TaskUs Announces Fiscal Fourth-Quarter and Full-Year 2024 Results

Published: 2025-02-26 16:09:04 ET TASK

TaskUs, Inc. (Nasdaq: TASK), a leading provider of outsourced digital services and next-generation customer experience to the world’s most innovative companies, today announced its results for the fourth quarter and full year ended December 31, 2024.

“In 2024, we delivered on our goal of returning the company to growth, ending the year with 17.1% year-over-year revenue growth, and the highest revenue quarter in TaskUs' history. Our full-year revenue of $995 million also set a new company record,“ said Co-Founder and CEO, Bryce Maddock. “Looking ahead to 2025, we aim to sustain this momentum. We expect total revenue for the full year 2025 to range between $1.095 and $1.125 billion, with an Adjusted EBITDA margin of approximately 21%.”

Fourth Quarter and Full Year 2024 Financial and Frontline Highlights

($ in thousands, except per share amounts)

Three months ended December 31,

Year ended December 31,

2024

2023

% Change

2024

2023

% Change

Service revenue

274,242

234,264

17.1

994,985

924,365

7.6

Net income

8,859

16,277

(45.6

45,870

45,690

0.4

Net income margin

3.2

6.9

4.6

4.9

Adjusted Net Income

28,500

32,248

(11.6

118,684

126,542

(6.2

Adjusted Net Income margin

10.4

13.8

11.9

13.7

Diluted EPS

0.10

0.18

(44.4

0.50

0.48

4.2

Adjusted EPS

0.31

0.35

(11.4

1.29

1.32

(2.3

Adjusted EBITDA

53,795

59,016

(8.8

209,867

220,797

(5.0

Adjusted EBITDA margin

19.6

25.2

21.1

23.9

Net cash provided by operating activities

40,658

39,775

2.2

138,888

143,670

(3.3

Free Cash Flow

20,375

31,684

(35.7

99,784

112,675

(11.4

Conversion of Adjusted EBITDA to Free Cash Flow

37.9

53.7

47.5

51.0

Adjusted Free Cash Flow

25,137

31,684

(20.7

107,357

131,016

(18.1

Conversion of Adjusted EBITDA to Adjusted Free Cash Flow

46.7

53.7

51.2

59.3

“In the fourth quarter of 2024, we generated total revenue of $274.2 million, driven by strong growth across all three Service Lines and higher-than-expected volumes from both new and existing clients across a diverse range of industries,” said Chief Financial Officer, Balaji Sekar. “For the full year 2024, we delivered $995.0 million in revenue and $209.9 million in Adjusted EBITDA, achieving an Adjusted EBITDA margin of 21.1%. Adjusted Free Cash Flow totaled $107.4 million, resulting in a strong year-end balance sheet, including $192.2 million in cash as well as $190 million in revolver capacity. Our 2024 results and early 2025 momentum have positioned us well for 2025.”

First Quarter and Full Year 2025 Outlook

For the first quarter and full year 2025 TaskUs expects its financial results to include:

2025 Outlook

First Quarter

Full Year

Revenue (in millions)

$270.0 to $272.0

$1,095 to $1,125

Revenue growth (YoY) at midpoint

19.1%

11.6%

Adjusted EBITDA Margin1

~20%

~21%

Adjusted Free Cash Flow (in millions)2

N/A

~$100

Conference Call Information

TaskUs senior management will host a conference call today to discuss the Company’s fourth quarter and full year 2024 financial results and financial outlook. This call is scheduled to begin at 5:00 pm ET. Analysts and investors who wish to participate in the call can register by visiting the following link:

https://register-conf.media-server.com/register/BI5cade07085f94ef2bded0b2f29abc38f

To listen to a live audio webcast, please visit TaskUs’ Investor Relations website at IR.Taskus.com. A replay of the audio webcast will be available on the same website for 12 months following the call. At the time of the conference call and webcast, the Company will post a slide presentation and other materials available on its website.

