Kforce Inc. Reports Revenue Decline in Q3 and Year-to-Date for 2025

Kforce Inc. reported a decline in financial performance for the third quarter and the first nine months of 2025, with total revenue reaching $332.6 million for the quarter and $997.0 million year-to-date, representing decreases of 5.9% and 6.1%, respectively, compared to the same periods in 2024. The company's net income for the nine months ended September 30, 2025, was $29.7 million, or $1.66 per diluted share, down 24.6% from $39.4 million, or $2.08 per diluted share, in the prior year. The decrease in revenue and profitability was attributed primarily to a reduction in the number of consultants on assignment, which Kforce believes is linked to ongoing macroeconomic uncertainties.

In terms of operational metrics, Kforce employed over 1,600 associates and had approximately 7,500 consultants on assignment as of September 30, 2025. The company experienced a notable decline in Flex revenue, which fell 6.0% year-to-date, driven by a 5.2% decrease in the Technology segment and a 16.0% drop in the Finance and Accounting (FA) segment. Despite these challenges, Kforce reported a sequential improvement in FA Flex revenue in the third quarter, which increased nearly 7% on a billing day basis, indicating a potential recovery in demand.

Kforce's strategic initiatives included a focus on retaining productive associates and investing in technology solutions, particularly in response to the evolving landscape shaped by advancements in artificial intelligence. The company also continued its stock repurchase program, buying back approximately 950,000 shares for $41.1 million during the nine months ended September 30, 2025. The Board of Directors approved an increase in the stock repurchase authorization to $100 million, reflecting Kforce's commitment to returning capital to shareholders.

The company's selling, general, and administrative (SG&A) expenses as a percentage of revenue increased to 22.6% for the nine months ended September 30, 2025, compared to 22.1% in the prior year, primarily due to declining revenue and gross profit. Kforce's gross profit margin also decreased to 27.2% from 27.6% year-over-year, influenced by a shift in the mix of Direct Hire revenue and higher healthcare costs. The firm reported cash provided by operating activities of $41.9 million for the nine months, down from $65.1 million in the previous year, reflecting lower profitability levels and increased capitalized costs.

Looking ahead, Kforce anticipates that the macroeconomic environment will continue to influence client investment decisions, particularly in technology. The company remains optimistic about the backlog of strategic technology investments that clients are expected to execute once confidence in the economic landscape improves. Kforce's management is focused on aligning costs with revenue levels and maintaining operational flexibility to navigate the current demand-constrained environment.