Blackbaud Announces 2021 Third Quarter Results
"Third quarter results reflected a fantastic quarter of execution for Blackbaud, exceeding our expectations on a much-improved market backdrop," said
Third Quarter 2021 Results Compared to Third Quarter 2020 Results:
- Total GAAP revenue was
$231.2 million , up 7.5%, with$218.5 million in GAAP recurring revenue, up 9.2%. - Non-GAAP organic recurring revenue increased 9.2%.
- GAAP income from operations was
$11.8 million , with GAAP operating margin of 5.1%, an increase of 40 basis points. - Non-GAAP income from operations was
$50.5 million , with non-GAAP operating margin of 21.8%, a decrease of 60 basis points. - GAAP net income was
$6.2 million , with GAAP diluted earnings per share of$0.13 , up$0.03 per share. - Non-GAAP net income was
$37.9 million , with non-GAAP diluted earnings per share of$0.78 , up$0.05 per share. - Non-GAAP adjusted EBITDA was
$62.4 million , up$3.0 million , with non-GAAP adjusted EBITDA margin of 27.0%. - GAAP net cash provided by operating activities was
$69.9 million , a decrease of$1.8 million . - Non-GAAP free cash flow was
$57.9 million , an increase of$16.5 million .
"We expected an acceleration of revenue performance in the second half of 2021, and Q3 not only delivered, but exceeded that expectation, serving as a proof point for what's achievable as we progress against the growth and margin initiatives laid out at our investor session earlier this year," said
An explanation of all non-GAAP financial measures referenced in this press release is included below under the heading "Non-GAAP Financial Measures." A reconciliation of the company's non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release.
Recent Company Highlights:
- During the third quarter, Blackbaud repurchased 583,280 shares of its common stock at a total cost of
$40.3 million , leaving approximately$111 million remaining under existing share repurchase authorization of$250 million . - For the 22nd year, Blackbaud rallied tens of thousands of social good professionals at bbcon 2021 Virtual, the company's annual tech conference for a better world. Blackbaud announced high-impact product enhancements and provided hundreds of hours of free, best-practice content and inspiration.
- Blackbaud was featured in Microsoft's #BuildFor2030 campaign as a company accelerating nonprofits' missions and impact.
- In October, Blackbaud hosted its semi-annual Product Update Briefings, sharing details on innovation, new features and product roadmaps.
- The company shared details on its remote-first workforce approach, which enables Blackbaud to focus on hiring talent and growing careers, regardless of location.
- Blackbaud was named a finalist in the
U.S. Chamber of Commerce Foundation's Citizens Awards—a long-standing program that honors businesses for the impact they make in communities around the world.
Visit www.blackbaud.com/newsroom for more information about Blackbaud's recent highlights.
Conference Call Details:
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What: |
Blackbaud's 2021 Third Quarter Conference Call |
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When: |
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Time: |
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Live Call: |
1-877-407-3088 (US/ |
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Webcast: |
About Blackbaud
Blackbaud (NASDAQ: BLKB) is the world's leading cloud software company powering social good. Serving the entire social good community—nonprofits, higher education institutions, K–12 schools, healthcare organizations, faith communities, arts and cultural organizations, foundations, companies and individual change agents—Blackbaud connects and empowers organizations to increase their impact through cloud software, services, expertise and data intelligence. The Blackbaud portfolio is tailored to the unique needs of vertical markets, with solutions for fundraising and CRM, marketing, advocacy, peer-to-peer fundraising, corporate social responsibility, school management, ticketing, grantmaking, financial management, payment processing and analytics. Serving the industry for four decades, Blackbaud is headquartered in
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Investor Contact: |
Media Contact: |
