5 unchanged sentences
Serving the nonprofit and education sectors, companies committed to social responsibility and individual change makers, our essential software is built to accelerate impact in fundraising, nonprofit financial management, digital giving, grantmaking, corporate social responsibility and education management.
−Removed: A remote-first company, we have operations in the United States, Australia, Canada, Costa Rica and the United Kingdom, supporting users in 100+ countries.
−Removed: Millions of people across more than 100 countries connect, give, learn and engage through Blackbaud platforms.
−Removed: During 2023, we had nearly 100,000 customers that paid Blackbaud through transactional fees and more than 40,000 customers with contractual billing arrangements.
+Added: A remote-first company, we have operations in the United States, Australia, Canada, Costa Rica, India and the United Kingdom, supporting users in 100+ countries.
Our revenue is primarily generated from the following sources:
(i) charging for the use of our software solutions in cloud and hosted environments;
−Removed: (ii) providing payment and transaction services;
−Removed: and (iii) providing Impact-as-a-Service ™ digital educational content.
+Added: and (ii) providing payment and transaction services.
Update on Five Key Operational Initiatives
+Added: In early 2023, we outlined five key operational initiatives targeted to drive innovation, bookings growth, revenue expansion and lower costs.
+Added: During 2024, we continued to execute on these key initiatives.
1 Product Innovation and Delivery
4 unchanged sentences
Product Innovation and Delivery
−Removed: Product is core at Blackbaud, and we strive to bring increased value to our customers with improved and innovative capabilities.
−Removed: We have recently announced or released a number of product enhancements as well as new solutions that enable our customers to better deliver on their missions.
+Added: To maintain our market leadership position, we are accelerating the pace of innovation and new feature delivery to our customers.
+Added: Our focus has been on two areas, artificial intelligence (AI) and enhancements that continue to improve the connectivity of our suite of solutions.
+Added: These enhancements are aimed at improving fundraising outcomes while reducing the administrative burden of our end users.
Some examples include:
−Removed: • Optimized Online Donation Capabilities:
−Removed: New online donation capabilities that fully integrate with Blackbaud’s payment processing and CRM software and enable customers to raise more money while reducing processing costs.
−Removed: We recently began an early adopter program for the new donation capabilities with a small sample of RE NXT customers across charity, education, and arts and cultural organizations.
−Removed: We expect to make them generally available in the first half of 2024.
−Removed: • Prospect Insights Pro for Raiser’s Edge NXT®:
−Removed: New add-on capability within Raiser’s Edge NXT® that gives fundraisers access to AI-driven insights to support planned and major gift fundraising
−Removed: • Impact Edge TM :
−Removed: A first-of-its-kind AI-powered, social impact reporting and storytelling solution for corporate social responsibility (CSR) and social impact teams of all sizes.
−Removed: This new solution is currently in an early adopter program with our planned full roll out in the second half of 2024.
+Added: • We have released a number of AI capabilities in our solutions, including generative AI functionality for our JustGiving platform.
+Added: During 2024, we released generative AI capabilities for Raiser’s Edge NXT®, and we expect that Blackbaud Copilot will be available to our Raiser's Edge NXT customers soon.
+Added: Using Blackbaud Copilot, users can ask ad hoc questions such as “How can I improve my average donation size?” and the tool will provide intelligent responses as well as recommended actions intended to drive that outcome.
+Added: • During 2024, our Online Giving and Prospect Insights capabilities were natively integrated into Raiser's Edge NXT.
+Added: With these integrations, fundraising administrators can now drive a giving campaign, keep records of each donor interaction, identify new donation opportunities, and provide personalized messaging, all in one integrated experience.
+Added: • During 2024, we released our new optimized donation forms for Raiser's Edge NXT, Blackbaud CRM and Blackbaud Altru that fully integrate with our payment processing and CRM software.
+Added: We expect these forms to drive higher revenue for our customers and for Blackbaud.
2024 Form 10-K
Blackbaud, Inc.
−Removed: • JustGiving Storywriter:
−Removed: With new generative AI capabilities, fundraisers on JustGiving are able to quickly and easily create personal stories to share with their networks.
−Removed: Company research has shown that JustGiving pages that include a clear and personal story raise approximately 65% more than those that don’t.
−Removed: • Good Move TM :
−Removed: New development transformed the Good Move activity-tracking mobile app into a powerful mobile participant center for Blackbaud TeamRaiser® peer-to-peer fundraising events.
−Removed: The new expansive feature for Blackbaud TeamRaiser® became generally available in the U.S.
−Removed: and Canada in March 2023.
−Removed: • Intelligence for Good®:
−Removed: In summer 2023, we launched next generation Intelligence for Good® strategy with an extensive agenda of initiatives and investments targeted at making artificial intelligence more accessible, powerful and responsible across the social impact sector
+Added: We are delivering more innovation, evolving our products and ensuring our customers receive more value from our solutions.
Bookings Growth and Acceleration
10 unchanged sentences
The diversity of the underlying transaction volumes from these four sources has resulted in consistent transactional recurring revenue growth in the mid-to-high single digits over the past several years.
−Removed: Strong momentum in consumer giving and tuition management, rate increases on Blackbaud Merchant Services, and increased donations tied to global events drove continued solid transactional recurring revenue growth in 2023.
−Removed: Going forward we will continue to implement additional payments solutions optimization to drive enhanced donor experience.
+Added: We continue to see strong momentum in consumer giving and tuition management, we have implemented rate increases across select areas of our payments portfolio, and we continue to implement additional payments solutions optimization to drive enhanced donor experience.
Modernized Approach to Pricing and Multi-Year Contracts
−Removed: Last summer, we put in place an updated pricing policy primarily for our social sector customers that directly reflects the value we provide to them, is in-line with the broader market and reflects the inflationary pressures that all businesses are facing.
−Removed: In November 2022, we started notifying customers with a March 2023 contract renewal that we would be making important contract changes.
−Removed: First, we are offering 3-year contract renewal terms as our standard, replacing one-year renewal terms.
−Removed: This process was already being implemented outside of the pricing changes.
−Removed: Second, we are implementing a more significant rate increase on the 1-year renewal option versus the 3-year renewal option.
−Removed: And third, the 3-year renewal option includes embedded annual rate increases.
−Removed: Our 3-year renewal options did not historically include annual rate increases.
−Removed: These efforts are well on their way and we have now completed the 2023 renewal cohort, which represented approximately 35% of the total contractual revenue eligible for this program.
−Removed: Approximately another 30% of the renewable base is up for renewal in 2024, another 25% in 2025, and the remaining 10% in the beginning of 2026.
−Removed: The close day-to-day management of renewals, the mix of 3-year and 1-year contracts, and the impact of pricing are progressing well, and we expect more impact from the compounding effect of these rate increases over time as we layer in future year contract renewals and annual rate increases.
+Added: In the summer of 2022, we put in place an updated pricing policy primarily for our social sector customers that directly reflects the value we provide to them, is in-line with the broader market and reflects the inflationary pressures that all businesses are facing.
+Added: This program is designed to deliver sustained revenue growth beyond the initial three-year renewal cycle and will provide us with improved revenue visibility.
+Added: As previously disclosed, this new approach has three main components:
+Added: offering 3-year contract renewal terms as our standard, which the vast majority of customers are adopting;
+Added: embedded annual price increases within the 3-year renewal term, which we have not had previously and are beginning to take effect;
+Added: and a larger first year price increase to bring our pricing in-line with the broader market.
+Added: The first two components, as well as a portion of the third, will continue on beyond the initial renewal cycle, creating what we believe will be a sustainable source of revenue growth.
+Added: We have now completed the 2023 and 2024 renewal cohorts, which represented approximately 65% of the total contractual revenue eligible for this program.
+Added: Approximately another 25% of the renewable base is up for renewal in 2025, and the remaining 10% in the beginning of 2026.
+Added: The close day-to-day management of renewals, the mix of 3-year and 1-year contracts, and the impact of pricing are progressing well.
Additionally, the adoption of 3-year renewals as a standard, with more customers opting for this option than we originally expected, are expected to have an added benefit of higher retention which provides greater revenue assurance and predictability.
−Removed: Looking even further ahead, the cycle starts fresh in 2026 as the 2023 signed contracts will begin to renew.
−Removed: We expect that this will be a sustainable and meaningful revenue growth stream for us.
Keen Attention to Cost Management
2 unchanged sentences
• A reduction in headcount from approximately 3,600 in the third quarter of 2022 to approximately 3,000 as of December 31, 2023
−Removed: 2023 Form 10-K
−Removed: Blackbaud, Inc.
• Continued IT consolidation as we migrate customers from legacy private data centers to leading public cloud service providers.
2 unchanged sentences
• Reduced our real estate footprint as part of the shift to a remote-first workforce
−Removed: Going forward, our goal is to run the business at about this headcount level for the foreseeable future, while continuing to drive efficiencies in other areas of the business.
+Added: During 2024, we continued to run the business at about the same headcount level, while continuing to drive efficiencies in other areas of the business.
+Added: After the divestiture of EVERFI on December 31, 2024, we had approximately 2,600 employees.
+Added: 2024 Form 10-K
+Added: Blackbaud, Inc.
+Added: As a remote-first workforce company, we can be strategic about selecting the appropriate geographic region for various functions in order to reduce costs without negatively impacting the quality of our products and services.
+Added: For example, we are currently expanding our operations in India, which we expect will give us greater access to talent, and increase the number of our employees, including management, in India.
+Added: We have rented office space in India to accommodate those new operations, although we do not currently expect to generate revenue in India in the foreseeable future.
+Added: There are two remaining legacy data centers that we are currently working towards closing in the future.
