Kforce Reports First Quarter 2026 Revenue of $330.4 Million; Returns to Year-over-Year Growth

Kforce Reports First Quarter 2026 Revenue of $330.4 Million; Returns to Year-over-Year Growth TAMPA, Fla.--( BUSINESS WIRE)--Kforce Inc. (NYSE: KFRC), a solutions firm that specializes in technology and other professional staffing services, today announced results for the first quarter of 2026.

Joseph J. Liberatore, President and Chief Executive Officer, said, "We are extremely pleased to have successfully driven results in the first quarter that again exceeded our expectations from both a revenue and profitability perspective. The momentum that we carried into the beginning of the year has continued to increase, resulting in year-over-year revenue growth for the first time in several years. We are encouraged that our revenue trajectory has continued to improve in the first month of the second quarter, which we expect will lead to year-over-year growth in the second quarter of 2026 in the mid-single digits. I could not be prouder of the tenacity of our people or more appreciative of the trust that our world class clients are increasingly placing in Kforce to drive more meaningful and valuable engagements with them. Our go-to-market approach, which was born out of our integrated strategy efforts, appears to be paying dividends. Our people continue to operate more fully as One Kforce leveraging the Firm’s capabilities across all service offerings."

Quarterly Financial Highlights

Second Quarter 2026 - Guidance

Looking forward to the second quarter of 2026, there will be 64 billing days, compared to 63 billing days in the first quarter of 2026 and 64 billing days in the second quarter of 2025. Current estimates for the second quarter of 2026 are:

Conference Call

On Monday, April 27, 2026, Kforce will host a conference call at 5:00 p.m. E.T. to discuss these results. The dial-in number is (800) 715-9871 and the conference passcode is "Kforce." The prepared remarks for this call and webcast are available on the Investor Relations page of the Kforce Inc. website in the News and Events section. The replay of the call can be accessed at http://investor.kforce.com.

About Kforce Inc.

Kforce Inc. (the “Firm”) is a solutions firm specializing in technology, finance and accounting, and other professional staffing services. Our KNOWLEDGEforce ® empowers industry-leading companies to achieve their digital transformation goals. We curate teams of technical experts who deliver solutions custom-tailored to each client’s needs. These scalable, flexible outcomes are shaped by deep market knowledge, thought leadership and our multi-industry expertise.

Our integrated approach is rooted in 60 years of proven success deploying highly skilled professionals on a temporary and direct-hire basis. Each year, approximately 17,000 talented experts work with Fortune 500 and other leading companies. Together, we deliver Great Results Through Strategic Partnership and Knowledge Sharing ®.

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

All statements in this press release, other than those of a historical nature, are forward-looking statements including, but not limited to, statements regarding our expectations for year-over-year growth in the second quarter of 2026, and the Firm's guidance for the second quarter of 2026. Such forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Factors that could cause actual results to differ materially include the following: general business conditions; global trade policy, federal administration actions, government shutdowns, other geopolitical events and their potential impacts on our operations and the broader economy; growth rates in temporary staffing and the general economy; competitive factors; risks due to shifts in the market demand, including those resulting from the growth of artificial intelligence (AI); changes in demand, or our ability to adapt to such changes; a constraint in the supply of consultants and candidates, or the Firm’s ability to attract and retain such individuals; the success of the Firm in attracting and retaining its management team and key operating employees; changes in business or service mix; the ability of the Firm to repurchase shares and issue dividends; the occurrence of unanticipated expenses, income, gains or losses; the effect of adverse weather conditions; changes in our effective tax rate; our ability to comply with or respond to government regulations, laws, orders, guidelines and policies that impact our business; risk of contract performance, delays, termination or the failure to obtain new assignments, contracts, or funding under contracts; ability to comply with our obligations in a remote work environment, including consultants engaging in unauthorized or fraudulent activity; continued performance, security of, and improvements to, our enterprise information systems; and impacts of actual or potential litigation, or other legal or regulatory matters or liabilities, including the risk factors and matters listed from time to time in the Firm’s reports filed with the Securities and Exchange Commission, including, but not limited to, the Firm’s Form 10-K for the fiscal year ended December 31, 2025, as well as assumptions regarding the foregoing. The terms “should,” “believe,” “estimate,” “expect,” “intend,” “anticipate,” “plan”, "appear" and similar expressions and variations thereof contained in this press release identify certain of such forward-looking statements, which speak only as of the date of this press release. As a result, such forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Future events and actual results may differ materially from those indicated in the forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements and the Firm undertakes no obligation to update any forward-looking statements.

Kforce Inc.