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Director, Investor Relations |
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Forward-Looking Statements
Except for historical information, all of the statements, expectations, and assumptions contained in this news release are forward-looking statements which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding the predictability of our financial condition and results of operations. These statements involve a number of risks and uncertainties. Although Blackbaud attempts to be accurate in making these forward-looking statements, it is possible that future circumstances might differ from the assumptions on which such statements are based. In addition, other important factors that could cause results to differ materially include the following: management of integration of acquired companies; uncertainty regarding increased business and renewals from existing customers; a shifting revenue mix that may impact gross margin; continued success in sales growth; cybersecurity and data protection risks and related liabilities; uncertainty regarding the COVID-19 disruption; potential litigation involving us; and the other risk factors set forth from time to time in the
Trademarks
All Blackbaud product names appearing herein are trademarks or registered trademarks of
Non-GAAP Financial Measures
Blackbaud has provided in this release financial information that has not been prepared in accordance with GAAP. Blackbaud uses non-GAAP financial measures internally in analyzing its operational performance. Accordingly, Blackbaud believes these non-GAAP measures are useful to investors, as a supplement to GAAP measures, in evaluating its ongoing operational performance and trends and in comparing its financial results from period-to-period with other companies in Blackbaud's industry, many of which present similar non-GAAP financial measures to investors. However, these non-GAAP financial measures may not be completely comparable to similarly titled measures of other companies due to potential differences in the exact method of calculation between companies.
The non-GAAP financial measures discussed above exclude the impact of certain transactions that Blackbaud believes are not directly related to its operating performance in any particular period, but are for its long-term benefit over multiple periods. Blackbaud believes these non-GAAP financial measures reflect its ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of trends in its business.
While Blackbaud believes these non-GAAP measures provide useful supplemental information, non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliations of these non-GAAP measures to their most directly comparable GAAP financial measures.
Non-GAAP free cash flow is defined as operating cash flow less capital expenditures, including costs required to be capitalized for software development, and capital expenditures for property and equipment.
In addition, Blackbaud uses non-GAAP organic revenue growth, non-GAAP organic revenue growth on a constant currency basis and non-GAAP organic recurring revenue growth, in analyzing its operating performance. Blackbaud believes that these non-GAAP measures are useful to investors, as a supplement to GAAP measures, for evaluating the periodic growth of its business on a consistent basis. Each of these measures excludes incremental acquisition-related revenue attributable to companies acquired in the current fiscal year. For companies acquired in the immediately preceding fiscal year, each of these measures reflects presentation of full-year incremental non-GAAP revenue derived from such companies as if they were combined throughout the prior period, and it includes the non-GAAP revenue attributable to those companies, as if there were no acquisition-related write-downs of acquired deferred revenue to fair value as required by GAAP. In addition, each of these measures excludes prior period revenue associated with divested businesses. The exclusion of the prior period revenue is to present the results of the divested businesses within the results of the combined company for the same period of time in both the prior and current periods. Blackbaud believes this presentation provides a more comparable representation of its current business' organic revenue growth and revenue run-rate.
