GEE Group Inc.
For the period ended Dec 31, 2025. Filed Feb 12, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 31, 2025 · Filed Feb 12, 2026
JOB$0.19-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-13.
0001477932-25-005776
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-12-31; filed 2026-02-12.
0001477932-26-000783
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 95 previous paragraphs and 59 current paragraphs.
29 unchanged; 23 reworded; 7 added; 35 removed; 8 previous and 0 current paragraphs rearranged.
Tables are not compared: 9 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (7)
Current report
We learned at the end of fiscal 2025 that one of our larger accounts was acquired. As a result, our services were terminated as of October 1, 2025, and replaced by comparable services provided by an affiliate of the acquirer. This account produced revenues of $2.6 million and contributed approximately $483 thousand, net of direct expenses, to income (loss) from operations during the fiscal first quarter ended December 31, 2024. We believe recent additions to our customer base will partially mitigate the loss of this account.
Current report
Direct hire placement revenue for the three months ended December 31, 2025 increased $205, or approximately 8%, as compared to the three months ended December 31, 2024. Direct hire opportunities tend to be highly cyclical and demand dependent and may be expected to rise during times of economic recovery and decline during downturns and periods of uncertainty. At the same time, and while this increase is encouraging, we believe it is still too early to consider it a significant sign of recovery in our business and we remain cautiously optimistic.
Current report
Staffing Industry Analysts (“SIA”), a leading industry trade organization, recently published in its September 2025 U.S. Staffing Industry Forecast update, that the U.S. Staffing Industry as a whole is expected to decline by 3% in 2025. This follows a 12% decline already experienced in 2024. The SIA report cites that the forecasted 2025 decline is expected due to widespread client caution, a slow labor market, reduced employee churn and flat bill rates. While our businesses serve clients of all sizes, a substantial number of our clients are small and medium-sized enterprises, which have less financial flexibility to absorb rising costs and higher borrowing expenses, making them more likely to reduce or postpone usage of our services and contract employees. We believe this is a key reason why our 2025 revenue declines have exceeded those forecasted by SIA for the staffing industry overall.
Current report
Interest expense was $65 and $66 for the three-month periods ended December 31, 2025 and 2024, respectively, and was comprised mainly of fees associated with our Facility including unused capacity fees, administrative charges, and the amortization of related debt issuance costs. No advances were taken on our Facility during the three-month periods ended December 31, 2025 and 2024.
Current report
Other Income
Current report
Other income was $196 for the three months ended December 31, 2025 and was the result of elimination of a portion of the Promissory Notes issued to Hornet’s former shareholders as part of the purchase consideration. Under the Purchase Agreement, payments on the Promissory Notes are to be made annually in two equal installments on the first and second anniversaries of the issuance date. These payments are contingent upon the achievement of minimum average gross profit (“AGP”) requirements by Hornet over the first two annual periods prior to closing. The first installments of the Promissory Notes have been entirely eliminated as of December 31, 2025 due to the minimum AGP requirements not being met.
Current report
In accordance with the provisions of ASC Topic 740,*Income Taxes,*we did not recognize an income tax benefit on the loss reported for the three months ended December 31, 2025 because the Company expects to recognize pre-tax income for the full year. The Company also did not recognize an income tax benefit for the three months ended December 31, 2024, as the Company similarly expected pre-tax income for the full year ended September 30, 2025.
Removed paragraphs (35)
Previous report
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Previous report
Direct hire placement revenue for the three months ended June 30, 2025 decreased $65, or approximately 2%, as compared to the three months ended June 30, 2024.
Previous report
Intangible Assets Impairment
Previous report
We performed an evaluation of our intangible assets as of June 30, 2024, and determined that certain asset groups associated with our intangible assets including certain customer lists and tradenames were producing negative or sufficiently low gross cash flows that their estimated future discounted cash flows indicated impairments of the remaining unamortized balances. As a result, we recorded a non-cash impairment charge of $5,209 on intangible assets during the three months ended June 30, 2024.
Previous report
Goodwill Impairment
Previous report
We completed an interim goodwill impairment assessment as of June 30, 2024 and determined that our goodwill was impaired. The estimated fair value of the Professional Services reporting unit decreased as compared to those resulting from the September 30, 2023 annual assessment, indicating that the pre-assessment carrying value as of June 30, 2024 exceeded the estimated fair values. As a result, a non-cash goodwill impairment charge of $14,201 was taken during the three months ended June 30, 2024 so that the carrying value of the Professional Services reporting unit reflected its estimated fair value, as determined by the interim evaluations made of our goodwill.
