Harte Hanks (HHS) investor relations material

Executive summary

• Q2 2025 revenue was $38.6 million, down 14.2% year-over-year, with declines across all segments due to customer turnover and cautious client spending.

• Net loss for Q2 2025 was $0.3 million ($0.05/share), a significant improvement from a $27.8 million ($3.84/share) loss in Q2 2024, which included large pension termination charges.

• Project Elevate transformation program continued, targeting $16 million in cost savings through 2027, with $1.0 million in restructuring charges recorded YTD.

• Positive EBITDA of $1.1 million and adjusted EBITDA of $1.5 million reflect operational discipline and a debt-free balance sheet.

• Project Elevate and cost controls remain central to the multi-year transformation strategy.

Financial highlights

• Operating income for Q2 2025 was $34,000, down from $1.4 million in Q2 2024; operating margin fell to 0.1% from 3.0%.

• Adjusted operating income was $403,000, with an adjusted operating margin of 1.0% versus 5.6% last year.

• Cash and cash equivalents were $4.8 million at June 30, 2025, rising to $9.9 million by July 31, 2025.

• No borrowings outstanding under the $25 million credit facility; $24 million available after letters of credit.

• Net loss per share was $(0.05) for Q2 2025, compared to $(3.84) in Q2 2024.

Outlook and guidance

• Management expects to meet liquidity needs for the next twelve months and beyond, with no substantial doubt about going concern.

• Further cost reductions are anticipated as Project Elevate progresses, with restructuring charges expected to total $10.1 million through 2025.

• Focus remains on operational efficiencies, new customer acquisition, and expanding client relationships to support long-term profitability.

• Strong cash position and zero-debt profile provide opportunities for investment in growth and shareholder value initiatives.