BLACKBAUD INC (BLKB) Business

ITEM 1. BUSINESS

Description of Business

We are the world's leading provider of AI-powered solutions for social impact. Serving nonprofits, educational institutions, companies committed to corporate social responsibility and individual change makers, we propel impact at scale with the sector’s most intelligent solutions for fundraising and engagement, education solutions, financial management and CSR and grantmaking. With the deepest expertise powered by the world’s largest philanthropic data set, the most connected workflows, and the most powerful impact network, our solutions are building a future where resources are unleashed at the speed of need. Blackbaud brings over four decades of leadership to this sector: since originally incorporating in New York in 1982 and later reincorporating as a South Carolina corporation in 1991 and as a Delaware corporation in 2004. We are deeply proud to play a part in our customers’ success in their missions to provide healthcare and cure diseases, advance education, preserve and share arts and culture, protect the environment, support those in need and much more.

Market Overview

The social impact market is significant, spanning far beyond philanthropy, and our addressable market is substantial

There are millions of organizations globally focused on social impact including nonprofits, foundations, education institutions and healthcare organizations. In the corporate sector, demonstrating positive social impact has become a business imperative. Countless individuals also engage in social impact by donating funds, volunteering their time, advocating for a cause, receiving services from or otherwise engaging with social impact organizations.

Traditional methods of fundraising and organizational management are often costly and inefficient

Many social impact organizations use manual methods or software applications not specifically designed for fundraising or nonprofit business operations. Such methods are often costly and inefficient because of the difficulties in effectively collecting, sharing and using donation-related information. Furthermore, general purpose software applications frequently have limited functionality for the unique needs of our customer base and do not efficiently integrate multiple databases or solutions from multiple vendors. Some social impact organizations have developed proprietary software, but doing so is expensive, requiring on-site technical personnel for development, implementation and maintenance.

The nonprofit industry faces particular operational challenges

Nonprofit organizations—and any other entity that includes fundraising as a revenue source, including education institutions, healthcare organizations and houses of worship—must efficiently:

•Solicit funds and build relationships with major and institutional donors;

•Garner small cash contributions from numerous contributors;

•Manage and develop complex relationships with large numbers of constituents;

•Communicate their accomplishments and the importance of their mission online and offline;

•Comply with complex accounting, tax and reporting requirements that differ from those for for-profit businesses;

•Solicit cash and in-kind contributions from businesses to help raise money or deliver products and services;

•Provide a wide array of programs and services to individual constituents and beneficiaries; and

•Improve the data collection and information sharing capabilities of their employees, volunteers and donors by creating and providing distributed access to centralized databases.

Because of these challenges, we believe nonprofits, education institutions, healthcare organizations and houses of worship can benefit from AI-powered software applications and services and specifically designed to serve their particular needs and workflows to grow revenue, work effectively and accomplish their missions.

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Companies, grantmaking institutions and foundations also face unique challenges

Companies, grantmaking institutions and foundations, face their own unique challenges in their social impact efforts, including the need to:

•Quantify and improve the impact of their grants;

•Cultivate better relationships with grantees;

•Achieve better internal collaboration and alignment with board members, reviewers and other stakeholders;

•Illustrate the impact of their corporate philanthropy and education efforts to the communities they serve;

•Engage employees in meaningful volunteering, giving and other activities;

•Ensure that their philanthropic efforts align with their business initiatives;

•Manage all of a foundation's activities, including fundraising and accounting;

•Expand the reach of their fundraising efforts; and

•Cultivate new and existing donors.

Strategy

Our objective is to maintain and extend our position as the leading provider of AI-powered cloud software and services essential for the core business operations unique to social impact organizations, teams, and schools. Our key strategies for achieving this objective are described below.

Operating Initiatives Supporting Long-Term Growth and Margin Improvement

•Product Innovation and Delivery

A central element of our long‑term strategy is the disciplined integration of AI across our products, platform and internal operations, which management views as foundational to driving operating leverage, enhancing customer outcomes and supporting sustainable growth over time.

Our product innovation efforts have focused on two primary areas: (i) advancing AI across the portfolio, and (ii) enhancing product connectivity and interoperability to streamline customer workflows. These enhancements are designed to help customers improve fundraising outcomes while reducing administrative burden.

Through our multi-year Intelligence for Good® initiative, we continue to integrate machine learning and AI-driven capabilities into our products to improve efficiency and support better outcomes for our customers. Our machine learning features for prospect identification have been adopted by more than half of Raiser's Edge NXT® customers. We have also introduced generative AI features across multiple products, primarily supporting the composition of donor and constituent communications.

In late 2025, we released Blackbaud AI Chat, which provides contextual responses within our solutions and assists users in completing tasks more efficiently. At bbcon®, our annual user conference in October 2025, we launched Agents for Good™, our agentic AI suite, designed to augment customer teams with virtual AI-driven assistants capable of autonomously executing complex workflows across fundraising, finance and corporate impact functions. These innovations expand the ways customers can use our AI-powered solutions and are expected to contribute to future bookings, product adoption and customer retention.

•Targeting Mid-Single-Digit Revenue Growth

Contractual Recurring Revenue (~64% of total revenue)

Contractual recurring revenue is driven by new‑customer bookings, cross‑sell and upsell activity within our existing customer base and the retention of existing customer revenue. Our sales organization includes teams focused on both new logo acquisition and expansion within existing customers. In addition to these motions, our new product opportunities (such as Agents for Good discussed above) provide our customer account teams with incremental solutions

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to sell into existing customers. These three motions—new logo, cross-sell/upsell, and new product—support our multi-year “land and expand” strategy.

Most of our software customers now operate on standard three‑year contract terms with mid-to-high single-digit price increases at renewal and embedded annual price increases. These terms provide improved revenue visibility and are expected to contribute to stability in retention rates. Revenue from these arrangements is generally recognized ratably over the contract term.

While our contract renewal program is designed around three‑year terms, more than 20% of renewing customers have elected to enter into four‑year or longer contracts. Accordingly, our customer base is primarily composed of three‑year contracts, with over 20% of customers committed under extended‑term arrangements, which contributes to revenue visibility while extending the duration over which renewals occur.

