Financial Data and Key Metrics Changes - For Q2 2025, revenue was $514 million, a decrease of 3.8% from $534 million in the prior year [28] - Adjusted EBITDA increased to $52 million, representing a 12% year-over-year increase and a margin improvement of 140 basis points to 10.1% [7][28] - Free cash flow was $86 million, up from $35 million in the prior year, reflecting a significant increase in operating cash flow [36] Business Line Data and Key Metrics Changes - In the Engage segment, revenue decreased by 4.3% to $400 million, but operating income increased by 26.3% to $18 million, reflecting a margin improvement [29][30] - The Digital segment saw a revenue decline of 2.3% to $114 million, but operating income increased by 22.8% to $18 million, largely due to a one-time sale of IP software [32][33] Market Data and Key Metrics Changes - The Engage backlog was $1.64 billion, representing 101% of the updated 2025 revenue guidance midpoint, indicating strong future revenue potential [31] - The Digital backlog was $387 million, or 83% of the 2025 revenue guidance midpoint, slightly down from the previous year [35] Company Strategy and Development Direction - The company is focused on expanding AI and analytics capabilities, diversifying its CX technology partner network, and enhancing operational efficiencies [7][12] - There is a strategic shift towards offshore operations, with a focus on acquiring new business in regions with high-quality talent [70][73] Management's Comments on Operating Environment and Future Outlook - Management noted that while there is economic uncertainty, they are confident in the company's ability to navigate challenges and achieve historical growth rates [90] - The company is seeing a cautious but positive trend in client spending, with many clients reallocating business due to market consolidation [56][58] Other Important Information - The company is committed to improving profitability, cash flow generation, and debt reduction, with a net leverage ratio of 3.39 times, down from previous quarters [37][42] - The normalized tax rate increased to 43.4% due to the impact of a valuation allowance recorded against US pretax losses [38] Q&A Session Summary Question: Update on bank discussions regarding revolver renewal - Management is in active discussions and is confident of closure in Q3 [48] Question: Broader application of accent neutralization technology - The technology is operational and opens up new markets by allowing access to highly educated talent with diverse accents [50] Question: Client recognition of the need to move forward with programs - Clients are cautious due to economic uncertainty but are reallocating business and recognizing the need for technology capabilities [56][58] Question: Performance of Engage offshore business - The offshore mix improved, with a focus on expanding in regions like South Africa and Eastern Europe [73] Question: Vertical opportunities for the second half - Opportunities are seen in financial services, healthcare, technology, travel, and streaming media [75][78] Question: Blended pricing and rate cards - Management prefers blended pricing but does not see it as deflationary; rather, technology application leads to increased business allocation [84][86] Question: Risks around customers shifting work offshore - The labor market in the US is tight, leading clients to consider offshore options for quality and quantity [88][90]

Financial Data and Key Metrics Changes - In Q1 2025, revenue was $534 million, a decrease of 7.4% from $577 million in the prior year, but exceeded the company's plan due to stronger revenue retention [18] - Adjusted EBITDA increased to $56 million, or 10.6% of revenue, compared to $55 million, or 9.5% in the prior year [18] - Operating income was $41 million, or 7.8% of revenue, up from $38 million, or 6.6% in the prior year [18] - Earnings per share decreased to $0.28 from $0.27 in the prior year [18] - Free cash flow improved to $16 million from a negative $29 million in the prior year [25] Business Segment Data and Key Metrics Changes - In the Digital segment, Q1 revenue was $108 million, down 3.6% year-over-year, but grew 2.8% excluding one-time product sales [19] - Recurring managed service offerings in Digital increased by 2.7%, representing approximately 66% of total revenue [19] - In the Engage segment, revenue decreased by 8.3% to $426 million, but operating income was $29 million, relatively flat compared to the prior year [22] - The Engage backlog was $1.59 billion, or 101% of the 2025 revenue guidance, up from 94% for the same period in 2024 [24] Market Data and Key Metrics Changes - The last twelve-month revenue retention rate for Engage was 88%, down from 94% in the prior year, but adjusted for a large client decline, it was 93% [25] - Digital's first