About TaskUs

TaskUs is a leading provider of outsourced digital services and next-generation customer experience to the world’s most innovative companies, helping its clients represent, protect and grow their brands. Leveraging a cloud-based infrastructure, TaskUs serves clients in fast-growing sectors, including social media, e-commerce, gaming, streaming media, food delivery and ride-sharing, technology, financial services and healthcare. As of December 31, 2024, TaskUs had a worldwide headcount of approximately 59,000 people across 28 locations in 12 countries, including the United States, the Philippines and India.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical facts, and further include, without limitation, statements reflecting our current views with respect to, among other things, our operations, our financial performance, our industry, the impact of the macroeconomic environment on our business, and other non-historical statements including the statements in the “First Quarter and Full Year 2025 Outlook” section of this press release. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “predicts,” “intends,” “trends,” “plans,” “estimates,” “anticipates,” “position us” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors include but are not limited to: the dependence of our business on key clients; the risk of loss of business or non-payment from clients; our failure to cost-effectively acquire new clients; the risk that we may provide inadequate service or cause disruptions in our clients’ businesses or fail to comply with the quality standards required by our clients under our agreements; our inability to anticipate clients’ needs by adapting to market and technology trends; utilization of artificial intelligence by our clients or our failure to incorporate artificial intelligence into our operations; unauthorized or improper disclosure of personal or other sensitive information, or securities breaches and incidents; negative publicity or liability or difficulty recruiting and retaining employees; our failure to detect and deter criminal or fraudulent activities or other misconduct by our employees or third parties; global economic and political conditions, especially in the social media and meal delivery and transport industries from which we generate significant revenue; the dependence of our business on our international operations, particularly in the Philippines and India; our failure to comply with applicable data privacy and security laws and regulations; fluctuations against the U.S. dollar in the local currencies in the countries in which we operate; our inability to maintain and enhance our brand; competitive pricing pressure; our dependence on senior management and key employees; increases in employee expenses and changes to labor laws; failure to attract, hire, train and retain a sufficient number of skilled employees to support operations; our inability to effectively expand our operations into countries or industries in which we have no prior operating experience and in which we may be subject to increased business, economic and regulatory risks; reliance on owned and third-party technology and computer systems; failure to maintain asset utilization levels, price appropriately and control costs; the control of affiliates of Blackstone Inc. and our Co-Founders over us; the dual class structure of our common stock; and the volatility of the market price of our Class A common stock. Additional risks and uncertainties include but are not limited to those described under “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (the “SEC”) on March 8, 2024, as such factors may be updated from time to time in our filings with the SEC, including the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, which is expected to be filed no later than March 15, 2025, which are or will be accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in the Company’s SEC filings. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made. TaskUs undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

Non-GAAP Financial Measures

TaskUs supplements results reported in accordance with United States generally accepted accounting principles (“GAAP”), with non-GAAP financial measures, such as Adjusted Net Income, Adjusted Net Income Margin, Adjusted Earnings Per Share, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, Adjusted Free Cash Flow, Conversion of Adjusted EBITDA to Free Cash Flow and Conversion of Adjusted EBITDA to Adjusted Free Cash Flow. Management believes these measures help illustrate underlying trends in TaskUs’ business and uses the measures to establish budgets and operational goals, communicate internally and externally, and manage TaskUs’ business and evaluate its performance. Management also believes that certain of these measures help investors compare TaskUs’ operating performance with its results in prior periods or assess liquidity. TaskUs anticipates that it will continue to report both GAAP and certain non-GAAP financial measures in its financial results, including non-GAAP results that exclude the impact of certain costs, losses and gains that are required to be included in our profit and loss measures under GAAP. Because TaskUs’ reported non-GAAP financial measures are not calculated in accordance with GAAP, these measures are not comparable to GAAP and may not be comparable to similarly described non-GAAP measures reported by other companies within TaskUs’ industry. Consequently, TaskUs’ non-GAAP financial measures should not be evaluated in isolation or supplant comparable GAAP measures, but rather, should be considered together with the information in TaskUs’ consolidated financial statements, which are prepared in accordance with GAAP. Definitions of non-GAAP financial measures and the reconciliations to the most directly comparable measures in accordance with GAAP are provided in subsequent sections of this press release narrative and supplemental schedules.

TaskUs, Inc.

Condensed Consolidated Statements of Income (unaudited)

(in thousands, except per share data)

Three months ended December 31,

Year ended December 31,

2024

2023

2024

2023

Service revenue

274,242

234,264

994,985

924,365

Operating expenses:

Cost of services

169,846

137,290

602,898

538,745

Selling, general, and administrative expense

67,755

48,940

239,585

228,523

Depreciation

9,698

10,889

40,223

40,391

Amortization of intangible assets

4,980

5,070

19,935

20,346

Loss (gain) on disposal of assets

550

(80

)

1,322

Total operating expenses

252,292

202,739

902,561

829,327

Operating income

21,950

31,525

92,424

95,038

Other income, net

(1,299

)

(1,745

)

(3,306

)

(1,711

)

Financing expenses

5,017

5,576

21,549

21,717

Income before income taxes

18,232

27,694

74,181

75,032

Provision for income taxes

9,373

11,417

28,311

29,342

Net income

8,859

16,277

45,870

45,690

Net income per common share:

Basic

0.10

0.18

0.52

0.49

Diluted

0.10

0.18

0.50

0.48

Weighted-average number of common shares outstanding:

Basic

89,545,980

89,189,646

88,912,835

93,938,931

Diluted

93,157,346

91,504,594

92,304,270

96,173,071

TaskUs, Inc.