Because revenue from these contractual arrangements is recognized ratably over the contract term, changes in contract duration affect the period over which revenue is recognized but do not change the pattern of revenue recognition within the contract. To the extent contracts include embedded annual price escalators, the total fees attributable to the subscription-based software solutions are recognized on a straight-line basis over the term of the arrangement, resulting in a more even pattern of revenue recognition over longer periods. Accordingly, period‑over‑period revenue growth continues to be driven primarily by the retention of existing customer revenue, combined with new bookings, expansion activity and contractual renewals with price increases and embedded annual price escalators over the contractual term. Extended‑term arrangements contribute to improved visibility into future revenue and cash flows.

Renewal performance can vary from year to year due to the size and composition of renewal cohorts. Approximately 40% of our existing customer contracts are due for renewal in 2026, compared to approximately 30% in 2027 and approximately 30% in 2028. The contractual annual recurring revenue dollars up for renewal associated with the 2026 renewal cohort are approximately 40% higher than those up for renewal in 2025, reflecting the normal progression of our multi-year contract renewal cycle and the timing of customer renewals. Because the 2026 cohort is meaningfully larger, we may experience higher churn dollars in that year relative to prior years. These cohort dynamics are a normal part of our renewal cycle and can influence year-over-year revenue trends, even when underlying customer retention patterns remain stable.

Transactional Recurring Revenue (~34% of total revenue)

Transactional recurring revenue is diversified across multiple activity types. The primary components of this revenue stream—and their associated products—include:

◦Donation Processing (~55%) - support by Blackbaud Integrated Payments™, which powers donation activity across our fundraising and CRM solutions.

◦Consumer Giving (~20%) - driven by JustGiving®, which facilitates individual, peer-to-peer and community-driven giving.

◦Tuition Management (~20%) - generated through Blackbaud Tuition Management™, which processes tuition, fees and related financial transactions for K-12 private schools.

◦Event‑based Usage (~5%) - derived from usage-based transactions across certain registration, ticketing and event-related workflows within our product suite.

The diversity of these underlying transaction types has contributed to consistent high-single-digit growth in transactional recurring revenue in recent years. In certain periods, transactional recurring revenue may benefit from temporary increases in charitable giving related to isolated events, which can contribute to short‑term variability in transaction volumes. Future growth in this category will depend on volume (e.g., donation activity, giving behavior, tuition payments), same‑store volume trends, the shift toward donor online giving, customer adoption of our payments capabilities and pricing optimization initiatives.

Certain components of transactional revenue—as with the broader social good sector—are influenced by external factors such as giving patterns, macroeconomic conditions and seasonal activity.

We have experienced continued growth in donation processing, consumer giving and tuition management, have implemented targeted rate increases across select areas of our payments portfolio, and are executing additional

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optimization initiatives intended to enhance the donor experience and support long-term transactional revenue expansion.

•Operating Efficiency and Margin Improvement

We are focused on improving operating efficiency and enhancing profitability over time. This includes actions to optimize our workforce, improve productivity, modernize our technology platform and simplify our cost structure. Consistent with this focus, we are applying AI across our internal operations as a tool to support productivity, scalability and operational effectiveness over time.

We have taken several steps to improve efficiency in recent years, including reductions in headcount, optimization of our real estate footprint, renegotiation of key vendor contracts, continued migration of our product infrastructure to public cloud environments and planned closure of our two remaining legacy private data centers. We are also deploying AI-enabled tools across our internal operations, including research and development, customer operations and general and administrative functions, to automate routine activities, accelerate workflows and support internal productivity, while maintaining appropriate controls and governance.

As part of our multi-year global workforce strategy, we are expanding our global footprint through the continued build-out of our Global Capability Center ("GCC") in Hyderabad, India. This expansion enhances our access to talent, enables labor arbitrage while maintaining a high quality of work, and supports a follow-the-sun operating model. Our adoption of AI complements this strategy by informing how we assess roles, skill requirements and productivity opportunities as our operating model evolves.

Beginning in 2024, we have relied on a combination of (i) insourcing certain roles previously performed by third parties into the GCC, (ii) evaluating roles and required skill sets, and opportunities created through our adoption of AI to determine whether positions that become vacant through attrition should be backfilled within the GCC, and (iii) opportunistically transitioning additional roles to the GCC. We expect to continue this approach as we execute the next phase our global workforce strategy through 2027.

•Stock repurchase program

On December 1, 2025, our Board of Directors reauthorized, expanded and replenished our stock repurchase program by raising the total capacity under the program from $800.0 million to $1.0 billion available for repurchases. The program does not have an expiration date and authorizes the repurchase of shares from time to time in accordance with applicable laws, including through open market transactions, transactions under Rule 10b5-1 trading plans, and privately negotiated transactions. The timing and amount of repurchases are determined based on a variety of factors, including market and business conditions, the trading price of our common stock and alternative uses of capital, and the program may be limited, suspended or discontinued at any time without prior notice.

On December 2, 2025, we announced an increase in our expected fiscal year 2025 stock repurchase range to between 7.0% and 8.5% of our outstanding common stock as of December 31, 2024. During the year ended December 31, 2025, we repurchased 3,337,844 shares for $214.0 million. Including net share settlement of employee stock compensation, these repurchases represented approximately 7.9% of our outstanding common stock as of December 31, 2024. As of December 31, 2025, $960.6 million remained available for repurchases under the program. During 2026, we intend to repurchase between 5.0% and 10.0% of our outstanding common stock as of December 31, 2025 under our existing stock repurchase program. Over the long term, we expect stock repurchases to remain an important component of our capital allocation strategy, subject to market conditions, business performance, leverage considerations, and other factors. We anticipate utilizing at least 50% of our free cash flow from 2026 to 2030 for stock repurchases. See “Management’s Discussion and Analysis of Financial Conditions and Results of Operations—Non-GAAP Financial Measures” in Item 7 of this report.

