Team Inc. Earnings Call: Achievements Amid Challenges

Team Inc. ((TISI)) has held its Q1 earnings call. Read on for the main highlights of the call.

The recent earnings call for Team Inc. painted a picture of cautious optimism, balancing notable achievements with ongoing challenges. The company highlighted significant progress in refinancing, cost savings, and segment-specific revenue growth. However, these positives were tempered by flat overall revenue and continued losses, suggesting a mixed outlook for future performance improvements.

Refinancing and Improved Capital Structure

Team Inc. successfully completed a refinancing transaction in March 2025, which significantly improved its financial flexibility. By lowering the blended interest rate by over 100 basis points and extending term loan maturities to 2030, the company has positioned itself better for future financial stability.

Midstream Revenue Growth

The company’s midstream end markets showed robust performance, with revenue increasing by nearly 15% in the first quarter of 2025. This growth highlights the strength of this segment and its contribution to the company’s overall financial health.

Inspection & Heat Treating Segment Growth

The Inspection & Heat Treating segment delivered impressive top-line growth, with a 6.8% increase in revenue over the previous year. Core U.S. operations saw an 8.8% rise, and adjusted EBITDA improved by 39% year-over-year, showcasing the segment’s strong operational performance.

Cost Discipline and Efficiency Improvements

Team Inc. demonstrated effective cost management by reducing selling, general, and administrative expenses by about $2 million compared to the prior year. The company has also initiated actions targeting $10 million in annualized cost savings, underscoring its commitment to efficiency.

Flat Overall Revenue

Despite the positive developments in specific segments, the company’s overall revenue remained flat year-over-year. Adverse weather conditions in January negatively impacted top-line results, highlighting the challenges of external factors on financial performance.

Mechanical Service Segment Challenges

The Mechanical Service segment faced hurdles with lower callout revenue and delays in project and turnaround activity. These issues shifted revenue into future periods, hindering growth and presenting challenges that the company will need to address moving forward.

Adjusted Net Loss

Team Inc. reported an adjusted net loss of $14.9 million for the first quarter, which was essentially flat compared to the first quarter of 2024. This ongoing loss indicates areas where the company still needs to improve its financial outcomes.

Forward-Looking Guidance

Looking ahead, Team Inc. is focusing on strategic initiatives to drive growth and improve financial performance. The company aims for at least a 15% year-over-year growth in adjusted EBITDA and is progressing towards a 10% adjusted EBITDA margin. With a targeted $10 million in annualized cost savings and improved financial flexibility from refinancing, the company is setting a foundation for future success.

In summary, Team Inc.’s earnings call reflected a balance of achievements and challenges. While the company made strides in refinancing and segment growth, it faced flat overall revenue and ongoing losses. The forward-looking guidance suggests a strategic focus on growth and efficiency, offering a cautiously optimistic outlook for the future.