Blackbaud (BLKB) 3 Aug 222022 Q2 Earnings call transcript

Good day, and welcome to Blackbaud's Q2 2022 Earnings Call. Today's conference is being recorded. I'll now turn the conference over to Steve Hufford. Please go ahead, sir.

Good morning, everyone. us second joining call. XXXX for you on quarter Blackbaud's earnings Thank

more results President our and a otherwise me combination measures are considered and projected. for on Tony non-GAAP questions. forward-looking CEO; Vice representative as business. measure GAAP and should today or we we we the and specified, this substitution for then available filings and Investor last that Boor, uncertainties recent cause Please be We actual CFO. Gianoni, of the Executive our Joining up Please call your our and XX-K to Unless we our Mike Relations internally call. press risks will both that how GAAP on schedule available presentation those non-GAAP believe on reconciliation the from are to to prepared financial comments will to refer statements today Tony make other materially Blackbaud's not open President Blackbaud's subject measures note results non-GAAP for website. and of only in comments, Mike a most on will note measures isolation Please and in measures. is night, is a of issued line detailed and contain release Form and more that refer our supplemental differ in those from GAAP could more A SEC information risks. non-GAAP that

Internet August XX. Conference the be the August attending IDEAS over & I'll Technology, during mention team Mike, briefly on will to quarter, Before the Oppenheimer on Midwest third XX, Conference Communications call I turn and that the our

investor participating on we in by meetings addition, Baird In be hosted will XX. August virtual

like during to call to a we're quarter. you'd Mike. that, I'll ir@blackbaud.com, the you, also available the over turn With connect reminder, if As at

call Thank joining for us you, the everyone. morning, Good on Steve. today. Thank you

quarter, factors X the for half view briefly the highlights impacts the against and outlook this address of and to how business turn I'd I current year. macro like economic and operational second for the positioning Before our Blackbaud's the the landscape to on

First, and in environment, We've clearly destination. attract competitive hiring and to attracting, talent. few remain over openings. focused we a retaining capabilities We our hire a a enhanced XXX,XXX we and have remain hundred consistently applicants for on job sought-out top

we have plans environment, macro and our back in the hiring staff Given area. have our cut one-time services reduced revenue

raise leveraging exposure downside Ukraine. by the digital no affected conflict to funds for are organizations technology Humanitarian has Blackbaud supporters conflict. engage Second, our in those and the to

rate entering XXXX terms of prudent that and environment, took a in past of and environment our the exposure recession, the rates. to our Third, impact rising at interest I'll on markets and debt refinance look the the to Fourth, to of topic low the been inflation back has interest in interest rate technical company of you we hedge the some in recessions minimal. impact advantage our remind we on rising step took and

and our and long-term currency time a market, grow big strong philanthropy larger much example, to from on fifth, footprint. XXXX total the a was well. of our and built consistent end given our And and company And business smaller of with little resiliency balancing exposure strategy to international revenue fared revenue with during much For thoughtful at XX% to profitability. base. stand of track through of We roughly we markets The the limited looking sustainable percentage continued has impact size a a past at our pandemic, Today, mindset timeframe our approach our the when perspective, a a revenue of execution the to ring at the Blackbaud's remain reoccurring record test long-term for in our been is pretty broader growth reoccurring XXXX was revenue. there recessions.

forward guidance revising account which we in half more outlook the Tony for and second our the slightly will are detail. expect impact to cover of year, However, in that the we

Now X%, of above business XX.X% second margin our which constant the XX half roughly the full high the at to a for our business the paced EBITDA year, of our was strong performed total of full at results. the quarter of a continued XX% paced guidance achieved internal year-to-date, XX% extremely In guidance end revenues. first reoccurring sits our revenue had growth in year grew to half original on our transactional revenue of our to of of full out reoccurring stands We XX.X%. of organic at largely and original expectation XX% short, EVERFI, planning. the our revenues currency, we which In organic We QX, which growth ahead which the the our first driven and of by year, of the had Through half XX%, midpoint close year. the inclusive first contractual range year. in adjusted reoccurring X%, year growth revenue Rule was of and the well on

