Thoughtworks Reports Third Quarter 2024 Financial Results
Thoughtworks (NASDAQ: TWKS) reported Q3 2024 financial results with revenues of $261.4 million, a 6.7% YoY decline. The net loss margin improved to 2.3% from 9.2% in Q3 2023. Adjusted EBITDA margin was 11.7%, slightly down from 12.0% last year. Diluted loss per share was $(0.02), an improvement from $(0.08) in Q3 2023.
The company is being acquired by Apax Partners for $4.40 per share, with the merger filed with the SEC on October 21, 2024. Restructuring activities aimed at cost reduction resulted in pre-tax charges of $22.6 million in Q3 2024 and $50.9 million since August 2023. Annualized savings from restructuring reached $180 million.
For the first nine months of 2024, revenues declined by 12.9% to $761.7 million. The net loss margin widened to 9.6% from 5.3% last year. Adjusted EBITDA margin dropped to 5.7% from 11.2%. The company reported bookings of $1.3 billion, a 7.1% YoY decrease.
Thoughtworks (NASDAQ: TWKS) ha riportato i risultati finanziari del Q3 2024 con entrate di $261,4 milioni, una diminuzione del 6,7% rispetto all'anno precedente. Il margine di perdita netta è migliorato al 2,3% rispetto al 9,2% del Q3 2023. Il margine EBITDA rettificato si è attestato all'11,7%, in leggera diminuzione rispetto al 12,0% dell'anno scorso. La perdita diluita per azione è stata di $(0,02), un miglioramento rispetto a $(0,08) del Q3 2023.
L'azienda è in fase di acquisizione da parte di Apax Partners per $4,40 per azione, con la fusione depositata presso la SEC il 21 ottobre 2024. Le attività di ristrutturazione mirate alla riduzione dei costi hanno comportato oneri pre-tasse di $22,6 milioni nel Q3 2024 e $50,9 milioni da agosto 2023. I risparmi annualizzati derivanti dalla ristrutturazione hanno raggiunto i $180 milioni.
Per i primi nove mesi del 2024, le entrate sono scese del 12,9% a $761,7 milioni. Il margine di perdita netta si è ampliato al 9,6% rispetto al 5,3% dell'anno scorso. Il margine EBITDA rettificato è sceso al 5,7% dal 11,2%. L'azienda ha riportato prenotazioni di $1,3 miliardi, con una diminuzione del 7,1% rispetto all'anno precedente.
Thoughtworks (NASDAQ: TWKS) informó los resultados financieros del Q3 2024 con ingresos de $261,4 millones, una disminución del 6,7% interanual. El margen de pérdida neta mejoró al 2,3% desde el 9,2% en el Q3 2023. El margen EBITDA ajustado fue del 11,7%, ligeramente inferior al 12,0% del año pasado. La pérdida diluida por acción fue de $(0,02), una mejora con respecto a $(0,08) en el Q3 2023.
La compañía está siendo adquirida por Apax Partners por $4,40 por acción, con la fusión registrada en la SEC el 21 de octubre de 2024. Las actividades de reestructuración orientadas a la reducción de costos resultaron en cargos antes de impuestos de $22,6 millones en el Q3 2024 y $50,9 millones desde agosto de 2023. Los ahorros anualizados provenientes de la reestructuración alcanzaron los $180 millones.
En los primeros nueve meses de 2024, los ingresos disminuyeron en un 12,9% a $761,7 millones. El margen de pérdida neta se amplió al 9,6% desde el 5,3% del año pasado. El margen EBITDA ajustado cayó al 5,7% desde el 11,2%. La compañía reportó reservas de $1,3 mil millones, una disminución del 7,1% interanual.
Thoughtworks (NASDAQ: TWKS)는 2024년 3분기 재무 실적을 보고하였으며, 수익은 2억 6,140만 달러로 전년 대비 6.7% 감소했습니다. 순손실마진은 2023년 3분기의 9.2%에서 2.3%로 개선되었습니다. 조정된 EBITDA 마진은 11.7%로, 작년의 12.0%에서 약간 감소하였습니다. 희석주당손실은 $(0.02)로, 2023년 3분기의 $(0.08)에서 개선되었습니다.
이 회사는 Apax Partners에 의해 주당 4.40달러에 인수될 예정이며, 합병 서류는 2024년 10월 21일 SEC에 제출되었습니다. 비용 절감을 목표로 하는 구조조정 활동은 2024년 3분기에 세전 비용으로 2,260만 달러, 2023년 8월 이후 총 5,090만 달러가 발생하였습니다. 구조조정으로 인한 연간 절감액은 1억 8,000만 달러에 달했습니다.
2024년 첫 아홉 달 동안 수익은 12.9% 감소하여 7억 6,170만 달러에 달했습니다. 순손실마진은 작년의 5.3%에서 9.6%으로 확대되었습니다. 조정된 EBITDA 마진은 11.2%에서 5.7%로 떨어졌습니다. 이 회사는 예약액이 13억 달러로 전년 대비 7.1% 감소했다고 보고했습니다.
Thoughtworks (NASDAQ: TWKS) a annoncé les résultats financiers du Q3 2024 avec des revenus de 261,4 millions de dollars, soit une baisse de 6,7% d'une année sur l'autre. La marge de perte nette s'est améliorée à 2,3% contre 9,2% au troisième trimestre 2023. La marge EBITDA ajustée était de 11,7%, légèrement en baisse par rapport à 12,0% l'année précédente. La perte diluée par action était de $(0,02), une amélioration par rapport à $(0,08) au Q3 2023.
La société est acquise par Apax Partners pour 4,40 $ par action, la fusion ayant été déposée auprès de la SEC le 21 octobre 2024. Les activités de restructuration visant à réduire les coûts ont entraîné des charges avant impôt de 22,6 millions de dollars au troisième trimestre 2024 et 50,9 millions de dollars depuis août 2023. Les économies annualisées issues de la restructuration ont atteint 180 millions de dollars.
Pour les neuf premiers mois de 2024, les revenus ont diminué de 12,9% pour s'établir à 761,7 millions de dollars. La marge de perte nette s'est élargie à 9,6% contre 5,3% l'année précédente. La marge EBITDA ajustée a chuté à 5,7% contre 11,2%. La société a rapporté des réservations de 1,3 milliard de dollars, une diminution de 7,1% d'une année sur l'autre.
