Harte Hanks Reports Third Quarter 2025 Results

Rhea-AI Summary

Harte Hanks (NASDAQ:HHS) reported Q3 2025 results for the quarter ended September 30, 2025. Revenue was $39.5M vs $47.6M in Q3 2024, and the company recorded a net loss of $2.3M ($0.31 per diluted share) versus net income of $0.1M a year earlier. Operating expenses fell 14.7% to $39.0M, and Adjusted EBITDA was $2.4M versus $4.1M in Q3 2024.

Balance sheet items include $6.5M cash, no debt, and up to $24M available on the credit facility; the facility maturity was extended to June 30, 2028 with an accordion to pursue an additional $10M. Management highlighted a new Samsung partnership and expects Q4 sequential improvement as new business converts.

Positive

• Operating expenses down 14.7% year over year
• Year-to-date net loss improved from $27.9M to $3.0M
• Ended Q3 with $6.5M cash and zero debt
• Credit facility extended to June 30, 2028 with up to $24M capacity and a $10M accordion
• Fulfillment & Logistics segment EBITDA increased from $1.3M to $2.3M

Negative

• Quarterly revenue declined 17% to $39.5M from $47.6M
• Adjusted EBITDA fell from $4.1M to $2.4M year over year
• Net loss of $2.3M in Q3 2025 versus net income of $0.1M in Q3 2024
• Marketing Services revenue declined 33.4% year over year
• Customer Care revenue declined 11.6% year over year and segment EBITDA halved

Insights

Senior Corporate Finance Analyst

Results show revenue declines and a small net loss but improved costs, positive EBITDA, and a new Samsung partnership providing pipeline momentum.

Revenue for Q3 fell to $39.5 million from $47.6 million year‑over‑year, driven by timing and program transitions; operating expenses declined to $39.0 million, down 14.7%, which narrowed the operating gap and produced EBITDA of approximately $1.7 million and Adjusted EBITDA of $2.4 million. The company finished the quarter with $6.5 million in cash, zero debt, and up to $24.0 million available on its credit facility, and it extended the facility maturity to June 30, 2028.

Near‑term progress depends on conversion of late‑stage opportunities and implementation of new programs such as the Samsung engagement in Greenville, South Carolina; these items are explicitly cited as contributing to sequential improvement in Q4 2025 and beyond. Risks named in the release include program turnover and lingering year‑over‑year revenue declines across segments; the firm cites cost discipline and operational efficiencies as the primary mitigation. Watch revenue trends and segment EBITDA in Customer Care and Fulfillment for concrete signs of recovery, and monitor quarterly cash, credit availability, and any disclosed implementation timelines for the Samsung program over the next two quarters (Q4 2025 to Q1 2026).

Highlights Strong Pipeline Replenishment and Momentum with New Samsung Partnership

CHELMSFORD, MASSACHUSETTS / ACCESS Newswire / November 10, 2025 / Harte Hanks, Inc. (NASDAQ:HHS), a leading global customer experience company focused on bringing companies closer to customers for over 100 years, today announced financial results for the third quarter ended September 30, 2025.

Third Quarter Highlights

• Revenue: $39.5 million compared to $47.6 million in Q3 2024, reflecting timing and program transitions across legacy customer contracts.

• Operating Expenses: $39.0 million, down 14.7% year over year, driven by continued cost improvements under management's strategic realignment to offset revenue decline. Operating expenses in Q3 2024 were $45.7 million.

• Net loss: $2.3 million (or $0.31 per diluted share) versus net income of $0.1 million ($0.02 per diluted share) in Q3 2024.

• EBITDA: approximately $1.7 million, with Adjusted EBITDA, excluding stock-based compensation, severance and restructuring costs, totaling $2.4 million. By comparison, EBITDA in Q3 2024 was $2.9 million, and Adjusted EBITDA was $4.1 million.

• Cash & Liquidity: $6.5 million in cash and cash equivalents; zero debt outstanding; up to $24 million available under the Company's credit facility.

• Working Capital: $15.7 million in positive working capital for operations.

• Credit Facility Extended: The Company amended its credit facility with Texas Capital Bank on June 24, 2025, extending maturity to June 30, 2028 and adding an accordion feature that allows the Company to seek up to a $10 million increase in capacity under the current credit line.

Year-to-Date 2025 Results

• Revenue: $119.7 million versus $138.1 million for the same period in 2024.

