8-K: Thryv Soars with 33% SaaS Revenue Growth in Q3 2025

Thryv Holdings, Inc. reported robust third-quarter 2025 results, driven by a 33% year-over-year increase in SaaS revenue and a significant return to net income.

Summary

• SaaS revenue increased by 33% year-over-year to $115.9 million in Q3 2025.
• Consolidated total revenue grew 12% year-over-year to $201.6 million.
• The company achieved a consolidated net income of $5.7 million, or $0.13 per diluted share, a substantial improvement from a net loss of $96.1 million in Q3 2024.
• Consolidated Adjusted EBITDA rose 108.1% year-over-year to $40.8 million, with a margin of 20.3%.
• SaaS Adjusted EBITDA increased 89.9% to $19.6 million, exceeding guidance.
• SaaS clients grew 7% year-over-year to 103 thousand.
• SaaS monthly Average Revenue per Unit (ARPU) expanded 19% year-over-year to $365.
• ThryvPay total payment volume reached $89 million, up 9% year-over-year.
• Generated Q3 operating cash flow of $22 million and free cash flow of $14.6 million.
• Marketing Services revenue decreased 8% year-over-year to $85.7 million.
• Full year 2025 SaaS revenue is projected to increase 34% to 35%, reaching $460.0 million to $463.0 million.
• Full year 2025 total company revenue is expected to decline 4% to 5%, ranging from $783.0 million to $788.0 million.

Sentiment

Score: 8

Explanation: The sentiment is highly positive due to strong SaaS revenue growth, a significant return to net income, substantial increases in Adjusted EBITDA, and positive cash flow generation. The management's strategic focus on increasing customer spend and leveraging AI is yielding results. While Marketing Services revenue continues to decline, the robust performance of the SaaS segment and overall profitability improvement outweigh this, positioning the company favorably.

Positives

• SaaS revenue surged 33% year-over-year to $115.9 million in Q3 2025, demonstrating strong growth in the core software business.
• Consolidated net income of $5.7 million marks a significant turnaround from a $96.1 million net loss in the prior year's quarter.
• Consolidated Adjusted EBITDA more than doubled, increasing 108.1% to $40.8 million, indicating improved operational efficiency and profitability.
• SaaS Adjusted EBITDA grew 89.9% to $19.6 million, surpassing the company's guidance.
• SaaS client base expanded by 7% year-over-year to 103 thousand, reflecting successful customer acquisition.
• SaaS monthly ARPU increased by 19% year-over-year to $365, showing increased customer spend and value.
• The company generated positive operating cash flow of $22.2 million and free cash flow of $14.6 million in Q3 2025, contributing to a stronger balance sheet.
• Management's strategy to increase customer spend is proving effective, supported by ARPU expansion and leveraging AI for small business growth.

Negatives

• Marketing Services revenue declined 8% year-over-year to $85.7 million in Q3 2025, continuing a trend of contraction in this segment.
• Nine months ended September 30, 2025, consolidated total revenue decreased 6.9% to $593.4 million compared to the same period in 2024.
• Nine months ended September 30, 2025, consolidated Adjusted EBITDA decreased 15.1% to $113.0 million compared to the same period in 2024, primarily due to the larger decline in Marketing Services EBITDA.
• Full year 2025 Marketing Services revenue is projected to decline approximately 32% to 33%, indicating ongoing challenges in this segment.

Risks

• Significant competition exists for Marketing Services solutions and SaaS offerings, including from companies using third-party SaaS components.
• Ability to maintain profitability is crucial for sustained success.
• Effective management of growth is necessary to avoid operational strains.
• Challenges in transitioning Marketing Services clients to the Thryv platform, retaining them, and upselling additional products.
• Potential for internet search engines and portals to terminate or materially alter agreements with the company.
• The company must keep pace with rapid technological changes and evolving industry standards.
• SMB clients may opt not to renew agreements or renew at lower spend levels.
• Risk of system interruptions or failures, including cybersecurity breaches, identity theft, data loss, or unauthorized access.
• Potential failure to identify and successfully integrate suitable acquisition candidates, including the Keap acquisition.
• Loss of key employees or inability to attract and retain highly skilled personnel could impact operations.
• Maintaining compatibility of the Thryv platform with third-party applications is essential.
• Challenges in successfully expanding operations and offerings into new markets, including internationally.
• Potential failure to provide new or enhanced functionality and features on the platform.
• Non-compliance with applicable privacy, security, and data laws, regulations, and standards could lead to penalties.
• Changes in regulations governing privacy concerns and data protection could impact business operations.
• Failure to meet service level commitments under client contracts could result in reputational damage and financial penalties.
• Inability to offer high-quality or technical support services could lead to customer dissatisfaction.
• The Thryv platform and add-ons may fail to perform properly, affecting customer experience.
• The use of artificial intelligence (AI) in the business carries risks of reputational harm, competitive harm, and legal liability if not properly managed.
• Potential impact of future labor negotiations on operational costs and stability.
• Inability to protect intellectual property rights, proprietary technology, information, processes, and know-how.
• Rising inflation and the company's ability to control costs, including operating expenses.
• General macro-economic conditions, including a recession or economic slowdown, could adversely affect demand.
• Adverse tax laws or regulations or potential changes to existing tax laws could impact financial results.
• Costs, liabilities, and reputational harm may arise from regulatory investigations, including a subpoena from the SEC's Division of Enforcement.
• Volatility and weakness in bank and capital markets could affect financing and liquidity.
• Costs, obligations, and liabilities incurred as a result of being a public company.