the Chief customers. our best-in-class delivering support Customer our and new to to appointed operating Kevin of on To start, announced operations and become as achieving Chief even the to Officer Singh functions recently consistency of a oversee Rule first strategic company's a organizational success approach our under also on more we to our position customer strategy executing as retention. functions central he of in progress to experience now shifting role will significant streamline serve the EVP our ensure to performance. from we named spanning and Officer, centric. Now Chris on focused business In We're for we this, of technology leader experience. updates Gregoire Operating into these driving a Bringing customer products customer improvements series focused and journey in one XX. I a

a and addition our to the new in go-to-market efforts to for Davidson, to global of responsibility our Benjamin the the being now impact. responsibilities of JustGiving. global for efforts This as as Markets appointed founder in EVERFI to the company. is and business on a further streamline EVERFI, choice Tom outcomes focused Group addition will to our and and responsibility to his investment our David will Chief executive EVP and simplify social EVERFI for maximize company's was Officer, International Next, have Also in who, YourCause sales reminder, role change align our CEO overseeing and of YourCause the continue offerings, partner corporations Commercial

exited our us significant first we data data move stable, to while who of our Airlines, all have continue reducing will brings Security still to moment center our deliver cybersecurity make customers for modernized Global in over our great addition I'd great to XX our more to currently and Finally, Also affordable a recent Board, third-party tech experience close secure, quarters. company. as to our and the Directors. to Deneen colo in President years cloud changes of second leadership Information to to and coming but operating really a quarter, environments. scheduled work infrastructure costs. cloud solutions the a accelerate do, of is of for We Vice we center, United progress in enables take Deneen, highlight to to lot Officer the DeFiore shift Chief appointment to with Blackbaud's like Board and we third-party This be

our by the reality. teams Lastly, the I'm driving as platform inspired SKY are become seen innovations we've a

announced Raiser's management to June, are connect track we transforming capacity, accomplish that solicitation. to customers accelerating related and automates Prospect results. a portfolio to offering and In and giving and donors NXT We prescribes our Edge by users and within how in-app Insights, new of the related major tool outcomes then their intelligence with improvements software and likelihood actions breakthrough launch

organizations increase empowers we held that giving experience prospects, fundraising improve major efficiencies Insight that of Blackbaud lowcode Nearly registered insights and code to with their more enabling lowcode in in third-party technologies. need X,XXX year-over-year, our annual consultants movement Blackbaud highlighting an XX% accessible and advantage over or June, SKY no conference, and customers, the developers are software. partners more growing left take For of feeling solutions. within conference usage developer our offers now to With even to Prospect customers program, in in XX% than we of multidimensional technology. existing Also attendees the actions prioritize

Startup K-XX last content, well conference, educators, brought Another are of just we engaging with way school than which together supports evolving on solving within the social collaborate EVERFI leader the position a is their continues Good Blackbaud working good strategies responsibility software continue in as to through continue month, additional to an corporate We're last to ESG from Program, X to our excited that K-XX sessions as start-ups. early-stage and experts our problems welcomed outcomes-based to education private design grounded for weeks, peers to to And a plan advance at companies, And expanding whole focused LearnOn on unique together X,XXX and rapidly Social in learning. child more which start innovative provides EVERFI's with sector goals these sector, efforts. public community. XXXX Blackbaud's launching which curated our cohort. supported X XXXX, ecosystem to their in as XX lastly, the innovation we hosted for brought forefront. Conference of And spaces, goods the we largely we in growth resources both we have to Since matter July a as our and the thousands be founders that addresses access companies social

Fortune taking efforts. second Atlanta half from bringing they to year, for year of XXXX partner this In of Impact in example, is first advance their be as XXXX. a For later look half which ESG outlook ESG the the outstanding EVERFI had prudent CSR the we've founding approach together will and of summary, an the are and to held Fortune senior the initiative, leaders

are a space. We in uniquely as our market leader positioned

underway as macro remain our environment core sustainable continue incremental as strategic in balance look to confident to well operating monitor we discipline and with our already program We the investments to ability initiatives execute on growth. drive as to business

the rates, unfavorable the revenue our foreign original and fall our aside from exchange year, within to Looking to in guidance profitability movement would rest outlook of ranges.

