8-K/A: Thryv Holdings Reports Strong Q1 2025 SaaS Revenue Growth, Exceeds Guidance

Thryv Holdings' SaaS revenue surges 50% year-over-year in Q1 2025, driven by strategic transformation and customer relationship deepening.

Summary

• Thryv Holdings reported a 50% year-over-year increase in SaaS revenue for the first quarter of 2025, reaching $111.1 million.
• Excluding Keap, SaaS revenue grew by 24% year-over-year to $92.2 million.
• Total consolidated revenue decreased by 22% year-over-year to $181.4 million.
• The company experienced a net loss of $9.6 million, or $(0.22) per diluted share, compared to a net income of $8.4 million, or $0.22 per diluted share, in Q1 2024.
• Consolidated Adjusted EBITDA was $20.9 million, with an Adjusted EBITDA margin of 11.5%.
• SaaS Adjusted EBITDA was $10.8 million, representing a margin of 9.7%.
• Marketing Services revenue decreased by 56% year-over-year to $70.2 million.
• Seasoned Net Revenue Retention (NRR) reached a record 103% in Q1 2025.
• SaaS clients increased by 59% year-over-year to 111,000.
• ThryvPay total payment volume increased by 13% year-over-year to $71 million.
• The company forecasts SaaS revenue between $460.5 million and $471.0 million for the full year 2025.
• Marketing Services revenue is projected to be between $315.0 million and $318.0 million for the full year 2025.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive due to strong SaaS revenue growth and record NRR, but tempered by a net loss and decline in overall revenue. The company's strategic shift towards SaaS is promising, but challenges remain in managing costs and integrating acquisitions.

Positives

• Significant growth in SaaS revenue, indicating a successful strategic shift towards software solutions.
• Record Seasoned Net Revenue Retention of 103%, demonstrating strong customer loyalty and upselling capabilities.
• Increase in SaaS clients, reflecting successful customer acquisition and platform adoption.
• Growth in ThryvPay payment volume, indicating increased platform usage and transaction activity.
• The company exceeded its guidance for the first quarter of 2025.

Negatives

• Consolidated total revenue decreased by 22% year-over-year, primarily due to a decline in Marketing Services revenue.
• The company reported a net loss of $9.6 million for Q1 2025, compared to a net income in Q1 2024.
• Marketing Services revenue decreased significantly by 56% year-over-year.

Risks

• Intense competition in both Marketing Services and SaaS markets.
• The company's ability to manage growth effectively.
• The risk of clients not renewing agreements or renewing at lower spend.
• Potential system interruptions or cybersecurity breaches.
• The company's ability to successfully integrate acquisitions, including Keap.
• The potential loss of key employees.
• Rising inflation and the ability to control costs.
• General macro-economic conditions, including a recession or an economic slowdown.

Future Outlook

Thryv expects to deliver SaaS revenue growth and continued SaaS Adjusted EBITDA margin improvement for the remainder of 2025. The company provided guidance for Q2 2025 and full year 2025, including SaaS revenue, SaaS Adjusted EBITDA, and Marketing Services revenue.

Management Comments

• Joe Walsh, Thryv Chairman and CEO, stated that Thryv started 2025 with strong positive momentum as SaaS revenue accelerated to over 60% of total revenue.
• Joe Walsh, Thryv Chairman and CEO, stated that the company is focused on acquiring and upgrading subscribers to the platform, deepening relationships with existing customers, and expanding ARPU.
• Paul Rouse, Chief Financial Officer, stated that the company exceeded its guidance in the first quarter and balanced SaaS top-line growth with disciplined cost management.
• Paul Rouse, Chief Financial Officer, stated that the company expects to deliver SaaS revenue growth and continued SaaS Adjusted EBITDA margin improvement for the remainder of 2025.

Industry Context

Thryv's focus on SaaS revenue growth aligns with the broader industry trend of businesses increasingly adopting cloud-based software solutions. The company's efforts to deepen customer relationships and expand ARPU are crucial in a competitive market where customer retention and value maximization are key drivers of success. The acquisition of Keap is a strategic move to expand its SaaS offerings and customer base.

Comparison to Industry Standards

• Comparing Thryv's SaaS revenue growth of 50% year-over-year to companies like HubSpot (which has seen consistent growth in the 20-30% range) indicates a strong performance.
• The NRR of 103% is competitive with industry leaders like Zoom and Twilio, which often report NRR figures above 100%.
• Thryv's focus on SMBs positions it against companies like Intuit and Square, which also target this market with integrated software and payment solutions.
• The Adjusted EBITDA margin of 11.5% is lower than some established SaaS companies, but reflects Thryv's ongoing investments in growth and platform development.

Stakeholder Impact

• Shareholders may experience mixed reactions due to strong SaaS growth but an overall net loss.
• Employees in the SaaS division may see increased opportunities due to growth in that segment.
• Customers will benefit from continued investment in the Thryv platform and enhanced features.
• Suppliers may see shifts in demand as the company focuses more on SaaS-related services.

Next Steps

• The company will continue to focus on acquiring and upgrading subscribers to the Thryv platform.
• Thryv will deepen relationships with existing customers and expand ARPU through cross-selling and product enhancements.
• The company will continue to invest in its platform to drive sustainable, profitable growth.

Key Dates

Keywords

SaaS, Marketing Services, Revenue, EBITDA, Net Revenue Retention, Thryv, Keap, ARPU, ThryvPay