Previous report
Interest expense was $112 and $113 for the three-month periods ended June 30, 2025 and 2024, respectively, and is mainly attributable to unused availability and administrative fees on our Facility.
Previous report
We recognized income tax benefits of $115 and $2,546 for the three-month periods ended June 30, 2025 and 2024, respectively. Our effective tax rate for the three-month period ended June 30, 2025 is higher than the statutory rate primarily due to the change in the valuation allowance between quarters. The incremental change in valuation allowance has a greater impact because of the smaller change in pre-tax book loss. Our effective tax rate for the three-month period ended June 30, 2024 is lower than the statutory rate primarily due to the effect of the valuation allowance on our net DTA position. Other than the deferred tax liability relating to indefinite lived assets, we are maintaining a full valuation allowance against the remaining net DTA position.
Previous report
Nine Months Ended June 30, 2025 Compared to the Nine Months Ended June 30, 2024
Previous report
Net Revenues
Previous report
Direct hire placement revenues for the nine-month periods ended June 30, 2025 decreased $64, or approximately 1%, as compared to the three months ended June 30, 2024.
Previous report
Cost of Contract Services
Previous report
Gross profit percentage by service:
Previous report
Selling, General and Administrative Expenses
Previous report
Our SG&A for the nine months ended June 30, 2025 decreased by $2,796 as compared to the nine months ended June 30, 2024. SG&A for the nine-month periods ended June 30, 2025 and 2024, as a percentage of revenues, each were approximately 36.5%. The higher percentages of SG&A expenses to revenues , as compared with historical SG&A ratios in the low-to-mid 30% range is mainly attributable to lower revenues in relation to fixed costs, including certain personnel, occupancy and costs associated with applicant tracking systems and job boards. In addition, higher incentive compensation on direct hire placement revenues, which remained relatively level over the current and prior nine-month periods, as contrasted with lower professional contract revenues, contributed to the higher SG&A ratios. These two items were offset by certain cost reductions and productivity improvements made during the nine months ended June 30, 2025.
Previous report
Amortization and Depreciation Expense
Previous report
Amortization expense was $655 and $2,159 for the nine-month periods ended June 30, 2025, and 2024, respectively. The significant decline in amortization expense is mainly due to impairment charges recorded during the fiscal year ended September 30, 2024, which substantially reduced the remaining unamortized balances of our identifiable intangible assets and present amortization, accordingly. Depreciation expense was $154 and $201 for the nine-month periods ended June 30, 2025, and 2024, respectively.
Previous report
Intangible Assets Impairment
Previous report
We performed an evaluation of our intangible assets as of June 30, 2024, and determined that certain asset groups associated with our intangible assets including certain customer lists and tradenames were producing negative or sufficiently low gross cash flows that their estimated future discounted cash flows indicated impairments of the remaining unamortized balances. As a result, we recorded a non-cash impairment charge of $5,209 on intangible assets during the nine months ended June 30, 2024.
Previous report
Goodwill Impairment
Previous report
We completed an interim goodwill impairment assessment as of March 31, 2025 and determined that our goodwill was impaired. The estimated fair value of our Professional Services reporting unit decreased as compared to those resulting from the September 30, 2024 annual assessment, indicating that the pre-assessment carrying value as of March 31, 2025 exceeded its estimated fair value. We also completed an interim goodwill assessment as of June 30, 2024 which determined our goodwill was impaired. As a result, non-cash goodwill impairment charges of $22,000 and $14,201 were recognized during the nine-month periods ended June 30, 2025 and 2024, respectively, so that the carrying values of the Professional Services reporting unit reflected its estimated fair value, as determined by the interim evaluations made of our goodwill.
Previous report
Loss from Operations
Previous report
Loss from operations was $(24,537) and $(24,303) for the nine-month periods ended June 30, 2025 and 2024, respectively. This slight increase is due to the increase in non-cash impairment charges included in loss from operations for the nine-month period ended June 30, 2025, as compared with the nine-month period ended June 30, 2024, as well as the other matters discussed in the preceding paragraphs.
Previous report
Interest Expense
Previous report
Interest expense was $267 and $247 for the nine-month periods ended June 30, 2025 and 2024, respectively, and is mainly attributable to unused availability and administrative fees on our Facility.