we the is accelerated it Q&A. margin over before expansion several the operational sound, meaningful for open turn Tony? over up we're growth that, to I'll drive confident to Blackbaud's next and With years. Our Tony positioning execution and call in

details Thanks, Mike. full outlook press results and Today, investor We 'XX. of line the posted we had year materials our opening XXXX our another of the head review and well morning, refer Please full before questions. quarter back for us up Good QX that for strong to half website the as XXXX cover quarter the positions for financial yesterday's everyone. the second our performance. to our for into I'll release

million, continued representing growth X% XX% versus $XXX improvements ahead was strength rep quarter. in with in for quarter be year on per Healthy initiatives. revenue and the prior million, more rates execute we productivity total revenue Organic Second driven renewal in sales revenue bright $X.X impacts adjusted revenues. growth foreign total currency by quarter of the multiyear was of when opportunity continue our spots recurring to as

million XXXX business and one-time quarter total contributed the once in basis other growth of our no pricing total on a and more payments partners. mix we donations Also quarter. decline other volumes along initiatives on EVERFI underway, XX a it's we introduce the shift for on shift provide of strong delivered to roughly revenue some work possible and and latest optionality first again revenue tailwind to a drag our it was to projections, growth Our the in expect services the revenue. of One-time the professional should continued point bond longer and Based $XX mix significant for increasing payments as services could the in from services towards the multiyear roughly million revenue $XX further online drag revenue half. with

to Moving earnings.

per an gross million, Our of EBITDA second margin adjusted and was diluted margin $XX we've quarter $X.XX. of share XX.X% earnings EBITDA generated adjusted XX%, representing of

of reflects end of EBITDA margin this XX.X% was our is on will margin original at cloud I'm -- drivers infrastructure, to go-to-market expectation like the efficiencies growth continued expansion half first and synergies XX.X% significant key to progress XX% that our adjusted and pricing margin initiatives, going and high and EBITDA margin sorry, forward. EVERFI shift XX.X% integration Our drive third-party cost and up

drive operational high While proven we able manage record statement the have track to business. of the outlook, confidence we adjusted year to cash and and and in have flow balance brings me full being sheet. a costs our scale That

ended Our our flow adjusted was debt of quarter borrowing represented additional we the X.Xx, flow through debt-to-EBITDA ratio capacity. free XX%. in to million remainder quarter the net QX, with the Through cash million on adjusted of margin free approximately we've rapidly $XXX focused cash reduced $XX and an We an of deleveraging million with and remain in second $XXX 'XX.

market global sheet our environment, of the low took rate interest management to debt the reiterate current advantage at take the steps and in a important that environment position we flexibility. us pandemic to Given balance XXXX, the leave beginning financial strong the it's of with in refinance

Our rates interest somewhat of with at fixed exposure is rising insulated XX% debt rates of roughly through low hedged end to very the our XXXX.

our mix incremental for $X.XX in the reduced full like X% foreign first to for behind macroeconomic as $X.XX EVERFI. positive exchange drag We revenue the revenue. represents revenue, which Pound, away guidance of over can revenue movement continued with flat billion to range continued largely the remainder revenue shift account rates, as decline now year from which half of unforeseen evolving half vast $XX as of expect one-time the conditions revenue. nearly primarily our Roughly reduced billion. financial majority tied revenue to roughly services for With a one-time our is slightly on our which British to of drag year, projections Starting and overall the from continued unfavorable guidance attributed we've services our when our be unfavorable a long-term. movement normalizing us million associated in expected and us, updated by international other X/X total the shift range The one-time other one-time items the mix EVERFI. in with of well with sales such approximately We've to this full one-time the our services core revenue for acquisition is also roughly services decline represents in for revenue updated from FX to the

plan our impact the much Lastly, latest EVERFI, ratable full for the rest to has in revenues a XXXX lesser of bookings suggest which offsetting and softness some recognition minimal projections our given extent, year revenue in our on strength business.

the to We look ahead are bookings closing as on gap XXXX. intently focused we EVERFI

decline third seasonality quarterly services typical picking a slight of we sequential JustGiving in the expect the in revenue fourth before quarter. business, Given our up quarter total the in again in

is revenue framework. aligned growth of midpoint at with mid-single-digit guidance for long-term continues the constant Importantly, currency, our which our to call goal organic well

profitability. to Turning

guidance and range We excluding expectation original Our full of XX% year bringing roughly targeted XX.X%. to our is by impacts, to our points, XX was the profitability year XX.X% margin XX.X% adjusted in full for anticipate currency range to basis margin EBITDA revised adjusted unchanged. FX to reduce EBITDA

make and in create on infrastructure. scalability to to go-to-market our drive efficiencies continue products to additional We and efforts our in our progress

at constant the XXXX. we're Looking now Rule anticipate of for targeting improvement the roughly at in XX, XX% significant year currency, full we and

