HireQuest Inc (NASDAQ:HQI) reported its second-quarter 2025 financial results, delivering mixed performance relative to analyst expectations. The staffing franchisor posted revenue of $7.6 million, down 12% year-over-year and slightly below the consensus estimate of $7.74 million. Adjusted earnings per share (EPS) came in at $0.15, surpassing the $0.12 forecast by analysts.
Key Financial Highlights vs. Estimates
- Revenue: $7.64M (vs. $7.74M expected) – Miss
- Adjusted EPS: $0.15 (vs. $0.12 expected) – Beat
- Net Income: $1.1M (down from $2.0M in Q2 2024)
- Adjusted EBITDA: $3.3M (vs. $4.0M in prior-year quarter)
The revenue decline was attributed to continued softness in the staffing market, with system-wide sales dropping 13.9% year-over-year to $125.9 million. However, cost controls and lower workers' compensation expenses helped mitigate the impact on profitability.
Market Reaction
Following the earnings release, HireQuest’s stock showed muted after-hours movement, with no significant price change. Over the past month, shares have declined approximately 6%, reflecting broader concerns about the staffing sector’s sluggish demand. The lack of a strong post-earnings rebound suggests investors remain cautious despite the earnings beat.
Operational and Strategic Developments
CEO Rick Hermanns emphasized the company’s focus on expense management and mergers & acquisitions (M&A) to expand its geographic footprint. Notably:
- SG&A expenses rose 10.8% due to $929,000 in transaction costs related to M&A activity.
- Cash position improved to $2.7M (up from $2.2M at year-end 2024).
- Dividend maintained at $0.06 per share, signaling confidence in liquidity.
Outlook vs. Analyst Expectations
While management did not provide explicit forward guidance, analysts currently estimate:
- Q3 2025 Revenue: $8.29M
- Full-Year 2025 Revenue: $31.38M
- Full-Year 2025 EPS: $0.50
Given the ongoing market challenges, HireQuest’s ability to maintain profitability through cost discipline and strategic acquisitions will be critical in meeting these projections.
Conclusion
HireQuest’s Q2 performance reflects resilience in a tough staffing environment, with earnings outperforming expectations despite a revenue miss. The market’s subdued reaction indicates lingering skepticism about near-term demand recovery.
For more detailed earnings estimates and historical performance, visit HireQuest’s earnings page.
Disclaimer: This article is not investment advice. Investors should conduct their own research before making decisions.