• Operating Expenses: $119.2 million down from $134.5 million in 2024.

• Net Loss: $3.0 million ($0.41 per diluted share) versus $27.9 million in 2024 ($3.83 per diluted share, which included a one-time $37.5 million pension termination charge).

Management Commentary

"We're encouraged by the momentum of our Customer Care segment, where the opening of our new Greenville, South Carolina facility with Samsung Electronics America marks a significant step forward in replenishing our pipeline with blue-chip, scalable programs," said David Fisher, President. "This engagement exemplifies the higher-value partnerships we're targeting combining technology-enabled service delivery with a 'more human' approach to customer experience. With additional late-stage opportunities nearing conversion, we expect these wins to contribute to sequential improvement in Q4 and beyond."

David Garrison, Chief Financial Officer, added, "Our extended credit facility and cost discipline efforts provide flexibility to navigate program turnover from a position of strength. We expect Q4 to reflect the benefit of new business and client expansions now progressing through implementation. We remain focused on driving long-term margin improvement and prudent capital allocation to enhance shareholder value."

Segment Highlights

• Customer Care (approx. 29% of Total Revenue): Third quarter segment revenues were $11.6 million, representing a modest sequential decline of 2.5% from the prior quarter, and an 11.6% decline from $13.1 million in Q3 2024. Segment EBITDA was approximately $1.1 million in Q3 2025 compared to $2.5 million in the same period of the prior year. The segment remains profitable and well positioned with expanding opportunities from strategic clients and new programs in development. Subject to customary seasonality, we expect steady revenue in Q4 2025 and sequential improvement throughout 2026

• Marketing Services (22% of Total Revenue): Third quarter segment revenues were $8.8 million, reflecting a sequential increase of 1.9% from the prior quarter, and a 33.4% decline from $13.3 million in Q3 2024. Segment EBITDA was approximately $1.8 million in Q3 2025 compared to $2.8 million in the same period of the prior year. Although year-over-year results were affected by industry-wide marketing budget discipline, the segment remains profitable and is benefiting from strategic account realignments to initiate growth in 2026.

• Fulfillment & Logistics Services (49% of Total Revenue): Third quarter segment revenues were $19.1 million, reflecting a sequential increase of 5.6% from the prior quarter, and a 10.2% decrease from $21.3 million in Q3 2024. Segment EBITDA was $2.3 million in Q3 2025 compared to $1.3 million in the same period of the prior year. While revenues were lower than Q3 2024 due to completion of certain customer projects, the segment remains resilient, supported by ongoing operational efficiencies, disciplined pricing strategies, and a pipeline of new and expanding customer opportunities.

Outlook

Harte Hanks continues to expect positive EBITDA for full-year 2025, supported by ongoing cost reductions and operational efficiencies under management-driven initiatives. The Company is actively working to replenish the pipeline with new client opportunities and expansions, with management expecting fourth-quarter results to begin reflecting initial progress as the business development pipeline converts in Customer Care and Fulfillment.

The recently announced partnership with Samsung Electronics America, serviced through Harte Hanks' new Greenville, South Carolina facility, represents an early tangible milestone in this strategy, illustrating how operational discipline and targeted investment in high-quality client relationships are fueling the next stage of growth.

Balance Sheet and Liquidity

Harte Hanks ended the third quarter with $6.5 million in cash and cash equivalents and $24.0 million of capacity on its credit line. The Company has no outstanding debt as of September 30, 2025. The Company's continued strong cash position and ability to borrow underscore its strong financial foundation and provide meaningful opportunities for the Company to invest in growth, innovation, and shareholder value initiatives in Q4 and beyond.

About Harte Hanks

Harte Hanks (NASDAQ:HHS) is a leading global customer experience company whose mission is to partner with clients to provide them with CX strategy, data-driven analytics and actionable insights combined with seamless program execution to better understand, attract and engage their customers.

With a legacy spanning over a century, Harte Hanks delivers integrated solutions across Customer Care, Fulfillment & Logistics, and Marketing Services, leveraging deep vertical expertise, a global footprint, and proprietary platforms to create enduring value for leading brands. Clients include GlaxoSmithKline, Unilever, Samsung, Pfizer, HBO Max, Volvo, Ford, FedEx, Midea, and IBM among others. Headquartered in Chelmsford, Massachusetts, Harte Hanks has approximately 2,200 employees in offices across the Americas, Europe, and Asia Pacific.