Moving to cash flow.

a range to of the Our to range largely in the And flow adjusted anticipated is expect $XXX $XXX X cash year. full cash We difference in free the million flow to original for guidance adjusted now attributable $XXX buckets. million. free million million of $XXX

represents first as control, half assumptions is over changes unforeseen tax interest unfavorable for higher expectations which and outside that to slightly are revision the The our cash FX mostly and such rates. of

second upfront. are attributed The to in the annually EVERFI of the billed is is bucket and which typically the bookings, lesser softness X

the excludes flow cash to adjusted previously net our related cash a litigation of securities. free our for As disclosed ongoing reminder, spent insurance reimbursements guidance to of be

way currency. quarter, spend. recent $XX expectation we revenue our on had related recurring us for the continue that to of XX of the perspective. like long-term XX% initiatives remain that to of towards us I'd and we of a We Rule value for Rule performance achieving your million growth legal operating capital In our strong our confident our growth core million summary, net margin With execution position up to to double-digit that, and positioned most total organic outlays a open on for remain allocating 'XX confident for we execute business a well the questions. plan to Our $XX both second posting program has revenue ongoing and shareholders. cash fees goal security growth, from that the Overall, of against in committed for constant ability remain continued progressing in and XX, well line achieved at maximizes a mid-single-digit incremental to

All question right. come with of [Operator Stifel. Our first from line Instructions] the Parker Lane

and evaluating customers the Curious, Or is occur exactly there? cause the softness and to started of if in it was sort execution for could when with for the the year? you Is an their remainder of some primarily EVERFI, of macro that situation? related, pinpoint from what integration budgets bookings

Sure. within our solid reminder, half really of fact well, guidance is we'd going reasons, big one-time, question. I'll EVERFI. due There EVERFI FX guidance change market. opportunity our have didn't and It's revenue. specific be that to growth impact, your still start $X EVERFI original Mike. with plan. is acquisition softness FX in this within about our we mostly first booking XX% the If is not revenue for range. EVERFI to some Also is their Quick million X of a is

but that and deals area. JPMorgan, Bank like remind with we the with in And some also in company we great And large than Third Fifth had had overperformed have like we have companies I'll currency for Truist, subscriptions. higher EVERFI, the Guardian in we this did still areas Life, second, example. like we you, First, Google, digital in we're transactions some space pushed. opportunities opportunities now other in and We sales very staffed. turnover, would

for opportunity big is us. ESG still a this So space really

you then some some or and for anything plans the year? the that you play Good in what staff you of where hiring is there And services. -- the to macro? be one-time But for the reduced else year it. are at reduced other uncertain response Got your areas know to just is may I said Or hear. there? And

Yes.

straightforward. So solutions. it's the is because been simply service required We've just hours for just managing our for pretty cost Parker, staff one-time years, there and less

is And area. back bit to reduce area. just backwards, one that kind really so just one-time has really across been of that's a No planned. we've been the no to continued and a general, revenue has for as cut while, which hiring be our specific gone cost ongoing on specific we In just board. conservative, but the It's --

in business. hire in lower going But some a we're hire We continue to the in general, rate. places to at

from line Next question Oliver Baird. the comes of Rob with

over I seem it for traction coming know to the start. you that I'm one your and Mike, initiatives of saw some to them prepared curious, in bringing guys get learnings, of over and pricing some transactional that just remarks, you U.S. the the in again them majority Europe talked And organic the and those here side. growth have of about does the referenced is you on you