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Delight Our Customers

We intend to make our customers' experience with us effective, efficient and satisfying from their initial interest in our AI-powered solutions and services through their decision to purchase, engage with customer support and implement and use our solutions. We continue to focus on initiatives aimed at improving the consistency and quality of user experience across our offerings. We also continue to evolve the way we package and sell our offerings to provide high quality and value combined with flexibility to meet the unique needs of our existing and prospective customers. In addition, we are continuing to integrate value-adding capabilities such as payment services, analytics and business intelligence into our suite of solutions to better address our customers' needs to raise more revenue with comprehensive offerings. We will continue to focus on providing the highest level of solution support, enhancing our existing solutions, extending our solutions through open APIs and developing new solutions and services designed to help our customers be more effective and achieve their missions. (See “Solutions and Services” below for additional information regarding the development and integration of AI into our solutions and services as a key business strategy.)

Attract and Retain Top Talent and Actively Engage Employee Base

Our employees are energized by our opportunity to fuel social impact. Collaboration, innovation, authentic passion for the customers we serve and high standards are core to our culture and help to enable the great work we do. We strive to hire, develop and retain the best employees and provide a supportive and inclusive environment where their talents and potential are realized. In 2025, we rolled out an updated approach to our Remote-Flexible workforce strategy, which supports Blackbaud's goal to attract and develop top talent globally. For additional information, see “Human Capital Resources” below.

Drive Strength in Our Sector as an Industry Thought Leader

In our over 40 years of operation, we have gained significant insight into the overall market and industry segments in which we operate. We produce a wide range of thought leadership resources, including blogs, webinars and white papers, which provide insights and guidance to the social impact community. We also participate in and convene industry forums, where we exchange views and engage with industry and government leaders. Our annual user conference, bbcon®, serves in part as a forum to offer thought leadership to our customers, as do other market-specific user conferences, events and customer gatherings. The Blackbaud Institute is a research lab that leverages Blackbaud's unique data resources, along with original research, to drive insight that accelerates the impact of the social impact community. The research and reports the Blackbaud Institute produces serve to strengthen the social impact community as a whole. ENGAGE, our blog and podcast, provides free best practices resources that drive impact across the social impact community, as well.

The Blackbaud Social Good Startup Program is a year-long accelerator designed to support innovative startups with the potential to drive social impact. In alignment with our commitment to diversity in the tech community, we emphasize supporting founders from underrepresented backgrounds.

Solutions and Services

We propel our customers’ impact through what we believe to be the sector’s most intelligent AI-powered solutions for giving, connecting and engaging. Our solutions combine deep expertise, end-to-end connection for sector-specific workflows and access to the Blackbaud Verified Network. We have evolved beyond providing the critical systems of record to also provide systems of intelligent action.

We augment our software with a range of payment processing, analytic and business intelligence services, consulting, training and professional services, as well as maintenance and technical support. The Blackbaud portfolio is delivered primarily through cloud solutions tailored to the unique needs of nonprofits and foundations, educational institutions, individual change makers and corporate social impact programs. Our AI-powered solutions are built specifically for fundraising and relationship management, marketing and engagement, financial management, grant and award management, education management, ticketing, social responsibility, payment services and analytics.

We are developing and implementing AI features in certain of our solutions and services as a key element of our strategy to enhance customer workflows, improve operational efficiency and support decision-making, while maintaining appropriate human oversight and governance controls. For example, our “Intelligence for Good” program integrates machine learning and AI capabilities that help our customers streamline workflows, enhance efficiency and achieve better outcomes. We have introduced generative AI features across multiple products, ranging from composition of outreach communications to contextual responses to customer questions. We are also leveraging AI to transform the way we work at Blackbaud and intend

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to continue to identify, experiment and scale a range of solutions across our marketing, customer success, engineering and general and administrative functions through applied AI.

AI is a core pillar of our long‑term business strategy and operating model, rather than a standalone innovation initiative, and underpins how we enhance our solutions, scale our platform, improve operating efficiency and deliver sustained value to our customers.

We are committed to developing and using AI responsibly and in accordance with rapidly developing laws and regulations, including with regard to the processing of personal data. The technologies underpinning these features are in the early stages of commercial use, and we are mindful that the success of any enhancements or new products depends on many factors, including its relevance to our customers, timely implementation and market acceptance. In addition, we regularly monitor new regulatory developments in applicable jurisdictions in order to identify and mitigate ethical and legal issues presented by our use of AI. Furthermore, many of our AI features may rely on third-party service providers, which requires that we continuously evaluate the quality and legality of their products and operations, as well as copyright and intellectual property issues. Our commitment to new and emerging AI technologies requires that we invest in the development and maintenance of various models, approaches and processes, as well as the development of protections and safeguards for the use of AI technologies and requires that we hire persons with specialized expertise. As a result, we regularly monitor all aspects of our AI strategy to ensure that it is implemented in a manner consistent with our enterprise risk management processes and other company policies and procedures. (See “Risk Factors” below for more information regarding the risks associated with our use of AI and the description below of our current uses of AI in our solutions and services.)

For purposes of this Annual Report on Form 10‑K, we use the term “Artificial Intelligence” or “AI” as defined by the National Institute of Standards and Technology (“NIST”). Under the NIST definition, AI refers to a machine‑based system that can, for a given set of human‑defined objectives, make predictions, recommendations, or decisions that influence real or virtual environments. These systems use machine- and human‑based inputs to perceive their environments, analyze data and generate outputs that support or automate decision‑making.

As adopted by the Company, this definition applies consistently throughout our disclosures in Item 1. Business, Item 1C. Cybersecurity and Item 7. Management’s Discussion & Analysis, and should be read in conjunction with our related risk, operational and governance discussions.

Our specific solutions and services include:

Data Intelligence

Intelligence for Good® is our comprehensive strategy to deliver AI that is convenient, powerful and responsible. Our AI capabilities enable social impact organizations to transform data into insights and outcomes.

Our data intelligence offerings provide solutions for data health, predictive insights and fundraising performance, enabling nonprofits to define effective campaign strategies and maximize fundraising results. These services either integrate with or are already integrated into our software solutions to give our customers a comprehensive view of their supporters and the market and provide information essential to making well-informed operating decisions.

