What changed in this filing

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Item 1. Financial Statements

2025-11-04 compared with 2025-08-01 · 75 added, 87 removed, 341 unchanged (32% of the section changed)

Financial Statements

CONDENSED CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS

(in millions)

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Cash and cash equivalents $ 422 $ 1,039

36 unchanged sentences

See accompanying notes.

Insperity | 2025 Second Quarter Form 10-Q

Insperity | 2025 Third Quarter Form 10-Q

FINANCIAL STATEMENTS

1 unchanged sentence

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions, except per share amounts)

12 unchanged sentences

Operating income (loss) ( 25 ) 1 36 132

( 7 ) 23 61 131

Other income (expense):

2 unchanged sentences

Income (loss) before income tax (benefit) expense ( 24 ) 3 42 139

( 6 ) 25 66 136

Income tax (benefit) expense ( 4 ) — 16 39

( 1 ) 7 20 39

Net income (loss) $ ( 20 ) $ 3 $ 26 $ 100

$ ( 5 ) $ 18 $ 46 $ 97

Net income (loss) per share of common stock

2 unchanged sentences

See accompanying notes.

Insperity | 2025 Second Quarter Form 10-Q

Insperity | 2025 Third Quarter Form 10-Q

FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF CASH FLOWS

Six Months Ended June 30,

Nine Months Ended September 30,

(in millions)

1 unchanged sentence

Net income $ 26 $ 100

Adjustments to reconcile net income to net cash provided by operating activities:

Adjustments to reconcile net income to net cash used in operating activities:

Depreciation and amortization 33 33

14 unchanged sentences

Total adjustments ( 559 ) ( 199 )

Net cash provided by (used in) operating activities ( 522 ) 51

Net cash used in operating activities ( 533 ) ( 99 )

Cash flows from investing activities

2 unchanged sentences

Proceeds from maturities 17 17

Proceeds from dispositions 8 —

Property and equipment purchases ( 22 ) ( 25 )

12 unchanged sentences

See accompanying notes.

Insperity | 2025 Second Quarter Form 10-Q

Insperity | 2025 Third Quarter Form 10-Q

FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

For the Six Months Ended June 30, 2025 and 2024

For the Nine Months Ended September 30, 2025 and 2024

Common Stock Issued Additional Paid-In Capital Treasury Stock Retained Earnings and AOCI Total

7 unchanged sentences

Net income — — — — 26 26

Balance at June 30, 2025 55 $ 1 $ 228 $ ( 853 ) $ 736 $ 112

Balance at September 30, 2025 55 $ 1 $ 244 $ ( 852 ) $ 694 $ 87

Balance at December 31, 2023 55 $ 1 $ 185 $ ( 831 ) $ 739 $ 94

5 unchanged sentences

Net income — — — — 100 100

Balance at June 30, 2024 55 $ 1 $ 191 $ ( 838 ) $ 788 $ 142

Insperity | 2025 Second Quarter Form 10-Q

Balance at September 30, 2024 55 $ 1 $ 208 $ ( 853 ) $ 769 $ 125

Insperity | 2025 Third Quarter Form 10-Q

FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Continued)

For the Three Months Ended June 30, 2025 and 2024

For the Three Months Ended September 30, 2025 and 2024

Common Stock Issued Additional Paid-In Capital Treasury Stock Retained Earnings and AOCI Total

1 unchanged sentence

Shares Amount

Balance at March 31, 2025 55 $ 1 $ 209 $ ( 855 ) $ 764 $ 119

Issuance of equity-based incentive awards and dividend equivalents — — — 1 ( 1 ) —

Balance at June 30, 2025 55 $ 1 $ 228 $ ( 853 ) $ 736 $ 112

Stock-based compensation expense — — 16 — — 16

Other — — — 1 1 2

Dividends paid — — — — ( 23 ) ( 23 )

— — — — ( 5 ) ( 5 )

Net loss — — — — ( 20 ) ( 20 )

Balance at September 30, 2025 55 $ 1 $ 244 $ ( 852 ) $ 694 $ 87

Balance at June 30, 2024 55 $ 1 $ 191 $ ( 838 ) $ 788 $ 142

Balance at March 31, 2024 55 $ 1 $ 172 $ ( 826 ) $ 793 $ 140

Purchase of treasury stock, at cost — — — ( 15 ) — ( 15 )

Issuance of equity-based incentive awards and dividend equivalents — — — ( 1 ) 1 —

Stock-based compensation expense — — 17 — — 17

2 unchanged sentences

Net income — — — — 3 3

Balance at June 30, 2024 55 $ 1 $ 191 $ ( 838 ) $ 788 $ 142

Balance at September 30, 2024 55 $ 1 $ 208 $ ( 853 ) $ 769 $ 125

See accompanying notes.