Thoughtworks (NASDAQ: TWKS) hat die finanziellen Ergebnisse für Q3 2024 veröffentlicht, mit Umsätzen von 261,4 Millionen Dollar, einem Rückgang von 6,7% im Jahresvergleich. Die Nettoverlustmarge verbesserte sich auf 2,3% von 9,2% im Q3 2023. Die bereinigte EBITDA-Marge lag bei 11,7%, was einen leichten Rückgang gegenüber 12,0% im letzten Jahr darstellt. Verwässerter Verlust je Aktie betrug $(0,02), eine Verbesserung gegenüber $(0,08) im Q3 2023.
Das Unternehmen wird von Apax Partners für 4,40 USD je Aktie übernommen, die Fusion wurde am 21. Oktober 2024 bei der SEC eingereicht. Umstrukturierungsaktivitäten, die auf Kostensenkung abzielen, führten zu vorsteuerlichen Belastungen von 22,6 Millionen Dollar im Q3 2024 und 50,9 Millionen Dollar seit August 2023. Jährliche Einsparungen aus der Umstrukturierung beliefen sich auf 180 Millionen Dollar.
Für die ersten neun Monate von 2024 sanken die Umsätze um 12,9% auf 761,7 Millionen Dollar. Die Nettoverlustmarge weitete sich auf 9,6% von 5,3% im Vorjahr aus. Die bereinigte EBITDA-Marge fiel von 11,2% auf 5,7%. Das Unternehmen meldete Buchungen von 1,3 Milliarden Dollar, einen Rückgang von 7,1% im Jahresvergleich.
- Net loss margin improved to 2.3% from 9.2% in Q3 2023.
- Annualized savings from restructuring reached $180 million.
- Diluted loss per share improved to $(0.02) from $(0.08) in Q3 2023.
- Q3 2024 revenues declined by 6.7% YoY.
- Adjusted EBITDA margin decreased to 11.7% from 12.0% in Q3 2023.
- Revenues for the first nine months of 2024 declined by 12.9% YoY.
- Net loss margin widened to 9.6% from 5.3% for the first nine months of 2023.
- Adjusted EBITDA margin dropped to 5.7% from 11.2% for the first nine months of 2023.
- Bookings decreased by 7.1% YoY to $1.3 billion.
Insights
The Q3 results reflect ongoing challenges with
- Continued revenue pressure across most regions, with North America showing the steepest decline at
12.5% - Financial services vertical struggling with
23.3% YoY revenue drop - Free cash flow turned negative at
-$1.1M
The restructuring program is nearly complete, achieving
The bookings trend reveals significant market headwinds. While TTM bookings of
- Client budget constraints amid economic uncertainty
- Shift toward lower-cost offshore services
- Pricing pressure leading to discounts and adjustments
Despite maintaining 37 clients with
-
Third quarter revenues of
$261.4 million
Acquisition Update
As announced on August 5, 2024, Thoughtworks has entered into a definitive merger agreement to be acquired by affiliates of certain investment funds advised by Apax Partners LLP for
Update on Restructuring Activities
On August 8, 2023, Thoughtworks initiated several measures to reduce operational costs and better align our business with our customers’ needs in a challenging macroeconomic environment. On May 7, 2024, we increased our restructuring program to capture additional cost savings. On August 2, 2024, the Company’s Board of Directors approved a second increase to its restructuring plan. The restructuring program was completed on October 31, 2024, as expected. The Company expects to record an immaterial amount of expense in the fourth quarter of 2024 due to closing out the program and the finalization of certain restructuring expenses, in addition to expense incurred in October related to restructuring actions taken.
During the third quarter of 2024, Thoughtworks incurred pre-tax cash charges of approximately
QTD third quarter 2024 highlights
Revenues for the third quarter were
Net loss margin for the third quarter was (2.3)% compared to (9.2)% for the third quarter of 2023. Adjusted EBITDA Margin for the third quarter was
Diluted loss per share for the third quarter was
YTD third quarter 2024 highlights
Revenues for the nine months ended were
Net loss margin for the nine months ended was (9.6)% compared to (5.3)% for the nine months ended September 30, 2023. Adjusted EBITDA Margin for the nine months ended was
Diluted loss per share for the nine months ended was
QTD third quarter 2024 summary |
||||||||||||||
|
Three Months Ended
|
|
|
|
|
|||||||||
$ in millions, except per share data |
2024 |
|
2023 |
|
Change |
|
% Change(1) |
|||||||
GAAP Metrics: |
|
|
|
|
|
|
|
|||||||
Revenues(2) |
$ |
261.4 |
|
|
$ |
280.2 |
|
|
$ |
(18.8 |
) |
|
(6.7 |
)% |
Gross Profit |
$ |
91.9 |
|
|
$ |
94.2 |
|
|
$ |
(2.3 |
) |
|
(2.4 |
)% |
Gross Margin |
|
35.2 |
% |
|
|
33.6 |
% |
|
|
1.6 |
% |
|
|
|
SG&A |
$ |
69.7 |
|
|
$ |
81.8 |
|
|
$ |
(12.1 |
) |
|
(14.8 |
)% |
SG&A Margin |
|
26.7 |
% |
|
|
29.2 |
% |
|
|
(2.5 |
)% |
|
|
|
Stock-based compensation(3) |
$ |
6.9 |
|
|
$ |
12.8 |
|
|
$ |
(5.9 |
) |
|
(46.1 |
)% |
Net loss |
$ |
(6.1 |
) |
|
$ |
(25.9 |
) |
|
$ |
19.8 |
|
|
|
|
Net loss margin |
|
(2.3 |
)% |
|
|
(9.2 |
)% |
|
|
6.9 |
% |
|
|
|
Diluted loss per share |
$ |
(0.02 |
) |
|
$ |
(0.08 |
) |
|
$ |
0.06 |
|
|
|
|
Cash flow from operations |
$ |
2.1 |
|
|
$ |
6.4 |
|
|
$ |
(4.3 |
) |
|
(67.2 |
)% |
Non-GAAP Metrics(4): |
|
|
|
|
|
|
|
|||||||
Revenue Growth Rate at constant currency(5) |
|
(6.9 |
)% |
|
|
(16.6 |
)% |
|
|
|
|
|||
Adjusted Gross Profit |
$ |
97.3 |
|
|
$ |
104.9 |
|
|
$ |
(7.6 |
) |
|
(7.2 |
)% |
Adjusted Gross Margin |
|
37.2 |
% |
|
|
37.4 |
% |
|
|
(0.2 |
)% |
|
|
|
Adjusted SG&A |
$ |
66.9 |
|
|
$ |
72.8 |
|
|
$ |
(5.9 |
) |
|
(8.1 |
)% |
Adjusted SG&A Margin |
|
25.6 |
% |
|
|
26.0 |
% |
|
|
(0.4 |
)% |
|
|
|
Adjusted Net Income |
$ |
9.7 |
|
|
$ |
11.5 |
|
|
$ |
(1.8 |
) |
|
(15.7 |
)% |
Adjusted EBITDA |
$ |
30.7 |
|
|
$ |
33.6 |
|
|
$ |
(2.9 |
) |
|
(8.6 |
)% |
Adjusted EBITDA Margin |
|
11.7 |
% |
|
|
12.0 |
% |
|
|
(0.3 |
)% |
|
|
