Kforce Reports Third Quarter 2025 Revenue of $332.6 Million and EPS of $0.63

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 third quarter of 2025.

We are pleased with our performance in the third quarter where we exceeded both top and bottom line expectations led by better-than-expected results in both our Technology and FA businesses.

Joseph J. Liberatore, President and Chief Executive Officer, said, "We are pleased with our performance in the third quarter where we exceeded both top and bottom line expectations led by better-than-expected results in both our Technology and FA businesses. We are particularly encouraged that, following the early third quarter lows, consultants on assignment in our Technology segment improved throughout the third quarter. Our team has also done a nice job stabilizing and now meaningfully growing our FA business sequentially. The momentum has largely been carried into the fourth quarter, which puts us in a position to expect to deliver sequential billing day growth in both our Technology and FA businesses in the fourth quarter."

Quarterly Financial Highlights

Fourth Quarter 2025 - Guidance

Looking forward to the fourth quarter of 2025, there will be 62 billing days, compared to 64 billing days in the third quarter of 2025 and 62 billing days in the fourth quarter of 2024. Current estimates for the fourth quarter of 2025 are:

Conference Call

On Monday, November 3, 2025, 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 18,000 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 the momentum in both our Technology and FA businesses, and the Firm's guidance for the fourth quarter of 2025. 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, Department of Government Efficiency (DOGE) actions, federal administration actions, and the impacts of the recent government shutdown, 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, 2024, as well as assumptions regarding the foregoing. The terms “should,” “believe,” “estimate,” “expect,” “intend,” “anticipate,” “plan” 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

September 30, 2025

June 30, 2025

September 30, 2024

Revenue

332,645

334,316

353,319

Direct costs

240,388

243,668

254,752

Gross profit

92,257

90,648

98,567

Selling, general and administrative expenses

75,884

74,370

78,308

Depreciation and amortization

1,371

1,390

1,543

Income from operations

15,002

14,888

18,716

Other expense, net

758

1,029

429

Income before income taxes

14,244

13,859

18,287

Income tax expense

3,176

3,410

4,078

Net income

11,068

10,449

14,209

Earnings per share – diluted

0.63

0.59

0.75

Weighted average shares outstanding – diluted

17,645

17,759

18,823

Adjusted EBITDA

19,407

19,885

23,808

Billing days

Kforce Inc.

Consolidated Balance Sheets

(In Thousands)

(Unaudited)

September 30, 2025

December 31, 2024

ASSETS

Current assets:

Cash and cash equivalents

1,252

349

Trade receivables, net of allowances

204,468

215,690

Prepaid expenses and other current assets

12,116

9,367

Total current assets

217,836

225,406

Fixed assets, net

6,304

7,723

Other assets, net

119,819

94,656

Deferred tax assets, net

5,153

5,009

Goodwill

25,040

Total assets

374,152

357,834

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable and other accrued liabilities

62,777

61,753

Accrued payroll costs

47,991

38,823

Current portion of operating lease liabilities

3,225

3,038

Income taxes payable

2,099

8,843

Total current liabilities

116,092

112,457

Long-term debt – credit facility

65,000

32,700

Other long-term liabilities

60,939

58,059

Total liabilities

242,031

203,216

Commitments and contingencies

Stockholders’ equity:

Preferred stock

—

Common stock

739

738

Additional paid-in capital

554,511

543,109

Retained earnings

554,083

546,202

Treasury stock, at cost

(977,212

)

(935,431

)

Total stockholders’ equity

132,121

154,618

Total liabilities and stockholders’ equity

374,152

357,834

Kforce Inc.

Key Statistics

(Unaudited)

Q3 2025

Q2 2025

Q3 2024

Total Firm

Total Revenue (000’s)

332,645

334,316

353,319

GP %

27.7

27.1

27.9

Flex revenue (000’s)

326,263

328,411

345,832

Hours (000's)

3,795

3,787

4,008

Flex GP %

26.3

25.8

26.3

Direct Hire revenue (000’s)

6,382

5,905

7,487

Placements

276

269

342

Average fee

23,143

21,964

21,907

Billing days

Technology

Total Revenue (000’s)

307,145

310,527

325,511

GP %

26.8

26.3

26.9

Flex revenue (000’s)

304,272

307,844

322,118

Hours (000’s)

3,383

3,404

3,553

Flex GP %

26.1

25.6

26.1

Direct Hire revenue (000’s)

2,873

2,683

3,393

Placements

117

116

156

Average fee

24,633

23,154

21,813

Finance and Accounting

Total Revenue (000’s)

25,500

23,789

27,808

GP %

38.9

38.1

39.8

Flex revenue (000’s)

21,991

20,567

23,714

Hours (000’s)

412

383

455

Flex GP %

29.1

28.5

29.4

Direct Hire revenue (000’s)

3,509

3,222

4,094

Placements

159

153

186

Average fee

22,050

21,063

21,985

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)

2025

2024

Technology Flex

(1.2)%

1.8%

(3.7)%

(2.5)%

(0.6)%

FA Flex

6.9%

2.1%

(12.8)%

(2.7)%

(4.1)%

Total Flex revenue

(0.7)%

1.8%

(4.3)%

(2.5)%

(0.8)%

Sequential Growth Rates (Non-GAAP)

2025

2024

Billing Days

Technology Flex

(1.2)%

0.2%

(5.2)%

0.6%

(0.6)%

FA Flex

6.9%

0.5%

(14.2)%

0.5%

(4.1)%

Total Flex revenue

(0.7)%

0.2%

(5.8)%

0.6%

(0.8)%

Year-Over-Year Growth Rates (GAAP)

2025

2024

Technology Flex

(5.5)%

(5.0)%

(3.7)%

(3.6)%

FA Flex

(7.3)%

(16.8)%

(23.2)%

(22.1)%

(20.7)%

Total Flex revenue

(5.7)%

(5.8)%

(6.4)%

(5.2)%

(5.0)%

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

2025

2024

Billing Days

Technology Flex

(5.5)%

(5.0)%

(3.5)%

(5.2)%

(5.1)%

FA Flex

(7.3)%

(16.8)%

(22.0)%

(23.3)%

(21.9)%

Total Flex revenue

(5.7)%

(5.8)%

(4.9)%

(6.7)%

(6.5)%

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:

Nine Months Ended September 30,

(in thousands)

2025

2024

Net cash provided by operating activities

41,937

65,084

Capital expenditures

(11,798

)

(8,501

)

Free cash flow

30,139

56,583

Change in debt

32,300

(14,700

)

Repurchases of common stock

(41,450

)

(21,189

)

Cash dividends

(20,778

)

(21,282

)

Proceeds from company-owned life insurance

1,383

2,377

Premiums paid for company-owned life insurance

(686

)

(1,777

)

Other

)

Change in cash and cash equivalents

903

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; and income tax expense. 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)

September 30, 2025

June 30, 2025

September 30, 2024

Net income

11,068

10,449

14,209

Depreciation and amortization

1,371

1,390

1,543

Stock-based compensation expense

3,034

3,618

3,549

Interest expense, net

758

1,018

429

Income tax expense

3,176

3,410

4,078

Adjusted EBITDA

19,407

19,885

23,808