Previous report
Interest Income
Previous report
Provision for Income Taxes
Previous report
We recognized income tax benefit (expense) of $(9,671) and $3,461 for the nine-month periods ended June 30, 2025 and 2024, respectively. Our effective tax rates for the nine-month periods ended June 30, 2025 and 2024 are lower than the statutory rate primarily due to the effect of the valuation allowance on our net DTA position.
Previous report
As of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. In view of the significance of our recent pre-tax book losses and the likelihood of continuing uncertainty in the industry and economy as a whole, management excluded projections of future income from its forecast of the reversal of our DTAs as of March 31, 2025. As a result, it was determined that our net DTAs would not be realized as there is not sufficient positive evidence to conclude that it is more likely than not that the deferred taxes are realizable. We recorded an additional $12,426 valuation allowance, accordingly, during the nine months ended June 30, 2025.
Previous report
Loss from Discontinued Operations
Previous report
As a result of our Industrial Segment being deemed a discontinued operation, the results of that segment have been reclassified to loss from discontinued operations in the accompanying unaudited condensed consolidated statements of operations. On June 2, 2025, we entered into an agreement to sell certain operating assets of our Industrial Segment and recorded a net gain on sale of $133 during the nine-month period ended June 30, 2025. Loss from discontinued operations, including the net gain recorded upon sale, was $(193) and $(1,308) for the nine-month periods ended June 30, 2025 and 2024, respectively.
Previous report
Consolidated Net Loss
Previous report
Our consolidated net loss was $(34,234) and $(21,849) for the nine-month periods ended June 30, 2025 and 2024, respectively. The increase in consolidated net loss is primarily the result of the increase in non-cash impairment charges, and valuation allowance related to our net deferred tax assets recognized during the nine-month period ended June 30, 2025, as explained in the preceding paragraphs.
Previous report
The decreases in cash and working capital are mainly attributable to the effects of lower overall business volume during the nine months ended June 30, 2025. In addition, we disbursed $1,100 in cash to the sellers of Hornet and paid related legal and professional fees of $111. We received $712 in cash from the buyer of the Industrial Segment’s assets during the nine-month period ended June 30, 2025.
Previous report
On April 27, 2023, our Board of Directors approved a share repurchase program authorizing the Company to purchase up to an aggregate of $20 million of our currently outstanding shares of common stock. The share repurchase program continued through December 31, 2023. The repurchase program did not obligate us to repurchase any number of shares of common stock. The share repurchase program was conducted in accordance with Rules 10b-5 and 10b-18 of the Securities Exchange Act of 1934, as amended. Subject to applicable rules and regulations, shares of common stock were purchased from time to time in the open market transactions and in amounts we deemed appropriate, based on factors such as market conditions, legal requirements, and other business considerations. During the nine months ended June 30, 2024, we repurchased 2,717 shares of our common stock at a total cost of $1,575. Upon conclusion of the share repurchase program, as of December 31, 2023, we repurchased 6,129 shares in aggregate (accounting for approximately 5.4% of our issued and outstanding common shares immediately prior to the program).
Reworded paragraphs (23)
Previous wording
GEE Group Inc. and its wholly owned material operating subsidiaries, Access Data Consulting Corporation, Agile Resources, Inc., Hornet Staffing, Inc., Paladin Consulting, Inc., Scribe Solutions, Inc., SNI Companies, Inc., and Triad Personnel Services, Inc. are providers of permanent and temporary professional and industrial staffing and placement services in and near several major U.S. cities. We specialize in the placement of information technology, accounting, finance, office, and engineering professionals for direct hire and contract staffing for our clients, and data entry assistants (medical scribes) who specialize in electronic medical records (EMR) services for emergency departments, specialty physician practices and clinics. GEE Group Inc.’s former wholly owned subsidiaries, BMCH, Inc. and Triad Logistics, Inc., provided temporary staffing services for our industrial clients until their operations were discontinued and assets were sold on June 2, 2025.
Current wording
GEE Group Inc. and its wholly owned material operating subsidiaries, Access Data Consulting Corporation, Agile Resources, Inc., Hornet Staffing, Inc., Paladin Consulting, Inc., Scribe Solutions, Inc., SNI Companies, Inc., and Triad Personnel Services, Inc. are providers of permanent and temporary professional staffing and placement services in and near several major U.S. cities. We specialize in the placement of information technology, accounting, finance, office, and engineering professionals for direct hire and contract staffing for our clients, and data entry assistants (medical scribes) who specialize in electronic medical records (EMR) services for emergency departments, specialty physician practices and clinics. GEE Group Inc.’s former wholly owned subsidiaries, BMCH, Inc. and Triad Logistics, Inc., provided temporary staffing services for our industrial clients until their operations were discontinued and assets were sold on June 2, 2025.