Blackbaud's data intelligence solutions and services use data science and AI to turn customer data into valuable insights that inform decision-making and help them achieve their goals efficiently. Blackbaud's data intelligence portfolio consists of four key outcome areas:

Blackbaud Agents for Good™ are a series of AI agents that leverage Blackbaud’s proprietary data and sector expertise to act as staff support or “virtual team members” by autonomously executing complex workflows for nonprofits and leveraging proven processes to accomplish a specific set of outcomes. Within prescribed guardrails, agents run tasks, leverage data to optimize those tasks, log the actions they take and report on the success of their actions.

Predictive Insights inform strategic decision-making and actions that increase efficiency and drive successful outcomes. Insights are extracted by combining customer data with licensed and proprietary data before leveraging advanced AI capabilities and expertise from Blackbaud’s dedicated team of data scientists. Examples of constituent insights include: predictive modeling that indicates the likelihood and capacity of a constituent making a gift, wealth screening software that uses publicly available records to build detailed wealth profiles of constituents and persona cluster segmentation that groups constituents based on shared traits with guidance for optimizing messaging to each group.

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Data Health solutions enhance and maintain constituent data so the customer is always working with accurate and up-to-date information. Examples of these solutions include: identifying outdated or invalid constituent addresses in the database and making corrections based on United States Postal Service data and using name and address matching to append additional contact or demographic data points to constituent records to support better segmentation and engagement.

Fundraising Performance solutions help customers to assess their fundraising performance across donor segments, benchmark themselves against peer organizations and understand industry trends. These solutions provide a holistic view of donor performance that goes beyond standard campaign-based reporting, with key performance indicators related to acquisition, upgrading, retention and reactivation. Customers use our performance solutions to identify areas of weakness and opportunities for improvement, track the donor impact of strategic initiatives, understand and respond to industry trends, set realistic benchmarks and fundraising goals and maintain a consistent reporting methodology to assess growth over time.

Fundraising and Engagement

Blackbaud Raiser's Edge NXT® is our flagship fundraising and relationship management solution. Raiser's Edge NXT is the first and only cloud fundraising and relationship management solution that is all-inclusive, fully integrated with data health, AI-powered predictive analytics, email marketing, donation forms, event management, payment processing and process automation to create tailored, user-specific experiences. We believe Raiser's Edge NXT is the most advanced technology available to nonprofits seeking to operate more efficiently and raise more support for their missions.

Blackbaud Enterprise Fundraising CRM™ is a comprehensive, configurable fundraising and relationship management solution. It is our lead offering for enterprise-level organizations seeking a powerful, yet adaptable solution for fundraising, marketing and program management across the engagement lifecycle, specializing in supporting sophisticated major giving, membership and high-volume direct marketing programs. Blackbaud Enterprise Fundraising CRM helps organizations build deeper and more personalized relationships with constituents, build their brands through online engagement and multichannel communication tools, and more effectively fundraise, leveraging campaign management, business intelligence and predictive analytics. Blackbaud Enterprise Fundraising CRM can be integrated with enterprise online solutions to enable multi-channel marketing, online engagement and event fundraising.

Blackbaud Luminate Online®, delivered in the cloud, helps our customers better understand their online supporters, make the right ask at the right time and raise more money online. It includes tools to build online fundraising campaigns as part of an organization's existing website or as a stand-alone fundraising site. Donation forms, gift processing and tools for communicating through web pages and email give our customers the essentials for building sustainable donor relationships.

Blackbaud TeamRaiser® is the industry’s most comprehensive peer-to-peer fundraising event solution. Powering thousands of major events each year, TeamRaiser allows nonprofits’ supporters to create personal or team fundraising web pages and send email donation appeals in support of events such as walks, runs and rides.

JustGiving® from Blackbaud® is a world-class social fundraising platform for online peer-to-peer giving. JustGiving provides innovative tools enabling individuals to engage their own peer networks to raise donations directly for the causes they care most about. By making giving simpler and putting storytelling in the hands of fundraisers, JustGiving helps individuals reach more people to raise more money for charities of all sizes.

Blackbaud Fundraiser Performance Management™ is a multi-pronged solution that augments the capabilities of an organization’s primary database with flexible, detailed and transparent goal and action tracking. Built for higher education institutions, healthcare and large nonprofit organizations with structured gift officer teams, the solution combines a dedicated SaaS platform for gift officer tracking with a dedicated business consultant. Both fundraisers and leaders benefit from tailored consulting to address weaknesses and enhance strengths to comprehensively improve fundraising team performance.

Blackbaud Altru® is a cloud solution that helps arts and cultural organizations consolidate admissions, membership, fundraising, merchandise, marketing and more, giving users a comprehensive view of their supporters. By helping general admissions arts and cultural organizations gain a clear, 360-degree view of their organization, it enables them to operate more efficiently, engage and cultivate patrons and supporters, streamline external and internal communication efforts, and reduce IT costs. Blackbaud Altru contains tools for constituent and membership management, program sales, retail sales and ticketing, volunteer management and events management. It also has sophisticated reporting functionality and tools to manage marketing, communications and fundraising.

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Financial Management

Blackbaud Financial Edge NXT® is the market leading solution for fund and sub fund accounting to ensure stewardship for donated funds and compliance for government grants and contracts. Blackbaud Financial Edge NXT has powerful reporting tools to help finance teams drive transparency and open modern APIs to support data integrations or enhanced workflows. It seamlessly integrates with multiple Blackbaud products including Raiser's Edge NXT, Blackbaud Tuition Management and Blackbaud Billing Management so nonprofit organizations can connect their business offices and workflows across the organization. Financial Edge NXT eliminates redundant tasks and manual processes across the organization and within the financial office itself through Payment Assistant™, native functionality for automated bill pay and Expense Management, functionality for submission of expenses. We recently introduced AI-powered document intelligence for scanning of invoices to reduce manual data entry.

Blackbaud Purchase Cards provide an efficient and convenient alternative to traditional procurement methods and paper-based payables processes such as checks, purchase orders and invoices for travel and operational purchases. Organizations can also set spend controls for individual cardholders, track business expenses across the organization and ensure that policies are being enforced—all managed online and integrated with Blackbaud Financial Edge NXT.