Financial Summary
−Removed: Total Revenue ($M) Income from Operations ($M)
+Added: Total Revenue ($M) Income (loss) from Operations ($M)
YoY Growth (%) YoY Growth (%)
Total revenue increased by $50.1 million during 2024, driven largely by the following:
−Removed: + Growth in recurring revenue primarily related to:
−Removed: l an increase in transactional recurring revenue of $30.5 million primarily due to positive results related to pricing initiatives we implemented during 2023 and increases in volume for our Blackbaud Tuition Management, JustGiving and Blackbaud Merchant Services solutions;
−Removed: l an increase in contractual revenue of $29.3 million related to the performance of our cloud solutions and, to a lesser extent, the early impact of our pricing initiatives;
−Removed: partially offset by a decrease in maintenance revenue as customers migrate to our cloud solutions.
+Added: + Growth in recurring revenue primarily driven by:
+Added: l an increase in contractual revenue of $36.7 million largely due to the impact of our 3-year contract renewal initiative and pricing within the Social Sector as well as the performance of our cloud solutions, partially offset by decrease in revenue from EVERFI and maintenance revenue;
+Added: l an increase in transactional recurring revenue of $20.9 million primarily due to positive results related to pricing initiatives we have implemented in the past twelve months and increases in volume for our Blackbaud Tuition Management and JustGiving solutions;
+Added: also contributing to the increase in transactional recurring revenue during the year ended December 31, 2024 was an increase related to fluctuations in foreign currency exchange rates of $2.2 million.
- Decrease in one-time services and other revenue primarily related to:
−Removed: l decrease in one-time consulting revenue due primarily to less sales of creative services and implementation and customization services.
−Removed: Also contributing is an increase in utilization of third-party service delivery partners.
−Removed: For several years, we have been strategically shifting away from a one-time services business model towards sales of retained and managed services and also embedding services in our renewable cloud solution contracts.
−Removed: Retained and managed services contracts that we expect to have a term consistent with our cloud solution contracts, and embedded services are recorded as recurring revenue;
−Removed: l decrease in one-time analytics revenue as analytics now are generally integrated in our cloud solutions.
+Added: l decrease in one-time consulting revenue of $7.5 million primarily due to a decrease of $7.4 million resulting from our sale of EVERFI Limited as discussed in Note 3 to our consolidated financial statements in this report
For information on the impact of foreign currency fluctuations on our financial results, see Foreign Currency Exchange Rates below on page 59 .
We have a number of multi-year pricing initiatives underway, some to bring our pricing in line with the market while others are model changes that are expected to drive greater revenue for both us and our customers.
−Removed: As a result, we expect to see a continued acceleration in revenue growth during 2024 as we begin to see the full-year effect of some of these pricing initiatives.
−Removed: We expect that the decline in our non-strategic one-time services and other revenue will slow in 2024 compared to the previous two years.
+Added: Our Social Sector revenue (which represents approximately 88% of our total full year revenue) increased $67.4 million, or 7.1%, during 2024, when compared to the same period in 2023, driven primarily by the increases in contractual recurring revenue and transactional recurring revenue discussed above.
+Added: The Social Sector has proven to be very resilient as demonstrated through the last several economic downturns and the COVID-19 pandemic, and we have great confidence in the long-term trajectory of this portion of our business.
+Added: Our Corporate Sector revenue (which represents approximately 12% of our total full year revenue) decreased $17.3 million, or 11.5%, during 2024, when compared to the same period in 2023, driven primarily by the underperformance of EVERFI and our disposition of EVERFI Limited in March 2024 (see Note 3 to our consolidated financial statements in this report for more information).
2024 Form 10-K
Blackbaud, Inc.
−Removed: Income from operations increased by $73.2 million during 2023, driven largely by the following:
+Added: As previously disclosed, our EVERFI business faced a number of external challenges and even with the decisive actions we took during 2024, including changes to our Corporate Sector leadership and the disposition of a non-recurring revenue component (EVERFI Limited discussed above), EVERFI continued to be a drag on our overall performance, and we expected that to continue.
+Added: As a result, we took further actions to right-size EVERFI's business to better align costs to its lower revenues, and we hired a strategic advisor to assist us in considering a range of alternatives for EVERFI, one of which included a potential divestiture of the business.
+Added: This work resulted in the sale of EVERFI in December 2024 in exchange for nominal cash consideration (see page 40 below and Note 3 to our consolidated financial statements in this report for more information).
+Added: Income from operations decreased by $315.2 million during 2024, driven largely by the following:
+Added: - Pre-tax loss on disposition EVERFI of $405.4 million, including noncash impairment charges of $390.2 million.
+Added: See "EVERFI disposition charges" below on page 41 .
+ Increase in total revenue, as described above
−Removed: + Net decreases in the following costs primarily due to our targeted workforce reductions discussed below:
−Removed: • Decrease in compensation costs other than stock-based compensation of $35.4 million;
−Removed: • Decrease in commission expense of $1.1 million
−Removed: + Decrease in third-party contractor costs of $12.2 million primarily due to our focus on cost management
−Removed: + Decrease in hosting and data center costs of $5.0 million as we continue to migrate our cloud infrastructure to leading public cloud service providers and make investments in security;
+Added: - Increase in third-party contractor costs of $7.6 million largely related to enhancements to our cybersecurity program
+Added: - Increase in compensation costs other than stock-based compensation of $7.6 million primarily due to an increase in resources dedicated to our cybersecurity program
+Added: - Increase in hosting and data center costs of $5.0 million as we continue to migrate our cloud infrastructure to leading public cloud service providers and make investments in security;
currently, we expect our cloud infrastructure migration efforts and increased level of cybersecurity investments to continue for the foreseeable future
−Removed: + Decrease in Security Incident-related expenses, net of insurance, of $2.3 million.
−Removed: See "Security Incident update" below on page 39 .
−Removed: + Decrease in cost of revenue from a $2.3 million impairment charge during the three months ended June 30, 2022, against previously capitalized software development costs that reduced the carrying value of those assets to zero.
−Removed: The impairment charge resulted primarily from our decision to end customer support for certain solutions
−Removed: - Increase in stock-based compensation expense of $17.5 million attributable to primarily due to overall Company performance against 2023 goals and 2022 performance-based equity award adjustments, partially offset by the targeted workforce reductions during the fourth quarter of 2022 and first quarter of 2023
−Removed: - Increase in transaction-based costs of $9.2 million related to the increase in the volume of transactions for which we process payments and, to a lesser extent, increases in vendor rates
- Increase in amortization of intangible assets from business combinations of $4.9 million due to our acquisition of EVERFI
−Removed: - Net decrease of $4.0 million due to an increase in amortization of capitalized software and content development costs, partially offset by an increase in software and content development costs that were required to be capitalized under the internal-use software guidance
−Removed: We are continuing to make investments in the business in areas such as innovation, artificial intelligence, cybersecurity, and our continued shift of cloud infrastructure to leading public cloud service providers.
+Added: - Increase in marketing costs of $4.6 million primarily due to increased digital marketing spend related to JustGiving and, to a lesser extent, increased marketing related to EVERFI while we explored strategic options for the business
+Added: - Increase in transaction-based costs of $4.2 million related to the increase in the volume of transactions for which we process payments and, to a lesser extent, increases in vendor rates
+Added: - Increase in amortization of capitalized software and content development costs of $2.5 million due to our continued investments in the innovation and security of our solutions
+Added: - Increase in corporate costs of $2.5 million primarily related to an increase in bad debt expense.
+Added: The increase in bad debt expense was driven by an increase in write-offs.
+Added: + Decrease in Security Incident-related expenses of $39.7 million largely related to decreases in loss contingency accruals.
+Added: See "Security Incident update" below on page 40 .
+Added: + Decrease in stock-based compensation expense of $22.8 million primarily due overall Company performance against 2024 goals and a decrease in the grant date fair value of equity award grants
+Added: + Decrease in commission expense of $11.7 million primarily due to a prospective increase in the period of benefit over which we amortized costs of obtaining contracts with customers from 5 to 6 years beginning in the year ending December 31, 2024.
+Added: Also contributing to the decrease in commissions expense was a decrease in commissionable bookings primarily due to EVERFI and fewer sales headcount.
+Added: + Decrease in employee severance of $5.1 million related to our prior period targeted workforce reductions
+Added: + Decrease in acquisition and disposition-related costs of $1.4 million primarily related to less noncash impairment charges against certain operating lease right-of-use assets and property and equipment assets resulting from the subleases of our Washington, DC office location, partially offset by costs associated with the disposition of EVERFI Limited;
+Added: see Note 6 and Note 3 to our consolidated financial statements in this report for more information.
+Added: We are continuing to make investments in the business in areas such as innovation, AI, cybersecurity and our continued shift of cloud infrastructure to leading public cloud service providers.
Our profitability during 2024 reflects some of these incremental investments.
−Removed: We plan to accelerate some of the cybersecurity investments during 2024, which is expected to modestly impact our profitability in the near term.
We continuously seek opportunities to optimize our portfolio of solutions to focus time and resources on innovation that will have the greatest impact for our customers and the markets we serve, and drive the highest return on investment.
8 unchanged sentences
During 2024, our gross dollar retention was approximately 90%.
−Removed: This gross dollar retention rate was slightly lower than our rate for the full year ended December 31, 2022 primarily due to the inclusion of EVERFI beginning in 2023.
−Removed: Excluding EVERFI, our gross dollar retention during 2023 was slightly higher than our rate for the full year ended December 31, 2022.
+Added: This gross dollar retention rate was consistent with our rate for the full year ended December 31, 2023.
+Added: Excluding EVERFI, our gross dollar retention during the twelve months ended December 31, 2024 was approximately 92%.
We are continually investing in innovation, which we believe will increase gross dollar retention over the long-term.
−Removed: Although some customer attrition is normal, our new contract pricing and renewal model (as described above on page 36 ) does not appear to have had a significant impact on customer attrition to date.
Balance sheet and cash flow
At December 31, 2024, our cash and cash equivalents were $67.6 million.
−Removed: Under the 2020 Credit Facility, the carrying amount of our debt was $720.6 million and our net leverage ratio was 1.97 to 1.00.
