This article first appeared on GuruFocus .
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SaaS Revenue:$114.5 million in Q2, within guidance.
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SaaS Adjusted Gross Margin:66.6%.
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SaaS Adjusted EBITDA:$13.6 million, with a margin of 12%.
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SaaS ARPU:$394, up 12% year-over-year.
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SaaS Subscribers:95,000 at the end of Q2.
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Seasoned Net Revenue Retention (NRR):90%.
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Multi-Product Adoption:Clients with two or more SaaS products represented 29% of the base, up from 28% a year ago.
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Marketing Services Revenue:$36.2 million in Q2, above guidance.
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Marketing Services Adjusted EBITDA:$7.3 million, with a margin of 20%.
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Marketing Services Billings:$48.7 million, down 36% year-over-year.
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Net Debt:$241 million, with a leverage ratio of 2.1 times.
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Restructuring Charge:Approximately $25 million, with half expected in 2026 and half in the first half of 2027.
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Run Rate Savings:Approximately $60 million expected from restructuring.
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Full-Year Marketing Services Revenue Guidance:Raised low end to $161 million to $163 million.
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Full-Year Marketing Services Adjusted EBITDA Guidance:Revised to $31 million to $33 million.
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Q3 SaaS Revenue Guidance:$111 million to $112 million.
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Q3 SaaS Adjusted EBITDA Guidance:$8.5 million to $9.5 million.
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Full-Year SaaS Revenue Guidance:Revised to $453 million to $457 million.
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Full-Year SaaS Adjusted EBITDA Guidance:Revised to $42 million to $44 million.
Release Date: August 04, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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SaaS revenue reached $114.5 million in Q2, within guidance, and SaaS now represents 76% of total revenue, validating the company's transformation to a pure-play SaaS business.
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The Market, Sell, Grow (MSG) initiative grew 21% year-over-year, marking over a dozen consecutive quarters of double-digit growth, with SaaS ARPU up 12% to $394.
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The launch of the new AI-native Thryv Growth Platform on August 3, 2026, is a major strategic milestone, with early results showing clients experiencing 40% more revenue and AI-scored leads closing 1.5 times faster.
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Strategic partnerships with Wix and Ooma, along with new integrations with Breesy and Jobber, expand distribution channels and provide warm introductions to a large base of SMB customers without traditional acquisition costs.
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The company announced a restructuring program expected to generate approximately $60 million in run-rate savings, with a one-time charge of about $25 million, improving future operational efficiency.
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The company's reclassification as a software company under GICS underscores its successful strategic pivot and market recognition of its business model.
Negative Points
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Full-year SaaS revenue guidance was revised down to $453 million to $457 million, and SaaS adjusted EBITDA guidance was lowered to $42 million to $44 million, reflecting deliberate underinvestment in sales headcount and marketing during the first half.
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Marketing Services billings declined 36% year-over-year to $48.7 million, highlighting the ongoing and significant contraction of the legacy directory business.
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SaaS adjusted gross margin was 66.6%, with the mix of add-on revenue carrying traffic expense at lower margins, pressuring overall profitability.
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The company's seasoned net revenue retention (NRR) was 90%, reflecting natural attrition of smaller, lower-spend clients within the existing base.
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The restructuring program will incur a charge of approximately $25 million, with half expected in 2026 and the remainder in the first half of 2027, adding near-term financial strain.
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The company's strategic pivot and guidance adjustments have created a pattern of frequent changes, raising concerns about stability in product and go-to-market strategy.
Q & A Highlights
Q: When do we get to a spot of stability in both product and go-to-market strategy, given the pattern of tweaks and changes? A: Joe Walsh (CEO) acknowledged the pivoting but stated the new AI-native Thryv Growth Platform, which went GA on August 3, represents the sharpened focus on local business growth. He expects the growth seen in Marketing Center and its add-ons to become the main story over the next few quarters, with the directory business and other software initiatives being run off as the company focuses on the new platform.
Q: How do we think about your ability to service debt and make payments for the rest of the year, given the lowered EBITDA guidance? A: Paul Rouse (CFO) confirmed that cash flow remains strong and there is no issue servicing debt for the remainder of the year and into next. The company is focusing on lowering its revolver rather than the term loan, and the restructuring cuts will further support cash flow.
Q: How should investors expect more partnerships like Wix and Ooma to come, and what is the strategy behind them? A: Joe Walsh (CEO) explained the partnerships are part of an "ecosystem-led growth" model, plugging into complimentary services to expand reach. By narrowing focus on the Growth Platform and its add-ons, Thryv can be highly complimentary with other tools like CRMs or VoIP. He expects to continue announcing more partnerships to drive faster growth and better margins.
Q: How much of the restructuring is related to workforce reduction versus vendor efficiency? A: Cameron Lessard (SVP of Corporate Development & Strategy) detailed that of the approximately $25 million restructuring charge, half is attributed to vendor spend and half to workforce reductions. The charges are expected to be split evenly between fiscal 2026 and the first half of 2027.
Q: How do you think about the renewal cycle for customers brought in via product-led growth, and how will feature shifts impact cross-sell and up-sell? A: Grant Freeman (President) stated that the native AI features in the new platform do a better job at proving value, generating AI-suggested actions that lead to up-sell and cross-sell opportunities. This is expected to continue driving ARPU growth and a more stable software base, as seen with the increasing percentage of revenue from quality clients.
Q: Has AI changed the competitive environment, or is the shift in platform depth and breadth more company-specific? A: Joe Walsh (CEO) noted that generic CRM is becoming commoditized, which is why Thryv is moving away from that as a primary focus. Instead, the company is leveraging its strong Market, Sell, Grow initiative, which has seen 12 consecutive quarters of double-digit growth, to move upmarket with larger, stickier clients and higher ARPU.
Q: How is the go-to-market strategy for the Thryv Growth Platform different for existing customers versus greenfield opportunities? A: Grant Freeman (President) highlighted new vectors: partnerships like Wix and Ooma provide access to new "zoos" of pre-qualified owners. The direct sales force will use precision targeting, leveraging deep integrations (e.g., Jobber) to walk into accounts with a clear value proposition. The launch also unlocks a free trial, enabling a new inbound motion and easier distribution through partner ecosystems.
Q: How is the free trial strategy different on the Thryv Growth Platform, and what are your expectations for tapping into greenfield opportunities? A: Grant Freeman (President) explained that unlike Marketing Center, the new platform offers a full free trial. This allows salespeople to leave prospects with a working platform instead of nothing, returning days later to show delivered value, which aids conversion. It also enables serving up free trials at the point of purchase within partner ecosystems like Wix, reducing reliance on direct sales interactions and unlocking new distribution channels.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
