What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-08-06 compared with 2026-05-07 · 119 added, 80 removed, 110 unchanged (64% of the section changed)

1 unchanged sentence

Executive Overview

In the first quarter, we achieved results that were in line with our expectations, reflecting our ongoing focus on stabilizing the business.

In ETM, revenue trends improved sequentially from the fourth quarter, driven by growth in Talent Solutions across the MSP, RPO, and PPO offerings.

In SET, we delivered another quarter of year-over-year growth in our Telecom specialty, and Science & Clinical improved sequentially.

In Education, we continued to experience pressure from delayed contract decisions, enrollment declines, and elevated weather-related school closures.

Our results continue to reflect reduced volumes in parts of our portfolio driven by lower demand among certain large customers and a more measured approach to hiring among employers in some sectors, primarily in response to the dynamic macroeconomic environment.

The impact of demand reductions among three large customers, which we disclosed in the second quarter of 2025, remains visible in the results of ETM.

Staffing volumes in SET associated with the U.S.

federal government, which were materially reduced beginning in the first quarter of 2025 as a result of government efficiency actions, were stable.

Throughout the first quarter, we continued to align resources with demand to address these dynamics and maintained a disciplined approach to expense management overall as part of our ongoing focus on efficiency.

With trends stabilizing across the enterprise, we continued to execute strategic initiatives designed to drive organic growth and margin expansion.

These include the formation of a Growth Office which has collaborated across the enterprise to lay the foundation for an integrated commercial operating framework.

This framework unifies our go-to-market strategy, bringing our full suite of solutions to customers and increasing share of wallet and revenue growth.

We remained on track with our technology modernization initiative in the quarter, facilitating a smooth transition following the cutover of our acquisitions in SET from their legacy technology stack to the modernized platform we acquired through our acquisition of MRP.

The learnings from the initial cutover are being applied to subsequent phases to ensure we fully realize the growth and efficiency benefits of the new technology stack.

Our ability to stabilize the business while driving progress on our strategic initiatives in the first quarter reflects our enhanced focus on execution and operational discipline.

As demand trends improve, our progress will position us to capitalize, driving profitable growth and long-term value creation.

In the second quarter, we delivered sequential improvement in each business across Kelly.

The discrete impact of demand reductions among three large ETM customers and the U.S.

federal government, which we initially disclosed in the second quarter of 2025, is lessening but remains visible in our results.

Trends among these customers who continue to do business with Kelly remained stable on a sequential basis.

In ETM, staffing revenue excluding the discrete impacts returned to positive year-over-year growth driven by broad-based demand across customers and verticals, Business Process Outsourcing excluding contact center solutions also pivoted to growth in the quarter and Talent Solutions delivered another quarter of revenue growth as new customer wins came online and demand continued to increase.

In SET, trends in each specialty vertical improved compared to the first quarter, with the Telecom specialty delivering another quarter of year-over-year growth.

In Education, results improved modestly on a sequential basis while we continued to experience pressure from prior year delayed contract decisions and enrollment declines.

In each business, we continued to align resources with demand and maintained a disciplined approach to expense management overall as part of our ongoing focus on efficiency.

Our ability to deliver sequential improvement across the enterprise while driving progress on our strategic initiatives in the second quarter reflects our enhanced focus on execution and operational discipline.

Our progress will position us to capitalize on improving demand trends, and driving profitable growth and long-term value creation.

Financial Measures

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DSO is calculated by dividing average net sales per day (based on a rolling three-month period) into trade accounts receivable, net of allowances at period end.

Although secondary supplier revenues are recorded on a net basis (net of secondary supplier expense), secondary supplier revenue is included in the daily sales calculation in order to properly reflect the gross revenue amounts billed to the customer.

Where secondary supplier revenues are recorded on a net basis (net of secondary supplier expense), secondary supplier revenue is included in the daily sales calculation in order to properly reflect the gross revenue amounts billed to the customer.