Rule of 40 is defined 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; income tax provision; depreciation; amortization of intangible assets from business combinations; amortization of software development costs; acquisition-related deferred revenue write-down; stock-based compensation; acquisition-related integration costs; acquisition-related expenses; employee severance; restructuring and other real estate activities; and costs, net of insurance, related to the previously disclosed security incident discovered in
|
(dollars in thousands) |
|
|
||||
|
Assets |
||||||
|
Current assets: |
||||||
|
Cash and cash equivalents |
$ |
27,591 |
$ |
35,750 |
||
|
Restricted cash |
216,122 |
609,219 |
||||
|
Accounts receivable, net of allowance of |
105,873 |
95,404 |
||||
|
Customer funds receivable |
6,076 |
321 |
||||
|
Prepaid expenses and other current assets |
102,319 |
78,366 |
||||
|
Total current assets |
457,981 |
819,060 |
||||
|
Property and equipment, net |
103,346 |
105,177 |
||||
|
Operating lease right-of-use assets |
19,652 |
22,671 |
||||
|
Software development costs, net |
118,860 |
111,827 |
||||
|
|
635,912 |
635,854 |
||||
|
Intangible assets, net |
249,494 |
277,506 |
||||
|
Other assets |
69,699 |
72,639 |
||||
|
Total assets |
$ |
1,654,944 |
$ |
2,044,734 |
||
|
Liabilities and stockholders' equity |
||||||
|
Current liabilities: |
||||||
|
Trade accounts payable |
$ |
38,388 |
$ |
27,836 |
||
|
Accrued expenses and other current liabilities |
58,579 |
52,228 |
||||
|
Due to customers |
220,785 |
608,264 |
||||
|
Debt, current portion |
12,948 |
12,840 |
||||
|
Deferred revenue, current portion |
329,426 |
312,236 |
||||
|
Total current liabilities |
660,126 |
1,013,404 |
||||
|
Debt, net of current portion |
514,418 |
518,193 |
||||
|
Deferred tax liability |
56,144 |
54,086 |
||||
|
Deferred revenue, net of current portion |
4,528 |
4,678 |
||||
|
Operating lease liabilities, net of current portion |
13,470 |
17,357 |
||||
|
Other liabilities |
9,421 |
10,866 |
||||
|
Total liabilities |
1,258,107 |
1,618,584 |
||||
|
Commitments and contingencies |
||||||
|
Stockholders' equity: |
||||||
|
Preferred stock; 20,000,000 shares authorized, none outstanding |
— |
— |
||||
|
Common stock, |
62 |
61 |
||||
|
Additional paid-in capital |
634,406 |
544,963 |
||||
|
|
(490,456) |
(353,091) |
||||
|
Accumulated other comprehensive income (loss) |
3,319 |
(2,497) |
||||
|
Retained earnings |
249,506 |
236,714 |
||||
|
Total stockholders' equity |
396,837 |
426,150 |
||||
|
Total liabilities and stockholders' equity |
$ |
1,654,944 |
$ |
2,044,734 |
||
|
(dollars in thousands, except per share amounts) |
Three months ended |
Nine months ended |
|||||||||||
|
2021 |
2020 |
2021 |
2020 |
||||||||||
|
Revenue |
|||||||||||||
|
Recurring |
$ |
218,530 |
$ |
200,102 |
$ |
642,266 |
$ |
621,229 |
|||||
|
One-time services and other |
12,688 |
14,899 |
37,583 |
49,384 |
|||||||||
|
Total revenue |
231,218 |
215,001 |
679,849 |
670,613 |
|||||||||
|
Cost of revenue |
|||||||||||||
|
Cost of recurring |
95,823 |
84,251 |
279,123 |
265,172 |
|||||||||
|
Cost of one-time services and other |
11,858 |
14,434 |
40,013 |
43,317 |
|||||||||
|
