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$RHI Q3 2026 earnings: Robert Half staffing sales grow again, while cost cuts lift profit Robert Half's core staffing business grew again after a four-year slump, while its Protiviti consulting division shrank less than feared. Chief executive M. Keith Waddell said staffing sales rose 2% on a same-day constant-currency basis, lifting profit per share by 14% to $0.49. Cost cuts made in the spring also restored Protiviti's operating margin to 8%, near the top of the company's own plan. • Total revenue (same-day constant-currency): -𝟎.𝟐% (reported revenue $1.359B, +0.4% from a year ago) • Talent solutions revenue (same-day constant-currency): +𝟏.𝟔% (first growth since 2022 (-1.5% in Q2)) • Protiviti consulting operating margin, excluding one-offs: 𝟕.𝟕% (up from 2.1% in Q2 (target: 6% to 8%)) • Profit per share: $𝟎.𝟒𝟗 (+14% from a year ago (target: $0.43 to $0.53)) ⚖️ 𝐕𝐞𝐫𝐝𝐢𝐜𝐭: 🟢 Bullish The story got better because temporary contract staffing joined permanent hiring in returning to growth, and the promised $11 million in quarterly consulting cost savings arrived without new severance charges. One caution: Protiviti beating its lowered sales plan shows the target was cautious, not that the US bank regulatory slump is over, and nine-month dividends exceeded cash generation before financing by $133 million by our math. The question now is whether rising staffing sales reflect clients buying more hours of work or just paying higher hourly rates against an easy comparison. If hours worked are rising, a durable staffing recovery is underway; if hours are still falling, higher prices and cost cuts are doing the work. The third-quarter 10-Q filing's breakdown of contract hours and the fourth-quarter outlook on the conference call will tell. Full article with charts - link in bio 🐂 𝐁𝐮𝐥𝐥 𝐂𝐚𝐬𝐞 🟢🟢 𝐒𝐭𝐚𝐟𝐟𝐢𝐧𝐠 𝐆𝐫𝐞𝐰 𝐟𝐨𝐫 𝐭𝐡𝐞 𝐅𝐢𝐫𝐬𝐭 𝐓𝐢𝐦𝐞 𝐒𝐢𝐧𝐜𝐞 𝟐𝟎𝟐𝟐 Talent solutions is Robert Half's core staffing business, placing both temporary contract workers and full-time employees. "Talent solutions returned to adjusted year-over-year revenue growth for the first time since 2022, with revenues increasing 2 percent," chief executive M. Keith Waddell said. After stripping out billing-day and currency shifts, segment sales rose 1.6% from a year ago, reversing a 1.5% decline in the second quarter. • Permanent placement sales: up 5.6% from a year ago on a same-day constant-currency basis, up from 2.5% growth last quarter • Contract staffing sales: up 1.0% on the same basis, flipping from a 2.1% drop in the second quarter • Finance and accounting contract sales: up 1.5% on the same basis, after falling 1.3% last quarter • Talent solutions gross margin: 47.4%, up 0.7 percentage points from a year ago as cost of services fell This matters because permanent placement is the staffing line most sensitive to the economy, and temporary contract work has now followed it into growth. Still, total talent solutions growth of 1.6% landed near the bottom of the company's 1% to 5% target range, and comparisons against last year's slump were easy. What to watch: fourth-quarter staffing revenue growth in the conference call remarks and quarterly filing. Holding positive growth despite fewer fourth-quarter billing days would show client hiring is building real momentum. 