Blackbaud Announces 2026 Third Quarter Financial Results

Blackbaud Expands AI Leadership Through Numerous Innovation Announcements at bbcon User Conference

CHARLESTON, S.C., Oct. 28, 2026 /PRNewswire/ -- Blackbaud (NASDAQ: BLKB), the world's leading provider of AI-powered solutions for social impact, today announced financial results for its third quarter ended September 30, 2026.

"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 September, 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 shareholder value—a belief that is supported by our strong 2026 year-to-date financial results and accelerating pace of innovation. I continue to be excited about the company's momentum in the near, mid and long term."

Third Quarter 2026 Results Compared to Third Quarter 2025 Results:

• GAAP total revenue was $292.6 million, up 4.1% and non-GAAP organic revenue increased 4.1%.
• GAAP recurring revenue was $287.0 million, up 4.1% and represented 98.1% of total revenue. Non-GAAP organic recurring revenue increased 4.1%.
• GAAP income from operations was $60.0 million, with GAAP operating margin of 20.5%, an increase of 110 basis points.
• Non-GAAP income from operations was $94.6 million, with non-GAAP operating margin of 32.3%, an increase of 240 basis points.
• GAAP net income was $46.1 million, with GAAP diluted earnings per share of $1.02, up $0.04 per share.
• Non-GAAP net income was $61.2 million, with non-GAAP diluted earnings per share of $1.36, up $0.26 per share.
• Non-GAAP adjusted EBITDA was $111.1 million, up $11.4 million, with non-GAAP adjusted EBITDA margin of 38.0%, an increase of 260 basis points.
• Rule of 40 score was 42.1%.
• GAAP net cash provided by operating activities was $141.7 million, an increase of $2.5 million, with GAAP operating cash flow margin of 48.4%, a decrease of 110 basis points.
• Non-GAAP free cash flow was $126.0 million, an increase of $2.8 million, with non-GAAP free cash flow margin of 43.1%, a decrease of 70 basis points.

"Blackbaud continues to be well-positioned for long-term success," said Chad Anderson, executive vice president and CFO, Blackbaud. "Our strong results reflect our execution discipline, ongoing productivity improvements, and balance sheet optimization. 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 7% of our common stock outstanding since the end of 2025 while also reducing our leverage ratio from 2.7x in Q1 to 2.3x in Q3. We have a lot to be proud of and a lot more to look forward to in Q4 2026 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

• At bbcon 2026:
  • Blackbaud introduced Platform for Good™, its unified operating system for social impact, bringing the company's products, data, AI, workflows and ecosystem together on a shared architecture to help organizations identify opportunities, expand capacity and move from information to action with greater confidence. Blackbaud also announced a broad portfolio of innovations across fundraising, marketing, financial management and education designed to strengthen the connected value of the platform.
  • Blackbaud also unveiled Lantern™, the first domain-specific language model purpose-built to optimize fundraising intelligence. Developed through a strategic collaboration with Databricks, Lantern is built on Blackbaud's four decades of experience in fundraising workflows, decisions, and results, so it understands the rhythms of fundraising and can illuminate opportunities that might otherwise go unseen. Starting in 2027, Lantern will be embedded within the Platform for Good and will begin powering select Blackbaud Raiser's Edge NXT® and Agents for Good™ capabilities.
  • In addition, Blackbaud shared updates on its expanding family of Agents for Good, including advancements to the Development Agent and the introduction of the Data Health Agent, a continuous data steward designed to detect and address data issues through review-and-approve workflows. Blackbaud also previewed agentic experiences for finance and education.
  • BILL and Blackbaud announced a strategic partnership to simplify the accounts payable process for nonprofit and education finance teams, embedding BILL's business payments network and payment-processing capabilities into Blackbaud Financial Edge NXT® Payment Assistant™. The connected experience is designed to support finance teams from invoice and approval through payment and reconciliation, reducing manual work within the financial management workflow.