|
Adjusted Diluted EPS |
$ |
0.03 |
|
|
$ |
0.04 |
|
|
$ |
(0.01 |
) |
|
(25.0 |
)% |
Free Cash Flow |
$ |
(1.1 |
) |
|
$ |
3.7 |
|
|
$ |
(4.8 |
) |
|
|
|
YTD third quarter 2024 summary |
||||||||||||||
|
Nine Months Ended
|
|
|
|
|
|||||||||
$ in millions, except per share data |
2024 |
|
2023 |
|
Change |
|
% Change(1) |
|||||||
GAAP Metrics: |
|
|
|
|
|
|
|
|||||||
Revenues(2) |
$ |
761.7 |
|
|
$ |
874.4 |
|
|
$ |
(112.7 |
) |
|
(12.9 |
)% |
Gross Profit |
$ |
231.9 |
|
|
$ |
282.6 |
|
|
$ |
(50.7 |
) |
|
(17.9 |
)% |
Gross Margin |
|
30.5 |
% |
|
|
32.3 |
% |
|
|
(1.8 |
)% |
|
|
|
SG&A |
$ |
225.7 |
|
|
$ |
254.8 |
|
|
$ |
(29.1 |
) |
|
(11.4 |
)% |
SG&A Margin |
|
29.6 |
% |
|
|
29.1 |
% |
|
|
0.5 |
% |
|
|
|
Stock-based compensation(3) |
$ |
26.9 |
|
|
$ |
48.1 |
|
|
$ |
(21.2 |
) |
|
(44.1 |
)% |
Net loss |
$ |
(73.4 |
) |
|
$ |
(46.2 |
) |
|
$ |
(27.2 |
) |
|
|
|
Net loss margin |
|
(9.6 |
)% |
|
|
(5.3 |
)% |
|
|
(4.3 |
)% |
|
|
|
Diluted loss per share |
$ |
(0.23 |
) |
|
$ |
(0.15 |
) |
|
$ |
(0.08 |
) |
|
|
|
Cash flow from operations |
$ |
(31.9 |
) |
|
$ |
36.6 |
|
|
$ |
(68.5 |
) |
|
|
|
Non-GAAP Metrics(4): |
|
|
|
|
|
|
|
|||||||
Revenue Growth Rate at constant currency(5) |
|
(12.6 |
)% |
|
|
(10.2 |
)% |
|
|
|
|
|||
Adjusted Gross Profit |
$ |
251.3 |
|
|
$ |
321.7 |
|
|
$ |
(70.4 |
) |
|
(21.9 |
)% |
Adjusted Gross Margin |
|
33.0 |
% |
|
|
36.8 |
% |
|
|
(3.8 |
)% |
|
|
|
Adjusted SG&A |
$ |
207.9 |
|
|
$ |
226.0 |
|
|
$ |
(18.1 |
) |
|
(8.0 |
)% |
Adjusted SG&A Margin |
|
27.3 |
% |
|
|
25.8 |
% |
|
|
1.5 |
% |
|
|
|
Adjusted Net (Loss) Income |
$ |
(6.3 |
) |
|
$ |
31.7 |
|
|
$ |
(38.0 |
) |
|
|
|
Adjusted EBITDA |
$ |
43.2 |
|
|
$ |
97.8 |
|
|
$ |
(54.6 |
) |
|
(55.8 |
)% |
Adjusted EBITDA Margin |
|
5.7 |
% |
|
|
11.2 |
% |
|
|
(5.5 |
)% |
|
|
|
Adjusted Diluted (Loss) Earnings Per Share |
$ |
(0.02 |
) |
|
$ |
0.10 |
|
|
$ |
(0.12 |
) |
|
|
|
Free Cash Flow |
$ |
(42.7 |
) |
|
$ |
30.2 |
|
|
$ |
(72.9 |
) |
|
|
|
(1) The percentage change for the following items were excluded as they were determined to be not meaningful due to a loss or negative position in one or both periods. QTD: net loss, diluted loss per share and free cash flow. YTD: net loss, diluted loss per share, cash flow from operations, adjusted net (loss) income, adjusted diluted (loss) earnings per share and free cash flow. |
||||||||||||||
(2) Acquisitions completed in the last twelve months had an immaterial contribution to revenue growth for the quarter and nine months ended September 30, 2024. |
||||||||||||||
(3) The three and nine months ended September 30, 2024 include |
||||||||||||||
(4) See “Non-GAAP financial measures” for how we define these measures and the financial tables that accompany this release for reconciliation of these measures to the closest comparable GAAP measures. |
||||||||||||||
(5) Revenue Growth Rate at Constant Currency is calculated by translating the current period revenues into |
||||||||||||||
Bookings
Our overall bookings for the trailing twelve months ended September 30, 2024 was
|
Trailing Twelve Months Ended September 30, |
||
|
2024 |
|
2023 |
# of clients with bookings greater than |
37 |
|
37 |
# of clients with bookings between |
30 |
|
27 |
Revenue by geography(6) |
|||||||||||||||||
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||
$ in thousands |
2024 |
|
2023 |
|
% Change |
|
2024 |
|
2023 |
|
% Change |
||||||
|
$ |
92,039 |
|
$ |
105,241 |
|
(12.5 |
)% |
|
$ |
269,094 |
|
$ |
327,871 |
|
(17.9 |
)% |
APAC |
|
91,185 |
|
|
97,247 |
|
(6.2 |
)% |
|
|
266,993 |
|
|
293,411 |
|
(9.0 |
)% |
|
|
66,149 |
|
|
63,228 |
|
4.6 |
% |
|
|
191,415 |
|
|
207,775 |
|
(7.9 |
)% |
LATAM |
|
12,020 |
|
|
14,443 |
|
(16.8 |
)% |
|
|
34,155 |
|
|
45,373 |
|
(24.7 |
)% |
Total revenues |
$ |
261,393 |
|
$ |
280,159 |
|
(6.7 |
)% |
|
$ |
761,657 |
|
$ |
874,430 |
|
(12.9 |
)% |
(6) Revenues are presented geographically, by customer location. During the first quarter of 2024, in connection with the restructuring, the Company updated the disaggregation of revenue by customer location to reflect the geographical market based on contracting location, consistent with client ownership within our geographical markets, versus billing location, as previously reported. All corresponding disclosures and historical amounts have been recast to reflect the change. |
|||||||||||||||||
Revenue by industry vertical |
|||||||||||||||||
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||
$ in thousands |
2024 |
|
2023 |
|
% Change |
|
2024 |
|
2023 |
|
% Change |
||||||
Technology and business services |
$ |
67,203 |
|
$ |
70,612 |
|
(4.8 |
)% |
|
$ |
196,692 |
|
$ |
214,440 |
|
(8.3 |
)% |
Energy, public and health services |
|
67,059 |
|
|
71,662 |
|
(6.4 |
)% |
|
|
193,611 |
|
|
231,014 |
|
(16.2 |
)% |
Retail and consumer |
|
44,663 |
|
|
44,663 |
|
— |
% |
|
|
126,281 |
|
|
137,060 |
|
(7.9 |
)% |
Financial services and insurance |
|
35,603 |
|
|
46,447 |
|
(23.3 |
)% |
|
|
111,686 |
|
|
154,380 |
|
(27.7 |
)% |
Automotive, travel and transportation |
|
46,865 |
|
|
46,775 |
|
0.2 |
% |
|
|
133,387 |
|
|
137,536 |
|
(3.0 |
)% |
Total revenues |
$ |
261,393 |
|
$ |
280,159 |
|
(6.7 |
)% |
|
$ |
761,657 |
|
$ |
874,430 |
|
(12.9 |
)% |
Liquidity
We had cash and cash equivalents of
-###- <TWKS915>
About Thoughtworks
Thoughtworks is a global technology consultancy that integrates strategy, design and engineering to drive digital innovation. We are over 10,000 Thoughtworkers strong across 48 offices in 19 countries. For 30+ years, we've delivered extraordinary impact together with our clients by helping them solve complex business problems with technology as the differentiator.
