140)

(52,130)

(40,131)

Other income, net

3,245

2,997

6,468

9,654

Income before (benefit) provision for income taxes

41,044

30,004

85,950

65,408

Income tax (benefit) provision

(6,448)

11,714

7,668

18,568

Net income

$ 47,492

$ 18,290

$ 78,282

$ 46,840

Earnings per share

Basic

$ 1.00

$ 0.36

$ 1.63

$ 0.92

Diluted

$ 0.98

$ 0.35

$ 1.61

$ 0.90

Common shares and equivalents outstanding

Basic weighted average shares

47,680,002

50,409,292

47,961,631

51,067,255

Diluted weighted average shares

48,498,285

51,632,569

48,634,027

52,107,147

Other comprehensive loss

Foreign currency translation adjustment

$ (2,285)

$ 6,463

$ 8,298

$ 5,617

Unrealized loss on derivative instruments, net of tax

(622)

(13,525)

(12,628)

(10,816)

Total other comprehensive loss

(2,907)

(7,062)

(4,330)

(5,199)

Comprehensive income

$ 44,585

$ 11,228

$ 73,952

$ 41,641

(1)

We have revised certain amounts in the unaudited condensed consolidated statements of comprehensive income for the nine months ended September 30, 2025, and the three and nine months ended September 30, 2024. See Revision of Prior Period Financial Statements in this press release.

Blackbaud, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

Nine months ended

September 30,

(dollars in thousands)

2025 (1)

2024 (1)

Cash flows from operating activities

Net income

$ 78,282

$ 46,840

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

64,652

91,618

Provision for credit losses and sales returns

3,788

1,721

Stock-based compensation expense

71,079

76,430

Deferred taxes

(16,682)

(21,776)

Amortization of deferred financing costs and discount

1,940

1,786

Loss on disposition of businesses

—

1,561

Other non-cash adjustments

(5,180)

2,462

Changes in operating assets and liabilities, net of acquisition and disposal of businesses:

Accounts receivable

(2,422)

918

Prepaid expenses and other assets

(9,708)

(934)

Trade accounts payable

(3,233)

18,322

Accrued expenses and other liabilities

2,033

(16,089)

Deferred revenue

22,991

19,527

Net cash provided by operating activities

207,540

222,386

Cash flows from investing activities

Purchase of property and equipment

(4,805)

(7,235)

Capitalized software development costs

(40,268)

(42,882)

Cash used in disposition of business

(12,235)

(1,179)

Other investing activities

—

(5,029)

Net cash used in investing activities

(57,308)

(56,325)

Cash flows from financing activities

Proceeds from issuance of debt

307,000

1,303,400

Payments on debt

(316,922)

(1,080,192)

Debt issuance costs

—

(6,458)

Employee taxes paid for withheld shares upon equity award settlement

(39,669)

(55,950)

Change in due to customers

(323,467)

(263,732)

Change in customer funds receivable

(1,676)

(6,777)

Purchase of treasury stock, including excise tax payments

(133,338)

(325,408)

Net cash used in financing activities

(508,072)

(435,117)

Effect of exchange rate on cash, cash equivalents and restricted cash

5,768

3,527

Net decrease in cash, cash equivalents and restricted cash

(352,072)

(265,529)

Cash, cash equivalents and restricted cash, beginning of period

809,512

728,257

Cash, cash equivalents and restricted cash, end of period

$ 457,440

$ 462,728

(1)

We have revised certain amounts in the unaudited condensed consolidated statements of cash flows for the nine months ended September 30, 2025 and 2024. See Revision of Prior Period Financial Statements in this press release.

The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown above in the consolidated statements of cash flows:

(dollars in thousands)

September 30,

2025

December 31,

2024

Cash and cash equivalents

$ 38,255

$ 67,628

Restricted cash

419,185

741,884

Total cash, cash equivalents and restricted cash in the statement of cash flows

$ 457,440

$ 809,512

Blackbaud, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

(dollars in thousands, except per share amounts)

Three months ended

September 30,

Nine months ended

September 30,

2025

2024 (1)

2025 (1)

2024 (1)

GAAP Revenue

$ 281,143

$ 286,598

$ 833,109

$ 852,511

GAAP gross profit

$ 167,490

$ 157,308

$ 491,008

$ 468,896

GAAP gross margin

59.6 %

54.9 %

58.9 %

55.0 %

Non-GAAP adjustments:

Add: Stock-based compensation expense

2,850

2,948

8,798

10,066

Add: Amortization of intangibles from business combinations

6,811

14,667

20,883

43,969

Add: Employee severance

(18)

—

284

—

Subtotal

9,643

17,615

29,965

54,035

Non-GAAP gross profit

$ 177,133

$ 174,923

$ 520,973

$ 522,931

Non-GAAP gross margin

63.0 %

61.0 %

62.5 %

61.3 %

GAAP income from operations

$ 54,573

$ 41,147

$ 131,612

$ 95,885

GAAP operating margin

19.4 %

14.4 %

15.8 %

11.2 %

Non-GAAP adjustments:

Add: Stock-based compensation expense

21,657

21,125

71,079

76,430

Add: Amortization of intangibles from business combinations

7,381

15,585

22,553

46,693

Add: Employee severance

(242)

—

1,905

—

Add: Acquisition and disposition-related costs (2)

383

246

25,779

4,899

Add: Security Incident-related costs (3)

247

637

2,822

12,782

Subtotal

29,426

37,593

124,138

140,804

Non-GAAP income from operations

$ 83,999

$ 78,740

$ 255,750

$ 236,689

Non-GAAP operating margin

29.9 %

27.5 %

30.7 %

27.8 %

GAAP income before (benefit) provision for income taxes

$ 41,044

$ 30,004

$ 85,950

$ 65,408

GAAP net income

$ 47,492

$ 18,290

$ 78,282

$ 46,840

Shares used in computing GAAP diluted earnings per share

48,498,285

51,632,569

48,634,027

52,107,147

GAAP diluted earnings per share

$ 0.98

$ 0.35

$ 1.61

$ 0.90

Non-GAAP adjustments:

Add: GAAP income tax (benefit) provision

(6,448)

11,714

7,668

18,568

Add: Total non-GAAP adjustments affecting income from operations

29,426

37,593

124,138

140,804

Non-GAAP income before provision for income taxes

70,470

67,597

210,088

206,212

Assumed non-GAAP income tax provision (4)

17,265

16,561

51,472

50,522

Non-GAAP net income

$ 53,205

$ 51,036

$ 158,616

$ 155,690

Shares used in computing non-GAAP diluted earnings per share

48,498,285

51,632,569

48,634,027

52,107,147

Non-GAAP diluted earnings per share

$ 1.10

$ 0.99

$ 3.26

$ 2.99

(1)

We have revised certain amounts in the unaudited reconciliation of GAAP to non-GAAP financial measures for the nine months ended September 30, 2025, and the three and nine months ended September 30, 2024. See Revision of Prior Period Financial Statements in this press release.

(2)

Includes charges of $24.3 million incurred during the nine months ended September 30, 2025 related to the release from our lease for office space in Washington, DC (which was acquired as part of our acquisition of EVERFI in December 2021).

(3)

Includes Security Incident-related costs incurred during the three months ended September 30, 2025 and 2024 which were insignificant for on-going legal fees, during the nine months ended September 30, 2025 of $2.8 million, which included approximately $1.1 million in recorded accruals for loss contingencies and during the nine months ended September 30, 2024 of $12.8 million, which included approximately $6.8 million in recorded accruals for loss contingencies. Recorded expenses consisted primarily of payments to third-party service providers and consultants, including legal fees, as well as settlements of customer claims, negotiated settlements and accruals for certain loss contingencies. Not included in this adjustment were costs associated with enhancements to our cybersecurity program. As of September 30, 2025, we do not have any recorded liabilities for loss contingencies related to the Security Incident.

(4)

We apply a non-GAAP effective tax rate of 24.5% when calculating non-GAAP net income and non-GAAP diluted earnings per share.