Insperity | 2025 Second Quarter Form 10-Q

Insperity | 2025 Third Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

12 unchanged sentences

The accompanying Consolidated Financial Statements should be read in conjunction with our audited Consolidated Financial Statements at and for the year ended December 31, 2024.

Our Condensed Consolidated Balance Sheets at December 31, 2024 has been derived from the audited financial statements at that date, but does not include all of the information or footnotes required by GAAP for complete financial statements.

Our Condensed Consolidated Balance Sheets at June 30, 2025 and our Consolidated Statements of Income for the three and six month periods ended June 30, 2025 and 2024, our Consolidated Statements of Cash Flows for the six month periods ended June 30, 2025 and 2024 and our Consolidated Statements of Stockholders' Equity for each of the three and six month periods ended June 30, 2025 and 2024, have been prepared by us without audit.

Our Condensed Consolidated Balance Sheets at December 31, 2024 have been derived from the audited financial statements at that date, but do not include all of the information or footnotes required by GAAP for complete financial statements.

Our Condensed Consolidated Balance Sheets at September 30, 2025 and our Consolidated Statements of Income for the three and nine month periods ended September 30, 2025 and 2024, our Consolidated Statements of Cash Flows for the nine month periods ended September 30, 2025 and 2024 and our Consolidated Statements of Stockholders' Equity for each of the three and nine month periods ended September 30, 2025 and 2024, have been prepared by us without audit.

In the opinion of management, all adjustments necessary to present fairly the consolidated financial position, results of operations and cash flows have been made, and all such adjustments are of a normal recurring nature.

8 unchanged sentences

The estimated incurred but not reported claims are based upon:

Insperity | 2025 Second Quarter Form 10-Q

Insperity | 2025 Third Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

7 unchanged sentences

The terms of the arrangement require us to maintain an accumulated cash surplus in the plan of $ 9 million, which is reported as long-term prepaid health insurance.

In addition, United requires a deposit equal to approximately one day of claims funding activity, which was $ 7 million at June 30, 2025, and is included in deposits - health insurance as a long-term asset on our Condensed Consolidated Balance Sheets.

As of June 30, 2025, Plan Costs were less than the net premiums paid and owed to United by $ 35 million, which is $ 26 million in excess of our agreed-upon $ 9 million surplus maintenance level.

The $ 26 million difference is therefore reflected as a current asset and $ 9 million is reflected as a long-term asset on our Condensed Consolidated Balance Sheets at June 30, 2025.

In addition, the premiums owed to United at June 30, 2025, were $ 53 million, which is included in accrued health insurance costs, a current liability, on our Condensed Consolidated Balance Sheets.

Our benefits costs incurred in the first six months of 2025 included an increase of $ 11 million for changes in estimated run-off related to prior periods, net of Individual Claims Limit.

Our benefits costs incurred in the first six months of 2024 included a decrease of $ 26 million for changes in estimated run-off related to prior periods, net of Individual Claims Limit.

In addition, United requires a deposit equal to approximately one day of claims funding activity, which was $ 7 million at September 30, 2025, and is included in deposits - health insurance as a long-term asset on our Condensed Consolidated Balance Sheets.

As of September 30, 2025, Plan Costs were less than the net premiums paid and owed to United by $ 19 million, which is $ 10 million in excess of our agreed-upon $ 9 million surplus maintenance level.

The $ 10 million difference is therefore reflected as a current asset and $ 9 million is reflected as a long-term asset on our Condensed Consolidated Balance Sheets at September 30, 2025.

In addition, the premiums owed to United at September 30, 2025, were $ 26 million, which is included in accrued health insurance costs, a current liability, on our Condensed Consolidated Balance Sheets.

Our benefits costs incurred in the first nine months of 2025 included an increase of $ 9 million for changes in estimated run-off related to prior periods, net of Individual Claims Limit.

Our benefits costs incurred in the first nine months of 2024 included a decrease of $ 32 million for changes in estimated run-off related to prior periods, net of Individual Claims Limit.

Workers’ Compensation Costs

9 unchanged sentences

Each reporting period, changes in the actuarial assumptions resulting from changes in actual claims experience and other trends are incorporated into our workers’ compensation claims cost estimates.