Thoughtworks uses and intends to continue to use our investor relations website at https://investors.thoughtworks.com and social media, @thoughtworks on Twitter and LinkedIn, as a means of publicly disclosing material information and for complying with our disclosure obligations under Regulation Fair Disclosure. Investors should monitor these channels in addition to following the Company’s press releases, SEC filings, public conference calls and webcasts.
Forward-looking statements
This press release includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. In some cases, you can identify these forward-looking statements by the use of terms such as "expect," "will," "continue," or similar expressions, and variations or negatives of these words, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements represent our management's beliefs and assumptions only as of the date of this press release. You should read this press release with the understanding that our actual future results may be materially different from what we expect. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, which include but are not limited to: the statements under “Update on Acquisition” (including any other materials referenced therein), “Update on Restructuring Activities,” including expectations relating to the size of the restructuring actions, the amount and timing of related cost savings and charges and the potential long-term benefits of the restructuring actions; statements regarding relationships with existing and potential clients and their engagement decisions; and any other statements of expectation or belief. These statements are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from results expressed or implied in this press release. Such risk factors include, but are not limited to, those related to: current and future impact of macro-related factors on Thoughtworks' clients’ engagement decisions, Thoughtworks’ business and industry; the effects of competition on the future business of Thoughtworks; uncertainty regarding the demand for and market utilization of our services; the ability to implement our restructuring actions, including the costs of such actions and the uncertainty of the impact of such actions on financial performance; the ability to maintain or acquire new client relationships; other general business and economic conditions (including such conditions related to inflation and foreign currency exchange rates); the possibility that the Merger does not close when expected or at all because one or more conditions to the closing are not satisfied on a timely basis or at all; that the parties to the merger agreement may modify its terms and conditions; that the anticipated benefits of the Merger are not realized as a result of such things as the weakness of the economy and competitive factors in the technology consultancy industry; the Merger’s effect on the Company’s relationships with its customers and suppliers, whether or not the Merger is completed; the parties’ ability to successfully integrate operations in the Merger; significant or unanticipated transaction and merger-related integration costs; and our ability to successfully execute our strategy and strategic plans. For additional information concerning these and other risks and uncertainties, please see Thoughtworks' latest Annual Report on Form 10-K, latest Quarterly Report on Form 10-Q, and other filings and reports that Thoughtworks may file from time to time. Except as required by law, Thoughtworks assumes no obligation, and does not intend, to update these forward-looking statements, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.
Non-GAAP financial measures
Certain financial metrics contained in this press release are considered non-GAAP financial measures. Definitions of and the related reconciliations for these non-GAAP financial measures can be found below. We use these non-GAAP measures in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that these non-GAAP measures provide our management and investors consistency and comparability with our past financial performance and facilitate period-to-period comparisons of operations. However, non-GAAP measures have limitations as analytical tools, and you should not consider these measures in isolation or as substitutes for analysis of our financial results as reported under GAAP. For example, many of the non-GAAP financial measures used herein exclude stock-based compensation expense, which has recently been, and will continue to be for the foreseeable future, a significant recurring non-cash expense for our business and an important part of our compensation strategy.
Revenue Growth Rate and Revenue Growth Rate at constant currency
Certain of our subsidiaries use functional currencies other than the
Adjusted Gross Profit and Adjusted Gross Margin
We define gross profit as total revenues less cost of revenues. We define Adjusted Gross Profit as gross profit excluding stock-based compensation expense, employer payroll related expense on employee equity incentive plan and depreciation expense. We calculate Adjusted Gross Margin by dividing Adjusted Gross Profit by total revenues. Our management uses Adjusted Gross Profit to assess overall performance and profitability, without regard to the aforementioned adjustments, which are unrelated to our ongoing revenue-generating operations. We also believe this information will be useful for investors to facilitate comparisons of our operating performance and better identify trends in our business.
