TTEC (TTEC) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue was $534.2 million, down 7.4% year-over-year, with TTEC Digital contributing 20.2% and TTEC Engage 79.8% of total revenue; foreign exchange negatively impacted revenue by $6.0 million.

• Adjusted EBITDA improved to $56.4 million (10.6% margin), up from $54.9 million (9.5%) in the prior year, driven by operational efficiencies and margin expansion.

• Clients remain cautious, with deal sizes starting smaller and a measured approach to AI adoption, but the company is gaining share with new enterprise wins and expanded relationships.

• Strategic focus on AI-enabled solutions, operational excellence, and deep partnerships with hyperscalers is driving differentiation and future growth.

• TTEC serves approximately 700 clients across diverse industries and operates in 22 countries with about 50,000 employees.

Financial highlights

• GAAP income from operations was $24.2 million (4.5% margin), up from $22.7 million (3.9%) year-over-year; non-GAAP income from operations was $41.5 million (7.8% margin), up from $37.9 million (6.6%).

• Net income attributable to stockholders was $1.4 million, compared to a net loss of $2.3 million in Q1 2024; non-GAAP net income was $13.6 million (2.6% of revenue).

• Free cash flow improved to $16.2 million from negative $29.1 million, aided by higher operating cash flow and lower capex.

• Cash and cash equivalents stood at $85.1 million as of March 31, 2025.

• Interest expense decreased to $19.8 million, while interest income rose to $4.6 million due to recovery of an aged VAT receivable.

Outlook and guidance

• Full-year 2025 guidance reiterated: revenue $2,014 million–$2,064 million, midpoint $2,039 million; non-GAAP adjusted EBITDA $215 million–$235 million, midpoint $225 million (margin 10.7%–11.4%).

• Non-GAAP EPS guidance $0.95–$1.20, midpoint $1.08.

• Both TTEC Digital and TTEC Engage segments expected to remain well positioned despite economic uncertainties.

• Management expects 2025 capital expenditures to be 2.2%–2.4% of revenue, with 51% for growth and 49% for maintenance.

• The company believes its liquidity and credit facility are sufficient to meet operating and capital needs for the next 12 months.