Total cost of revenue |
107,681 |
98,685 |
319,136 |
308,489 |
|||||||||
|
Gross profit |
123,537 |
116,316 |
360,713 |
362,124 |
|||||||||
|
Operating expenses |
|||||||||||||
|
Sales, marketing and customer success |
44,703 |
48,460 |
138,948 |
159,149 |
|||||||||
|
Research and development |
31,566 |
22,783 |
90,967 |
72,655 |
|||||||||
|
General and administrative |
34,733 |
34,132 |
97,328 |
89,829 |
|||||||||
|
Amortization |
558 |
749 |
1,674 |
2,219 |
|||||||||
|
Restructuring |
131 |
105 |
263 |
179 |
|||||||||
|
Total operating expenses |
111,691 |
106,229 |
329,180 |
324,031 |
|||||||||
|
Income from operations |
11,846 |
10,087 |
31,533 |
38,093 |
|||||||||
|
Interest expense |
(4,003) |
(3,997) |
(14,171) |
(12,049) |
|||||||||
|
Other income, net |
862 |
542 |
339 |
2,242 |
|||||||||
|
Income before provision for income taxes |
8,705 |
6,632 |
17,701 |
28,286 |
|||||||||
|
Income tax provision |
2,517 |
1,756 |
4,946 |
6,948 |
|||||||||
|
Net income |
$ |
6,188 |
$ |
4,876 |
$ |
12,755 |
$ |
21,338 |
|||||
|
Earnings per share |
|||||||||||||
|
Basic |
$ |
0.13 |
$ |
0.10 |
$ |
0.27 |
$ |
0.44 |
|||||
|
Diluted |
$ |
0.13 |
$ |
0.10 |
$ |
0.26 |
$ |
0.44 |
|||||
|
Common shares and equivalents outstanding |
|||||||||||||
|
Basic weighted average shares |
47,542,746 |
48,271,139 |
47,554,746 |
48,182,799 |
|||||||||
|
Diluted weighted average shares |
48,274,072 |
48,859,707 |
48,259,956 |
48,582,068 |
|||||||||
|
Other comprehensive (loss) income |
|||||||||||||
|
Foreign currency translation adjustment |
(3,234) |
4,661 |
1,060 |
(1,954) |
|||||||||
|
Unrealized gain (loss) on derivative instruments, net of tax |
262 |
943 |
4,756 |
(1,628) |
|||||||||
|
Total other comprehensive (loss) income |
(2,972) |
5,604 |
5,816 |
(3,582) |
|||||||||
|
Comprehensive income |
$ |
3,216 |
$ |
10,480 |
$ |
18,571 |
$ |
17,756 |
|||||
|
Nine months ended |
||||||
|
(dollars in thousands) |
2021 |
2020 |
||||
|
Cash flows from operating activities |
||||||
|
Net income |
$ |
12,755 |
$ |
21,338 |
||
|
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||
|
Depreciation and amortization |
60,484 |
68,755 |
||||
|
Provision for credit losses and sales returns |
7,992 |
10,156 |
||||
|
Stock-based compensation expense |
89,480 |
54,556 |
||||
|
Deferred taxes |
400 |
1,879 |
||||
|
Amortization of deferred financing costs and discount |
1,234 |
569 |
||||
|
Other non-cash adjustments |
(527) |
2,203 |
||||
|
Changes in operating assets and liabilities, net of acquisition and disposal of businesses: |
||||||
|
Accounts receivable |
(18,779) |
(18,319) |
||||
|
Prepaid expenses and other assets |
(14,169) |
4,292 |
||||
|
Trade accounts payable |
10,728 |
(17,203) |
||||
|
Accrued expenses and other liabilities |
2,790 |
(31,595) |
||||
|
Deferred revenue |
17,400 |
12,534 |
||||
|
Net cash provided by operating activities |
169,788 |
109,165 |
||||
|
Cash flows from investing activities |
||||||
|
Purchase of property and equipment |
(8,332) |
(25,836) |
||||
|
Capitalized software development costs |
(29,661) |
(32,028) |
||||
|
Net cash used in investing activities |
(37,993) |
(57,864) |
||||
|
Cash flows from financing activities |
||||||
|
