NEW YORK, Aug. 07, 2024 (GLOBE NEWSWIRE) -- Wolf Popper LLP is investigating claims on behalf of investors in Thoughtworks Holding, Inc. (NASDAQ: TWKS) concerning the acquisition of Thoughtworks by its controlling shareholder, Apax Partners LLP. Under the terms of the acquisition, Thoughtworks shareholders would receive $4.40 per share in cash. According to Wolf Popper partner Carl Stine, "The deal price of $4.40 per share seems unfairly low. It is significantly below Thoughtworks' 52-week high stock price ...

Core Viewpoint - The Zacks rating system reflects a company's earnings outlook, which can lead to increased buying pressure and stock price appreciation [2][3]. Earnings Estimates and Stock Performance - Changes in earnings estimates are strongly correlated with stock price movements, influenced by institutional investors who adjust their valuations based on these estimates [3][11]. - The Zacks Rank system classifies stocks based on earnings estimates, with a historical average annual return of +25% for Zacks Rank 1 stocks since 1988 [4]. Turing Holding's Earnings Outlook - Turing Holding is expected to earn $0.05 per share for the fiscal year ending December 2024, reflecting a year-over-year decline of -54.6% [5]. - Analysts have raised their earnings estimates for Turing Holding, with the Zacks Consensus Estimate increasing by 44.4% over the past three months [12]. Investment Implications - The upgrade of Turing Holding to a Zacks Rank 2 indicates an improvement in its underlying business, suggesting potential for stock price appreciation [10][14]. - The Zacks rating system maintains a balanced distribution of buy and sell ratings, with only the top 20% of stocks receiving higher ratings, indicating strong earnings estimate revisions [13].

Investors interested in stocks from the Technology Services sector have probably already heard of Thoughtworks Holding, Inc. (TWKS) and SoFi Technologies, Inc. (SOFI) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look. The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estim ...

Financial Data and Key Metrics - Q1 2024 revenue was $249 million, a year-over-year decline of 19% in both USD and constant currency [12] - Adjusted EBITDA margin for Q1 was 2.7%, below guidance due to lower-than-expected gross margins impacted by offshore/onshore mix adjustments [15][16] - Free cash flow was negative $20 million in Q1, compared to $31 million in the prior year period [23] - The company expects Q2 2024 revenue to be in the range of $250 million to $255 million, reflecting a year-over-year decline of 13% to 11% [47] - Full-year 2024 revenue is expected to be between $995 million and $1.02 billion, with an adjusted EBITDA margin of 8% to 10% [49] Business Line Performance - Strong demand for AI and data services, enterprise monetization, and DAMO managed services [8] - 57 clients had trailing 12-month bookings of over $5 million at quarter-end, with 49 new clients contracted in Q1 compared to 46 in Q4 2023 [10] - 62% of Q1 bookings came from outbound efforts, reflecting a focus on demand generation [11] - DAMO managed services saw 16 new deals in Q1, with 30% of the top 50 clients now using this service [40][148] Market Performance - Year-over-year revenue declines were observed across regions: 11% in APAC, 21% in Europe, 23% in North America, and 31% in LATAM [12] - APAC showed resilience, with stronger growth in Singapore and India, while Australia saw slower growth due to exposure in the tech sector [112][113] - China's local market is stabilizing and growing, though offshore work in China is constrained due to geopolitical tensions [115] Strategy and Industry Competition - The company is focusing on vertical-based sales models, particularly in energy, public and health services, technology, and business services [17] - Investments in AI and data services are paying off, with over 50 AI-related projects underway at the end of Q1 [33] - The acquisition of Watchful aims to accelerate AI model deployment and enhance Thoughtworks' position as a leading AI transformation partner [34] - The company is diversifying its service portfolio, with a focus on DAMO managed services and system integration [40][102] Management Commentary on Operating Environment and Future Outlook - The macroeconomic environment remains stable but challenging, with elongated sales cycles and smaller deal sizes [8][46] - Clients are focusing on achieving more with less, but no incremental budget pressures were observed in Q1 [46] - The company expects to return to sequential growth in Q2 2024, driven by strong bookings and a vertical-focused approach [7][47] - Management is confident in improving margins through cost management and supply rebalancing, with $87 million in annualized cost savings realized by Q1 [50][52] Other Key Information - Voluntary attrition on a TTM basis was 12.4%, slightly up from 12% in Q4 2023 but improved from 13.1% in Q1 2023 [25] - The company ended Q1 with a cash balance of $73 million and an undrawn $300 million revolving credit facility [24] - Thoughtworks published two new books and the 30th edition of its Technology Radar, with a third of the blips related to AI [42][43][44] Q&A Summary Question: Confidence in sequential growth in Q2 - The company is seeing some opening of discretionary spending, especially where there is a strong ROI case, and expects Q2 to return to sequential growth [63][65] Question: Impact of supply constraints on margins - Supply constraints from Q4 have been addressed, but margin pressure remains due to lower onshore utilization and offshore/onshore mix adjustments [66][67] Question: Pricing dynamics and margin improvement - Pricing declines are stabilizing, with no significant further drops expected, and margin improvement is driven by cost management and supply rebalancing [104][105][81] Question: Demand for AI and GenAI projects - Most AI work is still in the proof-of-concept stage, but the company expects larger-scale projects to emerge by the end of 2024 or early 2025 [135][136][152] Question: Industry-based go-to-market approach - The vertical-focused approach is resonating with clients, particularly in energy, public sector, and financial services, and is expected to drive further growth [126][127] Question: Top client concentration - Top 5 and top 10 client revenue concentration increased slightly, but the company is not overly concerned as it focuses on retaining and expanding relationships with top clients [131][132]