−Removed: During 2023, we generated $199.6 million in cash flow from operations, had a net decrease in borrowings of $81.4 million and had aggregate cash outlays of $64.1 million for purchases of property and equipment and capitalized software and content development costs.
−Removed: We resumed stock repurchases during the fourth quarter of 2023 under our then existing stock repurchase program that authorized us to purchase up to $250.0 million of our outstanding shares of common stock.
−Removed: On January 17, 2024, our Board of Directors reauthorized, expanded and replenished our stock repurchase program by raising the total capacity under the program from $250.0 million to $500.0 million available for repurchases.
−Removed: We plan to repurchase shares going forward to at least offset the dilution from our annual stock-based compensation and possibly beyond that amount as market conditions and our strategic plans permit.
−Removed: See additional details regarding our stock repurchase program below on page 56 .
+Added: Under the 2024 Credit Facilities, the carrying amount of our debt was $1.0 billion and our net leverage ratio was 2.57 to 1.00.
+Added: During 2024, we generated $296.0 million in cash flow from operations, had a net increase in borrowings of $296.7 million, returned $418.0 million to stockholders by way of share repurchases and had aggregate cash outlays of $67.2 million for purchases of property and equipment and capitalized software and content development costs.
+Added: Release from Washington, DC lease
+Added: In February 2025, we made a one-time cash release payment of $28 million to the lessor in connection with a release from our lease for office space in Washington, DC (which was acquired as part of our acquisition of EVERFI in December 2021).
+Added: Due to our remote-first workforce strategy, we had not used the office space since February 2023 and had subleased a portion of the space.
Security Incident update
1 unchanged sentence
Accordingly, the Security Incident has negatively impacted, and we expect it to continue for the foreseeable future to negatively impact, our GAAP profitability and GAAP cash flow (see discussion regarding non-GAAP free cash flow and non-GAAP adjusted free cash flow on page 53 ).
−Removed: For full year 2023, we incurred net pre-tax expenses of $53.4 million related to the Security Incident, which included $22.4 million for ongoing legal fees.
+Added: For the year ended December 31, 2024, we incurred net pre-tax expenses of $13.7 million related to the Security Incident, which included $7.0 million for ongoing legal fees.
It also includes settlements and recorded liabilities for loss contingencies of $6.8 million.
−Removed: Also, for full year 2023, we had net cash outlays of $78.0 million related to the Security Incident, which included ongoing legal fees, the $3.0 million civil penalty paid during the first quarter of 2023 related to the SEC settlement and the $49.5 million civil penalty paid during the fourth quarter of 2023 related to the multi-state Attorneys General settlement (as discussed in Note 11).
+Added: Also, for the year ended December 31, 2024, we had net cash outlays of $15.9 million related to the Security Incident, which included ongoing legal fees and the $6.8 million paid during the third quarter of 2024 related to our settlement with the Attorney General of the State of California (as discussed in Note 11).
In line with our policy, legal fees are expensed as incurred.
−Removed: For full year 2024, we currently expect net pre-tax expense of approximately $5.0 million to $10.0 million and net cash outlays of approximately $8.0 million to $13.0 million for ongoing legal fees related to the Security Incident.
−Removed: 2023 Form 10-K
−Removed: Blackbaud, Inc.
+Added: For the year ended December 31, 2025, we currently expect net pre-tax expense of approximately $2.0 million to $3.0 million and net cash outlays of approximately $3.0 million to $4.0 million for ongoing legal fees related to the Security Incident.
As of December 31, 2024, we have recorded approximately $0.7 million in aggregate liabilities for loss contingencies based primarily on recent negotiations with certain customers related to the Security Incident that we believe we can reasonably estimate in accordance with our loss contingency procedures described in Note 11.
It is reasonably possible that our estimated or actual losses may change in the near term for those matters and be materially in excess of the amounts accrued, but we are unable at this time to reasonably estimate the possible additional loss.
−Removed: There are other Security Incident-related matters, including customer claims, customer constituent class actions and governmental investigations, for which we have not recorded a liability for a loss contingency as of December 31, 2023 because we are unable at this time to reasonably estimate the possible loss or range of loss.
−Removed: Each of these matters could, separately or in the aggregate, result in an adverse judgement, settlement, fine, penalty or other resolution, the amount, scope and timing of which we are currently unable to predict, but could have a material adverse impact on our results of operations, cash flows or financial condition.
+Added: 2024 Form 10-K
+Added: Blackbaud, Inc.
+Added: There are other Security Incident-related matters for which we have not recorded a liability for a loss contingency as of December 31, 2024 because we are unable at this time to reasonably estimate the possible loss or range of loss.
+Added: Each of these matters could, separately or in the aggregate, result in an adverse judgment, settlement, fine, penalty or other resolution, the amount, scope and timing of which we are currently unable to predict, but could have a material adverse impact on our results of operations, cash flows or financial condition.
+Added: EVERFI disposition
+Added: On December 9, 2024, the Company concluded that a material impairment charge of up to $415 million was required related to its EVERFI asset group, which primarily included finite-lived intangible assets and capitalized software and content development costs.
+Added: The total pre-tax noncash charges were subsequently determined to be $390.2 million.
+Added: On December 31, 2024, we disposed of EVERFI for a nominal amount that resulted in a loss on disposition of $15.2 million, which together with the impairment charges, is recorded within EVERFI disposition on our consolidated statements of comprehensive loss for the year ended December 31, 2024.
+Added: See Note 4 to our consolidated financial statements in this report for additional details.
Results of Operations
1 unchanged sentence
We report our operating results and financial information in one operating and reportable segment.
−Removed: See Note 16 of our consolidated financial statements in this report for additional information.
+Added: See Note 16 to our consolidated financial statements in this report for additional information.
Comparison of 2024 vs.
For information regarding the comparison of 2023 to 2022, please refer to Part II Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 21, 2024.
−Removed: During 2022 and 2021, we acquired companies that provided us with strategic opportunities to expand our TAM and share of the philanthropic giving market through the integration of complementary solutions and services to serve the changing needs of our customers.
−Removed: The following are the companies we acquired and their respective acquisition dates:
−Removed: • Kilter, Inc.
−Removed: ("Kilter") on August 19, 2022
−Removed: • EVERFI, Inc.
−Removed: on December 31, 2021
−Removed: We have included the results of operations of acquired companies in our consolidated results of operations from the date of their respective acquisitions.
−Removed: In accordance with applicable accounting rules, we determined that the Kilter and EVERFI acquisitions were not material to our consolidated financial statements;
+Added: On August 19, 2022, we acquired Kilter, Inc.
+Added: ("Kilter") in order to provide us with strategic opportunities to expand our total addressable market and share of the philanthropic giving market through the integration of complementary solutions and services to serve the changing needs of our customers.
+Added: We have included the results of operations of the acquired company in our consolidated results of operations from the date of acquisition.
+Added: In accordance with applicable accounting rules, we determined that the Kilter acquisition was not material to our consolidated financial statements;
therefore, revenue and earnings since the acquisition date and pro forma information are not required or presented.
−Removed: See Note 3 to our consolidated financial statements in this report for a summary of these acquisitions.
+Added: See Note 3 to our consolidated financial statements in this report for a summary of this acquisition.
2024 Form 10-K
6 unchanged sentences
contractual recurring and transactional recurring.
−Removed: Contractual recurring revenue is primarily comprised of fees for the use of our subscription-based software solutions, which includes providing access to cloud solutions, Impact-as-a-Service™ digital educational content, online training programs and subscription-based analytic services.
+Added: Contractual recurring revenue is primarily comprised of fees for the use of our subscription-based software solutions, which includes providing access to cloud solutions, online training programs and subscription-based analytic services.
Contractual recurring revenue also includes fees from maintenance services for our on-premises solutions.
4 unchanged sentences
Recurring revenue increased by $57.6 million, or 5.4%, driven primarily by the following:
−Removed: + Increase in transactional recurring revenue of $30.5 million primarily due to positive results related to pricing initiatives we implemented during 2023 and increases in volume for our Blackbaud Tuition Management, JustGiving and Blackbaud Merchant Services solutions;
−Removed: + Increase in contractual recurring revenue of $29.3 million related to the performance of our cloud solutions and, to a lesser extent, the early impact of our pricing initiatives;
−Removed: partially offset by a decrease in maintenance revenue as customers migrate to our cloud solutions.
+Added: + Increase in contractual recurring revenue of $36.7 million largely due to the impact of our 3-year contract renewal initiative and pricing within the Social Sector as well as the performance of our cloud solutions;
+Added: partially offset by decreases in revenue from EVERFI (as discussed above) and maintenance revenue;
+Added: + Increase in transactional recurring revenue of $20.9 million primarily due to positive results related to pricing initiatives we have implemented in the past twelve months and increases in volume for our Blackbaud Tuition Management and JustGiving solutions;
+Added: also contributing to the increase in transactional recurring revenue during the year ended December 31, 2024 was an increase related to fluctuations in foreign currency exchange rates of $2.2 million.
