Thryv (NASDAQ:THRY) executives used the company’s fourth-quarter 2025 earnings call to outline a “next phase” strategy that expands beyond its transition from legacy print and marketing services into SaaS. Management emphasized a shift toward a unified, AI-enabled offering—described as the “Thryv Platform”—and encouraged investors to focus on higher-spending “quality customers” as a better indicator of long-term business value.
Management frames next phase: unified platform to “market, sell, and grow”
Chairman and CEO Joe Walsh said 2025 was “a solid year,” citing 34% year-over-year SaaS revenue growth for the full year and a SaaS adjusted EBITDA margin of 16.8%. Walsh said the company is moving from selling distinct products and “centers” to delivering a single growth platform for small businesses that need to “get found and chosen,” convert leads into sales, and drive repeat business.
Looking ahead, Walsh said Thryv plans to launch the AI-powered Thryv Platform later in 2026, built around a CRM and automation layer designed to support onboarding, automation, AI-driven insights, and customer expansion. He also described a go-to-market evolution toward product-led growth and a hybrid product-led sales model, with more self-service for entry-level customers and sales focus shifting toward higher-value tiers.
AI strategy: partner-driven approach and embedded workflows
CTO Sean Wechter, who joined the company in October, said his first priorities were to “amp up” AI efforts and improve data assets. He described Thryv’s AI strategy as partner-oriented and experiment-driven, using a “bullets versus cannonballs” approach of testing tools and doubling down on what works across sales, customer success, and engineering.
Wechter said the company aims to bring AI “down market” to small businesses in an “ambient” way, where AI can proactively execute tasks such as rescheduling appointments or moving leads between systems. He highlighted several AI initiatives discussed on the call:
- Budget Optimizer: Uses AI to transcribe and score calls, then applies machine learning to optimize lead sources and customer budget allocation.
- New Zealand directory assistance program: Uses AI voice interaction and workflow automation to provide an AI directory assistance experience.
- MCP solution: Intended to help integrate with “top frontier models.” Wechter said Thryv was “second to market” with a native MCP solution and is keeping it as a frontier program as the technology matures.
In Q&A, Walsh and Wechter added that AI features under development and deployment include call transcription, lead grading, automated funnel routing, follow-up automation, social posting, website generation, and an “AI receptionist” to help capture missed calls.
Fourth-quarter results: SaaS growth, ARPU gains, and multi-product adoption
CFO Paul Rouse reported that fourth-quarter SaaS revenue increased 14.1% to $119 million, within guidance. Keap contributed $16.2 million in the quarter. For the full year, SaaS revenue increased 34.2% year-over-year to $461 million.
Rouse said SaaS adjusted gross margin was 70.4% in the fourth quarter and 72.7% for the full year, up 70 basis points year-over-year. SaaS adjusted EBITDA was $20 million in the fourth quarter, within guidance, and SaaS adjusted EBITDA margin was 16.8%. Full-year SaaS adjusted EBITDA was $73.8 million, for a 16% margin.
Operational metrics cited on the call included:
- Subscribers: 100,000 SaaS subscribers at quarter-end
- ARPU: $373, up 15% year-over-year
- Seasoned NRR: 94% for the quarter (flat)
- Quality customers: Customers spending $400+ per month grew by 3,000 (18% year-over-year) and represent more than 20% of the client base
- Revenue mix: Walsh said quality customers accounted for 69% of revenue in Q4, up from 60% the prior year
- Multi-product adoption: Clients with two or more SaaS products rose to 19,000 (23% of the base) from 15,000 (16%) a year earlier
Marketing services wind-down continues; cash flow and leverage update
Rouse reported marketing services revenue of $72.6 million in the fourth quarter and $324 million for the full year. Marketing services adjusted EBITDA was $18.8 million in the quarter (25.9% margin) and $78 million for the year (24.1% margin). Fourth-quarter marketing services billings were $60.9 million, down 34% year-over-year, which management attributed to an intentional shift as Thryv initiates upgrades of legacy digital marketing services clients onto its SaaS platform.
Rouse reiterated that Thryv expects to exit marketing services by 2028, with cash flows lasting through 2030, which he said would provide liquidity as the company transforms to a pure-play software business.
On cash flow and balance sheet items, Rouse said free cash flow was $31.1 million in 2025 and is expected to increase meaningfully to $40 million to $50 million in 2026. The company ended the fourth quarter with net debt reduced by $15 million to $251 million, bringing leverage to 1.7x.
2026 outlook: conservative guide as product mix shifts
For 2026, Thryv guided to first-quarter SaaS revenue of $114 million to $115 million and full-year SaaS revenue of $461 million to $471 million. The company expects first-quarter SaaS adjusted EBITDA of $12 million to $13 million and full-year SaaS adjusted EBITDA of $70 million to $75 million.
For marketing services, Thryv guided to 2026 revenue of $150 million to $160 million and adjusted EBITDA of $30 million to $35 million.
Walsh said the SaaS guidance is “a little bit conservative,” citing a transition period in which growth could slow for a few quarters before re-accelerating later in the year. In Q&A, Walsh discussed “some” cannibalization as certain customers move from Thryv’s Business Center toward the market-sell-grow offering, which he said has generated significant internal and customer enthusiasm.
On customer dynamics, Walsh said the company expects churn to trend down over time as it moves upmarket. He described higher churn among very small businesses and solopreneurs—sometimes due to business closures rather than product dissatisfaction—while larger businesses spending $400 or more per month tend to be more stable and expand usage.
About Thryv (NASDAQ:THRY)
Thryv Holdings, Inc (NASDAQ:THRY) is a software and technology solutions provider focused on helping small- and medium-sized businesses manage customer relationships, marketing and communications, appointments and payments through a unified platform. Headquartered in Dallas, Texas, the company delivers cloud-based software designed to simplify administrative tasks and enable business owners to engage with customers across multiple channels.
At the core of Thryv’s offerings is its flagship Thryv software platform, which combines customer relationship management (CRM) tools, automated marketing and social media management, online scheduling, invoicing and payment processing.