I'm -- those bit we growth side? And little start about just understand a is on wondering, what's maybe would organic yet we happening? So software at see start might it to price the when that where and a to contribute to are point initiatives a point happen help us more

bet. you Yes,

to about multiple side, pricing as So on in transactional we we past Rob. do the have on initiatives the well, some software as talked side related the

the calendar the there implement. been future. growth Most are into And place. They the have of in to some still on put already

but and And some on we have in initiatives underway calendar future. change, many the to process take that some software related changes takes some the contractual changes,

year, next back more of So we'll to growth through year see well. some this as there start all half

some and for different can one X.X maybe can and just getting over That helpful. just to That's can data past how as products so sense -- of up that Great. on start cost left data so coming Tony, you that. colo you for question benefits would have I from pathway, times us wondering, the was extent a then, been closed. And of we you just Okay. see has to centers. felt But that congrats the colo years, I many like And time acquisitions, different the you know milestone That's a just to one that? many that because great centers line you. give the the at close? us And remind

at environments good. up as if Yes, out you the spending to and And up for the the we've colos it's for customers of time. running still that Rob, years, been added to not on and areas money migrate investments on the expense making old that security fronts some triple several we doubled and paying some in know colos, then plus same get cloud both

impact gross margins believe we a very first migrate So We out of we'll as positive those. have on closed do that we one.

be, able data smaller centers, will we'll term, be have colo We in the so close several nearer those. those to

years. will Those able next down a And think data So the actually to equipment and take to to fully, centers. centers shut have we data very down of over be those longer but X probably rigs couple will cetera. large X et we shut those and and of network gear, within consolidate

actively big don't get some stair we time. next they spending between those moved a we see as our also same today a we'll the bit fairly X So cloud improvement in as those know I step significant see years, at to margin customers environments, should security the X get data to of down are to back come improvement. we enhance gross cloud accelerate more shut of some trying environments. the footprint and do move centers to But over well over kind that And because the

savings a now offset, to quickly. unfortunately, some little more to there's the because So those trying bit we're of right accelerate moves of

is this just Mike. -- add. just I'll I'll Rob,

of AWS Azure. lot of primarily some the in like secondly, companies, and smaller So soon. centers close will we And are fairly data a

talk in EVERFI. so no there a EVERFI AWS about on colo environment already I footprint They're think us. And AWS. but pretty AWS, destination we have in for with drag big was Azure, a more we is

Appreciate Okay. That's helpful Good color. it. progress.

of with from ISI. comes question Evercore line Our the Materne next Kirk

start in the the of really been gone has obviously, Mike, year. first to good off half a transactional

of people to how shape vacations more normal, we slower way we terms should of half would of quarter be transactional little little taking the you weighted the about year? be have it more bit could maybe be thoughts Just Is back of bit go any helpful. a going -- bit of hopefully, on in it to August, that just the sort it back the life a little fourth and As a on side? think

Yes, back seasonal It in the has Kirk, the sure. half been year. of

have us year transaction it's You things holidays and Giving to fourth for the and the Tuesday the natural in growth like in have quarter, so the back half on of side.

And this side up guess, EVERFI, growth the not guide I in a for doing of back been maybe the the plan. the -- the year that little Just a I'm context half Okay. of Is like gave? seems first on I of a talk you the just Can of the sounds math wondering original the you of year, the half a more precursor basis if seasonal in it like they're ends that, it slated, just because EVERFI, about it ramped in that the guide guys this context so right, of revenue on side. then talk you on recurring for on and the on just services year? full lot non-recurring being year bit but that's was has or about of in sort year that

front. that want So trending they're make I of to understand sure just I on how kind

customers. what a developing take services, this its and chunk one-time has call is EVERFI of lot we a one. I'll specific Tony. curated large Yes, that content Kirk, of for

see It going so will a core range, than customer little going decline. it's you think to and We necessarily be somewhere a of offset general across services think we're be one-time services. by we number. largely of in that And our that's the kind the one-time different fairly base, to now; EVERFI's It's a to expect what million $XX customer, used in and didn't a that see looks like implementation is but by large services services. actually not

but $X definitely EVERFI That's slightly and as did million expect the spoke about of out was be was on quarter that of We as panned offset you to kind kind offerings kind nature model back-end them. significantly definitely improved kind systems the spoke at profitability back-end of of was expect loaded. loaded. and budget upsell or as versus model, There's the on the and number with of materials. existing million if improved beast recall, lot the $X they the expand what comments in between were prepared That's year. in that core, services a We deal well school the as we We revenue short and in well. $XX the of with training of That is EVERFI's plan, pieces renewal -- or other before, educational other about customers million. geographies a the into to, budget. their as deal came --

see our the year. being but on of first offsetting 'XX have got hit half plan coming advance, bookings the growth loaded, It then back expectations, would this year. them more right were with impact we've they will the renewal this like and for lower improvements in The et would really, in some year expectations be That we right things that half. into you with a typically. revenue hence, that our one line what is impact is plan the more overall bill in So And cash won't cetera. softness in on a a be lot the flow an rates, because

it bit flow So little year. this cash a hits

That's super helpful.