Adjusted SG&A and Adjusted SG&A Margin
We define Adjusted SG&A as selling, general and administrative expense excluding stock-based compensation expense, acquisition costs, certain professional fees that are considered unrelated to our ongoing revenue-generating operations, employer payroll related expense on employee equity incentive plan and CEO transition costs. We calculate Adjusted SG&A Margin by dividing Adjusted SG&A by total revenues.
Our management uses Adjusted SG&A and Adjusted SG&A Margin to assess our overall performance, without regard to items such as stock-based compensation expense and other items that are considered to be unique or non-recurring in nature or otherwise unrelated to our ongoing revenue-generating operations. We also believe this information will be useful for investors to facilitate comparisons of our operating performance and better identify trends in our business.
Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) Per Share
We define Adjusted Net Income (Loss) as net loss adjusted for unrealized (gain) loss on foreign currency exchange, stock-based compensation expense, amortization of acquisition-related intangibles, acquisition costs, certain professional fees that are considered unrelated to our ongoing revenue-generating operations, employer payroll related expense on employee equity incentive plan, the change in fair value of contingent consideration, restructuring costs, CEO transition costs and income tax effects of adjustments.
We define Adjusted Diluted Earnings (Loss) Per Share as diluted loss per share, with the numerator adjusted for the aforementioned adjustments to Adjusted Net Income (Loss). In other words, the numerator for Adjusted Diluted Earnings (Loss) Per Share utilizes Adjusted Net Income (Loss). We calculate Adjusted Diluted Earnings (Loss) Per Share by dividing Adjusted Net Income (Loss) by diluted weighted average shares outstanding.
Our management uses Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) Per Share to assess our overall performance, without regard to items that are considered to be unique or non-recurring in nature or otherwise unrelated to our ongoing revenue-generating operations, net of the income tax effects of adjustments.
Our management uses Adjusted Net Income (Loss) for planning purposes, including the preparation of our annual operating budget, as a measure of our core operating results and the effectiveness of our business strategy, and in evaluating our financial performance. We also believe this information will be useful for investors to facilitate comparisons of our operating performance and better identify trends in our business.
Adjusted EBITDA and Adjusted EBITDA Margin
We define Adjusted EBITDA as net loss adjusted to exclude income tax expense; interest expense; other (income) expense, net, excluding an unrealized gain/loss related to the mark to market adjustment on shares received in relation to the sale and settlement of trade receivables; unrealized (gain) loss on foreign currency exchange; stock-based compensation expense; depreciation and amortization expense; acquisition costs; certain professional fees that are considered unrelated to our ongoing revenue generating operations; employer payroll related expense on employee equity incentive plan; restructuring charges; and CEO transition costs. We calculate Adjusted EBITDA Margin by dividing Adjusted EBITDA by total revenues.
Adjusted EBITDA and Adjusted EBITDA Margin are widely used by investors and securities analysts to measure a company's operating performance without regard to the aforementioned adjustments that can vary substantially from company to company depending upon their financing, capital structures, and the method by which assets were acquired or costs that are unique or non-recurring in nature or otherwise unrelated to our ongoing revenue-generating operations.
Our management uses Adjusted EBITDA and Adjusted EBITDA Margin for planning purposes, including the preparation of our annual operating budget, as a measure of our core operating results and the effectiveness of our business strategy, and in evaluating our financial performance. We also believe this information will be useful for investors to facilitate comparisons of our operating performance and better identify trends in our business.
Free Cash Flow
We define Free Cash Flow as net cash (used in) provided by operating activities less cash used for purchases of property and equipment. We believe that Free Cash Flow is a useful indicator of liquidity for investors and is used by our management as it measures our ability to generate cash, or our need to access additional sources of cash, to fund operations and investments. There are a number of limitations related to the use of free cash flow as compared to net cash from operating activities, including that Free Cash Flow includes capital expenditures, the benefits of which are realized in periods subsequent to those when expenditures are made.
THOUGHTWORKS HOLDING, INC. |
|||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS |
|||||||||||||||
(In thousands, except share and per share data) |
|||||||||||||||
(unaudited) |
|||||||||||||||
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Revenues |
$ |
261,393 |
|
|
$ |
280,159 |
|
|
$ |
761,657 |
|
|
$ |
874,430 |
|
Operating expenses: |
|
|
