Thryv Q2 2026 Earnings: SaaS Mix Reaches 76% as Revenue Falls 28%

Thryv Holdings (NASDAQ: THRY) reported Q2 2026 revenue of $150.7 million, down 28.4% year over year, while diluted EPS swung to a loss of $0.38 from earnings of $0.31. The decline was concentrated in Marketing Services, while SaaS revenue was nearly flat and accounted for 76% of the smaller consolidated revenue base. Adjusted EBITDA fell 59.4% to $20.8 million, and Thryv announced a restructuring plan intended to align costs with its SaaS operating model.

Core Earnings Results

For the quarter ended June 30, 2026, the $59.7 million decline in consolidated revenue was almost entirely attributable to Marketing Services. Lower operating expenses did not offset the reduction in gross profit, resulting in a $1.1 million operating loss compared with operating income of $29.5 million a year earlier.

Thryv also recorded a $7.2 million income tax expense despite a $9.5 million pretax loss, widening the GAAP net loss to $16.7 million. Adjusted EBITDA remained positive but declined faster than revenue as its margin contracted by 10.5 percentage points.

Adjusted EBITDA and free cash flow are non-GAAP measures. Thryv’s Q2 Adjusted EBITDA reconciliation included $8.3 million of restructuring and integration expenses, along with interest, taxes, depreciation, amortization and other adjustments.

Business and Segment Performance

SaaS became a larger part of Thryv’s business because Marketing Services contracted sharply, not because SaaS revenue expanded. SaaS revenue declined only 0.5%, but its gross margin and Adjusted EBITDA margin both fell materially. Marketing Services experienced larger declines across revenue and Adjusted EBITDA.

Within SaaS, the Market, Sell and Grow initiatives increased 21% excluding Keap, but that growth was offset by headwinds in legacy CRM products. Monthly SaaS ARPU rose 11.9% to $394, while the company ended the quarter with 95,000 SaaS clients.

Seasoned net revenue retention was 90%, meaning revenue from the seasoned customer cohort was 90% of its prior-year level under Thryv’s definition. Customers contributing more than $400 in monthly recurring revenue represented 72% of SaaS revenue. The retention and quality-customer metrics exclude Keap, while the reported ARPU includes Keap.

Profitability, Cash Flow and the Balance Sheet

The gross-margin contraction was the main source of earnings pressure. Consolidated gross margin declined to 62.7% from 69.7%, while sales and marketing and general and administrative expenses decreased in absolute dollars. Those expense reductions were insufficient to compensate for the lower gross profit generated by the smaller revenue base.

Quarterly cash generation remained positive but weakened year over year. On a six-month basis, however, operating cash flow increased to $27.4 million from $19.1 million, and free cash flow rose to $11.2 million from $4.2 million. These year-to-date figures should not be mixed with the quarterly cash-flow comparison above.

Thryv held $9.1 million of cash and cash equivalents at June 30, 2026. Reported term-loan and ABL balances totaled approximately $243.7 million, while the current portions of its term loans increased to $35.0 million from $17.5 million at the end of 2025.

Restructuring Costs Arrive Before the Planned Savings

Thryv expects its newly announced restructuring plan to generate approximately $55 million to $60 million in gross annualized savings upon completion, but the savings are not expected to begin until 2027. The company expects total restructuring and related charges of $20 million to $25 million, with about 10% already incurred, approximately 40% scheduled for the second half of 2026 and the remaining 50% expected in 2027.

Management said the plan will realign the cost structure around a SaaS operating model and concentrate investment on the Thryv Growth Platform and its AI capabilities. CFO Paul Rouse said the initiatives are expected to support future Adjusted EBITDA margins and free cash flow, although the disclosed savings are gross rather than net benefits.

Earnings Guidance

Thryv issued Q3 guidance and updated its full-year 2026 outlook. The supplied release does not include the previous full-year ranges, so the size and direction of the update cannot be quantified.

The Q3 ranges imply sequential declines from Q2 for both segments’ revenue and Adjusted EBITDA. Q4 Marketing Services revenue is projected to recover from the Q3 range, while the upper end of Q4 SaaS revenue guidance remains slightly below the Q2 result.

The forward-looking segment Adjusted EBITDA measures are non-GAAP, and Thryv did not provide quantitative GAAP reconciliations because the excluded prospective items were not available without unreasonable effort.

Recent Insider Transactions

The supplied transaction detail lists six director stock awards on June 11, a derivative conversion by the CFO in May and three open-market purchases in March. All ten entries were reported as direct holdings, and no sale appears among them; stock awards reported at $0 should not be interpreted as open-market purchases.

Risks Investors Should Watch

• SaaS retention and legacy-product pressure: Seasoned net revenue retention was 90%, and growth in the Market, Sell and Grow initiatives did not fully offset weakness in legacy CRM products.
• Lower SaaS profitability: SaaS revenue was nearly flat, but SaaS gross margin declined 8.6 percentage points and its Adjusted EBITDA fell 42%, indicating that revenue stability has not translated into stable profitability.
• Continued Marketing Services contraction: The segment’s 62% revenue decline was the principal driver of the consolidated revenue decrease and reduced its contribution to companywide cash earnings.
• Restructuring execution and timing: Thryv will recognize most of the planned charges before savings begin in 2027, creating a gap between near-term costs and the expected benefits.
• Limited cash relative to borrowings: Cash totaled $9.1 million compared with approximately $243.7 million of reported term-loan and ABL balances, while current term-loan portions increased during the first half.

Summary

Thryv’s Q2 2026 results showed that the shift toward SaaS is advancing as a percentage of revenue, but not yet through consolidated growth. Marketing Services contracted sharply, SaaS retention and margins remained under pressure, and Adjusted EBITDA declined faster than revenue. The main issues to monitor are whether the Thryv Growth Platform can restore SaaS growth, whether segment margins stabilize and whether the restructuring produces its planned savings without weakening near-term cash generation.