Key Takeaways TaskUs' Q3 adjusted EPS of $0.42 beat estimates and rose 13.5% year over year. Revenues grew 17% to $298.7M, led by 60% AI Services growth and 20% Trust & Safety gains. Full-year 2025 revenue outlook set at $1.173-$1.175B, implying 18% year-over-year growth. TaskUs (TASK) reported third-quarter 2025 adjusted earnings of 42 cents per share, which beat the Zacks Consensus Estimate by 16.67%. The figure increased 13.5% year over year.Revenues of $298.7 million beat the consensus mark by 3.25% and ...

Digital outsourcing company TaskUs (NASDAQ:TASK) reported revenue ahead of Wall Streets expectations in Q3 CY2025, with sales up 17% year on year to $298.7 million. Revenue guidance for the full year exceeded analysts’ estimates, but next quarter’s guidance of $303.4 million was less impressive, coming in 1.4% below expectations. Its non-GAAP profit of $0.42 per share was 10.4% above analysts’ consensus estimates. Is now the time to buy TASK? Find out in our full research report (it’s free for active Edge ...

Revenue and Income - Service revenue for the nine months ended September 30, 2025, was $870,591, a 20.8% increase from $720,743 in 2024[118] - Operating income increased by 45.5% to $102,541 for the nine months ended September 30, 2025, compared to $70,474 in 2024[118] - Net income for the nine months ended September 30, 2025, was $72,570, reflecting a 96.1% increase from $37,011 in 2024[118] - AI Services revenue increased by 63.7% to $156,701 for the nine months ended September 30, 2025, from $95,716 in 2024[119] - Adjusted Net Income for Q3 2025 was $38,990,000, representing a 13.7% increase from $34,277,000 in Q3 2024[136] - Net income for Q3 2025 was $31,375,000, a significant increase of 147.1% compared to $12,699,000 in Q3 2024[136] - Adjusted Net Income for the nine months ended September 30, 2025 was $114,625,000, a 27.1% increase from $90,184,000 in the same period of 2024[140] - Net income for the nine months ended September 30, 2025 was $72,570,000, a 96.1% increase from $37,011,000 in 2024[140] Expenses and Costs - Cost of services increased by 24.0% to $537,169 for the nine months ended September 30, 2025, from $433,052 in 2024[118] - Financing expenses decreased by 15.8% to $13,925 for the nine months ended September 30, 2025, compared to $16,532 in 2024[128] - Stock-based compensation expense decreased by 39.4% in Q3 2025 to $6,513,000 from $10,742,000 in Q3 2024[136] - The company incurred $11,993,000 in transaction costs for the nine months ended September 30, 2025, a 100% increase from zero in 2024[140] Tax and Margins - The effective tax rate for the nine months ended September 30, 2025, was 26.3%, down from 33.8% in 2024[129] - Net Income Margin improved to 10.5% in Q3 2025 from 5.0% in Q3 2024[136] Cash Flow and Indebtedness - Free Cash Flow decreased to $63.8 million from $79.4 million in 2024, with a conversion rate of Adjusted EBITDA to Free Cash Flow at 34.0%[159] - As of September 30, 2025, total cash and cash equivalents were $210.0 million, with an additional borrowing capacity of $190.0 million under the 2022 Revolving Credit Facility[160] - Total indebtedness as of September 30, 2025, was $246.3 million, with an interest rate of 6.352% per annum[161] - Net cash provided by operating activities increased to $107.5 million from $98.2 million in 2024, driven by higher net income and non-cash charges[166] - Net cash used in investing activities rose to $43.8 million, primarily due to increased site build-out and technology costs[167] - Net cash used in financing activities increased to $39.5 million, attributed to share repurchases and higher long-term debt payments[168] Client Contribution and Strategy - The top ten clients contributed 60% of total service revenue for the three months ended September 30, 2025, compared to 56% in 2024[130] - The company plans to target high growth industry verticals and clients to achieve meaningful client and revenue diversification over time[131] EBITDA and Adjusted Metrics - Adjusted EPS for Q3 2025 was $0.42, up from $0.37 in Q3 2024, reflecting a growth of 13.5%[146] - Adjusted EBITDA for Q3 2025 reached $63,452,000, marking a 17.0% increase from $54,215,000 in Q3 2024[150] - EBITDA for the same period was $157.8 million, reflecting a 33.8% increase from $118.0 million in 2024[154] - Adjusted EBITDA increased by 20.2% to $187.7 million compared to $156.1 million in 2024[154] Foreign Currency and Other Gains - Foreign currency losses for Q3 2025 were $(6,678,000), compared to gains of $2,490,000 in Q3 2024, indicating a significant negative shift[136] Share Repurchase - The company repurchased 2,112,247 shares for $27.7 million during the nine months ended September 30, 2025[162]

