Active infrared thermography is a non-destructive testing (NDT) technique used for non-contact inspection of components and materials by temporal mapping of thermal patterns by means of infrared imaging. Through the application of a short heat pulse, thermal waves of various amplitudes and frequencies are launched into the specimen allowing a signal analysis based on amplitude and phase information (pulsed phase thermography PPT). The wavelet transform (with complex wavelets) can be used with PPT data in a similar way as the classical Fourier transform however with the advantage of preserving time information of the signal which can then be correlated to defect depth, and in this way allowing a quantitative evaluation. In this paper we review the methodology of PPT and the associated signal analysis (Fourier analysis, wavelet analysis) to obtain quantitative defect depth information. We compare and discuss the results of thermal FEM simulations with experimental data and show the advantages of wavelet based signal analysis for defect depth measurements and material characterization.