TTEC Holdings, Inc. 10-Q

ITEM 1. FINANCIAL STATEMENTS ​ TTEC HOLDINGS, INC. AND SUBSIDIARIES Consolidated Balance Sheets (Amounts in thousands, except share amounts) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, ​ December 31, ​ 2024 2023 ASSETS ​ ​ ​ ​ ​ ​ ​ Current assets ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 96,929 ​ $ 172,747 ​ Accounts receivable, net of allowance of $ 4,761 and $ 2,248 ​ 430,092 ​ 394,868 ​ Prepaids and other current assets ​ 105,355 ​ 95,064 ​ Income and other tax receivables ​ 20,690 ​ 18,524 ​ Total current assets ​ 653,066 ​ 681,203 ​ ​ ​ ​ ​ ​ ​ ​ ​ Long-term assets ​ ​ ​ ​ ​ ​ ​ Property, plant and equipment, net ​ 146,358 ​ 191,003 ​ Assets held for sale ​ ​ 29,640 ​ ​ — ​ Operating lease assets ​ ​ 100,263 ​ ​ 121,574 ​ Goodwill ​ 575,096 ​ 808,988 ​ Deferred tax assets, net ​ 12,398 ​ 38,151 ​ Other intangible assets, net ​ 173,227 ​ 198,433 ​ Income and other tax receivables, long-term ​ ​ 34,469 ​ ​ 44,673 ​ Other long-term assets ​ 101,773 ​ 101,573 ​ Total long-term assets ​ 1,173,224 ​ 1,504,395 ​ Total assets ​ $ 1,826,290 ​ $ 2,185,598 ​ ​ ​ ​ ​ ​ ​ ​ ​ LIABILITIES, STOCKHOLDERS’ EQUITY ​ ​ ​ ​ ​ ​ ​ Current liabilities ​ ​ ​ ​ ​ ​ ​ Accounts payable ​ $ 82,259 ​ $ 96,577 ​ Accrued employee compensation and benefits ​ 121,255 ​ 146,184 ​ Other accrued expenses ​ 26,116 ​ 32,217 ​ Income tax payable ​ 292 ​ 4,909 ​ Deferred revenue ​ 70,834 ​ 81,171 ​ Current operating lease liabilities ​ ​ 35,217 ​ ​ 38,271 ​ Other current liabilities ​ 2,677 ​ 3,698 ​ Total current liabilities ​ 338,650 ​ 403,027 ​ ​ ​ ​ ​ ​ ​ ​ ​ Long-term liabilities ​ ​ ​ ​ ​ ​ ​ Line of credit ​ 1,025,000 ​ 995,000 ​ Deferred tax liabilities, net ​ 15,011 ​ 3,137 ​ Non-current income tax payable ​ ​ — ​ ​ — ​ Non-current operating lease liabilities ​ ​ 79,909 ​ ​ 96,809 ​ Other long-term liabilities ​ 72,586 ​ 72,083 ​ Total long-term liabilities ​ 1,192,506 ​ 1,167,029 ​ Total liabilities ​ 1,531,156 ​ 1,570,056 ​ ​ ​ ​ ​ ​ ​ ​ ​ Commitments and contingencies (Note 10) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Stockholders’ equity ​ ​ ​ ​ ​ ​ ​ Preferred stock; $ 0.01 par value; 10,000,000 shares authorized; zero shares outstanding as of September 30, 2024 and December 31, 2023 ​ ​ — ​ ​ — ​ Common stock; $ 0.01 par value; 150,000,000 shares authorized; 47,724,298 and 47,427,200 shares outstanding as of September 30, 2024 and December 31, 2023, respectively ​ 477 ​ 474 ​ Additional paid-in capital ​ 416,813 ​ 407,415 ​ Treasury stock at cost; 34,328,331 and 34,625,053 shares as of September 30, 2024 and December 31, 2023, respectively ​ ( 584,904 ) ​ ( 589,807 ) ​ Accumulated other comprehensive income (loss) ​ ( 99,697 ) ​ ( 89,876 ) ​ Retained earnings ​ 544,616 ​ 870,429 ​ Noncontrolling interest ​ 17,829 ​ 16,907 ​ Total stockholders’ equity ​ 295,134 ​ 615,542 ​ Total liabilities, stockholders’ equity and mezzanine equity ​ $ 1,826,290 ​ $ 2,185,598 ​ ​ The accompanying notes are an integral part of these consolidated financial statements. ​ ​ 1 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Consolidated Statements of Comprehensive Income (Loss) (Amounts in thousands, except per share amounts) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three months ended September 30, ​ Nine months ended September 30, ​ 2024 2023 2024 2023 Revenue ​ $ 529,427 ​ $ 602,956 ​ $ 1,640,150 ​ $ 1,836,636 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cost of services (exclusive of depreciation and amortization presented separately below) ​ 415,226 ​ 479,699 ​ 1,286,934 ​ 1,427,064 ​ Selling, general and administrative ​ 71,580 ​ 66,781 ​ 219,881 ​ 216,129 ​ Depreciation and amortization ​ 24,042 ​ 25,595 ​ 74,258 ​ 76,368 ​ Restructuring charges, net ​ ​ 1,002 ​ ​ 1,369 ​ ​ 6,346 ​ ​ 4,895 ​ Impairment losses ​ 4,688 ​ 4,124 ​ 241,544 ​ 11,083 ​ Total operating expenses ​ 516,538 ​ 577,568 ​ 1,828,963 ​ 1,735,539 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income (loss) from operations ​ 12,889 ​ 25,388 ​ ( 188,813 ) ​ 101,097 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other income (expense) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest income ​ 263 ​ 1,342 ​ 1,660 ​ 3,632 ​ Interest expense ​ ( 21,684 ) ​ ( 20,327 ) ​ ( 63,186 ) ​ ( 56,709 ) ​ Other income (expense), net ​ ​ ( 1,041 ) ​ ​ 687 ​ 953 ​ ( 2,232 ) ​ Total other income (expense) ​ ( 22,462 ) ​ ( 18,298 ) ​ ( 60,573 ) ​ ( 55,309 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income (loss) before income taxes ​ ( 9,573 ) ​ 7,090 ​ ( 249,386 ) ​ 45,788 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Provision for income taxes ​ ( 9,395 ) ​ ( 5,294 ) ​ ( 65,850 ) ​ ( 19,318 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) ​ ( 18,968 ) ​ 1,796 ​ ( 315,236 ) ​ 26,470 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) attributable to noncontrolling interest ​ ( 2,154 ) ​ ( 3,326 ) ​ ( 7,730 ) ​ ( 8,142 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) attributable to TTEC stockholders ​ $ ( 21,122 ) ​ $ ( 1,530 ) ​ $ ( 322,966 ) ​ $ 18,328 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive income (loss) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) ​ $ ( 18,968 ) ​ $ 1,796 ​ $ ( 315,236 ) ​ $ 26,470 ​ Foreign currency translation adjustments ​ 5,000 ​ ( 10,312 ) ​ ( 6,218 ) ​ 18,453 ​ Derivative valuation, gross ​ 3,010 ​ ( 3,752 ) ​ ( 6,154 ) ​ 5,821 ​ Derivative valuation, tax effect ​ — ​ 976 ​ 2,379 ​ ( 1,521 ) ​ Other, net of tax ​ 60 ​ 119 ​ 272 ​ 299 ​ Total other comprehensive income (loss) ​ 8,070 ​ ( 12,969 ) ​ ( 9,721 ) ​ 23,052 ​ Total comprehensive income (loss) ​ ( 10,898 ) ​ ( 11,173 ) ​ ( 324,957 ) ​ 49,522 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less: Comprehensive income attributable to noncontrolling interest ​ ( 2,340 ) ​ ( 2,620 ) ​ ( 7,830 ) ​ ( 7,005 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Comprehensive income (loss) attributable to TTEC stockholders ​ $ ( 13,238 ) ​ $ ( 13,793 ) ​ $ ( 332,787 ) ​ $ 42,517 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average shares outstanding ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ 47,723 ​ 47,415 ​ 47,573 ​ 47,305 ​ Diluted ​ ​ 47,860 ​ 47,488 ​ 47,618 ​ 47,417 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) per share attributable to TTEC stockholders ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ $ ( 0.44 ) ​ $ ( 0.03 ) ​ $ ( 6.79 ) ​ $ 0.39 ​ Diluted ​ $ ( 0.44 ) ​ $ ( 0.03 ) ​ $ ( 6.78 ) ​ $ 0.39 ​ ​ The accompanying notes are an integral part of these consolidated financial statements. ​ 2 Table of Contents ​ TTEC HOLDINGS, INC. AND SUBSIDIARIES Consolidated Statements of Stockholders’ Equity and Mezzanine Equity (Amounts in thousands) (Unaudited) Three months ended September 30, 2023 and 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Stockholders’ Equity of the Company ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Common Stock ​ Treasury ​ Additional ​ Comprehensive ​ Retained ​ Noncontrolling ​ ​ ​ ​ Mezzanine ​ ​ Shares ​ Amount ​ Stock ​ Paid-in Capital ​ Income (Loss) ​ Earnings ​ interest ​ Total Equity ​ Equity Balance as of June 30, 2023 47,276 ​ $ 473 ​ $ ( 592,306 ) ​ $ 396,444 ​ $ ( 90,463 ) ​ $ 906,518 ​ $ 16,876 ​ $ 637,542 ​ $ 3,997 ​ Net income — ​ — ​ — ​ — ​ — ​ ​ ( 1,530 ) ​ 3,013 ​ 1,483 ​ ​ 313 ​ Dividends to shareholders ($ 0.52 per common share) ​ — ​ — ​ — ​ — ​ — ​ ​ ( 24,660 ) ​ ​ — ​ ​ ( 24,660 ) ​ ​ — ​ Dividends distributed to noncontrolling interest — ​ — ​ — ​ — ​ — ​ — ​ ( 2,520 ) ​ ( 2,520 ) ​ ​ — ​ Foreign currency translation adjustments — ​ — ​ — ​ — ​ ( 9,919 ) ​ — ​ ( 393 ) ​ ( 10,312 ) ​ ​ — ​ Derivatives valuation, net of tax — ​ — ​ — ​ — ​ ( 2,776 ) ​ — ​ — ​ ( 2,776 ) ​ ​ — ​ Vesting of restricted stock units 143 ​ 1 ​ 2,358 ​ ( 4,668 ) ​ — ​ — ​ — ​ ( 2,309 ) ​ ​ — ​ Equity-based compensation expense — ​ — ​ — ​ 6,608 ​ — ​ — ​ — ​ 6,608 ​ ​ — ​ Other, net of tax — ​ — ​ — ​ — ​ 119 ​ — ​ — ​ 119 ​ ​ — ​ Balance as of September 30, 2023 47,419 ​ $ 474 ​ $ ( 589,948 ) ​ $ 398,384 ​ $ ( 103,039 ) ​ $ 880,328 ​ $ 16,976 ​ $ 603,175 ​ $ 4,310 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Stockholders’ Equity of the Company ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Common Stock ​ Treasury ​ Additional ​ Comprehensive ​ Retained ​ Noncontrolling ​ ​ ​ ​ Mezzanine ​ ​ Shares ​ Amount ​ Stock ​ Paid-in Capital ​ Income (Loss) ​ Earnings ​ interest ​ Total Equity ​ Equity Balance as of June 30, 2024 47,608 ​ $ 476 ​ $ ( 586,812 ) ​ $ 414,728 ​ $ ( 107,581 ) ​ $ 565,738 ​ $ 17,627 ​ $ 304,176 ​ $ — ​ Net (loss) income — ​ — ​ — ​ — ​ — ​ ( 21,122 ) ​ 2,154 ​ ( 18,968 ) ​ ​ — ​ Dividends to shareholders ($ 0.00 per common share) ​ — ​ — ​ — ​ — ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ Dividends distributed to noncontrolling interest — ​ — ​ — ​ — ​ — ​ — ​ ( 2,138 ) ​ ( 2,138 ) ​ ​ — ​ Foreign currency translation adjustments — ​ — ​ — ​ — ​ 4,814 ​ — ​ 186 ​ 5,000 ​ ​ — ​ Derivatives valuation, net of tax — ​ — ​ — ​ — ​ 3,010 ​ — ​ — ​ 3,010 ​ ​ — ​ Vesting of restricted stock units 116 ​ 1 ​ 1,908 ​ ( 2,248 ) ​ — ​ — ​ — ​ ( 339 ) ​ ​ — ​ Equity-based compensation expense — ​ — ​ — ​ 4,333 ​ — ​ — ​ — ​ 4,333 ​ ​ — ​ Other, net of tax — ​ — ​ — ​ — ​ 60 ​ — ​ — ​ 60 ​ ​ — ​ Balance as of September 30, 2024 47,724 ​ $ 477 ​ $ ( 584,904 ) ​ $ 416,813 ​ $ ( 99,697 ) ​ $ 544,616 ​ $ 17,829 ​ $ 295,134 ​ $ — ​ ​ Nine months ended September 30, 2023 and 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Stockholders’ Equity of the Company ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Common Stock ​ Treasury ​ Additional ​ Comprehensive ​ Retained ​ Noncontrolling ​ ​ ​ ​ Mezzanine ​ ​ Shares ​ Amount ​ Stock ​ Paid-in Capital ​ Income (Loss) ​ Earnings ​ interest ​ Total Equity ​ Equity Balance as of December 31, 2022 47,224 ​ $ 472 ​ $ ( 593,164 ) ​ $ 367,673 ​ $ ( 126,301 ) ​ $ 911,233 ​ $ 18,192 ​ $ 578,105 ​ $ 55,645 ​ Noncontrolling interest adjustment due to buyout ​ — ​ ​ — ​ ​ — ​ ​ 20,457 ​ ​ — ​ ​ — ​ ​ — ​ ​ 20,457 ​ ​ ( 20,457 ) ​ Net income — ​ — ​ — ​ — ​ — ​ ​ 18,328 ​ 7,215 ​ 25,543 ​ ​ 927 ​ Dividends to shareholders ($ 1.04 per common share) ​ — ​ — ​ — ​ — ​ — ​ ​ ( 49,233 ) ​ ​ — ​ ​ ( 49,233 ) ​ ​ — ​ Buyout of noncontrolling interest ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 31,619 ) ​ Dividends distributed to noncontrolling interest — ​ — ​ — ​ — ​ — ​ — ​ ( 8,221 ) ​ ( 8,221 ) ​ ​ ( 186 ) ​ Foreign currency translation adjustments — ​ — ​ — ​ — ​ 18,663 ​ — ​ ( 210 ) ​ 18,453 ​ ​ — ​ Derivatives valuation, net of tax — ​ — ​ — ​ — ​ 4,300 ​ — ​ — ​ 4,300 ​ ​ — ​ Vesting of restricted stock units 195 ​ 2 ​ 3,216 ​ ( 6,156 ) ​ — ​ — ​ — ​ ( 2,938 ) ​ ​ — ​ Equity-based compensation expense — ​ — ​ — ​ 16,410 ​ — ​ — ​ — ​ 16,410 ​ ​ — ​ Other, net of tax — ​ — ​ — ​ — ​ 299 ​ — ​ — ​ 299 ​ ​ — ​ Balance as of September 30, 2023 47,419 ​ $ 474 ​ $ ( 589,948 ) ​ $ 398,384 ​ $ ( 103,039 ) ​ $ 880,328 ​ $ 16,976 ​ $ 603,175 ​ $ 4,310 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Stockholders’ Equity of the Company ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Common Stock ​ Treasury ​ Additional ​ Comprehensive ​ Retained ​ Noncontrolling ​ ​ ​ ​ Mezzanine ​ ​ Shares ​ Amount ​ Stock ​ Paid-in Capital ​ Income (Loss) ​ Earnings ​ interest ​ Total Equity ​ Equity Balance as of December 31, 2023 47,427 ​ $ 474 ​ $ ( 589,807 ) ​ $ 407,415 ​ $ ( 89,876 ) ​ $ 870,429 ​ $ 16,907 ​ $ 615,542 ​ $ — ​ Net (loss) income — ​ — ​ — ​ — ​ — ​ ( 322,966 ) ​ 7,730 ​ ( 315,236 ) ​ ​ — ​ Dividends to shareholders ($ 0.06 per common share) ​ — ​ — ​ — ​ — ​ — ​ ​ ( 2,847 ) ​ ​ — ​ ​ ( 2,847 ) ​ ​ — ​ Dividends distributed to noncontrolling interest — ​ — ​ — ​ — ​ — ​ — ​ ( 6,908 ) ​ ( 6,908 ) ​ ​ — ​ Foreign currency translation adjustments — ​ — ​ — ​ — ​ ( 6,318 ) ​ — ​ 100 ​ ( 6,218 ) ​ ​ — ​ Derivatives valuation, net of tax — ​ — ​ — ​ — ​ ( 3,775 ) ​ — ​ — ​ ( 3,775 ) ​ ​ — ​ Vesting of restricted stock units 297 ​ 3 ​ 4,903 ​ ( 5,851 ) ​ — ​ — ​ — ​ ( 945 ) ​ ​ — ​ Equity-based compensation expense — ​ — ​ — ​ 15,249 ​ — ​ — ​ — ​ 15,249 ​ ​ — ​ Other, net of tax — ​ — ​ — ​ — ​ 272 ​ — ​ — ​ 272 ​ ​ — ​ Balance as of September 30, 2024 47,724 ​ $ 477 ​ $ ( 584,904 ) ​ $ 416,813 ​ $ ( 99,697 ) ​ $ 544,616 ​ $ 17,829 ​ $ 295,134 ​ $ — ​ ​ ​ ​ The accompanying notes are an integral part of these consolidated financial statements. ​ ​ 3 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows (Amounts in thousands) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Nine Months Ended September 30, ​ ​ 2024 2023 Cash flows from operating activities ​ ​ ​ ​ ​ ​ ​ Net income (loss) ​ $ ( 315,236 ) ​ $ 26,470 ​ Adjustments to reconcile net income (loss) to net cash provided by operating activities: ​ ​ ​ ​ ​ ​ ​ Depreciation and amortization ​ 74,258 ​ 76,368 ​ Amortization of contract acquisition costs ​ 1,363 ​ 1,596 ​ Amortization of debt issuance costs ​ 1,578 ​ 801 ​ Imputed interest expense and fair value adjustments to contingent consideration ​ ( 1,496 ) ​ 6,864 ​ Provision for credit losses ​ 2,744 ​ 1,677 ​ Loss on disposal of assets ​ ​ 1,778 ​ ​ 1,176 ​ Loss on dissolution of subsidiary ​ ​ — ​ ​ 301 ​ Impairment losses ​ 241,544 ​ 11,083 ​ Deferred income taxes ​ 38,922 ​ ( 12,288 ) ​ Excess tax benefit from equity-based awards ​ 3,921 ​ 1,807 ​ Equity-based compensation expense ​ 15,249 ​ 16,410 ​ Loss on foreign currency derivatives ​ 244 ​ 552 ​ Changes in assets and liabilities, net of acquisitions: ​ ​ ​ ​ ​ ​ ​ Accounts receivable ​ ( 37,497 ) ​ 34,995 ​ Prepaids and other assets ​ ( 12,959 ) ​ ( 1,620 ) ​ Accounts payable and accrued expenses ​ ( 49,122 ) ​ ( 8,453 ) ​ Deferred revenue and other liabilities ​ ( 23,023 ) ​ ( 44,508 ) ​ Net cash provided by operating activities ​ ( 57,732 ) ​ 113,231 ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash flows from investing activities ​ ​ ​ ​ ​ ​ ​ Proceeds from sale of long-lived assets ​ 146 ​ 246 ​ Purchases of property, plant and equipment, net of acquisitions ​ ( 36,465 ) ​ ( 54,722 ) ​ Net cash used in investing activities ​ ( 36,319 ) ​ ( 54,476 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash flows from financing activities ​ ​ ​ ​ ​ ​ ​ Proceeds from/(repayments of) line of credit, net ​ 30,000 ​ 4,000 ​ Payments on other debt ​ ( 1,873 ) ​ ( 1,929 ) ​ Payments of contingent consideration and hold back payments to acquisitions ​ — ​ ( 37,676 ) ​ Dividends paid to shareholders ​ ​ ( 2,847 ) ​ ​ ( 24,572 ) ​ Payments to noncontrolling interest ​ ( 6,908 ) ​ ( 8,407 ) ​ Tax payments related to issuance of restricted stock units ​ ​ ( 945 ) ​ ​ ( 2,938 ) ​ Payments of debt issuance costs ​ ( 2,635 ) ​ — ​ Net cash (used in)/provided by financing activities ​ 14,792 ​ ( 71,522 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of exchange rate changes on cash, cash equivalents and restricted cash ​ 2,283 ​ 3,889 ​ ​ ​ ​ ​ ​ ​ ​ ​ Decrease in cash, cash equivalents and restricted cash ​ ( 76,976 ) ​ ( 8,878 ) ​ Cash, cash equivalents and restricted cash, beginning of period ​ 173,905 ​ 167,064 ​ Cash, cash equivalents and restricted cash, end of period ​ $ 96,929 ​ $ 158,186 ​ ​ ​ ​ ​ ​ ​ ​ ​ Supplemental disclosures ​ ​ ​ ​ ​ ​ ​ Cash paid for interest ​ $ 60,976 ​ $ 55,810 ​ Cash paid for income taxes ​ $ 36,158 ​ $ 35,542 ​ Non-cash investing and financing activities ​ ​ ​ ​ ​ ​ ​ Acquisition of long-lived assets through finance leases ​ $ 886 ​ $ 1,560 ​ Acquisition of equipment through increase in accounts payable, net ​ $ ( 669 ) ​ $ 3,534 ​ Dividend declared but not paid ​ $ — ​ $ 24,660 ​ ​ The accompanying notes are an integral part of these consolidated financial statements. ​ ​ 4 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) (1) OVERVIEW AND BASIS OF PRESENTATION Summary of Business Founded in 1982 , TTEC Holdings, Inc. (“TTEC”, “the Company”; pronounced “T-TEC”) is a global customer experience (“CX”) outsourcing partner for marquee and disruptive brands and public sector clients. The Company designs, builds, and operates technology-enabled customer experiences across digital and live interaction channels to help clients increase customer loyalty, revenue, and profitability. By combining digital solutions with data-driven service capabilities, the Company helps clients improve their customer satisfaction while lowering their total cost to serve. As of September 30, 2024, TTEC served approximately 750 clients across targeted industry verticals including financial services, healthcare, public sector, telecom, technology, media, travel and hospitality, automotive and retail. The Company operates and reports its financial results of operation through two business segments: • TTEC Digital is one of the largest CX technology providers and is focused exclusively on the intersection of Contact Center as a Service (CCaaS), Customer Relationship Management (CRM), and Artificial Intelligence (AI) and Analytics. A professional services organization comprised of software engineers, systems architects, data scientists and CX strategists, this segment creates and implements strategic CX transformation roadmaps; sells, operates, and provides managed services for cloud platforms and premise based CX technologies including Amazon Web Services (“AWS”), Cisco, Genesys, Google, and Microsoft; and creates proprietary IP to support industry specific and custom client needs. TTEC Digital serves clients across enterprise and small and medium-sized business segments and has a dedicated unit with government technology certifications serving the public sector. • TTEC Engage provides the digitally enabled CX operational and managed services to support large, complex enterprise clients’ end-to-end customer interactions at scale. Tailored to meet industry-specific and business needs, this segment delivers data-driven omnichannel customer care, customer acquisition, growth, and retention services, tech support, trust and safety and back-office solutions. The segment’s technology-enabled delivery model covers the entire associate lifecycle including recruitment, onboarding, training, delivery, workforce management and quality assurance. TTEC demonstrates its market leadership through strategic collaboration across TTEC Digital and TTEC Engage when there is client demand and fit for the Company’s integrated solutions. This partnership is central to the Company’s ability to deliver comprehensive and transformational customer experience solutions to its clients, including integrated delivery, go-to-market and innovation for truly differentiated, market leading CX solutions. During the third quarter of 2024, the combined TTEC Digital and TTEC Engage global operating platform delivered onshore, nearshore and offshore services in 22 countries on six continents – the United States, Australia, Belgium, Brazil, Bulgaria, Canada, Colombia, Costa Rica, Egypt, Germany, Greece, Honduras, India, Ireland, Mexico, the Netherlands, New Zealand, the Philippines, Poland, South Africa, Thailand, and the United Kingdom – with the help of approximately 51,600 customer care associates, consultants, technologists, and CX professionals. Basis of Presentation The Consolidated Financial Statements are comprised of the accounts of TTEC, its wholly owned subsidiaries, its 55 % equity owned subsidiary Percepta, LLC, its 70 % equity owned subsidiary First Call Resolution, LLC through March 31, 2023 and then 100 % owned subsequently, and its 70 % equity owned subsidiary Serendebyte, Inc. through December 31, 2023 and then 100 % owned subsequently (see Note 2). All intercompany balances and transactions have been eliminated in consolidation. 5 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) The unaudited Consolidated Financial Statements do not include all of the disclosures required by accounting principles generally accepted in the U.S. (“GAAP”), pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The unaudited Consolidated Financial Statements reflect all adjustments which, in the opinion of management, are necessary to state fairly the consolidated financial position of the Company and the consolidated results of operations and comprehensive income (loss) and the consolidated cash flows of the Company. All such adjustments are of a normal, recurring nature. Operating results for the periods presented are not necessarily indicative of the results that may be expected for the year ending December 31, 2024. These unaudited Consolidated Financial Statements should be read in conjunction with the Company’s audited Consolidated Financial Statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. Use of Estimates The preparation of the Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions in determining the reported amounts of assets and liabilities, disclosure of contingent liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenue and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates including those related to derivatives and hedging activities, income taxes including the valuation allowance for deferred tax assets, litigation reserves, restructuring reserves, allowance for credit losses, contingent consideration, redeemable noncontrolling interest, and valuation of goodwill, long-lived and intangible assets. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ materially from these estimates under different assumptions or conditions. Out-of-period Adjustment The Consolidated Financial Statements for the three months ended June 30, 2023 included an adjustment of $ 14.2 million to other comprehensive income and deferred tax assets, to correct for an error identified by management during the preparation of the financial statements. This adjustment was to reflect the deferred tax impact of currency translation adjustments, of which $ 14.2 million related to prior annual fiscal periods. Management has determined that this error was not material to the historical financial statements in any individual period or in the aggregate and did not result in the previously issued financial statements being materially misstated. The impact to the three and six month periods ended June 30, 2023 was not material. As such, management recorded the correction as an out-of-period adjustment in the three months ended June 30, 2023. Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents consist of cash, primarily held in interest-bearing investments, and liquid short-term investments, which have original maturities of three months or less. Restricted cash includes cash whereby the Company’s ability to use the funds at any time is contractually limited or is generally designated for specific purposes arising out of certain contractual or other obligations. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the Consolidated Balance Sheets that sum to the amounts reported in the Consolidated Statement of Cash Flows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, 2024 December 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ ​ $ 96,929 $ 172,747 ​ Restricted cash included in "Prepaid and other current assets" ​ ​ — ​ 1,158 ​ Total ​ ​ $ 96,929 $ 173,905 ​ ​ 6 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) Concentration of Credit Risk The Company is exposed to credit risk in the normal course of business, primarily related to accounts receivable and derivative instruments. Historically, the losses related to credit risk have been immaterial, but in light of recent economic headwinds the Company has monitored its collection processes to reduce its credit risk. The Company regularly monitors its credit risk to mitigate the possibility of current and future exposures resulting in a loss. The Company evaluates the creditworthiness of its clients prior to entering into an agreement to provide services and as necessary through the life of the client relationship. The Company does not believe it is exposed to more than a nominal amount of credit risk in its derivative hedging activities, as the Company diversifies its activities across eight investment-grade financial institutions. Recently Adopted Accounting Pronouncements In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, “Reference Rate Reform” (Topic 848), which provides optional expedients and exceptions for contracts, hedging relationships, and other transactions affected by reference rate reform due to the anticipated cessation of the London Interbank Offered Rate (”LIBOR”). The ASU is effective from March 12, 2020, may be applied prospectively and could impact the accounting for LIBOR provisions in the Company’s credit facility agreement. In addition, in January 2021, the