We came across a bullish thesis on Thryv Holdings, Inc. (THRY) on Substack by Inflexio Research. In this article, we will summarize the bulls’ thesis on THRY. Thryv Holdings, Inc. (THRY)'s share was trading at $13.83 as of May 5th. THRY’s trailing and forward P/E were 15.31 and 19.76 respectively according to Yahoo Finance.marketing

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Thryv (THRY) reported its Q1 2025 results on May 1st, delivering a solid performance with some nuances worth monitoring. Total revenue came in at $181.4 million, beating estimates of $174 million, despite being down 22% year-over-year due to the deliberate wind-down of the legacy Marketing Services business. Importantly, SaaS revenue—the core of the investment thesis—grew 50% year-over-year (24% organically) to $111 million, ahead of the $108 million estimate, and now comprises 61% of total revenue. EBITDA also outperformed, landing at $20.9 million versus expectations of $18.9 million, reinforcing the improving profitability of Thryv’s SaaS operations. Management guided Q2 SaaS revenue to $113–115 million, slightly above consensus, but trimmed full-year SaaS revenue guidance by $3–4 million due to macroeconomic caution, not operational softness. The CEO emphasized on the earnings call that he hasn’t observed a weakening trend and is merely being prudent, consistent with broader market behavior where many firms are taking a conservative stance on forward guidance amid uncertain conditions.

A potential point of concern is the sequential decline in SaaS user count, from 99,000 to 96,000, partially reflecting a strategic pivot initiated in late 2024 to shift upmarket. Instead of pushing hard to convert customers from the Marketing Services base, the company is now focusing on higher-value, multi-location clients. This move has led to higher ARPU, which increased from $324 in Q4 to $335 in Q1, and a seasoned net revenue retention (NRR) of 103%, signaling that retained customers are expanding usage and sticking around. The drop in clients from the Marketing Services segment—from 38,000 at year-end 2024 to 34,000 in Q1—means Thryv added approximately 1,000 new SaaS clients from outside that legacy base during the quarter. While this minor contraction isn’t alarming yet, it will be important to track in upcoming quarters to ensure it’s not a sign of plateauing demand.

Nonetheless, the long-term thesis remains intact. Management continues to execute its SaaS transition with solid growth, improving margins, and operational focus. The shift in customer strategy may temporarily suppress raw user growth, but the quality of earnings and customer cohort health is improving. The investment case still hinges on significant upside by 2028, with a base-case fair value of $46.20. Investors willing to tolerate some short-term noise can remain confident in the multi-year story, which is progressing as expected.

Story Continues

Thryv Holdings, Inc. (THRY) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 23 hedge fund portfolios held THRY at the end of the fourth quarter which was 18 in the previous quarter. While we acknowledge the risk and potential of THRY as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than THRY but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.

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