Harte Hanks Reports Third Quarter 2025 Results

Core Insights - Harte Hanks reported a net loss of $2.3 million for Q3 2025, compared to a net income of $0.1 million in Q3 2024, reflecting challenges in revenue generation and program transitions [4][6][13] - The company is optimistic about future growth, particularly in its Customer Care segment, bolstered by a new partnership with Samsung Electronics America [3][7][8] Financial Performance - Revenue for Q3 2025 was $39.5 million, down from $47.6 million in Q3 2024, attributed to timing and transitions in legacy customer contracts [4][6] - Operating expenses decreased by 14.7% year-over-year to $39.0 million, down from $45.7 million in Q3 2024, due to strategic cost improvements [4][6] - EBITDA for Q3 2025 was approximately $1.7 million, with Adjusted EBITDA at $2.4 million, compared to $2.9 million and $4.1 million in Q3 2024, respectively [4][6][13] Segment Performance - Customer Care segment revenues were $11.6 million, an 11.6% decline from $13.1 million in Q3 2024, with segment EBITDA at approximately $1.1 million [13] - Marketing Services segment revenues were $8.8 million, reflecting a 33.4% decline from $13.3 million in Q3 2024, with segment EBITDA at approximately $1.8 million [13] - Fulfillment & Logistics Services segment revenues were $19.1 million, a 10.2% decrease from $21.3 million in Q3 2024, but segment EBITDA improved to $2.3 million from $1.3 million in the prior year [13] Outlook and Strategy - The company expects positive EBITDA for the full year 2025, driven by ongoing cost reductions and operational efficiencies [6][8] - Management is focused on replenishing the business development pipeline with new client opportunities and expansions, anticipating improvements in Q4 2025 [6][8] - The partnership with Samsung is seen as a significant milestone, indicating a shift towards higher-value, technology-enabled service delivery [3][7] Balance Sheet and Liquidity - As of September 30, 2025, Harte Hanks had $6.5 million in cash and cash equivalents, with no outstanding debt and up to $24 million available under its credit facility [8][21] - The company amended its credit facility to extend maturity to June 30, 2028, enhancing its financial flexibility [4][8]