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Thryv Holdings, Inc. (THRY)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025: SaaS momentum and profitability accelerated; consolidated revenue rose to $210.5M with diluted EPS $0.31, while consolidated Adjusted EBITDA margin expanded to 24.3% on stronger print and SaaS scale .
  • Revenue and EPS beat Wall Street consensus, with revenue at $210.5M vs ~$203.9M* and diluted EPS $0.31 vs ~$0.26*, driven by record SaaS Adjusted EBITDA margin (20.3%) and a normalization of shared cost allocations back to Marketing Services .
  • Guidance raised: FY25 SaaS Adjusted EBITDA to $70.5–$73.5, Marketing Services revenue to $323–$325M and Adjusted EBITDA to $78.5–$80.5; FY25 SaaS revenue narrowed to $460–$465M .
  • Catalysts: “pinch point” behind them, debt amortization stepped down, potential buybacks discussed, and vertical solutions (HVAC) plus Workforce Center launch support ARPU expansion and multi-product adoption .

What Went Well and What Went Wrong

What Went Well

  • Record SaaS profitability: SaaS Adjusted EBITDA reached $23.4M (20.3% margin), reflecting improved gross margins (74.0%) and scale efficiencies; management highlighted beat vs guidance and “highest SaaS Adjusted EBITDA margin to date” .
  • Estimates beat: Consolidated revenue and diluted EPS beat Street; revenue $210.5M vs ~$203.9M*, EPS $0.31 vs ~$0.26*, aided by strong print normalizing allocations and >100% seasoned NRR (103%) .
  • Strategic execution: Pinch point past; leverage positioned to decline as FCF ramps; debt amortization reduced and paid ahead to Q2 2026; management now considering offensive investments and buybacks (“mispriced share price”) .

Quote: “We delivered a solid second quarter – exceeding our prior guidance and achieving strong top-line SaaS growth coupled with our highest SaaS Adjusted EBITDA margin to date” – Joe Walsh, CEO .

What Went Wrong

  • Marketing Services decline continues by design: revenue down 35% YoY to $95.5M as legacy products are upgraded to SaaS; billings down 38% YoY, consistent with managed exit by 2028 .
  • Keap demand-gen pullback: Thryv curtailed less-profitable Keap direct demand generation to protect cash during the pinch point; near-term organic growth appears conservative despite ARPU gains .
  • Mix/allocations volatility: Management cautioned SaaS margins will not hold at 20% each quarter due to print timing; allocations shift back towards SaaS in lighter print quarters, weighing near-term margins .

Financial Results

MetricQ4 2024Q1 2025Q2 2025
Revenue ($USD Millions)$186.6 $181.4 $210.5
Diluted EPS ($USD)$0.19 $(0.22) $0.31
Consolidated Adjusted EBITDA ($USD Millions)$29.4 $20.9 $51.2
Adjusted EBITDA Margin (%)15.7% 11.5% 24.3%
Gross Profit ($USD Millions)$123.0 $119.3 $146.6
Gross Margin (%)65.9% 65.8% 69.7%
Net Income ($USD Millions)$7.9 $(9.6) $13.9
Net Income Margin (%)4.2% (5.3)% 6.6%
Segment MetricQ4 2024Q1 2025Q2 2025
SaaS Revenue ($USD Millions)$104.3 $111.1 $115.0
Marketing Services Revenue ($USD Millions)$82.3 $70.2 $95.5
SaaS Adjusted EBITDA ($USD Millions)$17.3 $10.8 $23.4
Marketing Services Adjusted EBITDA ($USD Millions)$12.1 $10.1 $27.8
SaaS Adjusted Gross Margin (%)75.9% 73.3% 74.0%
Marketing Services Adjusted Gross Margin (%)59.2% 60.1% 68.6%
KPIQ4 2024Q1 2025Q2 2025
SaaS Subscribers (000s)114 111 106
SaaS Subscribers ex Keap (000s)99 96 92
Seasoned NRR (%)98% 103% 103%
ARPU ($/month)$324 $335 $352
ThryvPay TPV ($USD Millions)$79 $71 $90

Q2 2025 vs Estimates (S&P Global):

  • Revenue: Consensus ~$203.9M* vs Reported $210.5M .
  • EPS (Primary EPS): Consensus ~$0.26* vs Reported diluted EPS $0.31 .
    Values retrieved from S&P Global.*

