CHARLESTON, S.C. - Blackbaud , Inc. (NASDAQ: NASDAQ:BLKB), a software company focused on social impact with a market capitalization of $3.67 billion, has completed the sale of its EVERFI Inc. business to an undisclosed private investment firm as of December 31, 2024. According to InvestingPro analysis, the company currently shows upside potential based on its Fair Value assessment. The transaction was described as being for a nominal amount, and further details are expected to be disclosed in the company’s forthcoming Form 10-K filing.
The sale comes after a strategic review process by Blackbaud, which generated $1.15 billion in revenue over the last twelve months with a healthy gross profit margin of 55.2%. Dale Strange, the company’s president of corporate impact, emphasized the commitment to a smooth transition for EVERFI’s customers and staff. "EVERFI remains well equipped to support its customers, delivering educational courses on key topics like financial literacy, wellness, compliance and workplace training," Strange stated.
Blackbaud, which continues to serve nonprofit and education sectors, as well as companies and individuals committed to social responsibility, will retain its YourCause® portfolio and Impact Edgeä solution. These services, which facilitate corporate giving, volunteering, and engagement, are integral to Blackbaud’s strategy for enabling companies to advance their corporate impact initiatives.
The company, recognized for its contributions to social impact, has been named to prestigious lists such as America’s Most Responsible Companies by Newsweek and America’s Best Employers by Forbes. Blackbaud operates in a remote-first capacity with a presence in multiple countries, supporting users worldwide. InvestingPro analysis reveals several positive indicators, including expected net income growth this year and aggressive share buybacks by management. For deeper insights and access to 10+ additional ProTips, along with comprehensive financial analysis, investors can explore the detailed Pro Research Report available on InvestingPro.
The sale of EVERFI aligns with Blackbaud’s focus on its core offerings and strategic direction. The financial terms and the identity of the private investment firm have not been disclosed. This news is based on a press release statement from Blackbaud.
In other recent news, Blackbaud, a cloud software company, has announced a noncash impairment charge of approximately $415 million for its EVERFI asset group due to its underperformance. In response to this, the company is considering various alternatives, including a potential sale of the business. Despite the downward revision of earnings expectations by four analysts, net income growth is still anticipated for the year.
Blackbaud has also reported a 6.6% increase in overall revenue and a 6.8% rise in contractual recurring revenue in its Third Quarter 2024 Earnings Conference Call, primarily driven by its Social Sector. However, due to a 26% drop in revenue from its EVERFI segment, Blackbaud has revised its annual revenue guidance to $1.150 billion to $1.160 billion. The company also predicts an adjusted EBITDA margin within the ranges of 33% to 34% and non-GAAP earnings per share between $3.98 to $4.16.
Analysts at Baird have updated their outlook for Blackbaud, downgrading the stock from Outperform to Neutral and reducing the price target to $80 from the previous $92, influenced by a general reset in growth expectations and a revised outlook for Blackbaud’s core Social Sector.
Blackbaud plans to spin out the underperforming EVERFI segment, with Goldman Sachs advising on strategic options. The company also continues its stock repurchase strategy, aiming to buy back up to 10% of its common stock by year-end. In addition, Blackbaud has appointed a former US Cyber Command chief to its board, a move expected to strengthen the company’s cybersecurity practices. These are the recent developments in Blackbaud’s operations.
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