Blackbaud (BLKB) investor relations material

Executive summary

• Achieved record Rule of 40/45 performance in Q2 2025, with strong organic revenue growth, margin expansion, and profitability improvements, despite a GAAP revenue decline due to the EVERFI divestiture.

• Raised full-year 2025 guidance across all key metrics, reflecting robust business momentum and operational execution.

• Continued focus on innovation, especially AI, cloud migration, and digital integrations, with new product launches and strategic partnerships.

• Divested EVERFI business as of December 31, 2024, normalizing growth metrics and impacting year-over-year revenue comparisons.

• Executed disciplined capital allocation, including share repurchases, deleveraging, and targeted M&A.

Financial highlights

• Q2 2025 GAAP revenue: $281.4M (down 2.1% YoY); non-GAAP organic revenue: $281.4M (up 6.8% YoY, excluding EVERFI).

• Adjusted EBITDA margin was 38.5% (up nearly 300 bps YoY); non-GAAP adjusted EBITDA: $108.5M (up $5.9M YoY).

• Non-GAAP diluted EPS: $1.21 (up $0.13 YoY); GAAP diluted EPS: $0.54 (up $0.12 YoY).

• Adjusted free cash flow: $53M in Q2 (up from $36M YoY); non-GAAP adjusted free cash flow guidance midpoint for 2025: $195M.

• Gross margin improved to 63.4% non-GAAP (up from 62.9% YoY); GAAP gross margin: 59.6% (up 300 bps YoY).

Outlook and guidance

• 2025 revenue guidance: $1.12B–$1.13B, with ~5% organic growth at midpoint.

• Adjusted EBITDA margin guidance: 35.4%–36.2%; non-GAAP EPS: $4.30–$4.50 (up ~11% YoY at midpoint).

• Adjusted free cash flow guidance: $190M–$200M, with $60M in one-time working capital items not expected to repeat in 2026.

• Assumptions: 24.5% non-GAAP effective tax rate, $65M–$69M interest expense, $55M–$65M capex.

• Guidance assumes stable macroeconomic conditions; viral giving events and tax law changes could provide upside.