experiences strategies, operating models proactive evolution to rapidly unleash powered by governance, and transformation business value integrated engineering, services technology and predictive AI, design automation and ML capabilities End-to-end digital partner combining strategy, software engineering, design and organizational transformation © 2024 Thoughtworks 20 Thoughtworks' approach delivers value fast We deliver extraordinary impact for our clients via a collaborative and co-creative process that u ...

Financial Performance - Revenues for Q1 2024 were $248.6 million, a decrease of 19% compared to $307.1 million in Q1 2023[20]. - Total operating expenses in Q1 2024 were $262.8 million, down from $301.4 million in Q1 2023, reflecting a reduction of 13%[20]. - The net loss for Q1 2024 was $30.9 million, compared to a net loss of $8.1 million in Q1 2023, representing an increase in loss of 282%[20]. - Basic and diluted loss per common share for Q1 2024 was $0.10, compared to $0.03 in Q1 2023[20]. - The net loss for the three months ended March 31, 2024, was $30.88 million, compared to a net loss of $8.10 million for the same period in 2023[24]. - Adjusted EBITDA for the three months ended March 31, 2024, was $6.8 million, with an adjusted EBITDA margin of 2.7%, down from $34.9 million and 11.4% in the previous year[78]. - The net loss for the three months ended March 31, 2024, was $30.9 million, compared to a net loss of $8.1 million for the same period in 2023, reflecting a significant increase in the net loss margin by 9.8 percentage points[82][86]. Assets and Liabilities - As of March 31, 2024, total assets decreased to $1,268,520,000 from $1,327,236,000 as of December 31, 2023, reflecting a decline of approximately 4.4%[18]. - Total current liabilities decreased to $132,590,000 from $159,280,000, a reduction of approximately 16.8%[18]. - Stockholders' equity decreased to $753,356,000 from $773,130,000, reflecting a decline of about 2.5%[18]. - Total liabilities decreased to $515.2 million as of March 31, 2024, compared to $554.1 million at the end of 2023[18]. - Long-term debt, including the current portion, was $291.5 million as of March 31, 2024, slightly down from $293.2 million at the end of 2023[122]. Cash Flow - Cash flows from operating activities showed a significant decrease, with a cash outflow of $15.75 million compared to an inflow of $33.05 million in the previous year[25]. - Cash used in investing activities was $4.14 million, a decrease from $17.56 million in the prior year, primarily due to lower acquisitions[25]. - Cash used in financing activities amounted to $4.78 million, down from $102.04 million in the previous year, reflecting reduced long-term debt obligations[25]. - The total cash, cash equivalents, and restricted cash at the end of the period was $74.21 million, down from $110.56 million at the end of the previous year[26]. - The company expects existing cash and cash equivalents, along with projected cash flow from operations, to be sufficient for operating and capital expenditure requirements for at least the next twelve months[136]. Revenue Sources - Revenue from North America for the three months ended March 31, 2024, was $88.8 million, representing 32.7% of total revenues, down from $115.1 million or 34.4% in 2023[44]. - Revenue from international operations accounted for 67.3% of total revenues for the three months ended March 31, 2024, compared to 65.6% in 2023[40]. - Revenues from North America decreased by 22.8% to $88.8 million, while revenues from APAC decreased by 11.0% to $86.7 million[95]. Stock and Compensation - The company reported a total stock-based compensation expense of $10.6 million for the three months ended March 31, 2024, down from $17.7 million in the same period in 2023[87]. - The unvested balance of Restricted Stock Units (RSUs) at March 31, 2024, is 12,814,567, with a weighted average grant date fair value of $7.89[60]. - The total compensation cost related to RSUs not yet recognized is $85.4 million, to be recognized over a weighted-average period of 2.5 years[61]. Restructuring and Organizational Changes - The company reported a restructuring expense of $2.1 million in Q1 2024, which was not present in Q1 2023[20]. - The company announced a structural reorganization on August 8, 2023, aimed at centralizing operational functions and evolving its regional market structure[70]. Client and Market Activity - The number of clients increased to 501 as of March 31, 2024, from 442 in the same period in 2023, while the net dollar retention rate dropped to 86% from 106%[89]. - The company contracted with 49 new logos during the first quarter of 2024, focusing on sectors such as energy, public and health services, and technology[90]. Compliance and Regulatory Risks - The company continues to face risks related to compliance with laws and regulations, which may impact financial performance and investor confidence[17].