Peterson with question next James. Brian the comes of line Raymond Our from

EVERFI the follow-up to Tony, I on wanted question.

when or upsell algorithm, moving the for of it's know part of that typically more we're trying expansion-based booking just -- how typically about when here. it that starts? the to think does a is I growth net Is I small the understand if some about works we versus think a new reduction, And if lag parts you're So new? business, it between them, that in thinking there hit revenue?

and Yes, depends right? right? the or and deal. very, already you're in expanding Because to quickly, existing on to with already can cases, the systems, school can taking other Brian, just exists it be like it immediate states that it upsells potentially, -- other other you're geographies on that customers, many It's turn So very renewal interesting, renewal opportunity, recognition. so it

looking a it's If rolled content it of the I to little turns he in X it turn on, and you to months X on. when [if for and runs here. think to out, have theme that So the develop kind is] just brand-new it's get deal a at

of between in the could type a in a depending be there's there how transaction, be the build, between. little the training mix then So will big quickly of kind on and between curriculum

that in can months, curating take for is one-time creating interesting. if his that kind So Again, because specific The mix we or build not those of deals revenue a customer. enterprise-level kind that had in then comments to prepared deals. and some this Mike out weeks, can spoke be we're if it's services is pushed, of material. first very large relatively answer, his

pushed. We that and certainly were ARR very Renewals multimillion have multi, of expansions some that kind transactions dollar also. be can large

now very We the have some are that that look promising expansion. in works

to to transactions how for when the of to of bit revenue, really read me then So to the model of both good splotchiness hit they on that so in it's and timing over size to turn board end. you as give and all create little a a it's the going the kind the as the difficult

I understand. I No, appreciate there, Tony. color the

ahead, Mike. go Sorry,

reminder. add just -- revenue. was is business say, The our XX% of quick to I just a Yes. EVERFI going quick

there. on but total big there's opportunities at lumpiness really some enterprise enterprise bookings the isn't their deals level, So Blackbaud the material

are because So some there. I big some the little they're mentioned lumpy deals customers they're earlier. opportunities with I of a that enterprise-type mentioned

opportunity a overlap cross-sell the space a there. platforms. unique nice with just lot put for YourCause and a ESG the because footprint is got we whole a those them this base, customer cross-sell So opportunity. growth, they've together And product Not with and both line awesome opportunity there's an really just with of ways nice

kind -- appreciate understood. segue a on there, guys. And I of No, the all Mike. kind that, color maybe of

gave the color a a or You lot parts the and gave on lot moving a of me macro of here. lot color of

right? developed of So in commonality deals it I'd Blackbaud? any coming I on it's that predicated Blackbaud, of be of product. last to at new seen are net you different of what of macro, curious, coming kind you new the If have Not sort net to is pace the XX over days? that looked the customers terms know by all And

what in. The interesting logos is ultimate markets. and I'll in coming last the pandemic And we've end the resiliency repeat the prepared mentioned it. was the thing of test. still remarks, markets, The see kind -- of two our We years about really learned Yes. in new our end my just this I

art pandemic they're the didn't the some the You and museums, our that. chunk pandemic, any closed market recessions a of out think sector of and didn't really. size and serve; we past were big that We about performing of take business end put a centers the customers like see I'll during of of markets them, In completely open.

And so countries is of recession things a impact. or less in U.S. a the economies in slowdown like the much different of an

cross-sell in with we're with about So opportunities working excited we're markets and EVERFI, space. the that pretty end we're deals a logo corporation pretty opportunities, YourCause, so excited big our the growth that new about

VanVliet BTIG. next question from comes Our with Matt

last an the bit little of more a on Mike. answer, extension Maybe

a As you potential market, like macro how reduce declined issues? past sensitivity to broader than other economic of of past, year, giving to gifts giving the have reduced at that the substantially? of on some seen given individual an end feel you more and recession? correlation in seen maybe particular, Do maybe end have that through guys tends more of where you've more one-time in stock some in-person average of look a Or reliant the sort basis. pretty around at kind those that giving of What of you looked times events in the have markets or the are size you your has on even

Yes, Matt.