During the six months ended June 30, 2025 and 2024, we reduced accrued workers’ compensation costs by $ 14 million and $ 17 million, respectively, for changes in estimated losses related to prior periods.

During the nine months ended September 30, 2025 and 2024, we reduced accrued workers’ compensation costs by $ 20 million and $ 25 million, respectively, for changes in estimated losses related to prior periods.

Workers’ compensation cost estimates are discounted to present value at a rate based upon the U.S.

Treasury rates that correspond with the weighted average estimated claim payout period (the average discount rate utilized was 4.0 % in the 2025 period and 4.3 % in the 2024 period) and are accreted over the estimated claim payment period and included as a component of direct costs in our Consolidated Statements of Income.

Insperity | 2025 Second Quarter Form 10-Q

Insperity | 2025 Third Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table provides the activity and balances related to incurred but not paid workers’ compensation claims:

Six Months Ended June 30,

Nine Months Ended September 30,

(in millions)

7 unchanged sentences

Total accrued claims $ 186 $ 207

The current portion of accrued workers’ compensation costs on our Condensed Consolidated Balance Sheets at June 30, 2025 and 2024 includes $ 3 million and $ 2 million, respectively, of workers’ compensation administrative fees.

The undiscounted accrued workers’ compensation costs were $ 228 million as of June 30, 2025 and $ 244 million as of June 30, 2024.

The current portion of accrued workers’ compensation costs on our Condensed Consolidated Balance Sheets at September 30, 2025 and 2024 includes $ 2 million and $ 3 million, respectively, of workers’ compensation administrative fees.

The undiscounted accrued workers’ compensation costs were $ 227 million as of September 30, 2025 and $ 242 million as of September 30, 2024.

At the beginning of each policy period, the workers’ compensation insurance carrier establishes monthly funding requirements comprised of premium costs and funds to be set aside for payment of future claims (“claim funds”).

1 unchanged sentence

Monies funded into the program for incurred claims expected to be paid within one year are primarily held as cash and money market funds (cash equivalents) and are recorded as restricted cash, a short-term asset, while the remainder of claim funds are included in deposits – workers’ compensation, a long-term asset in our Condensed Consolidated Balance Sheets.

At June 30, 2025, we had restricted cash of $ 76 million and deposits – workers’ compensation of $ 174 million, of which $ 243 million was held in trust bank accounts.

At September 30, 2025, we had restricted cash of $ 79 million and deposits – workers’ compensation of $ 147 million, of which $ 226 million was held in trust bank accounts.

Our estimate of incurred claim costs expected to be paid within one year is included in short-term liabilities, while our estimate of incurred claim costs expected to be paid beyond one year is included in long-term liabilities on our Condensed Consolidated Balance Sheets.

Revenue and Direct Cost Recognition

We enter into contracts with our customers for human resources services based on a stated rate and price in the contract.

We enter into contracts with our PEO HR Solutions customers for human resources services based on a stated rate and price in the contract.

Our contracts generally establish pricing for a period of 12 months and are generally cancellable at any time by either party with 30-days’ notice.

5 unchanged sentences

Customers are invoiced concurrently with each periodic payroll of its WSEEs.

Revenues that have been recognized but not invoiced represent unbilled accounts receivable of $ 829 million and $ 810 million at June 30, 2025 and December 31, 2024, respectively, and are included in accounts receivable, net on our Condensed Consolidated Balance Sheets.

Revenues that have been recognized but not invoiced represent unbilled accounts receivable of $ 882 million and $ 810 million at September 30, 2025 and December 31, 2024, respectively, and are included in accounts receivable, net on our Condensed Consolidated Balance Sheets.

Pursuant to the “practical expedients” provided under ASC 340-40, Other Assets and Deferred Costs - Contracts with Customers , we expense sales commissions when incurred because the terms of our contracts are cancellable by either party with a 30-day notice.

These costs are recorded in commissions in our Consolidated Statements of Income.

Insperity | 2025 Second Quarter Form 10-Q

Insperity | 2025 Third Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Our revenue for our PEO HR Solutions by geographic region and for our other products and services offerings are as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(in millions) 2025 2024 % Change 2025 2024 % Change

14 unchanged sentences

Revenues are comprised of gross billings less WSEE payroll costs as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(in millions) 2025 2024 2025 2024

8 unchanged sentences

The accounting policies of the HR Solutions segment are the same as those described in the summary of significant accounting policies.

The measure of segment assets is reported on our Condensed Consolidated Balance Sheets as total assets, and the chief operating decision maker (“CODM”) assesses performance and decides how to allocate resources based on net income as reported on our Consolidated Statements of Income.