2024 Form 10-K
2 unchanged sentences
Cost of recurring revenue increased by $24.1 million, or 5.1%, driven primarily by the following:
−Removed: + Increase in transaction-based costs of $9.2 million related to the increase in the volume of transactions for which we process payments and, to a lesser extent, increases in vendor rates
−Removed: + Increase in amortization of software development costs of $5.6 million due to our continued investments in the innovation and security of our solutions
−Removed: + Increase in amortization of intangible assets from business combinations of $4.0 million primarily due to our acquisition of EVERFI in December 2021
−Removed: + Increase in stock-based compensation costs of $2.8 million primarily due to overall Company performance against 2023 goals and 2022 performance-based equity award adjustments, partially offset by the targeted workforce reductions during the fourth quarter of 2022 and first quarter of 2023
−Removed: - Decrease in compensation costs other than stock-based compensation of $8.7 million primarily due to our targeted workforce reductions discussed above
−Removed: - Decrease in hosting and data center costs of $5.1 million as we continue to migrate our cloud infrastructure to leading public cloud service providers and make investments in security;
+Added: + Increase in hosting and data center costs of $5.1 million as we continue to migrate our cloud infrastructure to leading public cloud service providers and make investments in security;
currently, we expect our cloud infrastructure migration efforts and increased level of cybersecurity investments to continue for the foreseeable future
−Removed: - Decrease in third-party contractor costs of $1.1 million primarily due to our focus on cost management
+Added: + Increase in amortization of intangible assets from business combinations of $4.6 million as most of the intangible assets we acquired with EVERFI in December 2021 were amortized on a curve that represented the expected period of economic benefit
+Added: + Increase in transaction-based costs of $4.0 million related to the increase in the volume of transactions for which we process payments and, to a lesser extent, increases in vendor rates
+Added: + Increase in third-party contractor costs of $3.8 million largely related to enhancements to our cybersecurity program
+Added: + Increase in third-party software costs of $2.9 million primarily due to the number of licenses needed and also price increases for the software being used
+Added: + Increase in amortization of capitalized software and content development costs of $2.8 million due to our continued investments in the innovation and security of our solutions
+Added: - Decrease in stock-based compensation costs of $1.4 million primarily due to overall Company performance against 2024 goals and a decrease in the grant date fair value of equity award grants
Recurring gross margin increased by 10 basis points primarily due to the increase in recurring revenue outpacing the increase in cost of recurring revenue.
3 unchanged sentences
YoY Growth (%) YoY Growth (%)
−Removed: One-time services and other revenue is comprised of fees for one-time consulting (including creative services), analytic and onsite training services, and fees for retained and managed services contracts that we do not expect to have a term consistent with our cloud solution contracts.
+Added: One-time services and other revenue is comprised of fees for one-time consulting, analytic and onsite training services, and fees for retained and managed services contracts that we do not expect to have a term consistent with our cloud solution contracts.
Cost of one-time services and other is primarily comprised of compensation costs for professional services and onsite training personnel, other costs incurred in providing onsite customer training, third-party contractor expenses, data expense incurred to perform one-time analytic services, third-party software royalties, allocated depreciation, facilities and IT support costs and amortization of intangible assets from business combinations.
2 unchanged sentences
One-time services and other revenue decreased by $7.5 million, or 22.2%, driven primarily by the following:
−Removed: - Decrease in one-time consulting revenue of $9.2 million primarily due to less sales of creative services and implementation and customization services.
−Removed: Also contributing is an increase in utilization of third-party service delivery partners.
−Removed: For several years, we have been strategically shifting away from a one-time services business model towards sales of retained and managed services and also embedding services in our renewable cloud solution contracts.
−Removed: Retained and managed services contracts that we expect to have a term consistent with our cloud solution contracts, and embedded services are recorded as recurring revenue.
−Removed: - Decrease in one-time analytics revenue of $3.0 million as analytics are generally integrated in our cloud solutions
+Added: - Decrease in one-time consulting revenue of $7.5 million primarily due to a decrease of $7.4 million resulting from our sale of EVERFI Limited as discussed in Note 3 to our consolidated financial statements in this report.
Cost of one-time services and other decreased $10.0 million or 31.6%, primarily driven by the following:
−Removed: - Decrease in compensation costs of $7.9 million primarily related to our targeted workforce reductions during the fourth quarter of 2022 and first quarter of 2023 and a continued shift in resources historically supporting one-time services and other towards recurring revenue
−Removed: - Decrease in employee severance of $1.2 million primarily due to our targeted workforce reductions discussed above, the majority of which were recorded in cost of one-time services and other in the fourth quarter of 2022
−Removed: - Decrease in direct costs of revenue of $1.2 million primarily related to our decrease in sales of creative services
−Removed: + Increase in third-party contractor costs of $1.2 million primarily due to an increase in partners delivering services
−Removed: One-time services and other gross margin decreased by 320 basis points primarily due to the decrease in one-time services and other revenue outpacing the decrease in cost of one-time services and other revenue.
+Added: - Decrease in compensation costs of $5.9 million primarily related to our sale of EVERFI Limited as discussed above and a continued shift in resources historically supporting one-time services and other towards recurring revenue
+Added: - Decrease in direct costs of revenue of $2.7 million primarily due to our sale of EVERFI Limited as discussed above
+Added: One-time services and other gross margin increased by 1,130 basis points primarily due to the decrease in cost of one-time services and other revenue outpacing the decrease in one-time services and other revenue.
Operating Expenses
13 unchanged sentences
The decreases in dollars and as a percentage of total revenue were primarily driven by the following:
−Removed: - Net decreases in the following costs primarily due to our targeted workforce reductions discussed above:
−Removed: • Decrease in compensation costs other than stock-based compensation of $10.5 million;
−Removed: • Decrease in commissions expense of $1.3 million;
−Removed: partially offset by
−Removed: • Increase in severance costs of $1.5 million
−Removed: - Decrease in third-party contractor costs of $3.1 million primarily related to strategic consulting costs incurred during 2022
−Removed: + Increase in stock-based compensation costs of $3.5 million primarily due to overall Company performance against 2023 goals and 2022 performance-based equity award adjustments, partially offset by the targeted workforce reductions during the fourth quarter of 2022 and first quarter of 2023
−Removed: + Increase in conference and travel costs of $1.0 million primarily due to our annual user conference, bbcon ®, which was held in-person in November 2023 for the first time since the pandemic
+Added: - Decrease in commissions expense of $12.0 million primarily due to a prospective increase in the period of benefit over which we amortized costs of obtaining contracts with customers from 5 to 6 years beginning in the year ending December 31, 2024.
+Added: Also contributing to the decrease in commissions expense were a decrease in commissionable bookings primarily due to EVERFI and fewer sales headcount.
+Added: - Decrease in stock-based compensation costs of $6.9 million primarily due overall Company performance against 2024 goals and a decrease in the grant date fair value of equity award grants
+Added: - Decrease in severance costs of $2.2 million related to our prior period targeted workforce reductions
+Added: + Increase in advertising costs of $4.6 million primarily due to increased digital marketing spend related to JustGiving and, to a lesser extent, increased marketing related to EVERFI while we explored strategic options for the business
Research and development
2 unchanged sentences
We also continue to invest heavily in the security of our solutions.
−Removed: Research and development expense decreased by $3.6 million, or 2.3%.
−Removed: The decreases in dollars and as a percentage of total revenue were primarily driven by the following:
−Removed: - Decrease in third-party contractor costs of $6.5 million primarily due to a decrease in our use of third-party software developers
−Removed: - Decrease in compensation costs other than stock-based compensation of $3.9 million primarily due to our targeted workforce reductions discussed above
−Removed: + Increase in stock-based compensation of $6.6 million primarily due to overall Company performance against 2023 goals and 2022 performance-based equity award adjustments, partially offset by the targeted workforce reductions during the fourth quarter of 2022 and first quarter of 2023
+Added: Research and development expense increased by $7.3 million, or 4.8%.
+Added: The increases in dollars and as a percentage of total revenue were primarily driven by the following:
+Added: + Increase in compensation costs other than stock-based compensation of $6.6 million primarily related to an increase in resources dedicated to the security-related compliance of our solutions
+Added: + Increase in third-party contractor costs of $3.4 million largely related to enhancements to our cybersecurity program
+Added: + Increase in allocated overhead costs of $2.7 million primarily related to increased headcount discussed above
+Added: - Decrease in stock-based compensation of $4.3 million primarily due overall Company performance against 2024 goals and a decrease in the grant date fair value of equity award grants
+Added: - Decrease in employee severance costs of $1.1 million primarily due to our prior period targeted workforce reductions discussed above
Not included in research and development expense for 2024 and 2023 were $60.8 million and $60.7 million, respectively, of qualifying costs associated with software and content development activities that are required to be capitalized under GAAP, such as those for our cloud solutions, as well as development costs associated with acquired companies.
Qualifying capitalized software and content development costs associated with our cloud solutions and online educational courses are subsequently amortized to cost of recurring revenue over the related asset's estimated useful life, which generally range from three to seven years.
−Removed: We expect that the amount of software and content development costs capitalized will be relatively consistent in the near-term as we continue making investments in innovation, quality, security and the integration of our solutions, which we believe will drive long-term revenue growth.
+Added: We expect that the amount of software development costs capitalized will modestly decrease in the near-term due to the disposition of EVERFI.
+Added: We continue to prioritize making investments in innovation, quality, security and the integration of our solutions, which we believe will drive long-term revenue growth.
2024 Form 10-K
4 unchanged sentences
The decreases in dollars and as a percentage of total revenue were primarily driven by the following:
−Removed: - Decrease in compensation costs other than stock-based compensation of $5.0 million primarily due to our targeted workforce reductions discussed above
−Removed: - Decrease in third-party contractor costs of $2.7 million primarily due to our focus on cost management
−Removed: - Decrease in Security Incident-related expenses of $2.3 million.
+Added: - Decrease in Security Incident-related expenses of $39.7 million largely related to decreases in loss contingency accruals.
See "Security Incident update" above on page 40
−Removed: - A $2.3 million noncash impairment charge during the second quarter of 2022 against previously capitalized software development costs that reduced the carrying value of those assets to zero.
−Removed: The impairment charge resulted primarily from our decision to end customer support for certain solutions and did not reoccur in 2023
−Removed: - Decrease in corporate costs of $1.3 million primarily related to the release of certain accrued tax liabilities due to favorable sales tax rulings, partially offset by an increase in bad debt expense
−Removed: - Decrease in rent expense of $1.1 million
−Removed: + Increase in stock-based compensation costs of $5.2 million primarily due to overall Company performance against 2023 goals and 2022 performance-based equity award adjustments, partially offset by the targeted workforce reductions during the fourth quarter of 2022 and first quarter of 2023
−Removed: + Increase in acquisition and disposition-related costs of $1.3 million primarily related to the noncash impairment charges against certain operating lease right-of-use assets and property and equipment assets resulting from the sublease of our Washington, DC office location;
−Removed: partially offset by the release of $1.4 million in accrued contingent consideration related to our Kilter acquisition during the second quarter of 2023 and a $2.0 million noncash impairment of certain insignificant intangible assets that were held for sale during the second quarter of 2022 which did not reoccur in 2023
+Added: - Decrease in stock-based compensation costs of $9.0 million primarily due to overall Company performance against 2024 goals and a decrease in the grant date fair value of equity award grants
+Added: - Increase in total costs allocated from general and administrative expense of $4.4 million primarily related to investments in security tools.