Blackbaud Tuition Management™ benefits schools by giving administrators better access to financial data and payment services, and by giving parents more ways to remit tuition payments. The solution is fully integrated with Blackbaud Financial Edge NXT and helps ease the burden for administrative staff by offering invoicing, payment processing, customer service, enhanced communication with parents and later payer follow-up services.

Blackbaud Financial Aid Management™ offers schools the ability to accept online, customized applications for financial aid and to make better financial aid decisions with a proprietary Hobbies, Interest and Lifestyles ("HIL") profile. The HIL profile provides in-depth information on an applicant, delivering to the school a way to make more informed decisions on how they distribute financial aid awards.

Blackbaud Billing Management™ makes it easy for school administrators to manage tuition and billing processes and for parents to manage their payments to the school. It gives families flexible payment options, provides the school visibility into payments and billing with metrics for supporting cash flow, one view of financial performance, 24/7 bill access on all devices, and removes manual processes from admissions to finance and merchant services.

Grant and Award Management

Blackbaud Grantmaking™ is a modern cloud solution that supports the end-to-end grantmaking process from application through review and resolution. Blackbaud Grantmaking provides core functionality to efficiently disperse funds, maintain compliance with due diligence requirements and measure and demonstrate impact. The system has collaborative tools to help strengthen relationships with grantees and other community partners. Blackbaud Grantmaking supports collaboration between funders and nonprofits around intended outcomes to drive desired impact. Both the funder and the nonprofit can tell an impact story using ROI-focused results and a common outcomes measurement language.

Blackbaud Award Management™ is a comprehensive, integrated scholarship management platform for higher education and K-12 institutions and foundations, allowing students to apply for all awards using one intuitive and streamlined application process and eliminating many time-consuming administrative tasks. This leads to improved awarding, reporting, compliance, communication and stewardship.

Education Solutions

Blackbaud Student Information System™ makes it easy for schools to manage schedules, transcripts and GPAs. A new Student Information System that works directly with Blackbaud Learning Management System™, Blackbaud Student Information System simplifies the process of sharing student data and academic records securely.

Blackbaud Learning Management System™ is a learning management system that makes it easy to manage, connect, and share information with students, parents, and an entire school community. Developed with direct input from our customers, Blackbaud Learning Management System gives teachers the tools to meet the demands of a modern private school.

Blackbaud Enrollment Management System™ is an enrollment management system that simplifies a school’s admissions process. Blackbaud Enrollment Management System helps admissions teams and prospective families manage and track their progress, from inquiry and application through acceptance and enrollment.

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Blackbaud School Website System™ is a content management system that gives schools the flexibility to build and edit webpages, with easy access to content types including photos, videos, downloads, text and more. It allows users to share material and contribute content across an entire school community.

Social Responsibility, Employee Giving and Volunteering

YourCause GrantsConnect® and YourCause CSRconnect® are cloud solutions for employee giving, volunteering, and grantmaking used to support corporate philanthropy by building meaningful connections between corporations, employees and nonprofits. After implementing YourCause solutions, customers typically show significant growth in volunteers, donations, engagement and more. These reported successes demonstrate a larger trend: overall ability to attract employees and customers alike by strengthening a company's reputation.

Blackbaud Impact Edge™ is an AI-powered solution designed for social impact reporting and storytelling, tailored for corporate social responsibility (CSR) and social impact teams of all sizes. This innovative technology utilizes responsible generative AI to help impact professionals create a compelling picture of their organization’s social impact. It seamlessly integrates data captured safely and securely from employee engagement programs, philanthropic initiatives, educational projects, and other trusted external sources.

Payment Services

Our solutions provide our customers payment processing capabilities that enable their donors to make donations and purchase goods and services using numerous payment options, including credit card and automated clearing house (“ACH”) checking transactions, through secure online transactions.

Blackbaud Integrated Payments™ (formerly, Blackbaud Merchant Services) is a value-added service integrated with our solutions that makes credit card processing simple and secure. Customers are charged one rate for credit card transactions, making Blackbaud Integrated Payments a competitive option. The service also provides customers with a payment card industry (“PCI”) compliant process and streamlined bank reconciliation.

Customer Success

Our Customer Success organization is responsible for ensuring our customers achieve their desired outcomes through Blackbaud solutions, starting at onboarding and continuing through the customer lifecycle. Our Customer Success team develops and fosters relationships within all levels of the customer organization to help ensure that customers get the most value out of our AI-powered solutions and services, while helping them achieve their desired outcomes. Our customer success resources work to proactively communicate to drive overall satisfaction and retention of our customers' business. They work to collect and analyze actionable information, whether that is through direct customer relationships or through aggregated analytics that drive future one-to-one or one-to-many interactions. Their goal is to partner with customers to ensure that they are fully engaged and have an advocate within Blackbaud who works to meet their needs. Customer success resources bring industry knowledge and expertise to the customer relationship and strive to help our customers achieve positive growth and outcomes.

Customer Support

Customer Support provides assistance to customers using Blackbaud solutions, helping them understand the capabilities of their subscription, including how to navigate their subscription and answering related questions for core concepts of features and functionality. Benefits, such as priority routing or additional support channels, are continuously enhanced. Customers enrolled in the programs enjoy timely, reliable customer support, receive regular software updates, stay up-to-date with regular communication and can leverage a unified customer portal for quick and easy access to these resources. Customers also are empowered with self-help resources such as AI-based support tools, Knowledgebase articles, user guides, Blackbaud Community, our on-demand library of enablement sessions and have around-the-clock access to support resources for mission-critical needs.

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Professional and Managed Services

Our expert consultants, and those in our partner program, provide implementation, optimization, data conversion and customization services for our AI-powered software solutions. These services include:

•System implementation;

•Data conversion, business process analysis and application customization;

•Database merging and enrichment;

•Database production activities;

•Website design services; and

•Outcome-based and prescriptive services.

In addition, we, and our delivery partners, apply our industry knowledge and experience, combined with expert knowledge of our solutions, to evaluate an organization's needs and consult on how to improve a business process.

