- Earnings call transcript Q3 2022

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Operator

Welcome to TTEC Third Quarter 2022 Earnings Conference Call. [Operator Instructions] This call is being recorded at the request of TTEC. I would now like to turn the call over to Paul Miller, TTEC's Senior Vice President, Treasurer and Investor Relations Officer. Thank you, sir.

You may begin.

Paul Miller

you us thank and morning, for today. joining Good to third ended quarter is XX, hosting results its call this period TTEC financial discuss for XXXX. September the Chairman of Participating Chief and and Shelly Officer Financial Ken President call Executive on TTEC; Tuchman, Chief TTEC today's Officer of Executive Dustin TTEC; of Officer Swanback, Semach, of Chief are and Engage TTEC. press results. Yesterday, financial its TTEC release issued announcing a

encourage financial you Form that call read document, discussed for performance, will we about information XX-Q. this quarter also While third within our to on our XXXX reflect complete report items quarterly

statements remind Before and that operating we begin, which to are I revise want developments information forward-looking of note outlook, opinions to this that business these our may discussed of to include today's date result Please as this our obligation and statements based and related the that you call we no on beliefs on current goals occur. new call, financial forward-looking reflect as a undertake of performance, matters management's assumptions.

to are today. results actual factors other could that from statements uncertainties and various our Forward-looking differ expected and cause materially those described to risks, subject

detailed risk review XXXX as this under the Investor conference factors, turn call report available our For of be our on on XX-K a Relations subsequent website now amended the on A please Form quarterly over our replay will of description annual by section. reports more XX-Q. our to Form Ken. call I will

Ken Tuchman

joining financial for our execution overall solid you morning, results Good with everyone, quarter. third and thank us today. pleased for I'm and the our

range operational global our base by analytics, technology driven and diverse was capabilities. of performance strategy, clients full and our CX and of Our broad

$XXX.X Bookings million, And a third year an million. currency XX% a was million, period prior adjusted EBITDA quarter increase was on increase prior year financial few of share period. X% me the of were $XX.X Revenue $XXX over highlights. over the constant an Let basis.

for demand services reflect continued this bookings our strong solutions. and CX Our quarter technology

like dynamic facing our the businesses clients this in highly most environment. across are However, globe, macroeconomic uncertainties

the sectors that are is verticals technology-based government, impact serve In automotive As health is seeing and across softness. we there companies, continued expected, hypergrowth the like pockets, we're more other like banking, care, ongoing resilient varied. strength. In

companies these expect them, for as Happy customers to and agile more, the the clients trends focusing remain to each to active are on to promoters next critical. Satisfied the customers We costly less and customer with experience marketplace. economy, our their are hypercompetitive we'll customers to easier brands of year spend their dynamics continue favorite and working into evolving closely is retain. and serve, in adapt In are help We're a any market. needs. responsive new in attract

overall the bottom that the capabilities to and total Our deliver portfolio to of has CX cost experiences CX the satisfaction current are platforms always highest better customer line. are delivered and modernize clients into optimize personalized, seamless to leaning lowest serve. environment, In customer at solutions for convenient their our best-in-class their

customers companies enhanced center modern technology enable landscape migrate several fronts, strategic of on solutions comprehensive and simple clients we're base We To CX our to and with must cloud. seamless geographic offering. for our to nearshore at Digital, strategic offshore of locations technology CX analytics and progress that technology new Through employees. ecosystem strategy. the portfolio and and continues including deeper growth size across to of The analytics and automation with businesses, Engage CX collaboration verticals, delivery accelerate technology in embedded of continue our diversification with enable I'm the and our pleased expansion predictive, TTEC experiences, contact Digital these the core automation experiences entire and integrating And to with innovation partners with with our new evolve. both CX for digital every frontline are

life, TTEC unlock TTEC, hearts technology us strategic the her partner a of like teams globe when leader and all positioned the CEO As will. Digital build they to we're senior on-premise a cultural and month. our potential. with companies team We've role six herself with will Dave differentiated and of I'm minds months, TTEC has engineers the of a Shelly of Shelly aspects platform Digital immersed experienced a of to A to and adviser built addition Avanade is as longer and companies the on IBM, the is It's and and a Dave of thrilled has end migration President running. at the no Digital time migrate a effortlessly. Seybold our if also accelerate they of of leader of business, marquee enterprises promote has results-oriented growth accomplished partners. strong as our to captured and decades experience, and at I'm platforms at accelerating to software help in question question CX of it to our She portfolio recently of simply Atos, connected cloud global Engage. implement its on pure-play welcome last profitability our ground is our company is reach and well design, pleased with strategy when and executive our of her. is to most Wherever need in confident are help hit technologies a end their TTEC in their business across to ability clients journey, To imperative. of Dave many a a the business Dave's to full scale this the cloud. an digital capitalize as Swanback fit. In results-oriented clients CX CEO

our our to that, Shelly. than two hand our will these company's focus With more leaders about team, and it set I platform I'm on With direction over ever dynamic M&A and and on to side, engagements. I'll strategic the continue my differentiated innovation, client energized future.