Blackbaud, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

(dollars in thousands)

Three months ended

September 30,

Nine months ended

September 30,

2025

2024 (1)

2025

2024 (1)

GAAP revenue

$ 281,143

$ 286,598

$ 833,109

$ 852,511

GAAP revenue growth

(1.9) %

(2.3) %

Less: Non-GAAP revenue from divested businesses (2)

—

(19,304)

—

(66,469)

Non-GAAP organic revenue (3)

$ 281,143

$ 267,294

$ 833,109

$ 786,042

Non-GAAP organic revenue growth

5.2 %

6.0 %

Non-GAAP organic revenue (3)

$ 281,143

$ 267,294

$ 833,109

$ 786,042

Foreign currency impact on non-GAAP organic revenue (4)

(964)

—

(2,576)

—

Non-GAAP organic revenue on constant currency basis (4)

$ 280,179

$ 267,294

$ 830,533

$ 786,042

Non-GAAP organic revenue growth on constant currency basis

4.8 %

5.7 %

GAAP recurring revenue

$ 275,802

$ 279,889

$ 815,406

$ 832,160

GAAP recurring revenue growth

(1.5) %

(2.0) %

Less: Non-GAAP recurring revenue from divested businesses (2)

—

(18,435)

—

(63,907)

Non-GAAP organic recurring revenue (3)

$ 275,802

$ 261,454

$ 815,406

$ 768,253

Non-GAAP organic recurring revenue growth

5.5 %

6.1 %

Non-GAAP organic recurring revenue (2)

$ 275,802

$ 261,454

$ 815,406

$ 768,253

Foreign currency impact on non-GAAP organic recurring revenue (4)

(955)

—

(2,572)

—

Non-GAAP organic recurring revenue on constant currency basis (4)

$ 274,847

$ 261,454

$ 812,834

$ 768,253

Non-GAAP organic recurring revenue growth on constant currency basis

5.1 %

5.8 %

(1)

(2)

Non-GAAP revenue from divested businesses excludes revenue associated with divested businesses in the prior period. The exclusion of the prior period revenue is to present the results of the divested business with the results of the combined company for the same period of time in both the prior and current periods.

(3)

Non-GAAP organic revenue and non-GAAP organic recurring revenue for the prior year periods presented herein may not agree to non-GAAP organic revenue and non-GAAP organic recurring revenue presented in the respective prior period quarterly financial information solely due to the manner in which non-GAAP organic revenue growth and non-GAAP organic recurring revenue growth are calculated.

(4)

To determine non-GAAP organic revenue growth and non-GAAP organic recurring revenue growth on a constant currency basis, revenues from entities reporting in foreign currencies were translated to U.S. Dollars using the comparable prior period's quarterly weighted average foreign currency exchange rates. The primary foreign currencies creating the impact are the Australian Dollar, British Pound, Canadian Dollar and Euro.

(dollars in thousands)

Nine months ended

September 30,

2025

2024

GAAP net cash provided by operating activities

$ 207,540

$ 222,386

GAAP operating cash flow margin

24.9 %

26.1 %

Non-GAAP adjustments:

Less: purchase of property and equipment

(4,805)

(7,235)

Less: capitalized software development costs

(40,268)

(42,882)

Non-GAAP free cash flow

$ 162,467

$ 172,269

Non-GAAP free cash flow margin

19.5 %

20.2 %

Non-GAAP adjustments:

Add: Security Incident-related cash flows

4,300

15,081

Non-GAAP adjusted free cash flow

$ 166,767

$ 187,350

Non-GAAP adjusted free cash flow margin

20.0 %

22.0 %

Blackbaud, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

(dollars in thousands)

Three months ended

September 30,

Nine months ended

September 30,

2025

2024 (1)

2025 (1)

2024 (1)

GAAP net income

$ 47,492

$ 18,290

$ 78,282

$ 46,840

Non-GAAP adjustments:

Add: Interest, net

14,403

11,022

46,136

32,150

Add: GAAP income tax (benefit) provision

(6,448)

11,714

7,668

18,568

Add: Depreciation

2,181

3,293

7,823

9,621

Add: Amortization of intangibles from business combinations

7,381

15,585

22,553

46,693

Add: Amortization of software development costs (2)

12,605

13,186

36,781

37,915

Subtotal

30,122

54,800

120,961

144,947

Non-GAAP EBITDA

$ 77,614

$ 73,090

$ 199,243

$ 191,787

Non-GAAP EBITDA margin (3)

27.6 %

23.9 %

Non-GAAP adjustments:

Add: Stock-based compensation expense

$ 21,657

$ 21,125

$ 71,079

$ 76,430

Add: Employee severance

(242)

—

1,905

—

Add: Acquisition and disposition-related costs (4)

383

246

25,779

4,899

Add: Security Incident-related costs (4)