Condensed Consolidated Balance Sheets (unaudited)

(in thousands)

December 31, 2024

December 31, 2023

Assets

Current assets:

Cash and cash equivalents

192,166

125,776

Accounts receivable, net of allowance for credit losses of $1,299 and $1,978, respectively

198,996

176,812

Income tax receivable

912

2,021

Prepaid expenses and other current assets

43,278

23,909

Total current assets

435,352

328,518

Noncurrent assets:

Property and equipment, net

66,775

68,893

Operating lease right-of-use assets

47,334

44,326

Deferred tax assets

8,431

4,857

Intangibles

172,525

192,958

Goodwill

216,791

218,108

Other noncurrent assets

6,090

6,542

Total noncurrent assets

517,946

535,684

Total assets

953,298

864,202

Liabilities and Shareholders’ Equity

Liabilities:

Current liabilities:

Accounts payable and accrued liabilities

53,403

26,054

Accrued payroll and employee-related liabilities

54,160

40,291

Current portion of debt

14,809

8,059

Current portion of operating lease liabilities

16,087

15,872

Current portion of income tax payable

9,839

7,451

Deferred revenue

3,727

4,077

Total current liabilities

152,025

101,804

Noncurrent liabilities:

Income tax payable

6,496

4,621

Long-term debt

241,357

256,166

Operating lease liabilities

32,946

31,475

Accrued payroll and employee-related liabilities

6,425

3,978

Deferred tax liabilities

17,046

25,214

Other noncurrent liabilities

233

Total noncurrent liabilities

304,354

321,687

Total liabilities

456,379

423,491

Total shareholders’ equity

496,919

440,711

Total liabilities and shareholders’ equity

953,298

864,202

TaskUs, Inc.

Condensed Consolidated Statement of Cash Flows (unaudited)

(in thousands)

Year ended December 31,

2024

2023

Cash flows from operating activities:

Net income

45,870

45,690

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation

40,223

40,391

Amortization of intangibles

19,935

20,346

Amortization of debt financing fees

596

Loss (gain) on disposal of assets

(80

)

1,322

Provision (benefit) for credit losses

(15

)

103

Unrealized foreign exchange losses (gains) on forward contracts

(689

)

2,485

Deferred taxes

(10,889

)

(7,959

)

Stock-based compensation expense

41,821

52,759

Changes in operating assets and liabilities:

Accounts receivable

(22,758

)

1,861

Prepaid expenses and other current assets

(20,949

)

(2,015

)

Operating lease right-of-use assets

16,109

14,314

Other noncurrent assets

(63

)

(132

)

Accounts payable and accrued liabilities

23,529

(9,825

)

Accrued payroll and employee-related liabilities

18,251

(7,877

)

Operating lease liabilities

(17,312

)

(13,823

)

Income tax payable

5,801

4,910

Deferred revenue

(347

)

592

Other noncurrent liabilities

(145

)

(68

)

Net cash provided by operating activities

138,888

143,670

Cash flows from investing activities:

Purchase of property and equipment

(39,104

)

(30,995

)

Investment in loan receivable

—

(1,000

)

Net cash used in investing activities

(39,104

)

(31,995

)

Cash flows from financing activities:

Payments for deferred business acquisition consideration

(144

)

(1,875

)

Payments on long-term debt

(8,438

)

(3,713

)

Proceeds from employee stock plans

6,261

631

Payments for taxes related to net share settlement

(4,255

)

(2,169

)

Payments for stock repurchases

(18,600

)

(111,959

)

Net cash used in financing activities

(25,176

)

(119,085

)

Increase (decrease) in cash and cash equivalents

74,608

(7,410

)

Effect of exchange rate changes on cash

(8,218

)

(806

)

Cash and cash equivalents at beginning of period

125,776

133,992

Cash and cash equivalents at end of period

192,166

125,776

TaskUs, Inc.