Shelly Swanback

Thank morning, good and everyone. you, Ken,

execution $XXX and over logos Our million business. many environment, including across we XX quarter, solid. bookings new this In initiatives on dynamic multisegment quarter We in six made deals. in this delivered was macro the the progress signed

Let on updates a logos mix of Bookings embedded wins. few quarter good our start a new business. Engage and with base this included me

For signed example, we advisory a to outsourcing. financial Fortune is that new XXX firm

largest our offshore I'm global terms services. our pleased scale execution. report nearshore expanded countries. that that partner. opened more we accelerating locations. in more And even health meet to newest platform with that on new regulated geodiversity Many We're of cost-effective projections we're serve for of new be demand operations our our provide work to geographies. quarter, care today, I nearshore continue our our performance clients client from also And nearshore Last industries We exceeding we multilingual mentioned positioned delivery operate footprint seeking and insurance as we is clients and to and expand Colombia, payers and offshore expansion done XX with programs. hundreds our to managing their we our require our work-from-home and be Today, complex options go-to three clients location, well global onshore, in and open to expertise

exceptional license in with delivery as a programs reputation these leader enables to results. Our complicated manage us

dramatic satisfaction. implementing strong are customer improvements piloting are made plus our we in clients experiencing associate for progress solutions quarter, more Across clients. blended our productivity voice industries, solutions, and and digital This more

including team are welcome and providers, And Koskovich of at Chuck Our CX Prior Operating up expansion leading Chuck nonvoice It's to to engagement Chuck oversaw TTEC, to driving on growth back as the this wins year-over-year. Officer satisfaction great and geographic XX% have employee across TELUS quarter, Engage. back the Chief globe. client returning we frontline global International.

the Now third side to on the let's Digital highlights move from quarter of business.

gained Amazon Microsoft public make health our professional We widely services driven build, in practice. by quarter look technology a new with areas And cross-platform we additional services with in engagement all sector our care Cisco with Notable continues and quarter agency migration with notably, multiple health across of system. our managed come. the deals, strength between in momentum to offerings from partners. several spanning this growth care distributed progress a to and experienced Genesys. our work interactions this opportunities some seamless months forward with including analytics. We portfolio, particular to the and will growth a with and large deal across our momentum other continue that lastly, physicians with high-profile digital exciting a CX enable announcing came our patients And Connect, cross-sell large practice partners XX% to our CRM, And analytics cloud practice from areas. won we federal automation multiyear contract most including First,

are As are I a there top few speak that of mind. across clients topics of verticals,

recognizes client changed environment the talent that every forever. has First,

at hire, us inspire dynamics expertise to our new and of retain train, coming course, and for to ability are Our clients frontline the scale. managing reliably in team labor our global

implement topic is advancing near-term the initiatives benefits while deliver hot the long-term transformation. CX Another company's to need that CX

We're say, go-to-market, As leveraging capabilities I model progress advancing partnerships. steady manage like businesses our solutions powerful. to and our strategic the footprint, enough making matter in our to build little expanding done. This material our so our Engage is are where that our strengthening Digital get a projects but enough operate to is accelerating digital geographic design, and and selective

cost on responsive to our optimizing and structure execution, we agile what very under the control. we our and dynamic As We're near-term our environment, navigate will streamlining remain focused conditions. calibrating is investments, market

very of discuss Before commitment Dustin by amazing the a to the him XX,XXX globe. I'd now of best I I I I'll to across welcome our inspired to our teammates. hand clients TTEC to to be look every Dave and it personally trusted the and to Seybold, our off hand to working it for employees one with colleague. continue Dustin, financials. And passion of like forward unlock off

Dustin Semach

and morning, Shelly, you, Thank good everyone.

impacting financial of continue we we pleased quarter in clients businesses. landscape performance that our navigate third As as mentioned, economic is are ever-changing some our their the with to

performance. bookings quarter third to Moving

the period. Our XXXX compared in increased third year $XXX prior $XXX quarter million to million XX% bookings to

our digital across Amazon sales, Cisco solutions. offerings, Connect reflecting strong year-over-year excluding CX and increased Microsoft XX% Our Dynamics, product our services technology demand bookings, including Genesys,

sector, better macro Engage care which demand segment, and in was verticals, acquisition customer all health be our Now services, and of public across geographic with footprint and cyclicality. strong services financial to our care mix against insulated strength tend particular in our industry

results share is to release. full GAAP logos, outlook as will included discussion bookings I remaining million third remarks. backlog bookings and as XX basis, quarter pipeline while to in earnings reconciliation in in our per a new on adjusted In of quarter attached revenue included press reference address operating Our well deals. income our representing non-GAAP to on our six results, non-GAAP and the earnings on the EBITDA, a is third multi-segment my XXXX basis. GAAP A $XX my tables

million, XX.X% We term operating million $XX.X a the in the are the or strengthening our $X.X compared benefited as or quarter $XX.X year. the income the of was within Engage Organic XXXX, Operating million exchange the a translation like-for-like was positive increase owned of or revenue the our $XX.X prior revenue was or currency segment. third U.S. $X.XX XX.X% basis in constant in million them million to primarily revenue And XX.X% headwind of impact growth to the consolidated X.X% relatively to $X.XX to basis, describe treating the on lastly, $XXX.X like-for-like dollar third quarter in an million Adjusted excluding and The revenue a million periods. impact was of growth flat income prior foreign was we compared basis. using by on a year. X.X% continued to and of the basis was acquisitions $XX.X in but of pandemic-related revenue prior of volumes. On EPS compared year. if excluding in prior $XX.X X.X% EBITDA

XX% in increased Our benefited clients. our Digital and the benefited from a to Faneuil from in product noncore from existing and systems hospitality, highlights XXX% volumes XX% by revenue bookings more integration include acquired acquisition, or from our of work, which a in quarter new sales. public increase a third we offset revenue and our composition, revenue and Similar higher travel acquisition, recurring and EMEA. increase in a sector primarily to normalized increase Faneuil levels Engage automotive attributable April early XX% lower increase cloud Other

incremental of decrease in Faneuil to a prior the the Turning profit. and primarily function talent and associated now year-over-year segment our growth-oriented The reduction will I integration-related to costs with period, volumes cover year pandemic-related our operating compared investments higher-margin acquisition third XXXX quarter the results. is acquisitions.

our in tech of Our Digital revenue $XXX.X services Similar cloud product $XXX.X by segment partner platforms, across the Digital reflect offset compared year increased Tier from in our to systems million integration period. to was X and third CX composition, lower our bookings revenue the results million quarter sales. prior XXXX our

Digital Excluding these sales, X%. product grew noncore revenue

progress Cisco in we X% of the in We professional are fourth to year-over-year third XXXX. the growth back quarter growth our the our first made quarter the over practice since the quarter pleased with practice services prior returning of year,

technology to CX as third to continues value of continue connectors CX business product growth and leading we our period delivering quarter to that Our IP with in year well, enhance functionality our improve prior the and perform tools execute release new proprietary XX% customers' time and the road maps against technologies.