Previous wording
Our contract and placement services are currently provided under our Professional Staffing Services operating division or segment. Our former Industrial Staffing Services segment was deemed a discontinued operation as of the quarter ended March 31, 2025 and is excluded from results of continuing operations reported in this MD&A, unless otherwise stated.
Current wording
Our contract and placement services are currently provided under our Professional Staffing Services operating division or segment. Our former Industrial Staffing Services segment was designated a discontinued operation during fiscal 2025 and is excluded from results of continuing operations reported in this MD&A, unless otherwise stated.
Previous wording
We have incurred a net loss of $(423) thousand for the fiscal third quarter ended June 30, 2025. The net loss is primarily attributable to continuation of adverse trends and conditions in the U.S. labor markets that began in 2023, continued throughout 2024, and have persisted so far in 2025. These conditions have negatively impacted the number of job orders received and the numbers of qualified candidates available to fill orders for placements across all of our lines of business. Likewise, the U.S. Staffing Industry, as a whole, has experienced material declines in overall volume and financial performance and the industry outlook remains mixed as to when these conditions may be expected to definitively subside. The net loss for the third quarter ended June 30, 2025, has lessened relative to the prior sequential quarters of fiscal 2025 due to the presence of a $22 million pre-tax non-cash impairment charge in the quarter ended March 31, 2025, and operating cost reductions and other productivity improvement measures.
Current wording
We have incurred net losses of $(150) thousand and $(692) thousand for the fiscal first quarters ended December 31, 2025 and 2024, respectively. The net losses are primarily attributable to economic uncertainties, including persistent inflation and high interest rates, and related instability in the U.S. labor markets that began in 2023, and have persisted throughout 2025. These conditions have negatively impacted the number of job orders received and the numbers of qualified candidates available to fill orders for placements across all of our lines of business. Likewise, the U.S. Staffing Industry, as a whole, has experienced material declines in overall volume and financial performance and the industry outlook remains mixed as to when these conditions may be expected to definitively subside. The net loss for the fiscal first quarter ended December 31, 2025 has lessened relative to the prior year’s first quarter ended December 31, 2024, and prior sequential calendar quarters of fiscal 2025 due to operating cost reductions and other productivity improvement initiatives. We were able to reduce selling, general, and administrative expenses (“SG&A”) by approximately $3.8 million on an annual basis, with the remaining benefit of these expected to be realized over fiscal 2026. We also remain committed and prepared to make additional cost cuts necessary to restore profitability.
Previous wording
As of March 31, 2025, and continuing through June 30, 2025, we classified and reported our Industrial Segment as a discontinued operation. The decision to discontinue this division is in continuance with our long-term strategy and focus on the professional verticals within our business. The initiative to seek a buyer for the Industrial Segment was approved on April 18, 2024, as part of our plans and budgets comprehended in the M&A Committee’s strategic recommendations developed during a formal review of strategic alternatives last year. Other strategic recommendations stemming from the strategic alternatives review are on-going, including (1) proactive measures to streamline operations and enhance growth opportunities and cost-efficiency, including significant cost reductions, (2) building upon past acquisitions by taking advantage of current conditions and further integrating and consolidating operations and systems for further efficiencies and cost saving opportunities, and (3) capitalizing on acquisition opportunities arising from the economic downturn by identifying and with the objective of acquiring businesses at reduced multiples and favorable valuations.
Current wording
Starting in fiscal 2025, we classified and reported our Industrial Segment as a discontinued operation. The decision to discontinue this division is in continuance with our long-term strategy and focus on the professional verticals within our business. The initiative to seek a buyer for the Industrial Segment was approved on April 18, 2024, as part of our plans and budgets comprehended in the M&A Committee’s strategic recommendations developed during a formal review of strategic alternatives last year. Other strategic recommendations stemming from the strategic alternatives review are on-going, including (1) proactive measures to streamline operations and enhance growth opportunities and cost-efficiency, including significant cost reductions, (2) building upon past acquisitions by taking advantage of current conditions and further integrating and consolidating operations and systems for further efficiencies and cost saving opportunities, and (3) capitalizing on acquisition opportunities arising from the economic downturn by identifying and with the objective of acquiring businesses at reduced multiples and favorable valuations.
