TTEC Announces First Quarter 2025 Financial Results

First Quarter 2025Revenue was $534.2 Million, down 7.4 PercentNet Income was $3.2 Million or 0.6 Percent of Revenue($13.6 Million or 2.6 Percent of Revenue Non-GAAP)Adjusted EBITDA was $56.4 Million or 10.6 Percent of Revenue Reiterates Outlook for Full Year 2025 , /PRNewswire/ -- TTEC Holdings, Inc. (NASDAQ:TTEC), a leading global CX (customer experience) technology and services innovator for AI-enabled CX with solutions from TTEC Engage and TTEC Digital, announced today financial results for the first quarter ended March 31, 2025. "2025 is off to a good start with our financial performance exceeding plan. In the first quarter, we signed several new enterprise clients, grew the share of wallet with our embedded base, broadened our market reach with more complex digitally enabled solutions, built valuable partnerships with new CX technology partners, improved operational performance, and fortified the leadership team," commented Ken Tuchman, chairman and chief executive officer of TTEC. "While we are pleased with our first quarter results, many of our clients are adopting a cautious approach in the current economic environment. Due to the recent uncertainty in trade policy, it is challenging for any business operating on a global scale to accurately predict the future. As a result, we are staying close to our clients and remaining agile as we look forward to policy stabilization," Tuchman continued. FIRST QUARTER 2025 FINANCIAL HIGHLIGHTS Revenue First quarter 2025 GAAP revenue was $534.2 million, a 7.4 percent decrease compared to $576.6 million in the prior year. Foreign exchange had a $6.0 million negative impact on revenue in the first quarter of 2025. Income from Operations First quarter 2025 GAAP income from operations was $24.2 million, or 4.5 percent of revenue, compared to $22.7 million, or 3.9 percent of revenue in the prior year. Non-GAAP income from operations, excluding restructuring and impairment charges, equity-based compensation expenses, amortization of purchased intangibles, and other items, was $41.5 million, or 7.8 percent of revenue, compared to $37.9 million, or 6.6 percent of revenue in the prior year. Foreign exchange had a $4.2 million positive impact on Non-GAAP income from operations in the first quarter of 2025. Adjusted EBITDA First quarter 2025 Non-GAAP Adjusted EBITDA was $56.4 million, or 10.6 percent of revenue, compared to $54.9 million, or 9.5 percent of revenue in the prior year. Earnings Per Share First quarter 2025 GAAP fully diluted earnings per share was $0.07 compared to $0.01 in the prior year. Non-GAAP fully diluted earnings per share was $0.28 compared to $0.27 in the prior year. CASH FLOW AND BALANCE SHEET Cash flow from operations in the first quarter of 2025 was a positive $21.6 million compared to a negative $15.6 million for the first quarter of 2024. Free cash flow in the first quarter of 2025 was a positive $16.2 million compared to a negative $29.1 million for the first quarter of 2024. Capital expenditures in the first quarter of 2025 were $5.4 million compared to $13.5 million for the first quarter of 2024. As of March 31, 2025, TTEC had cash and cash equivalents of $85.1 million and debt of $966.6 million, resulting in a net debt position of $881.4 million. This compares to a net debt position of $865.3 million for the same period 2024. As of March 31, 2025, TTEC's remaining borrowing capacity under its revolving credit facility was approximately $230 million compared to $95 million for the same period 2024. SEGMENT REPORTING & COMMENTARY TTEC reports financial results for TTEC Digital and TTEC Engage business segments. Financial highlights for the two business segments are provided below. TTEC Digital – Design, build and operate tech-enabled, insight-driven CX solutions First quarter 2025 GAAP revenue for TTEC Digital was $108.0 million, a decrease of 3.6 percent compared to $112.0 million for the year ago period. Income from operations was $5.9 million or 5.4 percent of revenue compared to $3.3 million or 2.9 percent of revenue in the prior year. Non-GAAP income