Digital's and represented XX% cloud total managed services revenue of recurring Our revenue.

XX.X% in total or revenue. rate of higher upgrade integration compared margin for income systems supporting expansion sales leadership due future in to and represented $XX.X improvement mix, offset of and and million another prior in of $XX.X marketing engagements, incremental revenue was revenue high The diverse period. to a have partially million XX% Operating developments. investments or XX.X% is and engineering Our year product revenue services, by the attachment margin CX which talent, technology

over XXXX third our revenue $XXX.X the excluding growth to a like-for-like on year, segment quarter X.X% Engage prior basis, X.X% of the Our impact increased volumes. pandemic-related million

While acquisition particular volumes delivered across we travel the automotive contributor a to quarter, growth was with industries. in Faneuil sectors meaningful strength industry sector, primary public in and the asset

XX%. retention embedded by strong demonstrated continues performance rate its as Our of last Engage's XX-month base revenue

X.X% or compared $XX.X revenue to income Excluding the XXX%. X.X% pandemic-related prior Operating million retention was $XX.X period. million year or of volumes, in was Engage's revenue

flow was The were generation. $XX.X capital of decrease million driven in prior XXXX positive the year Cash the outlook. and to partially and margin share renovations. $XXX.X delivery for working investments credit the prior will cash and in our to due upgrades $XXX or in facility-related acquisition-related centers. in related liquidity, operating million continued IT quarter of impacts flow vast distributions, from operations $XXX.X At was offset investment quarter - anticipate our $X.X timing metrics total to million million million debt our cash million by under our or debt, decline some the diversify anticipate team long year. of the increased will Capital by Our in comments which year. of on The our primarily $XX.X our I to $XX.X $XXX.X billion a our planned now compared end, expenditures represented the ramps, further over cash in which Engage We third to reflects capital results the prior quarter compared increase X% program by desktop year-over-year services margins a X.X% well as of was and highlighted my we deployment is as that Net profit with client the company strategic flow, of offshore third term. and capital. over benefit million majority before period discussing million the function primarily XXXX borrowings facility. multiple build-out member, $XX.X revenue investments, the of

XX.X% in XXXX select in of Our In zone quarter declared The prior normalized international dividend. Philippines, to increase to our dividend. X% semiannual represented October third the paid semiannual a XXXX year. We benefits. the as related shareholders the PEZA, April is income September, increase reduction change next share, dividend committed remain through to the tax of dividend the which dividend and rate primarily in versus per XXXX. XX, a related a was the and This October tax mix capital over 'XX economic in Board special distributions October XX.X% of XX, over XX.X% to regulation on $X.XX of jurisdictional shareholders to within was record XXXX, tax of the a

outlook. our to Turning

We few guidance year quarter's billion year's quarter the of our uncertainty full make revenue economy. backlog continues guidance. reflect third $X.X to a the I from additional XX% Our last or the XXXX a to update midpoint the comments. of want unchanged surrounding remains with of global and exited

increase is the year. of current $X XX% over prior pipeline an billion, Our

optimizing quickly macro so our the We and implemented adjust to environment. cost-containment initiatives quarter ever-changing structure continued can cost we this have

but G&A optimizing earlier rationalizing Our through not in streamlining overhead reducing to, and are XXXX made quarter the the functions while consolidation, expectations year. XXXX ongoing our outlook our third to estate, our discretionary spend, obtain of cost-containment and initiatives for noncore segment consolidating investments release year full growth-related real supply limited our vendor earnings include, the performance, Please chain our reference maintaining business our press commentary section fourth in to level. quarter

metrics value XXXX remain comments are applicable. in continuous earnings to through year our during profitable We turn midpoint earnings fourth full and look to your call In and were full excellence I second value the Ken. interest outlook guidance still long-term our sharing when back the shareholder now that forward TTEC committed growth. results. quarter announce we XXXX and maximizing call addition, closing, over technology year the operational In will quarter XXXX provided innovation, to we

Ken Tuchman

Thanks, Dustin.

we Before in I'd to XX and is recognize service the from Paolillo, company various roles. retiring years thank who like of dedicated Regina executive close, after

have During resource me. shareholders people was to at trusted and our her partner our growth. position for a global a of us CX for she valued next phase our and our and adviser helped TTEC, champion a platform clients, us Regina's tenure to tireless the build efforts to

and our shareholders deliver Working come. clients our of many and want customers that lasting create incredibly confident XX,XXX to team we're to positioned thank for day. As ambassadors for their we talented CX differentiation years our profitable well the every celebrate to who clients I'm our results growth, I together, and our XXth global anniversary, build value drive for

wishes and at health all much of on With the best holiday approaching, happiness. TTEC, season for us of behalf

continue be the look Paul. We your you support with for to forward the exciting over turn call sharing new to year. grateful more to and now in I'll progress

Paul Miller

Instructions] open Ken. you may Operator, [Operator Thanks, the line.

Operator

the Mike Instructions] [Operator Markets. we of question this Capital time, first line coming had Latimore of Northland from At the

open. is line now Your

You may raise your question.