+Added: Depreciation, facilities and IT support costs are pooled and recorded to general and administrative expense and allocated to other lines of our statements of comprehensive loss based on headcount.
+Added: - Decrease in acquisition and disposition-related costs of $1.4 million primarily related to less noncash impairment charges against certain operating lease right-of-use assets and property and equipment assets resulting from the subleases of our Washington, DC office location, partially offset by costs associated with the disposition of EVERFI Limited;
+Added: see Note 6 and Note 3 to our consolidated financial statements in this report for more information.
+Added: - Decrease in severance costs of $1.0 million due to our prior period targeted workforce reductions discussed above
+Added: + Increase in compensation costs other than stock-based compensation of $5.0 million primarily due to an increase in resources dedicated to our cybersecurity program
+Added: + Increase in corporate costs of $2.4 million primarily related to an increase in bad debt expense.
+Added: The increase in bad debt expense was driven by an increase in write-offs.
+Added: + Increase in third-party software costs of $1.5 million due to primarily due to the number of licenses needed and also price increases for the software being used
2024 Form 10-K
3 unchanged sentences
Percentages indicate expenses as a percentage of total revenue
−Removed: Interest expense increased in dollars and as a percentage of total revenue during 2023 when compared to 2022, primarily due to an increase in our weighted average effective interest rates.
+Added: Interest expense increased in dollars and as a percentage of total revenue during 2024 when compared to 2023, primarily due to our incremental borrowings to fund our ASR Transaction (as defined on page 105 ) and other stock repurchases.
We currently expect interest expense for the full year 2025 to be approximately $65 million to $69 million although our interest expense in connection with the variable rate portion of our outstanding debt could increase in a rising interest rate environment.
3 unchanged sentences
Other income ($M)
−Removed: Percentages indicate expenses as a percentage of total revenue
+Added: Percentages indicate other income as a percentage of total revenue
Other income increased in dollars and as a percentage of total revenue during 2024 when compared to 2023, primarily due to an increase in interest income.
−Removed: Interest income increased primarily due to higher interest earned on restricted cash held and payable by us to customers for our payment processing solutions.
+Added: Interest income increased primarily due to higher interest earned on restricted cash due to customers for our payment processing solutions.
See Note 8 to our consolidated financial statements in this report for more information regarding our other income.
14 unchanged sentences
We generally invoice our customers with recurring revenue contracts in annual cycles 30 days prior to the end each one-year period.
−Removed: The increase in deferred revenue during the year ended December 31, 2023 was primarily due to new subscription sales of our cloud solutions and progress in initiatives to bring our pricing in line with the market.
+Added: The decrease in deferred revenue during the year ended December 31, 2024 was primarily due to our divestiture of EVERFI on December 31, 2024.
Historically, due to the timing of customer budget cycles, we have an increase in customer contract renewals at or near the beginning of our third quarter.
Generally, our lowest balance of deferred revenue during the year is at the end of our first quarter.
−Removed: Income tax provision (benefit) ($M)
+Added: Income tax (benefit) provision ($M)
Percentages indicate effective income tax rates
Our effective income tax rate may fluctuate quarterly and annually as a result of factors, including changes in tax law in jurisdictions where we conduct business, transactions entered into, changes in the geographic distribution of our earnings or losses, and our assessment of certain tax contingencies and valuation allowances.
−Removed: We have deferred tax assets for federal, state, and international net operating loss carryforwards and tax credits.
−Removed: The federal and state net operating loss carryforwards are subject to various Internal Revenue Code limitations and applicable state tax laws.
−Removed: A portion of the foreign and state net operating loss carryforwards and a portion of state tax credits have a valuation reserve due to the uncertainty of realizing such carryforwards and credits in the future.
+Added: We have deferred tax assets for federal, state, and international net operating loss carryforwards, a federal and state capital loss carryforward and tax credits.
+Added: The federal and state net operating loss and capital loss carryforwards are subject to various Internal Revenue Code limitations and applicable state tax laws.
+Added: The foreign net operating loss carryforwards have a valuation reserve due to the uncertainty of realizing such carryforwards in the future.
+Added: Further, as of December 31, 2024, we recorded a valuation allowance against all of our U.S.
+Added: deferred tax assets in excess of deferred tax liabilities due to combination of our cumulative pretax loss position and net deferred tax asset position resulting from divestiture of EVERFI.
+Added: We intend to continue maintaining a full valuation allowance on our U.S.
+Added: net deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances.
We file income tax returns in the U.S.
2 unchanged sentences
federal income tax examination for calendar tax years ending 2021 through 2024, as well as state and foreign income tax examinations for various years depending on statute of limitations of those jurisdictions.
+Added: 2024 Form 10-K
+Added: Blackbaud, Inc.
We have taken federal and state tax positions for which it is reasonably possible that the total amount of unrecognized tax benefits may decrease within the next twelve months.
1 unchanged sentence
The reasonably possible decrease at December 31, 2024 was insignificant.
−Removed: 2023 Form 10-K
−Removed: Blackbaud, Inc.
We recognize accrued interest and penalties, if any, related to unrecognized tax benefits as a component of income tax expense.
−Removed: The increase in our effective income tax rate for year ended December 31, 2023, when compared to the same period in 2022, was primarily attributable to higher 2023 non-deductible accruals for loss contingencies related to the Security Incident and other non-deductible expenses and tax rate changes, partially offset by increased tax credits.
−Removed: Furthermore, our 2023 effective tax rate was negatively impacted by higher tax rates in foreign jurisdictions in which we operate which were predominantly due to UK tax rate increases.
−Removed: 2023 Form 10-K
−Removed: Blackbaud, Inc.
+Added: The decrease in our effective income tax rate for year ended December 31, 2024, when compared to the same period in 2023, was primarily attributable to the valuation allowance recorded in the current period.
+Added: As of December 31, 2024, we recorded a valuation allowance against all of our U.S.
+Added: deferred tax assets in excess of deferred tax liabilities due to the combination of our cumulative pretax loss position and net deferred tax asset position resulting from our divestiture of EVERFI.
+Added: We intend to continue maintaining a full valuation allowance on our U.S.
+Added: net deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances.
+Added: Furthermore, the effect of our various rate drivers is reversed by the Company’s 2024 loss position versus income in 2023.
Non-GAAP Financial Measures
6 unchanged sentences
We believe that these non-GAAP financial measures reflect our ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of trends in our business.
+Added: 2024 Form 10-K
+Added: Blackbaud, Inc.
Years ended December 31,
10 unchanged sentences
Non-GAAP gross margin 61.5 % 60.9 %
−Removed: GAAP income (loss) from operations $ 44.7 $ (28.5)
+Added: GAAP (loss) income from operations $ (270.5) $ 44.7
GAAP operating margin (23.4) % 4.0 %
4 unchanged sentences
Acquisition and disposition-related costs (2)
−Removed: Restructuring and other real estate activities — 0.1
−Removed: Security Incident-related costs, net of insurance (4)
−Removed: Impairment of capitalized software development costs
+Added: Security Incident-related costs (3)
+Added: EVERFI impairment and disposition charges
Non-GAAP income from operations (1)
1 unchanged sentence
Non-GAAP operating margin 27.7 % 26.6 %
−Removed: GAAP income (loss) before provision (benefit) for income taxes $ 17.6 $ (55.6)
−Removed: GAAP net income (loss) $ 1.8 $ (45.4)
−Removed: Shares used in computing GAAP diluted earnings (loss) per share 53,721,342 51,569,148
−Removed: GAAP diluted earnings (loss) per share $ 0.03 $ (0.88)
+Added: GAAP (loss) income before (benefit) provision for income taxes $ (311.6) $ 17.6
+Added: GAAP net (loss) income $ (283.2) $ 1.8
+Added: Shares used in computing GAAP diluted (loss) earnings per share 50,560,538 53,721,342
+Added: GAAP diluted (loss) earnings per share $ (5.60) $ 0.03
Non-GAAP adjustments:
−Removed: GAAP income tax provision (benefit) 15.8 (10.2)
+Added: GAAP income tax (benefit) provision (28.4) 15.8
Total non-GAAP adjustments affecting income from operations 590.6 249.4
5 unchanged sentences
Non-GAAP diluted earnings per share $ 4.07 $ 3.98
−Removed: 2023 Form 10-K
−Removed: Blackbaud, Inc.
(1) The individual amounts for each year may not sum to subtotal, non-GAAP gross profit, non-GAAP income from operations, non-GAAP income before provision for income taxes or non-GAAP net income due to rounding.
−Removed: (2) Includes a $2.0 million noncash impairment of certain intangible assets held for sale during the twelve months ended December 31, 2022.
−Removed: (3) Includes noncash impairment charges incurred during the twelve months ended December 31, 2023 related to the sublease of our Washington, DC office location the lease of which was acquired during the EVERFI acquisition.
−Removed: (4) Includes Security Incident-related costs incurred during the twelve months ended December 31, 2023 of $53.4 million, which includes approximately $31.0 million in settlements and recorded aggregate liabilities for loss contingencies, net of insurance recoveries during the same period of $0.0 million and during the twelve months ended December 31, 2022 of $57.6 million, which included approximately $23.0 million in recorded aggregate liabilities for loss contingencies, net of insurance recoveries during the same period of $1.9 million.
+Added: (2) Includes noncash impairment charges incurred during the twelve months ended December 31, 2024 and 2023 related to the subleases of our Washington, DC office location the lease of which was acquired during the EVERFI acquisition.