NM (not meaningful) in the following tables is used in place of percentage changes where:

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(in millions)

First Quarter

2026 2025 % Change

Second Quarter June Year-to-Date

2026 2025 % Change 2026 2025 % Change

Revenue from services $ 1,038.2 $ 1,101.8 (5.8)% $ 2,078.9 $ 2,266.7 (8.3)%

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Total SG&A expenses 195.9 207.3 (5.5) 395.2 433.0 (8.7)

Asset impairment charge 2.2 — NM

Earnings (loss) from operations (5.1) 10.8 NM

Gain on sale of EMEA staffing operations — (4.0) NM — (4.0) NM

Asset impairment charge — — NM 2.2 — NM

Earnings from operations 16.1 22.2 (27.5) 11.0 33.0 (66.7)

Other income (expense), net (1.7) (2.3) 26.1 (3.3) (5.5) 40.0

Earnings (loss) before taxes (6.7) 7.6 NM

Income tax expense (benefit) (0.8) 1.8 (144.4)

Net earnings (loss) $ (5.9) $ 5.8 NM

Gross profit rate 18.9 % 20.3 % (1.4)%

First Quarter Results

Revenue from services in the first quarter decreased 10.7% year-over-year with decreases in the ETM, SET, and Education segments.

Compared to the first quarter of 2025, revenue from staffing services and outcome-based services decreased 12.9% and 9.7%, respectively.

Revenue from talent solutions increased 3.0% and permanent placement revenue decreased 5.2% from the prior year.

Earnings before taxes 14.4 19.9 (27.6) 7.7 27.5 (72.0)

Income tax expense 3.0 0.9 233.3 2.2 2.7 (18.5)

Net earnings $ 11.4 $ 19.0 (40.0)% $ 5.5 $ 24.8 (77.8)%

Gross profit rate 20.4 % 20.5 % (0.1) pts.

19.6 % 20.4 % (0.8) pts.

Second Quarter Results

Revenue from services in the second quarter decreased 5.8% year-over-year with decreases in the ETM, SET, and Education segments.

Compared to the second quarter of 2025, the decrease is primarily due to declines in revenue from staffing services of 9.5%, partially offset by increases in revenue from talent solutions of 6.3% from the prior year.

Gross profit decreased 6.0% year-over-year, primarily driven by lower revenue volume.

The gross profit rate decreased 1.4% to 18.9%, primarily due to higher employee-related costs in the beginning part of the year.

The gross profit rate decreased 10 basis points (“bps”) to 20.4%, primarily due to changes in business mix, partially offset by lower employee-related costs.

The gross profit rate decreased in the SET and Education segments and increased in the ETM segment.

Total SG&A expenses decreased 5.5% year-over-year, primarily due to expense management actions to reduce volume-related costs, and reflects the benefits of the ongoing structural actions including integration and realignment efforts.

SG&A expenses in the first quarter of 2026 include $4.7 million of integration and realignment costs related to continuation of ongoing initiatives, $1.5 million of executive transition charges and $0.8 million of transaction costs primarily related to costs incurred in connection with our controlling shareholder change in the first quarter of 2026.

Included in SG&A expenses in the first quarter of 2025 were $10.7 million of integration and realignment costs related to initiatives to integrate MRP and align our processes and $0.3 million of executive transition charges and $0.3 million of transaction-related costs arising from the sale of our EMEA staffing operations.

SG&A expenses in the second quarter of 2026 include $2.9 million of integration and realignment costs related to continuation of ongoing initiatives and $0.3 million of executive transition charges.

Included in SG&A expenses in the second quarter of 2025 were $6.0 million of integration and realignment costs related to initiatives to integrate MRP and align our processes, $0.2 million of executive transition charges, and $0.1 million of transaction-related costs arising from the sale of our EMEA staffing operations.

Excluding integration and realignment, transaction, executive transition charges, and depreciation and amortization, SG&A expenses decreased 4.0% from the prior year.

The gain on sale of EMEA staffing operations relates to the January 2024 sale.

