TaskUs(TASK) - 2024 Q2 - Quarterly Results

TaskUs Fiscal Second Quarter 2024 Results Financial & Operational Highlights TaskUs returned to year-over-year revenue growth in Q2 2024, with revenues up 3.8% and GAAP net income increasing by 24.3% Q2 2024 Key Financial Metrics | Metric | Q2 2024 | Q2 2023 | % Change | | :--- | :--- | :--- | :--- | | Service Revenue | $237.9M | $229.2M | 3.8% | | GAAP Net Income | $12.6M | $10.1M | 24.3% | | GAAP Diluted EPS | $0.14 | $0.10 | 40.0% | | Adjusted Net Income | $28.6M | $31.8M | (10.0)% | | Adjusted EPS | $0.31 | $0.32 | (3.1)% | | Adjusted EBITDA | $51.3M | $54.3M | (5.6)% | | Free Cash Flow | $25.5M | $28.7M | (11.2)% | - The company returned to year-over-year revenue growth, delivering nearly 4% growth in Q2, driven by strong performance from existing clients and new client revenue[2][3] - Sales and marketing investments yielded strong results, with Q2 marking the best bookings quarter since 2022[2] - The company added 2,100 teammates since Q1, ending Q2 2024 with a total of 51,700 teammates[2] - TaskUs repurchased 1.0 million shares during the second quarter of 2024[2] Third Quarter and Full Year 2024 Outlook TaskUs raised its full-year 2024 revenue guidance to $955 million-$975 million, projecting 4.4% year-over-year growth at the midpoint Q3 & Full Year 2024 Guidance | Metric | Q3 2024 Outlook | Full Year 2024 Outlook | | :--- | :--- | :--- | | Revenue | $244M - $246M | $955M - $975M | | Revenue Change (YoY at midpoint) | 8.6% | 4.4% | | Adjusted EBITDA Margin | ~21.5% | ~22% | | Free Cash Flow (in millions) | N/A | ~$120 | - The company raised both the bottom and top ends of its annual revenue guidance, signaling confidence in accelerating growth in Q3 and Q4[2] Consolidated Financial Statements This section presents TaskUs' detailed financial performance, including income statement, balance sheet, and cash flow statements for Q2 and H1 2024 Condensed Consolidated Statements of Income Service revenue increased to $237.9 million for Q2 2024, with net income rising to $12.6 million, reflecting growth for both three and six-month periods Income Statement Highlights (Three Months Ended June 30) | ($ in thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Service revenue | $237,928 | $229,169 | | Operating income | $22,722 | $22,169 | | Net income | $12,598 | $10,132 | Income Statement Highlights (Six Months Ended June 30) | ($ in thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Service revenue | $465,398 | $464,475 | | Operating income | $46,280 | $40,569 | | Net income | $24,312 | $19,641 | Condensed Consolidated Balance Sheets As of June 30, 2024, total assets reached $886.1 million, with cash and cash equivalents significantly increasing to $171.1 million Balance Sheet Summary (as of June 30, 2024) | ($ in thousands) | June 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $171,133 | $125,776 | | Total assets | $886,146 | $864,202 | | Total liabilities | $425,953 | $423,491 | | Total shareholders' equity | $460,193 | $440,711 | Condensed Consolidated Statement of Cash Flows Net cash provided by operating activities for the six months ended June 30, 2024, was $81.2 million, with significant cash used in financing activities due to stock repurchases Cash Flow Summary (Six Months Ended June 30) | ($ in thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $81,211 | $82,213 | | Net cash used in investing activities | ($8,088) | ($16,045) | | Net cash used in financing activities | ($18,614) | ($45,835) | | Increase in cash and cash equivalents | $54,509 | $20,333 | Non-GAAP Financial Measures & Reconciliations This section provides reconciliations for non-GAAP measures like Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow, offering insights into underlying business trends - The company uses non-GAAP financial measures to help illustrate underlying business trends, establish budgets, and evaluate performance by excluding items like stock-based compensation, transaction costs, and foreign currency impacts[8][15][16] Reconciliation of Adjusted EBITDA GAAP Net Income of $12.6 million for Q2 2024 was reconciled to an Adjusted EBITDA of $51.3 million, with a 21.5% Adjusted EBITDA margin Adjusted EBITDA Reconciliation (Q2 2024 vs Q2 2023) | ($ in thousands) | Q2 2024 | Q2 2023 | | :--- | :--- | :--- | | Net income | $12,598 | $10,132 | | Adjustments (D&A, Interest, Taxes, etc.) | $27,787 | $27,925 | | EBITDA | $40,385 | $38,057 | | Other Adjustments (Stock Comp, etc.) | $10,867 | $16,239 | | Adjusted EBITDA | $51,252 | $54,296 | | Adjusted EBITDA Margin | 21.5% | 23.7% | Reconciliation of Adjusted Net Income & Adjusted EPS Adjusted Net Income for Q2 2024 was $28.6 million, resulting in an Adjusted EPS of $0.31 after accounting for various adjustments from GAAP Net Income Adjusted Net Income Reconciliation (Q2 2024 vs Q2 2023) | ($ in thousands) | Q2 2024 | Q2 2023 | | :--- | :--- | :--- | | Net income | $12,598 | $10,132 | | Adjustments (Stock Comp, Amortization, etc.) | $17,210 | $21,721 | | Tax impacts of adjustments | ($1,173) | ($31) | | Adjusted Net Income | $28,635 | $31,822 | | Adjusted Net Income Margin | 12.0% | 13.9% | Adjusted EPS Reconciliation (Q2 2024 vs Q2 2023) | Per Share | Q2 2024 | Q2 2023 | | :--- | :--- | :--- | | GAAP diluted EPS | $0.14 | $0.10 | | Per share adjustments | $0.17 | $0.22 | | Adjusted EPS | $0.31 | $0.32 | Reconciliation of Free Cash Flow Free Cash Flow for Q2 2024 was $25.5 million, derived from operating activities and property purchases, representing a 49.8% conversion from Adjusted EBITDA Free Cash Flow Calculation (Q2 2024 vs Q2 2023) | ($ in thousands) | Q2 2024 | Q2 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $30,034 | $38,530 | | Purchase of property and equipment | ($4,516) | ($9,801) | | Free Cash Flow | $25,518 | $28,729 | | Conversion of Adjusted EBITDA | 49.8% | 52.9% | Company Information and Disclosures This section provides corporate overview, including business description, employee count, and important forward-looking statements and risk disclosures - TaskUs is a provider of outsourced digital services and customer experience for innovative companies in sectors like social media, e-commerce, gaming, FinTech, and HealthTech[5] - As of June 30, 2024, the company had approximately 51,700 employees across 27 locations in 12 countries[5] - The company's forward-looking statements are subject to risks including dependence on key clients, competition, data security, and global economic conditions, particularly in the Philippines and India[6][7] - A conference call to discuss the Q2 2024 results was scheduled for 5:00 pm ET on the day of the release[4]