from operations was $12.1 million, or 11.2 percent of revenue compared to operating income of $9.3 million or 8.3 percent of revenue in the prior year. TTEC Engage – Technology-enabled customer care, acquisition, and fraud mitigation services First quarter 2025 GAAP revenue for TTEC Engage was $426.2 million, an 8.3 percent decrease from $464.6 million for the year ago period. Income from operations was $18.3 million or 4.3 percent of revenue compared to $19.4 million, or 4.2 percent of revenue in the prior year. Non-GAAP income from operations was $29.4 million, or 6.9 percent of revenue, compared to operating income of $28.7 million, or 6.2 percent of revenue in the prior year. Foreign exchange had a $5.5 million negative impact on revenue and a $4.2 million positive impact on income from operations. BUSINESS OUTLOOK "We exceeded our plan in the first quarter with both segments delivering strong results. In TTEC Digital, our client centric go-to-market approach, AI-enabled solutions and analytics, and multi-platform capabilities are resonating in the market. In TTEC Engage, we continue to focus on our top priorities, improving operational agility, providing digitally enabled solutions and optimizing our cost structure to further drive momentum," commented Kenny Wagers, chief financial officer of TTEC. Wagers continued, "We are pleased with our first quarter results and are re-iterating our full-year outlook. It is difficult to predict how the economic uncertainties will impact our existing clients and potential new clients, however, both our TTEC Digital and TTEC Engage segments are well positioned to navigate the current environment." TTEC Full Year 2025 Outlook Full Year 2025Guidance Full Year 2025Mid-Point Revenue $2,014M — $2,064M $2,039M Non-GAAP adjusted EBITDA $215M — $235M $225M Non-GAAP adjusted EBITDA margins 10.7% — 11.4% 11.0 % Non-GAAP operating income $154M — $174M $164M Non-GAAP operating income margins 7.6% — 8.4% 8.0 % Interest expense, net ($75M) — ($79M) ($77M) Non-GAAP adjusted tax rate 38% — 42% 40 % Diluted share count 48.2M — 48.6M 48.4M Non-GAAP earnings per a share $0.95 — $1.20 $1.08 Engage Full Year 2025 Outlook Full Year 2025Guidance Full Year 2025Mid-Point Revenue $1,556M — $1,586M $1,571M Non-GAAP adjusted EBITDA $151M — $163M $157M Non-GAAP adjusted EBITDA margins 9.7% — 10.3% 10.0 % Non-GAAP operating income $101M — $113M $107M Non-GAAP operating income margins 6.5% — 7.1% 6.8 % Digital Full Year 2025 Outlook Full Year 2025Guidance Full Year 2025Mid-Point Revenue $458M — $478M $468M Non-GAAP adjusted EBITDA $64M — $72M $68M Non-GAAP adjusted EBITDA margins 13.9% — 15.0% 14.5 % Non-GAAP operating income $53M — $61M $57M Non-GAAP operating income margins 11.5% — 12.7% 12.1 % The company has not quantitatively reconciled its guidance for Non-GAAP operating income, Non-GAAP operating income margins, Non-GAAP adjusted EBITDA, Non-GAAP adjusted EBITDA margins, Non-GAAP adjusted tax rate, or Non-GAAP earnings per share to their respective most comparable GAAP measures because certain of the reconciling items that impact these metrics, including restructuring and impairment charges, equity-based compensation expense, changes in acquisition contingent consideration, depreciation and amortization expense, and provision for income taxes are dependent on the timing of future events outside of the Company's control or cannot be reliably predicted. Accordingly, the Company is unable to provide reconciliations to GAAP operating income, operating income margins, EBITDA margins, and diluted earnings per share without unreasonable effort. Please note that the unavailable reconciling items could significantly impact the Company's 2025 financial results as reported under GAAP. NON-GAAP FINANCIAL MEASURES This press release contains a discussion of certain Non-GAAP financial measures that the company includes to allow investors and analysts to measure, analyze and compare its financial condition and results of operations in a meaningful and consistent manner. A reconciliation of these Non-GAAP financial measures can be found in the tables accompanying this