For more information, visit hartehanks.com

As used herein, "Harte Hanks" or "the Company" refers to Harte Hanks, Inc. and/or its applicable operating subsidiaries, as the context may require. Harte Hanks' logo and name are trademarks of Harte Hanks, Inc.

Cautionary Note Regarding Forward-Looking Statements:

Our press release and related earnings conference call contain "forward-looking statements" within the meaning of U.S. federal securities laws. All such statements are qualified by this cautionary note, provided pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements other than historical facts are forward-looking and may be identified by words such as "may," "will," "expects," "believes," "anticipates," "plans," "estimates," "seeks," "could," "intends," or words of similar meaning. These forward-looking statements are based on current information, expectations and estimates and involve risks, uncertainties, assumptions and other factors that are difficult to predict and that could cause actual results to vary materially from what is expressed in or indicated by the forward-looking statements. In that event, our business, financial condition, results of operations or liquidity could be materially adversely affected and investors in our securities could lose part or all of their investments. These risks, uncertainties, assumptions and other factors include: (a) local, national and international economic and business conditions, including (i) market conditions that may adversely impact marketing expenditures, and (ii) the impact of economic environments and competitive pressures on the financial condition, marketing expenditures and activities of our clients and prospects; (iii) the demand for our products and services by clients and prospective clients, including (iv) the willingness of existing clients to maintain or increase their spending on products and services that are or remain profitable for us, and (v) our ability to predict changes in client needs and preferences; (b) economic and other business factors that impact the industry verticals we serve, including competition, inflation and consolidation of current and prospective clients, vendors and partners in these verticals; (c) our ability to manage and timely adjust our facilities, capacity, workforce and cost structure to effectively serve our clients; (d) our ability to improve our processes and to provide new products and services in a timely and cost-effective manner though development, license, partnership or acquisition; (e) our ability to protect our facilities against security breaches and other interruptions and to protect sensitive personal information of our clients and their customers; (f) our ability to respond to increasing concern, regulation and legal action over consumer privacy issues, including changing requirements for collection, processing and use of information; (g) the impact of privacy and other regulations, including restrictions on unsolicited marketing communications and other consumer protection laws; (h) fluctuations in fuel prices, paper prices, postal rates and postal delivery schedules; (i) the number of shares, if any, that we may repurchase in connection with our repurchase program; (j) unanticipated developments regarding litigation or other contingent liabilities; (k) our ability to complete reorganizations, including cost-saving initiatives; and (l) other factors discussed from time to time in our filings with the Securities and Exchange Commission, including under "Item 1A. Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2024 which was filed on March 17, 2025. The forward-looking statements in this press release and our related earnings conference call are made only as of the date hereof, and we undertake no obligation to update publicly any forward-looking statement, even if new information becomes available or other events occur in the future.

Supplemental Non-GAAP Financial Measures:

The Company reports its financial results in accordance with generally accepted accounting principles ("GAAP"). However, the Company may use certain non-GAAP measures of financial performance in order to provide investors with a better understanding of operating results and underlying trends to assess the Company's performance and liquidity in this press release and our related earnings conference call. We have presented herein a reconciliation of these measures to the most directly comparable GAAP financial measure.

The Company presents the non-GAAP financial measure "Adjusted Operating Income" as a useful measure to both management and investors in their analysis of the Company's financial results because it facilitates a period-to-period comparison of Operating Income excluding stock-based compensation, severance, and restructuring. The most directly comparable measure for this non-GAAP financial measure is Operating Income.

The Company presents the non-GAAP financial measure "EBITDA" as a supplemental measure of operating performance in order to provide an improved understanding of underlying performance trends. The Company defines "EBITDA" as Net Income adjusted to exclude income tax expense, other expense (income), net, and depreciation and amortization expense. The Company defines "Adjusted EBITDA" as EBITDA adjusted to exclude stock-based compensation, severance, and restructuring. The most directly comparable measure for EBITDA and Adjusted EBITDA is Net Income. We believe EBITDA and Adjusted EBITDA are an important performance metric because it facilitates the analysis of our results, exclusive of certain non-cash items, including items which do not directly correlate to our business operations; however, we urge investors to review the reconciliation of non-GAAP EBITDA to the comparable GAAP Net Income, which is included in this press release, and not to rely on any single financial measure to evaluate the Company's financial performance.