In the second quarter of 2025, we recognized a gain of $4.0 million upon the settlement of working capital and other adjustments.

Income tax expense was $3.0 million for the second quarter of 2026 compared to income tax expense of $0.9 million for the second quarter of 2025, driven by changes in pretax income and the benefit of work opportunity tax credits in the second quarter of 2025.

June Year-to-Date Results

Revenue from services June year-to-date 2026 decreased 8.3% year-over-year with decreases in the ETM, SET, and Education segments.

Compared to the June year-to-date 2025, the decrease is primarily due to declines in revenue from staffing services

and outcome-based services of 11.2% and 5.0%, respectively, partially offset by growth in revenue from talent solutions of 4.7%.

Gross profit decreased 11.6%, largely driven by lower revenue volume.

The gross profit rate decreased 80 bps to 19.6%, primarily due to higher employee-related costs in the beginning part of the year.

Total SG&A expenses decreased 8.7%, primarily due to expense management actions to reduce volume-related costs and reflects the benefits of the ongoing structural actions including integration and realignment efforts.

SG&A expenses in the first six months of 2026 include $7.6 million of integration and realignment costs related to continuation of ongoing initiatives, $1.8 million of executive transition charges and $0.8 million of transaction costs primarily related to costs incurred in connection with our controlling shareholder change in the first quarter of 2026.

Included in SG&A expenses in the first six months of 2025 were $16.7 million of integration costs related to initiatives to integrate MRP and align our processes, $0.5 million of executive transition charges and $0.4 million of transaction costs related to the sale of our EMEA staffing operations.

The asset impairment charge of $2.2 million in the first quarter of 2026 relates to certain right-of-use assets and reflects our ongoing realignment of our lease portfolio.

Income tax benefit was $0.8 million for the first quarter of 2026 compared to income tax expense of $1.8 million for the first quarter of 2025, driven by changes in pretax income and the benefit of work opportunity tax credits in the first quarter of 2025.

The gain on sale of EMEA staffing operations relates to the January 2024 sale.

In the first six months of 2025, we recognized a gain of $4.0 million upon the settlement of working capital and other adjustments.

Income tax expense was $2.2 million for the first six months of 2026 compared to income tax expense of $2.7 million for the first six months of 2025, with the change primarily driven by changes in pretax income and the benefit of work opportunity tax credits in the first six months of 2025.

Operating Results By Segment

(in millions)

First Quarter

2026 2025 % Change

Second Quarter June Year-to-Date

2026 2025 % Change 2026 2025 % Change

Revenue from Services:

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Consolidated Total $ 1,038.2 $ 1,101.8 (5.8)% $ 2,078.9 $ 2,266.7 (8.3)%

First Quarter Results

Second Quarter Results

The decrease in ETM revenue from services of 6.0% was primarily driven by a decrease of 10.0% in staffing services resulting from lower hours volume primarily at certain large customers and a decrease of 9.3% from outcome-based services primarily due to the relationship exit of a large contact-center customer that ended as of the third quarter of 2025.

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federal government contractors and IT services, partially offset by an increase in permanent placement fees.

The decrease in Education revenue from services of 4.8% was driven primarily by the impact of delayed contract decisions, weather-related school closures and a reduction in demand in key markets due to declines in student enrollment.

First Quarter

2026 2025 % Change

The decrease in Education revenue from services of 4.4% was driven primarily by a reduction in demand in key markets due to declines in student enrollment.

June Year-to-Date Results

The decrease in ETM revenue from services of 9.6% was primarily driven by a decrease of 13.5% in staffing services resulting from lower hours volume primarily at certain large customers and a decrease of 14.8% from outcome-based services primarily due to the relationship exit of a large contact-center customer that ended as of the third quarter of 2025.

Permanent placement fees decreased 32.7%, reflecting lower market demand.

These decreases were partially offset by an increase of 4.7% in talent solutions driven by new customer wins and volume increases.

The decrease in SET revenue from services of 8.9% was primarily driven by declines in hours volume in our staffing specialties, largely from changes in demand related to U.S.

federal government contractors and IT services, partially offset by an increase in permanent placement fees.

