Resources Connection, Inc. announced its financial results for the second quarter of fiscal 2025, reporting revenue of $145.6 million. This represents a 10.7% decline compared to $163.1 million in the prior year quarter, but a 6.3% sequential growth from the first quarter of fiscal 2025.
The company reported a net loss of $68.7 million, or -$2.08 per diluted share, primarily due to a non-cash goodwill impairment charge. This contrasts with a net income of $4.9 million, or $0.14 per diluted share, in the second quarter of fiscal 2024.
A significant non-cash goodwill impairment charge of $79.5 million was recorded, with $57.8 million impacting the On-Demand Talent segment and $21.7 million affecting the Europe and Asia Pacific segment. Gross margin for the quarter was 38.5%, a slight decrease from 38.9% in the prior year quarter.
Selling, General and Administrative (SG&A) expenses decreased to $51.3 million from $53.0 million in the prior year quarter, driven by a $2.0 million decrease in employee termination benefits from the 2023 U.S. Restructuring Plan. The Consulting segment saw revenue increase by 2.7% to $60.6 million, including $4.8 million from the Reference Point acquisition, while On-Demand Talent revenue declined by 24.7% to $53.5 million.
Management noted that the company exceeded expectations for the quarter, delivering sequential revenue growth and significantly improving gross margin and Adjusted EBITDA results over the first quarter. The Board also authorized additional share repurchases, signaling confidence in the company's strategic vision.
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