press release. GAAP metrics are presented in accordance with Generally Accepted Accounting Principles. Non-GAAP - As reflected in the attached reconciliation table, the definition of Non-GAAP may exclude from operating income, EBITDA, net income and earnings per share restructuring and impairment charges, equity-based compensation expenses, amortization of purchased intangibles, among other items. EARNINGS WEBCAST/CONFERENCE CALL TTEC will host a live webcast and conference call at 8:30 a.m. ET on Friday, May 9, 2025. You are invited to join a live webcast of the conference call by visiting the "Investors Relations" section of the TTEC website at www.ttec.com. If you are unable to participate during the live webcast, a replay will be available on the TTEC website. ABOUT TTEC TTEC (pronounced T-TEC) Holdings, Inc. (NASDAQ:TTEC) is a leading global CX (customer experience) technology and services innovator for AI-enabled digital CX solutions. Serving iconic and disruptive brands, TTEC's outcome-based solutions span the entire enterprise, touch every virtual interaction channel, and improve each step of the customer journey. Leveraging next-gen digital technology, the Company's TTEC Digital business designs, builds, and operates omnichannel contact center technology, CRM, AI and analytics solutions. The company's TTEC Engage business delivers AI-enabled customer engagement, customer acquisition and growth, tech support, back office, and fraud prevention services. Founded in 1982, the company's singular obsession with CX excellence has earned it leading client, customer, and employee satisfaction scores across the globe. The company's employees operate on six continents and bring technology and humanity together to deliver happy customers and differentiated business results. To learn more visit us at https://www.ttec.com. FORWARD-LOOKING STATEMENTS This Earnings Press Release and related oral statements contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements relating to our operations, expected financial position, results of operation, effective tax rate, cash flow, leverage, liquidity, business strategy, profit improvement actions, competitive position, demand for our services in international operations, acquisition opportunities and impact of acquisitions, capital allocation and dividends, growth opportunities, spending, capital expenditures and investments, competition and market forecasts, industry trends, our human capital resources, and other business, operational and financial matters that are based on our current expectations, assumptions, and projections with respect to the future, and are not a guarantee of performance. In this Release when we use words such as "may," "believe," "plan," "will," "anticipate," "estimate," "expect," "intend," "project," "would," "could," "target," or similar expressions, or when we discuss our strategy, plans, goals, initiatives, or objectives, we are making forward-looking statements. Unless otherwise indicated or except where the context otherwise requires, the terms "TTEC," "the Company," "we," "us" and "our" and other similar terms in this report refer to TTEC Holdings, Inc. and its subsidiaries. We caution you not to rely unduly on any forward-looking statements. Actual results may differ materially from those expressed in the forward-looking statements, and you should review and consider carefully the risks, uncertainties, and other factors that affect our business and may cause such differences as outlined in Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2024 and any subsequent filings with the U.S. Securities and Exchange Commission (the "SEC") which are available on TTEC's website www.ttec.com, and on the SEC's public website at www.sec.gov. Our forward-looking statements speak only as of the date that this release is issued. We undertake no obligation to update them, except as may be required by applicable law. Although we believe that our forward-looking statements are reasonable, they depend on many factors outside of our control and we can provide no assurance that they will prove to be correct. TTEC HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (unaudited) Three months ended March 31, 2025 2024 Revenue $ 534,228 $ 576,638 Operating Expenses: Cost of services 414,547 453,818 Selling, general and administrative 70,037 74,575 Depreciation and amortization 22,698 25,145 Restructuring charges, net 1,996 249 Impairment losses 761 140 Total operating expenses 510,039 553,927 Income From Operations 24,189 22,711 Other income (expense), net (11,628) (19,882) Income Before Income Taxes 12,561 2,829 Provision for income taxes (9,315) (2,329) Net Income 3,246 500 Net (loss) / income attributable to noncontrolling interest (1,862) (2,805) Net Income / (Loss) Attributable to TTEC Stockholders $ 1,384 $ (2,305) Net Income Per Share Basic $ 0.07 $ 0.01 Diluted $ 0.07 $ 0.01 Net Income / (Loss) Per Share Attributable to TTEC Stockholders Basic $ 0.03 $ (0.05) Diluted $ 0.03 $ (0.05) Income From Operations Margin 4.5 % 3.9 % Net Income Margin 0.6 % 0.1 % Net Income / (Loss) Attributable to TTEC Stockholders Margin 0.3 % (0.4) % Effective Tax Rate 74.2 % 82.3 % Weighted Average Shares Outstanding Basic 47,771 47,432 Diluted 48,225 47,587 TTEC HOLDINGS, INC. AND SUBSIDIARIES SEGMENT INFORMATION (In thousands) (unaudited) Three months ended March 31, 2025 2024 Revenue: TTEC Digital $ 108,040 $ 112,031 TTEC Engage 426,188 464,607 Total $ 534,228 $ 576,638 Income From Operations: TTEC Digital $ 5,864 $ 3,288 TTEC Engage 18,325 19,423 Total $ 24,189 $ 22,711 TTEC HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands) (unaudited) March 31, December 31, 2025 2024 ASSETS Current assets: Cash and cash equivalents $ 85,135 $ 84,991 Accounts receivable, net 440,190 452,573 Prepaids and other current assets 109,611 92,947 Income and other tax receivables 20,301 21,785 Total current assets 655,237 652,296 Property and equipment, net 123,274 132,051 Operating lease assets 84,944 91,263 Goodwill 571,919 571,197 Other intangibles assets, net 157,098 164,808 Income and other tax receivables, long-term 24,279 31,781 Other assets 109,485 109,984 Total assets $ 1,726,236 $ 1,753,380 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 77,406 $ 84,180 Accrued employee compensation and benefits 116,779 137,636 Deferred revenue 70,675 64,752 Current operating lease liabilities 32,116 33,358 Other current liabilities 37,327 34,010 Total current liabilities 334,303 353,936 Long-term liabilities: Line of credit 964,000 975,000 Non-current operating lease liabilities 65,236 71,008 Other long-term liabilities 81,191 85,317 Total long-term liabilities 1,110,427 1,131,325 Equity: Common stock 478 477 Additional paid in capital 423,368 420,181 Treasury stock (584,900) (584,900) Accumulated other comprehensive income (loss) (122,973) (132,121) Retained earnings 548,001 546,617 Noncontrolling interest 17,532 17,865 Total equity 281,506 268,119 Total liabilities and equity $ 1,726,236 $ 1,753,380 TTEC HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (unaudited) Three Months Ended Three Months Ended March 31, March 31, 2025 2024 Cash flows from operating activities: Net income $ 3,246 $ 500 Adjustment to reconcile net income to net cash provided by operating activities : Depreciation and amortization 22,698 25,145 Amortization of contract acquisition costs 494 283 Amortization of debt issuance costs 510 643 Imputed interest expense and fair value adjustments to contingent consideration - (1,240) Provision for credit losses 251 (31) Loss on disposal of assets 316 510 Impairment losses 761 140 Deferred income taxes 1,913 (12,628) Excess tax benefit from equity-based awards 236 292 Equity-based compensation expense 3,250 5,812 Loss / (gain) on foreign currency derivatives (68) 77 Changes in assets and liabilities, net of acquisitions: Accounts receivable 14,189 (11,301) Prepaids and other assets (1,720) 3,094 Accounts payable and accrued expenses (14,204) (25,845) Deferred revenue and other liabilities (10,280) (1,080) Net cash provided by operating activities 21,592 (15,629) Cash flows from investing activities: Proceeds from sale of property, plant and equipment 127 25 Purchases of property, plant and