247

637

2,822

12,782

Subtotal

22,045

22,008

101,585

94,111

Non-GAAP adjusted EBITDA

$ 99,659

$ 95,098

$ 300,828

$ 285,898

Non-GAAP adjusted EBITDA margin (5)

35.4 %

36.1 %

Rule of 40 (6)

40.6 %

42.1 %

Non-GAAP adjusted EBITDA

$ 99,659

$ 95,098

$ 300,828

$ 285,898

Foreign currency impact on Non-GAAP adjusted EBITDA (7)

(512)

(556)

(1,403)

(1,059)

Non-GAAP adjusted EBITDA on constant currency basis (7)

$ 99,147

$ 94,542

$ 299,425

$ 284,839

Non-GAAP adjusted EBITDA margin on constant currency basis

35.4 %

36.1 %

Rule of 40 on constant currency basis (8)

40.2 %

41.8 %

(1)

(2)

Includes amortization expense related to software development costs, and amortization expense from capitalized cloud computing implementation costs.

(3)

Measured by GAAP revenue divided by non-GAAP EBITDA.

(4)

See additional details in the reconciliation of GAAP to Non-GAAP operating income above.

(5)

Measured by non-GAAP organic revenue divided by non-GAAP adjusted EBITDA.

(6)

Measured by non-GAAP organic revenue growth plus non-GAAP adjusted EBITDA margin. See Non-GAAP organic revenue growth table above.

(7)

To determine non-GAAP adjusted EBITDA on a constant currency basis, non-GAAP adjusted EBITDA from entities reporting in foreign currencies were translated to U.S. Dollars using the comparable prior period's quarterly weighted average foreign currency exchange rates. The primary foreign currencies creating the impact are the Australian Dollar, British Pound, Canadian Dollar and Euro.

(8)

Measured by non-GAAP organic revenue growth on constant currency basis plus non-GAAP adjusted EBITDA margin on constant currency basis.

Blackbaud, Inc.

Revised Historical Financial Information

(Unaudited)

Revised consolidated balance sheet

(dollars in millions)

As of December 31, 2024

reported

Adjustment

revised

Prepaid expenses and other current assets

$ 81.3

$ 0.3

$ 81.6

Total current assets

976.3

0.3

976.6

Total assets

2,495.7

0.3

2,496.0

Accrued expenses and other current liabilities

75.5

0.9

76.5

Deferred revenue, current portion

359.5

(1.0)

358.5

Total current liabilities

1,252.1

—

1,252.1

Deferred tax liability

9.5

15.5

25.0

Total noncurrent liabilities

1,101.6

15.5

1,117.1

Total liabilities

2,353.7

15.4

2,369.2

Accumulated deficit

(84.3)

(15.2)

(99.5)

Total stockholders' equity

142.0

(15.2)

126.8

Total liabilities and stockholders' equity

2,495.7

0.3

2,496.0

Revised consolidated statements of comprehensive (loss) income

(dollars in millions, except per share

amounts)

Three months ended March 31, 2024

Three months ended June 30, 2024

Three months ended September 30, 2024

reported

Adjustment

revised

reported

Adjustment

revised

reported

Adjustment

revised

Revenue

$ 279.3

$ (0.7)

$ 278.6

$ 287.3

$ 0.1

$ 287.3

$ 286.7

$ (0.1)

$ 286.6

Cost of revenue

126.2

1.7

127.9

124.7

1.7

126.4

127.5

1.8

129.3

Gross profit

153.0

(2.3)

150.7

162.6

(1.7)

160.9

159.2

(1.9)

157.3

Sales, marketing and customer success

50.9

(0.5)

50.4

47.1

0.1

47.2

49.5

0.4

49.8

Research and development

42.8

(2.1)

40.7

39.1

(1.7)

37.4

39.4

(1.5)

37.9

General and administrative

47.8

(2.4)

45.4

33.4

0.5

34.0

25.6

1.9

27.5

Total operating expenses

142.3

(5.0)

137.4

120.5

(1.0)

119.5

115.4

0.8

116.2

Income from operations

10.7

2.6

13.3

42.1

(0.7)

41.4

43.8

(2.7)

41.1

Income before provision (benefit) for income taxes

3.8

2.6

6.4

29.7

(0.7)

29.0

32.7

(2.7)

30.0

Income tax (benefit) provision

(1.5)

0.6

(0.9)

