TTEC Holdings, Inc.

Thank you for standing by. The conference will begin momentarily. Until such time, you will hear music. Thank you and please continue to stand by. Welcome to T-TECH's second quarter 2025 earnings conference call. I would like to remind all parties that you will be in a listen only mode until the question and answer session. This call has been recorded at the request of T-TECH. I would now like to turn the call over to Bob Bilnup, T-TECH's group vice president, call for finance. Thank you sir and you may begin.

Good morning and thank you for joining us today. T-TECH is hosting this call to discuss its second quarter results for the period ended June 30th, 2025. Participating on today's call are Ken Tuchman, chairman and chief executive officer of T-TECH and Kenny Wagers, chief financial officer of T-TECH. Yesterday, T-TECH issued a press release announcing its financial results. While this call will reflect items discussed in that document, for complete information about our financial performance, we also encourage you to read our quarterly report on Form 10Q for the period ended on June 30th, 2025. Before we begin, I want to remind you that matters discussed on today's call may include forward-looking statements related to our operating performance, financial goals, and business outlook, which are based on management's current beliefs and assumptions. Please note that these forward-looking statements reflect our opinions as of the date of this call and we undertake no obligation to update this information as a result of new developments that may occur. Forward-looking statements are subject to various risks, uncertainties, and other factors that could cause our actual results to differ materially from those expected and described today. I would also like to mention that before the discussions about our results of operations for the second quarter 2025, Mr. Tuchman will make a brief statement about his decision to withdraw the preliminary proposal to take T-TECH private. Other than that statement, which Mr. Tuchman is making in his individual capacity, the company will not be commenting on the T-TECH private proposal, nor will we take any questions about it. For a more detailed description of our risk factors, please review our 2024 Annual Report on Form 10K. A replay of this conference call will be available on our website under the Investor Relations section. I will now turn the call over to Ken.

