Blackbaud (BLKB) Q1 2026 earnings summary

Executive summary

• Delivered solid execution in Q1 2026, focusing on efficiency, product innovation, and leadership in AI-powered social impact software, with the launch of the first agentic AI product generating strong early demand and customer interest.

• Maintained global market leadership in AI-powered solutions for social impact, serving a diverse customer base across multiple verticals and achieving new customer wins and expanded sales to existing customers.

• Over 20% of renewing customers opted for four-year or longer contracts, indicating strong customer engagement and high retention rates.

• Continued investment in AI for both customer-facing products and internal operations, with plans for additional agentic AI solutions and ongoing innovation.

• Focused on purposeful capital allocation, including significant share repurchases and debt reduction.

Financial highlights

• Q1 2026 revenue was $281.1M, up 4.2% year-over-year; recurring revenue grew 5.0% and accounted for 98% of total revenue.

• Non-GAAP adjusted EBITDA reached $98.7M (35.1% margin), up $6.6M year-over-year, with a 1 percentage point margin improvement.

• Non-GAAP EPS increased 20% to $1.14 from $0.95 last year; non-GAAP net income was $52.6M.

• Free cash flow rose nearly $50M year-over-year to $37M in Q1; operating cash flow was $51.5M, up from $1.4M in Q1 2025.

• Gross margin improved to 59.2% GAAP and 62.7% non-GAAP; net income was $31.1M ($0.67 diluted EPS).

Outlook and guidance

• Reaffirmed full-year 2026 guidance: GAAP revenue $1.173B–$1.179B, non-GAAP adjusted EBITDA $430M–$438M, non-GAAP EPS $5.15–$5.25, and free cash flow $280M–$290M.

• Anticipates quarterly performance to be weighted toward the back half of the year, especially Q4.

• Targeting double-digit annual EPS growth from 2026 to 2030, with 17% non-GAAP EPS growth expected in 2026 and long-term non-GAAP EPS CAGR goal of 13%+.

• Plans to allocate at least 50% of cumulative free cash flow from 2026–2030 to share repurchases.

• Interest expense for full year 2026 projected at $62–66M; non-GAAP tax rate ~24.5%.