🟢 𝐂𝐨𝐬𝐭 𝐂𝐮𝐭𝐬 𝐑𝐞𝐬𝐭𝐨𝐫𝐞𝐝 𝐂𝐨𝐧𝐬𝐮𝐥𝐭𝐢𝐧𝐠 𝐏𝐫𝐨𝐟𝐢𝐭 𝐌𝐚𝐫𝐠𝐢𝐧𝐬 Protiviti is Robert Half's business consulting arm, advising clients on internal audit, risk and technology. In the second quarter, a $7 million severance charge and lower billing hours pushed Protiviti's operating margin, excluding deferred-compensation trust swings, down to 2.1%. Management promised those staff cuts would save $45 million a year, or about $11 million a quarter, starting in the third quarter. The savings showed up on schedule. Protiviti's operating margin, excluding trust swings, rebounded to 7.7% in the third quarter, landing near the top of the firm's 6% to 8% target range and up 0.2 percentage points from a year ago. Costs of services — the direct cost of paying consultants — fell by 1.1 percentage points of segment revenue from a year ago, lifting gross margin to 24.1%, though selling and overhead costs rose 0.9 percentage points to 16.4%. What to watch: Protiviti's fourth-quarter operating margin target on the conference call. Maintaining margins near 7% during a seasonally slower fourth quarter would show the cost structure fits the smaller project mix. 🟢 𝐓𝐞𝐜𝐡𝐧𝐨𝐥𝐨𝐠𝐲 𝐒𝐭𝐚𝐟𝐟𝐢𝐧𝐠 𝐀𝐜𝐜𝐞𝐥𝐞𝐫𝐚𝐭𝐞𝐝 𝐀𝐜𝐫𝐨𝐬𝐬 𝐭𝐡𝐞 𝐁𝐮𝐬𝐢𝐧𝐞𝐬𝐬 Robert Half's technology practice places contract software developers, systems analysts and IT support specialists with clients. While other staffing lines shrank earlier in the year, technology was the first specialization to stabilize and now leads the recovery. In the third quarter, technology contract revenue rose 4.6% as reported to $165.1 million. On a same-day constant-currency basis, growth accelerated to 3.9%, up from 2.3% in the second quarter and a 0.3% decline in the first quarter. Because IT placements carry higher hourly bill rates than clerical roles, faster technology growth also supports overall staffing gross margins. What to watch: technology consulting revenue details in the quarterly filing. Continued acceleration in both contract IT placement and technology consulting would confirm client IT budgets are loosening. 🐻 𝐁𝐞𝐚𝐫 𝐂𝐚𝐬𝐞 🔴🔴 𝐂𝐨𝐧𝐬𝐮𝐥𝐭𝐢𝐧𝐠 𝐒𝐚𝐥𝐞𝐬 𝐒𝐭𝐢𝐥𝐥 𝐒𝐡𝐫𝐚𝐧𝐤 𝐃𝐞𝐬𝐩𝐢𝐭𝐞 𝐄𝐚𝐬𝐢𝐞𝐫 𝐓𝐚𝐫𝐠𝐞𝐭𝐬 "Demand for risk and compliance consulting services also showed encouraging signs of improvement during the quarter," Waddell said. Protiviti has struggled for a year because big US banks scaled back large regulatory compliance projects under the current administration. Last quarter, management set a low bar for the third quarter, forecasting Protiviti sales to fall 4% to 