7.9

(0.1)

7.8

12.1

(0.4)

11.7

Net income

5.2

2.1

7.3

21.8

(0.6)

21.2

20.5

(2.3)

18.3

Earnings per share

Basic

0.10

0.04

0.14

0.43

(0.01)

0.42

0.41

(0.05)

0.36

Diluted

0.10

0.04

0.14

0.42

(0.01)

0.41

0.40

(0.05)

0.35

Comprehensive (loss) income

8.2

2.1

10.2

20.8

(0.6)

20.2

13.5

(2.3)

11.2

(dollars in millions, except per share amounts)

Three months ended March 31, 2025

Three months ended June 30, 2025

reported

Adjustment

revised

reported

Adjustment

revised

Revenue

$ 270.7

$ (0.7)

$ 269.9

$ 281.4

$ 0.6

$ 282.0

Gross profit

155.8

(0.7)

155.1

167.7

0.6

168.4

Income from operations

20.4

(0.7)

19.7

56.7

0.6

57.3

Income before provision for income taxes

5.6

(0.7)

4.9

39.4

0.6

40.0

Income tax provision

0.7

(0.2)

0.5

13.4

0.2

13.6

Net income

4.9

(0.5)

4.3

26.0

0.5

26.5

Earnings per share

Basic

0.10

(0.01)

0.09

0.54

0.01

0.55

Diluted

0.10

(0.01)

0.09

0.54

0.01

0.55

Comprehensive income

1.4

(0.5)

0.9

28.0

0.5

28.5

Blackbaud, Inc.

Revised Historical Financial Information

(Unaudited)

Revised consolidated statements of cash flows

(dollars in millions)

Three months ended March 31, 2024

Six months ended June 30, 2024

Nine months ended September 30, 2024

reported

Adjustment

revised

reported

Adjustment

revised

reported

Adjustment

revised

Cash flows from operating activities

Net income

$ 5.2

$ 2.1

$ 7.3

$ 27.1

$ 1.5

$ 28.6

$ 47.6

$ (0.8)

$ 46.8

Adjustments to reconcile net income to net cash provided by operating activities:

Stock-based compensation expense

33.6

(3.3)

30.3

57.9

(2.6)

55.3

76.4

—

76.4

Deferred taxes

(12.2)

0.6

(11.7)

(18.8)

0.4

(18.4)

(21.8)

—

(21.8)

Changes in operating assets and liabilities, net of acquisition and disposal of businesses:

Prepaid expenses and other assets

(3.3)

—

(3.2)

(2.5)

—

(2.5)

(0.9)

(0.1)

(0.9)

Trade accounts payable

23.1

0.7

23.8

19.1

—

19.1

18.3

—

18.3

Accrued expenses and other liabilities

7.9

0.2

8.1

(13.6)

0.2

(13.4)

(16.4)

0.3

(16.1)

Deferred revenue

(25.8)

0.5

(25.4)

36.2

0.4

36.6

19.0

0.5

19.5

Net cash provided by operating activities

64.6

0.7

65.3

118.4

—

118.4

222.4

—

222.4

Cash flows from investing activities

Purchase of property and equipment

(0.3)

(0.7)

(1.0)

(6.1)

—

(6.1)

(7.2)

—

(7.2)

Net cash used in investing activities

(14.5)

(0.7)

(15.2)

(40.7)

—

(40.7)

(56.3)

—

(56.3

(dollars in millions)

Three months ended March 31, 2025

Six months ended June 30, 2025

reported

Adjustment

revised

reported

Adjustment

revised

Cash flows from operating activities

Net income

$ 4.9

$ (0.5)

$ 4.3

$ 30.8

$ (0.1)

$ 30.8

Adjustments to reconcile net income to net cash provided by operating activities:

Provision for credit losses and sales returns

0.8

—

0.8

3.8

(0.8)

3.0

Changes in operating assets and liabilities, net of acquisition and disposal of businesses:

Prepaid expenses and other assets

(5.3)

0.1

(5.2)

(8.9)

—

(9.0)

Accrued expenses and other liabilities

(8.2)

0.1

(8.1)

(10.2)

0.3

(9.9)

Deferred revenue

(29.8)

0.3

(29.4)

38.2

0.6

38.8

Net cash provided by operating activities

1.4

—

1.4

68.3

—

68.3

SOURCE Blackbaud