Exhibit 99.1 Our thought leadership and employee base of outstanding technologists position us to help our clients harness the power of cloud, data and AI to achieve future success." Update on Restructuring Activities Thoughtworks Reports First Quarter 2024 Financial Results CHICAGO, IL., (May 7, 2024) – Thoughtworks Holding, Inc. (NASDAQ: TWKS) ("Thoughtworks" or the "Company"), a leading global technology consultancy, today reported results for the first quarter of 2024 and provided an updated financial o ...

Thoughtworks Holding Inc. (NASDAQ:TWKS) Q4 2023 Earnings Conference Call February 27, 2024 8:00 AM ET Guo Xiao - Chief Executive Officer Erin Cummins - Chief Financial Officer Rob Muller - Global Head of Investor Relations Rob Muller Some of the matters weÂ'll discuss on this call, including our expected business outlook and anticipated costs and benefits of our restructuring actions, are forward-looking and as such are subject to known and unknown risks and uncertainties. These include but are not limited ...

[Part I](index=7&type=section&id=Part%20I) [Business](index=7&type=section&id=Item%201.%20Business) Thoughtworks is a global technology consultancy integrating strategy, design, and software engineering for enterprises, serving over 500 clients across 19 countries - Thoughtworks is a global technology consultancy with **over 10,500 employees** in **19 countries**, serving **over 500 clients** across various industries[22](index=22&type=chunk)[24](index=24&type=chunk)[25](index=25&type=chunk) - The company's five global service lines are: Enterprise Modernization, Platforms and Cloud; Customer Experience, Product and Design; Data & Artificial Intelligence (AI); Digital Transformation and Operations; and DAMO™ Managed Services[27](index=27&type=chunk) - Key growth strategies include broadening service offerings like GenAI and DAMO managed services, deepening relationships with existing clients, acquiring **new clients (from 416 in 2022 to 502 in 2023)**, developing new technical capabilities, and pursuing strategic acquisitions such as Itoc in 2023[32](index=32&type=chunk)[33](index=33&type=chunk) 2023 Revenue Breakdown | Category | Percentage of Total Revenue | | :--- | :--- | | **By Geography** | | | North America | 37.1% | | APAC | 34.3% | | Europe | 24.9% | | LATAM | 3.7% | | **By Industry Vertical** | | | Energy, public and health services | 26.1% | | Technology and business services | 24.8% | | Financial services and insurance | 17.5% | | Automotive, travel and transportation | 15.9% | | Retail and consumer | 15.7% | Client Concentration (2023) | Client Group | Percentage of Revenue | | :--- | :--- | | Top 5 Clients | 17.9% | | Top 10 Clients | 27.6% | | Existing Clients | 93.2% | - The company emphasizes a culture of diversity and inclusion, with **39.8% of its technologists** and **37.5% of its global management team** identifying as Women or Gender Diverse as of December 31, 2023[30](index=30&type=chunk)[39](index=39&type=chunk) [Risk Factors](index=15&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks from macroeconomic conditions, geopolitical instability, client retention challenges, and financial exposures including debt and currency fluctuations - Economic conditions have caused client delays, spending reductions, and significant pricing discounts, which puts pressure on margins and makes forecasting difficult[77](index=77&type=chunk)[80](index=80&type=chunk) - The company faces geopolitical risks, particularly related to its significant operations in China, including potential impacts from government regulations, foreign sanctions, and client sentiment[88](index=88&type=chunk) - A high percentage of revenue (**93.2% in 2023**) comes from existing clients, making client retention and relationship expansion critical[93](index=93&type=chunk) - The business is exposed to risks from developing and deploying emerging technologies like AI, including potential for harmful content, bias, intellectual property infringement, and new regulatory scrutiny[102](index=102&type=chunk) - As of December 31, 2023, the company had **$295.3 million in outstanding debt** under its Term Loan, which includes restrictive covenants that may limit operational and financial flexibility[121](index=121&type=chunk)[123](index=123&type=chunk) - The company is subject to complex and evolving data privacy regulations globally, such as GDPR in Europe and CCPA/CPRA in California, which could expose it to significant compliance costs and penalties for non-compliance[140](index=140&type=chunk)[141](index=141&type=chunk)[142](index=142&type=chunk) - Apax Funds control approximately **61.3% of the company's common stock**, making Thoughtworks a "controlled company" under Nasdaq rules, exempting it from certain corporate governance requirements[168](index=168&type=chunk)[172](index=172&type=chunk) [Unresolved Staff Comments](index=33&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports that it has no unresolved comments from the staff of the Securities and Exchange Commission - None[186](index=186&type=chunk) [Cybersecurity](index=33&type=section&id=Item%201C.