• Fourth Quarter Revenue: $246 million, up 8% year-over-year.
• Fourth Quarter Adjusted EBITDA: $106 million, with a margin of 43%.
• Full Year 2024 Revenue: $945 million, up 9% year-over-year.
• Full Year 2024 Adjusted EBITDA: $397 million, with a margin of 42%.
• Software Gross Dollar Retention (GDR): 99% in Q4 2024.
• Software Net Dollar Retention (NDR): 105% in Q4 2024.
• Adjusted Gross Profit Margin: 76% in Q4 2024.
• Adjusted Operating Expense: $95 million in Q4 2024, up 4% year-over-year.
• Free Cash Flow in Q4: $106 million, up from $75 million in the prior year period.
• Cash and Cash Equivalents: $399 million at the end of Q4 2024.
• Debt: $776 million at the end of Q4 2024; increased to $1 billion after EvolutionIQ acquisition.
• 2025 Revenue Guidance: $1.055 billion to $1.065 billion, 12% growth at the midpoint.
• 2025 Adjusted EBITDA Guidance: $417 million to $427 million, with a margin of 40% at the midpoint.

• Warning! GuruFocus has detected 2 Warning Sign with OLO.

Release Date: February 25, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• CCC Intelligent Solutions Holdings Inc (NASDAQ:CCCS) reported strong financial performance with a total revenue of $246 million for Q4 2024, up 8% year-over-year, and a full-year revenue of $945 million, up 9% year-over-year.
• The company achieved an adjusted EBITDA of $106 million for Q4 2024, surpassing guidance, with an adjusted EBITDA margin of 43%.
• CCC Intelligent Solutions Holdings Inc (NASDAQ:CCCS) expanded its network by onboarding over 1,000 new collision repair facilities and growing its partner ecosystem to over 200 active technology and service providers.
• The company launched several new AI-driven solutions and acquired EvolutionIQ, enhancing its capabilities in disability and workers' compensation markets.
• CCC Intelligent Solutions Holdings Inc (NASDAQ:CCCS) maintained a high software gross dollar retention rate of 99%, reflecting strong customer loyalty and value provided by its solutions.

Negative Points

• Adjusted gross profit margin decreased to 76% in Q4 2024 from 79% in Q4 2023, primarily due to increased depreciation expenses and a mix shift towards lower-margin casualty solutions.
• The company's software net dollar retention rate slightly declined to 105% in Q4 2024 from 106% in Q3 2024.
• CCC Intelligent Solutions Holdings Inc (NASDAQ:CCCS) experienced a 5% year-over-year decline in total claims volume in 2024, impacting transactional revenue.
• The integration of EvolutionIQ is expected to result in a moderate EBITDA loss in 2025, affecting overall margins.
• Stock-based compensation as a percentage of revenue is projected to increase to 15% in 2025 due to the EvolutionIQ acquisition, impacting profitability.

Q & A Highlights

Q: Can you explain the deceleration in organic revenue growth for Q1 2025 compared to 2024? A: Brian Herb, CFO, explained that the deceleration is due to the scaling of EvolutionIQ throughout the year. The organic growth is guided towards the lower end of the 7% to 10% long-term range, with EvolutionIQ contributing to reach the 10% total growth.

Q: What is the current adoption rate and future potential of emerging solutions? A: Brian Herb noted that emerging solutions currently contribute about 1% to total revenue and are growing at over 30%. They are the fastest-growing part of the portfolio outside of EvolutionIQ, with significant engagement and pilots underway with top clients.

Q: Are you still seeing softness in claims volume? A: Brian Herb mentioned that claims volume was down 5% year-over-year in 2024, with some moderation in Q4 due to weather-related events. They are not assuming any significant changes in claims volume for 2025.

Q: How is the pricing strategy impacting growth in 2025? A: Brian Herb stated that pricing is embedded in the Net Dollar Retention (NDR) number but is not a significant driver of growth. The focus remains on balancing the value generated for clients with fair compensation.

Q: What are the expected synergies from the EvolutionIQ acquisition? A: Githesh Ramamurthy, CEO, highlighted that EvolutionIQ's medical summarization capabilities are complementary to CCC's Casualty business. While there is significant growth potential, the 2025 guidance does not include meaningful revenue synergies from the acquisition.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.