Kforce Inc. reported a decline in financial performance for the first quarter of 2025, with total revenue decreasing by 6.2% to $330.0 million compared to $351.9 million in the same period of 2024. The decrease was attributed to a 4.9% drop in revenue from the Technology segment and a 20.3% decline from the Finance and Accounting (FA) segment, primarily driven by ongoing macroeconomic uncertainties. Gross profit also fell, amounting to $88.3 million, down from $95.3 million a year earlier, resulting in a gross profit margin of 26.7%, a decrease of 40 basis points from the previous year.
In terms of profitability, Kforce's net income for the quarter was $8.1 million, or $0.45 per share, reflecting a 25.9% decrease from the $11.0 million, or $0.58 per share, reported in the first quarter of 2024. Selling, general, and administrative (SG&A) expenses as a percentage of revenue increased to 22.8% from 22.2% in the prior year, indicating a rise in operational costs relative to revenue. The company returned $28.3 million to shareholders through stock repurchases and dividends during the quarter.
Kforce's operational metrics showed a decrease in the number of consultants on assignment, which contributed to the decline in Flex revenue, down 6.4% year-over-year to $322.6 million. The Technology segment's Flex revenue decreased by 5.0%, while the FA segment experienced a more significant drop of 23.2%. However, Direct Hire revenue increased by 4.1% to $7.5 million, indicating some resilience in this area. As of March 31, 2025, Kforce employed approximately 1,700 associates and had around 7,500 consultants on assignment.
The company is currently focused on strategic initiatives, including the implementation of Workday as part of its back-office transformation, expected to go live in early 2026. Kforce anticipates that these investments will position the firm to capture increased market share when demand improves. Despite the current challenges, management remains optimistic about future growth, although they acknowledge that macroeconomic uncertainties may continue to impact client investment decisions. The firm expects Flex revenue to improve slightly in the second quarter of 2025, while also preparing for potential fluctuations in the market.
About KFORCE INC
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