+Added: (3) Includes Security Incident-related costs incurred during the twelve months ended December 31, 2024 of $13.7 million, which included approximately $6.8 million in recorded liabilities for loss contingencies, and during the twelve months ended December 31, 2023 of $53.4 million, which included approximately $31.0 million in recorded liabilities for loss contingencies.
Recorded expenses consisted primarily of payments to third-party service providers and consultants, including legal fees, as well as settlements of customer claims, negotiated settlements and accruals for certain loss contingencies.
Not included in this adjustment were costs associated with enhancements to our cybersecurity program.
−Removed: For full year 2024, we currently expect net pre-tax expense of approximately $5 million to $10 million and net cash outlays of approximately $8 million to $13 million for ongoing legal fees related to the Security Incident.
+Added: For full year 2025, we currently expect pre-tax expenses of approximately $2 million to $3 million and cash outlays of approximately $3 million to $4 million for ongoing legal fees related to the Security Incident.
In line with our policy, legal fees are expensed as incurred.
As of December 31, 2024, we have recorded approximately $0.7 million in aggregate liabilities for loss contingencies based primarily on recent negotiations with certain customers related to the Security Incident that we believe we can reasonably estimate.
−Removed: In connection with the settlement of the multi-state Attorneys General investigation (as previously disclosed on October 5, 2023), we paid $49.5 million during the fourth quarter of 2023.
−Removed: There are other Security Incident-related matters, including customer claims, customer constituent class actions and governmental investigations, for which we have not recorded a liability for a loss contingency as of December 31, 2023 because we are unable at this time to reasonably estimate the possible loss or range of loss.
−Removed: Each of these matters could, separately or in the aggregate, result in an adverse judgement, settlement, fine, penalty or other resolution, the amount, scope and timing of which we are currently unable to predict, but could have a material adverse impact on our results of operations, cash flows or financial condition.
−Removed: (5) We apply a non-GAAP effective tax rate of 20.0% when calculating non-GAAP net income and non-GAAP diluted earnings per share.
−Removed: Beginning in 2024, we intend to update the non-GAAP tax rate we apply when calculating non-GAAP net income and non-GAAP diluted earnings per share in future periods.
−Removed: Since the first quarter of 2018, for the purposes of determining non-GAAP net income, we have utilized a non-GAAP tax rate of 20.0% in our calculation of the assumed non-GAAP income tax provision.
−Removed: We intend to adjust this rate to 24.5% to better reflect our periodic effective tax rate calculated in accordance with GAAP and our current expectations.
−Removed: The increase in our non-GAAP tax rate is primarily driven by increases in income tax rates in jurisdictions we operate in.
−Removed: Furthermore, as profitability increases, the effect of tax impacting items, including research and development credits, lessens such that our assumed non-GAAP tax rate moves closer to the statutory rate.
−Removed: The increase in our non-GAAP tax rate is primarily driven by increases in income tax rates in jurisdictions we operate in.
−Removed: Furthermore, as our non-GAAP profitability increases, the effect of tax impacting items lessens such that our assumed non-GAAP tax rate moves closer to the statutory tax rate.
−Removed: The non-GAAP tax rate utilized in future periods will be reviewed annually to determine whether it remains appropriate in consideration of our financial results including our periodic effective tax rate calculated in accordance with GAAP, our operating environment and related tax legislation in effect and other factors deemed necessary.
−Removed: All measures of the tax impact related to non-GAAP net income and non-GAAP diluted earnings per share included above are calculated under our historical methodology.
+Added: There are other Security Incident-related matters for which we have not recorded a liability for a loss contingency as of December 31, 2024 because we are unable at this time to reasonably estimate the possible loss or range of loss.
+Added: Each of these matters could, separately or in the aggregate, result in an adverse judgment, settlement, fine, penalty or other resolution, the amount, scope and timing of which we are currently unable to predict, but could have a material adverse impact on our results of operations, cash flows or financial condition.
+Added: (4) Beginning in 2024, we now apply a non-GAAP effective tax rate of 24.5% when calculating non-GAAP net income and non-GAAP diluted earnings per share.
+Added: For the twelve months ended December 31, 2023, the tax impact related to non-GAAP adjustments is calculated under our historical non-GAAP effective tax rate of 20.0%.
2024 Form 10-K
3 unchanged sentences
We believe that these non-GAAP measures are useful to investors, as a supplement to GAAP measures, for evaluating the periodic growth of our business on a consistent basis.
−Removed: Each of these measures of non-GAAP organic revenue growth excludes incremental acquisition-related revenue attributable to companies acquired in the current fiscal year.
+Added: Each of these measures of non-GAAP organic revenue growth excludes incremental acquisition-related revenue attributable to companies, if any, acquired in the current fiscal year.
For companies, if any, acquired in the immediately preceding fiscal year, each of these non-GAAP organic revenue growth measures reflects presentation of full year incremental non-GAAP revenue derived from such companies as if they were combined throughout the prior period.
27 unchanged sentences
Non-GAAP organic recurring revenue growth on constant currency basis 5.1 %
−Removed: (1) Non-GAAP revenue from divested businesses excludes revenue associated with divested businesses.
+Added: (1) Includes EVERFI revenue of $85.5 million and $106.9 million for the year ended December 31, 2024 and 2023, respectively.
+Added: (2) Non-GAAP revenue from divested businesses excludes revenue associated with divested businesses in the prior period.
The exclusion of the prior period revenue is to present the results of the divested business with the results of the combined company for the same period of time in both the prior and current periods.
5 unchanged sentences
Blackbaud, Inc.
−Removed: We previously defined Rule of 40 as non-GAAP organic revenue growth plus non-GAAP adjusted EBITDA margin.
+Added: We define Rule of 40 as non-GAAP organic revenue growth plus non-GAAP adjusted EBITDA margin.
Non-GAAP adjusted EBITDA is defined as GAAP net income plus interest, net;
6 unchanged sentences
acquisition and disposition-related costs;
−Removed: restructuring and other real estate activities;
−Removed: Security Incident-related costs, net of insurance;
−Removed: and impairment of capitalized software development costs.
−Removed: Beginning in the fiscal quarter ended June 30, 2022, we now also include in non-GAAP adjusted EBITDA impairment of capitalized software and content development costs because we believe it is not directly related to our operating performance in any particular period.
+Added: Security Incident-related costs;
+Added: and impairment and disposition charges.
Years ended December 31,
(dollars in millions) 2024 2023
−Removed: GAAP net income (loss) $ 1.8 $ (45.4)
+Added: GAAP net (loss) income $ (283.2) $ 1.8
Non-GAAP adjustments:
Interest, net 45.8 31.1
−Removed: GAAP income tax provision (benefit)
+Added: GAAP income tax (benefit) provision
Amortization of intangibles from business combinations 60.5 55.6
7 unchanged sentences
Acquisition and disposition-related costs (4)
−Removed: Restructuring and other real estate activities
−Removed: Security Incident-related costs, net of insurance (4)
−Removed: Impairment of capitalized software development costs
+Added: Security Incident-related costs (4)
+Added: EVERFI impairment and disposition charges
Non-GAAP Adjusted EBITDA (2)
50 unchanged sentences
Our expenses, other than transaction-based costs related to our payments services, do not vary significantly as a result of these factors, but do fluctuate on a quarterly basis due to varying timing of expenditures.
−Removed: Our cash flow from operations normally fluctuates quarterly due to the combination of the timing of customer contract renewals including renewals associated with customers of acquired companies, delivery of professional services and occurrence of customer events, as well as merit-based salary increases, among other factors.
+Added: Our cash flow from operations normally fluctuates quarterly due to the combination of the timing of customer contract renewals, delivery of professional services and occurrence of customer events, as well as merit-based salary increases, among other factors.
Historically, due to lower revenues in our first quarter, combined with the payment of certain annual vendor contracts, our cash flow from operations has been lowest in our first quarter.
5 unchanged sentences
Blackbaud, Inc.
−Removed: These patterns may change as a result of the continued shift to online giving, growth in volume of transactions for which we process payments, large dollar customer bookings and contract renewals, or as a result of acquisitions, new market opportunities, new solution introductions or other factors.
+Added: These patterns may change as a result of the continued shift to online giving, growth in volume of transactions for which we process payments, large dollar customer bookings and contract renewals, fluctuations in the timing of vendor payments or as a result of acquisitions, dispositions, such as our sale of EVERFI on December 31, 2024, new market opportunities, new solution introductions or other factors.
Liquidity and Capital Resources
14 unchanged sentences
(139.4) (143.0) (2.5) %
−Removed: Our principal sources of liquidity are our operating cash flow, funds available under the 2020 Credit Facility and cash on hand.
+Added: Our principal sources of liquidity are our operating cash flow, funds available under the 2024 Credit Facilities and cash on hand.
Our operating cash flow depends on continued customer renewal of our subscription and maintenance arrangements, market acceptance of our solutions and services, the volume and size of transactions for which we process payments and our customers' ability to pay.
6 unchanged sentences
Subject to certain conditions, this registration statement will be effective through January 9, 2028.
−Removed: We resumed stock repurchases during the fourth quarter of 2023 under our then existing stock repurchase program that authorized us to purchase up to $250.0 million of our outstanding shares of common stock.
−Removed: On January 17, 2024, our Board of Directors reauthorized, expanded and replenished our stock repurchase program by raising the total capacity under the program from $250.0 million to $500.0 million available for repurchases.
−Removed: The remaining amount available to purchase stock under the stock repurchase program was $499.4 million as of February 16, 2024.
−Removed: We plan to repurchase shares going forward to at least offset the dilution from our annual stock-based compensation and possibly beyond that amount as market conditions and our strategic plans permit.
−Removed: See additional details regarding our stock repurchase program below on page 56 .
At December 31, 2024, our total cash and cash equivalents balance included approximately $13.9 million of cash that was held by operations outside the U.S.