Proceeds from issuance of debt |
128,300 |
267,400 |
||||
|
Payments on debt |
(131,272) |
(290,999) |
||||
|
Debt issuance costs |
— |
(593) |
||||
|
Employee taxes paid for withheld shares upon equity award settlement |
(39,012) |
(21,286) |
||||
|
Proceeds from exercise of stock options |
— |
4 |
||||
|
Change in due to customers |
(386,973) |
(337,821) |
||||
|
Change in customer funds receivable |
(5,838) |
(4,495) |
||||
|
Purchase of treasury stock |
(98,353) |
— |
||||
|
Dividend payments to stockholders |
— |
(5,960) |
||||
|
Net cash used in financing activities |
(533,148) |
(393,750) |
||||
|
Effect of exchange rate on cash, cash equivalents and restricted cash |
97 |
(623) |
||||
|
Net decrease in cash, cash equivalents and restricted cash |
(401,256) |
(343,072) |
||||
|
Cash, cash equivalents and restricted cash, beginning of period |
644,969 |
577,295 |
||||
|
Cash, cash equivalents and restricted cash, end of period |
$ |
243,713 |
$ |
234,223 |
||
The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown above in the consolidated statements of cash flows:
|
(dollars in thousands) |
|
|
||||
|
Cash and cash equivalents |
$ |
27,591 |
$ |
35,750 |
||
|
Restricted cash |
216,122 |
609,219 |
||||
|
Total cash, cash equivalents and restricted cash in the statement of cash flows |
$ |
243,713 |
$ |
644,969 |
||
|
(dollars in thousands, except per share amounts) |
Three months ended |
Nine months ended |
|||||||||||
|
2021 |
2020 |
2021 |
2020 |
||||||||||
|
GAAP Revenue |
$ |
231,218 |
$ |
215,001 |
$ |
679,849 |
$ |
670,613 |
|||||
|
GAAP gross profit |
$ |
123,537 |
$ |
116,316 |
$ |
360,713 |
$ |
362,124 |
|||||
|
GAAP gross margin |
53.4 |
% |
54.1 |
% |
53.1 |
% |
54.0 |
% |
|||||
|
Non-GAAP adjustments: |
|||||||||||||
|
Add: Stock-based compensation expense |
4,263 |
3,688 |
14,858 |
7,123 |
|||||||||
|
Add: Amortization of intangibles from business combinations |
8,595 |
9,219 |
26,603 |
29,835 |
|||||||||
|
Add: Employee severance |
14 |
— |
29 |
813 |
|||||||||
|
Subtotal |
12,872 |
12,907 |
41,490 |
37,771 |
|||||||||
|
Non-GAAP gross profit |
$ |
136,409 |
$ |
129,223 |
$ |
402,203 |
$ |
399,895 |
|||||
|
Non-GAAP gross margin |
59.0 |
% |
60.1 |
% |
59.2 |
% |
59.6 |
% |
|||||
|
GAAP income from operations |
$ |
11,846 |
$ |
10,087 |
$ |
31,533 |
$ |
38,093 |
|||||
|
GAAP operating margin |
5.1 |
% |
4.7 |
% |
4.6 |
% |
5.7 |
% |
|||||
|
Non-GAAP adjustments: |
|||||||||||||
|
Add: Stock-based compensation expense |
28,926 |
20,843 |
89,480 |
54,556 |
|||||||||
|
Add: Amortization of intangibles from business combinations |
9,153 |
9,968 |
28,277 |
32,054 |
|||||||||
|
Add: Employee severance |
68 |
232 |
1,510 |
4,593 |
|||||||||
|
Add: Acquisition-related integration costs |
(17) |
(15) |
(115) |
(118) |
|||||||||
|
Add: Acquisition-related expenses |
67 |
64 |
196 |
288 |
|||||||||
|
Add: Restructuring and other real estate activities |
(420) |
6,943 |
(413) |
7,017 |
|||||||||
|
Add: Security Incident-related costs, net of insurance(1) |
851 |
— |
1,321 |
— |
|||||||||
|
Subtotal |
38,628 |
38,035 |
120,256 |
98,390 |
|||||||||
|
Non-GAAP income from operations |
$ |
50,474 |
$ |
48,122 |
$ |
151,789 |
$ |
136,483 |
|||||
|