equipment (5,406) (13,473) Net cash used in investing activities (5,279) (13,448) Cash flows from financing activities: Net proceeds / (borrowings) from line of credit (11,000) (42,000) Payments on other debt (462) (741) Payments to noncontrolling interest (2,211) (2,520) Tax payments related to the issuance of restricted stock units (62) (127) Payments of debt issuance costs (1,100) Net cash provided by financing activities (13,735) (46,488) Effect of exchange rate changes on cash and cash equivalents and restricted cash (2,434) 1,847 Increase / (decrease) in cash, cash equivalents and restricted cash 144 (73,718) Cash, cash equivalents and restricted cash, beginning of period 84,991 173,905 Cash, cash equivalents and restricted cash, end of period $ 85,135 $ 100,187 TTEC HOLDINGS, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION (In thousands, except per share data) (unaudited) Three months ended March 31, 2025 2024 Revenue $ 534,228 $ 576,638 Reconciliation of Non-GAAP Income from Operations and EBITDA: Income from Operations $ 24,189 $ 22,711 Restructuring charges, net 1,996 249 Impairment losses 761 140 Property costs not related to operations (46) 1,033 Mexico VAT consulting fees 408 - Liability related to notifications triggered by labor scheme - (475) Expenses related to non-binding offer 3,189 - Equity-based compensation expenses 3,250 5,812 Amortization of purchased intangibles 7,750 8,445 Non-GAAP Income from Operations $ 41,497 $ 37,915 Non-GAAP Income from Operations Margin 7.8 % 6.6 % Depreciation and amortization 14,948 16,069 Changes in acquisition contingent consideration - (1,240) Gain on property sale (450) - Mexico VAT Recovery (3,906) 770 Foreign exchange loss / (gain), net 750 1,192 Other Income (expense), net 3,589 206 Adjusted EBITDA $ 56,428 $ 54,912 Adjusted EBITDA Margin 10.6 % 9.5 % Reconciliation of Non-GAAP EPS: Net Income $ 3,246 $ 500 Add: Asset impairment and restructuring charges 2,757 389 Add: Equity-based compensation expenses 3,250 5,812 Add: Amortization of purchased intangibles 7,750 8,445 Add: Property costs not related to operations (46) 1,033 Add: Liability related to notifications triggered by labor scheme - (475) Add: Foreign VAT (inclusive of interest) (7,823) 770 Add: Changes in acquisition contingent consideration - (1,240) Add: Fees related to non-binding offer 3,189 - Add: Gain on property sale (450) - Add: Foreign exchange loss / (gain), net 750 1,192 Less: Changes in valuation allowance, return to provision adjustments and other, and tax effects of items separately disclosed above 1,002 (3,806) Non-GAAP Net Income $ 13,625 $ 12,620 Diluted shares outstanding 48,225 47,587 Non-GAAP EPS $0.28 $0.27 Reconciliation of Free Cash Flow: Cash Flow From Operating Activities: Net income $ 3,246 $ 500 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 22,698 25,145 Other (4,352) (41,274) Net cash provided by operating activities 21,592 (15,629) Less - Total Cash Capital Expenditures 5,406 13,473 Free Cash Flow $ 16,186 $ (29,102) Reconciliation of Non-GAAP Income from Operations and Adjusted EBITDA by Segment : TTEC Engage TTEC Digital Q1 25 Q1 24 Q1 25 Q1 24 Income from Operations $ 18,325 $ 19,422 $ 5,864 $ 3,289 Restructuring charges, net 1,292 653 703 (404) Impairment losses 720 140 42 - Property costs not related to operations (46) 1,033 - - Mexico VAT Consulting Fees 408 (475) - - Expenses related to non-binding offer 2,633 - 556 - Equity-based compensation expenses 2,023 3,783 1,227 2,029 Amortization of purchased intangibles 4,067 4,107 3,683 4,338 Non-GAAP Income from Operations $ 29,422 $ 28,663 $ 12,075 $ 9,252 Depreciation and amortization 12,139 13,357 2,809 2,712 Gain on Property Sale (450) (1,240) - - Mexico VAT Recovery (3,906) - - - Foreign VAT receivable writeoff - 770 - - Foreign exchange loss / (gain), net 751 1,378 (1) (187) Other Income (expense), net 3,587 44 2 163 Adjusted EBITDA $ 41,543 $ 42,972 $ 14,885 $ 11,940 SOURCE TTEC Holdings, Inc. 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TTEC Announces First Quarter 2025 Financial Results

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