|
|
|
|
|
||||||||
Cost of revenues |
|
169,456 |
|
|
|
185,985 |
|
|
|
529,713 |
|
|
|
591,845 |
|
Selling, general and administrative expenses |
|
69,701 |
|
|
|
81,840 |
|
|
|
225,747 |
|
|
|
254,806 |
|
Depreciation and amortization |
|
5,588 |
|
|
|
5,997 |
|
|
|
16,885 |
|
|
|
17,413 |
|
Restructuring |
|
22,604 |
|
|
|
15,566 |
|
|
|
31,931 |
|
|
|
15,566 |
|
Total operating expenses |
|
267,349 |
|
|
|
289,388 |
|
|
|
804,276 |
|
|
|
879,630 |
|
Loss from operations |
|
(5,956 |
) |
|
|
(9,229 |
) |
|
|
(42,619 |
) |
|
|
(5,200 |
) |
Other (expense) income: |
|
|
|
|
|
|
|
||||||||
Interest expense |
|
(7,059 |
) |
|
|
(6,649 |
) |
|
|
(20,282 |
) |
|
|
(19,661 |
) |
Net realized and unrealized foreign currency gain (loss) |
|
11,062 |
|
|
|
(8,813 |
) |
|
|
(5,251 |
) |
|
|
(7,658 |
) |
Other (expense) income, net |
|
59 |
|
|
|
43 |
|
|
|
552 |
|
|
|
(545 |
) |
Total other expense |
|
4,062 |
|
|
|
(15,419 |
) |
|
|
(24,981 |
) |
|
|
(27,864 |
) |
Loss before income taxes |
|
(1,894 |
) |
|
|
(24,648 |
) |
|
|
(67,600 |
) |
|
|
(33,064 |
) |
Income tax expense |
|
4,161 |
|
|
|
1,204 |
|
|
|
5,827 |
|
|
|
13,167 |
|
Net loss |
$ |
(6,055 |
) |
|
$ |
(25,852 |
) |
|
$ |
(73,427 |
) |
|
$ |
(46,231 |
) |
|
|
|
|
|
|
|
|
||||||||
Other comprehensive (loss) income, net of tax: |
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments |
|
3,118 |
|
|
|
(3,820 |
) |
|
|
5,618 |
|
|
|
(4,229 |
) |
Comprehensive loss |
$ |
(2,937 |
) |
|
$ |
(29,672 |
) |
|
$ |
(67,809 |
) |
|
$ |
(50,460 |
) |
|
|
|
|
|
|
|
|
||||||||
Net loss per common share: |
|
|
|
|
|
|
|
||||||||
Basic loss per common share |
$ |
(0.02 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.23 |
) |
|
$ |
(0.15 |
) |
Diluted loss per common share |
$ |
(0.02 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.23 |
) |
|
$ |
(0.15 |
) |
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding: |
|
|
|
|
|
|
|
||||||||
Basic |
|
323,452,180 |
|
|
|
317,805,140 |
|
|
|
323,031,967 |
|
|
|
317,204,506 |
|
Diluted |
|
323,452,180 |
|
|
|
317,805,140 |
|
|
|
323,031,967 |
|
|
|
317,204,506 |
|
Stock-based compensation expense included in the condensed consolidated statements of loss and comprehensive loss was as follows: |
|||||||||||
|
Three months ended
|
|
Nine months ended
|
||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
Cost of revenues |
$ |
3,719 |
|
$ |
7,462 |
|
$ |
14,391 |
|
$ |
28,688 |
Selling, general and administrative expenses (1) |
|
3,016 |
|
|
5,344 |
|
|
12,301 |
|
|
19,403 |
Restructuring |
|
169 |
|
|
— |
|
|
169 |
|
|
— |
Total stock-based compensation expense |
$ |
6,904 |
|
$ |
12,806 |
|
$ |
26,861 |
|
$ |
48,091 |
| (1) The three and nine months ended September 30, 2024 include |
|||||||||||
THOUGHTWORKS HOLDING, INC. |
|||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||||
(In thousands, except share and per share data) |
|||||||
|
September 30,
|
|
December 31,
|
||||
|
(unaudited) |
|
|
||||
Assets |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
46,956 |
|
|
$ |
100,305 |
|
Trade receivables, net of allowance of |
|
159,339 |
|
|
|
167,942 |
|
Unbilled receivables |
|
121,129 |
|
|
|
115,150 |
|
Prepaid expenses |
|
15,366 |
|
|
|
19,692 |
|
Other current assets |
|
35,113 |
|
|
|
25,269 |
|
Total current assets |
|
377,903 |
|
|
|
428,358 |
|
Property and equipment, net |
|
26,432 |
|
|
|
26,046 |
|
Right-of-use assets |
|
39,184 |
|
|
|
41,771 |
|
Intangibles and other assets: |
|
|
|
||||
Goodwill |
|
426,476 |
|
|
|
424,565 |
|
Trademark |
|
273,000 |
|
|
|
273,000 |
|
Other intangible assets, net |
|
105,903 |
|
|
|
114,186 |
|
Other non-current assets |
|
20,712 |
|
|
|
19,310 |
|
Total assets |
$ |
1,269,610 |
|
|
$ |
1,327,236 |
|
Liabilities and stockholders' equity |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
3,127 |
|
|
$ |
2,767 |
|
Long-term debt, current |
|
7,150 |
|
|
|
7,150 |
|
Accrued compensation |
|
84,196 |
|
|
|
88,712 |
|
Deferred revenue |
|
10,328 |
|
|
|
18,090 |
|
Accrued expenses and other current liabilities |
|
37,066 |
|
|
|
27,260 |
|
Lease liabilities, current |
|
13,350 |
|
|
|
15,301 |
|
Total current liabilities |
|
155,217 |
|
|
|
159,280 |
|
Lease liabilities, non-current |
|
29,037 |
|
|
|
29,791 |
|
Long-term debt, less current portion |
|
281,026 |
|
|
|
286,035 |
|
Deferred tax liabilities |
|
44,048 |
|
|
|
54,907 |
|
Other long-term liabilities |
|
25,439 |
|
|
|
24,093 |
|
Total liabilities |
|
534,767 |
|
|
|
554,106 |
|
Commitments and contingencies |
|
|
|
||||
Stockholders’ equity: |
|
|
|
||||
Convertible preferred stock, |
|
— |
|
|
|
— |
|
Common stock, |
|
374 |
|
|
|
373 |
|
Treasury stock, 50,435,538 and 50,468,697 shares at September 30, 2024 and December 31, 2023, respectively |
|
(622,576 |
) |
|
|
(622,988 |
) |
Additional paid-in capital |
|
1,656,937 |
|
|
|
1,627,491 |
|
Accumulated other comprehensive loss |
|
(32,548 |
) |
|
|
(38,166 |
) |
Retained deficit |
|
(267,344 |
) |
|
|
(193,580 |
) |
Total stockholders' equity |
|
734,843 |
|
|
|
773,130 |
|
Total liabilities and stockholders' equity |
$ |
1,269,610 |
|
|
$ |
1,327,236 |
|
THOUGHTWORKS HOLDING, INC. |
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) |
|||||||
(In thousands) |
|||||||
|
Nine months ended September 30, |
||||||
|
2024 |
|
2023 |
||||
Cash flows from operating activities: |
|
|
|
||||
Net loss |