quarter operating income improved to $12 million, or 11.2% of revenue, compared to $9 million, or 8.3% in the prior year [20] Company Strategy and Development Direction - The company is focused on three priorities: increasing diversification across clients and solutions, transforming experiences through digital innovation, and strengthening financial performance [5] - The strategy includes expanding offshore operations and integrating AI solutions to enhance operational efficiency and client offerings [10][21] - The company aims to differentiate itself through deep partnerships with hyperscalers and a singular focus on digital customer experience transformation [48] Management's Comments on Operating Environment and Future Outlook - Management noted a cautious approach from clients due to economic uncertainties and trade policy impacts, affecting their capital expenditure decisions [3][36] - Despite the cautious environment, the company is optimistic about signing new enterprise clients and expanding existing relationships [6][28] - The outlook for the second half of 2025 remains cautious, with management reiterating the importance of operational agility and cost optimization [27][29] Other Important Information - The company received multiple Stevie Awards for excellence in sales and service for its AI-enabled solutions [14] - The normalized tax rate increased to 37.9% in Q1 2025 from 32.7% in the prior year, primarily due to a US valuation allowance [27] Q&A Session Summary Question: Client adoption challenges - Management acknowledged that while clients are excited about new technologies, they are hesitant due to reliability concerns and economic uncertainties impacting their investment levels [35][36] Question: Differentiation with hyperscalers - Management emphasized their extensive experience and successful track record in building relationships with hyperscalers, which sets them apart from competitors [45][48] Question: Cost optimization efforts - Management confirmed ongoing cost optimization efforts and the need for continuous improvement, while also investing in product development and AI [49][50] Question: Demand environment and pipeline strength - Management expressed confidence in their pipeline and backlog, noting that while contract sizes may be smaller initially, they expect growth through successful execution [79][80] Question: Pricing pressures - Management indicated that while there is competitive pricing pressure, they maintain a disciplined approach to pricing, focusing on long-term profitability [82][84]

Financial Data and Key Metrics Changes - In Q1 2025, the company's revenue was $534 million, a decrease of 7.4% from $577 million in the prior year, but exceeded the forecasted plan [16] - Adjusted EBITDA increased to $56 million, representing 10.6% of revenue, compared to $55 million or 9.5% in the prior year [16] - Operating income rose to $41 million, or 7.8% of revenue, up from $38 million or 6.6% in the prior year [16] - Earnings per share decreased to $0.28 from $0.27 in the prior year [16] - Free cash flow improved to $16 million from a negative $29 million in the prior year [22] Business Segment Data and Key Metrics Changes - In the Digital segment, Q1 revenue was $108 million, down 3.6% year-over-year, but grew 2.8% excluding one-time product sales [17] - Recurring managed service offerings in Digital increased by 2.7%, representing approximately 66% of total revenue [17] - In the Engage segment, revenue decreased by 8.3% to $426 million, but operating income remained flat at $29 million, with a 70 basis point improvement as a percentage of revenue [20] - The Engage backlog was $1.59 billion, or 101% of the 2025 revenue guidance, up from 94% in the same period of 2024 [21] Market Data and Key Metrics Changes - The last twelve month revenue retention rate for Engage was 88%, down from 94% in the prior year, but adjusted for a large client loss, it was 93% [22] - Digital's first quarter operating income was $12 million, or 11.2% of revenue, compared to $9 million or 8.3% in the prior year [18] Company Strategy and Development Direction - The company is focused on three priorities: increasing diversification across clients and solutions, transforming experiences through digital innovation, and strengthening financial performance [4] - The strategy includes co-investing and collaborating with hyperscalers to build AI-enabled capabilities [4][9] - The company aims to enhance operational excellence and agility while managing costs effectively [26] Management's Comments on Operating Environment and Future Outlook - Management noted that clients are adopting a cautious approach due to economic uncertainties, impacting their investment decisions [2][31] - Despite the cautious environment, the company is encouraged by new client