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Thryv Holdings, Inc. (THRY)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue of $181.4M declined 22% YoY but beat Wall Street consensus by ~4% (actual $181.371M vs estimate $173.835M); SaaS revenue rose 50% YoY to $111.1M and reached 61% of total, marking continued mix shift to software . Revenue consensus values retrieved from S&P Global*.
  • GAAP diluted EPS was $(0.22), missing consensus of $(0.14); margin mix reflected higher SaaS growth, temporary cost allocations to SaaS in Q1, and elevated traffic costs tied to strong Marketing Center demand . EPS consensus values retrieved from S&P Global*.
  • Guidance updated: FY 2025 SaaS revenue lowered to $460.5–$471.0M (from $464.5–$474.0M), SaaS Adj. EBITDA trimmed to $67.0–$71.0M (from $69.5–$71.0M), while FY 2025 Marketing Services revenue raised to $315.0–$318.0M (corrected from $310.0–$314.0M) .
  • Key drivers: record Seasoned NRR 103%, ARPU increased to $335, and 111K SaaS clients; management emphasized a “Goldilocks” demand environment and a conservative guidance stance amid macro uncertainty and tariff risks .

What Went Well and What Went Wrong

What Went Well

  • SaaS momentum: revenue +50% YoY (ex-Keap +24%), SaaS now 61% of total; record Seasoned NRR 103% and ARPU up to $335, underscoring successful cross-sell and expansion .
  • Execution beat: “delivered both the top and bottom line guidance beat” for Q1; SaaS adjusted gross margin expanded ~490 bps YoY to 73% and SaaS Adj. EBITDA of $10.8M exceeded guidance .
  • Strategic integration: Keap partner channel energized; partners eager to sell full Thryv catalog, with product improvements and API hooks unveiled at Partnerkon; cultural integration progressing with low turnover .

What Went Wrong

  • Consolidated profitability: total revenue down 22% YoY to $181.4M; GAAP diluted EPS $(0.22) vs +$0.22 in Q1 2024 as Marketing Services continued to decline (–56% YoY) during strategic exit transition .
  • Temporary cost headwind: Q1 reflected $2–$3M shared cost allocation shift into SaaS due to fewer print publications; elevated traffic costs (TAC) from stronger-than-expected Marketing Center demand pressured margins .
  • FY guidance trimmed for SaaS: conservative stance reduced FY 2025 SaaS revenue and low-end SaaS Adj. EBITDA, citing macro/tariff uncertainties despite solid current demand .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$179.852 $186.596 $181.371
Diluted EPS ($USD)$(2.65) $0.19 $(0.22)
Adjusted EBITDA ($USD Millions)$19.623 $29.380 $20.901
Gross Margin % (Consolidated GAAP)62.3% 65.9% 65.8%
Adjusted Gross Margin % (Consolidated)65.0% 68.5% 68.2%
Metric vs EstimatesQ3 2024Q4 2024Q1 2025
Revenue Consensus Mean ($USD Millions)*$179.681$183.018$173.835
Revenue Actual ($USD Millions)$179.852 $186.596 $181.371
Primary EPS Consensus Mean ($USD)*$(1.185)$(0.152)$(0.140)
GAAP Diluted EPS ($USD)$(2.65) $0.19 $(0.22)

Values retrieved from S&P Global*.

Segment Breakdown

Segment MetricQ3 2024Q4 2024Q1 2025
SaaS Revenue ($USD Millions)$87.055 $104.305 $111.129
Marketing Services Revenue ($USD Millions)$92.797 $82.291 $70.242
SaaS Adjusted EBITDA ($USD Millions)$10.314 $17.276 $10.815
Marketing Services Adjusted EBITDA ($USD Millions)$9.309 $12.104 $10.086

KPIs

KPIQ3 2024Q4 2024Q1 2025
SaaS Clients (000s)96 114 total; Thryv 99 111 total; Thryv 96
SaaS ARPU ($USD)$307 $324 $335
Seasoned NRR (%)101% 98% 103%
ThryvPay TPV ($USD Millions)$82 $79 $71

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
SaaS Revenue ($USD Millions)FY 2025$464.5–$474.0 $460.5–$471.0 Lowered
SaaS Adjusted EBITDA ($USD Millions)FY 2025$69.5–$71.0 $67.0–$71.0 Lowered (low end)
Marketing Services Revenue ($USD Millions)FY 2025$310.0–$314.0 $315.0–$318.0 (corrected) Raised
Marketing Services Adjusted EBITDA ($USD Millions)FY 2025$77.5–$78.5 $77.5–$78.5 Maintained
SaaS Revenue ($USD Millions)Q2 2025N/A$113.0–$115.0 Introduced
SaaS Adjusted EBITDA ($USD Millions)Q2 2025N/A$18.5–$19.5 Introduced
Marketing Services Revenue ($USD Millions)Q2 2025$90.0–$91.0 $90.0–$91.0 Maintained
Marketing Services Revenue ($USD Millions)Q3 2025$83.0–$84.0 $83.0–$84.0 Maintained
Marketing Services Revenue ($USD Millions)Q4 2025$72.0–$73.0 $72.0–$73.0 Maintained
Marketing Services Adjusted EBITDA ($USD Millions)Q2 2025$9.0–$10.0 (Q1 reference) $24.0–$26.0 Raised sequentially (Q2 vs Q1 guide)

