Revenue and profitability overview
- Revenue: $136.935 million for QQ1 2025, down 19% year over year and down 7.6% quarter over quarter on a same‑day basis. The decline reflects softer demand in operational accounting/On‑Demand talent and a softer top line prior to service mix normalization.
- Gross Margin: 36.5% for the quarter, down from the prior year. The margin contraction was driven by lower utilization of salary consultants and less favorable leverage on indirect costs in a softer top‑line environment. Enterprise‑wide average bill rate was $119 in CC terms, down from $125 a year ago, with Asia Pacific volume and pricing depressing the blended rate.
- EBITDA: -$2.63 million, corresponding to an EBITDA margin of about -1.9%, indicating ongoing fixed cost leverage challenges in a slower demand environment.
- Operating Income: -$4.80 million, or about -3.5% of revenue, reflecting the gross margin pressure and ongoing SG&A investments tied to the go‑to‑market evolution and brand refresh.
- Net Income / EPS: -$5.71 million and -$0.17 per share (diluted), reflecting operating losses and a modest tax impact in the quarter.
- SG&A: Run rate SG&A of $47.7 million, a 14% improvement YoY driven by fixed‑cost reductions; however, ongoing investments related to the new operating model and brand refresh contribute to near‑term profitability headwinds.
- Cash and liquidity: Cash and cash equivalents of $89.6 million with zero debt; net cash position and minority cash expenditures related to acquisitions (Reference Point) totaling roughly $23 million for the period. Free cash flow (TTM) was $23 million.
- Balance sheet strength: Total assets of $512.9 million, total liabilities of $105.7 million, and total stockholders’ equity of $407.2 million, with goodwill and intangibles of $243.8 million and a cash conversion profile suggesting ample liquidity to fund tech transformation and buybacks.
- Segment mix and impairment: QQ1 segment revenue includes On‑Demand Talent ($52.5m, down 33% YoY), Consulting ($55.0m, down 3%), Outsourced Services ($9.5m, up 1%), and Europe/APAC ($18.0m, down 21% YoY). A $3.9 million non‑cash goodwill impairment was recorded in the Europe/APAC segment due to segment re‑allocation and impairment testing under the new operating structure.