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JOB NYSE AM· GEE Group Inc.
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JOB NYSE AM· GEE Group Inc.
Earnings report Q4 2023

JOB's Revenue Declines by 26% in Latest Quarter

Segments of revenue

In the latest quarter, JOB reported consolidated net revenues of $30.63 million, a decrease of $10.52 million or 26% compared to the same period last year. The revenue was primarily generated from two segments: professional and industrial contract services, and direct hire placement services. Professional contract services accounted for $25.08 million or approximately 82% of the total revenue, while industrial contract services contributed $2.49 million or approximately 8%. Direct hire placement services, on the other hand, contributed $3.06 million or approximately 10% of the consolidated revenue.

Strengths

Despite the decline in revenue, JOB's professional contract services segment remained the major revenue driver, contributing 90% of the consolidated revenue. This indicates the company's strong position in providing professional staffing solutions. Additionally, management attributes the decrease in revenue to challenging economic conditions and labor market uncertainties, suggesting that the decline is not solely due to internal factors.

Challenges

The decline in revenue can be attributed to various factors. Industrial staffing services experienced a significant decrease of $1.12 million or 31% due to reduced orders from clients and increased competition for orders and temporary labor. Moreover, direct hire placement revenue declined by $2.69 million or approximately 47% compared to the same period last year. This decline can be attributed to the cyclical nature of direct hire opportunities, which tend to rise during economic recovery and decline during downturns. The challenging economic conditions and uncertainties further impacted the number of orders and candidates available for placements across JOB's businesses.

Noteworthy

It is worth noting that the overall U.S. Staffing Industry has also experienced declines in performance, indicating that JOB's challenges are not unique to the company. The industry outlook suggests that these conditions are expected to continue at least during the first half of calendar year 2024. Therefore, JOB's future near-term results may also be impacted, potentially resulting in lower results for the full fiscal year ending September 30, 2024.

Summary

JOB's latest quarter performance reflects a decline in revenue of 26% compared to the same period last year. The decrease can be attributed to challenges in both the industrial staffing services and direct hire placement services segments. However, JOB's strength lies in its professional contract services segment, which remains the major revenue driver. The decline in revenue is primarily due to challenging economic conditions and labor market uncertainties, which have negatively impacted the number of orders and candidates available for placements. It is important to note that the overall U.S. Staffing Industry has also experienced declines, indicating that JOB's challenges are part of broader industry trends.

Source documents

Form 10-Q  filed on Feb 13, 2024
91 pages scanned

Reference data

Company financials Q4 revenue 30.6M
Analyst estimates Q4 EPS missed by -150.00%
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