The decrease in Education revenue from services of 4.6% was driven primarily by the impact of prior year delayed contract decisions, weather-related school closures and a reduction in demand in key markets due to declines in student enrollment.

Operating Results By Segment (continued)

(in millions)

Second Quarter June Year-to-Date

2026 2025 Change 2026 2025 Change

Gross Profit:

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Gross Profit Rate:

Enterprise Talent Management 18.6 % 20.3 % (1.7)%

Enterprise Talent Management 20.5 % 20.0 % 0.5 pts.

19.6 % 20.1 % (0.5) pts.

Science, Engineering & Technology 25.4 25.8 (0.4) 25.1 25.6 (0.5)

Education 14.2 14.7 (0.5) 13.7 14.9 (1.2)

Consolidated Total 18.9 % 20.3 % (1.4)%

First Quarter Results

Consolidated Total 20.4 % 20.5 % (0.1) pts.

19.6 % 20.4 % (0.8) pts.

Second Quarter Results

Gross profit for ETM decreased on lower revenue volume.

The gross profit rate decreased by 1.7% primarily due to higher employee-related costs and lower permanent placement fees, partially offset by favorable changes in business mix.

The gross profit rate increased by 50 bps primarily due to lower employee-related costs, partially offset by lower permanent placement fees.

The SET gross profit decreased on lower revenue volume.

The gross profit rate decreased by 0.6% primarily due to higher employee-related costs, partially offset by higher permanent placement fees.

The gross profit rate decreased by 40 bps primarily due to changes in business mix, partially offset by lower employee-related costs and higher permanent placement fees.

Gross profit for the Education segment decreased on lower revenue volume.

The gross profit rate decreased by 1.7%, primarily due to higher employee-related costs as well as reductions due to changes in business mix and lower permanent placement fees.

The gross profit rate decreased by 50 bps, primarily due to higher employee-related costs and lower permanent placement fees.

June Year-to-Date Results

Gross profit for the ETM segment decreased on lower revenue volume.

The gross profit rate decreased by 50 bps primarily due to higher employee-related costs.

The SET gross profit decreased on lower revenue volume.

The gross profit rate decreased by 50 bps primarily due to changes in business mix and higher employee-related costs, partially offset by higher permanent placement fees.

Gross profit for the Education segment decreased on lower revenue volume.

The gross profit rate decreased by 120 bps primarily due to higher employee-related costs and lower permanent placement fees.

Operating Results By Segment (continued)

(in millions)

First Quarter

2026 2025 % Change

Second Quarter June Year-to-Date

2026 2025 % Change 2026 2025 % Change

SG&A Expenses (excluding depreciation and amortization):

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Consolidated Total $ 184.1 $ 194.8 (5.5)% $ 371.7 $ 407.7 (8.8)%

First Quarter Results

The 14.0% decrease in ETM SG&A expenses excluding depreciation and amortization was primarily due to lower salary-related costs, lower performance-based incentive compensation, and lower shared service costs as a result of operating efficiencies and expense management actions in response to lower revenue volume compared to the prior year.

Second Quarter Results

The 4.4% decrease in ETM SG&A expenses excluding depreciation and amortization was primarily due to lower salary-related costs as a result of operating efficiencies and expense management actions in response to lower revenue volume compared to the prior year.

The 7.8% decrease in SET SG&A expenses excluding depreciation and amortization was primarily due to lower salary-related costs as a result of operating efficiencies and expense management actions in response to lower revenue volume compared to the prior year.

The 0.8% decrease in Education SG&A expenses excluding depreciation and amortization primarily related to lower performance-based incentive compensation.

The 11.3% decrease in Corporate expenses was primarily driven by lower integration, realignment, and restructuring charges in the second quarter of 2026 as compared to the prior year.

