Blackbaud, Inc. (NASDAQ:BLKB) Q3 2022 Results Conference Call November 2, 2022 8:00 AM ET

Company Participants

Steve Hufford - Director, Investor Relations

Mike Gianoni - President and CEO

Tony Boor - Executive Vice President and CFO

Conference Call Participants

Jeffrey Lane - Stifel

Matt VanVliet - BTIG

Peter Burkly - Evercore ISI

Brian Peterson - Raymond James

Patrick Schulz - Baird

Operator

Good day, and welcome to Blackbaud's Q3 2022 Earnings Call. Today's conference is being recorded. I'll now turn the conference over to Steve Hufford. Please go ahead, sir.

Steve Hufford

Good morning, everyone. Thank you for joining us on Blackbaud's Third Quarter 2022 Earnings Call. Joining me on the call today are Mike Gianoni, Blackbaud's President and CEO; and Tony Boor, Blackbaud's Executive Vice President and CFO. Mike and Tony will make prepared comments, and then we will open up the line for your questions.

Please note that our comments today contain forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially from those projected. Please refer to our most recent Form 10-K and other SEC filings for more information on those risks.

We believe that a combination of both GAAP and non-GAAP measures are more representative of how we internally measure our business. Unless otherwise specified, we will refer only to non-GAAP measures on this call.

Please note that non-GAAP financial measures should not be considered in isolation from or as a substitution for GAAP measures. A reconciliation of GAAP and non-GAAP results is available in the press release we issued last night, and a more detailed supplemental schedule is available in our presentation on our Investor Relations website. With that, I'll turn the call over to you, Mike.

Mike Gianoni

Thanks, Steve. Good morning, everyone, and thank you for joining us on the call today. I'll open the call by saying we had a very strong quarter. We now expect to meet or exceed our financial guidance for the year which increases our 28% Rule of 40 performance expectation to roughly 29% on a constant currency basis. And next year, we anticipate a step-level acceleration in Rule of 40 performance into the mid-30s based on actions we've already taken and initiatives in place to drive both growth and profitability.

Turning to the quarter. We had total revenue growth of 13%, and our organic recurring revenue at constant currency continues to trend consistently in the mid-single digits, growing 5% in the quarter. Year-to-date, our organic revenue growth at constant currency also stands at roughly 5%, and our adjusted EBITDA margin was roughly 25% at constant currency. Combined, we've achieved 30% on Rule of 40 through the first 3 quarters of the year, which leaves us very well positioned with only 1 quarter to go in the year.