Gee Group (JOB), a staffing and workforce solutions provider, released its fiscal third quarter results on August 13, 2025. The company reported consolidated revenue of $24.5 million (GAAP), down 9% compared to the same period in fiscal 2024, in line with the previous trend but with no Wall Street consensus available for comparison. Operating losses narrowed compared to a year earlier. While gross profit and margins (GAAP) improved slightly, Persistent negative free cash flow (non-GAAP) for 9M FY2025 and revenue contraction signaled that market conditions for Gee Group remain challenging.
| Metric | Q3 2025 | Q3 2024 | Y/Y Change |
|---|---|---|---|
| Revenue | $24.5 million | $27.0 million | (9.3%) |
| Gross Profit | $8.7 million | $9.2 million | -5.4 % |
| Loss from Continuing Operations | $(0.4 million) | $(18.1 million) | N/A |
| EPS | $(0.00) | $(0.18) | $(0.00) to $(0.18) |
| Adjusted EBITDA (Non-GAAP) | $(25 thousand) | $(329 thousand) | N/A |
Company Overview and Strategic Focus
Gee Group operates as a staffing and workforce solutions company, providing contract and direct hire placement services across sectors such as IT, healthcare, engineering, and finance. Its offerings target both small businesses and large-scale enterprises, including Fortune 1000 companies, through a portfolio of brands like Access Data Consulting, Agile Resources, and SNI.
The business has recently focused on strategic acquisitions, technological integration, and operational efficiency. By divesting lower-margin industrial assets and acquiring firms like Hornet Staffing, Gee Group seeks to emphasize professional staffing and expansion into higher-value client relationships. Success for the company depends on its ability to diversify revenue streams, maintain strong client relationships, and compete by leveraging technology, particularly artificial intelligence (AI), to improve sales and recruitment processes.
Quarter Highlights: Revenue, Margins, and Key Events
Revenue (GAAP) fell to $24.5 million, reflecting a 9% year-over-year decline in consolidated revenues (GAAP). Professional contract staffing services, which accounted for approximately 87% of revenue, dropped 10% year over year. Gee Group attributed this to fewer job orders and subdued client demand, as ongoing macroeconomic and labor market uncertainty continued to impact staffing across the industry. Direct hire placement services saw minimal change, remaining close to flat at just over $3.2 million (GAAP).
Despite the revenue contraction, gross margin (GAAP) improved from 34.1% in Q3 FY2024 to 35.4%, supported by a higher mix of direct hire placements, which carry stronger profitability and nearly 100% gross margin for the company (GAAP). Gross profit (GAAP) fell slightly, tracking the revenue decrease, while lower selling, general, and administrative (SG&A) expenses helped offset some top-line weakness. SG&A was $9.0 million, down 8% from the prior year, a result of targeted cost reductions and productivity initiatives.
On the profitability front, the loss from continuing operations (GAAP) narrowed significantly to $0.4 million from $18.1 million compared to Q3 FY2024. However, last year's loss included over $19 million in impairment charges related to the revaluation of goodwill and intangible assets during 9M FY2024 (GAAP). When excluding these one-time items, ongoing operational losses (non-GAAP adjusted EBITDA) remained modest and similar to recent quarters in Q3 and 9M FY2025. Adjusted EBITDA (non-GAAP) improved but remained mildly negative at $(25) thousand.
The company completed its divestiture of the lower-margin Industrial Staffing segment this quarter. Additionally, the acquisition of Hornet Staffing, a firm specializing in information technology and customer service workforce solutions, closed in January 2025. Hornet brings expertise with managed service providers (MSPs), vendor management systems (VMS), and offshore recruiting, all aimed at enhancing Gee Group’s competitiveness and ability to support large enterprise clients.
Management highlighted the implementation and incorporation of AI in its sales and recruiting processes during the period. By leveraging technology and offshore talent, Gee Group expects to further streamline its operations and offer higher-value services such as human resources consulting, statement of work (SOW) project management, and recruitment process outsourcing (RPO). The company does not currently pay a dividend.
Financial Position and Forward Look
The balance sheet remains a relative strength. Gee Group closed the quarter with $18.6 million in cash, no long-term debt, and $6.6 million of committed but undrawn bank credit. The current ratio, a measure of short-term liquidity, stood at 4.2. However, persistent negative free cash flow—$(1.9) million (non-GAAP) for 9M FY2025—and a reduction in shareholders’ equity due to prior impairment charges highlight ongoing risks should revenue softness continue.
Looking ahead, management provided no formal or quantitative guidance for the remainder of fiscal 2025. Leadership described an outlook for a "somewhat volatile but gradually improving" demand environment, with continued focus on gaining market share, maintaining cost controls, and integrating the Hornet acquisition. No explicit targets for revenue or profitability were shared. JOB does not currently pay a dividend.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