FASB issued ASU 2021-01, “Reference Rate Reform – Scope,” which clarified the scope of FASB Accounting Standards Codification (“ASC”) 848 relating to contract modifications. The Company adopted the standard effective April 1, 2023 and the adoption of this guidance did not have a material impact on the Company’s financial position, results of operations or cash flows. Other Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, “Segment Reporting - Improvements to Reportable Segment Disclosures” which relates to disclosures regarding a public entity’s reportable segments and provides more detailed information about a reportable segment’s expenses. The ASU is effective for fiscal years beginning after December 15, 2023 and interim periods beginning after December 15, 2024, with retrospective application required. The Company is assessing the effect on its annual consolidated financial statement disclosures; however, adoption is not expected to have a material impact on the Company’s Consolidated Financial Statements. In December 2023, the FASB issued ASU 2023-09, “Improvements to Income Tax Disclosures” to enhance the transparency and decision usefulness of income tax disclosures. The ASU is effective for fiscal years beginning after December 15, 2024, with retrospective application permitted. The Company is assessing the effect on its annual consolidated financial statement disclosures; however, adoption is not expected to have a material impact on the Company’s Consolidated Financial Statements. In November 2024, the FASB issued ASU 2024-03, “Disaggregation of Income Statement Expenses” in response to longstanding requests from investors for more information about an entity’s expenses, specifically categories of expenses such as (purchases of inventory, employee compensation, depreciation, and amortization, and depletion). The ASU is effective for fiscal years beginning after December 15, 2026, with retrospective application permitted. The Company is still evaluating the potential impact of the pronouncement. ​ ​ (2) ACQUISITIONS AND DIVESTITURES Serendebyte In connection with the acquisition by TTEC Digital, LLC of a 70 % interest in Serendebyte Inc. (“Serendebyte”), Serendebyte’s founder exercised his put rights with respect to the remaining 30 % interest in Serendebyte on December 8, 2023, but failed to fulfill the agreed exercise prerequisites. 7 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) In connection with triggering the option, on December 8, 2023, a $ 0.3 million accrual was reclassified from Redeemable noncontrolling interest to Accrued expenses and the remaining balance was reclassified to Additional paid in capital. FCR Pursuant to the Membership Interest Purchase Agreement of October 26, 2019 between Ortana Holdings, Inc. and TTEC Services Corporation (the FCR “MIPA”) for the acquisition by TTEC of a 70 % interest in First Call Resolution, LLC (“FCR”), Ortana Holdings exercised its put rights in January 2023, which required TTEC to acquire Ortana Holdings’ remaining 30 % interest in FCR. The purchase price for the remaining 30% interest was determined based on the express provisions of the FCR MIPA and was based on FCR’s performance during 2022. The buyout agreement was signed on April 4, 2023 and reflected a buyout purchase of $22.4 million. In connection with the triggering of the option, as of March 31, 2023, the $ 22.4 million purchase price was reclassified from Redeemable noncontrolling interest to Accrued expenses and the remaining balance of $ 20.5 million was reclassified to Additional paid in capital. In February 2023, a $ 9.2 million payment related to excess cash distribution was completed and in April 2023 the final payment of $ 22.4 million was completed. Certain Assets of Faneuil On April 1, 2022 , the Company completed an asset acquisition through its subsidiary TTEC Government Solutions LLC, of certain public sector citizen experience contracts in the transportation infrastructure and healthcare exchange industries from Faneuil, Inc., a subsidiary of ALJ Regional Holdings, Inc. (“the Faneuil Transaction”). The acquired business is operated as part of the TTEC Engage segment and was fully consolidated into the financial statements of TTEC. The Faneuil Transaction was recorded as a business combination under ASC 805, Business Combinations, with identifiable assets acquired and liabilities assumed recorded at their estimated fair values as of the acquisition date. Total cash paid at the time of acquisition was $ 142.4 million. The Faneuil Transaction included contingent payments that were based on the revenue and EBITDA performance of certain contracts with the value of the contingent payments to be determined. During the second quarter of 2023, the contingent payment obligation was modified to a minimum payment of $ 7.4 million and a maximum payment of $ 10.4 million. An initial payment of $ 7.4 million was completed in May 2023. During 2023, a combined $ 3.0 million net expense was recorded related to fair value adjustments for the estimated contingent payment based on changes in estimated EBITDA, the timing of cash flows and market interest rate changes. These benefits (expenses) were included in Other income (expense) in the Consolidated Statements of Comprehensive Income (Loss). For the nine months ended September 30, 2024, a $ 1.5 million net gain was recorded related to fair value adjustments for the estimated contingent payment based on changes in estimated EBITDA, the timing of cash flows and market interest rate changes. As of September 30, 2024, the contingent payment is accrued at $ 0.0 million. 8 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) The Faneuil Transaction included an indemnity escrow which was disbursed as a holdback payment on the acquisition date. The indemnity payments related to real estate and technology funds that were spent post-close related to various IT upgrades and real estate expenses, and indemnity related to potential future employee wage increases. The indemnity payments were valued based on a weighted average of several current scenarios and a receivable of $ 10.4 million was recorded as of the acquisition date. During the third and fourth quarters of 2022 and the first quarter of 2023, reductions in the fair value were calculated and a $ 4.4 million expense, a $ 0.2 million expense and a $ 2.5 million expense, respectively, were recorded related to fair value adjustments for the receivable based on current information reflecting a better outcome with the contract negotiations and lower anticipated IT and facilities spending. During the second quarter of 2023, the payout value related to the IT and facilities reimbursement was finalized at $ 1.3 million, and an expense of $ 1.9 million was recorded. The payment was received by TTEC in May 2023 and as of June 30, 2023, the receivables were reduced to zero on the Consolidated Balance Sheet. The reductions in fair value related expenses were included in Other income (expense) in the Consolidated Statements of Comprehensive Income (Loss). A multi-period excess earnings method under the income approach was used to estimate the fair value of the customer relationships intangible assets. The significant assumptions utilized in calculating the fair value of the customer relationships intangible assets were the customer attrition rate, revenue growth rates, forecasted EBITDA, contributory asset charge, and the discount rate. The following summarizes the fair values of the identifiable assets acquired and liabilities assumed as of the acquisition date (in thousands): ​ ​ ​ ​ ​ ​ ​ Acquisition Date ​ ​ Fair Value Cash ​ $ — ​ Accounts receivable, net ​ 704 ​ Prepaid and other assets ​ 8,420 ​ Net fixed assets ​ ​ 5,622 ​ Right of use lease assets ​ ​ 17,778 ​ Other assets ​ ​ 2,572 ​ Customer relationships ​ ​ 61,310 ​ Goodwill ​ ​ 75,902 ​ ​ ​ $ 172,308 ​ ​ ​ ​ ​ ​ Accrued employee compensation ​ $ 202 ​ Accrued expenses ​ 2,763 ​ Right of use lease liability – current ​ 3,129 ​ Right of use lease liability – non-current ​ ​ 14,092 ​ Deferred income ​ ​ 811 ​ Other liabilities ​ 8,891 ​ ​ ​ $ 29,888 ​ ​ ​ ​ ​ ​ Total purchase price ​ $ 142,420 ​ ​ In the first quarter of 2023, the Company finalized the valuation of Faneuil for the acquisition date assets acquired and liabilities assumed and determined that no material adjustments to any of the balances were required. 9 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) The Faneuil customer relationships are being amortized over a useful life of 10 years . The goodwill recognized from the Faneuil acquisition is attributable to, but not limited to, the acquired workforce and expected synergies with the TTEC Engage segment. The tax basis of the acquired intangibles and goodwill will be materially deductible for income tax purposes. The acquired goodwill and intangibles and operating results of Faneuil are reported within the TTEC Engage segment from the date of acquisition. Assets Held for Sale As of September 30, 2024, the Company had assets classified as held for sale of $ 29.6 million as the Company expects to sell its former headquarters building in Englewood, Colorado within the next twelve months. This included $ 16.9 million from leasehold improvements, $ 6.7 million from buildings, $ 5.9 million from land, and $ 0.1 million from other Property, plant and equipment categories. These assets are allocated 85 % to the TTEC Engage segment and 15 % to the TTEC Digital segment. Funds received will be used to reduce the Company’s existing debt. The Company ceased depreciation on the assets upon reclassification. The estimated fair value less costs to sell the assets held for sale exceeded their carrying value as of the quarter ended September 30, 2024 and no impairment was considered necessary. Subsequent Event On November 5, 2024, TTEC Holdings, Inc., through its wholly-owned subsidiary, TTEC Services Corporation, entered into a definitive agreement to sell and subsequently closed the sale of a real estate asset in Englewood, Colorado to Catholic Health Initiatives Colorado, a not-for-profit organization, for $ 45.5 million, subject to certain customary adjustments. The Company expects to record a pre-tax gain of approximately $ 16.0 million upon close of the transaction in the fourth quarter of 2024. The asset was previously used by TTEC as its principal executive offices and was not used in business operations. The Company intends to use the proceeds from the sale to reduce its outstanding balance under its revolving line of credit. ​ ​ ​ (3) SEGMENT INFORMATION The Company reports the following two segments: TTEC Digital and the CX Technology Services Industry TTEC Digital buyers are seeking solutions in several areas including cost optimization, migration from outdated legacy platforms to more agile cloud environments, lack of CX talent and expertise and a need for a practical way forward with AI. TTEC Digital takes a technology-agnostic approach to these challenges and focuses on designing and delivering solutions specific to each client’s specifications. TTEC Digital has entered into strategic partnerships with the leading CX software vendors including Genesys, Microsoft, Cisco, AWS and Google which positions TTEC Digital to support the majority of CX platform requirements. TTEC Digital’s solutions are built to respond to market needs for both enterprise and small and medium-sized business clients. AI design and delivery capabilities are woven across all four of the following pillars. • Professional Services: CX and AI solution planning, design, and implementation services • Managed Services: Cloud application and premise support • CX Consulting, Analytics and AI: Transformation strategy and design, data science, engineering, and visualization • IP & Software: Custom software engineering through TTEC Digital’s IP and Software division The segment has a three-pronged go to market strategy that includes growing existing client relationships, partner channel motions and general market development. In 2023, TTEC Digital expanded its Hyderabad Innovation Studio in India with the goal of continuing to expand its offshore delivery capabilities, and currently approximately 40 % of the staff are located in one of several offshore locations. For the nine months ended September 30, 2023, 40 % of the staff were located in one of several offshore locations. 