June Year-to-Date Results

The 9.4% decrease in ETM SG&A expenses excluding depreciation and amortization was primarily due to lower salary-related costs and lower shared service costs as a result of operating efficiencies and expense management actions in response to lower revenue volume compared to the prior year.

The 12.4% decrease in SET SG&A expenses excluding depreciation and amortization was primarily due to lower salary-related costs and performance-based incentive compensation as a result of operating efficiencies and expense management actions in response to lower revenue volume compared to the prior year.

The 0.8% decrease in Education SG&A expenses excluding depreciation and amortization primarily related to lower performance-based incentive compensation.

The 3.1% increase in Corporate expenses was primarily driven by investment in the Growth Office and other corporate initiatives and increases in our nonqualified compensation plan expense, partially offset by lower integration, realignment, and restructuring charges and performance-based incentive compensation in the first quarter of 2026 as compared to the prior year.

First Quarter

2026 2025 % Change

Business Unit Profit (Loss)

Enterprise Talent Management $ (1.3) $ 6.3 NM

The 3.4% decrease in Corporate expenses was primarily driven by lower integration, realignment, and restructuring charges, partially offset by investment in the Growth Office and other corporate initiatives in the first six months of 2026 as compared to the prior year.

Operating Results By Segment (continued)

(in millions)

Second Quarter June Year-to-Date

2026 2025 % Change 2026 2025 % Change

Business Unit Profit

Enterprise Talent Management $ 10.8 $ 10.6 1.9% $ 9.5 $ 16.9 (43.8)%

Science, Engineering & Technology 18.2 19.8 (8.1) 30.2 33.7 (10.4)

Education 10.7 13.6 (21.3) 23.0 32.9 (30.1)

Business Unit Profit (Loss) 23.0 39.5 (41.8)

Business unit profit 39.7 44.0 (9.8) 62.7 83.5 (24.9)

Corporate (11.8) (13.3) (11.3) (28.2) (29.2) (3.4)

Gain on sale of EMEA staffing operations — 4.0 NM — 4.0 NM

Depreciation and amortization (11.8) (12.5) (5.6) (23.5) (25.3) (7.1)

Consolidated total earnings (loss) from operations $ (5.1) $ 10.8 NM

First Quarter Results

ETM reported a loss of $1.3 million compared to profit of $6.3 million in the prior year.

SET and Education reported profit of $12.0 million and $12.3 million, respectively, which decreased compared to the prior year.

Declines in business unit profit (loss) are primarily due to lower revenue and gross profit, partially offset by lower SG&A expenses.

Consolidated total earnings from operations $ 16.1 $ 22.2 (27.5)% $ 11.0 $ 33.0 (66.7)%

Second Quarter Results

ETM business unit profit increased compared to the prior year due to lower SG&A expenses.

SET and Education business unit profit decreased compared to the prior year primarily due to lower revenue and gross profit, partially offset by lower SG&A expenses.

June Year-to-Date Results

ETM, SET, and Education business unit profit decreased compared to the prior year primarily due to lower revenue and gross profit, partially offset by lower SG&A expenses.

Financial Condition

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however, any such increase would not be sustainable in the event that an economic downturn continued for an extended period.

We also experience material seasonal fluctuations in working capital in our Education segment due to schools being mostly out of session during the summer.

As highlighted in the consolidated statements of cash flows, our liquidity and available capital resources are impacted by four key components:

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Cash, Cash Equivalents and Restricted Cash

Cash, cash equivalents and restricted cash totaled $29.5 million at the end of the first quarter of 2026 and $37.7 million at year-end 2025.

As further described below, we used $25.4 million of cash for operating activities, used $1.2 million of cash for investing activities and generated $24.2 million of cash from financing activities.

Cash, cash equivalents and restricted cash totaled $28.0 million at the end of the second quarter of 2026 and $37.7 million at year-end 2025.

As further described below, we generated $23.8 million of cash from operating activities, generated $0.2 million of cash from investing activities and used $31.2 million of cash for financing activities.