Financial Data and Key Metrics Changes - In Q3 2025, the company achieved record revenue of $298.7 million, reflecting a 17% year-over-year growth rate [8][20] - Adjusted EBITDA for the quarter was $63.5 million, resulting in an adjusted EBITDA margin of 21.2% [8][24] - Adjusted earnings per share (EPS) was $0.42, representing approximately 14% year-over-year growth [8][25] - The company ended the quarter with $210 million in cash and a net debt-to-adjusted EBITDA ratio of less than 0.2 times [8][26] Business Line Data and Key Metrics Changes - The Digital Customer Experience (DCX) service line saw single-digit year-over-year growth of approximately 6%, with revenue of $164.2 million [13][23] - Trust and Safety revenue increased by 19.1% year-over-year, driven by the social media vertical, totaling $75.8 million [13][23] - AI Services experienced significant growth of 60.8% year-over-year, resulting in $58.7 million in revenue [15][24] Market Data and Key Metrics Changes - Revenue from clients outside the top 20 grew approximately 6% year-over-year, while revenue from the top 10 and top 20 clients represented 60% and 71% of total revenue, respectively [21][22] - The company generated 54% of its revenues in the Philippines, 13% in India, 11% in the United States, and 22% from the rest of the world [22] Company Strategy and Development Direction - The company plans to shift from selling time-based services to selling solutions that combine technology and talent, focusing on AI consulting and services [9][11] - Investments will be significantly increased in agentic AI consulting and AI services, with a focus on automation and efficiency [9][11] - The company aims to enhance shareholder returns while pursuing a capital allocation strategy that supports long-term growth [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the slowing growth in the BPO industry but emphasized the company's strong performance relative to competitors due to operational excellence [9][12] - The company expects full-year 2025 revenue between $1.173 billion and $1.175 billion, representing approximately 18% year-over-year growth [17][27] - For Q4, the company anticipates revenue of $302 million to $304 million, reflecting approximately 11% year-over-year growth [17][28] Other Important Information - The proposed take-private transaction was terminated due to insufficient shareholder approval, which management views as a testament to high valuation expectations [5][6] - The company is committed to maintaining a strong balance sheet while investing in AI transformation initiatives [48] Q&A Session Summary Question: Plans operationally post-take-private transaction - Management plans to follow a strategy similar to what would have been pursued as a private company, focusing on AI transformation and investments in agentic AI consulting [33] Question: Outlook for sequential growth in Q4 - Management expects 11% year-over-year growth in Q4, with 9% growth when excluding the largest client, due to challenging comparisons from the previous year [38] Question: Sustainability of AI services growth - Management is confident that AI services will sustain double-digit growth over the long term, despite project-based revenue fluctuations [49] Question: Durability of spend from the largest customer - The relationship with the largest customer remains strong, with continued growth expected, although the pace may not match the previous year [52] Question: Investment strategy and its impact on P&L - Management indicated that they are still in the early stages of their investment cycle, with significant improvements in internal processes already observed [55]

Financial Performance Highlights - TaskUs achieved a record quarterly revenue of approximately $298.7 million in Q3 2025, representing a 17% year-over-year growth[7,9,10] - Adjusted EBITDA for Q3 2025 was approximately $63.5 million, with an Adjusted EBITDA Margin of 21.2%[7,9,10] - The company's revenue for the year 2024 was $995 million, a 7.6% increase year-over-year, with an Adjusted EBITDA Margin of 21.1%[68] - TaskUs projects revenue between $302.4 million and $304.4 million for Q4 2025 and between $1.173 billion and $1.175 billion for the full year, representing a year-over-year growth of 10.6% and 18% respectively[70] - The company anticipates an Adjusted EBITDA Margin of approximately 19.8% for Q4 2025 and approximately 21.1% for the full year, along with an Adjusted Free Cash Flow of around $100 million for the full year[70] Service Line Growth - Trust + Safety and AI Services (AIS) demonstrated strong double-digit year-over-year growth in Q3 2025, with nearly 20% and over 60% growth, respectively[7,10] - Revenue from clients utilizing multiple service lines grew by more than 20% year-over-year in Q3 2025[7,10] - AI Services contributed 17% to the trailing twelve-month (TTM) Q3 2025 revenue, amounting to $196 million[18,29] - Digital Customer Experience accounted for 57% of the TTM Q3 2025 revenue, totaling $654 million[18,23] - Trust + Safety represented 26% of the TTM Q3 2025 revenue, reaching $295 million[18,26]

NEW BRAUNFELS, Texas, November 7, 2025 — TaskUs, Inc. (Nasdaq: TASK), a leading provider of outsourced digital services and next-generation customer experience to the world's most innovative companies, today announced its results for the third quarter ended September 30, 2025. "In the third quarter of 2025, we generated record revenue of $298.7 million, a year-over-year growth rate of 17.0%, led by our third quarter in a row of more than 50% growth in AI Services. We also delivered Adjusted EBITDA margins o ...