10 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) TTEC Engage and the CX Business Process Outsourcing Services Industry The TTEC Engage segment’s solutions are built to respond to the following market needs for clients. • Customer Support • Tech Support • Revenue Generation and Growth Services • Trust & Safety • AI Operations, including data annotation and labeling • Back-office Support TTEC Engage goes to market through a vertical approach with customized solutions that include industry-specific talent, technology, certifications, and capabilities. For example, in the Banking, Financial Services and Insurance (“BFSI”) vertical, we support several lines of business with customized offerings for retail banking, online banking, credit card, property and casualty and loans. In healthcare, the segment supports care, technical support, revenue generation and back-office capabilities to meet the needs of payer, provider, clinical and pharma clients. The Company allocates to each segment its portion of corporate operating expenses. All intercompany transactions between the reported segments for the periods presented have been eliminated. The following tables present certain financial data by segment (in thousands): Three Months Ended September 30, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation Income ​ ​ Gross ​ Intersegment ​ Net ​ & ​ from ​ ​ Revenue ​ Sales ​ Revenue ​ Amortization ​ Operations TTEC Digital ​ $ 115,669 ​ $ — ​ $ 115,669 ​ $ 6,986 ​ $ 7,474 ​ TTEC Engage ​ 413,758 ​ — ​ 413,758 ​ 17,056 ​ 5,415 ​ Total ​ $ 529,427 ​ $ — ​ $ 529,427 ​ $ 24,042 ​ $ 12,889 ​ ​ Three Months Ended September 30, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation Income ​ ​ Gross ​ Intersegment ​ Net ​ & ​ from ​ ​ Revenue ​ Sales ​ Revenue ​ Amortization ​ Operations TTEC Digital ​ $ 133,252 ​ $ — ​ $ 133,252 ​ $ 6,801 ​ $ 11,925 ​ TTEC Engage ​ 469,704 ​ — ​ 469,704 ​ 18,794 ​ 13,463 ​ Total ​ $ 602,956 ​ $ — ​ $ 602,956 ​ $ 25,595 ​ $ 25,388 ​ ​ Nine Months Ended September 30, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation Income/ ​ ​ Gross ​ Intersegment ​ Net ​ & ​ (loss) from ​ ​ Revenue ​ Sales ​ Revenue ​ Amortization ​ Operations TTEC Digital ​ $ 344,068 ​ $ — ​ $ 344,068 ​ $ 21,051 ​ $ 16,771 ​ TTEC Engage ​ 1,296,082 ​ — ​ 1,296,082 ​ 53,207 ​ ( 205,584 ) ​ Total ​ $ 1,640,150 ​ $ — ​ $ 1,640,150 ​ $ 74,258 ​ $ ( 188,813 ) ​ ​ 11 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) Nine Months Ended September 30, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation Income ​ ​ Gross ​ Intersegment ​ Net ​ & ​ from ​ ​ Revenue ​ Sales ​ Revenue ​ Amortization ​ Operations TTEC Digital ​ $ 367,764 ​ $ — ​ $ 367,764 ​ $ 20,384 ​ $ 19,864 ​ TTEC Engage ​ 1,468,872 ​ ​ — ​ 1,468,872 ​ 55,984 ​ 81,233 ​ Total ​ $ 1,836,636 ​ $ — ​ $ 1,836,636 ​ $ 76,368 ​ $ 101,097 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Nine Months Ended ​ ​ ​ September 30, ​ September 30, ​ ​ ​ 2024 2023 2024 2023 Capital Expenditures ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ TTEC Digital ​ $ 2,420 $ 1,461 $ 6,498 $ 6,087 ​ TTEC Engage ​ 6,363 ​ 20,307 ​ 29,967 ​ 48,635 ​ Total ​ $ 8,783 $ 21,768 $ 36,465 $ 54,722 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, 2024 December 31, 2023 ​ Total Assets ​ ​ ​ ​ ​ ​ ​ ​ TTEC Digital ​ ​ $ 795,149 $ 815,488 ​ TTEC Engage ​ ​ 1,031,141 ​ 1,370,110 ​ Total ​ ​ $ 1,826,290 $ 2,185,598 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The following table presents revenue based upon the geographic location where the services are provided (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ Nine Months Ended September 30, ​ ​ 2024 2023 2024 2023 ​ Revenue ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ United States / Canada ​ $ 357,650 ​ $ 415,463 $ 1,099,173 ​ $ 1,274,353 ​ Philippines / Asia Pacific / India ​ 96,273 ​ 117,204 ​ 325,467 ​ 354,981 ​ Europe / Middle East / Africa ​ 47,118 ​ 37,095 ​ 128,148 ​ 107,574 ​ Latin America ​ 28,386 ​ 33,194 ​ 87,362 ​ 99,728 ​ Total ​ $ 529,427 $ 602,956 ​ $ 1,640,150 ​ $ 1,836,636 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (4) SIGNIFICANT CLIENTS AND OTHER CONCENTRATIONS The Company had one client that contributed in excess of 10% of total revenue for the nine months ended September 30, 2024; this client operates in the automotive industry and is included in the TTEC Engage segment. This client contributed 11.1 % and 10.1 % of total revenue for the nine months ended September 30, 2024 and 2023, respectively. In addition, the Company has other clients with aggregate revenue exceeding $ 100 million annually and the loss of one or more of these clients could have a material adverse effect on the Company’s business, operating results, or financial condition. To mitigate this risk, the Company’s business arrangements with these larger clients are structured as multiple contracts with different statements of work that are specific to a different line of business or service; these contracts have different durations and renewal dates and could have a revenue opportunity above the $100 million aggregate. In the first quarter of 2024, one of our larger financial services clients notified us that it is exiting one of the lines of business that we support. 12 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) To limit the Company’s credit risk with its clients, management performs periodic credit evaluations, maintains allowances for credit losses and may require pre-payment for services from certain clients whose financial stability or payment practices raise concern. Based on currently available information, management does not believe significant credit risk existed as of September 30, 2024 beyond what was already recognized. Activity in the Company’s Allowance for credit losses consists of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ Nine Months Ended September 30, ​ 2024 2023 2024 2023 Balance, beginning of period ​ $ 4,757 ​ $ 2,347 ​ $ 2,248 ​ $ 3,524 ​ Provision for credit losses ​ 100 ​ ( 27 ) ​ 2,744 ​ ​ 1,677 ​ Uncollectible receivables written-off ​ ( 397 ) ​ 183 ​ ( 553 ) ​ ​ ( 2,702 ) ​ Effect of foreign currency ​ ​ 301 ​ ​ ( 1 ) ​ ​ 322 ​ ​ 3 ​ Balance, end of period ​ $ 4,761 ​ $ 2,502 ​ $ 4,761 ​ $ 2,502 ​ ​ Accounts Receivable Factoring Agreement In the third quarter of 2024, the Company terminated its Uncommitted Receivables Purchase Agreement (“Agreement”) with BMO Bank, N.A. (“Bank”, or “BMO”), under the terms of which the Company had the right to sell, on a revolving basis, U.S. accounts receivables of certain clients at a discount to the Bank for cash on a limited recourse basis. The sales of accounts receivable in accordance with the prior Agreement are reflected as a reduction of Accounts Receivable, net on the Consolidated Balance Sheets. The Company has retained no interest in the sold receivables but retains all collection responsibilities on behalf of the Bank. The discount on the accounts receivable sold is recorded within Other expense, net in the Consolidated Statements of Comprehensive Income (Loss). The cash proceeds from the prior Agreement are included in the change in accounts receivable within the operating activities section of the Consolidated Statements of Cash Flow. The balances related to the Agreement are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, 2024 ​ December 31, 2023 ​ Total accounts receivable factored ​ $ — ​ $ 99,994 ​ ​ ​ ​ ​ ​ ​ ​ ​ Total amounts collected from clients not yet remitted to Bank ​ $ — ​ $ 1,158 ​ ​ The unremitted cash is restricted cash and is included within Prepaid and other current assets with the corresponding liability included in Accrued expenses on the Consolidated Balance Sheet. The Company has not recorded any servicing assets or liabilities as of September 30, 2024 as the fair value of the servicing arrangement as well as the fees earned were not material to the financial statements. ​ (5) GOODWILL ​ Goodwill consisted of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of ​ ​ ​ ​ December 31, ​ Acquisitions / ​ ​ ​ ​ Foreign ​ September 30, ​ ​ 2023 ​ Adjustments ​ Impairments ​ Currency ​ 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ TTEC Digital ​ $ 500,576 ​ $ — ​ $ — ​ $ 479 ​ $ 501,055 ​ TTEC Engage ​ 308,412 ​ — ​ ​ ( 233,532 ) ​ ​ ( 839 ) ​ 74,041 ​ Total ​ $ 808,988 ​ $ — ​ $ ( 233,532 ) ​ $ ( 360 ) ​ $ 575,096 ​ ​ 13 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) The Company performs an annual goodwill impairment assessment on December 1 st , or more frequently, if indicators of impairment exist. The Company also monitors its reporting units for any triggering events and performs qualitative assessments of impairment indicators. During the Company’s annual impairment testing as of December 1, 2023, the Company identified one reporting unit, TTEC Engage, being at risk for future impairment. The carrying value of Engage was $ 1,092.1 million at December 1, 2023, including approximately $ 308.4 million of goodwill. During the first quarter of 2024, the Company concluded there were no triggering events and completed its qualitative assessment of impairment indicators, which included, among other things, an assessment of changes in macroeconomic conditions, comparison of the actual results to those forecasted in the most recent annual impairment test and performing sensitivity analysis on key assumptions. In the second quarter of 2024, the Company identified a triggering event for impairment primarily attributable to the impact of a sustained decline in its market capitalization that was less than the combined carrying value of the Company’s reporting units. As such, the Company performed a quantitative goodwill impairment analysis. The fair value of each reporting unit was estimated using an equal weighting of the income and market valuation approaches. The income approach applied a fair value methodology to each reporting unit based on discounted cash flows. This analysis requires significant judgments, including estimation of future cash flows, which is dependent on internally developed forecasts, estimation of the long-term rate of growth for the Company’s business, estimation of the useful life over which cash flows will occur, and determination of the Company’s weighted average cost of capital, which is risk-adjusted to reflect the specific risk profile of the reporting unit. The weighted average cost of capital used in the Company’s most recent impairment test ranged from 13.8 % to 16.5 %. The Company also applied a market approach, which develops a value correlation based on the market capitalization of similar publicly traded companies, referred to as a multiple, to apply to the operating results of the reporting units. The primary market multiples to which the Company compared are revenue and earnings before interest, taxes, depreciation, and amortization. The resulting fair value of the TTEC Engage reporting unit decreased below its carrying value, which resulted in recording a $ 196 million non-cash pre-tax impairment charge. Recognition of this non-cash goodwill impairment charge resulted in a tax benefit that generated an incremental deferred tax asset of $ 37.5 million to the reporting unit’s carrying value. Accordingly, the Company recorded an additional non-cash charge of $ 37.5 million to reduce the Company’s carrying value to its previously determined fair value in accordance with the applicable goodwill impairment guidance. In total, a non-cash impairment loss of $ 233.5 million was recognized for the second quarter ended June 30, 2024. During the third quarter of 2024, the Company completed its qualitative assessment of impairment indicators, which included, among other things, an assessment of changes in macro-economic conditions, comparison of the actual results to those forecasted in the most recent second quarter of 2024 quantitative impairment test and performing sensitivity analysis on key assumptions. The Company assessed whether any such indicators of impairment existed and concluded there were no triggering events. However, if projected operating results are not met and/or the Company’s market capitalization declines, the Company’s reporting units could be at risk for future