Thryv Holdings, Inc. (NASDAQ:THRY) Q4 2023 Earnings Conference Call February 22, 2024 8:30 AM ET

Company Participants

Cameron Lessard - Head, Investor Relations

Joe Walsh - Chairman & Chief Executive Officer

Grant Freeman - President

Paul Rouse - Chief Financial Officer

Conference Call Participants

Arjun Bhatia - William Blair

Zach Cummins - B. Riley Securities

Rob Oliver - Baird

Operator

Good day, and welcome to the Thryv Holdings Inc. Fourth Quarter and Full Year 2023 Earnings Call. All lines have been placed on mute to prevent any background noise. [Operator Instructions] Thank you.

Thank you. I'd now like to welcome Cameron Lessard, Head of IR to begin the conference. Cameron, over to you.

Cameron Lessard

Thank you, operator. Hello, and good day to everyone and welcome to Thryvs Fourth Quarter 2023 Earnings Conference Call. On the call today are Joe Walsh, Chairman and Chief Executive Officer; Paul Rouse, Chief Financial Officer; and Grant Freeman, President.

A copy of our earnings press release and investor presentation can be found on our website at thryv.com or in the Investor Section at investor.thryv.com. Please acknowledge comments made on today's call and responses to your questions may contain forward-looking statements about the operations and future results of the Company. These statements are subject to the risks and uncertainties described in the company's earnings release, and other filings with the SEC. Thryv has no obligation to update the information presented on the conference call.

Finally, our speakers will reference certain non-GAAP financial measures which we believe will provide useful information for investors. Reconciliation of those measures to GAAP will be posted on our website.

With that introduction, I would like to turn the call over to Chairman and CEO, Joe Walsh.

Joe Walsh

Good morning, Cameron, and thank you all for joining us on the call today to discuss our fourth quarter and full year results, 2023 was a stellar year for Thryv, and we capped it off with an incredible fourth quarter that once again exceeded our expectations. For the full year 2023, we delivered SaaS revenue of $264 million, up 22% year-over-year with SaaS adjusted EBITDA of $12 million, which represents an adjusted EBITDA margin of 5%, because when we started the year we were projecting somewhere around breakeven for our SaaS business. We've more than delivered on that objective.

And for the quarter, we're really happy to announce two notable improvements in our SaaS metrics. SaaS adjusted gross margins improved to 70% in the fourth quarter. Our gross margins have been trending towards the 75% that we guided in our long term guidance. And it's really a function of us having built out our platform. We've got more to go, but we're able to sell multiple centers out of existing customers. And so you end up with a lot better gross margins. So that's a trend that we think we'll see continuing.