Mike Latimore

Congrats good right. on solid a All guys. Good Thanks morning. here. results

touching was What's maybe the little about that would of XX% But growth. of that? despite a environment? a I growth. that? is have in kind bit see slowing little thought sustainable And macro Just bookings up environment. you'd sort that that guess a growth on talk bookings this the bookings I you I driving maybe in can mean, bit of how

Ken Tuchman

as so sector in I have a Look, to federal that we incredible what's vertical, that morning. in automotive can tell I future. quite we time continued in Good any going love see on a through and been globe unrealistic form the take get cyclical that continued Street in marketplace continued have as What would public And the health we our recession strength and the not that we're very our verticals. we've our deliberately of just across been to to telling economy. global some verticals of you the of vertical. would is feel as think place strength say our bit a with level care to are and the following: far intentional, vertical, The accuracy we But advantage for take business based it's we diversified other seeing as this as you I strength

that's think I that, And so helping.

I comments, that my But that and said not are said, strong. his Dustin the in I we like paying in some in as think other space as seeing verticals tech I said off. are it's that, think comments

where for that have quarter. looking bookings therefore, in reputation. really good now, fourth third trends closed our we amping strong the the we very feel so in are we very And focus are similar. a we And quarter And right the areas these up about

this going very want it's if So difficult see you Shelly, corner like XXXX. to add for around to of the gives look I that. to clarity. said, it's you in time hopefully, me anything don't that that to at know, some what But

Shelly Swanback

just might of I Well, sort reiterate.

that's QX, diverse and I our in we think mix of the in bookings pipeline. was what see

to mix and number nearshore We so actually have the looking of at are advantage onshore outsourcing, a sector locations. taking new of our and BFSI the in that of clients offshore

into but with And we're - for we've embedded quarter, So quarter said, Ken on being base, that. pleased focus focus there we and also this as just a a had next going new big big logos. our

Mike Latimore

great main the little there? talk Great. a And hear of bit factors the growing. are to what's about you then the just And practices kind what Cisco change behind that? Can

Ken Tuchman

Cisco globe, Yes. a cloud-based I which the about that they practice I X.X going for and offering. taking that at proven announced decision the believe X.X has across the feature time, offering but One us, can it about the said, not the chilled what's premise-based ago maybe were that only following. to years it product argue set. proven think mean, client and made to That move and premature, real product scale was could has for has I place that has a web-based out everybody. and a years from they now the immature that bit base a a that they the put product announcement maturity substantial ago, that is

And comfortable Cisco - we're is that's begin now the is solution there what premise-based significant feeling would migration. on to that their base embedded now what we call seeing a the so is a that

creates very trend going that, hopeful are that continue. we're pleased is lot think so with and We that. future a to that And opportunity this of

a As the said of not simply script, CEOs CIOs in It's move and when. going I are matter cloud. my of just a if matter to it's to

good maybe and consequently, is a And been And we're has Cisco we strong that than great activity - that's pipeline. took bad migration hoped. would but taking the very news is, so place. partner. news, It of have seeing very, maybe benefiting the definitely That's we're off now that very that's good longer not

Dustin Semach

comment there we're the around of services the of one part into point just referencing, the is And around growth Mike, clarification follow professional business. is to that

new give to update recurring managed we're practice take because lot point, going catch of As on you of the where time positive of which to a we're expect platform, it's their for portion a to of is can that, implementation you very services But imagine, right, XXXX. doing work it's Ken's kind again, - behind we to but the headed. sign of in up on a would indicator kind leading so

Mike Latimore

Thank you.

Operator

now the line We Instructions] of the next have of [Operator George from question Sutton Craig-Hallum.

Your line open. now is

question. your raise may You

George Sutton

last had of went costs and Thank back understanding initial cut customers some Ken, through you demand, in you part who then this pulled but with it examples of quarter, customer you. short increased the in happiness. the concerns back term, that is can fascinating came will impact your

think realize where early that of coming do the look where So that make closer keep continuum place? Or they we you to out we you QX? we are of in people as investments to these are Are those phase to point they in in need starting cutbacks?

Ken Tuchman

to say say you the their the last following. I'm of the although and a it's is us et add their trigger. chain, keen as I inflation, that not think et his watching that to mean that by the and or which I conservativeness. every cetera. but as the on very are business, consumers, future they hand with seeing think XX Good increasing And is trends has and cetera, would very What with only that supply her some as a hand is team, what CEO are and That safe to eye asking I more morning, about hours thing because business I requirements positive to George. clients good our with We're recently said, their us, the

so have on has been not incredibly the expand with that become we allowing them hard demonstrate working to Shelly have to so also control work were agile we dramatically - our consequently, but clients the and her to us that more already able And we quickly than we to can only along closely ability be to cost. with teammates

clients place fact So cleared that's some the think or way just basis. agile or is almost that the took headline came CPI marketplace And And I fog the of you that that our totally from ago navigating that every minutes this and out than cetera. what that I not number of they're the the think et new there's week-by-week there my due ever. more a think it's to - XX I kind midterms clients saying - whether think whatever, week, on I there to to are

as And I into a that much have do the year, we're over the think and quarter, I a go clearer think that they us will clearer give picture down. think speak. forecast much new clients that we I so once than there, last settle they'll to

So know to think of agree question would uncertainty precision the would in typically asking now. I I not... answering lot just not out a with there's whether our global keep right I'm that that your of sales But level that you answer. I like I there the or leaders, economy

George Sutton

to this have curious, just it clarify I be I'm because possible Dustin would think is important.

