Blackbaud (BLKB) Down 10.6% Since Last Earnings Report: Can It Rebound?

It has been about a month since the last earnings report for Blackbaud (BLKB). Shares have lost about 10.6% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Blackbaud due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for Blackbaud, Inc. before we dive into how investors and analysts have reacted as of late.

Blackbaud's Q4 Earnings Beat Estimates

Blackbaud 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.

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%.

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.

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.

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 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.

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 million to 46 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.

How Have Estimates Been Moving Since Then?

It turns out, estimates revision flatlined during the past month.

VGM Scores

Currently, Blackbaud has a nice Growth Score of B, a score with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a score of A on the value side, putting it in the top 20% for value investors.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Blackbaud has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

Performance of an Industry Player

Blackbaud is part of the Zacks Computer - Software industry. Over the past month, Microsoft (MSFT), a stock from the same industry, has gained 0.1%. The company reported its results for the quarter ended December 2025 more than a month ago.

Microsoft reported revenues of $81.27 billion in the last reported quarter, representing a year-over-year change of +16.7%. EPS of $4.14 for the same period compares with $3.23 a year ago.

For the current quarter, Microsoft is expected to post earnings of $4.05 per share, indicating a change of +17.1% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.

Microsoft has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.

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