Financial Data and Key Metrics Changes - For Q3 2024, the company reported revenue of $36.9 million, down 8% year-over-year in constant currency, while adjusted net revenue was $18.6 million, down 5% year-over-year in constant currency [6] - Adjusted EBITDA for Q3 was $0.8 million compared to $2 million a year ago [6] - The company reported a net loss of $0.8 million or $0.28 per diluted share, compared to net income of $0.5 million or $0.17 per diluted share in the same period last year [7] Business Line Data and Key Metrics Changes - Americas business revenue increased 6%, while adjusted net revenue decreased 3% year-over-year in constant currency, with adjusted EBITDA of $0.6 million, up from $0.3 million last year [8] - Asia Pacific business revenue decreased 15%, and adjusted net revenue decreased 11% year-over-year in constant currency, with adjusted EBITDA of $0.9 million compared to $2.3 million a year ago [8][9] - EMEA business revenue increased 7% year-over-year in constant currency, with adjusted net revenue increasing 5%, and adjusted EBITDA was flat at $0.2 million compared to the previous year [9] Market Data and Key Metrics Changes - The company ended the quarter with $16.5 million in cash, including $0.7 million of restricted cash, and generated $1.3 million in cash flow from operations, compared to a $0.7 million cash outflow from operations in Q3 2023 [10] - Days sales outstanding improved to 56 days at September 30, 2024, from 59 days at June 30, 2024 [10] Company Strategy and Development Direction - The company is focusing on enhancing geographical reach and service offerings through strategic hires, which have led to recognitions in the industry [11] - The "land and expand" strategy is showing incremental gains, with expansion into new geographies and territories with existing partners [12] - The company is committed to rightsizing its business to support client demands and provide necessary services [13] Management's Comments on Operating Environment and Future Outlook - Management noted that hiring volumes from existing clients have been significantly below expectations, particularly in the financial sector in Asia Pacific, but expects a return to normal levels next year [16][23] - The company is optimistic about client feedback and new business wins, indicating a robust sales pipeline and a bright future ahead [14] - Management highlighted the importance of a stable, pro-business environment for improving hiring levels, especially in the financial services sector [23] Other Important Information - The balance sheet reflects $5.8 million of goodwill and $2.8 million of net amortizable intangible assets as of September 30, 2024 [10] - The company has been actively buying back stock, with $2.5 million worth repurchased this year, and believes its stock is undervalued [27] Q&A Session Summary Question: Differences in activity across regions - Management noted growth in the Americas and EMEA, while Asia Pacific has seen lower hiring volumes, particularly in the financial sector [16][17] Question: Industry verticals leading activity - Life sciences and pharmaceuticals sectors remain stable, while financial services are underperforming, and technology is seeing incremental improvement [20] Question: Political ramifications on client demand - Management stated it is too early to assess political impacts but noted ongoing market uncertainties and the potential for a more stable environment to improve hiring [22][23] Question: Free cash flow and acquisition pipeline - The company is always looking at acquisition targets but prefers organic growth; no significant acquisitions are imminent, and they continue to buy back stock [25][27]
Hudson Global(HSON) - 2024 Q3 - Earnings Call Transcript