impairment. ​ ​ ​ 14 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) (6) DERIVATIVES Cash Flow Hedges The Company enters into foreign exchange related derivatives. Foreign exchange derivatives entered into consist of forward and option contracts to reduce the Company’s exposure to foreign currency exchange rate fluctuations that are associated with forecasted revenue earned in foreign locations. Upon proper qualification, these contracts are designated as cash flow hedges. It is the Company’s policy to only enter into derivative contracts with investment grade counterparty financial institutions, and correspondingly, the fair value of derivative assets considers, among other factors, the creditworthiness of these counterparties. Conversely, the fair value of derivative liabilities reflects the Company’s creditworthiness. As of September 30, 2024, the Company has not experienced, nor does it anticipate, any issues related to derivative counterparty defaults. The following table summarizes the aggregate unrealized net gain or loss in Accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2024 and 2023 (in thousands and net of tax): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Nine Months Ended ​ ​ ​ September 30, ​ September 30, ​ ​ ​ 2024 2023 2024 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Aggregate unrealized net gain/(loss) at beginning of period ​ $ ( 470 ) ​ $ 7,164 ​ $ 6,315 ​ $ 89 ​ Add: Net gain/(loss) from change in fair value of cash flow hedges ​ ​ 3,514 ​ ​ ( 1,786 ) ​ ​ ( 1,801 ) ​ ​ 6,312 ​ Less: Net (gain)/loss reclassified to earnings from effective hedges ​ ​ ( 504 ) ​ ​ ( 989 ) ​ ​ ( 1,974 ) ​ ​ ( 2,012 ) ​ Aggregate unrealized net gain/(loss) at end of period ​ $ 2,540 ​ $ 4,389 ​ $ 2,540 ​ $ 4,389 ​ ​ The Company’s foreign exchange cash flow hedging instruments as of September 30, 2024 and December 31, 2023 are summarized as follows (amounts in thousands). All hedging instruments are forward contracts. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Local ​ ​ ​ ​ ​ ​ ​ ​ Currency ​ U.S. Dollar ​ ​ % Maturing ​ ​ Contracts ​ ​ Notional ​ Notional ​ ​ in the next ​ ​ Maturing As of September 30, 2024 ​ Amount ​ Amount ​ ​ 12 months ​ ​ Through Philippine Peso 7,087,000 ​ 124,228 (1) ​ 62.6 % ​ March 2027 ​ Mexican Peso 680,000 ​ 32,728 ​ ​ 59.3 % ​ December 2026 ​ ​ ​ ​ ​ $ 156,956 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Local ​ ​ ​ ​ ​ ​ ​ ​ ​ Currency ​ U.S. Dollar ​ ​ ​ ​ ​ ​ ​ ​ Notional ​ Notional ​ ​ ​ ​ As of December 31, 2023 ​ Amount ​ Amount ​ ​ ​ ​ ​ ​ Canadian Dollar 2,250 ​ $ 1,670 ​ ​ ​ ​ ​ ​ ​ Philippine Peso 9,324,000 ​ 165,842 (1) ​ ​ ​ ​ ​ ​ Mexican Peso 938,000 ​ 44,155 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 211,667 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Includes contracts to purchase Philippine pesos in exchange for New Zealand dollars and Australian dollars, which are translated into equivalent U.S. dollars on September 30, 2024 and December 31, 2023. ​ 15 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) Fair Value Hedges The Company enters into foreign exchange forward contracts to economically hedge against foreign currency exchange gains and losses on certain receivables and payables of the Company’s foreign operations. Changes in the fair value of derivative instruments designated as fair value hedges are recognized in earnings in Other income (expense), net. As of September 30, 2024 and December 31, 2023 the total notional amounts of the Company’s forward contracts used as fair value hedges were $ 25.3 million and $ 73.3 million, respectively. Derivative Valuation and Settlements The Company’s derivatives as of September 30, 2024 and December 31, 2023 were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, 2024 ​ ​ Designated Not Designated ​ ​ as Hedging as Hedging ​ Designation: ​ Instruments Instruments ​ Foreign Foreign Derivative contract type: ​ Exchange ​ Exchange Derivative classification: ​ Cash Flow ​ Fair Value ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair value and location of derivative in the Consolidated Balance Sheet: ​ ​ ​ ​ ​ ​ ​ Prepaids and other current assets ​ $ 2,703 ​ $ 3 ​ Other long-term assets ​ 757 ​ — ​ Other current liabilities ​ ( 654 ) ​ ( 40 ) ​ Other long-term liabilities ​ ( 430 ) ​ — ​ Total fair value of derivatives, net ​ $ 2,376 ​ $ ( 37 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2023 ​ ​ Designated Not Designated ​ ​ as Hedging as Hedging ​ Designation: ​ Instruments Instruments ​ Foreign Foreign Derivative contract type: ​ Exchange ​ Exchange Derivative classification: ​ Cash Flow ​ Fair Value ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair value and location of derivative in the Consolidated Balance Sheet: ​ ​ ​ ​ ​ ​ ​ Prepaids and other current assets ​ $ 7,527 ​ $ 327 ​ Other long-term assets ​ 2,415 ​ — ​ Other current liabilities ​ ( 1,214 ) ​ ( 120 ) ​ Other long-term liabilities ​ ( 197 ) ​ — ​ Total fair value of derivatives, net ​ $ 8,531 ​ $ 207 ​ ​ 16 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) The effects of derivative instruments on the Consolidated Statements of Comprehensive Income (Loss) for the three months ended September 30, 2024 and 2023 were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ ​ 2024 ​ 2023 ​ ​ Designated as Hedging Designation: ​ Instruments Derivative contract type: ​ Foreign Exchange Derivative classification: Cash Flow ​ ​ ​ ​ ​ ​ ​ ​ ​ Amount of gain or (loss) recognized in Other comprehensive income (loss) - effective portion, net of tax ​ $ 504 ​ $ 989 ​ ​ ​ ​ ​ ​ ​ ​ ​ Amount and location of net gain or (loss) reclassified from Accumulated OCI to income - effective portion: ​ ​ ​ ​ ​ ​ ​ Revenue ​ $ 681 ​ $ 1,336 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ ​ 2024 ​ 2023 Designation: Not Designated as Hedging Instruments ​ Derivative contract type: Foreign Exchange ​ Derivative classification: Fair Value ​ ​ ​ ​ ​ ​ ​ ​ ​ Amount and location of net gain or (loss) recognized in the Consolidated Statement of Comprehensive Income (Loss): ​ ​ ​ ​ ​ ​ ​ Other income (expense), net $ ( 683 ) $ ( 369 ) ​ ​ The effects of derivative instruments on the Consolidated Statements of Comprehensive Income (Loss) for the nine months ended September 30, 2024 and 2023 were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Nine Months Ended September 30, ​ ​ ​ 2024 ​ 2023 ​ ​ ​ Designated as Hedging ​ Designation: ​ Instruments ​ Derivative contract type: ​ Foreign Exchange ​ Derivative classification: Cash Flow ​ ​ ​ ​ ​ ​ ​ ​ ​ Amount of gain or (loss) recognized in Other comprehensive income (loss) - effective portion, net of tax ​ $ 1,974 ​ $ 2,012 ​ ​ ​ ​ ​ ​ ​ ​ ​ Amount and location of net gain or (loss) reclassified from Accumulated OCI to income - effective portion: ​ ​ ​ ​ ​ ​ ​ Revenue ​ $ 2,669 ​ $ 2,719 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Nine Months Ended September 30, ​ ​ ​ 2024 ​ 2023 ​ Designation: Not Designated as Hedging Instruments ​ Derivative contract type: Foreign Exchange ​ Derivative classification: Fair Value ​ ​ ​ ​ ​ ​ ​ ​ ​ Amount and location of net gain or (loss) recognized in the Consolidated Statement of Comprehensive Income (Loss): ​ ​ ​ ​ ​ ​ ​ Other income (expense), net $ ( 1,213 ) $ 1,017 ​ ​ ​ ​ 17 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) ​ ​ (7) FAIR VALUE The authoritative guidance for fair value measurements establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires that the Company maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, similar assets and liabilities in markets that are not active or can be corroborated by observable market data. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The following presents information as of September 30, 2024 and December 31, 2023 for the Company’s assets and liabilities required to be measured at fair value on a recurring basis, as well as the fair value hierarchy used to determine their fair value. Accounts Receivable and Payable - The amounts recorded in the accompanying balance sheets approximate fair value because of their short-term nature. Investments – The Company measures investments, including cost and equity method investments, at fair value on a nonrecurring basis when they are deemed to be other-than-temporarily impaired. The fair values of these investments are determined based on valuation techniques using the best information available, and may include market observable inputs, and discounted cash flow projections. An impairment charge is recorded when the cost of the investment exceeds its fair value and this condition is determined to be other-than-temporary. Debt - The Company’s debt consists primarily of the Company’s Credit Facility, which permits floating-rate borrowings based upon the current Prime Rate or SOFR plus a credit spread as determined by the Company’s leverage ratio calculation (in each case as defined in the Credit Agreement discussed in Note 10). As of September 30, 2024 and December 31, 2023, the Company had $ 1,025.0 million and $ 995.0 million, respectively, of borrowings outstanding under the Credit Facility. During the third quarter of 2024 outstanding borrowings accrued interest at an average rate of 7.8 % per annum, excluding unused commitment fees. The amounts recorded in the accompanying Balance Sheets approximate fair value due to the variable nature of the debt based on Level 2 inputs. Derivatives - Net derivative assets (liabilities) are measured at fair value on a recurring basis. The portfolio is valued using models based on market observable inputs, including both forward and spot foreign exchange rates, interest rates, implied volatility, and counterparty credit risk, including the ability of each party to execute its obligations under the contract. As of September 30, 2024, credit risk did not materially change the fair value of the Company’s derivative contracts. 18 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) The following is a summary of the Company’s fair value measurements for its net derivative assets (liabilities) as of September 30, 2024 and December 31, 2023 (in thousands): As of September 30, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements Using ​ ​ ​ ​ Quoted Prices in Significant ​ ​ ​ ​ ​ Active Markets ​ Other ​ Significant ​ ​ ​ ​ ​ for Identical ​ Observable ​ Unobservable ​ ​ ​ ​ ​ Assets ​ Inputs ​ Inputs ​ ​ ​ ​ ​ (Level 1) ​ (Level 2) ​ (Level 3) ​ At Fair Value Cash flow hedges ​ $ — ​ $ 2,376 ​ $ — ​ $ 2,376 ​ Fair value hedges ​ — ​ ( 37 ) ​ — ​ ( 37 ) ​ Total net derivative asset (liability) ​ $ — ​ $ 2,339 ​ $ — ​ $ 2,339 ​ ​ As of December 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements Using ​ ​ ​ ​ Quoted Prices in Significant ​ ​ ​ ​ ​ Active Markets ​ Other ​ Significant ​ ​ ​ ​ ​ for Identical ​ Observable ​ Unobservable ​ ​ ​ ​ ​ Assets ​ Inputs ​ Inputs ​ ​ ​ ​ ​ (Level 1) ​ (Level 2) ​ (Level 3) ​ At Fair Value Cash flow hedges ​ $ — ​ $ 8,531 ​ $ — ​ $ 8,531 ​ Fair value hedges ​ — ​ 207 ​ — ​ 207 ​ Total net derivative asset (liability) ​ $ — ​ $ 8,738 ​ $ — ​ $ 8,738 ​ ​ The following is a summary of the Company’s fair value measurements as of September 30, 2024 and December 31, 2023 (in thousands): ​ As of September 30, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements Using ​ Quoted Prices in ​ ​ Significant ​ ​ Active Markets for ​ Significant Other ​ Unobservable ​ ​ Identical Assets ​ Observable Inputs ​ Inputs ​ ​ (Level 1) ​ (Level 2) ​ (Level 3) Assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Derivative instruments, net ​ $ — ​ $ 2,339 ​ $ — ​ Deferred compensation plan asset ​ ​ 33,313 ​ ​ — ​ ​ — ​ Total assets ​ $ 33,313 ​ $ 2,339 ​ $ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Derivative instruments, net ​ $ — ​ $ — ​ $ — ​ Contingent consideration ​ — ​ — ​ — ​ Total liabilities ​ $ — ​ $ — ​ $ — ​ ​ 19 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) As of December 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements Using ​ Quoted Prices in ​ ​ Significant ​ ​ Active Markets for ​ Significant Other ​ Unobservable ​ ​ Identical Assets ​ Observable Inputs ​ Inputs ​ ​ (Level 1) ​ (Level 2) ​ (Level 3) Assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Derivative instruments, net ​ $ — ​ $ 8,738 ​ $ — ​ Deferred compensation plan asset ​ ​ 31,082 ​ ​ — ​ ​ — ​ Total assets ​ $ 31,082 ​ $ 8,738 ​ $ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Derivative instruments, net ​ $ — ​ $ — ​ $ — ​ Contingent consideration ​ — ​ — ​ ( 1,496 ) ​ Total liabilities ​ $ — ​ $ — ​ $ ( 1,496 ) ​ ​ Deferred Compensation Plan — The Company maintains a non-qualified deferred compensation plan for certain eligible employees. The deferred compensation asset represents the combined fair value of all the funds based on quoted values and market observable inputs. All amounts deferred under the Plan are unfunded, unsecured obligations of the Company. The Company manages the risk of the changes in the fair value of the liability for deferred compensation by electing to match its liability under the Plan with investment vehicles that offset a portion of its exposure including a Company owned life insurance policy held in a rabbi trust. Contingent Consideration - The Company recorded contingent consideration payable related to the acquisition of Faneuil that closed in 2022. The contingent payables for Faneuil were calculated using a Monte Carlo simulation including a discount rate of 19.3 %. The measurements were based on significant inputs not observable in the market. The Company records interest expense each period using the effective interest method until the future value of these contingent payments reaches the expected total future value. During 2022 and 2023, fair value adjustments of a $ 2.9 million benefit and a $ 3.0 million expense, respectively, were recorded related to fair value adjustments of the estimated contingent payments associated with the Faneuil acquisition based on updated discount factors, the passage of time, updated EBITDA estimates and a modification to the agreement (see Note 2) for one contract, and a complete reduction for the second contract as it was not awarded to the Company. During 2024, a fair value adjustment of a $ 1.5 million benefit was recorded related to fair value adjustments of the estimated contingent payments associated with the Faneuil acquisition based on updated discount factors, the passage of time, and updated EBITDA estimates. The fair value adjustment benefits(expenses) were included in Other income (expense) in the Consolidated Statements of Comprehensive Income (Loss). A rollforward of the activity in the Company’s fair value of the contingent consideration payable is as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Imputed ​ ​ ​ ​ December 31, ​ ​ ​ ​ ​ ​ ​ Interest / ​ September 30, ​ ​ 2023 ​ Acquisitions ​ Payments ​ Adjustments ​ 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Faneuil ​ $ ( 1,496 ) ​ $ — ​ $ — ​ $ 1,496 ​ $ — ​ Total ​ $ ( 1,496 ) ​ $ — ​ $ — ​ $ 1,496 ​ $ — ​ ​ ​ ​ ​ ​ ​ 20 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) (8) IMPAIRMENT OF ASSETS The Company evaluated the recoverability of its leasehold improvement assets at certain customer engagement centers, building and land assets, as well as all internally developed software projects. An asset group is considered to be impaired when the anticipated undiscounted future cash flows of its asset group is estimated to be less than the asset group’s carrying value. The amount of impairment recognized is the difference between the carrying value of the asset group and its fair value. To determine fair value, the Company used Level 3 inputs in its discounted cash flows analysis. Assumptions included the amount and timing of estimated future cash flows and assumed discount rates. During the three and nine months ended September 30, 2024, TTEC Digital recognized impairment losses related to leasehold improvements assets, right of use lease assets, capitalized software and certain computer equipment of $ 0.4 million and $ 2.9 million, respectively. During the three and nine months ended September 30, 2024, TTEC Engage recognized impairment losses related to leasehold improvement assets, right of use lease assets, capitalized software and certain computer equipment of $ 4.3 million and $ 5.1 million, respectively. (9) INCOME TAXES The Company accounts for income taxes in accordance with the accounting literature for income taxes, which requires recognition of deferred tax assets and liabilities for the expected future income tax consequences of transactions that have been included in the Consolidated Financial Statements. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using tax rates in effect for the year in which the differences are expected to reverse. Quarterly, the Company assesses the likelihood that its net deferred tax assets will be recovered. Based on the weight of all available evidence, both positive and negative, the Company records a valuation allowance against deferred tax assets when it is more-likely-than-not that a future tax benefit will not be realized. The Company’s selection of an accounting policy with respect to both the global intangible low taxed foreign income (“GILTI”) and base erosion and anti-abuse tax (“BEAT”) rules is to compute the related taxes in the period the entity becomes subject to either GILTI or BEAT. At the end of each interim period, we are required to estimate our annual effective tax rate for the fiscal year and to use that rate to provide for income taxes for the current year-to-date reporting period. The Company’s 2024 estimated annual effective tax rate of 26.2 %, before discrete items, is driven by the distribution of forecasted income between the U.S. and international tax jurisdictions, earnings in international jurisdictions currently under an income tax holiday, and the impact of valuation allowances in the United States and several other jurisdictions. The Company’s effective tax rate for the nine months ended September 30, 2024 was ( 26.4 )%. This rate was the result of low year-to-date income, the exclusion of losses related to entities with a full valuation allowance and includes a $ 37.5 million benefit related to an impairment charge, and $ 85.8 million of expense related to changes in valuation allowances during the quarter. The Company’s U.S. income tax returns filed for the tax years ending December 31, 2017, December 31, 2018, and December 31, 2020, to present, remain open tax years . The Company has been notified of the intent to audit or is currently under audit of income taxes for the United States for tax year 2017 and 2018 , the Philippines for tax years 2021 to 2023 , the State of Oregon in the United States for tax years 2020 through 2022 , the State of Illinois in the United States for tax year 2020 , the State of Wisconsin in the United States for tax years 2019 through 2021 , Canada for tax year 2021 , and India for tax years 2017 through 2022 . Although the outcome of examinations by taxing authorities are always uncertain, it is the opinion of management that the resolution of these audits will not have a material effect on the Company’s Consolidated Financial Statements. 21 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) The Organization for Economic Co-operation and Development (OECD), supported by 140 of their member countries, have agreed to implement a minimum 15 % tax rate on certain multinational enterprises and have released model guidance. This global minimum tax, known as the Pillar Two framework, became effective across various countries in 2024, as each country works to enact legislation influenced by the OECD Pillar 2 rules. While the Company does not expect the adoption of the Pillar Two framework to have a material impact on its effective tax rate, the Company continues to evaluate additional guidance released by the OECD, along with the pending and adopted legislation in each of the countries in which it operates. When there is a change in judgment concerning the recovery of deferred tax assets in future periods, a valuation allowance is recorded into earnings during the quarter in which the change in judgment occurred. During the first, second and third quarters of 2023, a $ 1.3 million, a $ 3.1 million and a $ 4.4 million valuation allowance were recorded, respectively, for assets that are not expected to be recovered in future periods. Additionally, during the third quarter 2023, a valuation allowance in the amount of $ 1.7 million was released for assets now expected to be recovered in future periods. During the first, second and third quarters of 2024, a $ 3.0 million, $ 81.1 million and a $1.7 million net valuation allowance was recorded, respectively, for assets that are not expected to be recovered in future periods. The Company has been granted “Tax Holidays” as an incentive to attract foreign investment by the governments of the Philippines and Honduras. Generally, a Tax Holiday is an agreement between the Company and a foreign government under which the Company receives certain tax benefits in that country, such as exemption from taxation on profits derived from export-related activities. In the Philippines, the Company has been granted multiple agreements under local laws which result in an overall reduced tax rate. These incentives have varying benefit year over year and expire at various times beginning in 2031. The aggregate benefit to income tax expense for the three months ended September 30, 2024 and 2023 was approximately $ 0.7 million and $ 0.8 million, respectively, which had an impact on diluted net income per share of $ 0.02 and $ 0.02 , respectively. The aggregate benefit to income tax expense for the nine months ended September 30, 2024 and 2023 was approximately $ 2.1 million and $ 1.8 million, respectively, which had an impact on diluted net income per share of $ 0.04 and $ 0.04 , respectively. Since 2017, the Company has been making tax payments to the IRS due to the one-time transition tax on untaxed foreign earnings of foreign subsidiaries, as mandated by the Tax Cuts and Jobs Act. The final payment for this charge will be paid in December of 2024 for a total cash payment of $ 10.4 million this year, resulting in reduction in cash taxes going forward. ​ ​ (10) COMMITMENTS AND CONTINGENCIES Credit Facility On April 3, 2023 , the Company entered into a Seventh Amendment to the Credit Agreement which replaces the use of LIBOR with SOFR as of the date of the amendment, and therefore affects the interest rates paid for a portion of the Credit Facility starting in the second quarter of 2023. On February 26, 2024 , the Company entered into an Eighth Amendment to the Credit Agreement to increase the net leverage ratio covenant, the lenders’ commitment fee rate and margin for a period starting with the quarter ending March 31, 2024 through the quarter ending March 31, 2025, from the current 3.5 to 1 to between 4.0 to 1 and 4.5 to 1, as may be applicable in different quarters; and to reduce the total lenders’ commitment from $1.5 billion to $ 1.3 billion. 