6 unchanged sentences
Throughout 2024 and 2023, our cash flows from operations were derived principally from:
−Removed: (i) our earnings from on-going operations prior to non-cash expenses such as depreciation, amortization, stock-based compensation, deferred income taxes, amortization of deferred financing costs and debt discount and adjustments to our provision for credit losses and sales returns;
+Added: (i) our earnings from on-going operations prior to non-cash expenses such as depreciation, amortization, stock-based compensation, deferred income taxes, amortization of deferred financing costs and debt discount, adjustments to our provision for credit losses and sales returns, the EVERFI impairment charges, loss on disposition of business;
and (ii) changes in our working capital.
Working capital changes are comprised of changes in accounts receivable, prepaid expenses and other assets, trade accounts payable, accrued expenses and other liabilities and deferred revenue.
−Removed: Net cash provided by operating activities decreased by $4.3 million during the year ended December 31, 2023, when compared to the same period in 2022, primarily due to a $71.3 million increase in net income adjusted for non-cash expenses and a $75.5 million decrease in cash flow from operations associated with working capital.
−Removed: The decrease in cash flow from operations associated with working capital during 2023, when compared to 2022, was primarily due to:
+Added: Net cash provided by operating activities increased by $96.3 million during the year ended December 31, 2024, when compared to the same period in 2023, primarily due to a $49.4 million increase in net income adjusted for non-cash expenses and a $46.9 million increase in cash flow from operations associated with working capital.
+Added: The increase in cash flow from operations associated with working capital during 2024, when compared to 2023, was primarily due to:
• fluctuations in the timing of vendor payments;
• a decrease in accrued expenses related to the Security Incident;
+Added: partially offset by
+Added: • an increase in cash taxes paid.
+Added: In February 2025, we made a one-time cash release payment of $28 million to the lessor in connection with a release from our lease for office space in Washington, DC (which was acquired as part of our acquisition of EVERFI in December 2021).
+Added: Due to our remote-first workforce strategy, we had not used the office space since February 2023 and had subleased a portion of the space.
Security Incident update
1 unchanged sentence
Accordingly, the Security Incident has negatively impacted, and we expect it to continue for the foreseeable future to negatively impact, our GAAP profitability and GAAP cash flow (see discussion regarding non-GAAP free cash flow and non-GAAP adjusted free cash flow on page 53 ).
−Removed: For full year 2023, we had net cash outlays of $78.0 million related to the Security Incident, which included ongoing legal fees, the $3.0 million civil penalty paid during the first quarter of 2023 related to the SEC settlement and the $49.5 million civil penalty paid during the fourth quarter of 2023 related to the multi-state Attorneys General settlement.
+Added: For full year 2024, we had net cash outlays of $15.9 million related to the Security Incident, which included ongoing legal fees and the $6.8 million paid during the third quarter of 2024 related to our settlement with the Attorney General of the State of California.
For full year 2025, we currently expect net pre-tax expense of approximately $2.0 million to $3.0 million and net cash outlays of approximately $3.0 million to $4.0 million for ongoing legal fees related to the Security Incident.
1 unchanged sentence
It is reasonably possible that our estimated or actual losses may change in the near term for those matters and be materially in excess of the amounts accrued, but we are unable at this time to reasonably estimate the possible additional loss.
−Removed: There are other Security Incident-related matters, including customer claims, customer constituent class actions and governmental investigations, for which we have not recorded a liability for a loss contingency as of December 31, 2023 because we are unable at this time to reasonably estimate the possible loss or range of loss.
−Removed: Each of these matters could, separately or in the aggregate, result in an adverse judgement, settlement, fine, penalty or other resolution, the amount, scope and timing of which we are currently unable to predict, but could have a material adverse impact on our results of operations, cash flows or financial condition.
+Added: There are other Security Incident-related matters for which we have not recorded a liability for a loss contingency as of December 31, 2024 because we are unable at this time to reasonably estimate the possible loss or range of loss.
+Added: Each of these matters could, separately or in the aggregate, result in an adverse judgment, settlement, fine, penalty or other resolution, the amount, scope and timing of which we are currently unable to predict, but could have a material adverse impact on our results of operations, cash flows or financial condition.
2024 Form 10-K
2 unchanged sentences
During 2025, we expect our total capital expenditures, including estimated outlays for capitalized software development costs, to be between approximately $55.0 million and $65.0 million.
−Removed: Net cash used in investing activities of $64.4 million decreased by $21.2 million during 2023, when compared to 2022.
−Removed: During 2022, we received net cash of $6.4 million related to our disposition of Blackbaud FIMS™ and DonorCentral® NXT.
−Removed: During 2022, we used $20.9 million of net cash for our acquisitions of EVERFI and Kilter, comprised primarily of (i) $17.4 million that had not been paid by EVERFI to its former option holders as of December 31, 2021, solely due to the timing of the acquisition on the last day of 2021;
−Removed: (ii) $2.9 million that was paid to acquire Kilter;
−Removed: and (iii) $2.6 million that was paid to a number of EVERFI's selling shareholders after determining they would be paid in cash, rather than shares of our common stock.
+Added: Net cash used in investing activities of $73.4 million increased by $9.0 million during 2024, when compared to 2023.
During 2024, we used $59.8 million for software and content development costs, which was up $0.3 million from cash spent during 2023.
−Removed: We also spent $4.7 million of cash for purchases of property and equipment during 2023, which was a decrease of $7.6 million from cash spent in 2022.
+Added: We also spent $7.4 million of cash for purchases of property and equipment during 2024, which was an increase of $2.8 million from cash spent in 2023.
+Added: In addition, we used net cash of $1.2 million in the disposition of a business and $5.0 million for a minority investment in a business during 2024.
Financing Cash Flow
−Removed: During 2023, we had a net decrease in borrowings of $81.4 million.
−Removed: During 2023, we repurchased $18.8 million of our common stock while we did not repurchase any of our common stock during 2022 (see additional details below regarding our stock repurchase program).
+Added: During 2024, we had a net increase in borrowings of $296.7 million, primarily due to our stock repurchase program, including our ASR Transaction (as defined on page 105 ) in March 2024.
+Added: During 2024, we repurchased $418.0 million of our common stock compared to $18.8 million during 2023 (see additional details below regarding our stock repurchase program).
+Added: We also paid $6.5 million in debt issuance costs in conjunction with our April 2024 refinancing.
We paid $56.8 million to satisfy tax obligations of employees upon settlement or exercise of equity awards during 2024 compared to $35.9 million during 2023.
1 unchanged sentence
Most of our equity awards currently vest in our first quarter.
−Removed: During 2023 , cash flow from financing activities associated with changes in restricted cash due to customers decreased $6.8 million , compared to an increase of $111.4 million during 2022 .
+Added: During 2024 , cash flow from financing activities associated with changes in restricted cash due to customers increased $47.0 million , compared to a decrease of $6.8 million during 2023 .
This line in the statement of cash flows represents the change in the amount of restricted cash held and payable by us to customers from one period to the next.
1 unchanged sentence
Stock repurchase program
−Removed: In December 2021, our Board of Directors reauthorized, expanded and replenished our stock repurchase program that authorizes us to purchase up to $250.0 million of our outstanding shares of common stock.
+Added: On January 17, 2024, our Board of Directors reauthorized, expanded and replenished our stock repurchase program by raising the total capacity under the program from $250.0 million to $500.0 million available for repurchases.
The program does not have an expiration date.
2 unchanged sentences
The repurchase program may be limited, suspended or discontinued at any time without prior notice.
−Removed: During the year ended December 31, 2023, we repurchased 221,836 shares for $18.8 million.
−Removed: The remaining amount available to purchase stock under the then approved stock repurchase program was $231.2 million as of December 31, 2023.
−Removed: On January 17, 2024, our Board of Directors reauthorized, expanded and replenished our stock repurchase program by raising the total capacity under the program from $250.0 million to $500.0 million available for repurchases.
−Removed: Between January 1, 2024 and January 17, 2024, we repurchased $22.3 million under the prior authorization.
−Removed: Between January 18, 2024 and February 16, 2024, we repurchased an additional 7,114 shares for $0.6 million under the new authorization.
−Removed: The remaining amount available to purchase stock under the stock repurchase program was $499.4 million as of February 16, 2024.
+Added: In March 2024, we announced that we intended to repurchase during 2024 between 7% and 10% of our outstanding common stock as of December 31, 2023 under our repurchase program.
+Added: Consistent with that commitment, in March 2024, we entered into the ASR Transaction to repurchase an aggregate $200 million of shares of our common stock.
+Added: Pursuant to the terms of the ASR Transaction, we provided the financial institution with a prepayment of $200 million and received an initial delivery of 2.1 million shares of our common stock, representing approximately 70% of the total shares then-expected to be repurchased under the ASR Transaction.
+Added: The final number of shares of common stock delivered to us under the ASR Transaction was based on the average of the daily volume-weighted average prices of the common stock during the term of the ASR Transaction, less a discount and subject to customary adjustments upon events affecting the common stock (e.g., dilutive or concentrative events, mergers and acquisitions, and market disruptions).
+Added: We funded the ASR Transaction prepayment with borrowings pursuant to a revolving credit loan under the then effective 2020 Credit Agreement.
+Added: On October 29, 2024, in connection with the settlement of the ASR Transaction, we received approximately 490,000 shares of our common stock, in addition to the 2.1 million shares received in March 2024.
+Added: No cash was exchanged as part of the settlement of the ASR Transaction.
2024 Form 10-K
Blackbaud, Inc.
−Removed: to repurchase shares going forward to at least offset the dilution from our annual stock-based compensation and possibly beyond that amount as market conditions and our strategic plans permit.
−Removed: 2020 Credit Facility
+Added: On July 16, 2024, our Board of Directors reauthorized, expanded and replenished our stock repurchase program by expanding the total capacity under the program from $500.0 million to $800.0 million available for repurchases.
+Added: During the year ended December 31, 2024, we repurchased an aggregate of 5,362,439 shares for $418.0 million, including the shares repurchased pursuant to the ASR Transaction and representing approximately 10.0% of the Company's common stock outstanding as of December 31, 2023.