acquisitions and growth in existing client relationships [2][5] - The outlook for the second half of 2025 remains cautious due to potential macroeconomic impacts on client demand [25][26] Other Important Information - The company has made significant investments in proprietary technology and has a strong track record in customer experience (CX) technology [3][12] - The normalized tax rate increased to 37.9% in Q1 2025 from 32.7% in the prior year, primarily due to a valuation allowance against US pretax losses [25] Q&A Session Summary Question: Client adoption challenges - Management indicated that clients are excited about new technologies but are hesitant due to reliability concerns and economic uncertainties impacting their CapEx spending [31][32] Question: Differentiation from peers - The company believes it can differentiate itself through extensive experience and strong relationships with hyperscalers, focusing on digital CX transformation [39][41] Question: Cost optimization efforts - Management confirmed ongoing cost optimization efforts and emphasized the importance of balancing cost savings with investments in technology and AI [46][72] Question: Demand environment and contract sizes - Management noted that while there is a strong pipeline, contract sizes are starting smaller, reflecting caution in the market [78][79] Question: Pricing pressures - Management acknowledged competitive pricing pressures but expressed confidence in maintaining discipline in pricing strategies [82][84]

Core Viewpoint - TTEC Holdings, Inc. is expanding its operations in India by opening a new customer experience center in Mohali, which will create 400 new jobs to support a major U.S.-based healthcare organization [1][5]. Group 1: Expansion Details - The new customer experience center in Mohali will initially operate from C-205, Phase 8B, Industrial Area, Sector 74, Mohali, Punjab, and is expected to move to Quark City, an IT and tech hub, in August [3]. - TTEC has been operating in India for 24 years and has previously expanded its workforce, adding 800 positions in 2024 across its Mumbai and Hyderabad facilities [5]. Group 2: Technology and Services - The Mohali center will utilize TTEC's latest AI-enabled technologies, including TTEC Perform, TTEC Let Me Know, and TTEC Clarity, to enhance customer service experiences [4]. - TTEC's services encompass AI-enhanced customer engagement, customer acquisition, tech support, and fraud prevention, reflecting its commitment to delivering exceptional customer experiences [7]. Group 3: Talent and Cultural Alignment - Mohali was chosen for its scalable, English-proficient talent pool and cultural values that align with TTEC's service-first mindset, emphasizing selfless service and community cohesion [2]. - The company currently employs approximately 3,500 individuals across India, including locations in Ahmedabad and Chennai, showcasing its investment in regional talent and infrastructure [5].

Core Insights - TTEC Holdings, Inc. has been awarded five 2025 Stevie® Awards for its AI-powered customer experience solutions, highlighting its leadership in the CX technology sector [1][2][6] Awards and Recognition - TTEC received two Gold, one Silver, and two Bronze Stevie® Awards, reflecting its commitment to enhancing customer and employee experiences through AI technology [2][6] - The awards validate TTEC's impact on client outcomes, including improved customer satisfaction and operational efficiencies [3][6] Award-Winning Innovations - **Gold – Customer Service Training or Coaching Program of the Year**: TTEC Perform, a real-time coaching tool, increased sales conversions by 10% and reduced average handle time by 6% for an insurance client [3] - **Gold – Innovation in Sales**: TTEC's AI-Powered Service to Sales solution led to a 27% revenue lift per associate for a telecom client in just 15 days [4] - **Silver – Customer Service Success**: TTEC's training for a medical device company reduced error rates to 0.03% and cut handle time by over 50% [4] - **Bronze – Use of Data & Analytics in Customer Service**: TTEC Insights helped an automaker client uncover $3.2 million in new revenue potential and reduced coaching time by 53% [5] - **Bronze – Best Use of Technology in Customer Service**: Addi AI enabled multilingual conversations, reducing interpreter costs by up to 80% in sectors like healthcare and education [5] Company Overview - TTEC is a global innovator in customer experience technology and services, focusing on AI-enabled digital solutions [7][8] - The company serves a diverse range of brands and offers outcome-based solutions that enhance the customer journey across various interaction channels [7][8] - Founded in 1982, TTEC emphasizes the integration of technology and human expertise to deliver superior customer experiences [8]