22 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) On August 8, 2024, the Company entered into a Ninth Amendment to the Credit Agreement (the “Ninth Amendment”) to, among other things, provide for less restrictive financial covenants in respect of the leverage ratio and the interest coverage ratio for the period beginning with the third quarter of 2024 through the first quarter of 2026 (the “Covenant Adjustment Period”). Specifically, the revisions permit a maximum leverage ratio of up to 5.15 to 1.00 and a minimum interest coverage ratio of not less than 2.00 to 1.00 as of the end the third quarter of 2024, with such levels gradually becoming more restrictive during subsequent quarters of the Covenant Adjustment Period. Pursuant to the Ninth Amendment, the Company agreed to permanently reduce the total lenders’ commitment from $1.3 billion to $ 1.2 billion and to provide certain additional assets as collateral, with the effect that the facility is now secured by substantially all personal property assets of the Company and its subsidiaries. In addition, the Company agreed, to certain other changes, including, among others, (i) increased pricing on borrowings and increased facility fees, in each case, determined according to the Company’s leverage ratio, (ii) more restrictive limitations in respect of debt, liens, investments, acquisitions, asset sales and restricted payments, and (iii) requirements to apply certain equity and debt issuances and asset sale proceeds to the prepayment of the facility and permanent reduction of the total facility commitment amount. The term of the Credit Facility will remain unchanged through November 23, 2026. The maximum commitment under the Credit Facility is $1.2 billion in the aggregate, if certain conditions are satisfied. The Credit Facility commitment fees are payable to the lenders in an amount equal to the unused portion of the Credit Facility multiplied by a rate per annum as determined by reference to the Company’s net leverage ratio. The Credit Agreement contains customary affirmative, negative, and financial covenants. The Credit Agreement also permits the utilization of up to $100 million of limits within the Credit Facility for letters of credit to be used in the business. The Company’s Credit Agreement includes a number of financial covenants and operating restrictions of which failure to comply could result in a default under the Credit Agreement. As of the issuance of these financial statements, the Company believes it has sufficient cash on hand, positive working capital, and availability to access additional cash under the Credit Facility to meet its business operating requirements, its capital expenditures and to continue to comply with the amended debt covenants for the next 12 months. In the event that the Company does not remain in compliance with the financial covenants under the Credit Facility, it may need to negotiate additional amendments to or waivers of the terms of such credit facilities, refinance its debt, or raise additional capital. As defined in the Credit Agreement, base rate loans bear interest at a rate equal to the highest of (a) the prime rate, (b) the federal funds rate plus 0.50 %, and (c) SOFR in effect on such day plus 1.0 %. Base rate loans shall be based on the base rate, plus the applicable credit margin which ranges from 0.375 % to 2.5 % based on the Company’s net leverage ratio. SOFR loans bear interest at a rate equal to the applicable spread adjusted SOFR plus applicable credit margin which ranges from 1.375 % to 3.5 % based on the Company’s net leverage ratio. Alternative currency loans (not denominated in U.S. Dollars) bear interest at rates applicable to their respective currencies. Letter of credit fees are one eighth of 1% of the stated amount of the letter of credit on the date of issuance, renewal or amendment, plus an annual fee equal to the borrowing margin for SOFR loans. As of September 30, 2024 and December 31, 2023, the Company had borrowings of $ 1,025.0 million and $ 995.0 million, respectively, under its Credit Facility, and its average daily utilization was $ 1,047.3 million and $ 1,057.6 million for the nine months ended September 30, 2024 and 2023, respectively. Based on the current level of availability based on the covenant calculations, the Company’s remaining borrowing capacity was approximately $ 140 million as of September 30, 2024. As of September 30, 2024, the Company was in compliance with all covenants and conditions under its Credit Agreement. 23 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) Letters of Credit As of September 30, 2024, outstanding letters of credit under the Credit Facility totaled $ 0.2 million. As of September 30, 2024, letters of credit and contract performance guarantees issued outside of the Credit Agreement totaled $ 0.3 million. Guarantees Indebtedness under the Credit Agreement is guaranteed by the Company’s present and future subsidiaries. Legal Proceedings From time to time, the Company has been involved in legal actions, both as plaintiff and defendant, which arise in the ordinary course of business. The Company accrues for exposures associated with such legal actions to the extent that losses are deemed both probable and reasonably estimable. To the extent specific reserves have not been made for certain legal proceedings, their ultimate outcome, and consequently, an estimate of possible loss, if any, cannot reasonably be determined at this time. Based on currently available information and advice received from counsel, the Company believes that the disposition or ultimate resolution of any current legal proceedings, except as otherwise specifically reserved for in its financial statements, will not have a material adverse effect on the Company’s financial position, cash flows or results of operations. In the event of unexpected further developments, however, it is possible that the ultimate resolution of these matters, or other similar matters, if unfavorable, may be materially adverse to the Company’s financial position, cash flows, or results of operations. ​ (11) DEFERRED REVENUE AND REMAINING PERFORMANCE OBLIGATIONS Revenue recognized for the nine months ended September 30, 2024 from amounts included in deferred revenue as of December 31, 2023 was $ 213.6 million. Revenue recognized for the nine months ended September 30, 2023 from amounts included in deferred revenue as of December 31, 2022 was $ 245.8 million. Remaining performance obligations (“RPO”) represent the amount of contracted future revenue that has not yet been recognized, including both deferred revenue and non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods. The Company’s RPO excludes performance obligations from on-demand arrangements as there are no minimum purchase commitments associated with these arrangements, and certain time and materials contracts that are billed in arrears. As of September 30, 2024, the Company’s RPO was $ 435.2 million, which will be delivered and recognized within the next five years . The Company expects to recognize approximately 63 % of the RPO over the next 12 months , 23 % of the RPO over the subsequent 13 to 24 months, and the remainder thereafter. 24 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) (12) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) ​ The following table presents changes in the accumulated balance for each component of Other comprehensive income (loss), including current period other comprehensive income (loss) and reclassifications out of Accumulated other comprehensive income (loss) (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Foreign ​ ​ ​ ​ ​ ​ ​ ​ Currency ​ Derivative ​ ​ ​ ​ ​ ​ ​ ​ Translation ​ Valuation, Net ​ Other, Net ​ ​ ​ ​ ​ Adjustment ​ of Tax ​ of Tax ​ Totals ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated other comprehensive income (loss) at December 31, 2022 ​ $ ( 123,734 ) $ 89 $ ( 2,656 ) $ ( 126,301 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive income (loss) before reclassifications ​ 18,362 ​ 6,312 ​ 30 ​ 24,704 ​ Amounts reclassified from accumulated other comprehensive income (loss) ​ 301 ​ ( 2,012 ) ​ 269 ​ ( 1,442 ) ​ Net current period other comprehensive income (loss) ​ 18,663 ​ 4,300 ​ 299 ​ 23,262 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated other comprehensive income (loss) at September 30, 2023 ​ $ ( 105,071 ) $ 4,389 $ ( 2,357 ) $ ( 103,039 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated other comprehensive income (loss) at December 31, 2023 ​ $ ( 93,144 ) $ 6,315 $ ( 3,047 ) $ ( 89,876 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive income (loss) before reclassifications ​ ( 6,318 ) ​ ​ ( 1,801 ) ​ ​ 25 ​ ( 8,094 ) ​ Amounts reclassified from accumulated other comprehensive income (loss) ​ — ​ ​ ( 1,974 ) ​ ​ 247 ​ ( 1,727 ) ​ Net current period other comprehensive income (loss) ​ ( 6,318 ) ​ ( 3,775 ) ​ 272 ​ ( 9,821 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated other comprehensive income (loss) at September 30, 2024 ​ $ ( 99,462 ) $ 2,540 $ ( 2,775 ) $ ( 99,697 ) ​ ​ The following table presents the classification and amount of the reclassifications from Accumulated other comprehensive income (loss) to the Statement of Comprehensive Income (Loss) (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Statement of ​ ​ ​ For the Three Months Ended September 30, ​ Comprehensive Income ​ ​ 2024 2023 (Loss) Classification ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Derivative valuation ​ ​ ​ ​ ​ ​ ​ ​ ​ Gain on foreign currency forward exchange contracts ​ $ 681 ​ $ 1,336 Revenue ​ Tax effect ​ ( 177 ) ​ ( 347 ) Provision for income taxes ​ ​ ​ $ 504 ​ $ 989 Net income (loss) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ ​ ​ ​ ​ ​ ​ ​ ​ Actuarial loss on defined benefit plan ​ $ ( 60 ) ​ $ ( 119 ) Cost of services ​ Gain on liquidation ​ ​ — ​ ​ — ​ Other income (expense), net ​ Tax effect ​ 6 ​ 12 Provision for income taxes ​ ​ ​ $ ( 54 ) ​ $ ( 107 ) Net income (loss) ​ ​ 25 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Statement of ​ ​ For the Nine Months Ended September 30, ​ Comprehensive Income ​ 2024 2023 (Loss) Classification ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Derivative valuation ​ ​ ​ ​ ​ ​ ​ ​ ​ Gain on foreign currency forward exchange contracts ​ $ 2,669 ​ $ 2,719 Revenue ​ Tax effect ​ ( 695 ) ​ ( 707 ) Provision for income taxes ​ ​ ​ $ 1,974 ​ $ 2,012 Net income (loss) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ ​ ​ ​ ​ ​ ​ ​ ​ Actuarial loss on defined benefit plan ​ $ ( 291 ) ​ $ ( 299 ) Cost of services ​ Gain on liquidation ​ ​ 19 ​ ​ — ​ Other income (expense), net ​ Tax effect ​ 25 ​ 30 Provision for income taxes ​ ​ ​ $ ( 247 ) ​ $ ( 269 ) Net income (loss) ​ ​ ​ ​ ​ ​ ​ (13) WEIGHTED AVERAGE SHARE COUNTS ​ The following table sets forth the computation of basic and diluted shares for the periods indicated (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ Nine Months Ended September 30, ​ 2024 2023 2024 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ Shares used in basic earnings per share calculation ​ 47,723 47,415 47,573 47,305 Effect of dilutive securities: ​ ​ ​ ​ ​ ​ ​ ​ Restricted stock units ​ 137 73 43 104 Performance-based restricted stock units ​ — — 2 8 Total effects of dilutive securities ​ 137 73 45 112 Shares used in dilutive earnings per share calculation ​ 47,860 47,488 47,618 47,417 ​ For the three months ended September 30, 2024 and 2023, there were 3.0 million and 1.0 million outstanding Restricted Stock Units (“RSUs”), respectively, that were excluded from the computation of diluted net income per share because the effect would have been anti-dilutive. For the nine months ended September 30, 2024 and 2023, there were 2.6 million and 1.0 million outstanding RSUs, respectively, that were excluded from the computation of diluted net income per share because the effect would have been anti-dilutive. ​ ​ (14) EQUITY-BASED COMPENSATION PLANS All equity-based awards to employees are recognized in the Consolidated Statements of Comprehensive Income (Loss) at the fair value of the award on the grant date. The following tables present the total equity-based compensation expense for the three and nine months ended September 30, 2024 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ ​ 2024 ​ 2023 ​ ​ ​ ​ ​ ​ ​ ​ Equity-based compensation expense recognized in Cost of services ​ $ 1,471 ​ $ 3,009 ​ Equity-based compensation expense recognized in Selling, general and administrative ​ ​ 2,862 ​ ​ 3,599 ​ Total equity-based compensation expense ​ $ 4,333 ​ $ 6,608 ​ ​ 26 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Nine Months Ended September 30, ​ ​ 2024 ​ 2023 ​ ​ ​ ​ ​ ​ ​ ​ Equity-based compensation expense recognized in Cost of services ​ $ 5,707 ​ $ 7,407 ​ Equity-based compensation expense recognized in Selling, general and administrative ​ ​ 9,542 ​ ​ 9,003 ​ Total equity-based compensation expense ​ $ 15,249 ​ $ 16,410 ​ ​ Restricted Stock Unit Grants During the nine months ended September 30, 2024 and 2023, the Company granted 250,913 and 587,490 RSUs, respectively, to new and existing employees, which vest over three to five years . The Company recognized compensation expense related to RSUs of $ 4.3 million and $ 15.2 million for the three and nine months ended September 30, 2024, respectively. The Company recognized compensation expense related to RSUs of $ 6.5 million and $ 15.8 million for the three and nine months ended September 30, 2023, respectively. As of September 30, 2024, there was approximately $ 36.9 million of total unrecognized compensation cost (including the impact of expected forfeitures) related to RSUs granted under the Company’s equity plans. Performance