Previous wording
On June 2, 2025, we entered into an agreement for the sale of certain operating assets of the Industrial Segment, including those of BMCH, Inc., Triad Logistics, Inc., and our Triad Staffing brand. We received total cash consideration of $250 from the buyer at closing and are to receive an additional $788 payable during the first 90 days following closing. We have received $462 of the additional payments due as of June 30, 2025. A pre-tax net gain of $133, including transaction costs of $97, is included in discontinued operations for the three-month period ended June 30, 2025. The remaining assets of the Industrial Segment not sold were distributed to the Company.
Current wording
On June 2, 2025, we entered into an agreement for the sale of certain operating assets of the Industrial Segment, including those of BMCH, Inc., Triad Logistics, Inc., and our Triad Staffing brand. The remaining assets of the Industrial Segment not sold were distributed to the Company.
Previous wording
Professional contract staffing services contributed $21,301 or approximately 87% of consolidated revenue and direct hire placement services contributed $3,222, or approximately 13%, of consolidated revenue for the three months ended June 30, 2025. This compares to professional contract staffing services revenue of $23,761, or approximately 88%, of consolidated revenue and direct hire placement revenue of $3,287, or approximately 12%, of consolidated revenue for the three months ended June 30, 2024.
Current wording
Professional contract staffing services contributed $17,800 or approximately 87% of consolidated revenue and direct hire placement services contributed $2,716, or approximately 13%, of consolidated revenue for the three months ended December 31, 2025. This compares to professional contract staffing services revenue of $21,514, or approximately 90%, of consolidated revenue and direct hire placement revenue of $2,511, or approximately 10%, of consolidated revenue for the three months ended December 31, 2024.
Previous wording
Economic uncertainties, including persistent inflation and the possibility of recession, continued to adversely affect trends and conditions in the U.S. labor markets, which in turn, have continued to negatively impact our results through the three months ended June 30, 2025. Professional contract staffing services revenues decreased $2,460, or 10%, as compared to the three months ended June 30, 2024. Professional contract staffing services for the three months ended June 30, 2025 includes $1,157 of revenues generated by Hornet, which was acquired by the Company effective January 3, 2025. The former light industrial segment revenues of $1,068 and $2,048 for the three months ended June 30, 2025 and 2024, respectively, have been reclassified as discontinued operations and are no longer included in professional contract staffing services.
Current wording
As mentioned in ourSummary and Outlook discussion above, one of our larger accounts terminated our services as of October 1, 2025, upon being acquired and accessing comparable services provided by an affiliate of the acquirer. This account produced revenues of $1,714 during the prior sequential three months ended September 30, 2025 and $2,570 during the three months ended December 31, 2024. Economic uncertainties, including persistent inflation and high interest rates, also continued to adversely affect trends and conditions in the U.S. labor markets, which in turn, have continued to negatively impact our results and ability to grow through the three months ended December 31, 2025. The proliferation of AI applications and tools is also having disruptive effects on our business by causing business plans, hiring plans, and HR needs across industries, including those we serve, to be reconsidered. As a result of these events and trends, professional contract staffing services revenues decreased $3,714, or 17%, as compared to the three months ended December 31, 2024. Professional contract staffing services for the three months ended December 31, 2025 includes $1,236 of revenues generated by Hornet, which was acquired by the Company effective January 3, 2025.
Previous wording
Cost of contract services includes wages and related payroll taxes and employee benefits of our contract services employees, and certain other contract employee-related costs, while working on contract assignments. Cost of contract services for the three months ended June 30, 2025 decreased by approximately 11% to $15,842 compared to $17,819 for the three months ended June 30, 2024. The $1,977 overall decrease in cost of contract services is consistent with the decrease in revenues as discussed above.
Current wording
Cost of contract services includes wages and related payroll taxes, employee benefits of our contract services employees, and certain other contract employee-related costs, while working on contract assignments. Cost of contract services for the three months ended December 31, 2025 decreased by approximately 19% to $13,111 compared to $16,099 for the three months ended December 31, 2024. The $2,988 overall decrease in cost of contract services is consistent with the decrease in revenues as discussed above. As further explained below, our gross profit and gross margin for the three months ended December 31, 2025 are proportionally higher relative to revenue than those for the comparable three months ended December 31, 2024.