Non-GAAP Reconciliations

Adjusted EBITDA (unaudited)

(in thousands, except margin amounts)

Three months ended December 31,

Year ended December 31,

2024

2023

2024

2023

Net income

8,859

16,277

45,870

45,690

Provision for income taxes

9,373

11,417

28,311

29,342

Financing expenses

5,017

5,576

21,549

21,717

Depreciation

9,698

10,889

40,223

40,391

Amortization of intangible assets

4,980

5,070

19,935

20,346

EBITDA

37,927

49,229

155,888

157,486

Transaction costs(1)

—

245

Earn-out consideration(2)

—

7,863

Foreign currency losses (gains)(3)

(890

)

(885

)

1,302

431

Loss (gain) on disposal of assets

550

(80

)

1,322

Severance costs(4)

—

224

487

1,852

Litigation costs(5)

8,393

—

15,423

—

Stock-based compensation expense(6)

9,957

10,454

42,391

53,179

Interest income(7)

(1,605

)

(556

)

(5,544

)

(1,581

)

Adjusted EBITDA

53,795

59,016

209,867

220,797

Net Income Margin(8)

3.2

6.9

4.6

4.9

Adjusted EBITDA Margin(8)

19.6

25.2

21.1

23.9

(1)

Represents professional service fees related to non-recurring transactions.

(2)

Represents earn-out consideration recognized as compensation expense related to the acquisition of heloo.

(3)

Realized and unrealized foreign currency losses include the effect of fair market value changes of forward contracts not designated as hedging instruments and remeasurement of U.S. dollar-denominated accounts to foreign currency.

(4)

Represents severance payments as a result of certain cost optimization measures we undertook during the period to restructure support roles.

(5)

Represents only those litigation costs that are considered non-recurring and outside of the ordinary course of business.

(6)

Represents stock-based compensation expense, as well as associated payroll tax.

(7)

Represents interest earned on short-term savings, time-deposits and money market funds.

(8)

Net Income Margin represents net income divided by service revenue and Adjusted EBITDA Margin represents Adjusted EBITDA divided by service revenue.

TaskUs, Inc.

Non-GAAP Reconciliations

Adjusted Net Income (unaudited)

(in thousands, except margin amounts)

Three months ended December 31,

Year ended December 31,

2024

2023

2024

2023

Net income

8,859

16,277

45,870

45,690

Amortization of intangible assets

4,980

5,070

19,935

20,346

Transaction costs(1)

—

245

Earn-out consideration(2)

—

7,863

Foreign currency losses (gains)(3)

(890

)

(885

)

1,302

431

Loss (gain) on disposal of assets

550

(80

)

1,322

Severance costs(4)

—

224

487

1,852

Litigation costs(5)

8,393

—

15,423

—

Stock-based compensation expense(6)

9,957

10,454

42,391

53,179

Tax impacts of adjustments(7)

(2,812

)

558

(6,644

)

(4,386

)

Adjusted Net Income

28,500

32,248

118,684

126,542

Net Income Margin(8)

3.2

6.9

4.6

4.9

Adjusted Net Income Margin(8)

10.4

13.8

11.9

13.7

(1)

Represents professional service fees related to non-recurring transactions.

(2)

Represents earn-out consideration recognized as compensation expense related to the acquisition of heloo.

(3)

(4)

Represents severance payments as a result of certain cost optimization measures we undertook during the period to restructure support roles.

(5)

Represents only those litigation costs that are considered non-recurring and outside of the ordinary course of business.

(6)

Represents stock-based compensation expense, as well as associated payroll tax.

(7)

Represents tax impacts of adjustments to net income which resulted in a tax benefit during the period, including stock-based compensation expense, earn-out consideration, litigation costs and severance. After these adjustments, we applied a non-GAAP effective tax rate of 33.3% and 28.3% for the three months ended December 31, 2024 and 2023, respectively, and 26.4% and 24.5% for the year ended December 31, 2024 and 2023, respectively, to non-GAAP income before income taxes.

(8)

Net Income Margin represents net income divided by service revenue and Adjusted Net Income Margin represents Adjusted Net Income divided by service revenue.

TaskUs, Inc.

Non-GAAP Reconciliations

Adjusted EPS (unaudited)

Three months ended December 31,

Year ended December 31,

2024

2023

2024

2023

Diluted EPS

0.10

0.18

0.50

0.48

Per share adjustments to net income(1)

0.21

0.17

0.79

0.84

Adjusted EPS

0.31

0.35

1.29

1.32

Weighted-average common shares outstanding – diluted

93,157,346

91,504,594

92,304,270

96,173,071

(1)

Reflects the aggregate adjustments made to reconcile net income to Adjusted Net Income, as noted in the above table, divided by the GAAP diluted weighted-average number of shares outstanding for the relevant period.

TaskUs, Inc.

