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Blackbaud Announces 2025 Third Quarter Results

  • Blackbaud
  • Oct 29, 2025

Blackbaud launches new AI innovation at annual bbcon conference

Charleston, S.C. (October 29, 2025) — 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:

  • GAAP total revenue was $281.1 million, down 1.9% (driven by divestiture of EVERFI) and non-GAAP organic revenue increased 5.2%.
  • GAAP recurring revenue was $275.8 million, down 1.5% (driven by divestiture of EVERFI) and represented 98.1% of total revenue. Non-GAAP organic recurring revenue increased 5.5%.
  • GAAP income from operations was $54.6 million, with GAAP operating margin of 19.4%, an increase of 500 basis points.
  • Non-GAAP income from operations was $84.0 million, with non-GAAP operating margin of 29.9%, an increase of 240 basis points.
  • GAAP net income was $47.5 million, with GAAP diluted earnings per share of $0.98, up $0.63 per share.
  • Non-GAAP net income was $53.2 million, with non-GAAP diluted earnings per share of $1.10, up $0.11 per share.
  • Non-GAAP adjusted EBITDA was $99.7 million, up $4.6 million, with non-GAAP adjusted EBITDA margin of 35.4%, an increase of 220 basis points.
  • Rule of 40 score of 40.6%.
  • GAAP net cash provided by operating activities was $139.2 million, an increase of $35.3 million, with GAAP operating cash flow margin of 49.5%, an increase of 1,320 basis points.
  • Non-GAAP free cash flow was $123.2 million, an increase of $34.9 million, with non-GAAP free cash flow margin of 43.8%, an increase of 1,300 basis points.
  • Non-GAAP adjusted free cash flow was $125.1 million, an increase of $27.5 million, with non-GAAP adjusted free cash flow margin of 44.5%, an increase of 1,040 basis points.

“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:

  • GAAP revenue of $1.120 billion to $1.130 billion
  • Non-GAAP adjusted EBITDA margin of 35.4% to 36.2%
  • Non-GAAP diluted earnings per share of $4.30 to $4.50
  • Non-GAAP adjusted free cash flow of $195 million to $205 million

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

  • Non-GAAP annualized effective tax rate is expected to be approximately 24.5%
  • Interest expense for the year is expected to be approximately $66 million to $70 million
  • Fully diluted shares for the year are expected to be approximately 48.5 million to 49.5 million
  • Capital expenditures for the year are expected to be approximately $55 million to $65 million, including approximately $50 million to $60 million of capitalized software development costs

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.