Future Outlook

Thryv is providing guidance for Q4 2025 and full year 2025. For the full year, SaaS revenue is projected to increase 34% to 35% to a range of $460.0 million to $463.0 million, with SaaS Adjusted EBITDA margins in the mid-teens. Marketing Services revenue is expected to decline approximately 32% to 33% to a range of $323.0 million to $325.0 million, with mid-twenties EBITDA margins. Total company revenue for the full year is anticipated to decline 4% to 5%, reaching $783.0 million to $788.0 million, with overall Adjusted EBITDA margins just under 20%.

Management Comments

• Joe Walsh, Thryv Chairman and CEO, stated: "We reported strong third quarter results achieving 33% year-over-year SaaS growth while exceeding our SaaS Adjusted EBITDA guidance."
• Joe Walsh highlighted: "Our 2025 strategy to increase customer spend is working, evidenced by ARPU expanding 19% year-over-year."
• Joe Walsh noted: "We have been deepening relationships with our existing customers and are capitalizing on the opportunities AI gives our team to power small business growth."
• Joe Walsh emphasized: "In addition, we continued to generate free cash flow, pay down debt and deleverage our business, positioning us with a stronger balance sheet."

Industry Context

Thryv operates in the competitive small business software and marketing services industry. The strong growth in its SaaS segment, particularly with increased ARPU and client acquisition, indicates successful adaptation to the digital transformation needs of SMBs. The decline in Marketing Services revenue reflects a broader industry trend of shifting away from traditional marketing channels towards digital solutions. The company's focus on AI integration aligns with current technological advancements aimed at enhancing efficiency and effectiveness for small businesses.

Comparison to Industry Standards

• Thryv's 33% year-over-year SaaS revenue growth is robust and generally outperforms many established SaaS companies, especially given its focus on the SMB market which can be fragmented but offers significant growth potential.
• The 19% year-over-year increase in SaaS monthly ARPU to $365 suggests effective monetization strategies and customer value, which compares favorably to many SMB-focused software providers that often struggle with lower ARPU due to price sensitivity.
• A Seasoned Net Revenue Retention (NRR) of 94% indicates a healthy retention rate for its core SaaS clients, though some leading SaaS companies in less price-sensitive enterprise markets often achieve NRR above 100%, implying significant expansion within existing accounts. For the SMB segment, 94% is a solid performance.
• The decline in Marketing Services revenue is consistent with the broader industry shift from traditional print and directory services to digital platforms, a trend seen across legacy marketing providers. Thryv's ability to offset this decline with SaaS growth is a key differentiator.

Legal Proceedings

• The company faces potential costs, liabilities, and reputational harm resulting from regulatory investigations, including a subpoena from the Division of Enforcement of the Securities and Exchange Commission (SEC).

Related Party Transactions

• Interest expense, related party, amounted to $2.751 million for Q3 2025 and $8.728 million for the nine months ended September 30, 2025.
• The Term Loan, net, related party, was $88.764 million as of September 30, 2025.

Stakeholder Impact

• Shareholders are positively impacted by the significant improvement in net income, strong SaaS growth, and increased Adjusted EBITDA, which could lead to improved stock performance.
• Customers (SMBs) benefit from the company's focus on deepening relationships, increasing ARPU, and leveraging AI to power small business growth, suggesting enhanced product offerings and support.
• Creditors are positively impacted by the company's generation of free cash flow and efforts to pay down debt and deleverage the business, indicating improved financial health and reduced risk.
• Employees may experience ongoing restructuring and integration efforts, as indicated by related expenses, which could lead to workforce adjustments, though no specific details were provided.

Next Steps

• Thryv will host a conference call on October 30, 2025, to discuss the Q3 2025 results.
• The company will continue to execute its 2025 strategy to increase customer spend and capitalize on AI opportunities.
• Ongoing efforts to generate free cash flow, pay down debt, and deleverage the business are expected.

Key Dates

Recommendation

The filing presents a compelling case for a 'strong buy' recommendation. Thryv's core SaaS business is demonstrating exceptional growth, with a 33% year-over-year revenue increase and a substantial 89.9% rise in SaaS Adjusted EBITDA, exceeding guidance. The company has successfully returned to consolidated net income, a significant turnaround from the prior year's loss, and is generating strong free cash flow, which is being used to pay down debt and strengthen the balance sheet. The expansion of SaaS clients and ARPU indicates effective customer acquisition and monetization strategies, further bolstered by the strategic integration of AI. While the Marketing Services segment continues its expected decline, the robust performance and positive outlook for the higher-margin SaaS segment clearly position Thryv for future value creation. The overall financial health and strategic direction are highly favorable for investors.

Keywords

SaaS, Small Business Software, Marketing Services, Thryv, Earnings, Q3 2025, Financial Results, Adjusted EBITDA, ARPU, Client Growth, ThryvPay, SEC Filing, Software Platform, SMB