Blackbaud(US:BLKB)2025-10-29 11:21Financial Performance - GAAP total revenue for Q3 2025 was $281.1 million, down 1.9% year-over-year, while non-GAAP organic revenue increased by 5.2%[5] - GAAP recurring revenue was $275.8 million, down 1.5%, representing 98.1% of total revenue, with non-GAAP organic recurring revenue increasing by 5.5%[5] - GAAP net income was $47.5 million, with GAAP diluted earnings per share of $0.98, an increase of $0.63 per share year-over-year[5] - Non-GAAP adjusted EBITDA was $99.7 million, up $4.6 million, with a non-GAAP adjusted EBITDA margin of 35.4%, an increase of 220 basis points[5] - Non-GAAP free cash flow for Q3 2025 was $123.2 million, an increase of $34.9 million, with a margin of 43.8%, up 1,300 basis points[5] - The Rule of 40 score for Q3 2025 was 40.6%, indicating a balanced growth in revenue and profitability[5] - Non-GAAP income from operations for the nine months ended September 30, 2025, was $255,750, compared to $236,689 for the same period in 2024, representing a growth of 8.0%[42] - Non-GAAP adjusted EBITDA for the nine months ended September 30, 2025, was $300,828,000, up from $285,898,000 in 2024, reflecting a growth of 5.2%[48] - Non-GAAP adjusted free cash flow for the nine months ended September 30, 2025, was $166,767, compared to $187,350 in 2024[46] Revenue and Profitability Trends - Total revenue for the three months ended September 30, 2025, was $281,143, a decrease of 1.6% compared to $286,598 in the same period of 2024[31] - GAAP revenue for Q3 2025 was $281,143, a decrease of 1.9% compared to $286,598 in Q3 2024[42] - Non-GAAP organic revenue for Q3 2025 was $281,143, reflecting a growth of 5.2% from $267,294 in Q3 2024[42] - GAAP gross profit for Q3 2025 increased to $167,490, resulting in a gross margin of 59.6%, up from 54.9% in Q3 2024[42] - Basic earnings per share for the three months ended September 30, 2025, was $1.00, compared to $0.36 in 2024, reflecting a significant increase[31] - The company reported a net income of $78,282,000 for the nine months ended September 30, 2025, compared to $46,840,000 in 2024, marking a 67.2% increase[48] Cash Flow and Assets - Cash flows from operating activities for the nine months ended September 30, 2025, were $207,540, compared to $222,386 in 2024, indicating a decrease of 6.7%[34] - The company reported a decrease in cash and cash equivalents to $38,255 as of September 30, 2025, down 43.5% from $67,628 at December 31, 2024[35] - Total current assets decreased to $638,835 as of September 30, 2025, down 34.6% from $976,593 at December 31, 2024[29] - The company’s total assets decreased to $2,104,441 as of September 30, 2025, down 15.7% from $2,496,000 at December 31, 2024[29] - Total liabilities decreased to $1,996,251 as of September 30, 2025, down 15.7% from $2,369,161 at December 31, 2024[29] Stock and Capital Management - The company repurchased more than 5% of its common stock outstanding year-to-date and reduced its leverage ratio from 2.9x in Q1 to 2.4x in Q3[4] - Blackbaud's capital expenditures for 2025 are expected to be approximately $55 million to $65 million, including $50 million to $60 million for capitalized software development costs[11] - Stock-based compensation expense for the three months ended September 30, 2025, was $21,657,000, compared to $21,125,000 in 2024[48] Research and Development - Research and development expenses for the three months ended September 30, 2025, were $37,198, slightly down from $37,916 in 2024[31] - Blackbaud announced new AI capabilities at the bbcon 2025 conference, enhancing its product portfolio with smarter analytics and data insights[11] Other Financial Adjustments - The company incurred $24.3 million in charges related to the release from a lease for office space during the nine months ended September 30, 2025[38] - Security Incident-related costs for the nine months ended September 30, 2025, amounted to $2.8 million, down from $12.8 million in the same period of 2024[39] - The provision for credit losses and sales returns for Q1 2025 was $0.8 million, unchanged from the previous quarter[58] - Deferred revenue for Q1 2025 decreased by $29.4 million, reflecting a significant adjustment from $29.8 million[58]