Hackett Group: Q4 Earnings Snapshot

The Hackett Group, Inc. (NASDAQ: HCKT), an IP platform-based, Gen AI strategic consulting and executive advisory firm, reported its fourth quarter 2024 financial results on February 18, 2025. The company exceeded its revenue and adjusted earnings per share guidance, demonstrating strong performance and growth potential in the rapidly emerging Gen AI consulting market.



AI XPLR version 3, the company's industry-specific dynamic simulation platform for Gen AI solutions, is set to be released soon. This platform provides multi-AI agent workflows required to build solutions across front, mid, and back-office areas, offering high-margin recurring revenue through licensing. The upcoming release of AI XPLR version 3 is a significant competitive advantage for The Hackett Group, as it enables the company to offer tailored AI solutions to clients in various industries.



The acquisition of LeewayHertz, a highly recognized Gen AI implementation firm, has further enhanced The Hackett Group's end-to-end AI consulting and implementation capabilities. This strategic move allows the company to provide a comprehensive suite of services, from AI strategy and design to implementation and support. The integration of LeewayHertz's operations into The Hackett Group is expected to generate near-term synergies, such as increased revenue and cost savings, as well as long-term synergies, including recurring revenue growth, talent attraction and retention, and market leadership.



The Hackett Group's Q4 2024 financial highlights include:

* Total revenue of $79.2 million, exceeding the high end of guidance
* Revenue before reimbursements of $77.5 million, up from $71.2 million in Q4 2023
* GAAP diluted EPS of $0.12, impacted by non-cash compensation expenses and acquisition-related expenses
* Adjusted diluted EPS of $0.47, exceeding the high end of guidance and up from $0.39 in Q4 2023
* Cash flow from operations of $20.6 million, down from $25.6 million in Q4 2023
* Cash balances of $16.4 million, with $13.0 million outstanding on the Company's credit facility
* A 9% increase in the annual dividend, from $0.44 to $0.48 per share

The Hackett Group's strategic pivot towards Gen AI consulting, supported by proprietary technology platforms and strategic acquisitions, positions the company as a leading Gen AI consultancy firm with highly differentiated software platforms. The company's strong financial performance and growth prospects in the rapidly emerging Gen AI market make it an attractive investment opportunity for those seeking exposure to the AI sector.