On November 1, 2023, Mastech Digital Inc (MHH, Financial), a leading provider of Digital Transformation IT Services, announced its financial results for the third quarter ended September 30, 2023. The company reported a 24% year-over-year revenue decline, with revenues totaling $47.8 million compared to $63.1 million during the corresponding quarter of 2022.
Financial Performance
Gross profits in the third quarter of 2023 were $12.6 million, compared to $16.3 million in the same quarter of 2022. GAAP net income for the third quarter of 2023 totaled $125,000 or $0.01 per diluted share, compared to $2.4 million net income, or $0.20 per diluted share, during the same period of 2022. Non-GAAP net income for the third quarter of 2023 was $1.3 million, or $0.11 per diluted share, compared to $4.0 million, or $0.33 per diluted share, in the third quarter of 2022.
Business Segment Performance
While activity levels at the Company’s Data and Analytics Services segment remained elevated in the third quarter of 2023, project award delays resulted in a disappointing bookings performance. Continued spending reductions on several existing projects, coupled with the lower bookings, resulted in a sequential decline in revenues. Demand for the Company’s IT Staffing Services segment, which is largely linked to U.S. economic conditions, also declined during the quarter, as clients continue to respond to uncertainties in the domestic economy.
Executive Commentary
Vivek Gupta, the Company’s President and Chief Executive Officer, stated: “The prevalent uncertain economic conditions have continued to impact clients’ spending dynamics during the third quarter of 2023. As a result, both of our business segments experienced revenue declines during this period. We are continuing to aggressively pursue measures to reduce our operating cost structure as a mitigating action. We believe that our businesses remain fundamentally sound, and that our balance sheet and liquidity position continue to be solid.”
Financial Position
As of September 30, 2023, the company had $15.9 million of cash balances on hand, no bank debt, and borrowing availability of approximately $25 million under its revolving credit facility. The Days Sales Outstanding (DSO) measurement improved by one day during the quarter to 55 days on September 30, 2023.
About Mastech Digital Inc
Mastech Digital (NYSE American: MHH) is a leading provider of Digital Transformation IT Services. The Company offers Data Management and Analytics Solutions, Digital Learning, and IT Staffing Services with a Digital First approach. A minority-owned enterprise, Mastech Digital is headquartered in Pittsburgh, PA, with offices across the U.S., Canada, Europe, and India.
Explore the complete 8-K earnings release (here) from Mastech Digital Inc for further details.