8% on a same-day constant-currency basis. Protiviti beat that lowered target, with sales down 3.3% on a same-day constant-currency basis (down 2.9% as reported to $483.5 million), and up by our math from $471.0 million last quarter. Under Rule 6, beating a lowered target shows the outlook was cautious, not that the regulatory slump is over. In the United States, where Protiviti earns most of its money, consulting revenue still fell 4.5% on a same-day basis, marking a fifth straight quarter of contraction. What to watch: the revenue and growth rate of Protiviti's risk and compliance practice on the conference call. Until US Protiviti sales stop falling from a year ago, the shift toward smaller, shorter projects remains a drag on the firm. 🔴 𝐃𝐢𝐯𝐢𝐝𝐞𝐧𝐝𝐬 𝐃𝐫𝐚𝐢𝐧𝐞𝐝 𝐂𝐚𝐬𝐡 𝐚𝐧𝐝 𝐇𝐚𝐥𝐭𝐞𝐝 𝐒𝐭𝐨𝐜𝐤 𝐁𝐮𝐲𝐛𝐚𝐜𝐤𝐬 Robert Half prioritises its quarterly dividend over open-market stock buybacks and refuses to borrow money to fund capital returns. During the first nine months of 2026, cash generated before financing activities fell 37% from a year ago to $47.1 million, while dividend payments totaled $179.8 million. By our math, dividends exceeded cash generation before financing by $132.7 million over the nine months. That shortfall came out of the cash balance, which dropped to $321.3 million from $464.4 million at the end of 2025. Because the dividend consumed all available cash flow, nine-month stock buybacks plunged to $6.8 million (about $0.7 million in the third quarter by our math, mainly for employee tax withholding) from $92.1 million a year earlier. What to watch: operating cash flow in the third-quarter 10-Q filing. Until quarterly cash generation covers the roughly $60 million quarterly dividend, open-market share buybacks will stay near zero. 🔴 𝐑𝐢𝐬𝐤𝐬 𝐭𝐡𝐢𝐬 𝐪𝐮𝐚𝐫𝐭𝐞𝐫 𝐝𝐢𝐝𝐧'𝐭 𝐚𝐧𝐬𝐰𝐞𝐫 The earnings release confirmed that administrative and customer support staffing kept shrinking — down 3.1% on a same-day constant-currency basis — while leaving five standing risks to be checked in the conference call remarks and 10-Q filing. • Contract hours worked vs bill rates: not in the release; the 10-Q filing will show whether staffing growth came from more hours worked or higher hourly prices. • Gentry California wage lawsuit: a court hearing on a permanent injunction requiring paid candidate interviews was scheduled for September 24, 2026; the 10-Q legal footnote will disclose the outcome. • AI displacement of clerical and professional roles: listed again as a risk factor in the release, while Administrative and Customer Support revenue fell 3.1% adjusted. • Fourth-quarter calendar headwind: the fourth quarter has 61.1 billing days versus 64.6 in the third quarter, including an extra lost day management previously sized at $20 million of revenue. • Macroeconomic sensitivity: Waddell noted "gradually improving market conditions", but small-business clients remain vulnerable to any economic slowdown. 