TTEC Holdings, Inc. (NASDAQ: TTEC) is a leading global customer experience (CX) technology and services innovator, delivering AI-enhanced digital CX solutions that help iconic and disruptive brands enhance customer loyalty, revenue, and profitability. TTEC has established itself as a pioneer and leader in the industry, thriving through every technological evolution over the past four decades.

Financials

In the fiscal year 2023, TTEC reported annual revenue of $2,458,853,000 and net income of $84,280,000. The company generated annual operating cash flow of $144,765,000 and free cash flow of $76,926,000. These strong financial results demonstrate TTEC's ability to deliver value for its clients and shareholders.

Business Overview

TTEC operates through two complementary business segments: TTEC Digital and TTEC Engage. TTEC Digital is a pure-play CX technology and services firm, focused on helping clients modernize their CX technology platforms to take full advantage of the latest AI-enabled capabilities. TTEC Engage, on the other hand, provides the digitally enabled CX operational and managed services to support large, complex enterprise clients' end-to-end customer interactions at scale.

Q1 2024 Performance

In the first quarter of 2024, TTEC reported revenue of $576,638,000, a decrease of 8.9% compared to the same period in the prior year. The company's adjusted EBITDA for the quarter was $55,000,000, or 9.5% of revenue, compared to $83,000,000, or 13.1% of revenue, in the first quarter of 2023. The decrease in revenue and adjusted EBITDA margin was primarily due to a combination of factors, including the impact of a large client exiting a line of business, fluctuating volume forecasts from certain clients, and the timing of new program launches in the TTEC Engage segment.

Long-term Prospects

Despite these near-term challenges, TTEC remains confident in its long-term growth prospects. The company's TTEC Digital segment continued to deliver strong bookings and a growing pipeline, with 80% of its 2024 revenue guidance already under contract. In the TTEC Engage segment, the company has been successful in winning new enterprise deals, though the longer sales cycle and ramp-up time have impacted short-term profitability.

Geographical Distribution

Geographically, TTEC's revenue is diversified, with 67% generated in the United States and Canada, 21% in the Philippines, Asia Pacific, and India, 7% in Europe, Middle East, and Africa, and 5% in Latin America. This global footprint allows the company to leverage its offshore delivery capabilities and provide clients with cost-effective, high-quality CX solutions.

Recent Developments

TTEC's focus on innovation and technology-enabled services has been a key driver of its success. The company's TTEC Digital segment is at the forefront of CX technology, offering solutions that integrate contact center as a service (CCaaS), customer relationship management (CRM), and artificial intelligence (AI) and analytics. Meanwhile, TTEC Engage is integrating AI and technology into its service delivery to improve associate productivity and customer satisfaction.

One example of TTEC's innovative approach is its proprietary "Let Me Know" solution, which leverages Google's Vertex AI technology to provide clients with seamless access to the company's knowledge management services. This solution has already demonstrated impressive results, improving average handle time by 12% in a recent deployment.

Outlook

Looking ahead, TTEC has reiterated its full-year 2024 guidance, with the company expecting revenue to be in the range of $2,400,000,000 to $2,500,000,000 and adjusted EBITDA to be in the range of $260,000,000 to $280,000,000. The company is confident that its strategic initiatives, including diversifying its client base, expanding its geographic footprint, and driving innovation, will position it for long-term growth and profitability.

Conclusion

TTEC's commitment to delivering exceptional customer experiences, coupled with its technology-driven approach and global scale, make it a compelling investment opportunity in the rapidly evolving CX industry. As the company navigates the current market dynamics, its focus on operational excellence and strategic execution will be key to unlocking shareholder value in the years to come.