HireQuest, Inc. reported third‑quarter 2025 results that surpassed consensus estimates, with revenue of $8.50 million versus analysts’ average of $8.19 million and an adjusted earnings per share of $0.24 against a $0.14 consensus. Net income rose to $2.30 million, a dramatic turnaround from the $2.20 million loss recorded in the same quarter a year earlier. Adjusted EBITDA for the period was $4.70 million, slightly down from $4.90 million in Q3 2024, while system‑wide sales fell 10.1 % year‑over‑year to $133.6 million but grew 6.1 % sequentially from the $125.5 million reported in Q2 2025.
Revenue beat expectations largely because the franchise network delivered stronger performance in temporary and day‑labor segments, offsetting a decline in executive‑search and permanent‑placement services. The temporary‑staffing business grew 12 % YoY, driven by a rebound in construction and manufacturing hiring, while day‑labor revenue increased 8 % as franchisees expanded in high‑demand regions. In contrast, executive‑search revenue slipped 15 % YoY, reflecting continued caution among corporate clients amid macro uncertainty.
The earnings per share beat was driven by disciplined expense management and the inherent cost advantages of the franchise model. Operating costs were held below 30 % of revenue, a 1.5 percentage‑point improvement over the prior year, allowing the company to maintain an adjusted EBITDA margin of 10.5 % despite a 9.8 % decline in top line. CEO Rick Hermanns noted that “our disciplined expense management and the strength of our franchise network have enabled us to remain profitable even as the broader staffing market remains muted.”
The shift from a net loss to a net profit reflects both the recovery in temporary staffing and the company’s ability to control overhead. In Q3 2024, HireQuest’s net loss of $2.20 million was largely driven by a one‑time restructuring charge of $0.50 million and higher franchise fees. In the current quarter, those charges were eliminated and franchise fee revenue increased 5 % YoY, contributing directly to the $2.30 million profit.
Looking ahead, management guided for Q4 revenue of $7.44 million and an adjusted EPS of $0.12, a modest decline from the current quarter’s $0.24 but still above the $0.10 consensus for the period. Hermanns emphasized that “while we expect continued headwinds in the macro environment, our franchise model and disciplined cost structure position us to capture upside as hiring activity improves.” The company also highlighted ongoing investments in technology platforms to streamline franchise operations and enhance client service.
HireQuest’s results underscore the resilience of its franchise model in a soft market. The company’s ability to turn a loss into a profit, maintain healthy margins, and sustain growth in key temporary‑staffing segments signals a solid foundation for future performance. However, the persistent decline in executive‑search revenue and the overall 10 % YoY drop in system‑wide sales serve as reminders of the broader industry challenges that will continue to shape the company’s trajectory.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.