Summary of Operations

(In Thousands, Except Per Share Amounts)

(Unaudited)

Three Months Ended

March 31, 2026

December 31, 2025

March 31, 2025

Revenue

330,364

332,018

330,028

Direct costs

240,296

241,810

241,768

Gross profit

90,068

90,208

88,260

Selling, general and administrative expenses

76,758

80,329

75,165

Depreciation and amortization

1,304

1,323

1,464

Income from operations

12,006

8,556

11,631

Other expense, net

652

780

565

Income before income taxes

11,354

7,776

11,066

Income tax expense

3,429

2,613

2,921

Net income

7,925

5,163

8,145

Earnings per share – diluted

0.46

0.30

0.45

Weighted average shares outstanding – diluted

17,197

17,409

18,241

Adjusted EBITDA

16,897

16,748

16,751

Billing days

Kforce Inc.

Consolidated Balance Sheets

(In Thousands)

(Unaudited)

March 31, 2026

December 31, 2025

ASSETS

Current assets:

Cash and cash equivalents

1,338

2,142

Trade receivables, net of allowances

207,275

190,461

Prepaid expenses and other current assets

8,792

9,669

Total current assets

217,405

202,272

Fixed assets, net

5,530

6,023

Other assets, net

134,171

129,267

Deferred tax assets, net

2,624

3,036

Goodwill

25,040

Total assets

384,770

365,638

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable and other accrued liabilities

69,215

67,609

Accrued payroll costs

46,948

42,328

Current portion of operating lease liabilities

3,414

3,342

Income taxes payable

1,988

451

Total current liabilities

121,565

113,730

Long-term debt – credit facility

91,500

66,400

Other long-term liabilities

54,350

60,905

Total liabilities

267,415

241,035

Commitments and contingencies

Stockholders’ equity:

Common stock

743

742

Additional paid-in capital

562,323

558,297

Retained earnings

552,828

552,180

Treasury stock, at cost

(998,539

)

(986,616

)

Total stockholders’ equity

117,355

124,603

Total liabilities and stockholders’ equity

384,770

365,638

Kforce Inc.

Key Statistics

(Unaudited)

Q1 2026

Q4 2025

Q1 2025

Total Firm

Total Revenue (000’s)

330,364

332,018

330,028

GP %

27.3

27.2

26.7

Flex revenue (000’s)

324,228

326,093

322,570

Hours (000's)

3,772

3,810

3,726

Flex GP %

25.9

25.8

25.0

Direct Hire revenue (000’s)

6,136

5,925

7,458

Placements

276

252

342

Average fee

22,270

23,529

21,830

Billing days

Technology

Total Revenue (000’s)

305,963

306,315

306,284

GP %

26.5

26.3

25.9

Flex revenue (000’s)

302,955

303,566

302,435

Hours (000’s)

3,365

3,383

3,337

Flex GP %

25.7

24.9

Direct Hire revenue (000’s)

3,008

2,749

3,849

Placements

139

123

172

Average fee

21,659

22,339

22,324

Finance and Accounting

Total Revenue (000’s)

24,401

25,703

23,744

GP %

37.1

37.2

38.2

Flex revenue (000’s)

21,273

22,527

20,135

Hours (000’s)

407

427

389

Flex GP %

27.9

28.3

27.2

Direct Hire revenue (000’s)

3,128

3,176

3,609

Placements

137

129

170

Average fee

22,891

24,667

21,327

Kforce Inc.

Non-GAAP Financial Measures

(Unaudited)

In addition to our financial results presented in accordance with GAAP, Kforce may use certain non-GAAP financial measures, which we believe provide useful information to investors in evaluating our core operating performance. The following non-GAAP financial measures presented may not provide information that is directly comparable to that provided by other companies, as other companies may calculate such financial results differently. Our non-GAAP financial measures are not measurements of financial performance under GAAP and should not be considered as alternatives to amounts presented in accordance with GAAP. We view these non-GAAP financial measures as supplemental, which are not intended to be a substitute for, or superior to, the information provided by GAAP financial results. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures is provided below.

Revenue Growth Rates

“Revenue growth rates,” a non-GAAP financial measure, is defined by Kforce as revenue growth after removing the impacts on reported revenues from the changes in the number of billing days. Management believes this data is particularly useful because it aids in evaluating revenue trends over time. The impact of billing days is calculated by dividing each comparative period’s reported revenues by the number of billing days for the respective period to arrive at a per billing day amount for each quarter. Growth rates are then calculated using the per billing day amounts as a percentage change compared to the respective period. Management calculates the number of billing days for each reporting period based on the number of holidays and business days in the quarter.

