HireQuest Reports 12% Revenue Decline in Q2 2025, Net Income Falls to $1.06 Million

HireQuest, Inc. reported a decline in financial performance for the second quarter of 2025, with total revenue of approximately $7.6 million, down 12% from $8.7 million in the same period last year. The decrease was attributed to a significant drop in system-wide sales, which fell by 13.9% to $125.9 million, primarily driven by declines in the MRI, HQ Direct, and Snelling segments. Franchise royalties also decreased by 11.2% to $7.3 million, reflecting a net effective royalty rate of 5.8%, slightly up from 5.6% in the prior year. The company reported a net income of $1.06 million, down from $2.04 million in the previous year, resulting in basic earnings per share of $0.08 compared to $0.15.

For the six months ended June 30, 2025, HireQuest's total revenue was approximately $15.1 million, a decrease of 11.6% from $17.1 million in the same period of 2024. The decline in revenue was accompanied by a similar drop in system-wide sales, which fell by 12.8% to $244.3 million. Franchise royalties for the first half of 2025 were approximately $14.2 million, down from $16 million in the prior year. The company’s net income for the six-month period was $2.42 million, compared to $3.66 million in 2024.

Strategically, HireQuest completed the acquisition of Ready Temporary Staffing, LLC in December 2024 for $1.4 million, which expanded its presence in Colorado. The company continues to operate with 413 franchisee-owned offices and one company-owned office across 43 states and 13 countries. The total employee count remains approximately 65,000 annually, providing staffing solutions across various sectors, including construction and healthcare. The company is focused on both organic growth and strategic acquisitions to enhance its market position.

Operationally, HireQuest's selling, general, and administrative expenses increased to $5.9 million in the second quarter of 2025, up from $5.3 million in the previous year, primarily due to transaction-related expenses. The company reported a decrease in workers' compensation expenses, which fell to $127,000 from $547,000 year-over-year. The company’s cash position improved, with cash at the end of the period totaling $2.68 million, up from $2.22 million at the end of 2024.

Looking ahead, HireQuest anticipates that its current cash balance, along with future cash generated from operations and available borrowing capacity, will be sufficient to meet its working capital needs and other liquidity requirements for the next 12 months. However, the company acknowledges potential challenges posed by economic conditions, including inflation and market uncertainties, which could impact demand for its staffing services.