Core Insights - The AI-driven bull run that began in 2023 and 2024 continues into 2025, with AI infrastructure developers poised for significant growth [1] - Despite the overall positive trend, several AI stocks have underperformed in 2025, presenting potential growth opportunities [2] Company Summaries Five9 Inc. (FIVN) - Five9 is a contact center software solutions provider benefiting from increased subscription revenues and enterprise AI traction [4][9] - The company offers a virtual contact center cloud platform with applications for customer service, sales, and marketing [5] - FIVN's expected revenue and earnings growth rates for the current year are 10.6% and 16.6%, respectively, with a 4.3% improvement in earnings estimates over the last 90 days [9] TaskUs Inc. (TASK) - TaskUs provides outsourced digital services across various sectors, including social media and e-commerce [11] - The company has formed strategic partnerships to enhance its agentic AI consulting services, driving double-digit growth [12][13] - TASK's expected revenue and earnings growth rates for the current year are 17.8% and 16.3%, respectively, with a 4.2% improvement in earnings estimates over the last 60 days [13] Workday Inc. (WDAY) - Workday's diversified product portfolio and cloud-based business model are key growth drivers, supported by significant investments [15][16] - The company has strong customer wins across various sectors, contributing to its revenue growth [16] - WDAY's expected revenue and earnings growth rates for the current year are 12.7% and 21.1%, respectively, with a 0.3% improvement in earnings estimates over the last 60 days [17] GitLab Inc. (GTLB) - GitLab offers a DevOps platform that enhances visibility and control over the DevOps lifecycle, with significant innovations in its product portfolio [18] - The introduction of GitLab Duo Workflow, a secure agentic AI, is expected to expand its market presence [19] - GTLB's expected revenue and earnings growth rates for the current year are 23.8% and 12.2%, respectively, with a notable 10.7% improvement in earnings estimates over the last 60 days [19] BILL Holdings Inc. (BILL) - BILL Holdings focuses on AI-enabled financial software for small and medium businesses, benefiting from a growing client base [21][22] - The company is enhancing customer experience through its AI-powered financial operations platform [22] - BILL's expected revenue and earnings growth rates for the current year are 10.5% and -3.2%, respectively, with a 0.5% improvement in earnings estimates over the last 30 days [23]

Core Thesis - TaskUs, Inc. is currently involved in a contentious take-private transaction led by its co-founders and Blackstone, with a proposed buyout price of $16.50 per share, which is viewed as undervaluing the company by activist investors [2][3] Financial Performance - For Q1 2025, TaskUs reported revenue of $277.8 million, reflecting a 22% year-over-year growth, with AI Services growing over 50% year-over-year and Trust & Safety maintaining over 30% growth for five consecutive quarters [2] - Year-to-date 2025 net income has reached 90% of the total net income for 2024, indicating strong financial performance [2] Shareholder Dynamics - The Buyer Group controls approximately 51% of Class A shares and 100% of Class B shares, initially planning to fund the transaction through TaskUs' $372 million liquidity position [3] - Activist investors, including Think Investments and Murchinson Ltd., have publicly opposed the deal, raising concerns about valuation, process fairness, and potential conflicts of interest [3][4] Market Reactions - ISS has recommended rejection of the proposed transaction, increasing pressure on Blackstone to improve its offer [4] - Recent share repurchases may have reduced minority voting power, but the transaction remains uncertain, with the Special Committee engaging stockholders and multiple adjournments of the merger approval meeting [4] Investment Sentiment - The bullish thesis on TaskUs emphasizes the potential upside driven by activist involvement and the growth of AI Services, despite the stock price being perceived as undervalued [5]

Core Points - TaskUs, Inc. announced that it did not receive the necessary votes to approve the transaction agreement with an affiliate of Blackstone [1] Company Summary - TaskUs is a leading provider of outsourced digital services and next-generation customer experience [1] - The announcement was made during a special meeting of TaskUs stockholders [1] Transaction Details - The transaction agreement involved TaskUs Co-Founder and Chief Executive Officer Bryce Maddock [1] - The failure to secure the required votes indicates potential challenges in the company's strategic initiatives [1]

Core Points - TaskUs, Inc. is urging stockholders to vote in favor of the merger agreement and the take-private acquisition by an affiliate of Blackstone [1] - The acquisition involves TaskUs Co-Founder and CEO Bryce Maddock and Co-Founder and President Jaspar Weir [1]