$ |
(73,427 |
) |
|
$ |
(46,231 |
) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: |
|
|
|
||||
Depreciation and amortization expense |
|
21,508 |
|
|
|
27,367 |
|
Bad debt expense |
|
4,167 |
|
|
|
4,145 |
|
Deferred income tax benefit |
|
(12,972 |
) |
|
|
(21,759 |
) |
Stock-based compensation expense |
|
26,861 |
|
|
|
48,091 |
|
Unrealized foreign currency exchange loss |
|
4,814 |
|
|
|
9,488 |
|
Non-cash lease expense on right-of-use assets |
|
11,616 |
|
|
|
13,935 |
|
Other operating activities, net |
|
1,036 |
|
|
|
2,599 |
|
Changes in operating assets and liabilities: |
|
|
|
||||
Trade receivables |
|
4,658 |
|
|
|
43,827 |
|
Unbilled receivables |
|
(5,485 |
) |
|
|
(22,305 |
) |
Prepaid expenses |
|
4,322 |
|
|
|
3,505 |
|
Other assets |
|
(330 |
) |
|
|
2,546 |
|
Lease liabilities |
|
(11,280 |
) |
|
|
(14,219 |
) |
Accounts payable |
|
63 |
|
|
|
(1,183 |
) |
Accrued expenses and other liabilities |
|
(7,440 |
) |
|
|
(13,208 |
) |
Net cash (used in) provided by operating activities |
|
(31,889 |
) |
|
|
36,598 |
|
Cash flows from investing activities: |
|
|
|
||||
Purchase of property and equipment |
|
(10,839 |
) |
|
|
(6,351 |
) |
Proceeds from disposal of fixed assets |
|
527 |
|
|
|
327 |
|
Acquisitions, net of cash acquired |
|
(1,399 |
) |
|
|
(15,989 |
) |
Net cash used in investing activities |
|
(11,711 |
) |
|
|
(22,013 |
) |
Cash flows from financing activities: |
|
|
|
||||
Payments of obligations of long-term debt |
|
(5,363 |
) |
|
|
(105,363 |
) |
Payments of debt issuance costs |
|
— |
|
|
|
(99 |
) |
Proceeds from issuance of common stock on exercise of options |
|
2,818 |
|
|
|
4,880 |
|
Withholding taxes paid related to net share settlement of equity awards |
|
(4,166 |
) |
|
|
(3,501 |
) |
Payment of contingent consideration |
|
— |
|
|
|
(13,996 |
) |
Other financing activities, net |
|
(534 |
) |
|
|
71 |
|
Net cash used in financing activities |
|
(7,245 |
) |
|
|
(118,008 |
) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
(2,149 |
) |
|
|
(3,395 |
) |
Net decrease in cash, cash equivalents and restricted cash |
|
(52,994 |
) |
|
|
(106,818 |
) |
Cash, cash equivalents and restricted cash at beginning of the period |
|
101,660 |
|
|
|
195,564 |
|
Cash, cash equivalents and restricted cash at end of the period |
$ |
48,666 |
|
|
$ |
88,746 |
|
|
|
|
|
||||
Supplemental disclosure of cash flow information: |
|
|
|
||||
Interest paid |
$ |
18,673 |
|
|
$ |
18,669 |
|
Income taxes paid |
$ |
13,947 |
|
|
$ |
38,590 |
|
|
|
|
|
||||
Supplemental disclosure of non-cash activities: |
|
|
|
||||
ROU assets obtained in exchange for new operating lease liabilities |
$ |
8,740 |
|
|
$ |
12,518 |
|
|
|
|
|
||||
Reconciliation of cash, cash equivalents and restricted cash: |
|
|
|
||||
Cash and cash equivalents |
$ |
46,956 |
|
|
$ |
87,405 |
|
Restricted cash included in other non-current assets |
|
1,710 |
|
|
|
1,341 |
|
Total cash, cash equivalents and restricted cash |
$ |
48,666 |
|
|
$ |
88,746 |
|
THOUGHTWORKS HOLDING, INC. |
|||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|||||||||||||||
(In thousands, except percentages, share and per share data) |
|||||||||||||||
(unaudited) |
|||||||||||||||
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Net loss |
$ |
(6,055 |
) |
|
$ |
(25,852 |
) |
|
$ |
(73,427 |
) |
|
$ |
(46,231 |
) |
Unrealized foreign exchange (gain) loss |
|
(10,691 |
) |
|
|
10,223 |
|
|
|
4,814 |
|
|
|
9,488 |
|
Stock-based compensation (a) |
|
6,503 |
|
|
|
12,806 |
|
|
|
27,109 |
|
|
|
48,091 |
|
Amortization of acquisition-related intangibles |
|
3,829 |
|
|
|
3,656 |
|
|
|
11,268 |
|
|
|
10,916 |
|
Acquisition costs (b) |
|
656 |
|
|
|
1,533 |
|
|
|
2,365 |
|
|
|
5,339 |
|
Certain professional fees (c) |
|
(911 |
) |
|
|
2,051 |
|
|
|
1,392 |
|
|
|
3,801 |
|
Employer payroll related expense on employee equity incentive plan (d) |
|
89 |
|
|
|
264 |
|
|
|
353 |
|
|
|
755 |
|
Change in fair value of contingent consideration (e) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
129 |
|
Restructuring (f) |
|
22,604 |
|
|
|
15,566 |
|
|
|
31,931 |
|
|
|
15,566 |
|
CEO transition costs (g) |
|
232 |
|
|
|
— |
|
|
|
1,334 |
|
|
|
— |
|
Income tax effects of adjustments (h) |
|
(6,587 |
) |
|
|
(8,722 |
) |
|
|
(13,423 |
) |
|
|
(16,157 |
) |
Adjusted Net Income (Loss) |
$ |
9,669 |
|
|
$ |
11,525 |
|
|
$ |
(6,284 |
) |
|
$ |
31,697 |
|
|
|
|
|
|
|
|
|
||||||||
GAAP diluted weighted average common shares outstanding |
|
323,452,180 |
|
|
|
317,805,140 |
|
|
|
323,031,967 |
|
|
|
317,204,506 |
|
Employee stock options, RSUs and PSUs |
|
7,393,680 |
|
|
|
10,521,029 |
|
|
|
— |
|
|
|
12,434,247 |
|
Adjusted diluted weighted average common shares outstanding |
|
330,845,860 |
|
|
|
328,326,169 |
|
|
|
323,031,967 |
|
|
|
329,638,753 |
|
GAAP diluted loss per share |
$ |
(0.02 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.23 |
) |
|
$ |
(0.15 |
) |
Adjusted Diluted Earnings (Loss) Per Share |
$ |
0.03 |
|
|
$ |
0.04 |
|
|
$ |
(0.02 |
) |
|
$ |
0.10 |
|
THOUGHTWORKS HOLDING, INC. |
|||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|||||||||||||||
(In thousands, except percentages, share and per share data) |
|||||||||||||||
(unaudited) |
|||||||||||||||
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Net loss |
$ |
(6,055 |
) |
|
$ |
(25,852 |
) |
|
$ |
(73,427 |
) |
|
$ |
(46,231 |