👓 𝐎𝐭𝐡𝐞𝐫 𝐓𝐡𝐞𝐦𝐞𝐬 𝐃𝐞𝐟𝐞𝐫𝐫𝐞𝐝 𝐂𝐨𝐦𝐩𝐞𝐧𝐬𝐚𝐭𝐢𝐨𝐧 𝐀𝐜𝐜𝐨𝐮𝐧𝐭𝐢𝐧𝐠 𝐒𝐰𝐮𝐧𝐠 𝐑𝐞𝐩𝐨𝐫𝐭𝐞𝐝 𝐏𝐫𝐨𝐟𝐢𝐭 Under accounting rules, Robert Half records changes in what it owes employees under deferred compensation plans inside operating costs, while booking the offsetting gains or losses on the trust investments separately below operating income. In the third quarter, trust investments lost $2.3 million versus a $47.6 million gain a year ago, making reported operating income jump 451% to $74.8 million while operating income excluding trust swings rose 18.5% to $72.6 million. — • — • — 💲 𝐎𝐭𝐡𝐞𝐫 𝐊𝐏𝐈𝐬 𝐀𝐜𝐜𝐨𝐮𝐧𝐭𝐬 𝐫𝐞𝐜𝐞𝐢𝐯𝐚𝐛𝐥𝐞, 𝐧𝐞𝐭 (𝟐𝟔𝐐𝟑): $𝟖𝟐𝟔.𝟐 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇘ decelerating Money owed by clients for staffing and consulting services fell 1.4% from a year ago, even as reported revenue edged up 0.4%. Receivables rose 0.6% from the second quarter's $821.4 million as third-quarter billing activity picked up, showing healthy cash collection from clients. 𝐂𝐚𝐩𝐢𝐭𝐚𝐥 𝐞𝐱𝐩𝐞𝐧𝐝𝐢𝐭𝐮𝐫𝐞𝐬 𝐚𝐧𝐝 𝐜𝐥𝐨𝐮𝐝 𝐜𝐨𝐬𝐭𝐬 (𝟐𝟔𝐐𝟑): $𝟏𝟓.𝟎 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇘ decelerating Spending on property and cloud computing software totaled $46.9 million for the first nine months of 2026, down 24.7% from $62.2 million a year ago. By our math, subtracting first-half spending of $31.8 million leaves $15.0 million in the third quarter, right on the middle of management's $10 million to $20 million plan. 𝐃𝐢𝐥𝐮𝐭𝐞𝐝 𝐬𝐡𝐚𝐫𝐞 𝐜𝐨𝐮𝐧𝐭 (𝟐𝟔𝐐𝟑): 𝟏𝟎𝟎.𝟗 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇗ accelerating The diluted share count rose 0.9% from 100.0 million a year ago and increased from 100.3 million in the second quarter. Because the recruiter halted open-market share buybacks to preserve cash for its dividend, employee stock grants slightly increased the total share count. — • — • — ❓ 𝐊𝐞𝐲 𝐐𝐮𝐞𝐬𝐭𝐢𝐨𝐧𝐬 𝐃𝐢𝐝 𝐜𝐨𝐧𝐭𝐫𝐚𝐜𝐭 𝐬𝐭𝐚𝐟𝐟𝐢𝐧𝐠 𝐡𝐨𝐮𝐫𝐬 𝐠𝐫𝐨𝐰 𝐢𝐧 𝐭𝐡𝐞 𝐭𝐡𝐢𝐫𝐝 𝐪𝐮𝐚𝐫𝐭𝐞𝐫? Contract staffing revenue rose 1.0% on a same-day constant-currency basis, but the release does not split hours worked from hourly bill rates. Last quarter, hours worked fell 2.8% while bill rates carried the revenue. 𝐖𝐡𝐚𝐭 𝐝𝐢𝐝 𝐭𝐡𝐞 𝐜𝐨𝐮𝐫𝐭 𝐫𝐮𝐥𝐞 𝐚𝐭 𝐭𝐡𝐞 𝐆𝐞𝐧𝐭𝐫𝐲 𝐡𝐞𝐚𝐫𝐢𝐧𝐠? A California court held a hearing on September 24, 2026 on a motion to require Robert Half to pay temporary candidates for interview time. The release did not mention the outcome or its cost. 𝐖𝐡𝐚𝐭 𝐢𝐬 𝐭𝐡𝐞 𝐟𝐨𝐮𝐫𝐭𝐡-𝐪𝐮𝐚𝐫𝐭𝐞𝐫 𝐫𝐞𝐯𝐞𝐧𝐮𝐞 𝐚𝐧𝐝 𝐩𝐫𝐨𝐟𝐢𝐭 𝐨𝐮𝐭𝐥𝐨𝐨𝐤? Robert Half gives its quarterly outlook on the conference call rather than in the earnings release. With 5% fewer billing days in the fourth quarter, investors need the target range to gauge underlying demand. 𝐃𝐢𝐝 𝐔𝐒 𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥-𝐬𝐞𝐫𝐯𝐢𝐜𝐞𝐬 𝐜𝐨𝐧𝐬𝐮𝐥𝐭𝐢𝐧𝐠 𝐬𝐡𝐫𝐢𝐧𝐤 𝐚𝐠𝐚𝐢𝐧? Waddell noted encouraging signs in risk and compliance consulting, yet US Protiviti revenue still fell 4.5% on a same-day basis. Management has not disclosed the exact revenue or growth rate of the risk practice.