Good morning and thank you for joining us today. Before we turn to our results, I wanted to say a word about the preliminary proposal I made to take the company private and the decision announced last week to withdraw that proposal. I think it's clear to everyone on this call that I'm fully committed to T-TECH and its long-term success. I founded the company, I'm its largest shareholder, and I've dedicated my entire career to T-TECH. While I had hoped to be able to achieve the transaction, this turned out not to be possible on acceptable terms in current market conditions. Please know that I remain fully committed to our company, employees, customers, partners, and of course to our investors. I look forward to great things from T-TECH in the future, and as I think you will see from the results we're announcing today, the business is headed in a positive direction. As I'm sure you'll appreciate, we are solely focused on the execution of T-TECH's go-forward strategy. As the discussions regarding the take private have now formally ceased, I won't have anything else to say on this topic. Now on to our results. In the second quarter of 2025, revenue was $514 million. Adjusted EBITDA was $52 million, a 12% -over-year increase, and a 140 basis point margin improvement. To 10.1%. And free cash flow was $86 million, further contributing to a meaningful reduction in our borrowings. In partnership with my seasoned CX leadership team, we're making good progress on our strategic plan to return our business to its historic growth rates and overall financial strength. Across both T-TECH business units, we will continue to expand our AI and analytics capabilities, diversify our CX technology partner network, and attract high quality talent, and deepen our role as the go-to CX transformation partner for clients across the globe. Agentic AI and analytics are revolutionizing our industry and creating exciting opportunities for us internally and externally for our clients. The potential for AI to simplify business processes, personalize interactions, and augment human capabilities is vast. Right now, however, even the most sophisticated brands are struggling to define a clear path forward. Their challenge is not one of vision, but readiness, organizational flexibility, strong data governance, and an agile yet secure cloud-based infrastructure are foundational for success. It takes time to reshape organizations and get these systems and processes right. Consider these recent shifts. Contrary to some CX industry reports, global consulting group CAVEL projects a 10% increase in demand for contact center associates over the next three years, from 15.3 million in 2025 to 16.8 million contact center associates. In addition, technology analyst from Gartner predicts that by 2027, over half of the businesses that were planning to replace customer support associates with automation will reconsider. Their report indicates that companies relying too heavy on AI risk failure due to unexpected cost, organizational misalignment, and customer dissatisfaction. This course correction in the market underlines several realities we've always known. Rearchitecting processes is complicated. Eliminating operational silos and interconnecting systems is challenging and time consuming. Successfully integrating technologies into workflows is easier said than done. Having a modern data state is a critical and in most cases is barely even nascent. And finally, people want to interact with empowered people when they need help navigating complex, emotional, and highly valuable interactions. Years of preparing for AI's potential have positioned us well to guide clients through this complex and rapidly moving landscape. Increasingly, companies are looking outside their organizations for seasoned experts like us to help them implement AI-enabled programs that will reduce risk and deliver strong business outcomes. During times of disruption, our stellar credentials, deep technology and analytics expertise, and decades of frontline CX experience are attracting new clients and strengthening relationships with our existing ones. With our digital first approach, we're thoughtfully deploying AI internally across our entire organization and implementing AI externally where it makes sense for our clients. Across our two business segments, we're designing, building, implementing, and operating scalable, data-driven solutions where AI and people work together to grow revenue, reduce cost, and build lasting customer loyalty for our clients. Let me share how. We'll start with our CX management services through T-Tech Engage. Demand for our AI-enabled services continues to grow. This quarter, we onboarded several new clients while also increasing our pipeline. Notably, several of the new wins are with established brands that are piloting outsourcing for the first time. And although these programs often launch on a modest scale, they quickly gain momentum and expand as we demonstrate meaningful results. Over the last 18 months, we've secured 15 new large enterprise clients with substantial growth potential. Nine have already expanded their business with us, including three have more than doubled their initial spend. Our long-standing clients continue to rely on us as they evolve, leveraging our technology expertise and strong operations. We continue to grow share of our wallet with them. As we continue to deliver exceptional results for our clients, we're being awarded work in new areas of their business. In the first half of this year alone, we've sold 150% more in these new areas for clients as compared to all of last year. Here are just a few of the many ways we're using technology to innovate with our clients. For a customer-obsessed home improvement retailer, we're applying AI-based accent neutralization technology to strengthen the customer experience by improving the clarity of communication from anywhere in the world. For a top-tier financial services client, we're helping them improve their customer experience using data analytics to prioritize the most effective channel of engagement. And for a telecom giant, we're driving growth at the top of the funnel with data-driven sales motions for their new mission-critical solution offering. AI is now integral to our operations, automating and optimizing functions across the board. However, just like our clients, getting the most out of AI is a multi-year journey that requires diligence, flexibility, and time. As we continue to refine our processes, we're seeing operational gains, new opportunities, better commercial alignment, and improved results. For example, our talent acquisition team is enhancing our candidate screening process with AI to give recruiters more time to find and hire the right people with the problem-solving skills and compassion needed to build lasting customer engagement and loyalty. Our new AI-assisted curriculum wizards are enabling our instructional designers to dramatically improve the quality of client-supplied training materials with more compelling and engaging content. We are able to build learning journeys that reduce unproductive time in training classes and accelerate speed to proficiency for our associates. And our AI-enabled performance management platform, T-Tech Perform, provides personalized real-time coaching. It has been deployed across numerous client programs and delivering a double-digit improvements in handle time, quality, attrition, and employee engagement. Now let's turn to our CX consulting and technology segment, T-Tech Digital, where we continue to see rapid evolution in client priorities. This shift reflects a broader market trend. Rather than replacing core systems, clients are layering AI capabilities onto their current environments to drive targeted outcomes. These engagements are often smaller in initial scope and are faster to deploy than traditional CCAS implementations. They are highly strategic, frequently expanding into multi-phase programs, and generating recurring managed service opportunities as clients seek to maintain and optimize their AI, analytics, and technology investments. While this transition is creating a short-term impact on revenue due to the shift in mix and deal types, it positions us for stronger long-term performance. These AI-led engagements align with our strengths in consulting, orchestration, large-scale data models, and managed services. And they will carry higher gross margins and deeper client engagement over time. Recent wins demonstrate how our portfolio of capabilities are helping clients make the leap from operating a legacy contact center to managing a dynamic AI-enabled customer interaction hub. For example, for a leading healthcare organization, we're designing the future member experience, integrating disparate systems, and enabling modern AI capabilities. This is a multi-year partnership with strong potential for expansion. For a global financial services client, we're implementing a new customer data platform to unlock AI benefits and lower cost, leveraging our experience and knowledge of their specific infrastructure and requirements. And we just went live with a modern data estate for a large travel and hospitality brand. The unified database connects a myriad of online and offline sources to provide a complete and seamless view of the customer journey. The system enables complex customer segmentation and sophisticated offer customization and is already creating new sources of revenues for our client. Now I'd like to move on to our progress with our IP development. Oftentimes our work uncovers unmet client needs, fueling collaboration with technology partners and development through our own proprietary software team. With experience across all the major CX technologies, our full-stack developers are building and deploying purpose-driven solutions across platforms. We make these proprietary technologies available in the open market through app stores and marketplaces. For example, our team just developed and completed our AI Gateway Solution to give companies access to powerful AI functionality with minimal risk and cost. This proprietary middleware reduces integration time and cost by up to 75% with any legacy or modern contact center platform. Early adopters are already seeing accelerated time to value, risk reduction and enhance customer experience. As the industry evolves through this period of rapid transition, every business is seeking a path forward. CX leaders are looking for expert advisors to help them build and implement their road maps with proper guardrails to protect their business and their customers. Whether clients need human associates, agentic AI or a combination of both, we're ready to help them move confidently into the future with solutions that are practical, secure and scalable. Although we're pleased with our progress, we see ample opportunity for ongoing advancement. We're continuing to focus on improving our margins by optimizing operations, implementing new technology and improved process across our organization and doubling down on our data-driven approach to decision-making. Every day, we're helping build the next era of customer experience alongside our clients, partners and talented teams. I'm encouraged by the progress and excited by what lies ahead. Every organization today faces a mandate to transform now. We're ready and well positioned to help our clients lead the way. On behalf of our board of directors and our teams of CX engineers, architects, data analysts, trainers and frontline brand ambassadors worldwide, thank you for your continued support. And now I'll hand the call off to Kenney.