Previous wording
Our combined gross profit margin, including direct hire placement services, for the three-month periods ended June 30, 2025 and 2024 were approximately 35.4% and 34.1%, respectively. Our professional contract staffing services gross margins for the three-month periods ended June 30, 2025 and 2024 were approximately 25.6% and 25.0%, respectively. The net increase in our combined gross margin is mainly attributable to an increase in the mix of direct hire placement revenues, which have a 100% gross margin. The increase in professional contract staffing services gross margin is attributable to net increases in prices and spreads on some of our professional contract services businesses.
Current wording
Our combined gross profit margin, including direct hire placement services, for the three-month periods ended December 31, 2025 and 2024 were approximately 36.1% and 33.0%, respectively. Our professional contract staffing services gross margins for the three-month periods ended December 31, 2025 and 2024 were approximately 26.3% and 25.2%, respectively. The net increase in our combined gross margin is mainly attributable to an increase in the mix of direct hire placement revenues, which have a 100% gross margin. The increase in professional contract staffing services gross margin is attributable to net increases in prices and spreads on some of our professional contract services businesses.
Previous wording
Our SG&A for the three months ended June 30, 2025 decreased by $802 as compared to the three months ended June 30, 2024. SG&A for the three months ended June 30, 2025, as a percentage of revenues, were approximately 36.5% compared to approximately 36.1% for the three months ended June 30, 2024. The increase in SG&A expenses as a percentage of revenues during the three months ended June 30, 2025 was attributable to lower revenues in relation to fixed costs, including certain personnel, occupancy and costs associated with applicant tracking systems and job boards. In addition, higher incentive compensation on direct hire placement revenues, which remained relatively level quarter over quarter, as contrasted with lower professional contract revenues, contributed to the higher SG&A ratios. These two items were offset by certain cost reductions and productivity improvements during the three months ended June 30, 2025.
Current wording
Our SG&A for the three months ended December 31, 2025 decreased by $731 as compared to the three months ended December 31, 2024. SG&A for the three months ended December 31, 2025, as a percentage of revenues, were approximately 37.6% compared to approximately 35.1% for the three months ended December 31, 2024. The increase in SG&A expenses as a percentage of revenues during the three months ended December 31, 2025 was attributable to lower revenues in relation to fixed costs, including certain personnel, occupancy and costs associated with applicant tracking systems and job boards. This was offset, in part, by certain cost reductions and productivity improvement initiatives made during the three months ended December 31, 2025 and the prior sequential quarters. These cost reductions contributed approximately $1,053 to the decrease in SG&A from the three months ended December 31, 2024.
Previous wording
SG&A includes certain non-cash and non-operational costs and expenses incurred related to acquisition, integration, restructuring and other non-recurring activities, such as certain corporate legal and general expenses associated with capital markets activities, that either are not directly associated with core business operations or have been eliminated on a going forward basis. These costs were $385 and $1,041 for the nine-month periods ended June 30, 2025 and 2024, respectively, and include mainly expenses associated with former closed and consolidated locations, legal expenses related to other than routine matters, and personnel costs associated with eliminated positions.
Current wording
SG&A includes certain non-cash and non-operational costs and expenses incurred related to acquisition, integration, restructuring and other non-recurring activities, such as certain corporate legal and general expenses associated with capital markets activities that either are not directly associated with core business operations or have been eliminated on a going forward basis. These costs were $94 and $91 for the three-month periods ended December 31, 2025 and 2024, respectively, and include mainly expenses associated with former closed or consolidated locations and severance costs associated with eliminated positions.
Previous wording
Amortization expense was $225 and $720 for the three-month periods ended June 30, 2025, and 2024, respectively. The significant decline in amortization expense is mainly due to impairment charges recorded during the fiscal year ended September 30, 2024, which substantially reduced the remaining unamortized balances of our identifiable intangible assets and present amortization, accordingly. Depreciation expense was $49 and $63 for the three-month periods ended June 30, 2025, and 2024, respectively.* *
Current wording
Amortization expense was $60 and $205 for the three-month periods ended December 31, 2025, and 2024, respectively. The decrease in amortization expense is due to certain intangible assets becoming fully amortized during the fiscal year ended September 30, 2025. Depreciation expense was $46 and $55 for the three-month periods ended December 31, 2025, and 2024, respectively.* *
Previous wording
Loss from operations was $(544) and $(20,717) for the three-month periods ended June 30, 2025 and 2024, respectively. This improvement in loss from operations is due to the inclusion of the non-cash impairment charges discussed in the preceding paragraphs in the three months ended June 30, 2024. In addition, we have made certain cost reductions and productivity improvements that have contributed to the improvement in the current quarter over prior sequential quarters of fiscal 2025.