Is size think hyper little a part verticals because bit a that that's You answer in mentioned few to way those question? really I the and bunch growth weak. a of tech verticals the there to strong very are that are of just up

Dustin Semach

terms to or of of the impact size up terms in them size vertical? the of relative In the up size them

George Sutton

versus tech, think. hyper-growth they're would up Well, travel services, auto, I add much I bigger, government, if financial care, health

Dustin Semach

No.

only Hyper a go there. you back right the there's two, the of to in our grow as XX% it's growth. calling To range. itself those impacts He's couple for that So the give quarter, roughly growing about in X% to $XXX expecting right, size, size example, as is the full roughly in industries. idea an growth things but hyper telco well talked out that prior if were prior all growing, cuts right? those in you about by So quarter, on million we across CME, This vertical of but year - as the an it's we still

look that you makes So sort cuts other we're the it across George, telco I entire hyper if areas through But as bit the that. seeing piece then a business, think little at growth well harder to that as is the which weakness. still some

George Sutton

Yes. Thanks guys. All right.

Dustin Semach

helpful? that Is

George Sutton

Yes, absolutely.

Operator

We the of of line now Maggie coming Blair. William question Nolan the next have from

open. Your line is now

may raise question. You your

Jesse Fink

to question. congrats then Jesse Maggie. is This question on quarter, have last morning. a and verticals for and everyone follow-up roles. Congrats I on on Good the the one new on

clear in So smaller you are different the behaviors in you're what of you're some seeing? the seeing terms you're were seeing these but you for weakness, about contracts? guys can preference verticals? you behaviors talk seeing seeing more versus What Are of cancellations? you about resiliency Are

Ken Tuchman

I'll seeing want as some new to And start, and relates say a In would would I we move whatever is, no, it reason. Shelly people very particular and acquiring to quickly let they it. say is not providers, for mixed to I it's What are changing net bag. business, what add are cancellations. cases,

that's we don't in actually seeing good know, say et right because a So that Shelly, for were not We're working other It's that both to do that past plans, I with that would I see large thing very say are maybe, final deal. would and Dustin, contract cetera. an the to there times and were question us. you... incremental deal this, cases, transformation a the getting not you of where more it's on they're feet. and have opinion commit in now. did sizes smaller. clients stepping that history being a evident our time In they're long-term they more taking on are where kind for good I

Shelly Swanback

of kind running. got would Everybody's wanting it the say, be to earlier. finger what Ken I I trigger think to agile like just back goes on said their

ask come types us strength being to if I things our us of able lot our actually And plays of actually and had to very think that So in we where we've up work. of different there's to staff can quickly. a situations terms do customers

and needs. ready And to to so their we'll agile remain respond

not client outsourced are services to our had have considered using we're really into several I and clients earlier, think there base. said as who I excited bring - onboard before, we

And that have to of So we exciting. parts that's I scale just business. think having others some different are their

And so we're there them. right with

Ken Tuchman

type wake captives I mean, we suggested the and them fingers partner up Engage causes recession coffee that that moving - there's captives. we benefit shall on smell have in I partner. there side being of thing believe and a a starting crossed in know that the with the the we and is that believe say, $XXX the just that is that past to spent to, actually over think to one business mode realize billion there internal a we more - to that We we business are good those well, a are

be that chosen very that's I cetera. - the so a significant with us could a in that of now never mentioned itself they've exclusively, et in that, positive And journey script before XXX. to And us. start a outsourced for one in Shelly net that has think Fortune company her

lemons believe could how point pair recession in their getting say, So shall internal captives to, being into more that, that turn in my we off itself by lemonade that these a you be operations. of we

of So think any I types don't thus that those of we're trends. seeing far,

seeing. are we I that volumes keep their obviously, for demand lower. everything to are is seeing why and more any by with can more hope really up to we volumes affected clients, continue what their And to we're make that... that's certain reduced Now are adding try that being doing clients to we're

Jesse Fink

I the appreciate Yes, context. one offshore on thorough had the follow-up business. We good response. that's

you So offshore? inbound maybe strong through Colombia. called you it noticing the Just for and in declined out performance well. revenue offshore workstations increased filing, looking as Are looked actually guys like year-over-year

there going you talk and can what's your on ahead? about expectations So

Shelly Swanback

I think would - what say. here's I I Yes. mean,

all, because of we locations. just First of out newest one Colombia, simply that's called our

in scale India offshore nearshore locations and like the and to Philippines, So business we our other Mexico, like. continue

number geographic addition their I to some today to serving in help our instead diversify onshore. - think - right? a going operations, onshore, it's we're of to Some to our we quarter onshore it's offshore had bookings clients actually not of footprint, were clients this actually actually of our add take that that

continue we're to to So more add think locations. going I

and going quarters. As more that plans expand some keep we Latin I in have America, we're to said, you the coming some here over posted other we'll

Dustin Semach

to we've up, this longer opening the it's is And scale. ramp that now of as material follow-on in recognize and to to associated way have also geographies QX, it bookings in Yes. we more the lot already that expect the slightly impacted a due largely our we're this shift quarter new Colombia of the have that. right a to to we those there's trend as somewhat other year fully begin related geographies bookings XXXX the acquisition Philippines, up just mix. to A in was mix that schedule work. because which over is keep the that bookings in ramping based already in larger well that mind, locations, Faneuil, right, with And the reverse We is. on a point the down that booked core, bringing the and to we And domestic relative

Jesse Fink

for Great. my questions. Thanks taking

Operator

America. now next line Bank Cassie of Chan from the have the We of of question

Your line is open. now

You your may question. raise

Cassie Chan

guys. Hi Good morning.

to XQ, but guys I'm guess the you of midpoint was And outlook I'm just trying XXXX just revenues the talking I here. understand, about unchanged. outperformed So in

and through some CME, that some there FX of? there hyper XQ. you And cases about? implies just are clients, Thanks. into us we Could weakness puts for baked that aware incremental Any or changes takes in So talked like in you Or guide? example, your the are other should be the expectations? the that growth specifically the walk that

Dustin Semach

Dustin. This question. Yes. take I'll Sure, is this Cassie.