+Added: When including the net share settlement on employee stock-based compensation, this figure increases to approximately 11%.
+Added: The remaining amount available to purchase stock under the approved stock repurchase program was $644.6 million as of December 31, 2024.
+Added: During 2025, we intend to repurchase between 3% and 5% of our outstanding common stock as of December 31, 2024 under our existing stock repurchase program.
+Added: 2024 Credit Facilities
Historically, we have drawn on our credit facility from time to time to help us meet financial needs primarily due to the seasonality of our cash flows from operations and financing for business acquisitions.
−Removed: At December 31, 2023, our available borrowing capacity under the 2020 Credit Facility was $384.5 million.
−Removed: The 2020 Credit Facility matures in October 2025.
−Removed: At December 31, 2023, the carrying amount of our debt under the 2020 Credit Facility was $720.6 million.
+Added: At December 31, 2024, our available borrowing capacity under the 2024 Credit Facilities was $468.7 million.
+Added: The 2024 Credit Facilities mature in April 2029.
+Added: At December 31, 2024, the carrying amount of our debt under the 2024 Credit Facilities was $1.0 billion.
Our average daily borrowings were $929.5 million during 2024.
−Removed: The term loans under the 2020 Credit Facility and our other debt require periodic principal payments.
−Removed: The balance of the term loans and any amounts drawn on the revolving credit loans are due upon maturity of the 2020 Credit Facility in October 2025.
+Added: The term loans under the 2024 Credit Facilities and our other debt require periodic principal payments.
+Added: The balance of the term loans and any amounts drawn on the revolving credit loans are due upon maturity of the 2024 Credit Facilities in April 2029.
Certain real estate loans (as described in Note 9 to our audited consolidated financial statements included in this report) also require periodic principal payments and the balances of the real estate loans are due upon maturity in April 2038.
−Removed: The following is a summary of the financial covenants under the 2020 Credit Facility:
+Added: The following is a summary of the financial covenants under the 2024 Credit Facilities:
Financial Covenant Requirement Ratio as of December 31, 2024
2 unchanged sentences
Interest Coverage Ratio ≥ 2.50 to 1.00 7.13 to 1.00
−Removed: (1) Under the terms of the 2020 Credit Facility, the Net Leverage Ratio requirement may be increased by up to 0.50 provided we satisfy certain requirements, including a permitted business acquisition, and provided that the maximum Net Leverage Ratio shall not exceed 4.25 to 1.00.
−Removed: Under the 2020 Credit Facility, we also have restrictions on our ability to declare and pay dividends and our ability to repurchase shares of our common stock.
+Added: (1) Under the terms of the 2024 Credit Facilities, the Net Leverage Ratio requirement may be increased by up to 0.50 provided we satisfy certain requirements, including a permitted business acquisition, and provided that the maximum Net Leverage Ratio shall not exceed 4.25 to 1.00.
+Added: Under the 2024 Credit Facilities, we also have restrictions on our ability to declare and pay dividends and our ability to repurchase shares of our common stock.
In order to pay any cash dividends and/or repurchase shares of stock:
−Removed: (i) no default or event of default shall have occurred and be continuing under the 2020 Credit Facility, and (ii) our pro forma net leverage ratio, as set forth in the 2020 Credit Facility, must be 0.25 less than the net leverage ratio requirement at the time of dividend declaration or stock repurchase.
−Removed: At December 31, 2023, we were in compliance with our debt covenants under the 2020 Credit Facility.
−Removed: See Note 9 to our consolidated financial statements included in this report for additional information regarding the 2020 Credit Facility.
+Added: (i) no default or event of default shall have occurred and be continuing under the 2024 Credit Facilities, and (ii) our pro forma net leverage ratio, as set forth in the 2024 Credit Facilities, must be 0.25 less than the net leverage ratio requirement at the time of dividend declaration or stock repurchase.
+Added: At December 31, 2024, we were in compliance with our debt covenants under the 2024 Credit Facilities.
+Added: See Note 9 to our consolidated financial statements included in this report for additional information regarding the 2024 Credit Facilities.
Commitments and Contingencies
7 unchanged sentences
Operating leases 6.3 39.1 45.4
−Removed: Interest payments on debt — 5.5 5.5
−Removed: Contingent consideration — 1.4 1.4
Unrecorded contractual obligations:
6 unchanged sentences
Blackbaud, Inc.
−Removed: As of December 31, 2023, we had total remaining principal payments of $781.1 million.
+Added: As of December 31, 2024, we had total remaining principal payments of $1.1 billion.
These payments represent principal payments only, under the following assumptions:
−Removed: (i) that the amounts outstanding under the 2020 Credit Facility, our real estate loans and our other debt at December 31, 2023 will remain outstanding until maturity, with minimum payments occurring as currently scheduled, and (ii) that there are no assumed future borrowings on the 2020 Revolving Facility for the purposes of determining minimum commitment amounts.
+Added: (i) that the amounts outstanding under the 2024 Credit Facilities, our real estate loans and our other debt at December 31, 2024 will remain outstanding until maturity, with minimum payments occurring as currently scheduled, and (ii) that there are no assumed future borrowings on the 2024 Revolving Facility for the purposes of determining minimum commitment amounts.
See Note 9 to our consolidated financial statements in this report for more information.
2 unchanged sentences
These payments represent our estimated future interest payments on debt using our debt balances and the related weighted average effective interest rates as of December 31, 2024, which includes the effect of interest rate swap agreements.
−Removed: The actual interest expense recognized in our consolidated statements of comprehensive income will depend on the amount of debt, the length of time the debt is outstanding and the interest rate, which could be different from our assumptions on our remaining principal payments described above.
+Added: The actual interest expense recognized in our consolidated statements of comprehensive loss will depend on the amount of debt, the length of time the debt is outstanding and the interest rate, which could be different from our assumptions on our remaining principal payments described above.
Operating leases
4 unchanged sentences
See Note 11 to our consolidated financial statements in this report for more information.
+Added: In February 2025, we made a one-time cash release payment of $28 million to the lessor in connection with a release from our lease for office space in Washington, DC (which was acquired as part of our acquisition of EVERFI in December 2021).
+Added: Due to our remote-first workforce strategy, we had not used the office space since February 2023 and had subleased a portion of the space.
Purchase obligations
5 unchanged sentences
The total liability for uncertain tax positions as of December 31, 2024 was $5.2 million.
−Removed: Our accrued interest and penalties related to tax positions taken on our tax returns was insignificant as of December 31, 2023.
−Removed: In connection with the settlement of the multi-state Attorneys General investigation relating to the Security Incident, as discussed in Note 11 to our consolidated financial statements in this report, we have agreed to implement and improve certain of our cybersecurity programs and tools through October 2030.
+Added: Our accrued interest and penalties related to tax positions taken on our tax returns was $0.9 million as of December 31, 2024.
+Added: In connection with the settlement of the multi-state Attorneys General investigation, the California Attorney General investigation and the FTC investigation relating to the Security Incident, as discussed in Note 11 to our consolidated financial statements in this report, we have agreed to implement and improve certain of our cybersecurity programs and tools through May 2044.
The currently anticipated costs in connection with these efforts are expected to be expensed as incurred.
−Removed: Contingent consideration
−Removed: In connection with our acquisition of Kilter, we are obligated to pay contingent consideration upon the achievement of certain milestones.
−Removed: For information regarding our contingent consideration obligations, see Note 3 to our consolidated financial statements in this report.
2024 Form 10-K
7 unchanged sentences
dollars for purposes of reporting our consolidated financial results.
−Removed: The accumulated currency translation adjustment, recorded within accumulated other comprehensive (loss) income as a component of stockholders’ equity, was a loss of $9.8 million as of December 31, 2023 and a loss of $14.9 million as of December 31, 2022.
+Added: The accumulated currency translation adjustment, recorded within accumulated other comprehensive loss as a component of stockholders’ equity, was a loss of $12.7 million as of December 31, 2024 and a loss of $9.8 million as of December 31, 2023.
We have entered into foreign currency forward contracts to hedge a portion of the foreign currency exposure that arises on translation of our investments denominated in British Pounds into U.S.
7 unchanged sentences
dollar strengthened, foreign currency translation resulted in a decrease in our revenues and expenses denominated in non-U.S.
−Removed: During 2023, foreign translation had an insignificant impact on our revenues and expenses denominated in non-U.S.
+Added: During 2024, foreign translation resulted in increases in our revenues and expenses denominated in non-U.S.
Though we have exposure to fluctuations in currency exchange rates, primarily those between the U.S.
dollar and both the British Pound and Canadian dollar, the impact has generally not been material to our consolidated results of operations or financial position.
−Removed: During 2023, the fluctuation in foreign currency exchange rates impacted our total revenue and our income from operations by insignificant amounts.
+Added: During 2024, the fluctuation in foreign currency exchange rates increased our total revenue and our income from operations by $3.0 million and $1.1 million, respectively.
We have entered into foreign currency forward contracts to hedge revenues denominated in the Canadian dollar against changes in the exchange rate with the U.S.
83 unchanged sentences
When measuring impairment of an asset or asset group using discounted cash flows, we make assumptions and apply judgment in estimating future cash flows and asset or asset group fair values, including annual revenue growth rates, a terminal year growth rate and selecting a discount rate that reflects the risk inherent in future cash flows.
−Removed: During 2023, we recorded immaterial noncash impairment charges against certain operating lease ROU assets and certain property and equipment assets.
−Removed: For additional information, see Notes 7 and 11 to our consolidated financial statements in this report.
+Added: During 2024, we recorded material noncash impairment charges against our EVERFI asset group, which primarily included finite-lived intangible assets and capitalized software and content development costs.
+Added: For additional information, see Note 4 to our consolidated financial statements in this report.
We do not believe there is a reasonable likelihood that there will be a material change in the future estimates or assumptions we use to assess impairment losses.
24 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.