The CODM reviews revenues and expenses at the consolidated level as disclosed in our Consolidated Statements of Income and uses net income to evaluate income generated from segment assets (return on assets) in deciding whether to reinvest profits into our HR Solutions segment or into other areas of the entity, such as for acquisitions or to pay dividends.

Insperity | 2025 Second Quarter Form 10-Q

Insperity | 2025 Third Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

4 unchanged sentences

The following table summarizes our cash and investments in cash equivalents and marketable securities held by investment managers and overnight investments:

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(in millions)

7 unchanged sentences

Our cash and overnight holdings fluctuate based on the timing of clients’ payroll processing cycles.

Our cash, cash equivalents and marketable securities at June 30, 2025 and December 31, 2024 included $ 316 million and $ 830 million, respectively, of funds associated with federal and state income tax withholdings, employment taxes, and other payroll deductions, as well as $ 26 million and $ 91 million, respectively, in client prepayments.

Our cash, cash equivalents and marketable securities at September 30, 2025 and December 31, 2024 included $ 284 million and $ 830 million, respectively, of funds associated with federal and state income tax withholdings, employment taxes, and other payroll deductions, as well as $ 36 million and $ 91 million, respectively, in client prepayments.

In addition, $ 440 million of client employee retention tax credits received on their behalf from the Internal Revenue Service during the fourth quarter of 2024 were distributed to clients in early 2025.

Insperity | 2025 Third Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Cash, Cash Equivalents, Restricted Cash, Funds Held for Clients, and Deposits - Workers’ Compensation

The following table summarizes our cash, cash equivalents, restricted cash, funds held for clients, and deposits - workers’ compensation as reported in our Consolidated Statements of Cash Flows:

Six Months Ended June 30,

Nine Months Ended September 30,

(in millions)

10 unchanged sentences

Cash, cash equivalents, restricted cash, funds held for clients, and deposits - workers’ compensation end of period $ 688 $ 748

Insperity | 2025 Second Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

____________________________________

9 unchanged sentences

• Level 3 - significant unobservable inputs

Insperity | 2025 Third Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Fair Value of Instruments Measured and Recognized at Fair Value

The following table summarizes the levels of fair value measurements of our financial assets:

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(in millions)

12 unchanged sentences

Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value

June 30, 2025

September 30, 2025

Treasury bills $ 18 $ — $ — $ 18

1 unchanged sentence

Treasury bills $ 16 $ — $ — $ 16

As of June 30, 2025, the contractual maturities of all marketable securities in our portfolio were less than one year.

Insperity | 2025 Second Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of September 30, 2025, the contractual maturities of all marketable securities in our portfolio were less than one year.

Fair Value of Other Financial Instruments

The carrying amounts of cash, cash equivalents, restricted cash, accounts receivable, deposits and accounts payable approximate their fair values due to the short-term maturities of these instruments.

As of June 30, 2025, the carrying value of borrowings under our revolving credit facility approximates fair value and was classified as Level 2 in the fair value hierarchy.

As of September 30, 2025, the carrying value of borrowings under our revolving credit facility approximates fair value and was classified as Level 2 in the fair value hierarchy.

Please read Note 5, “ Long-Term Debt ,” for additional information.

4 unchanged sentences

Our obligations under the Facility are secured by 100 % of the stock of our captive insurance subsidiary and are guaranteed by all of our subsidiaries other than our captive insurance subsidiary and certain other excluded subsidiaries.

At June 30, 2025, our outstanding balance on the Facility was $ 369 million, and we had an outstanding $ 1 million letter of credit issued under the Facility, resulting in an available borrowing capacity of $ 280 million.

At September 30, 2025, our outstanding balance on the Facility was $ 369 million, and we had an outstanding $ 1 million letter of credit issued under the Facility, resulting in an available borrowing capacity of $ 280 million.

The Facility matures on June 30, 2027 .

1 unchanged sentence

Adjusted Term SOFR is a forward-looking term rate based on the secured overnight financing rate plus a spread adjustment, which ranges from 0.10 % to 0.25 % depending on the interest period and type of loan.

Depending on our leverage ratio, the applicable margin varies (1) in the case of SOFR loans, from 1.50 % to 2.25 % and (2) in the case of alternate base rate loans, from 0.00 % to 0.50 %.

Depending on our leverage ratio, the applicable margin

Insperity | 2025 Third Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

varies (1) in the case of SOFR loans, from 1.50 % to 2.25 % and (2) in the case of alternate base rate loans, from 0.00 % to 0.50 %.