So a we are we comments is, in QX during couple of as One themes QX. that experienced the mentioned, make. I'll continuing

is the If you to was CME go year it in weaker growth is bit million about in than full it stepped you level was a of to right? $XX That - first FX range. than specifically, guide, we now that think up kind million $XX about mid-XXs we and talked to little our beforehand, impact anticipated at the relative into When number the would prior the about on same a was say that I weaker. hyper the FX be their a just higher, of programs could life And of factor and kind quarter and year bit is think than own a uncertainty think next to really, QX between they're volumes guide, you else. really the a there which relative bit anything at revenue volatility reflects what just some QX, where When And lower. little little full in more about one when in that you cycle. quarter about be the quarter. that's could was

at in at this et those about booked, our cetera, the and kind point to we're kind trends continuing to bookings despite the themes, uncertainties due point this we're optimistic And fact guidance in that we so the maintain and the time. that of time, of continued

Cassie Chan

one Got then it. on just follow-up That's And the helpful. piece. revenue Digital

sales. was X% it noncore said ex product growth you year-over-year think the I

had Is difference XX% just just between was can us XX%. And us with you medium-term you So still plan that the said help longer-term those about help that figures. growth XX% here? for the growth to reconcile reconcile historically, target Digital the for organic or

Dustin Semach

Yes, absolutely.

in relative XX% business maintain continuing for we've our growth that overall challenge primarily the long-term in XX% roughly And XX% is had time, again, overall expectations. collectively. to the So at point which we've our P&L this tampering of pressure that within we're to is called out And growth. is business, business putting the that to Cisco

long-term that us growth growth that term, target this that in so of about a that's sale large the to returning is longer overall there, in And this range in progress prior in year the back roughly we million to the $XX third the quarter very about alone. Cisco tune growth quarter the impacting to required particular product terms for making is was hit practice in had rate. talk we quarter, why But this we're

Cisco, in I and Digital out well. of to whole, as And performing of which And say, update XXXX. we'll would other think you so we're make areas, areas about speaking, a the called continuing have strength, outside you broadly for better a we is progress, excluding business those when

Cassie Chan

and And say? quarter for it. to year, of would those into next you Digital persist headwinds probably next are beginning Got going

Dustin Semach

Yes. Yes.

we've And But leading business you largest areas practice, systems recurring the professional ramps once about Genesys while if implementation that's and go around quarter. back very business well our our back as our look, ramping in comment you have obviously, the as third excited think So doing. that about business, a very and to it a takes if two growth the we services fact we're these indicator for start that returned positive, to you the where that revenue, program. really

Cassie Chan

Got you. Thank it. helpful. That's

Operator

the the have now of next Cowen. We of coming line Bryan question Bergin from

Your now line open. is

You may question. raise your

Unidentified Analyst

FX underlying the dynamics notably cohort to appears Bryan. performance, understand On Hi, thanks. Can the I here in quarter. top play the on have [indiscernible] and effect, about client going five you This decelerated two through to expect at is forward? for an but what there's talk

Dustin Semach

I'll take that So question.

decline diversification some general, year-over-year impact right? Even of in QX there's board, is look, still don't about our where QX across one I in outside reflected this performance called customers top services talked would some say, volumes and the And around There being we're the between top COVID associated moderation So that in to million as there we past quarter, to be the customer. large those relative particularly, of to things the growth, any difference but business. I a an about the of in earlier relative think we $XX - notable we've customers in one some we've third customer quarter. with continue had out there's in overall being financial COVID-related down, may of come of as degree, talked to the our of volumes 'XX. 'XX about of

over moderation seeing that dynamics, They're across one volumes there. talked top primarily one of we're we're backdrop and we And that's the - weakness. some the that base customers we have clients a customer of board. the about about, heading very so but very where of positive felt XXX that into. that verticals of And with again, some There's in kind going the diverse said, today, into

Unidentified Analyst

senior on for the here? the And execution it. or stronger change of might growth so. year Got it's done And to How past TTEC Digital, strategy leadership needs what evolve? second in that be

Ken Tuchman

second you say you not I a mean change. second actually what I'm know It's sure change. when Yes, not

billion. myriad that's well the in to that Digital TTEC et has to cetera, of including $X planned, know, grow a recruiting top-caliber everything acquisitions. and business taken done can you of us CEO place all was And As excess a down

new would you types et we to I heights. This I in he is Dave to an have business And the do joining. with growing that all the experience his managing excited growing gentleman is the has businesses, will world couldn't it simply just and taking with these what of of his reputation that say So incredible and double-digit excellent market-facing more a in job cetera. faith experience in be that businesses

think people with and to this required now and a bright also while business cloud of the period going So very taking don't the the business have in needs good understanding an trying people keep in future. frankly, companies maximizing really that double tail And to technology on of address with most shortest are their is what's marketplace our the focus very trends therefore, we customers. business feel, that's the all profitability beginning continue we we imperative that possible - the the think to to place modern of customer the And a and about the business. that experience has long the

Dustin Semach

made that I'll comment growth ran to And is still analytics then another that we've practice on what's comment And integration we're referencing And about now that, important in some we this is that's we're earlier when the had is practice, again, kind And doing lot Like area. right, bright that's and that around the our acceleration really primary obviously the mind. the practice. that, there. there. quite seeing question that back we're to of And now as this call time. only spots out acquisitions the comment obviously the dampening business, come result a Digital there's a our overall for right top point a and prior with again, already is other practice of again, of that of is demonstrating that Shelly Cisco strength

now a can kind further. Dave we're XXXX. for that And seeing so to growth there's And help obviously, number enact become board is coming of on that into of areas accelerants that going

