TTEC Q2 2026 Earnings Call Summary

1Key Financial Results and Metrics

Revenue: $455 million, down 11.3% from $525 million in Q2 2025.

Adjusted EBITDA: $39 million (8.7% of revenue), down from $52 million (10.1%).

Operating Income: $26 million (5.7% of revenue), down from $37 million (7.2%).

Earnings Per Share (EPS): $0.03, compared to $0.22 in the prior year.

Free Cash Flow: $39 million, down from $86 million year-over-year.

Net Debt: Decreased by $36 million to $767 million.

Engage Segment Revenue: $351 million, down 12.1% year-over-year.

Digital Segment Revenue: $104 million, down 8.5% year-over-year.

2Strategic Updates and Business Highlights

TTEC is focusing on improving pipeline quality and sales execution, particularly in sectors like automotive, healthcare, retail, and travel.

The company is implementing automation and redesigning operating models to enhance service quality and cost efficiency.

TTEC Digital is shifting towards high-demand CX technology and services, with a strong pipeline and strategic partnerships.

The company is exploring strategic alternatives for TTEC Digital to maximize shareholder value while maintaining collaboration with TTEC Engage.

3Forward Guidance and Outlook

The full-year revenue guidance for the Engage segment has been revised to a decline of 4.1% to 8%.

The adjusted EBITDA margin for Engage is expected to be around 10.1%, reflecting a slight improvement over 2025.

TTEC Digital is on track to meet its original revenue and profitability targets for the year.

The backlog for Engage is $1.5 billion, representing 98% of the updated revenue guidance.

4Bad News, Challenges, or Points of Concern

The company faced challenges in Q2 due to underperformance from specific clients, particularly in the public sector, impacting revenue and margins.

The higher normalized tax rate (82.8%) negatively affected EPS by $0.08.

There are elongated sales cycles and smaller deal sizes as clients are cautious about investments, leading to pressure on revenue growth.

The Engage segment is rationalizing relationships with underperforming clients, which could have short-term impacts on revenue.

5Notable Q&A Insights

Management discussed the process of addressing low-margin clients, indicating a collaborative approach to improve profitability.

The decision to explore strategic alternatives for TTEC Digital was driven by strong performance and market conditions, aiming to enhance shareholder value.

Concerns were raised about specific client delays in the Engage segment, primarily linked to a major public sector client facing technology issues.

Management expressed confidence in the pipeline and backlog, anticipating growth in the second half of the year despite current challenges. Overall, TTEC's Q2 2026 results reflect a challenging environment with declining revenues and profitability metrics, but the company is actively pursuing strategic initiatives to stabilize and improve its operations moving forward.