Current wording
Loss from operations was $(409) and $(773) for the three-month periods ended December 31, 2025 and 2024, respectively. The improvement in loss from operations is primarily due to certain cost reductions and productivity improvements initiated in the current quarter and prior sequential quarter of fiscal 2025.
Previous wording
Interest income earned was $140 and $179 for the three-month periods ended June 30, 2025 and 2024, respectively. Interest income is earned on cash balances held in our two brokerage accounts.
Current wording
Interest income earned was $128 and $155 for the three-month periods ended December 31, 2025 and 2024, respectively. Interest income is earned on cash balances held in our two brokerage accounts. The reduction in interest income is primarily due to a reduction in interest rates available on our cash balances.
Previous wording
As a result of our Industrial Segment being deemed a discontinued operation, the results of that segment have been reclassified to loss from discontinued operations in the accompanying unaudited condensed consolidated statements of operations. On June 2, 2025, we entered into an agreement to sell certain operating assets of our Industrial Segment and recorded a gain on sale of $133 during the three-month period ended June 30, 2025. Loss from discontinued operations, including the gain recorded upon sale, was $(22) and $(1,181) for the three-month periods ended June 30, 2025 and 2024, respectively.
Current wording
As a result of our Industrial Segment being designated a discontinued operation, the results of that segment have been reclassified to loss from discontinued operations in the accompanying unaudited condensed consolidated statements of operations. On June 2, 2025, we entered into an agreement to sell substantially all of the operating assets of our former Industrial Segment. Loss from discontinued operations was $(8) for the three months ended December 31, 2024.
Previous wording
Our consolidated net loss was $(423) and $(19,286) for the three-month periods ended June 30, 2025 and 2024, respectively. The improvement in consolidated net loss is primarily the result of the non-cash impairment charges recorded in the three months ended June 30, 2024, and other relevant items, as explained in the preceding paragraphs.
Current wording
Our consolidated net loss was $(150) and $(692) for the three-month periods ended December 31, 2025 and 2024, respectively. The improvement in consolidated net loss is primarily the result of certain cost reductions and productivity improvements, and other relevant items, as explained in the preceding paragraphs.
Previous wording
The following table sets forth certain consolidated statements of cash flows data, including cash flows from discontinued operations:
Current wording
The following table sets forth certain consolidated statement of cash flows data, including cash flows from discontinued operations:
Previous wording
As of June 30, 2025, we had $18,622 of cash, a decrease of $2,206 from $20,828 as of September 30, 2024. As of June 30, 2025, we had working capital of $24,112 compared to $26,079 as of September 30, 2024.
Current wording
As of December 31, 2025, we had $20,149 of cash, a decrease of $1,215 from $21,364 as of September 30, 2025. As of December 31, 2025, we had working capital of $23,943 compared to $23,993 as of September 30, 2025.
Previous wording
The primary use of cash for investing activities was for the acquisition of Hornet during the nine months ended June 30, 2025. As described under Note 2, on January 3, 2025, we completed the acquisition of 100% of the outstanding common stock of Hornet Staffing, Inc., which is now our wholly owned subsidiary. We paid $1,100 of cash consideration at closing on January 3, 2025, and entered into two 5% uncollateralized subordinated promissory notes with the sellers in the aggregate amount of $400, each payable in two equal annual installments due at the end of the two subsequent years following closing. The purchase price and our obligations under the subordinated promissory notes are subject to reduction in the event Hornet Staffing does not achieve agreed upon profit metrics during the two years subsequent to closing on a dollar-for-dollar basis.
Current wording
The primary use of cash for investing activities were for the acquisition of property and equipment during the three-month periods ended December 31, 2025 and 2024.
Previous wording
The cash flows used in financing activities were primarily for purchases of treasury stock during the nine months ended June 30, 2024, and payments made on finance leases during the nine-month periods ended June 30, 2025 and 2024.
Current wording
The cash flows used in financing activities were primarily for payments made on finance leases during the three-month periods ended December 31, 2025 and 2024.
Previous wording
We had $6,566 in availability for borrowings under our facility as of June 30, 2025. There were no outstanding borrowings on the Facility as of June 30, 2025, or September 30, 2024, except for certain accrued incidental carrying fees and costs, which are included in other current liabilities in the accompanying unaudited condensed consolidated balance sheets.
Current wording
We had $4,166 in availability for borrowings under our facility as of December 31, 2025. There were no outstanding borrowings on the Facility as of December 31, 2025, or September 30, 2025, except for certain accrued incidental carrying fees and costs, which are included in other current liabilities in the accompanying unaudited condensed consolidated balance sheets.