Note: A correction updated FY 2025 Marketing Services revenue to $315.0–$318.0 .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024)Previous Mentions (Q4 2024)Current Period (Q1 2025)Trend
Mix shift to SaaS / margin profileSaaS revenue +29% YoY; record SaaS margins; Rule of 40 achieved Record SaaS gross margin; total SaaS revenue +41% YoY SaaS is 61% of total; SaaS adj. gross margin ~73%; NRR 103% Strengthening SaaS mix and margins
Sales motion: upgrades, cross-sellPaid centers/client +12%; NDR 101% SaaS subscribers +73% YoY (incl. Keap); reiterating 2025 outlook Shift to MRR expansion; 17.2% using multiple paid products; ARPU expansion focus From subscriber adds to wallet-share growth
Keap integration & partnersKeap acquisition closed Initial integration progress Partnerkon enthusiasm; API hooks; low turnover; partner channel expansion Integration progressing; partner-led growth
Macro/tariffs toneLimited commentaryLimited commentary“Goldilocks” demand; cautious guide given uncertainty/tariffs risk Conservative outlook despite resilient demand
Marketing Services exit & cost attributionGoodwill impairment (non-cash) hit Q3 FY reiterations; MS decline timing Exit by 2028; cost allocation reversal expected Q2; 24-month print cycle Transition underway; cost normalization ahead
Leverage & liquidityNet debt/TTM leverage ranges disclosed preliminarily Balance sheet improved; pension obligations down Net debt ~$298M; leverage 2.2x; deleveraging expected H2’25 Leverage peaking near-term; improve later

Management Commentary

  • “We delivered both the top and bottom line guidance beat…SaaS revenue is now 61% of revenue…ARPU increased to $335…Seasoned net revenue retention…103%” — Joe Walsh, CEO .
  • “Q1 included a temporary headwind of approximately $2–$3M tied to shared cost allocations…This dynamic will begin to reverse in the second quarter as print revenue recognition ramps…We expect continued adjusted EBITDA margin improvements as we move through the year” — Paul Rouse, CFO .
  • “Expansion within our existing clients is one of our most compelling opportunities…when a customer adopts a second paid product, their churn rate drops significantly…we reoriented our sales organization around growing monthly recurring revenue” — Grant Freeman, President .
  • “Partners…are super excited about Thryv’s ability to help them build [the] list…we leaned into [product/API] improvements…pretty high morale” — Joe Walsh on Keap Partnerkon .
  • “We’ve taken a very conservative view…not linked to anything specific…seemed prudent to back off a smidge” — Joe Walsh on guidance .

Q&A Highlights

  • Net Revenue Retention/expansion: Management emphasized targeted plays to add centers and growth add-ons; strong NRR 103% reflects successful cross-sell and product adoption .
  • Traffic expense: Elevated TAC from stronger-than-expected Marketing Center add-ons driving search leads; a modest cost headwind acknowledged .
  • Subscriber sequential dip: Seasonal softness around holidays and deliberate focus on base expansion over net-new prospecting explained the Q/Q decline .
  • Keap partner channel: Strong enthusiasm to sell full Thryv catalog; accelerated product/API enhancements; minimal turnover post-acquisition .
  • Leverage trajectory: Net debt ~$298M, 2.2x net debt/EBITDA; plan to pay down debt and deleverage in H2’25 as timing impacts normalize .

Estimates Context

  • Q1 2025: Revenue beat — $181.371M actual vs $173.835M consensus; EPS miss — GAAP diluted $(0.22) vs $(0.14) consensus. Drivers included strong SaaS growth and NRR, offset by temporary cost allocation to SaaS and higher traffic costs from Marketing Center . Revenue/EPS consensus values retrieved from S&P Global*.
  • Trajectory: Q4 2024 also exceeded revenue consensus ($186.596M vs $183.018M) and delivered positive GAAP EPS ($0.19) versus negative consensus, while Q3 2024 revenue was roughly in line (slight beat) but EPS missed given the $83M non-cash MS goodwill impairment .

Where estimates may need to adjust:

  • FY SaaS: Management trimmed FY SaaS revenue and the low-end of SaaS Adj. EBITDA; expect consensus to reflect a more conservative SaaS growth path and mid-teens margin trajectory given TAC and cost allocations normalizing from Q2 onward .
  • Marketing Services: FY MS revenue raised; consensus likely adjusts upward for MS revenue trajectory and Q2 MS EBITDA step-up, while still modeling structural decline through the 2028 exit plan .

Key Takeaways for Investors

  • SaaS inflection intact: Majority revenue from SaaS with strong NRR and rising ARPU; focus shifting from subscriber growth to wallet-share expansion should support durable margin accretion .
  • Expect margin normalization from Q2: Temporary Q1 cost allocation headwind should reverse as print schedules ramp and the 24‑month cycle smooths cost attribution; monitor SaaS Adj. EBITDA progression through 2025 .
  • Guidance conservatism: FY SaaS lowered modestly and MS raised; read-through is prudent tone amid macro/tariff concerns rather than a demand issue, supported by “Goldilocks” SMB demand commentary .
  • Keap synergy optionality: Partner channel and automation engine broaden go-to-market, with rising API/feature velocity; watch cross-sell momentum and upmarket/vertical traction .
  • MS exit on track: Plan to exit Marketing Services by 2028 with cash flows into 2030; near-term prints drive MS EBITDA seasonality; FY 2025 guidance points to mid‑20s MS margin .
  • Balance sheet path: Net debt ~$298M and 2.2x leverage expected to peak in Q2 and delever in H2’25; track cash conversion and debt paydown cadence .
  • Near-term trading lens: Q2 print should show SaaS margin improvement and MS EBITDA uplift; catalysts include continued ARPU expansion, NRR durability, and clarity on TAC normalization .