%20Cybersecurity) Thoughtworks integrates cybersecurity into its Enterprise Risk Management program, overseen by the CISO and governed by the Board's Audit Committee, aligning with NIST and ISO frameworks - Cybersecurity risk management is integrated into the company's overall ERM program and aligns with industry frameworks such as NIST and ISO[187](index=187&type=chunk)[188](index=188&type=chunk) - Governance includes oversight from the Board's Audit Committee, an ERM Steering Committee, and a Technology Risk Steering Subcommittee, with the CISO having over 25 years of experience[194](index=194&type=chunk)[195](index=195&type=chunk)[196](index=196&type=chunk) - While the company has experienced cybersecurity events, it is not aware of any material cybersecurity incidents to date[192](index=192&type=chunk) [Properties](index=35&type=section&id=Item%202.%20Properties) The company leases its corporate headquarters in Chicago and additional office spaces globally, deeming current facilities adequate for immediate needs - The company leases its corporate headquarters in Chicago, Illinois, and maintains leased office spaces in numerous domestic and international locations[199](index=199&type=chunk) [Legal Proceedings](index=35&type=section&id=Item%203.%20Legal%20Proceedings) The company reports no current legal claims or proceedings expected to have a material adverse effect on its business or financial condition - There are currently no legal claims or proceedings against the company that are expected to have a material adverse effect on its business[201](index=201&type=chunk) [Mine Safety Disclosures](index=35&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[202](index=202&type=chunk) [Part II](index=36&type=section&id=Part%20II) [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=36&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on Nasdaq, with no anticipated cash dividends as earnings are retained for growth and debt repayment - The company's common stock trades on the Nasdaq Global Select Market under the symbol "TWKS"[205](index=205&type=chunk) - The company does not anticipate paying cash dividends in the foreseeable future, as it intends to retain earnings to fund business growth and repay debt[207](index=207&type=chunk) [Reserved](index=37&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved and contains no information [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=38&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2023, Thoughtworks' revenue decreased by **13.1% to $1.13 billion**, with net loss improving due to reduced stock-based compensation, while Adjusted EBITDA fell **56.5%** amid a structural reorganization [Key Operational and Business Metrics](index=38&type=section&id=Key%20Operational%20and%20Business%20Metrics) For 2023, revenues decreased **13.1% to $1.13 billion**, net loss improved due to lower stock-based compensation, and Adjusted EBITDA significantly declined **56.5%** Key Financial Metrics (2023 vs. 2022) | Metric | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | Revenues | $1,126.8 M | $1,296.2 M | (13.1)% | | Revenue Growth (Constant Currency) | (12.6)% | 26.8% | N/A | | Net Loss | $(68.7) M | $(105.4) M | (34.8)% | | Adjusted Net Income | $37.3 M | $139.9 M | (73.3)% | | Adjusted EBITDA | $111.7 M | $256.8 M | (56.5)% | | Adjusted EBITDA Margin | 9.9% | 19.8% | (990 bps) | - The decrease in net loss was primarily driven by a **$184.9 million reduction** in stock-based compensation expense, partially offset by a **$169.4 million decrease** in revenue[223](index=223&type=chunk) [Results of Operations](index=41&type=section&id=Results%20of%20Operations) In 2023, revenue declined across most verticals and regions, but gross margin improved due to lower stock-based compensation, despite **$18.9 million** in restructuring charges Client Metrics (2023 vs. 2022) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | Number of clients | 502 | 416 | | Clients > $10M revenue | 31 | 35 | | Net dollar retention rate | 87% | 109% | - Bookings decreased by **14.3% to $1.2 billion** in 2023 from **$1.4 