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
SaaS Revenue ($M)FY 2025$460.5–$471.0 $460.0–$465.0 Narrowed (lower top end)
SaaS Adjusted EBITDA ($M)FY 2025$67.0–$71.0 $70.5–$73.5 Raised
Marketing Services Revenue ($M)FY 2025$315.0–$318.0 $323.0–$325.0 Raised
Marketing Services Adjusted EBITDA ($M)FY 2025$77.5–$78.5 $78.5–$80.5 Raised
Marketing Services Revenue ($M)Q3 2025$83.0–$84.0 $84.0–$85.0 Raised
Marketing Services Revenue ($M)Q4 2025$72.0–$73.0 $73.0–$74.0 Raised
SaaS Revenue ($M)Q3 2025NA$116.0–$117.0 New
SaaS Adjusted EBITDA ($M)Q3 2025NA$18.5–$19.5 New
Marketing Services Adjusted EBITDA ($M)Q3 2025NA$22.0–$23.0 New
Marketing Services Adjusted EBITDA ($M)Q4 2025NA$18.5–$19.5 New

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
Vertical solutions (HVAC)Emphasis on multi-center adoption and PLG initiatives; partner channel optimism Launch of Thryv for HVAC; upcharge for automation package; early traction; partnering with back-office vendors Expanding verticalization; ARPU uplift
Capital allocation & deleveragingProactive term loan prepayment; leverage expected to peak H1’25 then delever “Pinch point” passed; amortization stepped down; buybacks under consideration; CFO focused on further deleveraging Balance sheet strengthening; optionality rising
Keap integration & demand genInitial integration; $10M cost synergies crystallized Pullback on less-profitable Keap demand gen; revenue synergies via Thryv sales and partners expected later Near-term revenue tempering; margin-focused
ARPU expansion & multi-productARPU $324; multi-product adoption rising ARPU $352; 19% clients multi-product; NRR 103% Improving monetization and retention
Product launchesReporting Center PLG motion (Q4) Workforce Center (payroll) launched; embedded via Gusto; churn-reducing add-on Broader platform; stickier clients
Market classificationNo mentionManagement pressing for GICS reclassification into Software (currently misclassified under Advertising) Potential index/peer visibility catalyst

Management Commentary

  • “We did it. We made it through the pinch point… from this point forward… leverage is positioned to decline… we’re going to begin to actually develop a little bit of leftover free cash flow” – Joe Walsh (CEO) .
  • “SaaS reported revenue was $115 million… Keap contributed $17.7 million… SaaS adjusted gross margin increased 430 bps YoY… record adjusted EBITDA margin of 20%” – Paul Rouse (CFO) .
  • “Modest adjustment in SaaS guidance has isolated softness in the Keap business… we increased our SaaS EBITDA target… we are delivering where it counts” – Joe Walsh (CEO) .
  • “With strong print quarters expected ahead, we anticipate leverage to step down significantly as revenue recognition ramps and cash flow improves” – Paul Rouse (CFO) .

Q&A Highlights

  • Vertical strategy: HVAC automations are an upcharge; expected to lift ARPU, improve retention, and support offense/defense in the segment; more verticals in pipeline .
  • Estimates/guidance tone: CEO emphasized conservatism in outlook; no specific business worry flagged despite cautious assumptions .
  • Keap trajectory: Pulled back low-LTV direct demand-gen to prioritize ROI and debt repayment; strong synergy capture; revenue synergies to come via Thryv sales and partner channel into 2026–2027 .
  • Capital allocation: Buybacks “on the table” given mispricing; CFO reiterates deleveraging focus .
  • Margin cadence: SaaS margins will vary with print timing as allocations shift; don’t extrapolate 20% every quarter .

Estimates Context

  • Q2 2025 results vs consensus: Revenue $210.5M vs ~$203.9M*; diluted EPS $0.31 vs ~$0.26* .
  • Q3 2025 Street snapshot: Revenue ~$200.8M*, EPS $0.25*; compares to company segment guidance of SaaS $116–$117M and Marketing Services $84–$85M ($200–$202M total) .
    Values retrieved from S&P Global.*

Note: S&P “Primary EPS” may differ from company-reported diluted EPS due to normalization methodology.

Key Takeaways for Investors

  • Transition inflection: Pinch point is behind them; leverage and FCF set to improve into H2’25, creating optionality (including buybacks) .
  • SaaS quality improving: Record SaaS margins and rising ARPU/NRR underscore scaling profitability; multi-product adoption at 19% supports durable expansion .
  • Managed MS run-off: Continued YoY declines in Marketing Services reflect deliberate conversion; strengthens SaaS mix and visibility over time .
  • Keap integration strategy: Near-term demand-gen pullback trades revenue for profitability; expect revenue synergies via Thryv’s channels and partner ecosystem in 2026–2027 .
  • Guidance upgrade: FY25 raises in SaaS EBITDA and MS revenue/EBITDA, with FY SaaS revenue narrowed, signal execution confidence and margin discipline .
  • Product catalysts: HVAC vertical and Workforce Center enhance stickiness and ARPU, supporting sustained NRR above 100% .
  • Narrative drivers: Potential GICS reclassification to Software could broaden investor awareness and peer comp set, a non-fundamental but meaningful visibility catalyst .