The alternate base rate is the highest of (1) the prime rate most recently published in The Wall Street Journal, (2) the federal funds rate plus 0.50 %;

1 unchanged sentence

We also pay an unused commitment fee on the average daily unused portion of the Facility at a rate of 0.25 % per year.

The average interest rate for the six month period ended June 30, 2025 was 6.2 %.

The average interest rate for the nine month period ended September 30, 2025 was 6.2 %.

Interest expense and unused commitment fees are recorded in other income (expense).

3 unchanged sentences

Effective March 31, 2025, we amended the Facility to exclude dividends from the interest coverage ratio financial covenant.

We were in compliance with all financial covenants under the Credit Agreement at June 30, 2025.

We were in compliance with all financial covenants under the Credit Agreement at September 30, 2025.

Stockholders' Equity

During the six months ended June 30, 2025, we repurchased or withheld an aggregate of 224,867 shares of our common stock, as described below.

During the nine months ended September 30, 2025, we repurchased or withheld an aggregate of 225,459 shares of our common stock, as described below.

Repurchase Program

1 unchanged sentence

The purchases may be made from time to time in the open market or directly from stockholders at prevailing market prices based on market conditions and other factors.

During the six months ended June 30, 2025, 45,000 shares were repurchased under the Repurchase Program.

As of June 30, 2025, we were authorized to repurchase an additional 1,407,764 shares under the Repurchase Program.

During the nine months ended September 30, 2025, 45,000 shares were repurchased under the Repurchase Program.

As of September 30, 2025, we were authorized to repurchase an additional 1,407,764 shares under the Repurchase Program.

Withheld Shares

During the six months ended June 30, 2025, we withheld 179,867 shares to satisfy tax withholding obligations for the vesting of long-term incentive and restricted stock unit awards.

Insperity | 2025 Second Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

During the nine months ended September 30, 2025, we withheld 180,459 shares to satisfy tax withholding obligations for the vesting of long-term incentive and restricted stock unit awards.

The Board declared and paid quarterly dividends as follows:

2 unchanged sentences

Second quarter 0.60 0.60

During the six months ended June 30, 2025 and 2024, we declared and paid dividends totaling $ 45 million and $ 44 million, respectively.

Third quarter 0.60 0.60

During the nine months ended September 30, 2025 and 2024, we declared and paid dividends totaling $ 68 million and $ 67 million, respectively.

Earnings Per Share

1 unchanged sentence

Diluted EPS is computed by dividing net income by the weighted average number of common shares outstanding during the period, plus the dilutive effect of time-based and performance-based restricted stock units (“RSUs”).

The following table summarizes the net income and the basic and diluted shares used in the earnings per share computations:

Insperity | 2025 Third Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes net income and basic and diluted shares used in the earnings per share computations:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2025 2024 2025 2024

Net income (loss) $ ( 20 ) $ 3 $ 26 $ 100

$ ( 5 ) $ 18 $ 46 $ 97

Weighted average common shares outstanding 38 38 38 38

5 unchanged sentences

While the results of litigation cannot be predicted with certainty, management believes the final outcome of such litigation will not have a material adverse effect on our financial position or results of operations.

Subsequent Events

On July 1, 2025, we granted at-risk performance-based stock units (“PSUs”) under the Insperity, Inc.

Incentive Plan to our Chairman of the Board and Chief Executive Officer and to our President and Chief Operating Officer.

These PSUs are market-based awards and vest at the end of a five-year period assuming continued employment and achievement of specified stock price targets for a sustained period.

The fair value of the PSUs was determined through the use of the Monte Carlo simulation method.

The compensation expense for the PSUs will be recognized on a straight-line basis over the vesting term beginning in the third quarter of 2025.

On July 4, 2025, H.R.1, which is known as the “One Big Beautiful Bill Act,” was signed into federal law.

This law includes significant changes to federal tax law and other regulatory provisions that may impact us.

ASC 740, “Income Taxes”, requires the effect of changes in tax rates and laws on deferred tax balances to be recognized in the period in which the

Insperity | 2025 Second Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

legislation is enacted.

We are currently evaluating the provisions of H.R.1 and the potential effects on our financial position, results of operations, and cash flows.

As of the date of these financial statements, we have not completed our assessment, and therefore no adjustments have been made.

Additional disclosures of any material impact will be provided in future periods as the effect of the legislation is determined .

Insperity | 2025 Second Quarter Form 10-Q

Insperity | 2025 Third Quarter Form 10-Q

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

1 unchanged sentence

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 1. Financial Statements