Thryv Holdings, Inc. Reports Q1 2025 Results: A Shift Toward SaaS

In the first quarter of 2025, Thryv Holdings reported total revenues of $181.3 million, a notable decline from the $233.6 million reported in Q1 2024. This decrease of approximately 22.4% is primarily attributed to a steep drop in the Marketing Services segment, which has been undergoing a strategic phase-out as the company pivots towards its SaaS offerings.

The Thryv SaaS segment showcased impressive growth, with revenues soaring to $111.1 million in Q1 2025, up from $74.3 million in the prior year—a remarkable increase of 49.5%. This growth is driven by the flagship Thryv® platform, which integrates essential tools for small business management, including the Command Center and ThryvPay®. The transition of clients from the declining Marketing Services to the SaaS platform is evident, as approximately 44,000 clients were converted over the past twelve months, contributing to a substantial increase in SaaS revenues.

Conversely, the Thryv Marketing Services segment experienced a significant revenue decline, generating only $70.2 million in Q1 2025, compared to $159.3 million in Q1 2024. This downtrend is consistent with the company’s strategic decision to phase out traditional marketing solutions by the end of 2028, compounded by a general decline in the print media industry.

The net income for Q1 2025 reflected a loss of $9.61 million, a stark contrast to the net income of $8.42 million reported in Q1 2024. The decrease in profitability is largely driven by increased costs and the decline in revenue from Marketing Services. Operating income fell to -$3.03 million, highlighting the challenges faced in maintaining profitability amid the transition to a SaaS-focused model.

Despite the downturn in revenue, Thryv Holdings managed to reduce its cost of services by $17.9 million, reflecting strategic cost-saving initiatives amid a challenging market environment. The gross margin remained stable at 65.8%, indicating effective cost management despite reduced revenues. Operating expenses, primarily in sales and marketing, did not see significant fluctuations, emphasizing the company's commitment to maintaining its growth trajectory.

As of March 31, 2025, Thryv Holdings reported total assets of $703.7 million, with total liabilities amounting to $510.5 million, resulting in a total equity of $193.2 million. The company's structured approach to managing debt includes a Term Loan and an ABL Facility, established in May 2024. Thryv is currently in compliance with all covenants, indicating a stable financial footing despite the recent operational challenges.

The cash flow statement for Q1 2025 revealed a net change in cash of -$5.30 million, influenced by a negative net cash from operating activities of -$10.48 million. The company saw a positive cash flow from financing activities, which totaled $12.27 million, driven by repayments of debt.

Looking ahead, Thryv Holdings is committed to expanding its SaaS segment while managing its Marketing Services operations prudently. Recent strategic acquisitions, such as the purchase of Keap, are expected to enhance Thryv's offerings and client base. The company has also launched a share repurchase program, authorized for up to $40 million, reflecting confidence in its long-term strategy.

Thryv Holdings, Inc. is currently navigating a transformative period characterized by a shift from traditional marketing services to a robust SaaS offering. While the Q1 2025 results reflect significant challenges, the growth in the SaaS segment and strategic initiatives aimed at enhancing client services showcase the company's commitment to innovation and value delivery for small-to-medium-sized businesses. As Thryv continues to adapt to the evolving market landscape, its focus on customer experience and operational efficiency will be critical in driving future growth.