Resources Connection, Inc. (NASDAQ: RGP) Q1 2026 Earnings Call | 10/09/2025

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Resources Connection, Inc. reported Q1 2026 revenue of $120.2 million, representing a 12.2% year-over-year decline primarily due to macroeconomic headwinds and soft demand in U.S. markets. Despite the revenue contraction, gross margins expanded significantly to 39.5%, driven by higher consultant utilization, an improved pay/bill ratio, and reduced healthcare expenses. The company reduced SG&A expenses by 7% excluding a prior-year one-time gain, contributing to improved operational efficiency. Net loss narrowed sharply to $2.4 million, improving 57.9% compared to the prior year, and adjusted diluted EPS beat analyst forecasts at $0.03. Growth in the Outsourced Services segment, especially in artificial intelligence, fintech, and recent divestitures, supported a 4% increase in revenues, while consulting and On-Demand Talent segments experienced declines. Geographic performance was stronger in Europe and Asia-Pacific, with respective revenue growth of 5%. Resources Connection maintains a strong balance sheet with $77.5 million in cash and no debt, and anticipates annual cost savings of $6–$8 million through workforce reductions. Looking ahead, Q2 guidance projects revenues between $115 million and $120 million with gross margins expected between 38% and 39%. Management remains focused on advancing CFO advisory, digital transformation, and client-centric solutions to drive growth in an evolving global economic landscape. Ongoing uncertainties may pose challenges, but the company's diversified revenue model and disciplined cost management provide a solid foundation for long-term resilience. About Inside Ticker: Inside Ticker delivers clear, timely, and professional coverage of earnings reports, market updates, and financial insights. Stay informed with expert analysis at https://www.insideticker.com/. HashTags: #ResourcesConnection #RGP #q12026 #earnings #financialresults #revenue #netincome #eps #grossmargin #sga #adjustedeps #OutsourcedServices #ai #fintech #consulting #OnDemandTalent #europe #asiapacific #costsavings #workforcereduction #balancesheets #digitaltransformation #CFOAdvisory #professionalservices #investorupdate #stockmarket #insideticker #quarterlyresults #marginexpansion #operationalefficiency #businessgrowth