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Sep 30, 2023
Blackbaud Q3 2023 Earnings Report
Blackbaud's Q3 2023 results were announced, demonstrating accelerating revenue growth and margin expansion, leading to the achievement of the Rule of 40 target ahead of schedule.
Key Takeaways
Blackbaud reported strong Q3 2023 results, with revenue growth accelerating and margin expansion exceeding expectations. The company achieved the Rule of 40 target a quarter earlier than anticipated and is well-positioned for future growth and value creation.
GAAP total revenue was $277.6 million, up 6.2% year-over-year.
GAAP recurring revenue was $269.0 million, up 7.9% year-over-year, representing 97% of total revenue.
Non-GAAP income from operations was $79.6 million, with a non-GAAP operating margin of 28.7%.
Non-GAAP free cash flow was $110.6 million, an increase of $21.2 million year-over-year, with a non-GAAP free cash flow margin of 39.8%.
Forward Guidance
Blackbaud reiterated its 2023 full year financial guidance:
Positive Outlook
- Non-GAAP revenue of $1.095 billion to $1.125 billion
- Non-GAAP adjusted EBITDA margin of 30.5% to 31.5%
- Non-GAAP earnings per share of $3.63 to $3.94
- Non-GAAP adjusted free cash flow of $190 million to $210 million
- Non-GAAP annualized effective tax rate is expected to be approximately 20%
Challenges Ahead
- Interest expense for the year is expected to be approximately $37 million to $41 million
- Fully diluted shares for the year are expected to be approximately 53 million to 54 million
- Capital expenditures for the year are expected to be approximately $65 million to $75 million, including approximately $55 million to $65 million of capitalized software and content development costs
- Net cash outlays of $25 million to $35 million for ongoing legal fees related to the Security Incident
Historical Earnings Impact
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Avg. Return Before/After Earnings
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