Non-GAAP operating margin |
21.8 |
% |
22.4 |
% |
22.3 |
% |
20.4 |
% |
|||||
|
GAAP income before provision for income taxes |
$ |
8,705 |
$ |
6,632 |
$ |
17,701 |
$ |
28,286 |
|||||
|
GAAP net income |
$ |
6,188 |
$ |
4,876 |
$ |
12,755 |
$ |
21,338 |
|||||
|
Shares used in computing GAAP diluted earnings per share |
48,274,072 |
48,859,707 |
48,259,956 |
48,582,068 |
|||||||||
|
GAAP diluted earnings per share |
$ |
0.13 |
$ |
0.10 |
$ |
0.26 |
$ |
0.44 |
|||||
|
Non-GAAP adjustments: |
|||||||||||||
|
Add: GAAP income tax provision |
2,517 |
1,756 |
4,946 |
6,948 |
|||||||||
|
Add: Total non-GAAP adjustments affecting income from operations |
38,628 |
38,035 |
120,256 |
98,390 |
|||||||||
|
Non-GAAP income before provision for income taxes |
47,333 |
44,667 |
137,957 |
126,676 |
|||||||||
|
Assumed non-GAAP income tax provision(2) |
9,467 |
8,933 |
27,592 |
25,335 |
|||||||||
|
Non-GAAP net income |
$ |
37,866 |
$ |
35,734 |
$ |
110,365 |
$ |
101,341 |
|||||
|
Shares used in computing non-GAAP diluted earnings per share |
48,274,072 |
48,859,707 |
48,259,956 |
48,582,068 |
|||||||||
|
Non-GAAP diluted earnings per share |
$ |
0.78 |
$ |
0.73 |
$ |
2.29 |
$ |
2.09 |
|||||
|
(1) |
Includes Security Incident-related costs incurred during the three and nine months ended |
|||||||||||||
|
(2) |
Blackbaud applies a non-GAAP effective tax rate of 20.0% when calculating non-GAAP net income and non-GAAP diluted earnings per share. |
|||||||||||||
|
(dollars in thousands) |
Three months ended |
Nine months ended |
|||||||||||
|
2021 |
2020 |
2021 |
2020 |
||||||||||
|
GAAP revenue |
$ |
231,218 |
$ |
215,001 |
$ |
679,849 |
$ |
670,613 |
|||||
|
GAAP revenue growth |
7.5 |
% |
1.4 |
% |
|||||||||
|
Add: Non-GAAP acquisition-related revenue(1) |
— |
— |
— |
— |
|||||||||
|
Non-GAAP organic revenue(2) |
$ |
231,218 |
$ |
215,001 |
$ |
679,849 |
$ |
670,613 |
|||||
|
Non-GAAP organic revenue growth |
7.5 |
% |
1.4 |
% |
|||||||||
|
Non-GAAP organic revenue(2) |
$ |
231,218 |
$ |
215,001 |
$ |
679,849 |
$ |
670,613 |
|||||
|
Foreign currency impact on non-GAAP organic revenue(3) |
(2,049) |
— |
(8,392) |
— |
|||||||||
|
Non-GAAP organic revenue on constant currency basis(3) |
$ |
229,169 |
$ |
215,001 |
$ |
671,457 |
$ |
670,613 |
|||||
|
Non-GAAP organic revenue growth on constant currency basis |
6.6 |
% |
0.1 |
% |
|||||||||
|
GAAP recurring revenue |
$ |
218,530 |
$ |
200,102 |
$ |
642,266 |
$ |
621,229 |
|||||
|
GAAP recurring revenue growth |
9.2 |
% |
3.4 |
% |
|||||||||
|
Add: Non-GAAP acquisition-related revenue(1) |
— |
— |
— |
— |
|||||||||
|
Non-GAAP organic recurring revenue |
$ |
218,530 |
$ |
200,102 |
$ |
642,266 |
$ |
621,229 |
|||||
|
Non-GAAP organic recurring revenue growth |
9.2 |
% |
3.4 |
% |
|||||||||
|
(1) |
Non-GAAP acquisition-related revenue excludes incremental acquisition-related revenue calculated in accordance with GAAP that is attributable to companies acquired in the current fiscal year. For companies acquired in the immediately preceding fiscal year, non-GAAP acquisition-related revenue reflects presentation of full-year incremental non-GAAP revenue derived from such companies, as if they were combined throughout the prior period, and it includes the non-GAAP revenue from the acquisition-related deferred revenue write-down attributable to those companies. |
|||||||||||||
|
(2) |
Non-GAAP organic revenue for the prior year periods presented herein may not agree to non-GAAP organic revenue presented in the respective prior period quarterly financial information solely due to the manner in which non-GAAP organic revenue growth is calculated. |
|||||||||||||
|
(3) |
To determine non-GAAP organic revenue growth on a constant currency basis, revenues from entities reporting in foreign currencies were translated to |
|||||||||||||
|
(dollars in thousands) |
Three months ended |
Nine months ended |
|||||||||||
|
2021 |
2020 |
2021 |
2020 |
||||||||||
|
GAAP net income |
$ |
6,188 |
$ |
4,876 |
$ |
12,755 |
$ |
21,338 |
|||||
|
Non-GAAP adjustments: |
|||||||||||||
|
Add: Interest, net |
3,921 |
3,230 |
13,860 |
10,650 |
|||||||||
|
Add: GAAP income tax provision |
2,517 |
1,756 |
4,946 |
6,948 |
|||||||||
|
Add: Depreciation |
3,135 |
3,722 |
9,486 |
10,858 |
|||||||||
|
Add: Amortization of intangibles from business combinations |
9,153 |
9,968 |
28,277 |
32,054 |
|||||||||
|
Add: Amortization of software development costs(1) |
7,986 |
7,789 |
24,068 |
24,828 |
|||||||||
|
Subtotal |
26,712 |
26,465 |
80,637 |
85,338 |
|||||||||
|
Non-GAAP EBITDA |
$ |
32,900 |
$ |
31,341 |
$ |
93,392 |
$ |
106,676 |
|||||
|
Non-GAAP EBITDA margin |
14.2 |
% |
13.7 |
% |
|||||||||
|
Non-GAAP adjustments: |
|||||||||||||
|
Add: Stock-based compensation expense |
28,926 |
20,843 |
89,480 |
54,556 |
|||||||||
|
Add: Employee severance |
68 |
232 |
1,510 |
4,593 |
|||||||||
|
Add: Acquisition-related integration costs |
(17) |
(15) |
(115) |
(118) |
|||||||||
|
Add: Acquisition-related expenses |
67 |
64 |
196 |
288 |
|||||||||
|
Add: Restructuring and other real estate activities |
(420) |
6,943 |
(413) |
7,017 |
|||||||||
|
Add: Security Incident-related costs, net of insurance(2) |
851 |
— |
1,321 |
— |
|||||||||
|
Subtotal |
29,475 |
28,067 |
91,979 |
66,336 |
|||||||||
|
Non-GAAP Adjusted EBITDA |
$ |
62,375 |
$ |
59,408 |
$ |
185,371 |
$ |
173,012 |
|||||
|
Non-GAAP Adjusted EBITDA margin |
27.0 |
% |
27.3 |
% |
|||||||||
|
Rule of 40(3) |
34.5 |
% |
28.7 |
% |
|||||||||
|
(1) |
Includes amortization expense related to software development costs and amortization expense from capitalized cloud computing implementation costs. |
|||||||||||||
|
(2) |
Includes Security Incident-related costs incurred, net of probable insurance recoveries. See additional details in the reconciliation of GAAP to Non-GAAP operating income above. |
|||||||||||||
|
(3) |
Measured by non-GAAP organic revenue growth plus non-GAAP adjusted EBITDA margin. See Non-GAAP organic revenue growth table above. |
|||||||||||||
|
(dollars in thousands) |
Nine months ended |
|||||
|
2021 |
2020 |
|||||
|
GAAP net cash provided by operating activities |
$ |
169,788 |
$ |
109,165 |
||
|
Less: purchase of property and equipment |
(8,332) |
(25,836) |
||||
|
Less: capitalized software development costs |
(29,661) |
(32,028) |
||||
|
Non-GAAP free cash flow |
$ |
131,795 |
$ |
51,301 |
||
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