Non-GAAP Reconciliations

Free Cash Flow (unaudited)

($ in thousands)

Three months ended December 31,

Year ended December 31,

2024

2023

2024

2023

Net cash provided by operating activities

40,658

39,775

138,888

143,670

Purchase of property and equipment

(20,283

)

(8,091

)

(39,104

)

(30,995

)

Free Cash Flow

20,375

31,684

99,784

112,675

Payment for earn-out consideration

—

18,341

Payment for litigation costs

4,762

—

7,573

—

Adjusted Free Cash Flow

25,137

31,684

107,357

131,016

Conversion of Adjusted EBITDA to Free Cash Flow(1)

37.9

53.7

47.5

51.0

Conversion of Adjusted EBITDA to Adjusted Free Cash Flow(1)

46.7

53.7

51.2

59.3

(1)

Conversion of Adjusted EBITDA to Free Cash Flow represents Free Cash Flow divided by Adjusted EBITDA. Conversion of Adjusted EBITDA to Adjusted Free Cash Flow represents Adjusted Free Cash Flow divided by Adjusted EBITDA.

Definitions of Non-GAAP Metrics

EBITDA and Adjusted EBITDA

EBITDA is a non-GAAP profitability measure that represents net income or loss for the period before the impact of the benefit from or provision for income taxes, financing expenses, depreciation, and amortization of intangible assets. EBITDA eliminates potential differences in performance caused by variations in capital structures (affecting financing expenses), tax positions (such as the availability of net operating losses against which to relieve taxable profits), the cost and age of tangible assets (affecting relative depreciation expense) and the extent to which intangible assets are identifiable (affecting relative amortization expense).

Adjusted EBITDA is a non-GAAP profitability measure that represents EBITDA before certain items that are considered to hinder comparison of the performance of our business on a period-over-period basis or with other businesses. During the periods presented, we excluded from Adjusted EBITDA transaction costs, earn-out consideration, the effect of foreign currency gains and losses, gains and losses on disposals of assets, non-recurring severance costs, certain non-recurring litigation costs, stock-based compensation expense and associated employer payroll tax and interest income, which include costs that are required to be expensed in accordance with GAAP. Our management believes that the inclusion of supplementary adjustments to EBITDA applied in presenting Adjusted EBITDA are appropriate to provide additional information to investors about certain material non-cash items and about unusual items that we do not expect to continue at the same level in the future.

Adjusted EBITDA Margin represents Adjusted EBITDA divided by service revenue.

Adjusted Net Income

Adjusted Net Income is a non-GAAP profitability measure that represents net income or loss for the period before the impact of amortization of intangible assets and certain items that are considered to hinder comparison of the performance of our business on a period-over-period basis or with other businesses. During the periods presented, we excluded from Adjusted Net Income amortization of intangible assets, transaction costs, earn-out consideration, the effect of foreign currency gains and losses, gains and losses on disposals of assets, non-recurring severance costs, certain non-recurring litigation costs, stock-based compensation expense and associated employer payroll tax and the related effect on income taxes of certain pre-tax adjustments, which include costs that are required to be expensed in accordance with GAAP. Our management believes that the inclusion of supplementary adjustments to net income applied in presenting Adjusted Net Income are appropriate to provide additional information to investors about certain material non-cash items and about unusual items that we do not expect to continue at the same level in the future.

Adjusted Net Income Margin represents Adjusted Net Income divided by service revenue.

Adjusted EPS

Adjusted EPS is a non-GAAP profitability measure that represents earnings available to shareholders excluding the impact of certain items that are considered to hinder comparison of the performance of our business on a period-over-period basis or with other businesses. Adjusted EPS is calculated as Adjusted Net Income divided by our diluted weighted-average number of shares outstanding. Our management believes that the inclusion of supplementary adjustments to earnings per share applied in presenting Adjusted EPS are appropriate to provide additional information to investors about certain material non-cash items and about unusual items that we do not expect to continue at the same level in the future.

Free Cash Flow and Adjusted Free Cash Flow

Free Cash Flow is a non-GAAP liquidity measure that represents our ability to generate additional cash from our business operations. Free Cash Flow is calculated as net cash provided by operating activities in the period minus cash used for purchase of property and equipment in the period. Our management believes that the inclusion of this non-GAAP measure, when considered with our GAAP results, provides management and investors with an additional understanding of our ability to generate additional cash for ongoing business operations and other capital deployment.

Adjusted Free Cash Flow is a non-GAAP liquidity measure that represents Free Cash Flow before the payment of earn-out consideration and certain litigation costs, that are considered non-recurring and outside of the ordinary course of business, which would hinder comparison of the performance of our business on a period-over-period basis or with other businesses. Our management believes that the inclusion of these supplementary adjustment to Free Cash Flow are appropriate to provide additional information to investors about these unusual items that we do not expect to continue at the same level in the future.

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