Unidentified Analyst

you. Thank

Operator

the question from of We next Canaccord. Vafi Joseph the coming now of have line

open. line now Your is

your raise may question You

Joseph Vafi

for to know you're you current to be in Nice I environment broadly, the proposition clients competitors how is to everyone pricing? in run marketplace may congrats tweaked is higher-value Good And that not or How to in of congrats the and in I well-deserved that and perhaps new great for it just are question Ken. perceiving trying the a on my and a price. here service everyone. relative weakness demand you performance some low-cost getting capacities, the is Regina don't in My really if compete quarter. provide how value Ken, their Hi, the and know exploit maybe morning. it's retirement. provider. their

Ken Tuchman

not seeing Good first said client of any I we're any - morning. Well, having cancellations. all, before, as

day itself we're of should you value So out clients you price the delivered. we is serve not because our to demonstrate that very tell experiencing issues we is we're in our how What tell day and with that that economically in our And focused to total business. the I and any would just clients. total what cost

I ago, even they what to is more we've cost can't And have a you where was a just of they And the that than cost is hour were of measure might lowest shown ago, off sophisticated what per clients What that tell is per minute. would the so outcomes. you couple far them that was years increasingly now are or have way. on you few years becoming measure what focused the lowest what

growing. And overall keep are myriad clients why that our continues so analytics demonstrate serve. lowest to that to the And are our providing we embedded base a of it's with we cost consistently

clients to wage the would able wages. really very were the in what much talking increases a achieve we our resolution. hire has frontline quality. The we ultimately very to about first that faster to were employee by best-in-class pass that We the has call a higher is And can good back day rate, retention, better be So example so, higher-quality first at gets increasing that in to contact be doing frontline aggressively through. Street were that workers' to the demonstrated when we significant that how we a our creates and proficiency far What we that industry

first their underpaying is talk the as like their the cost on to longer as are that lower at the the first so side, of day, nowhere example, overall And everything better end good. times to drives not the provider serve. employee, an is that from near Engage And resolution the the contact ultimately it's resolution the ultimately, things quality hiring or associate contact

you say our And I'm constantly internal cases, providing us could of well they in us comparing against the that at happy So in how because as other priced, very of their captives. internal are with day, outperforming else some similar at consistently are performing to be they peers their the services. premium cases, say using that we're looking majority alone the captives, And clients the anyone end our sophisticated. we're provide are as let might to we're data, they currently that although that

other to be that that are And and our so with as our that the and various countries expanding well the question. very able it help opportunities done announcements hope but Colombia why has why of But multiple are countries is add rapidly continue team has many your in taken this and that's to I and near clients also opening and see well. in live all going of significantly saying is off her because different also will very the goes why goal to you to business very answers offshore other that without future more in So future. near Shelly

Joseph Vafi

Ken. color. good a appreciate Great, lot, it. Thanks Much that's

Operator

the Stanley. coming of Faucette have next Morgan from the of now question We James line

open. now line is Your

your question. raise may You

James Faucette

to customer of other because very needs base of you to or things I onshore. regulatory you Thank ask, much. Shelly, portion mentioned there your that that wanted is a - reasons keep

guess cetera, see revenue they et obviously, wouldn't try is they to that to A your operationally, I that tend possible lot how of them. their for times, portion those manage reduce potentially And we people what of own But - cetera, the that constraints, as wondering constraints move now? just et do be face to have? customers So cost. offshore, really, represent

to bit customer trying little color base. a of on get that just your So of part

Shelly Swanback

are more that of the It's as include said, And complex I the matter It we've - been tends to we James, their partner BFSI work. place to in - and the resources. in we managing the I we've partly the complex programs want we've some training be it's to - of you not what this it's just that they in like think I many think well, have we're health onshore work that the because industries with how where in can't, put them? Well, so we of become being able have vertical go-to we demonstrate and vertical, handle we're of sector They the a public mean, offshore. ramps able do And be in there's regulated right? our able if care of terms obviously seasonal like cases, on, vertical the perspective. in - to in work. work that work client work. then that lot Yes. and a move particular, to isn't licensed these the of of from concentration agile with And very to that

this our think $XXX of to future. I - continue and million the be so part book - the our part And that we And additional strong of a part there. will actually - of included work bookings quarter

Dustin Semach

the numbers up This some of it. on follow to of just James, is then, side speaking. And Dustin

roughly of are of on XX% a work on perspective is licensed. So onshore. and roughly our BFSI, XX% those the health work care, from And the to be the is licensed, part acquired

James Faucette

can of move is margins. we at revenue that. times, a Appreciate And least, better it. in Got it. offshore, Got the revenue per the head to lower but then see lot - result or be

P&L evaluating on about investments? the And then So how impact forward? going thinking that that impacts how and should we way be you're

Dustin Semach

Absolutely.

don't is, We our and growing with on transitioning onshore wallet we through clients, from a couple I offshore. So focus of focus say. doing that expanding to work of share would again, things One on our overall offshore.

going a for give far, demand we're James, lower rate, have haven't and obviously we've there's very the which offshore going And to you're into where motion higher level payback to site of doing of relative our work. the the cost in that or business where is actually geos. period between where anchor you going is an margin. maintaining quick the there's been. best look those it this of and degree it is And investments just there's we've but a our about if leadership point, a in And continue do three around so And can. programs or And the new much kind that that's the we're now at new lot our expanding. taking And right, client. else, domestic opened today to to landing for And client transition base, right And across opened we you're obviously, we and to a then so them reasons staying that dollar board gross to moat both somewhere of at mentioned do a XX-point and a outlined, the taking the four are And margin we offshore it far, - we're the site, some in so embedded up area. seen with now by those an the margin which tend dollar the and of we then largely it, at at that, And very into as at site of and protected high are idea, some investments domestic we right, bringing countries, year. past Colombia, differential you that. we we've worlds,

we've expansion anchors far, that been the opportunities, help? so I have gone And or shift. mix Does would say, what with not a transition in that

James Faucette

That does much. you help. so Thank

Operator

Vincent from of have the coming now Research. Barrington of line the We Colicchio next question

open. is line now Your

You may raise your question.

