Blackbaud's Q4 Earnings Surpass Estimates, Revenues Down Y/Y

Blackbaud, Inc. BLKB reported fourth-quarter 2025 non-GAAP earnings per share (EPS) of $1.19, which surpassed the Zacks Consensus Estimate by 3.5%. The bottom line increased around 11.2% year over year. For 2025, the company reported non-GAAP EPS of $4.45 compared to $4.06 in 2024.
Total revenues decreased 2.3% year over year to $295.3 million. This was due to the divestiture of EVERFI. The top line surpassed the Zacks Consensus Estimate by 0.5%.

For 2025, the company reported total revenues of $1.13 billion, down 2.3% year over year.

Blackbaud’s performance in 2025 underscored the strength of its multi-year strategy to expand market leadership while delivering solid financial results. The company achieved the Rule of 40 milestone two years ahead of schedule, reflecting disciplined execution of its strategic and operational priorities. The company maintained an active share repurchase program, buying back approximately 8% of its outstanding common stock in 2025.

For 2026, management expressed strong confidence in its long-term vision and execution capabilities. With mission-critical solutions increasingly enhanced by AI, Blackbaud believes it is well-positioned to capitalize on the next wave of technological innovation in partnership with its customers.

GAAP recurring revenue declined 1.8% to $290.8 million, primarily due to the divestiture of EVERFI, accounting for 98.5% of total revenue.

Non-GAAP organic revenues were up 4.3% on a reported basis and 4% on a constant-currency basis, year over year. Non-GAAP organic recurring revenues rose 4.8% on a reported basis and 4.5% on a constant-currency basis.

After the announcement, shares of the company lost around 1.2% in the trading session yesterday. Shares of the company have plunged 39.7% in the past year compared with the Zacks Computer - Software industry's decline of 7.5%.

BLKB’s Margin Details

Non-GAAP gross margin was 61.6% compared with 59.4% a year ago. Total operating expenses were significantly down from $529.8 on a year-over-year basis to $113.1 million.

GAAP operating margin increased to 20% from a negative 121.6%.

Non-GAAP operating margin increased 270 basis points to 30%. Non-GAAP adjusted EBITDA margin was 35.4%.

BLKB’s Balance Sheet & Cash Flow

As of Dec. 31, 2025, Blackbaud had total cash, cash equivalents and restricted cash of $759 million compared with $457.4 million as of Sept. 30, 2025. Total debt (including the current portion) as of Dec. 31, 2025, was $1.1 billion compared with $1 billion as of Sept. 30, 2025.

For the fourth quarter, cash provided by operating activities was $265.6 million compared with $296 million in the prior-year quarter. Non-GAAP adjusted free cash outflow was $203.6 million, down from $228.8 million in the year-ago quarter.

Blackbaud, Inc. Price, Consensus and EPS Surprise

Blackbaud, Inc. price-consensus-eps-surprise-chart | Blackbaud, Inc. Quote

As of Dec. 31, 2025, Blackbaud had roughly $961 million of remaining capacity under its expanded, replenished and reauthorized common stock repurchase program announced in December 2025.

According to current plans, the company expects total share repurchases in 2026 to represent between 5% and 10% of its outstanding common stock as of Dec. 31, 2025.

BLKB Provides 2026 Outlook

Blackbaud provided full-year 2026 financial outlook, projecting GAAP revenue in the range of $1.173 billion to $1.179 billion. The Zacks Consensus Estimate is pegged at $1.18 billion.

The company expects non-GAAP adjusted EBITDA to reach between $430 million and $438 million, with non-GAAP diluted EPS forecast at $5.15 to $5.25. The Zacks Consensus Estimate for EPS is pegged at $4.85.

Non-GAAP adjusted free cash flow is anticipated to be $280 million to $290 million.

Non-GAAP annualized effective tax rate is still anticipated to be approximately 24.5%. Blackbaud’s interest expense is estimated at $62 million to $66 million for the year.

Fully diluted shares outstanding are expected to average roughly 45.0 million to 46.0 million. Capital expenditures are projected at $60 million to $70 million, which includes $52-$62 million related to capitalized software development costs.

Recent Updates

Blackbaud strengthened its AI capabilities by partnering with Anthropic to introduce a new, purpose-built AI experience. The company highlighted AI-powered solutions and intelligent workflows during its bi-annual product update briefings, showcasing its commitment to innovation.

Further underscoring its focus on responsible business practices, the company was named in Newsweek’s list of America’s Most Responsible Companies for the fifth consecutive year.  Blackbaud continues to foster innovation in the social impact space by welcoming 11 startups into its Social Good Tech Accelerator program.

BLKB’s Zacks Rank

Blackbaud currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Performance of Other Firms

Flex Ltd. FLEX reported third-quarter fiscal 2026 adjusted earnings per share (EPS) of 87 cents, which surpassed the Zacks Consensus Estimate by 10.1%. The bottom line compared favorably with 77 cents posted in the prior-year quarter.

Revenues increased 7.7% year over year to $7.1 billion. Also, it beat the consensus mark by 3.6%. The uptick was driven by robust AI demand.

Badger Meter, Inc. BMI reported EPS of $1.14 for fourth-quarter 2025, which missed the Zacks Consensus Estimate by 0.9%. However, the bottom line compared favorably with the year-ago quarter’s EPS of $1.04. Quarterly net sales were $220.7 million, up 7.6% from $205.2 million in the year-ago quarter, driven by higher utility water sales. The Zacks Consensus Estimate was pegged at $230.8 million.

Fortive Corporation FTV reported fourth-quarter 2025 adjusted EPS of 90 cents from continuing operations, which surpassed the Zacks Consensus Estimate of 83 cents. The bottom line increased 12.5% year over year.

Revenues increased 4.6% year over year to $1.12 billion. The top line beat the Zacks Consensus Estimate by 2.6%. Core revenues jumped 3.3%.

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