Training

Blackbaud University helps organizations unlock the full potential of their solutions. Our training emphasizes newly released features and real-world application, to help customers build confidence and optimize the use of Blackbaud solutions. Our array of learning modalities makes it easy for users to take training that fits their schedule, whether quickly upskilling new hires or expanding the knowledge and efficiency of existing staff. This expertly designed product training empowers users to learn fast and work smart.

Sales and Marketing

Most of our AI-powered solutions and related services are sold through our direct sales force. As of December 31, 2025, we had approximately 170 direct sales employees. Our direct sales force is complemented by a team of sales development representatives responsible for sales lead generation and qualification. In addition, lead generation is supplemented by our customer success organization via employee-generated sales leads. Our partner program also includes optional engagements around referrals, technical integrations, and implementation services which also support and supplement our go-to-market efforts by promoting customer choice and facilitating extensible capabilities. These sales, sales support, partners and customer success professionals are primarily located throughout the United States, the U.K., Canada and Australia.

Our marketing organization, which includes brand, digital, content, product, event and demand generation marketing and corporate communications, develops and launches multi-channel campaigns designed to create brand recognition and market awareness for our AI-powered solutions and services.

Our digital demand generation motion focuses on targeted account-based marketing plays, as well as intent-based programs including paid search, retargeting, social and content syndication programs. We supplement the digital motion with our annual user conference, bbcon®, select participation at virtual and in-person third-party trade shows, technical conferences, and technology seminars. We also target publication of our thought leadership content and position our subject matter experts in industry journals and publications. We have a large base of loyal customers and strategic partners that provide references and recommendations often featured in our advertising and promotional activities.

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Competition

The market for software and related services targeting philanthropic-focused for-profit, nonprofit organizations and schools is competitive and highly fragmented. For certain areas of the market, entry barriers are low, as general tools for small businesses can usually be configured to manage the most basic marketing, contact management, and accounting needs of social impact organizations. In parallel, as software development evolves from a highly-complex tradecraft with nuanced understanding of architectural patterns and discrete languages, to click-to-code and drag-and-drop development with natively cloud-based infrastructure, it becomes easier for competitors to quickly spin up basic applications to solve common problems. However, once basic needs are met, programs unique to social impact organizations like the stewardship of relationships and partnerships critical to major gift fundraising and corporate grants; the cultivation and management of gifts and sponsorships; the intricacies of not-for-profit specific fund accounting; the multi-level networking required for peer-to-peer activism and employee engagement; and the sensitive data and reporting behind critical programs run by and for healthcare and education institutions ensure the ongoing need for highly specialized tools. These specialized applications have a higher barrier of entry as they require industry insight to accurately articulate the business workflow that generates the requirements for software products. Moreover, because social impact organizations rely heavily on relationships with and among their supporters, integration of systems drives value beyond mere efficiency. Hence, we believe our insight, the full spectrum of our current solutions and our ability to deliver future solutions make us a strong competitor. We expect to continue to see new entrants as focus on social investment solutions increases to satisfy Millennial and Gen Z donors, customers and employees, the barriers of entry continue to decline with natively cloud solutions and social impact organizations more readily require digital transformation of business processes and data-driven decision making.

Our competition falls into four primary categories:

•Niche products are usually developed as a solution for a single problem at an organization and are adopted by similar organizations to solve a specialized need. These are typically offered by vendors who may have deep industry expertise but may not have the resources to expand beyond a specialized area, or whose solutions require managed services which limit their ability to scale. We believe we compete against these solutions by offering a set of integrated, AI-driven solutions rather than a single point solution, which we believe improves the overall customer experience and reduces organizational risk. In addition, our open platform allows integration to specialized applications so the opportunity for disruption from these competitors is minimized.

•Vertical-specific solutions are offered by competitors seeking to meet the enterprise-wide needs of a specific sub-segment of the social impact community. Typically, these solutions are offered by vendors who may offer either a point solution or integrated suite of products used by a vertical. We believe we compete successfully against these competitors through a combination of our integrated suite of offerings and nationwide community networks within verticals where we compete, offering solutions with market leading robustness and reporting as well as the scale, reach, and reputation of our organization.

•General business software vendors, such as Microsoft, Oracle and Salesforce.com, compete with us in certain areas of our business. While there is a growing trend toward social investment that is prompting philanthropic solutions from these general business vendors, most do not have a complete nonprofit specific focus and, therefore, do not offer, or to our knowledge do not intend to offer, nonprofit-specific versions. However, there is a subset of general business software competitors who have introduced nonprofit-specific versions of their products. These products generally do not satisfy the needs of nonprofits from end-to-end as they were not designed to support the specific needs of nonprofits during the original architecture, design, and requirements elicitation phases; and several of the products introduced by general business software vendors have been subsequently pulled from market based on lack of adoption and customer satisfaction. We believe that the products that remain are not yet fully capable of meeting market needs without significant customization to transform general business products into nonprofit solutions often requiring the use of consultants to guide the implementation, without which, leave the adoption of general business software limited to very basic operations and simple needs. We believe our solutions compete successfully against general business software as a nonprofit’s needs grow more complex. As a result, we believe we can compete successfully to meet nonprofit-specific requirements, often integrating with general business platforms used for their more generalized operations.

•Consumer-oriented fundraising platforms, such as GoFundMe and Facebook compete with our business where consumers raise funds directly. To drive adoption of their platforms, these vendors rely on a combination of direct-to-consumer marketing, marketing to nonprofits who in turn market to their supporters, and marketing to intermediate entities such as an event sponsor who will market to participants. We believe we compete well in this

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market through a combination of positive brand recognition among all three of these groups and the combination of our consumer- and organization-oriented tools relative to those of the competition.

Less frequently, we compete with providers of traditional, non-automated fundraising service providers, including parties providing services in support of traditional direct mail or email campaigns, special events fundraising, peer-to-peer, telemarketing and personal solicitations. We believe we compete successfully against these traditional fundraising service providers, primarily because our solutions and services are more automated, more robust, more tailored to the needs of nonprofit organizations and more efficient.