Based Restricted Stock Unit Grants During 2021, the Company awarded Performance Restricted Stock Units (“PRSUs”) subject to service and performance vesting conditions. If defined minimum targets were met, the annual value of the PRSUs issued would be between $ 1.2 million and $ 4.9 million and vest in 2024. If the defined minimum targets were not met, then no PRSUs will be issued. The award amounts were based on the Company’s annual revenue and adjusted operating income for fiscal year 2023. The Company recognized compensation expense related to the 2021 PRSUs of $ 0.0 million and $ 0.0 million for the three and nine months ended September 30, 2024, respectively. The Company recognized compensation expense related to the 2021 PRSUs of $ 0.1 million and $ 0.5 million for the three and nine months ended September 30, 2023, respectively. During 2022, the Company made awards of two different PRSU programs that are subject to service and performance vesting conditions: ordinary course annual PRSUs and one-time stretch financial goals PRSUs. For the ordinary course annual PRSUs, if defined minimum targets are met, the annual value of the PRSUs issued will be between $ 0.9 million and $ 3.5 million and vest in March 2025. If the defined minimum targets are not met, then no shares will be issued. The number of shares awarded will be based on the Company’s annual revenue and adjusted EBITDA for fiscal year 2024 . For the one-time stretch financial goals PRSUs, if defined minimum targets at TTEC Engage and TTEC Digital business segments’ levels are met, the Company will issue between 0.0 million and 0.5 million PRSUs that will vest immediately in March 2026. If the defined minimum targets are not met, then no shares will be issued. The number of shares awarded will be based on the TTEC Engage and TTEC Digital business segments’ annual revenue and adjusted EBITDA for fiscal year 2025. For the ordinary course annual PRSUs, no expense was recognized for the nine months ended September 30, 2024. Expense for the one-time stretch financial goals PRSUs will begin at the start of the requisite service period, beginning January 1, 2025. During 2023, the Company awarded PRSUs that are subject to service and performance vesting conditions. If defined minimum targets are met, the Company will issue PRSUs with an annual value between zero and $ 8.9 million that will vest in 2026. If the defined minimum targets are not met, then no PRSUs will be issued. The number of PRSUs awarded will be based on the Company’s annual revenue and adjusted EBITDA for fiscal year 2025. Expense for these awards will begin at the start of the requisite service period, beginning January 1, 2025. 27 Table of Contents TTEC HOLDINGS, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) During the fourth quarter of 2024, the Company awarded PRSUs to senior executives that are subject to service and performance vesting conditions. If defined minimum targets are met, the Company will issue PRSUs with an annual value between zero and $ 5.9 million that vest in 2026. If the defined minimum targets are not met, then no PRSUs will be issued. The number of PRSUs awarded will be based on the Company’s annual revenue and adjusted EBITDA for fiscal year 2026 and on TTEC Digital’s annual revenue and adjusted EBITDA for fiscal year 2026. Expense for these awards will begin at the start of the requisite service period, beginning January 1, 2026. ​ (15) NON-QUALIFIED DEFERRED COMPENSATION PLAN The Company maintains a non-qualified deferred compensation plan for executive officers and other eligible employees that permits such employees to defer a portion of their compensation, on a pretax basis, until after their termination of employment. The plan allows for deferral of up to 75 % of a participant’s base salary, bonus, commissions, and any amounts that U.S. highly compensated employees are limited from contributing into TTEC’s Deferred Tax Retirement Savings Plan (the “401K Plan”). All amounts deferred under the plan are unfunded, unsecured obligations and are recorded within Other long-term liabilities in the accompanying Consolidated Condensed Balance Sheets. In the event of bankruptcy, the assets of this plan are available to satisfy the claims of general creditors. Participants may choose among alternative earnings rates for the amounts they defer, which are primarily based on investment options within the 401K Plan. Amounts contributed and deferred under the Plan are credited or charged with the performance of investment options offered under the plan as elected by the participants. The Company manages the risk of changes in the fair value of the liability for deferred compensation by electing to match its liability under the plan with investment vehicles that offset a portion of its exposure including a Company owned life insurance policy held in a rabbi trust. ​ (16) RELATED PARTY TRANSACTIONS The Company entered into an agreement under which Avion, LLC (“Avion”) and Airmax LLC (“Airmax”) provide certain aviation flight services as requested by the Company. Such services include the use of an aircraft and flight crew. Kenneth D. Tuchman, Chairman and Chief Executive Officer of the Company, has an indirect 100 % beneficial ownership interest in Avion and Airmax. During the nine months ended September 30, 2024 and 2023, the Company expensed $ 0.3 million and $ 0.8 million, respectively, to Avion and Airmax for services provided to the Company. There was $ 36 thousand in payments due and outstanding to Avion and Airmax as of September 30, 2024. Ms. Michelle Swanback, President of the Company, is a member of the board of directors of WTW (NYSE: WTW) (fka “Willis Towers Watson”), that provides compensation consulting and insurance brokerage services to the Company. During the nine months ended September 30, 2024 and 2023, the Company expensed $ 2.3 million and $ 2.8 million, respectively, for these services. ​ ​ ​ 28 Table of Contents CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS ​ This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements regarding our operations, expected financial condition, results of operation, effective tax rate, cash flow, leverage, liquidity, business strategy, competitive position, demand for our services in international operations, acquisition opportunities and impact of acquisitions, capital allocation and dividends, growth opportunities, spending, capital expenditures and investments, competition and market forecasts, industry trends, our human capital resources, and other business matters that are based on our current expectations, assumptions, and projections with respect to the future, and are not a guarantee of performance. In this report when we use words such as “may,” “believe,” “plan,” “will,” “anticipate,” “estimate,” “expect,” “intend,” “project,” “would,” “could,” “target,” or similar expressions, or when we discuss our strategy, plans, goals, initiatives, or objectives, we are making forward-looking statements. Unless otherwise indicated or except where the context otherwise requires, the terms “TTEC,” “the Company,” “we,” “us” and “our” and other similar terms in this report refer to TTEC Holdings, Inc. and its subsidiaries. We caution you not to rely unduly on any forward-looking statements. Actual results may differ materially from those expressed in the forward-looking statements, and you should review and consider carefully the risks, uncertainties and other factors that affect our business and may cause such differences as outlined in Part II. Item 1A Risk Factors of this report and Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2023. Important factors that could cause our actual results to differ materially from those indicated in the forward looking statements include, among others, risks related to our business operations, our strategy and our industry, including risks related to our strategic execution in a competitive market, our ability to innovate and introduce technologies that are sufficiently disruptive to allow us to maintain and grow our market share such as the effective adoption of artificial intelligence into our solutions, revenue risks specific to client concentration in our TTEC Engage business segment and risks related to the product reliability of the technology partners and client transition from on premises to public cloud and SaaS information technology solutions in our TTEC Digital business segment; risks specific to the remote work environment; risks related to the challenges inherent in demand and delivery center capacity forecasting; risks specific to labor costs and retention; risks related to operations controls and employees engaging in fraud; risks related to long sales cycles and lead time to revenue; risks specific to potential geographic and other expansions; risks that may arise in connection with events outside of our control such as macroeconomic conditions; geopolitical tensions, and outbreaks of infectious diseases; risks of M&A activity including our ability to identify, acquire and properly integrate acquired businesses in accordance with our strategy; risks related to our use of technology, including risks that could arise due to disruption to our information technology systems, cybersecurity events and unauthorized data access, our reliance on communication and utility services provided by third parties; risks specific to rapid adoption of AI/GenAI technologies, and the growing reliance on third parties for data, cloud and SaaS services; risks of our financial operations, including ineffective cost-management strategies, our leverage and our debt service obligations; risks specific to financial and operating restrictions built into our credit facility, changes in the cost or availability of labor, telecommunication services, and other operational necessities that we cannot pass on to our clients; risks related to foreign currency exchange, changes in income tax rates and laws, and other laws and regulations relevant to our business; interpretations of transfer pricing arrangements; uncertainties tied to goodwill, assets and strategic investments’ impairments; risks specific to our contracting practices and laws and regulations that impact our business, including uncertainty and inconsistency in privacy and data protection laws, the high cost of compliance with such laws, the high cost and reputational damage of wage and hour class action lawsuits, contract terms that lead to volatility in revenue and profitability, the efforts by clients to transfer contractually cybersecurity, data privacy and emerging technology risks to service providers and our inability to always control or mitigate them; uncertainty in AI/GenAI regulatory environments; risks specific to IP protection and infringement, and our ability to timely secure and maintain licenses needed to support certain regulated lines of business; risks specific to operations outside of the U.S. and in jurisdictions where we have limited experience; risks related to the ownership of our common stock, including risks inherent in our capital structure; our controlling shareholder risk; risks related to the price and trading volumes of our common stock being affected by factors that we cannot fully impact or control; risks 29 Table of Contents inherent in our dividend and stock repurchase policies; risks specific to being a Delaware company and provisions in our charter documents that may discourage, delay or prevent a change in control events potentially depressing the price of our common stock; and the fact that our Chairman and Chief Executive Officer has control over matters requiring shareholder action potentially impacting our stock price and making it less attractive to investors. Our forward-looking statements speak only as of the date that this report is filed with the United States Securities and Exchange Commission (“SEC”). We undertake no obligation to update them, except as may be required by applicable law. You should, however, consult any subsequent disclosures we make in our filings with the SEC on Form 8-K. Although we believe that our forward-looking statements are reasonable, they depend on many factors outside of our control and we can provide no assurance that they will prove to be correct. ​ ​ ​ 30 Table of Contents