CHARLESTON, S.C., Feb. 13, 2023 /PRNewswire/ — Blackbaud (NASDAQ: BLKB), the world’s leading cloud software company powering social good, today announced financial results for its fourth quarter and full year ended December 31, 2022.
“2022 was a year of substantial progress,” said Mike Gianoni, president and CEO, Blackbaud. “We proactively took steps throughout the year to better position the company, manage it efficiently and effectively in a weakened economy, and drive profitability, cash flow and improvement on Rule of 40. Revenue surpassed the $1 billion mark for the first time in our company history, and we achieved 14% revenue growth year over year. Looking ahead, we are building on the strong execution in 2022 and remain focused on driving efficiencies and improvements across the business as we progress along our Rule of 40 journey. At the midpoint of our full year 2023 financial guidance ranges, we anticipate organic revenue growth at constant currency of 4%, adjusted EBITDA margin of 30% and Rule of 40 at constant currency of roughly 34%, up five points versus last year. We are confident in our outlook with plans in place to achieve substantial performance acceleration as the year progresses and deliver significant, enhanced shareholder value.”
Fourth Quarter 2022 Results Compared to Fourth Quarter 2021 Results:
- GAAP total revenue was $274.8 million, up 10.8%, with $265.2 million in GAAP recurring revenue, up 11.1%.
- Non-GAAP organic recurring revenue increased 1.3%.
- GAAP loss from operations was $15.5 million, inclusive of security incident-related costs, net of insurance recoveries of $26.5 million, with GAAP operating margin of (5.7)%, a decrease of 300 basis points.
- Non-GAAP income from operations was $54.9 million, with non-GAAP operating margin of 20.0%, an increase of 20 basis points.
- GAAP net loss was $21.3 million, with GAAP diluted loss per share of $0.41, down $0.26 per share.
- Non-GAAP net income was $36.0 million, with non-GAAP diluted earnings per share of $0.68, down $0.07 per share.
- Non-GAAP adjusted EBITDA was $67.9 million, up $7.2 million, with non-GAAP adjusted EBITDA margin of 24.7%, an increase of 20 basis points.
- GAAP net cash provided by operating activities was $14.1 million, a decrease of $29.8 million.
- Non-GAAP adjusted free cash flow was $7.6 million, a decrease of $24.3 million, with non-GAAP adjusted free cash flow margin of 2.8%, a decrease of 1,010 basis points.
“We had a solid end to a strong 2022, meeting or exceeding full year financial guidance across revenue, profitability and adjusted free cash flow,” said Tony Boor, executive vice president and CFO, Blackbaud. “For the full year 2022, Rule of 40 at constant currency was 29%, a two-point improvement over 2021. We drove strong cash generation throughout the year and will continue to rapidly deleverage in the near term. In 2023, we expect an acceleration in our financial performance as the year progresses, starting with meaningful improvement in the second quarter. We remain intently focused on managing costs and delivering substantial margin expansion and earnings potential with actions under management control. We will continue to drive operational execution across our business that we believe will accelerate Rule of 40 as the year progresses, giving further confidence in our ability to reach 40% in the next few years.”
An explanation of all non-GAAP financial measures referenced in this press release, including the Rule of 40, is included below under the heading “Non-GAAP Financial Measures.” A reconciliation of the company’s non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release.
Recent Company Highlights
- Blackbaud was named to Newsweek’s list of America’s Most Responsible Companies 2023. Blackbaud is one of 500 companies on the list, which highlights leaders in corporate responsibility, spanning 14 industries.
- Blackbaud appointed two new directors to its board. Yogesh K. Gupta, president and CEO, Progress Software Corporation, and Rupal S. Hollenbeck, chief commercial officer, Check Point Software Technologies, joined Blackbaud’s board of directors. In addition, Timothy Chou, Ph.D., and Joyce M. Nelson retired from the Blackbaud board.
- Blackbaud named Chad Anderson chief accounting officer. Prior to this role, Anderson served Blackbaud as senior vice president and corporate controller.
- Blackbaud supported bold technology innovation through its Social Good Startup Program. Startups in the 2022 program recently visited Blackbaud’s world headquarters in December for an annual showcase, sharing their ideas on ways to impact the social good community. Additionally, Blackbaud welcomed its six newest members to the Social Good Startup Program with the January 2023 cohort.
- Blackbaud CEO Mike Gianoni was named to Charleston Business Magazine’s 50 Most Influential Hall of Fame, making the list of 50 Most Influential People for the fifth year.
- Blackbaud was honored as a Leading Employer by Built In’s 2023 Best Places to Work Awards and RippleMatch’s 2023 Campus Forward Awards.
- Blackbaud announced a major gift to support diversity, equity and inclusion globally in partnership with five organizations in each of the regions it operates.
Visit www.blackbaud.com/newsroom for more information about Blackbaud’s recent highlights.
Full-Year 2022 Results Compared to Full-Year 2021 Results:
- GAAP total revenue was $1.1 billion, up 14.1%, with $1.0 billion in GAAP recurring revenue, up 14.9%.
- Non-GAAP organic recurring revenue increased 4.0%.
- GAAP loss from operations was $28.5 million, with GAAP operating margin of (2.7)%, a decrease of 540 basis points.
- Non-GAAP income from operations was $202.6 million, with non-GAAP operating margin of 19.1%, a decrease of 250 basis points.
- GAAP net loss was $45.4 million, with GAAP diluted loss per share of $0.88, down $1.00 per share.
- Non-GAAP net income was $140.4 million, with non-GAAP diluted earnings per share of $2.69, down $0.35 per share.
- Non-GAAP adjusted EBITDA was $262.6 million, up $16.5 million, with non-GAAP adjusted EBITDA margin of 24.8%, a decrease of 170 basis points.
- GAAP net cash provided by operating activities was $203.9 million, a decrease of $9.8 million.
- Non-GAAP adjusted free cash flow was $153.7 million, a decrease of $14.6 million, with non-GAAP free cash flow margin of 14.5%, a decrease of 360 basis points.