Blackbaud, Inc. BLKB reported fourth-quarter 2024 non-GAAP earnings per share (EPS) of $1.08, which was in line with the Zacks Consensus Estimate. The bottom line decreased 5.3% year over year.
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Total revenues jumped 2.5% year over year to $302.2 million. The top line missed the Zacks Consensus Estimate by 0.9%.
Total recurring revenues (contributed 98% to total revenues) in the reported quarter amounted to $296.2 million, up 3.1% year over year. One-time services and other revenues (2% of total revenues) were $6 million, down 21%.
Non-GAAP organic revenues were up 3.2% on a reported basis and 2.9% on a constant-currency basis, year over year. Non-GAAP organic recurring revenues rose 3.1% on a reported basis and 2.8% on a constant-currency basis, year over year.
On Jan. 3, 2025, Blackbaud officially announced the sale of its EVERFI business to an independent private investment firm. The transaction, finalized on Dec. 31, 2024, followed a thorough strategic review process and was closed for a nominal amount. In 2024, EVERFI business contributed $85.5 million to revenues. With its divestiture, corporate sector revenues will no longer be reported separately, and YourCause revenues will be merged with other products into a single revenue line.
In response to the results, BLKB’s shares were down 11.2% and closed the session at $70.96 on Feb. 18. Shares of the company have lost 8.7% in the past six months against the Zacks Computer - Software industry's growth of 2.9%.
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BLKB’s Margin Details
Non-GAAP gross margin was 60% compared with 59.9% a year ago. Total operating expenses surged 319% on a year-over-year basis to $531.5 million. This was due to EVERFI impairment and disposition charges of $405.4 million.
GAAP operating loss amounted to $283.2 million, including total pre-tax impairment and disposition charges related to EVERFI.
Non-GAAP operating margin fell 100 basis points (bps) to 27.4%. Non-GAAP adjusted EBITDA margin was 33.8%, up 20 bps year over year.
BLKB’s Balance Sheet & Cash Flow
As of Dec. 31, 2024, Blackbaud had total cash, cash equivalents and restricted cash of $809.5 million compared with $462.7 million as of Sept. 30, 2024. Total debt (including the current portion) as of Dec. 31, 2024, was $1.1 billion compared with $1 billion as of Sept. 30, 2024.
For the fourth quarter, cash provided by operating activities was $73.6 million against cash used $3.3 million in the prior-year quarter. Non-GAAP adjusted free cash flow was $57.3 million, up from $36.3 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, 2024, Blackbaud had nearly $645 million available under its stock buyback program, which was expanded and renewed in July 2024. In 2024, the company repurchased about 10% of the common stock that was outstanding.
In 2025, Blackbaud plans to continue to repurchase between 3% and 5% of its outstanding shares.
BLKB Initiates 2025 Outlook
Blackbaud provided guidance for full-year 2025. The company projects GAAP revenues between $1.115 billion and $1.125 billion. The Zacks Consensus Estimate is pegged at $1.219 billion.
The company projects non-GAAP adjusted EBITDA margin in the range of 34.9-35.9%. Non-GAAP EPS is anticipated to be between $4.16 and $4.35. The Zacks Consensus Estimate for EPS is pegged at $4.50.
Non-GAAP adjusted free cash flow for 2025 is forecasted to be in the range of $185-$195 million.
Non-GAAP annualized effective tax rate is anticipated to be approximately 24.5%. Interest expense is expected in the band of $65 million to $69 million.
Fully diluted shares are estimated to be 48.5 million to 49.5 million. Capital expenditures are expected to be in the range of $55 million to $65 million, which includes $50-$60 million of capitalized software and content development costs.
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.
Performance of Other Firms in Computer-Software Industry
Open Text Corporation OTEX reported second-quarter fiscal 2025 adjusted EPS of $1.11, compared with $1.24 a year ago. The figure outpaced the Zacks Consensus Estimate of 92 cents per share.
In the past year, shares of OTEX have declined 29%.
Commvault Systems CVLT reported third-quarter fiscal 2025 results wherein adjusted earnings of 94 cents per share beat the Zacks Consensus Estimate of 87 cents. The figure compares with earnings of 78 cents per share a year ago. Quarterly revenues jumped 21% year over year to $ $262.6 million. Subscription revenues were $158.3 million, up 39% year over year.
In the past year, CVLT shares have gained 39%.
Microsoft MSFT reported second-quarter fiscal 2025 earnings of $3.23 per share, which beat the Zacks Consensus Estimate by 3.86% and increased 10.2% on a year-over-year basis.
Shares of MSFT have inched up 1.6% in the past year.
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