We believe our proprietary data, comprehensive product suite and domain‑specific workflows provide a durable competitive moat, in the same way they have supported our success to date versus competitors. Our early incorporation of verticalized, embedded AI and agentic automation capabilities, coupled with decades of sector credibility, positions us to lead the market into the next phase of intelligent, mission‑driven software.

Technology and Architecture

Our technology strategy consists of several key building blocks including cloud operations, developer tools, data intelligence and core services. We leverage multiple clouds in our architectures (including AWS and Azure) and have both single and multi-tenant solutions. The best-in-class infrastructure enables rapid innovation with high levels of reliability, availability and security, and lets Blackbaud evolve services over time at independent paces as tech trends and tools emerge. Blackbaud also provides a toolset for customers, partners, and developers to extend the Blackbaud SKY ecosystem. SKY API enables developers to augment Blackbaud solutions with industry-standard REST APIs, standards-based authentication protocols, and a best-in-class developer experience. SKY UX allows developers to create applications with the same consistent, cohesive user interface as Blackbaud’s native solutions using an open-source framework that implements Blackbaud design patterns and provides guidelines and tooling for the entire application lifecycle. Our Intelligence for Good® strategy affirms our commitment to AI that is convenient, powerful and responsible. Our AI Platform is built on best-in-class services and agentic capabilities and enables tools — both internal and third-party — to access our data securely to provide intelligent capabilities.

The development strategy for all Blackbaud cloud solutions emphasizes:

•Flexibility: Customers and partners can extend our component-based architecture to accommodate changing demands without modifying source code.

•Adaptability: The architecture of our applications allows us to easily add functionality or integrate with third-party applications to adapt to customer needs and market demands.

•Scalability: Scalable architecture and the performance, capacity and load balancing of our customers' industry-standard web servers and databases ensure that applications can scale to meet the needs of large organizations.

Intellectual Property and Other Proprietary Rights

To protect our intellectual property, we rely on a combination of patent, trademark, copyright and trade secret laws in various jurisdictions, as well as employee and third-party nondisclosure agreements and confidentiality procedures. We maintain many trademarks, including, but not limited to “Blackbaud,” “Raiser's Edge NXT” and “Luminate.” We currently have one active patent on our technology and have one pending patent application.

Human Capital Resources

As of December 31, 2025, we employed approximately 2,800 talented professionals worldwide, none of whom are represented by unions or covered by collective bargaining agreements. We are not engaged in any material disputes with employees, and we maintain strong, positive relationships across our workforce.

Our people are energized by our mission to fuel social impact. This purpose is a powerful differentiator—approximately 91% of employees cite Blackbaud’s commitment to social responsibility as important to them. It drives engagement and enables us to deliver exceptional service to customers. Our employees live this commitment: approximately 74% volunteer annually with nonprofits, and one in seven serves on a nonprofit board or committee, bringing firsthand experience to the communities we serve.

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In 2025, we advanced our Remote-Flexible workforce strategy, a cornerstone of our culture built on trust, innovation and productivity. This dynamic model is not “remote-only,” “hybrid-only,” or “in-office-only.” Instead, it adapts to the needs of the work and the teams, while remaining in compliance with applicable local laws, empowering employees to thrive while delivering outstanding outcomes. Whether collaborating in person, connecting virtually, or blending both, we believe flexibility fuels performance, inclusion and innovation.

We are expanding our global footprint through the continued build‑out of our new Global Capability Center (“GCC”) in Hyderabad, India. This expansion enhances our access to talent and enables through labor arbitrage while maintaining a high quality of work, and it supports a follow‑the‑sun operating model. Beginning in 2024, we have relied on a combination of (i) insourcing certain roles previously performed by third parties into the GCC, (ii) evaluating roles and required skill sets, and opportunities created through our adoption of AI to determine whether positions that become vacant through attrition should be backfilled within the GCC, and (iii) and opportunistically transitioning additional roles to the GCC. We expect to continue this approach as we execute the next phase of our global workforce strategy through 2027. See “Management’s Discussion and Analysis of Financial Conditions and Results of Operations—Executive Summary” in Item 7 of this report for additional information about this initiative.

Employee engagement is a key priority. Every manager completes our multi-course Engagement Labs training to build highly engaged teams. We measure progress through quarterly check-ins, a global career framework and regular employee surveys. Company-wide Connect and Engage meetings and “Ask Anything” sessions with senior leaders foster connection, clarity and open-dialogue. Career development is supported through DevelopU, our learning platform, and global regional connection gatherings that combine leadership access with volunteer opportunities. In 2025, we launched a comprehensive AI Literacy Program, a significant investment in our people and our business. Participation in the program is required for employees as part of our broader commitment to responsible AI adoption. This initiative equips employees with the knowledge and skills to leverage AI responsibly and effectively, ensuring Blackbaud remains at the forefront of innovation. The program will continue to evolve in 2026, reinforcing our commitment to future-ready talent.

Our total rewards framework ensures equitable, competitive pay through base salary, variable incentives, equity awards and comprehensive benefits. We support the whole person with enhanced well-being programs, including our award-winning quarterly well-being sessions focused on mental health, resilience and financial health. These sessions, combined with a digital-first mindset, empower employees to make proactive decisions for their health and overall well-being.

We believe inclusion starts at the candidate experience. Today, several employee-led affinity groups represent communities including veterans, LGBTQ+, women in technology and sales, people of color, sustainability advocates, and individuals with disabilities. Participation in these groups grew by 5% in 2025, engaging 45% of our global workforce. Sustainability remains central to our operations. We have achieved carbon neutrality annually since 2021, and continue to drive operational efficiency and look for areas to reduce emissions while providing transparent reporting. In 2025, Blackbaud was recognized by Newsweek as one of the World’s Greenest Companies.

Our culture and purpose earn global recognition:

•Newsweek: America’s Most Responsible Companies 2025

•TIME: America’s Best Mid-Size Companies 2025

•Fast Company: Best Workplaces for Innovators

•2025 Disability Employer by Disability Solutions

Through philanthropy programs—including matching gifts, volunteer grants, skills-based initiatives and STEM-focused outreach—we empower employees to amplify social impact worldwide.