) |
Income tax expense |
|
4,161 |
|
|
|
1,204 |
|
|
|
5,827 |
|
|
|
13,167 |
|
Interest expense |
|
7,059 |
|
|
|
6,649 |
|
|
|
20,282 |
|
|
|
19,661 |
|
Other (income) expense, net (i) |
|
(119 |
) |
|
|
(28 |
) |
|
|
(334 |
) |
|
|
759 |
|
Unrealized foreign exchange (gain) loss |
|
(10,691 |
) |
|
|
10,223 |
|
|
|
4,814 |
|
|
|
9,488 |
|
Stock-based compensation (a) |
|
6,503 |
|
|
|
12,806 |
|
|
|
27,109 |
|
|
|
48,091 |
|
Depreciation and amortization |
|
7,131 |
|
|
|
9,147 |
|
|
|
21,508 |
|
|
|
27,367 |
|
Acquisition costs (b) |
|
656 |
|
|
|
1,533 |
|
|
|
2,365 |
|
|
|
5,339 |
|
Certain professional fees (c) |
|
(911 |
) |
|
|
2,051 |
|
|
|
1,392 |
|
|
|
3,801 |
|
Employer payroll related expense on employee equity incentive plan (d) |
|
89 |
|
|
|
264 |
|
|
|
353 |
|
|
|
755 |
|
Restructuring (f) |
|
22,604 |
|
|
|
15,566 |
|
|
|
31,931 |
|
|
|
15,566 |
|
CEO transition costs (g) |
|
232 |
|
|
|
— |
|
|
|
1,334 |
|
|
|
— |
|
Adjusted EBITDA |
$ |
30,659 |
|
|
$ |
33,563 |
|
|
$ |
43,154 |
|
|
$ |
97,763 |
|
Net loss margin |
|
(2.3 |
)% |
|
|
(9.2 |
)% |
|
|
(9.6 |
)% |
|
|
(5.3 |
)% |
Adjusted EBITDA Margin |
|
11.7 |
% |
|
|
12.0 |
% |
|
|
5.7 |
% |
|
|
11.2 |
% |
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Gross profit, GAAP |
$ |
91,937 |
|
|
$ |
94,174 |
|
|
$ |
231,944 |
|
|
$ |
282,585 |
|
Stock-based compensation |
|
3,719 |
|
|
|
7,462 |
|
|
|
14,391 |
|
|
|
28,688 |
|
Employer payroll related expense on employee equity incentive plan (d) |
|
88 |
|
|
|
107 |
|
|
|
343 |
|
|
|
452 |
|
Depreciation expense |
|
1,543 |
|
|
|
3,150 |
|
|
|
4,623 |
|
|
|
9,954 |
|
Adjusted Gross Profit |
$ |
97,287 |
|
|
$ |
104,893 |
|
|
$ |
251,301 |
|
|
$ |
321,679 |
|
Gross margin, GAAP |
|
35.2 |
% |
|
|
33.6 |
% |
|
|
30.5 |
% |
|
|
32.3 |
% |
Adjusted Gross Margin |
|
37.2 |
% |
|
|
37.4 |
% |
|
|
33.0 |
% |
|
|
36.8 |
% |
Three months ended
|
|
Nine months ended
|
|||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
SG&A, GAAP |
$ |
69,701 |
|
|
$ |
81,840 |
|
|
$ |
225,747 |
|
|
$ |
254,806 |
|
Stock-based compensation (j) |
|
(2,784 |
) |
|
|
(5,344 |
) |
|
|
(12,718 |
) |
|
|
(19,403 |
) |
Acquisition costs (b) |
|
(656 |
) |
|
|
(1,533 |
) |
|
|
(2,365 |
) |
|
|
(5,339 |
) |
Certain professional fees (c) |
|
911 |
|
|
|
(2,051 |
) |
|
|
(1,392 |
) |
|
|
(3,801 |
) |
Employer payroll related expense on employee equity incentive plan (d) |
|
(1 |
) |
|
|
(157 |
) |
|
|
(10 |
) |
|
|
(303 |
) |
CEO transition costs (g) |
|
(232 |
) |
|
|
— |
|
|
|
(1,334 |
) |
|
|
— |
|
Adjusted SG&A |
$ |
66,939 |
|
|
$ |
72,755 |
|
|
$ |
207,928 |
|
|
$ |
225,960 |
|
SG&A margin, GAAP |
|
26.7 |
% |
|
|
29.2 |
% |
|
|
29.6 |
% |
|
|
29.1 |
% |
Adjusted SG&A Margin |
|
25.6 |
% |
|
|
26.0 |
% |
|
|
27.3 |
% |
|
|
25.8 |
% |
THOUGHTWORKS HOLDING, INC. |
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|
(In thousands, except percentages, share and per share data) |
|
(unaudited) |
|
(a) |
The three and nine months ended September 30, 2024 exclude |
(b) |
Adjusts for certain professional fees and retention wage expenses related to certain acquisitions. |
(c) |
Adjusts for certain one-time professional fees. During the third quarter of 2024, the Company capitalized |
(d) |
Adjusts for employer payroll related expense on employee equity incentive plan as these expenses are tied to the exercise or vesting of underlying equity awards and the price of our common stock at the time of vesting or exercise. As a result, these expenses may vary in any particular period independent of the financial and operating performance of our business. |
(e) |
Adjusts for the non-cash adjustment to the fair value of contingent consideration. |
(f) |
Adjusts for restructuring costs which include wage-related expenses, such as employee severance and related benefits, and non-wage related expenses, including costs related to reducing leased office space, vendor contract cancellations, professional fees, and other reorganization costs. |
(g) |
Adjusts for CEO transition costs which consists solely of stock compensation expense for the three months ended September 30, 2024 and includes |
(h) |
Adjusts for the income tax effects of the foregoing adjusted items, determined under the discrete method consistent with our non-GAAP measures of profitability. |
(i) |
Excludes an unrealized gain/loss related to the mark to market adjustment on shares received in relation to the sale and settlement of trade receivables which was included within other income (expense), net in the condensed consolidated statements of loss and comprehensive loss. |
(j) |
The three and nine months ended September 30, 2024 exclude |
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Net cash provided by (used in) operating activities |
$ |
2,062 |
|
|
$ |
6,355 |
|
|
$ |
(31,889 |
) |
|
$ |
36,598 |
|
Purchase of property and equipment |
|
(3,126 |
) |
|
|
(2,670 |
) |
|
|
(10,839 |
) |
|
|
(6,351 |
) |
Free Cash Flow |
$ |
(1,064 |
) |
|
$ |
3,685 |
|
|
$ |
(42,728 |
) |
|
$ |
30,247 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20241111222790/en/
Investor contact:
Thoughtworks Holding, Inc.
Rob Muller: investor-relations@thoughtworks.com
Press contact:
Thoughtworks Holding, Inc.
Linda Horiuchi: linda.horiuchi@thoughtworks.com
Source: Thoughtworks Holding, Inc.
FAQ
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