Previous wording
On August 13, 2024, we re-issued 642 of its treasury shares to fulfill commitments for the issuance of previously granted restricted share awards that became fully vested and unrestricted. The treasury shares were reissued in lieu of issuing 642 new shares of our common stock, therefore, while our total number of outstanding shares of common stock increased by 642, its total number of issued shares of common stock did not increase as a result of the reissuance of treasury shares instead.
Current wording
On August 13, 2024, we reissued 642 of our treasury shares to fulfill commitments for the issuance of previously granted restricted share awards that became fully vested and unrestricted. On December 2, 2025, we reissued 592 additional treasury shares to fulfill commitments for the issuance of previously granted restricted share awards that became fully vested and unrestricted. These treasury shares were reissued in lieu of issuing new shares of our common stock, therefore, while our total number of outstanding shares of common stock increased as a result of each issuance, our total number of issued shares of common stock did not increase.
Previous wording
All our office facilities are leased. Minimum lease payments under all our lease agreements for the twelve-month period commencing after the close of business on June 30, 2025, are approximately $1,128. There are no minimum debt service principal payments due during the twelve-month period commencing after the close of business on June 30, 2025.
Current wording
All our office facilities are leased. Minimum lease payments under all our lease agreements for the twelve-month period commencing after the close of business on December 31, 2025, are approximately $1,185. There are no minimum debt service principal payments due during the twelve-month period commencing after the close of business on December 31, 2025.
Rearranged previous paragraphs (8)
Previous report — wording carried elsewhere
SG&A includes certain non-cash and non-operational costs and expenses incurred related to acquisition, integration, restructuring and other non-recurring activities, such as certain corporate legal and general expenses associated with capital markets activities, that either are not directly associated with core business operations or have been eliminated on a going forward basis. These costs were $68 and $46 for the three-month periods ended June 30, 2025 and 2024, respectively, and include mainly expenses associated with advisory fees and legal expenses related to other than routine matters.
Previous report — wording carried elsewhere
Consolidated net revenues are comprised of the following:
Previous report — wording carried elsewhere
Professional contract staffing services contributed $64,310 or approximately 88% of consolidated revenue and direct hire placement services contributed $8,733, or approximately 12%, of consolidated revenue for the nine months ended June 30, 2025. This compares to professional contract staffing services revenue of $71,977, or approximately 89%, of consolidated revenue and direct hire placement revenue of $8,797, or approximately 11%, of consolidated revenue for the nine months ended June 30, 2024.
Previous report — wording carried elsewhere
Economic uncertainties, including persistent inflation and the possibility of recession, continued to adversely affect trends and conditions in the U.S. labor markets, which in turn, have continued to negatively impact our results through the nine months ended June 30, 2025. Professional contract staffing services revenues decreased $7,677, or 11%, as compared to the nine months ended June 30, 2024. Professional contract staffing services for the nine months ended June 30, 2025 includes $2,112 of revenues generated by Hornet, which was acquired by the Company effective January 3, 2025. The former light industrial segment revenues of $4,614 and $7,363 for the nine months ended June 30, 2025 and 2024, respectively, have been reclassified as discontinued operations and are no longer included in professional contract staffing services.
Previous report — wording carried elsewhere
Cost of contract services includes wages and related payroll taxes and employee benefits of our contract services employees, and certain other contract employee-related costs, while working on contract assignments. Cost of contract services for the nine months ended June 30, 2025 decreased by approximately 11% to $48,076 compared to $53,816 for the nine months ended June 30, 2024. The $5,740 overall decrease in cost of contract services is consistent with the decrease in revenues as discussed above.
Previous report — wording carried elsewhere
Our combined gross profit margin, including direct hire placement services, for the nine-month periods ended June 30, 2025 and 2024 were approximately 34.2% and 33.4%, respectively. Our professional contract staffing services gross margins were 25.2% for both nine-month periods ended June 30, 2025 and 2024. The net increase in our combined gross margin is mainly attributable to an increase in the mix of direct hire placement revenues, which have a 100% gross margin.
Previous report — wording carried elsewhere
Selling, general and administrative expenses include the following categories:
Previous report — wording carried elsewhere
Interest income earned was $434 and $548 for the nine-month periods ended June 30, 2025 and 2024, respectively. Interest income is earned on cash balances held in our two brokerage accounts.