August 4, 2008

Blackbaud, Inc. Announces Second Quarter 2008 Results and Third Quarter 2008 Dividend

Blackbaud, Inc.

CHARLESTON, S.C. - Aug. 4, 2008 - Blackbaud, Inc. (Nasdaq: BLKB), the leading provider of software and related services designed specifically for nonprofit organizations, today announced financial results for its second quarter ended June 30, 2008.

Marc Chardon, Chief Executive Officer of Blackbaud, stated, "We are pleased with the Company's overall financial performance in the second quarter in the face of the continued challenging economic environment. The quarter was highlighted by solid total revenue growth, continued rapid growth in our subscription revenue and strong profit margins that drove our non-GAAP earnings per share to the high-end of our expectations."

Chardon continued, "During the quarter, we added two new Enterprise CRM customers, including the upgrade of an existing Target Team Approach customer. This upgrade represented the achievement of the last of our four major Target Software milestones, approximately six months ahead of schedule. We were also pleased with the traction displayed by our eTapestry software-as-a-service fundraising offering, which delivered strong operating results in the quarter. The success we have enjoyed with both the Target and eTapestry acquisitions provides us with confidence as we begin to integrate the recently announced Kintera acquisition. Customer and employee response have been decidedly positive since that acquisition announcement, and we look forward to adding the industry's leading on-line fundraising solution to our product suite and further solidifying the growth of our subscription revenue."

For the quarter ended June 30, 2008, Blackbaud reported total revenue of $72.5 million, an increase of 13% compared with the second quarter of 2007. Income from operations and net income, determined in accordance with generally accepted accounting principles ("GAAP"), were $14.6 million and $9.0 million, respectively, for the second quarter of 2008. This compares to GAAP income from operations of $13.6 million and net income of $8.2 million in the same period last year. GAAP diluted earnings per share were $0.21 for the quarter ended June 30, 2008, compared with $0.19 in the same period last year.

For the quarter ended June 30, 2008, non-GAAP income from operations, which excludes stock-based compensation expense and amortization of intangibles arising from business combinations, was $18.0 million, an increase of 11% from $16.2 million in the same period last year. Non-GAAP net income was $10.9 million for the quarter ended June 30, 2008, an increase of 12% from $9.7 million in the same period last year. Non-GAAP diluted earnings per share were $0.25 for the quarter ended June 30, 2008, at the high-end of the Company's guidance and an increase of 14% over the same period last year.

A reconciliation of GAAP to non-GAAP results has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below under the heading "Non-GAAP Financial Measures."

The Company generated $21.5 million in cash from operations for the six months ended June 30, 2008 and during the second quarter, the Company repurchased approximately 580,000 shares of its stock for approximately $13.4 million. On a year-to-date basis, the Company has repurchased approximately 1.5 million shares for approximately $36.0 million.

Timothy V. Williams, Chief Financial Officer of Blackbaud, stated, "The Company was able to deliver a higher-than-expected non-GAAP operating margin of 25% during the second quarter, leading to non-GAAP diluted EPS that was at the high-end of our expectations. In addition, we continue to believe the Company will deliver strong cash flows during 2008, and our third quarter is off to a good start with record collections in July following the conversion to a new billing system and related increase in receivables during the second quarter."

Williams continued, "The macro-economic environment was challenging in the first half of 2008, and we believe it is prudent to expect a similar environment for the remainder of the year. With a strong market position and business model in place, we continue to believe the Company is well positioned to deliver solid revenue growth and strong profitability during 2008. From a longer-term perspective, we believe the Kintera acquisition further enhances our financial profile by increasing our subscription revenue, which continues to be our highest growth revenue source."

Third Quarter 2008 Dividend and Share Repurchase Authorization
Blackbaud announced today that its Board of Directors has declared a third quarter dividend of $0.10 per share payable on September 15, 2008 to stockholders of record on August 28, 2008. Additionally, in May 2008, the Board of Directors authorized an increase in the Company's common stock share repurchase authorization to $40.0 million. As of June 30, the Company had approximately $38.5 million remaining under this authorization.

Conference Call Details
Blackbaud will host a conference call today, August 4, 2008, at 5:00 p.m. (Eastern Time) to discuss the Company's financial results, operations and related matters. To access this call, dial 888-801-6494 (domestic) or 913-981-5542 (international). A replay of this conference call will be available through August 11, 2008, at 888-203-1112 (domestic) or 719-457-0820 (international). The replay passcode is 3148327. A live webcast of this conference call will be available on the "Investor Relations" page of the Company's Web site, and a replay will be archived on the Web site as well.

About Blackbaud
Blackbaud is the leading global provider of software and services designed specifically for nonprofit organizations, enabling them to improve operational efficiency, build strong relationships, and raise more money to support their missions. Approximately 22,000 organizations – including University of Arizona Foundation, American Red Cross, Cancer Research UK, The Taft School, Lincoln Center, InTouch Ministries, Tulsa Community Foundation, Ursinus College, Earthjustice, International Fund for Animal Welfare, and the WGBH Educational Foundation – use one or more Blackbaud products and services for fundraising, constituent relationship management, financial management, website management, direct marketing, education administration, ticketing, business intelligence, prospect research, consulting, and analytics.

Since 1981, Blackbaud's sole focus and expertise has been partnering with nonprofits and providing them the solutions they need to make a difference in their local communities and worldwide. Headquartered in the United States, Blackbaud also has operations in Canada, the United Kingdom, and Australia. For more information, visit www.blackbaud.com.

Forward-looking Statements
Except for historical information, all of the statements, expectations, and assumptions contained in this news release are forward-looking statements that 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: general economic risks; uncertainty regarding increased business and renewals from existing customers; continued success in sales growth; management of integration of acquired companies and other risks associated with acquisitions; risks associated with successful implementation of multiple integrated software products; the ability to attract and retain key personnel; risks related to our dividend policy and share repurchase program, including potential limitations on our ability to grow and the possibility that we might discontinue payment of dividends; risks relating to restrictions imposed by the credit facility; risks associated with management of growth; lengthy sales and implementation cycles, particularly in larger organizations; technological changes that make our products and services less competitive; and the other risk factors set forth from time to time in the SEC filings for Blackbaud, copies of which are available free of charge at the SEC's website at www.sec.gov upon request from Blackbaud's investor relations department.

Non-GAAP Financial Measures
Blackbaud has provided in this release financial information that has not been prepared in accordance with GAAP. This information includes non-GAAP income from operations and margin, non-GAAP net income and non-GAAP diluted earnings per share. Blackbaud uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, as a supplement to GAAP measures, in evaluating Blackbaud's ongoing operational performance. Blackbaud believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing its financial results with other companies in Blackbaud's industry, many of which present similar non-GAAP financial measures to investors. As noted, the non-GAAP financial results discussed above exclude stock-based compensation expense and costs associated with amortization of intangibles arising from business combinations. 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 reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measure below. As previously mentioned, a reconciliation of our 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.