The use of non-GAAP measures does not serve as a substitute and should not be construed as a substitute for GAAP performance but should provide supplemental information concerning our performance that our investors and we find useful. The Company evaluates its operating performance based on several measures, including these non-GAAP financial measures. The Company believes that the presentation of these non-GAAP financial measures in this press release and earnings conference call presentations are useful supplemental financial measures of operating performance for investors because they facilitate investors' ability to evaluate the operational strength of the Company's business. However, there are limitations to the use of these non-GAAP measures, including that they may not be calculated the same by other companies in our industry limiting their use as a tool to compare results. Any supplemental non-GAAP financial measures referred to herein are not calculated in accordance with GAAP and they should not be considered in isolation or as substitutes for the most comparable GAAP financial measures.

Investor Relations Contact:

David Garrison
Investor.Relations@hartehanks.com

Harte Hanks, Inc.
Consolidated Statements of Operations (Unaudited)

		Three months ended September 30,								Nine months ended September 30,
In thousands, except per share amounts		2025				2024				2025				2024
Revenue		$	39,520			$	47,630			$	119,712			$	138,113
Operating expenses
Labor			20,382				24,176				59,626				70,343
Production and distribution			11,724				14,421				38,181				41,850
Advertising, selling, general and administrative			5,149				5,260				16,531				17,051
Restructuring expenses			538				836				1,525				2,116
Depreciation and amortization expense			1,218				1,039				3,346				3,107
Total operating expenses			39,011				45,732				119,209				134,467
Operating income			509				1,898				503				3,646
Other expenses, net
Interest expense, net			84				57				198				107
Pension Plan termination charges			-				-				-				37,505
Other expenses, net			106				831				1,006				2,104
Total other expenses, net			190				888				1,204				39,716
Income (loss) before income taxes			319				1,010				(701	)			(36,070	)
Income tax expense (benefit)			2,605				868				2,312				(8,207	)
Net (loss) income			(2,286	)			142				(3,013	)			(27,863	)
(Loss) income per common share
Basic		$	(0.31	)		$	0.02			$	(0.41	)		$	(3.83	)
Diluted		$	(0.31	)		$	0.02			$	(0.41	)		$	(3.83	)
Weighted average shares used to compute (loss) income per share
Basic			7,415				7,324				7,386				7,273
Diluted			7,415				7,398				7,386				7,273
Comprehensive loss, net of tax:
Net (loss) income		$	(2,286	)		$	142			$	(3,013	)		$	(27,863	)
Adjustment to pension liability, net			73				102				282				29,626
Foreign currency translation adjustment			(281	)			(8	)			(172	)			(1,945	)
Total other comprehensive (loss) income, net of tax			(208	)			94				110				27,681
Comprehensive (loss) income		$	(2,494	)		$	236			$	(2,903	)		$	(182	)

Harte Hanks, Inc.
Condensed Consolidated Balance Sheets (Unaudited)

In thousands, except shares and per share amounts		September 30, 2025				December 31, 2024
ASSETS
Current assets
Cash and cash equivalents		$	6,510			$	9,934
Accounts receivable, net			30,206				31,648
Contract assets and unbilled accounts receivable			7,286				8,215
Prepaid expenses			2,023				1,511
Prepaid income taxes and income tax receivable			938				938
Other current assets			1,735				1,368
Total current assets			48,698				53,614
Net property, plant and equipment			7,902				8,956
Right-of-use assets			19,728				22,460
Other assets			16,379				16,752
Total assets		$	92,707			$	101,782
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued expenses		$	18,103			$	21,832
Accrued payroll and related expenses			3,827				3,210
Deferred revenue and customer advances			2,458				1,589
Customer postage and program deposits			773				1,625
Other current liabilities			4,313				3,145
Current portion of lease liabilities			3,520				3,736
Total current liabilities			32,994				35,137
Pension liabilities - Qualified plans			3,942				5,445
Pension liabilities - Nonqualified plan			16,463				17,103
Long-term lease liabilities, net of current portion			18,240				20,860
Other long-term liabilities			1,188				1,548
Total liabilities			72,827				80,093
Stockholders' equity
Common stock			12,221				12,221
Additional paid-in capital			109,621				124,194
Retained earnings			811,610				814,623
Less treasury stock			(900,085	)			(915,752	)
Accumulated other comprehensive loss			(13,487	)			(13,597	)
Total stockholders' equity			19,880				21,689
Total liabilities and stockholders' equity		$	92,707			$	101,782