As at back of I -- look your size in the my on we behavior remarks, and giving performance. did mentioned giving, past go giving recessions actually in Blackbaud's giving prepared and is question side. And the

we in giving that And is $XXX It's it. percentage fact a you all, of massive. year. the I'll very of small over remind think actually billion you the about U.S., that monetize First a

and one there, the us a after. 'XX 'XX So the giving still significant. of and for then. timeframe, from little and backwards It's huge regardless Back even up since a works, to a there's macro it's in accelerated bit such TAM go gone how lot

that almost really as individuals far billion, around $XXX small donation is doesn't are the Most of So size. XX% concern and pretty it averages us. as

do a a one. the it. number in of percentage number giving impact happened we or recessions on two, potential down small And not see So we in with economy slowing monetize It hasn't recessions. past, just

it backwards, if So percentage, a us. did go only a words, TAM in monetize huge we which even other is small for

sector third-largest it's the very The U.S. the of part is non-profit economy, So a the in employer really. resilient

run monetize XX% we part And big as is monetize So a systems we a gifts, a that, on that. That not do makes one-time issue. XXX of question smaller gifts the and sense. small part not see of are anyway, We or which the large don't XX% online. through payment one-time that so of the your

looked And timeframe, lot So a we back smaller performance. company side. at are revenue less and went on back, looked a recessions, at we 'XX past Blackbaud's in the much 'XX, recurring

a and so we're in $X we're base, revenue, we over past. were much So in the billion better a bigger XX% recurring position than actually much

you Very looking Okay. the initiatives, newer traction like as then look terms the at or maybe rates in has the what any of you been helpful. provide update could penetration some kind of Management side? of Church And

Blackbaud EVERFI Raiser's our K-XX and that big a we and that smaller cross-sell of new we're lot EVERFI space. on Edge of with platform recent a We're well. EVERFI. had their Church, X. We content new map that guess, the developing NXT lot deployed I the I some ed, the them, faith-based Management releases space, press we've then is got cross-selling And And NXT. Edge to think we're space is the, a while colleges, talked just the and have couple new in in Financial upsell platform, progressing Yes, and space. I new Sure. logos at well. lots selling and a some renew lot content Education cross-selling we as ed cross-sell, of The logos road EVERFI, built schools. K-XX about that we've higher are We're higher faith-based

with And America. question our Koji next line Bank of of the Ikeda from comes

is Kanika Mehta This on , Koji. for

a customers? of question changes changes around called specific color Is renewal? from there. becoming to a Just your there around So management any more is changes feedback wanted Yes. terms out you've good on any Any more in which you call customer-centric? [office] that thing. and retention and focusing new some customer out have I Are specifically you some more in in strategy got

sure. Yes,

retention XX% on So And us. it's great lot made yes, there's -- in growth nicely. We've up like the last that's a a billion it's year -- a with revenue, and numbers for over just big opportunity renewals, and $X are things business opportunity of reoccurring for progress us.

and of named given a Chief Customer big our big recently and and Chris reoccurring scale Kevin our ours, organizations we Singh, drive And we've the a for revenue. Gregoire as because and automation a a customer engineering we're focus our to growth it's us Chief so us IT as it's XX% really and with customer Officer. opportunity retention Operating He's And success little Officer, over together been year. put

in come after from and up go step nothing to this has So just renewals. customers. big It's opportunity driving the next maturity really of retention organization in our that growth

end And for session. now closing back CEO, to of reached over I'll we call Mike Gianoni, have question-and-answer the And remarks. the turn the

ranges. by close year, exchange aside our reiterating, rest revenue of profitability first half rates, fall from our year. just And outlook looking of we I'll would foreign the outstanding movement in and guidance to unfavorable the within operator. original you, had the Thank an

plan environment as in business us investments to our goal positioned well Overall, balance our of sustainable to achieving progressing look We discipline on well on XXXX strategic operating program our continue look has call. Rule providing of confident macro our and incremental toward next underway drive forward to execute the our we everyone. We continue core to to monitor as XX. remain for long-term as to updates with ability growth. further initiatives Thanks, already

participation. This and for disconnect concludes at this time. lines Thank you your conference, today's may your you