Vincent Colicchio

your a in if target? what don't mix of today curious of is of the you exact Ken, magnitude have And offshore number? you Yes, order if portion the delivery sort have

Ken Tuchman

in in It's and are with we our as Asian get especially XX% that seeing the it focus to languages, roughly the in our to success, having near adding definitely relatively is XX%, target area. this area especially more We're we around start future.

are. is currently one domestic just of issues that mean, I So that's we keeps where growing. the business our

that offshore so amplifies percentage. the And

good problem one to on it's hand, have. So a

XX%. to success. I other that come. in that On to I to our And and job that you lot from desire XX% that our see a a hand, the of get organization having doing would percentage think And is to think up sales start quarters the great tell I is move you'll

Vincent Colicchio

more you. positive acquisition question the become direction? seeing the Are more one seeing And you on move you inflation in And to macro are valuations thank tied potential your side. attractive? wage Yes,

Ken Tuchman

is a - that takes the the peak get. been we're the seller that to not down. quarter we they're that estate, reductions and multiple middle going this end valuation would of price I first say while like would that This fifth until But estimate valuations it's real market the definitely of to acquisition movie it the come times. realize more not that potential will recession. the and is see earliest, that year. likely, all, best the and of I've case to the first it's going that is think And my I the of to of

it. into And so that will clearly play

the and have deals. on That thing that up in finance don't the going down. is other are but interesting driving because markets impact will to The change eventually on also an time near will clear very in right have this that out obviously to That's locked valuations now. access leverage be point the really equity at private players future,

had You another question...?

Vincent Colicchio

Yes, wage inflation.

Ken Tuchman

inflation. wage Employee

I the I question would is the I news, do too and that Do see it. we actually it's going Yes. that that, them? in ones itself And I call. we've as most to more anticipating. say been more companies recently impact in that in to their it of about early wages? think no There's We - to - think think expect more announce reductions force

that the that so the to it's I in of global economy best of for that think have But of speak, after down. see think reasons coming when right I to feeling year. And - is wages would guess, and valuations sooner we set probably my higher say I to climate going that we is guess way. even the than start will will And - that's that's the to benefits, first lots so, that I point I that some for see in. we'll demand real see My less we sellers saying that,

when it's effect et cetera. an their on some will going workforce, And provide to interest are future. adding more us think to the impacts companies benefits rate have in I the that obviously to

is are I roll wage to moved pays that all we've to that out CEO seen unknown think on big It's to going figure increases to trying base that hard the steep lines. imagine we've every one, is though, the now the front back.

easier money, to to to opportunities I bit think it's a move more them because for else simply going to be cetera. keep have longer to less hire going somewhere people, other easier et they're

So hopefully, that's helpful.

Vincent Colicchio

Thank Yes. you.

Operator

Our Sidoti. the coming of line of last Anja Soderstrom from question

now Your line is open.

You may raise your question.

Anja Soderstrom

I question. had my taking for you thank Hi, a just follow-up.

those how over? are? And that providers. you of You some talk changed mentioned about them Can did you customers who earlier win your

Shelly Swanback

I Well, client think names. specific we share won't

Ken Tuchman

competitor name. Nor

Shelly Swanback

names. bit of - give you competitor just little would Nor a color. let Yes. me I

vertical. in momentum travel mentioned - obviously, a where where in lowest taking And of spot clients on based being Ken not - being being as quite hospitality, into and value Some highest that area continued QX definitely - we're the on performance. are going BFSI on I also price, on an we but - And for and our think bright based was the I that's those our based QX, us based share also said, sophisticated. were examples and we're that the here in

very clients. solution, for the value, So we're on providing cost-effective have are but we our overall focused we a certainly value

and it ramp of with terms So work that to handle our to in it I being said work. as And clients complex our ability around tends earlier, in performance, about ability licensed quickly. to people to be about tends able our to be certainly arena, the

Ken Tuchman

CX to so of is them. cetera, have a that competitors, you of consistently I I what some address Digital are other Dave on from GSIs it, add across focused as you can side, of myriad are also will that multiple et calls, to future let's, to Where on this. - think on capabilities be able we though, want provide the platform, them call as do None speak. defections None are are. seeing we And the color.

And GSI, a take been and CX so We take the plug as significant global transform not basis, and far them and cetera. need consequently, beneficiary. into need it we not and pulling CX with we, GSIs, speed the years, that where over. problem for when the are reputation large that project, years, they they that simply multiple saying, integrator, they're by the a this that saying, you make they it's consistent business we're our and actually the it's they to to this - there's going. are become where The clients it, because step coming last the initially so are that It's to we're so in topic for as they're to hyperscalers, on months, on just positioned the the getting GSIs unhappy, where deals taking on other need these targeting embedded would are run consequently, to where et well impacting we is a area And GSIs. over over systems demonstrating winning I you large years, in to from you we way, it, capability is how and us and not gave fix these a because that client implementation point the this fairly the we was

and to And we've been so those continue see opportunities. that we for doing years,

Anja Soderstrom

Thank you.

Ken Tuchman

you. Thank

Operator

the Thank today. back questions. will to the have I Paul you turn all we your is for That call Miller. now time

Paul Miller

your everybody, the participation Thank in close you, Thank may Operator, and Yes. interest for TTEC. call. you. you

Operator

earnings This conference third TTEC's call. quarter concludes XXXX

may now You disconnect this time. at

TTEC (TTEC) 10 Nov 222022 Q3 Earnings call transcript