billion** in 2022, reflecting macroeconomic caution and smaller contract sizes[257](index=257&type=chunk) - Gross margin increased by **4.7 percentage points to 31.4%** in 2023, primarily due to a decrease in stock-based compensation expense as a percentage of revenues[260](index=260&type=chunk) - The company incurred **$18.9 million in restructuring charges** in 2023, consisting of **$17.2 million** in wage-related expenses and **$1.7 million** in non-wage expenses[263](index=263&type=chunk) [Liquidity and Capital Resources](index=50&type=section&id=Liquidity%20and%20Capital%20Resources) As of December 31, 2023, the company had **$100.3 million** in cash and **$300.0 million** available under its revolver, with **$293.2 million** in total long-term debt Liquidity Position (as of Dec 31, 2023) | Item | Amount (in millions) | | :--- | :--- | | Cash and cash equivalents | $100.3 | | Availability under Revolver | $300.0 | | Long-term debt, net | $293.2 | Cash Flow Summary (Year Ended Dec 31, 2023) | Cash Flow Activity | Amount (in millions) | | :--- | :--- | | Net cash from Operating activities | $49.1 | | Net cash used in Investing activities | $(24.6) | | Net cash used in Financing activities | $(120.2) | - In February 2023, the company made a voluntary prepayment of **$100.0 million** on its outstanding Term Loan[494](index=494&type=chunk) [Critical Accounting Policies and Estimates](index=53&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) The company's critical accounting policies involve significant judgments in revenue recognition, stock-based compensation, and business combinations, particularly for fixed-price contracts and PSU valuations - Revenue from fixed-price contracts is recognized over time using input methods, which requires significant estimates of total costs to completion[306](index=306&type=chunk)[372](index=372&type=chunk) - Stock-based compensation expense is measured at grant date fair value, with rTSR Performance Stock Units (PSUs) valued using a Monte-Carlo simulation[308](index=308&type=chunk)[315](index=315&type=chunk) - Business combinations are accounted for using the acquisition method, requiring allocation of the purchase price to the fair value of assets and liabilities, with goodwill tested for impairment annually[316](index=316&type=chunk)[318](index=318&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=55&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to market risks from interest rate fluctuations and foreign currency exchange rates, impacting interest expense and revenues respectively - A hypothetical **100 basis point** increase or decrease in interest rates would result in a **$2.9 million increase** or **$3.4 million decrease**, respectively, in annual interest expense[321](index=321&type=chunk) - In 2023, **65% of total revenues** were denominated in currencies other than the U.S. dollar, where a hypothetical **10% change** in the U.S. dollar's value would impact revenues by approximately **$72.4 million**[322](index=322&type=chunk)[323](index=323&type=chunk) [Financial Statements and Supplementary Data](index=57&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements for 2021-2023, including balance sheets, statements of loss, equity, and cash flows, with accompanying notes Consolidated Balance Sheet Highlights (As of Dec 31) | Account | 2023 (in thousands) | 2022 (in thousands) | | :--- | :--- | :--- | | Total Assets | $1,327,236 | $1,461,850 | | Total Liabilities | $554,106 | $683,628 | | Total Stockholders' Equity | $773,130 | $778,222 | Consolidated Statement of Loss Highlights (Year Ended Dec 31) | Account | 2023 (in thousands) | 2022 (in thousands) | | :--- | :--- | :--- | | Revenues | $1,126,816 | $1,296,238 | | Loss from operations | $(20,312) | $(47,312) | | Net loss | $(68,661) | $(105,393) | | Basic and Diluted loss per share | $(0.22) | $(0.34) | - The independent auditor's report identified Revenue Recognition for Fixed-Price Contracts as a Critical Audit Matter due to the significant judgments and estimates involved in determining the total estimated costs to completion[334](index=334&type=chunk)[335](index=335&type=chunk) [Changes in and Disagreements With Accountants on Accounting and Financial Disclosure](index=94&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20With%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reported no disagreements with its accountants regarding accounting principles, financial disclosure, or auditing scope - None[504](index=504&type=chunk) [Controls and Procedures](index=94&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2023, with a previously identified material weakness successfully remediated - Management concluded that internal control over financial reporting was effective as of December 31, 2023[507](index=507&type=chunk) - A material weakness previously identified in prior periods related to the misclassification of cash flows for a contingent consideration payment was remediated as of December 31, 2023[509](index=509&type=chunk)[510](index=510&type=chunk) [Other Information](index=95&type=section&id=Item%209B.