• Blackbaud expanded the availability of Expedited Giving and Expedited Giving+ within its YourCause® from Blackbaud® solutions, accelerating how corporate and employee donations reach nonprofits. Expedited Giving delivers donations 90% faster than the industry average, while Expedited Giving+ is the industry's fastest option, enabling direct-to-nonprofit donations in near real time leveraging Blackbaud Integrated Payments.
• Blackbaud announced new integrations with Microsoft 365 Copilot and Intuit Mailchimp, connecting Raiser's Edge NXT to preferred technologies and giving users more ways to work, with best-in-class experiences.

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

Financial Outlook

Blackbaud today reaffirmed its 2026 full year financial guidance and expects to finish in the upper half of the range across all four key metrics:

• GAAP revenue of $1.173 billion to $1.179 billion
• Non-GAAP adjusted EBITDA of $430 million to $438 million
• Non-GAAP diluted earnings per share of $5.15 to $5.25
• Non-GAAP free cash flow of $280 million to $290 million

Included in its 2026 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 $62 million to $66 million
• Diluted weighted average shares outstanding for the year are expected to be approximately 45.0 million to 46.0 million
• Capital expenditures for the year are expected to be approximately $60 million to $70 million, including approximately $52 million to $62 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.

Stock Repurchase Program

As of September 30, 2026, Blackbaud had approximately $832 million remaining under its common stock repurchase program that was expanded, replenished and reauthorized in December 2025. Based on our current plans, and stock repurchases to date, we expect total repurchases during 2026 to represent between 7% and 10% of our outstanding common stock as of December 31, 2025.

Conference Call Details

About Blackbaud

Blackbaud (NASDAQ: BLKB) is the world's leading provider of AI-powered solutions for social impact. Serving nonprofits, educational institutions, companies committed to corporate social responsibility and individual change makers, Blackbaud propels impact at scale with the sector's most intelligent solutions for fundraising and engagement, education solutions, financial management and CSR and grantmaking. With the deepest expertise powered by the world's largest philanthropic data set, the most connected workflows, and the most powerful impact network, Blackbaud's solutions are building a future where resources are unleashed at the speed of need. Blackbaud has been recognized by Fast Company, Newsweek, Quartz, Forbes and more for AI innovation, responsible leadership and workplace excellence. 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; risks related to the development, deployment, regulation, security, market adoption and perception of artificial intelligence technologies; 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. Blackbaud believes non-GAAP free cash flow provides a useful measure of the company's operating performance. Non-GAAP free cash flow is 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, if any. 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 expense; global workforce transition costs; acquisition and disposition-related costs; and Security Incident-related costs.

Consolidated Balance Sheets

(Unaudited)

December 31, 2025, respectively

72,312,354 shares issued at September 30, 2026 and December 31, 2025, respectively;

45,102,406 and 46,705,325 shares outstanding at September 30, 2026 and December 31,

2025, respectively

December 31, 2025, respectively

Consolidated Statements of Comprehensive Income

(Unaudited)

Consolidated Statements of Cash Flows

(Unaudited)

balance sheets that sum to the total of the same such amounts shown above in the consolidated statements of cash flows:

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

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base this rate on our estimated annual GAAP income tax rate, adjusted for items excluded from GAAP income when calculating non-GAAP

income and for significant nonrecurring tax adjustments. We review this non-GAAP tax rate annually to determine whether it remains

appropriate for evaluating our financial performance. In conducting this review, we consider our GAAP annual effective tax rate, changes in

tax legislation, non-GAAP adjustments, and shifts in the geographic mix of revenues and expenses. We also evaluate other factors that we

deem significant. Because the tax treatment of non-GAAP adjustments differs from GAAP and because of our methodology for estimating

the annual tax rate, the non-GAAP tax rate may differ from the GAAP tax rate and from our actual tax liabilities.

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

currency basis

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.

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.

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.

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

implementation costs.

above.

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.

basis.

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SOURCE Blackbaud