The Hackett Group (HCKT) Q4 2024 earnings summary

Executive summary

• Q4 2024 revenue was $79.2 million, with adjusted EPS of $0.47, both exceeding guidance, driven by strong SAP and GenAI segment performance.

• Acquisition of LeewayHertz and the launch of a GenAI-focused joint venture (ZBrain) are expected to drive future growth and expand GenAI consulting capabilities.

• Sequential and year-over-year revenue growth was achieved, with improved advisory program sales and renewals.

• Adjusted diluted EPS was $0.47, while GAAP diluted EPS was $0.12, impacted by non-cash compensation and acquisition expenses.

Financial highlights

• Q4 2024 total revenue was $79.2 million; revenue before reimbursements was $77.5 million, above guidance.

• Adjusted EBITDA was $19.5 million (25.2% of revenues before reimbursements), up from $16.3 million (23%) YoY.

• Adjusted net income was $13.6 million, or $0.47 per share, up from $0.39 per share YoY.

• GAAP net income was $3.6 million ($0.12 per share), down from $7.9 million ($0.28 per share) YoY, impacted by stock compensation and acquisition expenses.

• Cash balance at quarter end was $16.4 million, up from $10 million in the prior quarter.

Outlook and guidance

• Q1 2025 revenues before reimbursements expected at $75.0–$76.5 million.

• Q1 2025 adjusted diluted EPS guidance is $0.39–$0.41, assuming a 22% GAAP tax rate.

• Global S&BT segment revenue expected to grow 5–10% YoY, driven by GenAI, offset by declines in OneStream and e-procurement.

• Oracle and SAP segments combined expected to decline 8–10% YoY in Q1.

• Adjusted gross margin expected at 43–44%; adjusted EBITDA margin at 21–22%.