%20Other%20Information) No directors or executive officers adopted, terminated, or modified Rule 10b5-1 trading arrangements during the fourth quarter of 2023 - No directors or executive officers adopted, terminated, or modified a Rule 10b5-1 trading plan during the three months ended December 31, 2023[513](index=513&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=95&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) This item is not applicable to the company - Not applicable[514](index=514&type=chunk) [Part III](index=96&type=section&id=Part%20III) Part III of the report, covering Items 10 through 14, incorporates information by reference from the company's definitive proxy statement to be filed for its annual meeting of stockholders [Directors, Executive Officers and Corporate Governance](index=96&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information for this item will be incorporated by reference from the company's definitive proxy statement [Executive Compensation](index=96&type=section&id=Item%2011.%20Executive%20Compensation) Information for this item will be incorporated by reference from the company's definitive proxy statement [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=96&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information for this item will be incorporated by reference from the company's definitive proxy statement [Certain Relationships and Related Transactions, and Director Independence](index=96&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information for this item will be incorporated by reference from the company's definitive proxy statement [Principal Accounting Fees and Services](index=96&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Information for this item will be incorporated by reference from the company's definitive proxy statement [Part IV](index=97&type=section&id=Part%20IV) [Exhibits and Financial Statement Schedules](index=97&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists financial statements from Item 8 and all exhibits filed or incorporated by reference into the Annual Report on Form 10-K - This item lists the financial statements, financial statement schedules (omitted), and all exhibits filed as part of the annual report[522](index=522&type=chunk)[523](index=523&type=chunk) [Form 10-K Summary](index=99&type=section&id=Item%2016.%20Form%2010-K%20Summary) This item is not applicable and contains no information - None[527](index=527&type=chunk)

[Financial Performance and Company Overview](index=1&type=section&id=Financial%20Performance%20and%20Company%20Overview) This chapter provides an overview of the company's financial results, operational metrics, liquidity, and future outlook [Management Commentary and Business Update](index=1&type=section&id=Management%20Commentary%20and%20Business%20Update) Thoughtworks' Q4 2023 revenue of **$252.4 million** missed guidance by **5%** due to market challenges, while a restructuring program achieved **$81 million** in annualized cost savings - Q4 2023 revenue was **$252.4 million**, **5% below guidance**, attributed to supply constraints and cautious client behavior in the current macroeconomic environment[2](index=2&type=chunk) - The company acquired **46 new clients** and maintained strong relationships with **54 clients** having bookings over **$5 million**[3](index=3&type=chunk) - The restructuring program is substantially complete, realizing **$81 million** in annualized cost savings by Q4 end[3](index=3&type=chunk)[4](index=4&type=chunk) - Restructuring incurred approximately **$18.9 million** in pre-tax cash charges, primarily from wage-related costs[5](index=5&type=chunk) [Fourth Quarter 2023 Financial Performance](index=1&type=section&id=Fourth%20Quarter%202023%20Financial%20Performance) Q4 2023 saw an **18.8% revenue decline** to **$252.4 million**, with net loss margin at **(8.9)%** and Adjusted EBITDA Margin falling to **5.5%**, reflecting challenging market conditions [Q4 2023 Key Financial Metrics](index=1&type=section&id=Q4%202023%20Key%20Financial%20Metrics) Q4 2023 vs. Q4 2022 Financial Highlights | Metric | Q4 2023 | Q4 2022 | YoY Change | | :--- | :--- | :--- | :--- | | **Revenues** | $252.4 M | $310.7 M | (18.8)% | | **Net (Loss) Income Margin** | (8.9)% | 5.2% | (14.1) p.p. | | **Diluted (Loss) EPS** | $(0.07) | $0.05 | $(0.12) | | **Adjusted EBITDA Margin** | 5.5% | 18.7% | (13.2) p.p. | | **Adjusted Diluted EPS** | $0.02 | $0.10 | (80.0)% | | **Cash flow from operations** | $12.5 M | $33.0 M | (62.1)% | - Revenue decline in constant currency was **(19.8)%** year-over-year[6](index=6&type=chunk)[12](index=12&type=chunk) - Stock-based compensation decreased to **$16.9 million** from **$21.6 million** in Q4 2022[8](index=8&type=chunk) [Full Year 2023 Financial Performance](index=2&type=section&id=Full%20Year%202023%20Financial%20Performance) Full year 2023 revenues decreased **13.1%** to **$1,126.8 million**, with Adjusted EBITDA Margin falling to **9.9%** and Adjusted Diluted EPS dropping to **$0.11**, indicating a challenging profitability year [Full Year 2023 Key Financial Metrics](index=2&type=section&id=Full%20Year%202023%20Key%20Financial%20Metrics) Full Year 2023 vs. Full Year 2022 Financial Highlights | Metric | FY 2023 | FY 2022 | YoY Change | | :--- | :--- | :--- | :--- | | **Revenues** | $1,126.8 M | $1,296.2 M | (13.1)% | | **Net Loss Margin** | (6.1)% | (8.1)% | 2.0 p.p. | | **Diluted Loss Per Share** | $(0.22) | $(0.34) | $0.12 | | **Adjusted EBITDA Margin** | 9.9% | 19.8% | (9.9) p.p. | | **Adjusted Diluted EPS** | $0.11 | $0.43 | (74.4)% | | **Cash flow from operations** | $49.1 M | $89.4 M | (45.1)% | - Revenue decline in constant currency was **(12.6)%** year-over-year[9](index=9&type=chunk)[14](index=14&type=chunk) - Full year stock-based compensation significantly decreased to **$65.0 million** from **$249.9 million** in 2022 due to vested IPO-related grants[11](index=11&type=chunk) [Business and Operational Metrics](index=4&type=section&id=Business%20and%20Operational%20Metrics) Operational metrics show a **14.3% decrease** in trailing twelve-month bookings to **$1.2 billion**, with revenue declines across all geographic regions except for **11.2% growth** in Automotive, travel, and transportation [Bookings](index=4&type=section&id=Bookings) - Trailing twelve-month bookings decreased **14.3%** year-over-year to **$1.2 billion**, driven by reduced client budgets and a shift to offshore services[17](index=17&type=chunk) Clients by Booking Size (Trailing Twelve Months) | Booking Size | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | > $10 million | 25 | 39 | | $5 million to $10 million | 29 | 26 | [Revenue by Geography](index=4&type=section&id=Revenue%20by%20Geography) Full Year 2023 Revenue by Geography (YoY % Change) | Region | FY 2023 Revenue | YoY Change | | :--- | :--- | :--- | | North America | $417.6 M | (17.1)% | | APAC | $387.1 M | (7.8)% | | Europe | $280.4 M | (11.2)% | | LATAM | $41.8 M | (25.9)% | [Revenue by Industry Vertical](index=4&type=section&id=Revenue%20by%20Industry%20Vertical) Full Year 2023 Revenue by Industry Vertical (YoY % Change) | Industry Vertical | FY 2023 Revenue | YoY Change | | :--- | :--- | :--- | | Technology and business services | $279.3 M | (22.5)% | | Energy, public and health services | $294.0 M | (7.1)% | | Retail and consumer | $176.8 M | (25.3)% | | Financial services and insurance | $197.4 M | (11.0)% | | Automotive, travel and transportation | $179.3 M | 11.2% | [Liquidity and Financial Position](index=4&type=section&id=Liquidity%20and%20Financial%20Position) As of December 31, 2023, the company held **$100.3 million** in cash, with an undrawn **$300.0 million** revolving credit line and **$295.3 million** in total outstanding debt - The company held **$100.3 million** in cash and cash equivalents as of December 31, 2023[21](index=21&type=chunk) - A **$300.0 million** revolving credit line was available and undrawn at year-end[21](index=21&type=chunk) - Total outstanding debt, before deferred financing fees, was **$295.3 million**[22](index=22&type=chunk) [Financial Outlook for 2024](index=5&type=section&id=Financial%20Outlook%20for%202024) Thoughtworks forecasts Q1 2024 revenue between **$241 million** and **$246 million** (20-21% decline) and full-year revenue between **$980 million** and **$1,010 million** (10-13% decline), with Adjusted EBITDA margins of **3.0-4.0%** for Q1 and **8.0-10.0%** for the full year [First Quarter 2024 Outlook](index=5&type=section&id=First%20Quarter%202024%20Outlook) Q1 2024 Guidance | Metric | Guidance Range | | :--- | :--- | | **Revenues** | $241 M to $246 M | | YoY Revenue Decline | (21)% to (20)% | | **Adjusted EBITDA Margin** | 3.0% to 4.0% | | **Adjusted