Sequential Growth Rates (GAAP)

2026

2025

Technology Flex

(0.2)%

(1.2)%

1.8%

(3.7)%

FA Flex

(5.6)%

2.4%

6.9%

2.1%

(12.8)%

Total Flex revenue

(0.6)%

(0.1)%

(0.7)%

1.8%

(4.3)%

Sequential Growth Rates (Non-GAAP)

2026

2025

Billing Days

Technology Flex

(1.8)%

3.0%

(1.2)%

0.2%

(5.2)%

FA Flex

(7.1)%

5.7%

6.9%

0.5%

(14.2)%

Total Flex revenue

(2.2)%

3.2%

(0.7)%

0.2%

(5.8)%

Year-Over-Year Growth Rates (GAAP)

2026

2025

Technology Flex

0.2%

(3.3)%

(5.5)%

(5.0)%

FA Flex

5.7%

(2.4)%

(7.3)%

(16.8)%

(23.2)%

Total Flex revenue

0.5%

(3.3)%

(5.7)%

(5.8)%

(6.4)%

Year-Over-Year Growth Rates (Non-GAAP)

2026

2025

Billing Days

Technology Flex

0.2%

(3.3)%

(5.5)%

(5.0)%

(3.5)%

FA Flex

5.7%

(2.4)%

(7.3)%

(16.8)%

(22.0)%

Total Flex revenue

0.5%

(3.3)%

(5.7)%

(5.8)%

(4.9)%

Free Cash Flow

“Free Cash Flow,” a non-GAAP financial measure, is defined by Kforce as net cash provided by operating activities determined in accordance with GAAP, less capital expenditures. Management believes this provides an additional way of viewing our liquidity that, when viewed with our GAAP results, provides a more complete understanding of factors and trends affecting our cash flows and is useful information to investors as it provides a measure of the amount of cash generated from the business that can be used for strategic opportunities including investing in our business, repurchasing common stock, paying dividends or making acquisitions. Free Cash Flow has limitations due to the fact that it does not represent the residual cash flow available for discretionary expenditures. Therefore, we believe it is important to view Free Cash Flow as a complement to, but not a replacement of, our unaudited condensed consolidated statements of cash flows.

The following table presents Free Cash Flow:

Three Months Ended March 31,

(in thousands)

2026

2025

Net cash used by operating activities

(4,055

)

249

Capital expenditures

(3,345

)

(4,149

)

Free cash flow

(7,400

)

(3,900

)

Change in debt

25,100

32,800

Repurchases of common stock

(11,683

)

(21,066

)

Cash dividends

(6,821

)

(7,051

)

Premiums paid for company-owned life insurance

—

(686

)

Other

—

)

Change in cash and cash equivalents

(804

)

Adjusted EBITDA

“Adjusted EBITDA,” a non-GAAP financial measure, is defined by Kforce as net income before depreciation and amortization; stock-based compensation expense; interest expense, net income tax expense; organizational realignment activities; and certain other items. Adjusted EBITDA should not be considered a measure of financial performance under GAAP. Items excluded from Adjusted EBITDA are significant components in understanding and assessing our past and future financial performance, and this presentation should not be construed as an inference by us that our future results will be unaffected by those items excluded from Adjusted EBITDA. Adjusted EBITDA is a key measure used by management to assess our operations including our ability to generate cash flows and our ability to repay our debt obligations, and management believes it provides a good metric of our core profitability in comparing our performance to our competitors, as well as our performance over different time periods. Consequently, management believes it is useful information to investors. The measure should not be considered in isolation or as an alternative to net income, cash flows or other financial statement information presented in the unaudited condensed consolidated financial statements as indicators of financial performance or liquidity. Also, Adjusted EBITDA, as presented, may not be comparable to similarly titled measures of other companies.

In addition, although we excluded stock-based compensation expense because it is a non-cash expense, we expect to continue to incur stock-based compensation expense in the future and the associated stock issued may result in an increase in our outstanding shares of stock, which may result in the dilution of our shareholder ownership interest. We suggest that you evaluate these items and the potential risks of excluding such items when analyzing our financial position.

The following table presents Adjusted EBITDA and includes a reconciliation of Net income to Adjusted EBITDA:

Three Months Ended

(in thousands)

March 31, 2026

December 31, 2025

March 31, 2025

Net income

7,925

5,163

8,145

Depreciation and amortization

1,304

1,323

1,464

Stock-based compensation expense

3,590

3,434

3,656

Interest expense, net

649

782

565

Income tax expense

3,429

2,613

2,921

Organizational realignment activities

—

1,200

—

Other (1)

—

2,233

—

Adjusted EBITDA

16,897

16,748

16,751

(1) Other includes non-recurring expenses to further streamline our operating costs, including the write-off of previously capitalized software.