Operating Activities

In the first three months of 2026, we used $25.4 million of net cash for operating activities, as compared to generating $23.9 million in the first three months of 2025, primarily due to increased working capital requirements as compared to the same period of the prior year.

Trade accounts receivable totaled $1.2 billion at the end of the first quarter of 2026.

Global DSO was 64 days for the first quarter of 2026 and 61 days at year-end 2025.

Our working capital position (total current assets less total current liabilities) was $480.2 million at the end of the first quarter of 2026, an increase of $33.7 million from year-end 2025.

The current ratio (total current assets divided by total current liabilities) was 1.6 at the end of the first quarter of 2026 and 1.5 at year-end 2025.

In the first six months of 2026, we generated $23.8 million of net cash from operating activities, as compared to generating $119.3 million in the first six months of 2025.

The decrease was primarily due to higher working capital requirements as compared to the same period of the prior year.

Trade accounts receivable totaled $1.2 billion at the end of the second quarter of 2026.

Global DSO was 61 days at both second quarter-end 2026 and year-end 2025.

Our working capital position (total current assets less total current liabilities) was $429.9 million at the end of the second quarter of 2026, a decrease of $16.6 million from year-end 2025.

The current ratio (total current assets divided by total current liabilities) was 1.5 at the end of the second quarter of 2026 and 1.5 at year-end 2025.

Investing Activities

In the first three months of 2026, we used $1.2 million of cash for investing activities, as compared to generating $3.2 million in the first three months of 2025.

Cash used in investing activities in the first three months of 2026 is primarily driven by $1.1 million of capital expenditures.

Included in the cash generated for investing activities in the first three months of 2025 is $6.4 million of cash from the sale of PersolKelly investment, partially offset by $2.5 million of cash used for capital expenditures.

In the first six months of 2026, we generated $0.2 million of cash from investing activities, as compared to generating $24.7 million in the first six months of 2025.

Cash generated by investing activities in the first six months of 2026 is primarily driven by $2.7 million of proceeds from company-owned life insurance, partially offset by $2.6 million of capital expenditures.

Included in the cash generated by investing activities in the first six months of 2025 is $21.8 million of proceeds from the sale of our EMEA staffing operations, $6.4 million of cash from the sale of the PersolKelly investment and $1.6 million of proceeds from company-owned life insurance, partially offset by $4.5 million of cash used for capital expenditures.

Financing Activities

We generated $24.2 million of cash from financing activities in the first three months of 2026, as compared to using $39.5 million in the first three months of 2025.

The change in cash generated from financing activities was primarily driven by net proceeds of $28.6 million on our credit facilities in 2026 compared to net repayments of $34.8 million on our credit facilities in 2025.

Dividends paid per common share were $0.075 in each of the first quarters of 2026 and 2025.

We used $31.2 million of cash for financing activities in the first six months of 2026, as compared to using $172.7 million in the first six months of 2025.

The change in cash used from financing activities was primarily driven by lower net repayments of $23.8 million on our credit facilities in 2026 compared to net repayments of $165.1 million on our credit facilities in 2025.

Dividends paid per common share were $0.075 in each of the first two quarters of 2026 and 2025.

Debt-to-total capital (total debt reported in the consolidated balance sheet divided by total debt plus stockholders’ equity) is a common ratio to measure the relative capital structure and leverage of the Company.

Our ratio of debt-to-total capital was 11.9% at the end of the first quarter of 2026 and 9.4% at year-end 2025 .

Our ratio of debt-to-total capital was 7.4% at the end of the second quarter of 2026 and 9.4% at year-end 2025 .

Critical Accounting Estimates

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We expect our international cash will be needed to fund working capital growth in our local operations as working capital needs, primarily trade accounts receivable, increase during periods of growth.

As of first quarter-end 2026, we had $150.0 million of available capacity on our $150.0 million revolving credit facility and $76.9 million of available capacity on our $250.0 million securitization facility.

As of second quarter-end 2026, we had $150.0 million of available capacity on our $150.0 million revolving credit facility and $129.3 million of available capacity on our $250.0 million securitization facility.