Diluted Loss Per Share** | $(0.02) to $(0.01) | [Full Year 2024 Outlook](index=5&type=section&id=Full%20Year%202024%20Outlook) Full Year 2024 Guidance | Metric | Guidance Range | | :--- | :--- | | **Revenues** | $980 M to $1,010 M | | YoY Revenue Decline | (13)% to (10)% | | **Adjusted EBITDA Margin** | 8.0% to 10.0% | | **Adjusted Diluted EPS** | $0.01 to $0.06 | [Detailed Financial Statements and Reconciliations](index=9&type=section&id=Detailed%20Financial%20Statements%20and%20Reconciliations) This chapter presents the company's consolidated financial statements, including statements of loss, balance sheets, cash flows, and reconciliations of non-GAAP measures [Consolidated Statements of Loss and Comprehensive Loss](index=9&type=section&id=Consolidated%20Statements%20of%20Loss%20and%20Comprehensive%20Loss) The Consolidated Statement of Loss shows a **net loss of $68.7 million** for 2023, an improvement from 2022, with **$18.9 million** in restructuring charges impacting operating expenses Key Items from Statement of Loss (Year Ended Dec 31, in thousands) | Item (in thousands) | 2023 | 2022 | | :--- | :--- | :--- | | **Revenues** | $1,126,816 | $1,296,238 | | **(Loss) from operations** | $(20,312) | $(47,312) | | **Restructuring** | $18,944 | $— | | **Net (loss) income** | $(68,661) | $(105,393) | | **Diluted (loss) per share** | $(0.22) | $(0.34) | [Consolidated Balance Sheets](index=10&type=section&id=Consolidated%20Balance%20Sheets) As of December 31, 2023, total assets decreased to **$1.33 billion** from **$1.46 billion**, with total liabilities falling to **$554.1 million** and stockholders' equity remaining stable at **$773.1 million** Key Balance Sheet Items (as of Dec 31, in thousands) | Item (in thousands) | 2023 | 2022 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $100,305 | $194,294 | | **Total current assets** | $428,358 | $556,690 | | **Goodwill** | $424,565 | $405,017 | | **Total assets** | $1,327,236 | $1,461,850 | | **Long-term debt, less current** | $286,035 | $391,856 | | **Total liabilities** | $554,106 | $683,628 | | **Total stockholders' equity** | $773,130 | $778,222 | [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities decreased to **$49.1 million** in 2023, with **$24.6 million** used in investing and **$120.2 million** in financing, resulting in a **$93.9 million** net decrease in cash Key Cash Flow Items (Year Ended Dec 31, in thousands) | Item (in thousands) | 2023 | 2022 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $49,064 | $89,389 | | **Net cash used in investing activities** | $(24,591) | $(93,945) | | **Net cash used in financing activities** | $(120,217) | $(175,125) | | **Net decrease in cash** | $(93,904) | $(199,378) | | **Cash at end of period** | $101,660 | $195,564 | [Reconciliation of Non-GAAP Financial Measures](index=12&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) This section reconciles GAAP to non-GAAP measures, adjusting for items like stock-based compensation and restructuring charges to present Adjusted Net Income, Adjusted EBITDA, and Free Cash Flow [Reconciliation of Adjusted Net Income and Adjusted Diluted EPS](index=12&type=section&id=Reconciliation%20of%20Adjusted%20Net%20Income%20and%20Adjusted%20Diluted%20EPS) - For FY 2023, GAAP Net Loss of **$(68.7) million** was reconciled to Adjusted Net Income of **$37.3 million**, primarily by adding back **$64.8 million** in stock-based compensation and **$18.9 million** in restructuring charges[52](index=52&type=chunk) - For Q4 2023, GAAP Net Loss of **$(22.4) million** was reconciled to an Adjusted Net Income of **$5.6 million**[52](index=52&type=chunk) [Reconciliation of Adjusted EBITDA and Other Metrics](index=13&type=section&id=Reconciliation%20of%20Adjusted%20EBITDA%20and%20Other%20Metrics) - For FY 2023, GAAP Net Loss of **$(68.7) million** was reconciled to Adjusted EBITDA of **$111.7 million**, with key add-backs including **$64.8 million** in stock-based compensation and **$18.9 million** in restructuring charges[54](index=54&type=chunk) - For Q4 2023, GAAP Net Loss of **$(22.4) million** was reconciled to Adjusted EBITDA of **$14.0 million**[54](index=54&type=chunk) [Reconciliation of Free Cash Flow](index=14&type=section&id=Reconciliation%20of%20Free%20Cash%20Flow) Free Cash Flow Reconciliation (in thousands) | | Q4 2023 | Q4 2022 | FY 2023 | FY 2022 | | :--- | :--- | :--- | :--- | :--- | | **Net cash from operating activities** | $12,466 | $33,048 | $49,064 | $89,389 | | **Purchase of property and equipment** | $(2,602) | $(4,833) | $(8,953) | $(24,505) | | **Free Cash Flow** | $9,864 | $28,215 | $40,111 | $64,884 |