Blackbaud is an exceptional place to work because we combine purpose, flexibility and innovation to attract, develop and retain top talent. We govern ethically, champion sustainability and foster inclusion—powering our people and our mission to make a difference in the world.

Seasonality

For a discussion of seasonal variations in our business, see “Management’s Discussion and Analysis of Financial Conditions and Results of Operations—Seasonality” in Item 7 of this report.

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Working Capital

For a discussion of our working capital practices, see “Management’s Discussion and Analysis of Financial Conditions and Results of Operations—Liquidity and Capital Resources” in Item 7 of this report.

Available Information

Our website address is www.blackbaud.com. We make available, free of charge through our website, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC, but other information on our website is not incorporated into this report. The SEC maintains an Internet site that contains these reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at www.sec.gov.

Information About Our Executive Officers

The following table sets forth information concerning our executive officers as of February 15, 2026:

Michael P. Gianoni joined us as Chief Executive Officer and President in January 2014 and was appointed Vice Chairman of the Board in January 2024. Prior to joining us, he served as Executive Vice President and Group President, Financial Institutions at Fiserv, Inc., a global technology provider serving the financial services industry, from January 2010 to December 2013. He joined Fiserv as President of its Investment Services division in December 2007. Mr. Gianoni was Executive Vice President and General Manager of CheckFree Investment Services, which provided investment management solutions to financial services organizations, from June 2006 until December 2007 when CheckFree was acquired by Fiserv. From May 1994 to November 2005, he served as Senior Vice President of DST Systems Inc., a global provider of technology-based service solutions. Mr. Gianoni is a member of the Board of Directors of Teradata Corporation, a publicly traded global big data analytics company, and has been Chairman of the Board since February 2020. Mr. Gianoni has served on several nonprofit boards across several segments, including relief organizations, hospitals and higher education and he currently is a member of the President's Advisory Group at the Medical University of South Carolina. He holds an AS in electrical engineering from Waterbury State Technical College, a BS with a business concentration from Charter Oak State College, and an MBA and an honorary Doctorate from the University of New Haven.

Chad M. Anderson joined Blackbaud in March 2013 and was promoted to Executive Vice President and Chief Financial Officer in April 2025. Prior to his appointment as Executive Vice President and Chief Financial Officer, Mr. Anderson served as the Company’s Senior Vice President and Chief Accounting Officer since June 2022 and Vice President and Corporate Controller from March 2013 to May 2022. Prior to joining the Company, Mr. Anderson was Chief Financial Officer of the Europe, Middle East, and Africa region at Brightpoint Inc., a global provider of mobile device lifecycle services to the wireless industry, from March 2009 until February 2013 and Vice President of Finance for International Operations at Brightpoint from February 2008 until March 2009. He holds a BS in Finance from Indiana University.

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David J. Benjamin has served as our Executive Vice President and Chief Commercial Officer since July 2022. He joined us as Executive Vice President and President, International Markets Group in April 2018. Prior to joining us, Mr. Benjamin was Senior Vice President and General Manager at Box, a cloud content management platform for businesses, from October 2016 to March 2018. Prior to that, he was Vice President of Global Services at British Telecom, a multinational telecommunications holding company, from October 2007 to September 2016. Prior to that, he was at Guardian Media Group, a mass media company owning various media operations company, where he served as Divisional Chief Operating Officer, among other leadership roles, from June 1995 to September 2007. He holds a BA in European Business from London Metropolitan University and an MBA from The Manchester Metropolitan University.

Kevin P. Gregoire has served as our Executive Vice President and Chief Operating Officer since July 2022. Prior to that, he was the Executive Vice President and President of U.S. Markets since April 2021. He joined us as Executive Vice President and President, Enterprise Markets Group in April 2018. Prior to joining us, Mr. Gregoire was Group President of the Financial Institutions Group at Fiserv, a global technology provider serving the financial services industry, from March 2014 until February 2018. He joined Fiserv in December 2002 and served in other key leadership roles including Division President and Chief Operating Officer, Card Services, and Senior Vice President of Product and Network Strategy. Mr. Gregoire is also a veteran of the United States Army, where he served as Lieutenant in the Corps of Engineers and was awarded three Army Commendation Medals. He holds a BS from the United States Military Academy at West Point, and an MBA from the F.W. Olin School of Business at Babson College.

Kevin R. McDearis has served as our Executive Vice President and Chief Technology Officer since October 2016 and is responsible for the company’s global product and technology portfolio, including cybersecurity. He joined us in August 2014 as our Senior Vice President of Global Product Development. Prior to joining us, Mr. McDearis was the Chief Information Officer at Manhattan Associates, Inc., a technology leader in supply chain and omnichannel commerce, from August 2012 to July 2014. He was responsible for leading a global IT organization in strategy development, organization development, portfolio and project management, software and infrastructure engineering, service delivery and operations. Prior to that, Mr. McDearis served as Chief Technology Officer for the Enterprise Technology Group and other key leadership positions at Fiserv (formerly CheckFree), a global technology provider serving the financial services industry, from October 1996 to August 2012. Mr. McDearis serves on the Board of Directors for the USS Yorktown Foundation. He also served on the Board of Directors of the Technology Association of Georgia from 2011 to 2016 and as Vice Chairman of the Board in 2014. He holds a BS in Management from The Georgia Institute of Technology.

Jon W. Olson has served as our Chief Legal Officer since April 2025 and is responsible for Blackbaud's legal activities. He joined us as Senior Vice President and General Counsel in September 2008. Prior to joining us, he was an attorney with Alcatel-Lucent USA, the U.S. subsidiary of Alcatel-Lucent (now owned by Nokia Corporation) that designs, develops, and builds wireline, wireless, and converged communications networks, from July 1997 to September 2008. Prior to joining Alcatel-Lucent, Mr. Olson was employed in legal positions with MCI, Inc., a global business and residential communications company, from September 1996 to July 1997, and Unisys Corporation, a global information technology company, from July 1992 to September 1996. Mr. Olson is a member of the MUSC (Medical University of South Carolina) Hollings Cancer Center Advisory Board. He holds a BS from Georgetown University, a JD from Dickinson School of Law and an MBA from Seton Hall University.