Name: PERFICIENT INC Q1 2024 Earnings Call
Start: 2024-05-06T09:51:50.000Z

Executive Summary

Q1 2024 delivered revenue of $215.3M, down 7% YoY, with GAAP diluted EPS of $0.33 (-56% YoY) and adjusted EPS of $0.77 (-26% YoY); adjusted EBITDA fell 27% to $36.5M .
Management withdrew all 2024 guidance and did not host an earnings call due to a definitive agreement to be acquired by EQT for ~$3B; the deal is at $76.00 per share in cash, subject to regulatory and shareholder approvals .
Sequentially, revenue softened versus Q4 2023 ($220.8M) and EPS compressed (GAAP $0.33 vs $0.65 prior quarter), reflecting lower operating income and higher stock-based compensation in SG&A .
Cash from operations was $32.0M (vs $41.3M in Q1 2023), with cash and equivalents at $118.2M; working capital remained solid despite merger-related dynamics .
Stock catalyst: the pending EQT transaction (certain cash value and suspended guidance/call) dominates near-term price drivers and arbitrage dynamics .

What Went Well and What Went Wrong

“Our business is steadily improving and our pipeline remains robust… momentum will continue to build throughout 2024,” said CEO Tom Hogan, highlighting demand backdrop despite reported YoY declines .
Transaction milestone: signed a definitive agreement to be acquired by EQT for $76.00 per share in cash (~$3B equity value), unanimously approved by the Board, providing “compelling, certain cash value” .
Brand and capability recognition: multiple industry awards (Appian Partner Award; Forrester Adobe Services Landscape, Automation Fabric Services) and expanded AI philanthropy (Mark Cuban Foundation bootcamps) reinforce market positioning .

Topline and profitability pressure: revenue -7% YoY to $215.3M; GAAP diluted EPS -56% YoY to $0.33; adjusted EPS -26% YoY to $0.77; adjusted EBITDA -27% YoY to $36.5M .
Operating leverage compressed: income from operations fell to $15.7M (from $37.1M in Q1 2023); SG&A stock compensation nearly doubled ($9.9M vs. $4.3M), weighing on margins .
Investor visibility reduced: management withdrew full-year guidance and canceled the earnings call, limiting forward-looking detail pending the EQT merger .

Metric	Q3 2023	Q4 2023	Q1 2024
Revenue ($USD Millions)	$223.238	$220.790	$215.304
GAAP Diluted EPS ($USD)	$0.63	$0.65	$0.33
Adjusted EPS ($USD)	$0.92	$0.99	$0.77
Net Income ($USD Millions)	$22.596	$23.175	$11.555
Operating Income ($USD Millions)	$32.216	$32.418	$15.701
Adjusted EBITDA ($USD Millions)	$45.778	$46.653	$36.462

Margins	Q3 2023	Q4 2023	Q1 2024
Adjusted EBITDA Margin (%)	20.9%	21.5%	n/a (not disclosed)

Segment breakdown (Revenue by Industry % of total):

Industry	Q3 2023	Q4 2023	Q1 2024
Healthcare/Pharma/Life Sciences	21%	21%	n/a
Financial Services/Banking/Insurance	21%	20%	n/a
Manufacturing	11%	12%	n/a
Leisure/Media/Entertainment	8%	8%	n/a
Automotive/Transportation	8%	8%	n/a
Other	31%	31%	n/a

KPIs:

KPI	Q3 2023	Q4 2023	Q1 2024
Cash & Equivalents ($USD Millions)	$80.087	$128.886	$118.193
Accounts Receivable, net ($USD Millions)	$185.140	$178.998	$171.838
Total Assets ($USD Millions)	$1,028.497	$1,064.604	$1,085.680
Long-term Debt, net ($USD Millions)	$396.303	$396.874	$397.446

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY 2024	$925M – $965M	Withdrawn	Withdrawn
GAAP EPS	FY 2024	$2.64 – $2.77	Withdrawn	Withdrawn
Adjusted EPS	FY 2024	$4.05 – $4.20	Withdrawn	Withdrawn
GAAP EPS	Q1 2024	$0.31 – $0.35	No change; call canceled	Maintained (actual delivered within range)
Adjusted EPS	Q1 2024	$0.74 – $0.79	No change; call canceled	Maintained (actual delivered within range)

Note: No Q1 2024 earnings call or transcript; management suspended the call in light of the EQT transaction .

Topic	Previous Mentions (Q3 2023 and Q4 2023)	Current Period (Q1 2024)	Trend
AI/technology initiatives	Expanded generative AI initiatives announced in Q3 2023 ; recognized in Forrester’s AI Services Landscape Q4 2023	Hosting AI Bootcamps; recognized in Automation Fabric Services; Appian Partner Award	Continued AI emphasis and ecosystem credibility
Macro/cycle	Management referenced macro uncertainty in Safe Harbor (ongoing)	Safe Harbor reiterates macro risks (economy, FX, etc.)	Unchanged macro vigilance
Bookings/pipeline	“Solid Q4 bookings… positioned for return to growth”	“Pipeline remains robust… momentum will build through 2024”	Improving pipeline commentary
Management transitions	Jeff Davis to non-executive Chairman effective Mar 1, 2024	Leadership transition referenced among operational risks	Transition ongoing, stable governance
Regulatory/legal (M&A)	None	EQT merger details; HSR/CFIUS, shareholder vote conditions	New transformative event with regulatory path

“Our business is steadily improving and our pipeline remains robust… We are also excited to have reached the separately announced agreement with EQT, which provides our stockholders with compelling, certain cash value for their shares” — Tom Hogan, President & CEO .
Company explicitly withdrew 2024 guidance and canceled the earnings call due to the pending EQT transaction .
Q4 2023 set the tone: “Solid fourth quarter bookings have us positioned for a return to growth, particularly in the second half of 2024” .

No Q1 2024 Q&A: Perficient did not host an earnings conference call in conjunction with the Q1 2024 earnings release due to the EQT merger announcement .

Wall Street consensus estimates via S&P Global were unavailable for PRFT due to a mapping issue; therefore, “vs estimates” comparisons are not provided.

Merger drives near-term setup: $76.00 cash per share offer from EQT with standard regulatory and shareholder conditions; risk/reward now dominated by deal closure and timing .
Fundamentals softened YoY: revenue -7%, GAAP EPS -56%, adjusted EPS -26%, adjusted EBITDA -27% reflecting lower operating income and higher SG&A stock compensation .
Sequential moderation: revenue ($215.3M) and EPS ($0.33 GAAP) declined versus Q4 2023, suggesting caution on near-term demand/mix until merger-related uncertainty clears .
Liquidity remains adequate: $118.2M cash and equivalents; operating cash flow of $32.0M in Q1 2024 supports continuity through transaction execution .
Visibility curtailed: guidance withdrawn and call canceled reduce information flow; expect updates via proxy materials and regulatory filings until close .
Strategic positioning intact: continued recognition in AI/automation services and partner awards indicate franchise relevance post-transaction .
Trading lens: focus on regulatory milestones (HSR, CFIUS), shareholder vote, and any competing bids or litigation developments that could affect timing/spread .