Harte Hanks, Inc.
Reconciliations of Non-GAAP Financial Measures (Unaudited)

		Three months ended September 30,								Nine months ended September 30,
In thousands, except per share data		2025				2024				2025				2024
Net (loss) income		$	(2,286	)		$	142			$	(3,013	)		$	(27,863	)
Income tax expense (benefit)			2,605				868				2,312				(8,207	)
Other expenses, net			190				888				1,204				39,716
Depreciation and amortization expense			1,218				1,039				3,346				3,107
EBITDA		$	1,727			$	2,937			$	3,849			$	6,753
Stock-based compensation			150				368				321				1,654
Severance			-				-				-				8
Restructuring expense			538				836				1,525				2,116
Adjusted EBITDA		$	2,415			$	4,141			$	5,695			$	10,531
Operating income		$	509			$	1,898			$	503			$	3,646
Stock-based compensation			150				368				321				1,654
Severance			-				-				-				8
Restructuring expense			538				836				1,525				2,116
Adjusted operating income		$	1,197			$	3,102			$	2,349			$	7,424
Adjusted operating margin (a)			3.0	%			6.5	%			2.0	%			5.4	%

(a) Adjusted Operating Margin equals Adjusted Operating Income divided by Revenues.

Harte Hanks, Inc.
Statement of Operations by Segments (Unaudited)
In thousands

Three months ended September 30, 2025		Marketing Services				Customer Care				Fulfillment & Logistics Services				Restructuring Expense				Unallocated Corporate				Total
Revenue		$	8,826			$	11,553			$	19,141			$	-			$	-			$	39,520
Segment labor expense			4,524				7,722				5,360				-				2,776				20,382
Other segment operating expense			1,912				1,988				10,682				-				2,291				16,873
Restructuring expense			-				-				-				538				-				538
Contribution margin (loss)		$	2,390			$	1,843			$	3,099			$	(538	)		$	(5,067	)		$	1,727
Overhead allocation			633				747				754				-				(2,134	)			-
EBITDA		$	1,757			$	1,096			$	2,345			$	(538	)		$	(2,933	)		$	1,727
Depreciation and amortization			222				59				655				-				282				1,218
Operating income (loss)		$	1,535			$	1,037			$	1,690			$	(538	)		$	(3,215	)		$	509

Three months ended September 30, 2024		Marketing Services				Customer Care				Fulfillment & Logistics Services				Restructuring Expense				Unallocated Corporate				Total
Revenue		$	13,255			$	13,068			$	21,307			$	-			$	-			$	47,630
Segment labor expense			6,730				8,390				5,647				-				3,409				24,176
Other segment operating expense			2,746				1,605				13,545				-				1,785				19,681
Restructuring expense			-				-				-				836				-				836
Contribution margin (loss)		$	3,779			$	3,073			$	2,115			$	(836	)		$	(5,194	)		$	2,937
Overhead allocation			981				567				775				-				(2,323	)			-
EBITDA		$	2,798			$	2,506			$	1,340			$	(836	)		$	(2,871	)		$	2,937
Depreciation and amortization			365				44				266				-				364				1,039
Operating income (loss)		$	2,433			$	2,462			$	1,074			$	(836	)		$	(3,235	)		$	1,898

SOURCE: Harte Hanks, Inc.

View the original press release on ACCESS Newswire

FAQ

What were Harte Hanks Q3 2025 revenue and net income figures (HHS)?

Q3 2025 revenue was $39.5M and the company reported a $2.3M net loss (or $0.31 per diluted share).

How much cash and borrowing capacity does Harte Hanks (HHS) have after Q3 2025?

Harte Hanks had $6.5M cash, no outstanding debt, and up to $24M available on its credit line.

What change was made to Harte Hanks' credit facility in 2025 (HHS)?

The credit facility maturity was extended to June 30, 2028 and the facility includes an accordion to seek an additional $10M capacity.

What impact does the Samsung partnership have for Harte Hanks (HHS)?

Management cites the Samsung engagement at the Greenville facility as an early pipeline replenishment win expected to support sequential revenue improvement in Q4 and beyond.

Did Harte Hanks (HHS) report positive EBITDA for 2025 guidance?

The company continues to expect positive EBITDA for full-year 2025 supported by cost reductions and efficiencies.