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What were the key takeaways from Blackbaud's earnings call?

- **Revenue Growth**: Q3 2025 revenue $281M (+5.2% organic), with 35.4% EBITDA margin and $1.10 EPS (+11% YoY).
- **AI Innovation**: 'Agents for Good' suite launched, starting with Development Agent, driving 40% customer adoption.
- **Cash Flow & Buybacks**: $125M Q3 free cash flow, targeting $195M-$205M for 2025, with 5.2%-7% stock buyback.
- **Tax Benefits**: $60M one-time 2025 tax impact, supporting long-term margin expansion.

**【Management Opening Remarks】**
- CEO Mike Gianoni highlighted Q3 2025 results: $281M revenue (+5.2% organic), 35.4% adjusted EBITDA margin, $1.10 non-GAAP EPS (+11% YoY), and $125M free cash flow.
- Emphasized AI-driven innovation, new logo wins (e.g., St. Mary's College), and cross-sell opportunities (e.g., Concordia College 5-year agreement).
- CFO Chad Anderson noted $195M-$205M free cash flow guidance, driven by tax savings and innovation investments.

**【CEO Commentary】**
- **AI Strategy**: Launched 'Agents for Good' suite, starting with Development Agent for donor engagement. Early adopters saw quick ROI, with 40% of customers adopting new AI tools.
- **Growth Drivers**: Mid-single-digit organic revenue growth, 7% EBITDA growth, and 11% EPS growth. Target Rule of 40+ with 40.5% midpoint for 2025.
- **Operational Efficiency**: 10% share reduction since Q4 2023, aiming for 5.2%-7% stock buyback in 2025.

**【CFO Commentary】**
- **Financial Performance**: Q3 non-GAAP EPS $1.10, +11% YoY; free cash flow $125M (+28% YoY). 2025 guidance: $1.12B-$1.13B revenue, 35.4%-36.2% EBITDA margin.
- **Tax Benefits**: One Big Beautiful Bill Act to reduce cash taxes, with $60M one-time 2025 working capital impact.
- **Investments**: $7M in AI/Q3-Q4, supporting long-term growth and 35.4%+ EBITDA margin.

**【Q&A Highlights】**
- **AI Adoption**: Development Agent monetization begins Q4 2025, with SaaS subscription model. Customers see immediate ROI via donor engagement.
- **New Logos**: 40% ARR increase in multi-solution deals; 3-year+ contracts (90% renewals with price hikes). Customer count stable at ~40,000.
- **Tax Restatement**: Immaterial noncash error corrected, with no impact on 2025 guidance.
- **Gross Margin**: AI solutions expected to improve margins via operational efficiency and new revenue streams.

Blackbaud, Inc. (BLKB) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

BLKB

BLKB fundamentals

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