The revolving credit facility carried no long-term borrowings on the floating or term benchmark lines of credit.

The securitization facility carried $78.1 million of long-term borrowings and $42.6 million of standby letters of credit related to workers’ compensation.

The credit facilities also include an accordion feature to increase our combined borrowing capacity by $250.0 million.

The credit facilities also include provisions that would allow for expansion of our combined borrowing capacity by $250.0 million.

Together, the revolving credit and securitization facilities provide us with committed funding capacity that may be used for general corporate purposes subject to financial covenants and restrictions.

We believe our cash flow from operations, the availability of liquidity under our credit facilities, including the accordion feature which allows us to increase our borrowing capacity and our ability to access capital from financial markets will be sufficient to meet our anticipated cash requirements, while maintaining sufficient liquidity for normal operating purposes.

As of first quarter-end 2026, we met the debt covenants related to our revolving credit facility and securitization facility.

As of first quarter-end of 2026, we had additional unsecured, uncommitted short-term local credit facilities totaling $3.1 million, under which we had no borrowings.

We believe our cash flow from operations, the availability of liquidity under our credit facilities, including the expansion provisions which allows us to increase our borrowing capacity and our ability to access capital from financial markets will be sufficient to meet our anticipated cash requirements, while maintaining sufficient liquidity for normal operating purposes.

As of second quarter-end 2026, we met the debt covenants related to our revolving credit facility and securitization facility.

As of second quarter-end of 2026, we had additional unsecured, uncommitted short-term local credit facilities totaling $3.1 million, under which we had no borrowings.

Details of our debt facilities are contained in the Debt footnote in the notes to our consolidated financial statements.

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Actual events and results may differ materially from those expressed or implied by forward-looking statements due to a number of factors.

The principal risk factors that could cause our actual performance and future events and actions to differ materially from such forward-looking statements include, but are not limited to, (i) changing market and economic conditions, (ii) disruption in the labor market and weakened demand for human capital resulting from technological advances, competitive pressures and pricing, loss of large corporate customers and government contractor requirements, (iii) the impact of laws and regulations (including federal, state and international tax laws), (iv) unexpected changes in claim trends on workers’ compensation, unemployment, disability and medical benefit plans, (v) litigation and other legal liabilities (including tax liabilities) in excess of our estimates, (vi) our ability to achieve our business's anticipated growth strategies, (vii) our future business development, results of operations and financial condition, (viii) damage to our brands, (ix) dependence on third parties for the execution of critical functions, (x) conducting business in foreign countries, including foreign currency fluctuations, (xi) availability of temporary workers with appropriate skills required by customers, (xii) cyberattacks or other breaches of network or information technology security, and (xiii) other risks, uncertainties and factors discussed in this report and in our other filings with the Securities and Exchange Commission, including those discussed under “Risk Factors” in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 28, 2025.

The principal risk factors that could cause our actual performance and future events and actions to differ materially from such forward-looking statements include, but are not limited to, (i) changing market and economic conditions, (ii) disruption in the labor market and weakened demand for human capital resulting from technological advances, competitive pressures and pricing, loss of large corporate customers and government contractor requirements, (iii) the impact of laws and regulations (including federal, state and international tax laws), (iv) unexpected changes in claim trends on workers’ compensation, unemployment, disability and medical benefit plans, (v) litigation and other legal liabilities (including tax liabilities) in excess of our estimates, (vi) our ability to achieve our business's anticipated growth strategies, (vii) our future business development, results of operations and financial condition, (viii) damage to our brands, (ix) dependence on third parties for the execution of critical functions, (x) conducting business in foreign countries, including foreign currency fluctuations, (xi) availability of temporary workers with appropriate skills required by customers, (xii) cyberattacks or other breaches of network or information technology security, and (xiii) other risks, uncertainties and factors discussed in this report and in our other filings with the Securities and Exchange Commission, including those discussed under “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 28, 2025.

Actual results may differ materially from any forward-looking statements contained herein, and we undertake no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis