TrueBlue, Inc. 10-K

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and the Board of Directors of TrueBlue, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of TrueBlue, Inc. and subsidiaries (the “Company”) as of December 28, 2025 and December 29, 2024, the related consolidated statements of operations and comprehensive income (loss), shareholders’ equity, and cash flows, for each of the three years in the period ended December 28, 2025, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 28, 2025 and December 29, 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 28, 2025, in conformity with accounting principles generally accepted in the United States of America. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 28, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 18, 2026, expressed an unqualified opinion on the Company’s internal control over financial reporting. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Workers’ Compensation Claims Reserves - Refer to Notes 1 and 7 to the Financial Statements Critical Audit Matter Description The Company bears the financial responsibility for a significant portion of expected losses under its workers’ compensation program and records reserves for workers’ compensation claims based on estimates of the future cost of claims and related expenses, which are discounted to their estimated net present value. The determination of the workers’ compensation reserve requires significant estimates and assumptions related to the future cost of claims and related expenses for claims that have been reported but not settled, as well as those that have been incurred but not reported. Given the fact that changes in actuarial assumptions could have a significant impact on the reserve, auditing management judgments regarding the workers’ compensation reserve, including estimates of the future cost of claims and related expenses, involved a high degree of auditor judgment, including the need to involve our actuarial specialists. Page - 45 Table of Contents How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the workers’ compensation reserve included the following, among others: • We tested the effectiveness of controls over workers’ compensation, including those over payments and related expenses, claims data provided to the actuary, and review of actuarial results. • We evaluated the methods and assumptions used by management to estimate the workers’ compensation reserve by: ◦ Making selections of the underlying claims data that serves as the basis for the actuarial analysis, including claims payments and related expenses, to evaluate whether the inputs to the actuarial estimate were reasonable; ◦ Assessing whether changes in the business or environment, including regulatory or legislative developments, impacts of safety initiatives, type and location of work performed, and positive or adverse development of claims, were appropriately considered; and ◦ Comparing management’s prior-year assumptions of expected future cost of claims and related expenses to actuals incurred during the current year to identify potential bias in the determination of the workers’ compensation reserve. • With the assistance of our actuarial specialists, we developed independent estimates of the workers’ compensation reserve and compared our estimates to the Company’s recorded workers’ compensation reserve. /s/ Deloitte & Touche LLP Seattle, Washington February 18, 2026 We have served as the Company’s auditor since 2009. Page - 46 Table of Contents TRUEBLUE, INC. CONSOLIDATED BALANCE SHEETS (in thousands, except par value and share count data) December 28, 2025 December 29, 2024 ASSETS Current assets: Cash and cash equivalents $ 24,510 $ 22,536 Accounts receivable, net of allowance of $ 2,190 and $ 1,009 , respectively 241,233 214,704 Prepaid expenses and other current assets 30,987 31,786 Income tax receivable 879 8,067 Total current assets 297,609 277,093 Property and equipment, net 73,117 89,602 Restricted cash, cash equivalents and investments 136,588 179,916 Deferred income taxes, net 1,338 886 Goodwill 42,496 24,543 Intangible assets, net 18,095 5,863 Operating lease right-of-use assets, net 34,045 47,334 Workers’ compensation claims receivable, net 25,659 38,343 Other assets, net 9,720 11,796 Total assets $ 638,667 $ 675,376 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Accounts payable and other accrued expenses $ 36,111 $ 45,599 Accrued wages and benefits 61,736 61,380 Income tax payable 1,038 315 Current portion of workers’ compensation claims reserve 24,193 34,729 Current operating lease liabilities 11,206 11,127 Other current liabilities 4,249 6,975 Total current liabilities 138,533 160,125 Workers’ compensation claims reserve, less current portion 72,551 105,063 Long-term debt 65,800 7,600 Long-term deferred compensation liabilities 39,531 38,109 Long-term operating lease liabilities 46,796 47,805 Other long-term liabilities 899 1,315 Total liabilities 364,110 360,017 Commitments and contingencies (Note 9) Shareholders’ equity: Preferred stock, $ 0.131 par value, 20,000,000 shares authorized; No shares issued and outstanding — — Common stock, no par value, 100,000,000 shares authorized; 29,986,762 and 29,588,363 shares issued and outstanding 1 1 Accumulated other comprehensive loss ( 21,647 ) ( 22,193 ) Retained earnings 296,203 337,551 Total shareholders’ equity 274,557 315,359 Total liabilities and shareholders’ equity $ 638,667 $ 675,376 See accompanying notes to consolidated financial statements Page - 47 Table of Contents TRUEBLUE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (in thousands, except per share data) 2025 2024 2023 Revenue from services $ 1,615,997 $ 1,567,393 $ 1,906,243 Cost of services 1,248,155 1,161,000 1,400,184 Gross profit 367,842 406,393 506,059 Selling, general and administrative expense 371,087 410,870 494,603 Depreciation and amortization (exclusive of depreciation included in cost of services) 24,823 28,624 25,821 Goodwill and intangible asset impairment charge 200 59,674 9,485 Right-of-use and other long-lived asset impairment charge 18,366 — — Loss from operations ( 46,634 ) ( 92,775 ) ( 23,850 ) Interest and other income (expense), net 1,003 4,251 3,205 Loss before tax expense (benefit) ( 45,631 ) ( 88,524 ) ( 20,645 ) Income tax expense (benefit) 2,329 37,224 ( 6,472 ) Net loss $ ( 47,960 ) $ ( 125,748 ) $ ( 14,173 ) Net loss per common share: Basic $ ( 1.61 ) $ ( 4.17 ) $ ( 0.45 ) Diluted $ ( 1.61 ) $ ( 4.17 ) $ ( 0.45 ) Weighted average shares outstanding: Basic 29,849 30,177 31,317 Diluted 29,849 30,177 31,317 Other comprehensive income (loss): Foreign currency translation adjustment $ 546 $ ( 1,481 ) $ ( 694 ) Total other comprehensive income (loss), net of tax 546 ( 1,481 ) ( 694 ) Comprehensive loss $ ( 47,414 ) $ ( 127,229 ) $ ( 14,867 ) See accompanying notes to consolidated financial statements Page - 48 Table of Contents TRUEBLUE, INC. CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY Common stock Accumulated other comprehensive loss Total shareholders ’ equity (in thousands) Shares Amount Retained earnings Balances, December 25, 2022 32,730 $ 1 $ 516,332 $ ( 20,018 ) $ 496,315 Net loss — — ( 14,173 ) — ( 14,173 ) Foreign currency translation adjustment — — — ( 694 ) ( 694 ) Purchases and retirement of common stock ( 1,877 ) — ( 34,178 ) — ( 34,178 ) Issuances under equity plans, including tax benefits 393 — ( 3,304 ) — ( 3,304 ) Stock-based compensation — — 13,907 — 13,907 Balances, December 31, 2023 31,246 1 478,584 ( 20,712 ) 457,873 Net loss — — ( 125,748 ) — ( 125,748 ) Foreign currency translation adjustment — — — ( 1,481 ) ( 1,481 ) Purchases and retirement of common stock ( 1,967 ) — ( 21,293 ) — ( 21,293 ) Issuances under equity plans, including tax benefits 309 — ( 1,583 ) — ( 1,583 ) Stock-based compensation — — 7,591 — 7,591 Balances, December 29, 2024 29,588 1 337,551 ( 22,193 ) 315,359 Net loss — — ( 47,960 ) — ( 47,960 ) Foreign currency translation adjustment — — — 546 546 Issuances under equity plans, including tax benefits 399 — ( 644 ) — ( 644 ) Stock-based compensation — — 7,256 — 7,256 Balances, December 28, 2025 29,987 $ 1 $ 296,203 $ ( 21,647 ) $ 274,557 See accompanying notes to consolidated financial statements Page - 49 Table of Contents TRUEBLUE, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) 2025 2024 2023 Cash flows from operating activities: Net loss $ ( 47,960 ) $ ( 125,748 ) $ ( 14,173 ) Adjustments to reconcile net loss to net cash (used in) provided by operating activities: Depreciation and amortization (inclusive of depreciation included in cost of services) 28,852 29,561 25,821 Goodwill and intangible asset impairment charge 200 59,674 9,485 Right-of-use and other long-lived asset impairment charge 18,366 — — Provision for credit losses 2,811 2,321 4,972 Stock-based compensation 7,256 7,591 13,907 Deferred income taxes ( 552 ) 34,060 ( 9,902 ) Non-cash lease expense 11,013 12,402 12,591 Other operating activities ( 5,038 ) ( 5,137 ) ( 3,831 ) Changes in operating assets and liabilities Accounts receivable ( 15,463 ) 35,731 56,761 Income taxes receivable and payable 4,094 3,196 ( 1,317 ) Other assets 15,767 22,766 31,366 Accounts payable and other accrued expenses ( 11,102 ) ( 8,908 ) ( 19,210 ) Other accrued wages and benefits ( 10,014 ) ( 19,147 ) ( 12,113 ) Workers’ compensation claims reserve ( 43,049 ) ( 56,723 ) ( 54,495 ) Operating lease liabilities ( 11,651 ) ( 12,324 ) ( 12,796 ) Other liabilities ( 1,572 ) 3,627 7,688 Net cash (used in) provided by operating activities ( 58,042 ) ( 17,058 ) 34,754 Cash flows from investing activities: Capital expenditures ( 15,678 ) ( 24,151 ) ( 31,276 ) Acquisition of businesses, net of cash acquired ( 30,149 ) — — Divestiture of business 400 3,099 — Payments for company-owned life insurance ( 2 ) ( 4,000 ) ( 2,347 ) Proceeds from company-owned life insurance 300 — 1,662 Purchases of restricted held-to-maturity investments ( 10,877 ) ( 11,242 ) ( 34,110 ) Sales and maturities of restricted held-to-maturity investments 39,944 33,841 33,749 Net cash used in investing activities ( 16,062 ) ( 2,453 ) ( 32,322 ) Cash flows from financing activities: Purchases and retirement of common stock — ( 21,293 ) ( 34,178 ) Net proceeds from employee stock purchase plans 454 738 856 Common stock repurchases for taxes upon vesting of restricted stock ( 1,097 ) ( 2,325 ) ( 4,161 ) Net change in revolving credit facility 58,200 7,600 — Other ( 414 ) ( 1,807 ) ( 100 ) Net cash provided by (used in) financing activities 57,143 ( 17,087 ) ( 37,583 ) Change in cash, cash equivalents and restricted cash and cash equivalents reclassified to assets held-for-sale — — ( 300 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents ( 119 ) ( 1,608 ) ( 874 ) Net change in cash, cash equivalents and restricted cash and cash equivalents ( 17,080 ) ( 38,206 ) ( 36,325 ) Cash, cash equivalents and restricted cash and cash equivalents, beginning of period 61,100 99,306 135,631 Cash, cash equivalents and restricted cash and cash equivalents, end of period $ 44,020 $ 61,100 $ 99,306 Supplemental disclosure of cash flow information: Cash paid (received) during the period for: Interest $ 4,622 $ 1,044 $ 1,031 Income taxes, net of refunds $ ( 4,847 ) $ 211 $ 5,171 Operating lease liabilities $ 14,438 $ 15,268 $ 15,799 Non-cash transactions: Property and equipment purchased but not yet paid $ 808 $ 1,422 $ 3,404 Divestiture non-cash consideration $ — $ 400 $ — Right-of-use assets obtained in exchange for new operating lease liabilities $ 10,794 $ 9,977 $ 12,526 See accompanying notes to consolidated financial statements Page - 50 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of business TrueBlue, Inc. (the “company,” “TrueBlue,” “we,” “us” and “our”) is a leading provider of specialized workforce solutions that help clients achieve business growth and improve productivity. We serve clients in a wide variety of industries through our PeopleReady segment which offers general, industrial and skilled trade contingent staffing, our PeopleManagement segment which offers contingent, on-site industrial staffing and commercial driver services, and our PeopleSolutions segment which offers recruitment process outsourcing (“RPO”), managed service provider (“MSP”), talent advisory solutions and skilled healthcare staffing solutions. Basis of presentation The consolidated financial statements (“financial statements”) include the accounts of TrueBlue and all of its wholly-owned subsidiaries. Intercompany balances and transactions have been eliminated in consolidation. The financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Fiscal period end The financial statements are presented on a 52/53-week fiscal year-end basis, with the last day of the fiscal year ending on the Sunday closest to the last day of December. In fiscal years consisting of 53 weeks, the final quarter consists of 14 weeks, while in fiscal years consisting of 52 weeks, all quarters consist of 13 weeks. Our 2023 fiscal year contained 53 weeks, with the 53rd week falling in the fiscal fourth quarter, while our 2025 and 2024 fiscal years contained 52 weeks. Use of estimates Preparing financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Estimates in our financial statements include, but are not limited to, acquisition method of accounting, allowance for credit losses, estimates for asset and goodwill impairments, stock-based awards, assumptions underlying self-insurance reserves, contingent legal, regulatory and government incentive liabilities, and the potential outcome of future tax consequences of events that have been recognized in the financial statements. Actual results and outcomes may differ from these estimates and assumptions due to risks and uncertainties, including uncertainty in the current economic environment. Revenue recognition We account for a contract when both parties to the contract have approved the contract, the rights of the parties are identified, payment terms are identified, the contract has commercial substance, and collectability of consideration is probable. Consolidated revenues are presented net of intercompany eliminations. Additionally, consolidated revenues are recognized net of any discounts, allowances and sales incentives, including rebates. Revenues are recognized over time using an output measure, as the control of the promised services is transferred to the client, in an amount that reflects the consideration we expect to be entitled to in exchange for those services. The majority of our contracts are short-term in nature as they are filling the contingent staffing needs of our clients, or include termination clauses that allow either party to cancel within a short notice period, without cause. Revenue includes billable travel and other reimbursable costs and are reported net of sales, use or other transaction taxes collected from clients and remitted to taxing authorities. Payment terms vary by client and the services offered, however we do not extend payment terms beyond one year. Substantially all of our contracts include payment terms of 90 days or less. We primarily record revenue on a gross basis as a principal on the Consolidated Statements of Operations and Comprehensive Income (Loss) based upon the following key factors: • We maintain the direct contractual relationship with the client and are responsible for fulfilling the service promised to the client. • We demonstrate control over the services provided to our clients. • We establish our billing rates. Page - 51 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Contingent staffing We recognize revenue for our PeopleReady, PeopleManagement and Healthcare Staffing Professionals (“HSP”) contingent staffing services over time as services are performed in an amount that reflects the consideration we expect to be entitled to collect in exchange for our services, which is generally calculated as hours worked or number of units multiplied by the agreed-upon bill rate. The client simultaneously receives and consumes the benefits of the services as they are provided. We incur immaterial costs to obtain our contingent staffing contracts. We have concluded that the amortization period for these costs would be less than one year and have elected to use the practical expedient to expense these costs as incurred. Also, we incur immaterial costs to fulfill some contingent staffing contracts, which are expensed as incurred. Human resource outsourcing We primarily recognize revenue for our PeopleScout outsourced recruitment of permanent employees over time in an amount that reflects the consideration we expect to be entitled to in exchange for our services. The client simultaneously receives and consumes the benefits of the services as they are provided. We recognize revenue using an output method, generally based on the number of hires made during each month multiplied by the agreed-upon rate per hire. We incur immaterial costs to obtain our outsourced recruitment of permanent employee contracts. We have concluded that the amortization period for these costs would be less than one year and have elected to use the practical expedient to expense these costs as incurred. Also, we incur immaterial costs to fulfill these contracts, which are expensed as incurred. Unsatisfied performance obligations As a practical expedient, we do not disclose the value of unsatisfied performance obligations for (i) contracts with an expected original duration of one year or less and (ii) contracts for which we recognize revenue at an amount for which we have the right to invoice for services performed. Cost of services Cost of services refers to costs directly associated with the earning of revenue and primarily includes wages, payroll taxes, benefits, and workers’ compensation expenses for our associates and employees involved with the delivery of our services. Cost of services also includes depreciation related to certain assets directly associated with earning revenue. These costs differ fundamentally from selling, general and administrative ("SG&A") expenses in that they arise specifically from the action of providing services to clients, whereas SG&A costs are incurred regardless of whether or not we provide service to our clients. Advertising costs Advertising costs consist primarily of print, digital and other promotional activities. We expense advertisements as of the first date the advertisements take place. Advertising expenses included in SG&A expense on our Consolidated Statements of Operations and Comprehensive Income (Loss) were $ 4.9 million, $ 6.1 million and $ 9.2 million in fiscal 2025, 2024 and 2023, respectively. Cash, cash equivalents and marketable securities We consider all highly liquid instruments purchased with an original maturity of three months or less at date of purchase to be cash equivalents. Investments with original maturities greater than three months are classified as marketable securities. We do not buy and hold securities principally for the purpose of selling them in the near future. Our investment policy is focused on the preservation of capital, liquidity and return. From time to time, we may sell certain securities but the objective is not to generate profits on short-term differences in price. We manage our cash equivalents and marketable securities as a single portfolio of highly liquid securities. We have not experienced any losses related to these balances, and we believe credit risk to be minimal. Page - 52 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Accounts receivable and allowance for credit losses Accounts receivable are recorded at the invoiced amount. We establish an estimate for the allowance for credit losses resulting from the failure of our clients to make required payments by applying an aging schedule to pools of assets with similar risk characteristics. Based on an analysis of the risk characteristics of our clients and associated receivables, we have concluded our pools are as follows: • PeopleReady (excluding RenewableWorks) has a large, diverse set of clients, generally with frequent, low dollar invoices due to the daily nature of the work we perform. This results in high turnover in accounts receivable. • Centerline Drivers (“Centerline”) has a mix of client sizes, many with low dollar weekly invoices, but other clients that are invoiced on a consolidated basis, resulting in a high concentration of revenue related to its top 10 clients. Payment terms are slightly longer than PeopleReady. • Our PeopleScout and HSP brands have a smaller number of clients in a variety of industries and are generally invoiced monthly on a consolidated basis. Invoice amounts are generally higher for these brands than our other businesses, with longer payment terms than PeopleReady and Centerline. These businesses also have significant balances due from governmental entities. • Our Staff Management | SMX and SIMOS Insourcing Solutions brands have a smaller number of clients and follow a contractual billing schedule. These clients generally operate in the manufacturing, warehousing and distribution industries and have longer payment terms than our other businesses. • Our RenewableWorks brand has a small number of large clients that operate in the energy industry, generally with high dollar invoices, and follows a contractual billing schedule. Payment terms are slightly longer than most of our other businesses. When specific clients are identified as no longer sharing the same risk profile as their current pool, they are removed from the pool and evaluated separately. The credit loss rates applied to each aging category by pool are based on current collection efforts, historical collection trends, write-off experience, client credit risk and current economic data. Management has elected the practical expedient to assume that current conditions as of the balance sheet date do not change for the remaining life of the assets. The allowance for credit loss is reviewed and represents our best estimate of the amount of expected credit losses. Past due or delinquent balances are identified based upon a review of aged receivables performed by collections and operations. Past due balances are written off when it is probable the receivable will not be collected. Changes in the allowance for credit losses are recorded in SG&A expense on the Consolidated Statements of Operations and Comprehensive Income (Loss). Restricted cash, cash equivalents and investments Cash and investments pledged as collateral and restricted for use in workers’ compensation insurance programs are included as restricted cash, cash equivalents and investments on our Consolidated Balance Sheets. Our investments consist of highly rated investment grade debt securities, which at the time of purchase, were rated A1/P1 or higher for short-term securities and A or higher for long-term securities, by nationally recognized rating organizations. We have the positive intent and ability to hold our restricted investments until maturity in accordance with our investment policy and, accordingly, all of our restricted investments are classified as held-to-maturity. In the event that an investment is downgraded below our investment policy criteria, it may be replaced with a new security. We establish an allowance for credit loss for our held-to-maturity debt securities using a discounted cash flow method including a probability of default rate based on the issuer’s credit rating. We have an agreement with American International Group, Inc. and the Bank of New York Mellon Corporation creating a trust (“Trust”), which holds the majority of our collateral obligations under existing workers’ compensation insurance policies. Placing the collateral in the Trust allows us to manage the investment of the assets and provides greater protection of those assets. Fair value of financial instruments and investments Fair value is the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. For assets and liabilities recorded or disclosed at fair value on a recurring basis, we determine fair value based on the following: • Level 1: Inputs are valued using quoted market prices in active markets for identical assets or liabilities. Page - 53 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS • Level 2: Inputs other than quoted prices in active markets for identical assets and liabilities are used. • Level 3: Assets and liabilities with unobservable inputs. The carrying value of our cash and cash equivalents and restricted cash and cash equivalents approximates fair value because of the short-term maturity of those instruments. We hold money market funds to support our workers’ compensation program, which are carried at fair value based on quoted market prices in active markets for identical assets. There are inherent limitations when estimating the fair value of financial instruments, and the fair values reported are not necessarily indicative of the amounts that would be realized in current market transactions. The carrying value of our accounts receivable, accounts payable and other accrued expenses, and accrued wages and benefits approximates fair value due to their short-term nature. We hold company-owned life insurance policies that fund our deferred compensation liability. Company-owned life insurance policies are carried at cash surrender value, which approximates fair value. We hold certain restricted investments to collateralize our workers’ compensation programs, which are classified as held-to-maturity and carried at amortized cost on our Consolidated Balance Sheets. We determine the fair value of these restricted investments based on comparisons to similar financial instruments or financial models based on observable inputs to arrive at consensus pricing. Annual and interim impairment tests may subject our reporting units with goodwill and other intangible assets to nonrecurring fair value measurement. We typically determine the fair value of these items using internal estimates and assumptions that market participants would use in pricing the asset. Property and equipment Property and equipment are recorded at cost. We compute depreciation using the straight-line method over the estimated useful lives of the assets as follows: Years Buildings 40 Software 4 - 8 Computers, furniture and equipment 3 - 10 Leasehold improvements are depreciated over the shorter of the related non-cancelable lease term or their estimated useful lives. Non-capital expenditures associated with opening new locations are expensed as incurred. When property is retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss, net of proceeds, is reflected on the Consolidated Statements of Operations and Comprehensive Income (Loss). Repairs and maintenance costs are charged directly to expense as incurred. Major renewals or replacements that substantially extend the useful life of an asset are capitalized and depreciated. Costs associated with the acquisition or development of software for internal use, including internal and external labor costs, are capitalized and depreciated over the expected useful life of the software, from four to eight years . Capitalization of costs begins when the preliminary project stage is complete, when management authorizes and commits to funding the project, and it is probable the project will be completed for the intended use. Capitalization of costs ends when the project is substantially complete and ready for its intended use. A subsequent addition, modification or upgrade to internal-use software is capitalized to the extent that it enhances the software’s functionality or extends its useful life. Software maintenance and training costs are expensed in the period incurred. Leases We conduct our PeopleReady branch operations primarily from leased locations. We also lease office spaces for our other operations, centralized support functions, office equipment, and machinery for use at client sites. Many leases require variable payments for common area maintenance, sales tax, repairs and maintenance, and insurance coverage, in addition to base rent. The variable portion of these lease payments is not included in our right-of-use assets or lease liabilities. Rather, variable payments, other than those dependent upon an index or rate, along with any non-lease components of a contract, are expensed when the obligation for those payments is incurred and are included in SG&A expense on our Consolidated Statements of Operations and Comprehensive Income (Loss). We determine if an arrangement meets the definition of a lease at inception, at which time we also perform an analysis to determine whether the lease qualifies as operating or financing. The terms of our lease agreements generally range from three to five years , with some as high as 15 years and many containing options to renew. Under the majority of our leases, we have the right to terminate the lease with 90 days’ notice. Page - 54 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Operating leases are included in operating lease right-of-use assets, net and current and long-term operating lease liabilities on our Consolidated Balance Sheets. Lease expense for operating leases is recognized on a straight-line basis over the lease term and is included in SG&A expense on our Consolidated Statements of Operations and Comprehensive Income (Loss). Lease right-of-use assets and lease liabilities are measured using the present value of future minimum lease payments over the lease term at commencement date. The right-of-use asset also includes any lease payments made on or before the commencement date of the lease, less any lease incentives received. As the rate implicit in the lease is not readily determinable in our leases, we use our incremental borrowing rates based on the information available at the lease commencement date in determining the present value of lease payments. The incremental borrowing rates used are estimated based on what we would be required to pay for a collateralized loan over a similar term. We have lease agreements with lease and non-lease components, which are accounted for as a single lease component. For leases with an initial non-cancelable lease term of less than one year and no option to purchase, we have elected not to recognize the lease on our Consolidated Balance Sheets and instead recognize rent payments on a straight-line basis over the lease term within SG&A expense on our Consolidated Statements of Operations and Comprehensive Income (Loss). In addition, for those leases where the right to cancel the lease is available to both TrueBlue (as the lessee) and the lessor, the lease term is the initial non-cancelable period plus the notice period, which is typically 90 days, and not greater than one year. Goodwill and indefinite-lived intangible assets We evaluate goodwill and indefinite-lived intangible assets for impairment on an annual basis as of the first day of our fiscal second quarter, or whenever events or circumstances make it more likely than not that an impairment may have occurred. These events or circumstances could include a significant change in general economic conditions, deterioration in industry environment, changes in cost factors, declining operating performance indicators, legal factors, competition, client engagement, changes in the carrying amount of net assets, sale or disposition of a significant portion of a reporting unit, or a sustained decrease in stock price. We monitor the existence of potential impairment indicators throughout the fiscal year. Goodwill We test for goodwill impairment at the reporting unit level. We consider our reporting units to be our operating segments or one level below that (the component level) based on our organizational structure. Our reporting units with remaining goodwill as of the first day of our fiscal second quarter of 2025 were Centerline, PeopleScout and HSP. When evaluating goodwill for impairment, we may first assess qualitative factors to determine whether it is more likely than not the fair value of a reporting unit is less than its carrying amount. Qualitative factors include macroeconomic conditions, industry and market conditions and overall company financial performance. If, after assessing the totality of events and circumstances, we determine that it is more likely than not the fair value of the reporting unit is greater than its carrying amount, the quantitative impairment test is unnecessary. The quantitative impairment test, if necessary, involves comparing the fair value of each reporting unit to its carrying value, including goodwill. Fair value reflects the price a market participant would be willing to pay in a potential sale of the reporting unit. If the fair value exceeds the carrying value, we conclude that no goodwill impairment has occurred. If the carrying value exceeds the fair value, we recognize an impairment charge in an amount equal to the excess, not to exceed the carrying value of the goodwill. We consider a reporting unit’s fair value to be substantially in excess of its carrying value at a 20 % premium or greater. We performed our annual impairment test for goodwill as of the first day of the fiscal second quarter of 2025, which did not result in impairment of goodwill for any reporting unit. Refer to Note 6: Goodwill and Intangible Assets for additional details on the impairment test, valuation methodologies and inputs used in the fair value measurements. Indefinite-lived intangible assets We have indefinite-lived intangible assets for trademarks related to businesses within our PeopleSolutions and PeopleManagement segments. We evaluate our indefinite-lived intangible assets for impairment on an annual basis as of the first day of our fiscal second quarter, or whenever events or circumstances make it more likely than not that an impairment may have occurred. These events or circumstances could include significant change in general economic conditions, deterioration in industry environment, changes in cost factors, declining operating performance indicators, legal factors, competition, client engagement, or sale or disposition of a significant portion of the business. We monitor the existence of potential impairment indicators throughout the fiscal year. Page - 55 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS When evaluating indefinite-lived intangible assets for impairment, we may first assess qualitative factors to determine whether it is more likely than not the fair value of the indefinite-lived intangible asset is less than its carrying amount. Qualitative factors include macroeconomic conditions, industry and market conditions and overall company financial performance. If, after assessing the totality of events and circumstances, we determine that it is more likely than not the fair value of the indefinite-lived intangible asset is greater than its carrying amount, the quantitative impairment test is unnecessary. The quantitative impairment test, if necessary, utilizes the relief from royalty method to determine the fair value of each of our trademarks. If the carrying value exceeds the fair value, we recognize an impairment charge in an amount equal to the excess, not to exceed the carrying value. We performed our annual impairment test for indefinite-lived intangible assets as of the first day of the fiscal second quarter of 2025, which resulted in an impairment of $ 0.2 million to a trademark related to our PeopleManagement segment. Refer to Note 6: Goodwill and Intangible Assets for additional details on the impairment test, valuation methodologies and inputs used in the fair value measurements. Other long-lived assets We have finite-lived intangible assets related to acquired company customers, trade names/trademarks, and technology, as well as purchased trade names/trademarks. We capitalize implementation costs incurred in a cloud computing arrangement that is a service contract. Capitalized implementation costs are recorded in both prepaid expenses and other current assets, and in other assets, net on our Consolidated Balance Sheets, depending on the timing of future amortization. The related amortization expense is recorded in SG&A expense on our Consolidated Statements of Operations and Comprehensive Income (Loss) on a straight-line basis over the fixed, non-cancelable term of the associated arrangement plus any reasonably certain renewal periods. License fees incurred during the development period are expensed as incurred. Other long-lived assets are tested for impairment whenever events or changes in circumstances indicate that the carrying value of an asset group may not be recoverable. Other long-lived assets include property and equipment, lease right-of-use assets, finite-lived intangible assets and capitalized implementation costs for cloud computing arrangements that are service contracts. During the fiscal year ended December 28, 2025, we recorded an operating lease right-of-use and other long-lived asset impairment charge of $ 18.4 million as a result of executing a sublease for our Chicago support center. Refer to Note 9: Commitments and Contingencies for additional details on the impairment test, valuation methodologies and inputs used in the fair value measurements. There were no other material long-lived asset impairment charges recorded during the fiscal year ended December 28, 2025. Workers’ compensation claims reserves We maintain reserves for workers’ compensation claims using actuarial estimates of the future cost of claims and related expenses. These estimates include claims that have been reported but not settled and claims that have been incurred but not reported. These reserves, which reflect potential liabilities to be paid in future periods based on estimated payment patterns, are discounted to estimated net present value using discount rates based on average returns of “risk-free” U.S. Treasury instruments available during the year in which the liability was incurred, which are evaluated on a quarterly basis. We evaluate the reserves regularly throughout the year and make adjustments accordingly. If the actual cost of such claims and related expenses exceeds the amounts estimated, additional reserves may be required. Changes in reserve estimates are reflected in cost of services on the Consolidated Statements of Operations and Comprehensive Income (Loss) in the period when the changes are made. Our workers’ compensation reserves include estimated expenses related to claims above our self-insured limits (“excess claims”) and a corresponding receivable for the insurance coverage on excess claims based on the contractual policy agreements we have with insurance companies. We discount this reserve and corresponding receivable to its estimated net present value using the discount rates based on average returns of “risk-free” U.S. Treasury instruments available during the year in which the liability was incurred. We also establish an allowance for credit loss for our insurance receivables using a probability of default and losses expected upon default method, with the probability of default rate based on the third-party insurance carrier’s credit rating. Changes in the allowance for credit losses are recorded in cost of services on the Consolidated Statements of Operations and Comprehensive Income (Loss). Management evaluates the adequacy of the workers’ compensation reserves in conjunction with an independent quarterly actuarial assessment. Factors considered by management, along with our third-party actuary and third-party administrator, in establishing and adjusting these reserves include, among other things: • changes in medical and time loss (“indemnity”) costs; • changes in mix between medical only and indemnity claims; Page - 56 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS • regulatory and legislative developments impacting benefits and settlement requirements; • type and location of work performed; • impact of safety initiatives; and • positive or adverse development of claims. Legal contingency reserves and regulatory liabilities We are subject to compliance audits by federal, state, local and international authorities relating to a variety of regulations including wage and hour laws, taxes, workers’ compensation, immigration and safety. In addition, we are subject to legal proceedings in the ordinary course of our operations. We establish accruals for contingent legal and regulatory liabilities when management determines that it is probable that a legal claim will result in an adverse outcome and the amount of liability can be reasonably estimated. We evaluate our reserve regularly throughout the year and make adjustments as needed. If the actual outcome of these matters is different than expected, an adjustment is charged or credited to expense in the period the outcome occurs or the estimate changes. Income taxes and related valuation allowance We account for income taxes by recording taxes payable or receivable for the current year and deferred tax assets and liabilities for the future tax consequences of events that have been recognized in our financial statements or tax returns. These expected future tax consequences are measured based on provisions of tax law as currently enacted; the effects of future changes in tax laws are not anticipated. We recognize deferred tax assets to the extent we believe it is more likely than not the asset will be realized. We consider available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit the use of existing deferred tax assets when making such determination, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, carryback potential if permitted and results of recent operations. A significant piece of objective negative evidence is the existence of a three-year cumulative loss. Such objective negative evidence limits the ability of management to consider other subjective evidence, such as projected taxable income. When appropriate, we record a valuation allowance against deferred tax assets to reduce deferred tax assets to the amount that is more likely than not to be realized. Our liability for unrecognized tax benefits is recorded in other long-term liabilities on our Consolidated Balance Sheets. We recognize interest and penalties related to unrecognized tax benefits within income tax expense (benefit) on the accompanying Consolidated Statements of Operations and Comprehensive Income (Loss). Accrued interest and penalties are included within other long-term liabilities on the Consolidated Balance Sheets. Deferred compensation plan We offer a non-qualified defined contribution plan (the “Plan”) to eligible employees. Participating employees may elect to defer and contribute a portion of their eligible compensation. The Plan allows participants to direct their account based on the investment options determined by TrueBlue and offers discretionary matching contributions. The current portion of the deferred compensation liability is included in accrued wages and benefits on our Consolidated Balance Sheets. The total deferred compensation liability is funded through company-owned life insurance policies recorded in restricted cash, cash equivalents and investments on our Consolidated Balance Sheets. The carrying value of company-owned life insurance policies is based on the cash surrender value of the policies, which approximates fair value. Changes in the cash surrender value, premiums incurred, and proceeds received relating to the company-owned life insurance policies are recorded in SG&A expense on our Consolidated Statements of Operations and Comprehensive Income (Loss). Stock-based compensation Compensation expense for restricted stock awards and restricted stock units is based on the grant-date fair value of our stock and is generally recognized on a straight-line basis over the vesting period. Compensation expense for performance share units which are contingent upon achievement of a non-market-based performance condition is based on the grant-date fair value of our stock, and expense is recognized on a straight-line basis over the performance period adjusted for the ultimate number of shares expected to be issued as of the end of each reporting period. Compensation expense for performance share units which are contingent upon achievement of a market-based performance condition is based on the grant-date fair value utilizing a Monte Carlo simulation, and is generally recognized on a straight-line basis over the performance period. Page - 57 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Compensation expense for all stock-based awards is adjusted for forfeitures as they occur. Compensation expense for our employee stock purchase plan (“ESPP”) is based on the estimated fair value on the date of grant, using the Black-Scholes valuation model, and is recognized on a straight-line basis over the offering period, which is over a calendar month. In the event that there are changes to an employee’s requisite service period based on terms existing in the original award agreement, any unrecognized compensation expense is recognized prospectively over the updated remaining requisite service period. In the case that terms of an existing stock award agreement are modified, the sum of any unrecognized compensation expense as of the modification date and the modification charge will be expensed on a straight-line basis over the new requisite service period. The modification charge is the incremental amount of the fair value of the award before the modification and the fair value after the modification. Foreign currency Our financial statements are reported in U.S. dollars. Assets and liabilities of foreign subsidiaries with non-U.S. dollar functional currencies are translated to U.S. dollars at the exchange rates in effect on the balance sheet date. Revenues and expenses for each subsidiary are translated to U.S. dollars using a weighted average rate for the relevant reporting period. Translation adjustments resulting from this process are included, net of tax, in accumulated other comprehensive loss on our Consolidated Statements of Operations and Comprehensive Income (Loss), when applicable. Revenue and expense transactions denominated in a currency other than our functional currency are converted to our functional currency using the exchange rate on the transaction date. Gains or losses resulting from these transactions are included in interest and other income (expense), net on our Consolidated Statements of Operations and Comprehensive Income (Loss). Purchases and retirement of our common stock We purchase our common stock under a program authorized by our Board of Directors (“Board”). Under applicable Washington State law, shares purchased are not displayed separately as treasury stock on the Consolidated Balance Sheets and are treated as authorized but unissued shares. It is our accounting policy to first record these purchases and the related excise tax as a reduction to our common stock account. Once the common stock account has been reduced to a nominal balance, remaining purchases are recorded as a reduction to our retained earnings. Furthermore, activity in our common stock account related to stock-based compensation is also recorded to retained earnings until such time as the reduction to retained earnings due to stock repurchases has been recovered. Net income (loss) per share Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares and potential common shares outstanding during the period. Potential common shares include the dilutive effects of vested and non-vested restricted stock, performance share units, and shares issued under the ESPP, except where their inclusion would be anti-dilutive. Anti-dilutive shares primarily include non-vested restricted stock and performance share units for which the sum of the assumed proceeds, including unrecognized compensation expense, exceeds the average stock price during the periods presented. Segments Our operating segments are based on the organizational structure for which financial results are regularly reviewed by our chief operating decision-maker (“CODM”), our Chief Executive Officer, to determine resource allocation and assess performance. We evaluate performance based on segment revenue and segment profit. Segment revenue is net of intercompany eliminations. Segment profit includes revenue, related cost of services, and ongoing operating expenses directly attributable to the reportable segment. Segment profit excludes goodwill and intangible asset impairment charges, depreciation and amortization expense, unallocated corporate general and administrative expense, interest and other income (expense), income taxes, and other costs and benefits not considered to be ongoing. Our CODM uses both segment revenue and segment profit during the annual budget and quarterly forecasting processes. On a monthly basis, our CODM reviews segment revenue and segment profit results compared to the prior forecast in order to make decisions about allocation of operating capital resources to each segment. Segment profit is also used to determine the compensation of certain employees. Page - 58 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Government assistance There is limited U.S. GAAP accounting guidance for for-profit business entities that receive government assistance, so we have elected to analogize to International Financial Reporting Standards (“IFRS”), specifically International Accounting Standards (“IAS”) 20, Accounting for Government Grants and Disclosures of Government Assistance. Following IAS 20, we recognize government assistance on a systematic basis over the periods in which we recognize the related costs for which the grant is intended to compensate, but only when there is reasonable assurance we will comply with all conditions attached to the grant and there is reasonable assurance the assistance will be received. We have interpreted “reasonable assurance” to mean “probable,” as defined in loss contingencies guidance in U.S. GAAP. During fiscal 2025, management determined the reasonable assurance criteria was met for certain payroll tax credits for which recognition was previously deferred. As a result, $ 3.2 million and $ 6.0 million was recognized within cost of services and SG&A expense, respectively, on the Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal year ended December 28, 2025. This also resulted in the reversal of previously accrued interest expense related to these benefits of $ 2.1 million, which was recorded within interest and other income (expense), net on the Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal year ended December 28, 2025. The benefits were partially offset by recognition of related professional fee expenses of $ 0.6 million, which were recorded within SG&A expense on the Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal year ended December 28, 2025. Based on the reasonable assurance criteria, we continue to defer recognition of certain benefits of $ 5.1 million as of December 28, 2025 until recognition becomes probable, which is included in accrued wages and benefits on our Consolidated Balance Sheets. Business combinations We account for our business acquisitions using the acquisition method of accounting. The fair value of the net assets acquired and the results of the acquired business are included in the financial statements from the acquisition date forward. We are required to make estimates and assumptions that affect the reported amounts of assets and liabilities and results of operations during the reporting period. Estimates are used in accounting for, among other things, the fair value of acquired net operating assets, property and equipment, intangible assets, useful lives of property and equipment, and amortizable lives for acquired intangible assets. Any excess of the purchase consideration over the identified fair value of the assets and liabilities acquired is recognized as goodwill. Goodwill acquired in business combinations is assigned to the reporting unit(s) expected to benefit from the combination as of the acquisition date. We estimate the fair value of acquired assets and liabilities as of the date of the acquisition based on information available at that time. The initial valuation of these tangible and identifiable intangible assets and liabilities is subject to further management review and may change between the preliminary allocation and the final allocation. Our acquisitions may include contingent consideration, which require us to recognize the fair value of the estimated liability at the time of the acquisition. Subsequent changes in the estimate of the amount to be paid under the contingent consideration arrangement are recognized on the Consolidated Statements of Operations and Comprehensive Income (Loss). Cash payments to settle the contingent consideration liability within a relatively short period of time after the acquisition is completed are classified as investing activities in the Consolidated Statements of Cash Flows. Cash payments to settle the contingent consideration liability up to the acquisition date fair value (including measurement period adjustments) that are not within a relatively short period of time are recorded as financing activities in the Consolidated Statements of Cash Flows. Cash payments to settle contingent consideration liability in excess of the acquisition date fair value (including measurement period adjustments) are recorded as operating activities in the Consolidated Statements of Cash Flows. Alternatively, our acquisitions may include contingent payments to employees that are selling shareholders, which would be considered a transaction separate from the business combination, and therefore are accounted for as compensation expense. All acquisition-related costs are expensed as incurred and recorded in SG&A expense on the Consolidated Statements of Operations and Comprehensive Income (Loss). Additionally, we recognize liabilities for restructuring costs that will be necessary due to the elimination of excess capacity, redundant assets or unnecessary functions, and record them as SG&A expense on the Consolidated Statements of Operations and Comprehensive Income (Loss). Page - 59 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Recently adopted accounting pronouncements Income taxes In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-09, “Income Taxes (Topic 740) - Improvements to Income Tax Disclosures,” which requires enhancements and further transparency to certain income tax disclosures, primarily to the tax rate reconciliation and income taxes paid. This ASU is effective for fiscal years beginning after December 15, 2024 (2025 for TrueBlue), on a prospective basis with retrospective application permitted. We have adopted the disclosure requirements of this ASU retrospectively, which are reflected in our expanded disclosures within Note 13: Income Taxes. Credit losses In July 2025, the FASB issued ASU 2025-05, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets.” ASU 2025-05 provides a practical expedient for entities to assume the current conditions as of the balance sheet date do not change for the remaining life of the asset when assessing expected credit losses on current accounts receivable and contract assets arising from transactions accounted for under Topic 606. This ASU is effective for fiscal years beginning after December 15, 2025 (fiscal 2026 for TrueBlue) and interim reporting periods within those annual reporting periods. If the practical expedient is elected, it will apply prospectively. We elected to early adopt the use of the practical expedient as of December 28, 2025. Use of the practical expedient did not have a material impact on our consolidated financial statements. Recently issued accounting pronouncements not yet adopted Disaggregation of income statement expenses In November 2024, the FASB issued ASU 2024-03, “Income Statement (Subtopic 220-40): Disaggregation of Income Statement Expenses,” and in January 2025, the FASB issued ASU 2025-01, “Income Statement (Subtopic 220-40): Clarifying the Effective Date.” ASU 2024-03 requires disclosures about specific types of expenses included in the expense captions presented in the income statement as well as disclosure about selling expenses. ASU 2024-03, as clarified by ASU 2025-01, is effective for fiscal years beginning after December 15, 2026 (fiscal 2027 for TrueBlue) and interim periods beginning after December 15, 2027 (fiscal Q1 2028 for TrueBlue) on a prospective or retrospective basis. We are currently evaluating the impact of this ASU on our required disclosures. Internal-use software In September 2025, the FASB issued ASU 2025-06, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) - Targeted Improvements to the Accounting for Internal-Use Software.” This ASU eliminates references to project stages and instead requires an entity to start capitalizing software costs once both of the following criteria have been met: (1) management has authorized and committed to funding the software project, and (2) it is probable that the project will be completed and the software will be used for its intended function. This ASU is effective for fiscal years beginning after December 15, 2027 (fiscal 2028 for TrueBlue) and interim reporting periods within those annual reporting periods (fiscal Q1 2028 for TrueBlue). The guidance can be applied on a prospective basis, a modified basis for in-process projects or a retrospective basis, and early adoption is permitted. We are currently evaluating the impact of this ASU. Interim reporting In December 2025, the FASB issued ASU 2025-11, “Interim Reporting (Topic 270) - Narrow-Scope Improvements.” This ASU clarifies interim disclosure requirements; it does not attempt to expand or reduce disclosures. ASU 2025-11 also includes a disclosure principle to help entities determine which events since the end of the last annual reporting period are material for disclosure. This ASU is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027 (fiscal Q1 2028 for TrueBlue). The guidance can be applied on a prospective basis, or a retrospective basis for all or any prior periods, and early adoption is permitted. We are currently evaluating the impact of this ASU; however, it is not anticipated to have a material impact on our consolidated financial statements. Page - 60 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Government assistance In December 2025, the FASB issued ASU 2025-10, “Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities. This ASU provides authoritative guidance for the recognition, measurement and presentation of government grants received by a business entity. This ASU is effective for annual reporting periods beginning after December 15, 2028 (fiscal 2029 for TrueBlue) and interim periods within those annual periods (fiscal Q1 2029 for TrueBlue). The guidance can be applied on a modified prospective, modified retrospective, or retrospective approach; early adoption is permitted. We are currently evaluating the impact of this ASU on our consolidated financial statements and related disclosures. NOTE 2: ACQUISITION Effective January 31, 2025, we acquired all of the outstanding equity interests of Healthcare Staffing Professionals, Inc., a long-term staffing and permanent hiring solutions provider, primarily focused on healthcare positions in the U.S. This acquisition allows us to expand revenue in the healthcare end-market while also diversifying our business. Under the terms of the share purchase agreement, the base purchase price of $ 42.0 million was adjusted for estimated unpaid pre-close liabilities of the selling shareholders, cash acquired and estimated excess working capital. The purchase price allocated to acquired assets and liabilities was cash consideration of $ 35.2 million. As part of the share purchase agreement, certain Healthcare Staffing Professionals, Inc. employees can earn up to an additional $ 14.0 million based on the financial performance of the business over the next two years, which we have concluded should be treated as compensation expense. Any amounts probable of being paid out under the agreement are expensed over the required service period. We incurred acquisition-related costs of $ 0.8 million for the fiscal year ended December 28, 2025, which are included in SG&A expense on the Consolidated Statements of Operations and Comprehensive Income (Loss). The following table reflects our final allocation of the purchase price to the fair value of assets acquired and liabilities assumed: (in thousands) Purchase price allocation Purchase price allocated as follows: Cash and cash equivalents $ 5,042 Accounts receivable 13,877 Prepaid expenses, deposits and other current assets 216 Operating lease right-of-use assets 97 Intangible assets 14,950 Total assets acquired 34,182 Accounts payable and other accrued expenses 2,228 Accrued wages and benefits 10,369 Income tax payable 3,635 Operating lease liabilities 97 Total liabilities assumed 16,329 Net identifiable assets acquired 17,853 Goodwill (1) 17,338 Total cash consideration transferred $ 35,191 (1) Goodwill represents the expected synergies with our existing businesses, the acquired assembled workforce, potential new clients and future cash flows after the acquisition of Healthcare Staffing Professionals, Inc., and is deductible for income tax purposes. Intangible assets include identifiable intangible assets for customer relationships and trade names/trademarks. We estimated the fair value of the acquired identifiable intangible assets, which are subject to straight line amortization, using an income approach. These fair value measurements were based on Level 3 inputs under the fair value hierarchy. Page - 61 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The following table sets forth the components of identifiable intangible assets acquired, including immaterial measurement period adjustments, as of January 31, 2025: (in thousands, except percentages and estimated useful lives, in years) Estimated fair value Estimated useful life in years Valuation method Discount rate Customer relationships $ 14,300 6 Multi-period excess earnings 17.0 % Trade names/trademarks 650 7 Relief from royalty 17.0 % Total acquired identifiable intangible assets $ 14,950 The acquired assets and assumed liabilities of Healthcare Staffing Professionals, Inc. are included on our Consolidated Balance Sheets as of December 28, 2025, and the results of its operations are reported on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the period from February 1, 2025 to December 28, 2025. The amount of revenue and income from operations for Healthcare Staffing Professionals, Inc. included on our Consolidated Statements of Operations and Comprehensive Income (Loss) was $ 55.5 million and $ 1.2 million for the fiscal year ended December 28, 2025, respectively. Income from operations includes $ 2.3 million of amortization expense related to acquired intangible assets. Healthcare Staffing Professionals, Inc. results have been combined with our historical PeopleScout segment, which was renamed PeopleSolutions in fiscal 2025. We concluded the acquisition of Healthcare Staffing Professionals, Inc. was not material to our consolidated results of operations and, as such, pro forma financial information was not required. NOTE 3: FAIR VALUE MEASUREMENT Accounts receivable, accounts payable and other accrued expenses, accrued wages and benefits and related taxes approximate their fair values due to the short-term maturities of these assets and liabilities. Our long-term debt is related to a revolving credit agreement and its carrying value approximates fair value as the interest rates are variable and reflect current market rates. Assets measured at fair value on a recurring basis Our assets measured at fair value on a recurring basis consisted of the following: December 28, 2025 (in thousands) Total fair value Quoted prices in active markets for identical assets (level 1) Significant other observable inputs (level 2) Significant unobservable inputs (level 3) Cash and cash equivalents $ 24,510 $ 24,510 $ — $ — Restricted cash and cash equivalents 19,510 19,510 — — Cash, cash equivalents and restricted cash and cash equivalents (1) $ 44,020 $ 44,020 $ — $ — Municipal debt securities $ 7,836 $ — $ 7,836 $ — Corporate debt securities 50,334 — 50,334 — Agency mortgage-backed securities 4,873 — 4,873 — U.S. government and agency securities 7,973 — 7,973 — Restricted investments classified as held-to-maturity (2) $ 71,016 $ — $ 71,016 $ — Page - 62 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 29, 2024 (in thousands) Total fair value Quoted prices in active markets for identical assets (level 1) Significant other observable inputs (level 2) Significant unobservable inputs (level 3) Cash and cash equivalents $ 22,536 $ 22,536 $ — $ — Restricted cash and cash equivalents 38,564 38,564 — — Cash, cash equivalents and restricted cash and cash equivalents (1) $ 61,100 $ 61,100 $ — $ — Municipal debt securities $ 22,355 $ — $ 22,355 $ — Corporate debt securities 63,512 — 63,512 — Agency mortgage-backed securities 11,754 — 11,754 — U.S. government and agency securities 971 — 971 — Restricted investments classified as held-to-maturity (2) $ 98,592 $ — $ 98,592 $ — (1) Cash, cash equivalents and restricted cash and cash equivalents include money market funds, deposits and investments with original maturities of three months or less. (2) Refer to Note 4: Restricted Cash, Cash Equivalents and Investments for additional details on our held-to-maturity debt securities. Assets measured at fair value on a nonrecurring basis Goodwill and intangible assets In addition to assets that are recorded at fair value on a recurring basis, impairment tests may subject our reporting units with goodwill and other intangible assets to nonrecurring fair value measurement. We performed our annual impairment test for goodwill and indefinite-lived intangible assets as of the first day of fiscal second quarter of 2025. Refer to Note 6: Goodwill and Intangible Assets for additional details on the impairment charges, valuation methodologies and inputs used in the fair value measurements. For our annual goodwill impairment test as of the first day of fiscal second quarter of 2025, the fair value of each reporting unit was estimated using an equal weighting of the income and market approaches. The various inputs to these fair value models are considered Level 3. As a result of the test, all of our reporting units with remaining goodwill had a fair value in excess of their respective carrying value. For our annual indefinite-lived intangible asset impairment test as of the first day of fiscal second quarter of 2025, the fair value of our trademarks were estimated using the relief from royalty method. The various inputs to this fair value model are considered Level 3. As a result of the test, a trademark related to our PeopleManagement segment with a carrying value of $ 2.7 million was written down to its fair value, and an impairment charge of $ 0.2 million was recognized on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal year ended December 28, 2025. Right-of-use and long-lived assets The execution of a sublease related to our Chicago support center in the fiscal fourth quarter of 2025 required us to reevaluate the related long-lived asset group and test the new asset group for recoverability and impairment. The Chicago support center asset group consists of the operating lease right-of-use asset, and related leasehold improvements and furniture. We estimated the fair value of the asset group using the income approach, specifically a discounted cash flow valuation technique. The various inputs to this fair value model are considered Level 3. As a result of the test, we recognized an impairment charge of $ 18.4 million on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal year ended December 28, 2025. The impairment was allocated to the assets within the asset group using a pro-rata method based on relative carrying values, resulting in an operating lease right-of-use asset impairment of $ 13.0 million, a leasehold improvement impairment of $ 5.2 million, and a furniture impairment of $ 0.2 million. Refer to Note 9: Commitments and Contingencies for additional details on the impairment charge, valuation methodology and inputs used in the fair value measurement. Page - 63 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 4: RESTRICTED CASH, CASH EQUIVALENTS AND INVESTMENTS The following is a summary of the carrying value of our restricted cash, cash equivalents and investments: (in thousands) December 28, 2025 December 29, 2024 Cash collateral held by insurance carriers $ 7,681 $ 22,387 Cash and cash equivalents held in Trust 11,424 15,406 Investments held in Trust 70,601 99,506 Company-owned life insurance policies 46,477 41,846 Other restricted cash and cash equivalents 405 771 Total restricted cash, cash equivalents and investments $ 136,588 $ 179,916 Held-to-maturity Restricted cash, cash equivalents and investments include collateral that has been provided or pledged to insurance carriers for workers’ compensation and state workers’ compensation programs. Our insurance carriers and certain state workers’ compensation programs require us to collateralize a portion of our workers’ compensation obligation. The collateral typically takes the form of cash and cash equivalents and highly rated investment grade securities, primarily in debt and asset-backed securities. The majority of our collateral obligations are held in a Trust. The amortized cost and estimated fair value of our held-to-maturity investments held in Trust, aggregated by investment category as of December 28, 2025 and December 29, 2024, were as follows: December 28, 2025 (in thousands) Amortized cost Gross unrealized gains Gross unrealized losses Fair value Municipal debt securities $ 7,840 $ 1 $ ( 5 ) $ 7,836 Corporate debt securities 49,967 519 ( 152 ) 50,334 Agency mortgage-backed securities 4,815 58 — 4,873 U.S. government and agency securities 7,979 1 ( 7 ) 7,973 Total held-to-maturity investments $ 70,601 $ 579 $ ( 164 ) $ 71,016 December 29, 2024 (in thousands) Amortized cost Gross unrealized gains Gross unrealized losses Fair value Municipal debt securities $ 22,490 $ — $ ( 135 ) $ 22,355 Corporate debt securities 64,313 144 ( 945 ) 63,512 Agency mortgage-backed securities 11,703 68 ( 17 ) 11,754 U.S. government and agency securities 1,000 — ( 29 ) 971 Total held-to-maturity investments $ 99,506 $ 212 $ ( 1,126 ) $ 98,592 The amortized cost and fair value by contractual maturity of our held-to-maturity investments are as follows: December 28, 2025 (in thousands) Amortized cost Fair value Due in one year or less $ 42,323 $ 42,250 Due after one year through five years 28,278 28,766 Total held-to-maturity investments $ 70,601 $ 71,016 Actual maturities may differ from contractual maturities because the issuers of certain debt securities have the right to call or prepay their obligations without penalty. We have no significant concentrations of counterparties in our held-to-maturity investment portfolio. Page - 64 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Deferred compensation investments and company-owned life insurance policies We hold company-owned life insurance policies to support our deferred compensation liability. The unrealized gains and losses related to investments still held at December 28, 2025, December 29, 2024 and December 31, 2023, included in SG&A expense on our Consolidated Statements of Operations and Comprehensive Income (Loss), were as follows: (in thousands) 2025 2024 2023 Unrealized gains, net $ 4,931 $ 4,940 $ 4,383 NOTE 5: SUPPLEMENTAL BALANCE SHEET INFORMATION Accounts receivable allowance for credit losses (in thousands) 2025 2024 2023 Beginning balance $ 1,009 $ 2,005 $ 3,212 Current period provision 2,811 2,321 4,972 Write-offs ( 1,630 ) ( 3,314 ) ( 6,184 ) Foreign currency translation — ( 3 ) 5 Ending balance $ 2,190 $ 1,009 $ 2,005 Prepaid expenses and other current assets (in thousands) December 28, 2025 December 29, 2024 Prepaid software agreements $ 6,997 $ 8,501 Other prepaid expenses 7,484 6,329 Assets held-for-sale 11,759 11,759 Other current assets 4,747 5,197 Prepaid expenses and other current assets $ 30,987 $ 31,786 Assets held-for-sale As of December 28, 2025 and December 29, 2024, all criteria for classifying our Tacoma headquarters office building as held-for-sale were met. Completion of the sale of the building is expected within a year from December 28, 2025. The estimated fair value of the disposal group, less costs to sell, continues to exceed its carrying value of $ 11.8 million, and therefore no impairment charge was recorded during the fiscal year ended December 28, 2025. Property and equipment (in thousands) December 28, 2025 December 29, 2024 Buildings and land $ 23,550 $ 23,537 Software 226,573 220,095 Computers, furniture and equipment 33,745 37,885 Construction in progress 1,014 838 Gross property and equipment 284,882 282,355 Less accumulated depreciation ( 206,401 ) ( 192,753 ) Less impairment charge (1) ( 5,364 ) — Property and equipment, net $ 73,117 $ 89,602 (1) Refer to Note 9: Commitments and Contingencies for further information on this impairment charge consisting of leasehold improvement impairment of $ 5.2 million and furniture impairment of $ 0.2 million related to the sublease of our Chicago support center. Capitalized software costs, net of accumulated depreciation, were $ 67.2 million and $ 76.3 million as of December 28, 2025 and December 29, 2024, respectively, excluding amounts in construction in progress. Construction in progress consists primarily of purchased and internally-developed software. Page - 65 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Depreciation expense for property and equipment, inclusive of depreciation included in cost of services, totaled $ 26.3 million, $ 25.5 million and $ 20.6 million for the fiscal years ended December 28, 2025, December 29, 2024 and December 31, 2023, respectively. For the fiscal years ended December 28, 2025 and December 29, 2024, depreciation expense of $ 4.0 million and $ 0.9 million was included in cost of services, respectively. NOTE 6: GOODWILL AND INTANGIBLE ASSETS Goodwill The following table reflects changes in the carrying amount of goodwill during the period by reportable segments: (in thousands) PeopleReady PeopleManagement PeopleSolutions Total company Balance at December 31, 2023 Goodwill before impairment $ 105,284 $ 81,092 $ 142,191 $ 328,567 Accumulated impairment charge ( 46,210 ) ( 79,601 ) ( 118,642 ) ( 244,453 ) Goodwill 59,074 1,491 23,549 84,114 Impairment charge ( 59,074 ) — — ( 59,074 ) Foreign currency translation — — ( 497 ) ( 497 ) Balance at December 29, 2024 Goodwill before impairment 105,284 81,092 141,694 328,070 Accumulated impairment charge ( 105,284 ) ( 79,601 ) ( 118,642 ) ( 303,527 ) Goodwill — 1,491 23,052 24,543 Acquired goodwill (1) — — 17,338 17,338 Foreign currency translation — — 615 615 Balance at December 28, 2025 Goodwill before impairment 105,284 81,092 159,647 346,023 Accumulated impairment charge ( 105,284 ) ( 79,601 ) ( 118,642 ) ( 303,527 ) Goodwill $ — $ 1,491 $ 41,005 $ 42,496 (1) Effective January 31, 2025, we acquired Healthcare Staffing Professionals, Inc. The goodwill associated with the acquisition has been assigned to the HSP reporting unit, and included within the PeopleSolutions reportable segment (previously known as PeopleScout) based on our purchase price allocation. Refer to Note 2: Acquisition for additional details. Page - 66 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 2025 impairments Effective March 31, 2025 (the first day of our fiscal second quarter of 2025), we combined our PeopleScout RPO and PeopleScout MSP reporting units into one reporting unit, PeopleScout. This change coincided with the elimination of PeopleScout MSP as an operating segment within the PeopleSolutions reportable segment (refer to Note 15: Segment Information for additional details). Immediately before the combination, we tested the PeopleScout RPO reporting unit, with a remaining goodwill balance of $ 22.4 million, and the PeopleScout MSP reporting unit, with a remaining goodwill balance of $ 0.8 million, for impairment. The PeopleScout RPO reporting unit’s fair value was substantially in excess of its carrying value, and the PeopleScout MSP reporting unit’s fair value approximated its carrying value. After combining the reporting units, the fair value of the PeopleScout reporting unit was substantially in excess of its carrying value. As a result, no impairment charge was recognized. We performed our annual impairment test as of the first day of our fiscal second quarter of 2025 for our reporting units with remaining goodwill: Centerline, PeopleScout and HSP. The fair value of each reporting unit was estimated using a weighting of the income and market valuation approaches. The income approach applied a fair value methodology to each reporting unit based on discounted cash flows. This analysis requires significant judgments, including estimation of future cash flows, which is dependent on internally-developed forecasts of revenue and profitability, estimation of the long-term rate of growth for our business, estimation of the useful life over which cash flows will occur, and determination of our weighted average cost of capital, which is risk-adjusted to reflect the specific risk profile of the reporting unit being tested. The weighted average cost of capital used in our most recent impairment test ranged from 14.5 % to 16.5 %. We also applied a market approach, which develops a value correlation based on the market capitalization of similar publicly traded companies, referred to as a multiple, to apply to the forecasted future operating results of the reporting units. The primary market multiples considered for the market approach are revenue and earnings before interest, taxes, depreciation and amortization. The income and market approaches for each reporting unit were equally weighted in our most recent annual impairment test. The combined fair values for all reporting units were then reconciled to our aggregate market value of our shares of common stock on the date of valuation, while considering a reasonable control premium. We consider a reporting unit’s fair value to be substantially in excess of its carrying value at a 20 % premium or greater. Based on our annual impairment test, all of our reporting units’ fair values were substantially in excess of their respective carrying values, except for HSP, for which the estimated fair value was in excess of its carrying value by approximately 5 %. This level of headroom is expected, due to the short amount of time that has passed between the acquisition date, when the carrying value of the reporting unit approximated its fair value, and our annual impairment test as of the first day of our fiscal second quarter of 2025. The goodwill balance for HSP as of December 28, 2025 was $ 17.3 million. Any significant adverse change in our near- or long-term projections or macroeconomic conditions could result in future impairment charges. We will continue to closely monitor the operational performance of this reporting unit. Additionally, following performance of the annual impairment test we did not identify any events or conditions that make it more likely than not that an impairment may have occurred. Accordingly, no impairment charge was recognized during the fiscal year ended December 28, 2025. 2024 impairments Annual impairment test We performed an interim impairment test as of the last day of the fiscal first quarter of 2024, as management determined that a triggering event had occurred as a result of continued decline for our services, overall economic uncertainty, and a sustained decrease in our stock price, which did not result in impairment of goodwill for any reporting unit. Given the proximity of our first quarter interim impairment measurement date to our annual goodwill impairment measurement date (first day of the fiscal second quarter), we performed a qualitative assessment to determine whether it was more likely than not that the fair value of any of our reporting units was less than the carrying value. We considered the current and expected future economic and market conditions and concluded it was unlikely the goodwill associated with our reporting units was impaired as of the first day of our fiscal second quarter. Interim impairment test During the fiscal second quarter of 2024, subsequent to our annual test as of the first day of our fiscal second quarter, management determined that a triggering event had occurred as a result of additional decline in demand for our services, prolonged economic uncertainty and a further decrease in our stock price. Therefore, we performed an interim impairment test as of the last day of fiscal May 2024 for our reporting units with remaining goodwill. Page - 67 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS As a result of our May 2024 interim impairment test, we concluded that the carrying amount of the PeopleReady reporting unit exceeded its fair value. Thus, we recorded a non-cash goodwill impairment charge of $ 59.1 million, representing the remaining goodwill balance for PeopleReady, which was included in goodwill and intangible asset impairment charge on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal year ended December 29, 2024. The goodwill impairment was primarily driven by the performance of the PeopleReady reporting unit and the temporary industrial staffing industry since our annual impairment testing date, as well as a delay in the projected timing of recovery. The weighted average cost of capital used in the 2024 interim impairment test ranged from 13.5 % to 14.5 %. 2023 impairments Annual impairment test As a result of our 2023 annual impairment test, we concluded that the carrying amount of the former PeopleScout MSP reporting unit exceeded its fair value and we recorded a non-cash goodwill impairment charge of $ 8.9 million, which was included in goodwill and intangible asset impairment charge on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal year ended December 31, 2023. The former PeopleScout MSP goodwill impairment was related to our revised internal revenue projections, which anticipated the 2023 declining trends would continue into future periods. These projections were updated based on our then-current outlook and recent industry analysis, which indicated that our business would underperform due to a strategic lack of investment in technology within an increasingly competitive market. The weighted average cost of capital used in the 2023 annual impairment test ranged from 13.0 % to 13.5 %. The remaining goodwill balance for our former PeopleScout MSP reporting unit was $ 0.8 million as of December 31, 2023. Indefinite-lived intangible assets We held indefinite-lived trade names/trademarks of $ 4.6 million and $ 4.8 million as of December 28, 2025 and December 29, 2024, respectively, related to businesses within our PeopleManagement and PeopleSolutions segments. 2025 impairments As a result of our annual impairment test as of the first day of our fiscal second quarter of 2025, we concluded that the carrying amount of a trademark related to the PeopleManagement segment exceeded its estimated fair value and we recorded a non-cash impairment charge of $ 0.2 million, which was included in goodwill and intangible asset impairment charge on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal year ended December 28, 2025. The charge was primarily driven by an increase in the discount rate of 1.0% since our last impairment test. The remaining balance for this trademark was $ 2.5 million as of December 28, 2025. As of our annual impairment test, the fair value of the trademark related to the PeopleSolutions segment was in excess of its carrying amount of $ 2.1 million, and therefore did not result in an impairment. Additionally, following performance of the annual impairment test, we did not identify any additional events or conditions that make it more likely than not an additional impairment may have occurred. Accordingly, no further impairment charge was recognized during the fiscal year ended December 28, 2025. 2024 impairments During the fiscal second quarter of 2024, we concluded that the carrying amount of a trademark related to the PeopleManagement segment exceeded its estimated fair value and recorded a non-cash impairment charge of $ 0.6 million, which was included in goodwill and intangible asset impairment charge on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal year ended December 29, 2024. The charge was primarily driven by revenue performance of the related business given a decline in demand and overall economic uncertainty. The remaining balance for this trademark was $ 2.7 million as of December 29, 2024. As of our fiscal second quarter impairment test, the fair value of the trademark related to our former PeopleScout segment was substantially in excess of its carrying amount of $ 2.1 million, and therefore did not result in an impairment. Page - 68 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 2023 impairments As a result of our 2023 annual impairment test, we concluded that the carrying amount of a trademark related to the PeopleManagement segment exceeded its estimated fair value and recorded a non-cash impairment charge of $ 0.6 million, which was included in goodwill and intangible asset impairment charge on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal year ended December 31, 2023. The charge was primarily the result of an increase in the discount rate, as well as lower projected revenues given our then-current outlook. The remaining balance for this trademark was $ 3.3 million as of December 31, 2023. As of our 2023 annual impairment test, the fair value of the trademark related to our former PeopleScout segment was substantially in excess of its carrying amount of $ 2.1 million, and therefore did not result in an impairment. Finite-lived intangible assets The following table presents our purchased finite-lived intangible assets: December 28, 2025 December 29, 2024 (in thousands) Gross carrying amount Accumulated amortization Net carrying amount Gross carrying amount Accumulated amortization Net carrying amount Finite-lived intangible assets (1): Customer relationships $ 14,300 $ ( 2,185 ) $ 12,115 $ 2,637 $ ( 2,448 ) $ 189 Trade names/trademarks 2,405 ( 1,025 ) 1,380 1,632 ( 758 ) 874 Total finite-lived intangible assets $ 16,705 $ ( 3,210 ) $ 13,495 $ 4,269 $ ( 3,206 ) $ 1,063 (1) Excludes assets that are fully amortized. The gross carrying amounts as of December 28, 2025 include customer relationships and trade names/trademarks of $ 14.3 million and $ 0.7 million, respectively, related to the acquisition of Healthcare Staffing Professionals, Inc. Refer to Note 2: Acquisition for additional details. Amortization expense of our finite-lived intangible assets was $ 2.6 million, $ 4.1 million and $ 5.2 million for the fiscal years ended December 28, 2025, December 29, 2024 and December 31, 2023, respectively. The following table provides the estimated future amortization of finite-lived intangible assets as of December 28, 2025: (in thousands) 2026 $ 2,602 2027 2,602 2028 2,602 2029 2,602 2030 2,602 Thereafter 485 Total future amortization $ 13,495 We did not identify any events or conditions that make it more likely than not that an impairment of our finite-lived intangible assets may have occurred for the fiscal year ended December 28, 2025. There were no finite-lived intangible asset impairment charges recorded during fiscal 2024 or 2023. NOTE 7: WORKERS' COMPENSATION INSURANCE AND RESERVES We provide workers’ compensation insurance for our associates and permanent employees. The majority of our current workers’ compensation insurance policies cover claims for a particular event above our $ 5.0 million deductible limit, on a “per occurrence” basis. This results in our being substantially self-insured. Our workers’ compensation reserve for claims below the deductible limit is discounted to its estimated net present value. The discount rates used to estimate net present value are based on average returns of “risk-free” U.S. Treasury instruments available during the year in which the liability was incurred and the weighted average duration of the payments against the self-insured claims. Payments made against self-insured claims are made over a weighted average period of approximately 3 years as of Page - 69 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 28, 2025. The weighted average discount rate was 3.1 % and 2.7 % at December 28, 2025 and December 29, 2024, respectively. The following table presents a reconciliation of the undiscounted workers’ compensation reserve to the discounted workers’ compensation reserve for the periods presented: (in thousands) December 28, 2025 December 29, 2024 Undiscounted workers’ compensation reserve (1) $ 107,480 $ 152,803 Less discount on workers’ compensation reserve 10,736 13,011 Workers’ compensation reserve, net of discount 96,744 139,792 Less current portion 24,193 34,729 Long-term portion $ 72,551 $ 105,063 (1) Amounts shown are net of discount related to claims above our self-insured limits (“excess claims”). Payments made against self-insured claims were $ 45.3 million, $ 42.1 million and $ 45.0 million for the fiscal years ended December 28, 2025, December 29, 2024 and December 31, 2023, respectively. Our workers’ compensation reserve includes estimated expenses related to claims above our self-insured limits (“excess claims”), and we record a corresponding receivable for the insurance coverage on excess claims based on the contractual policy agreements we have with insurance carriers. We discount this reserve and corresponding receivable to its estimated net present value using the discount rates based on average returns of “risk-free” U.S. Treasury instruments available during the year in which the liability was incurred and the weighted average duration of the payments against the excess claims. The rates used to discount excess claims incurred during the fiscal years ended December 28, 2025 and December 29, 2024 were 3.9 % and 4.4 %, respectively. The discounted workers’ compensation reserve for excess claims were $ 25.7 million and $ 38.6 million, as of December 28, 2025 and December 29, 2024, respectively. The discounted receivables from insurance companies, net of allowance for credit loss, were $ 25.7 million and $ 38.3 million as of December 28, 2025 and December 29, 2024, respectively. The table below presents the estimated future payout of our discounted workers’ compensation claims reserve for the next five years and thereafter as of December 28, 2025: (in thousands) 2026 $ 24,193 2027 13,059 2028 7,237 2029 4,563 2030 3,199 Thereafter 18,793 Sub-total 71,044 Excess claims (1) 25,700 Total $ 96,744 (1) Estimated expenses related to claims above our self-insured limits for which we have a corresponding receivable for the insurance coverage based on contractual policy agreements. Workers’ compensation cost consists primarily of changes in self-insurance reserves net of changes in discount, monopolistic jurisdictions’ premiums, insurance premiums and other miscellaneous expenses. Workers’ compensation cost of $ 21.6 million, $ 7.4 million and $ 20.1 million was recorded in cost of services on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal years ended December 28, 2025, December 29, 2024 and December 31, 2023, respectively. Page - 70 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 8: LONG-TERM DEBT We have a revolving credit agreement with Bank of America, N.A., PNC Bank, N.A., HSBC Bank USA, N.A., Wells Fargo Bank, N.A., and Key Bank, N.A. dated as of February 9, 2024 (the “Revolving Credit Facility”). The Revolving Credit Facility provides for a revolving line of credit of up to $ 255.0 million, and matures on February 9, 2029. We have an option to increase the amount to $ 405.0 million, subject to lender approval. Included in the Revolving Credit Facility is a $ 25.0 million sub-limit for “Swingline” loans and a $ 25.0 million sub-limit for letters of credit. On June 27, 2025, we entered into the first amendment to our credit agreement, which modified the definition of “Consolidated EBITDA” in our financial covenants to exclude certain workforce reduction and lease exit costs for a limited period, as well as certain other provisions of the Revolving Credit Facility. As of December 28, 2025, $ 65.8 million was drawn on the Revolving Credit Facility, which included $ 40.0 million of one-month Term Secured Overnight Financing Rate (“SOFR”) Loans, a $ 5.0 million Base Rate Loan, and $ 20.8 million of Swingline loans. An additional $ 11.4 million was utilized by outstanding standby letters of credit, leaving $ 177.8 million unused under the Revolving Credit Facility. We are constrained by our most restrictive covenant, making $ 67.6 million available for additional borrowing. As of December 29, 2024, $ 7.6 million was drawn on the Revolving Credit Facility as a Swingline loan and $ 2.7 million was utilized by outstanding standby letters of credit. Under the terms of the Revolving Credit Facility, we have the option to borrow funds under the revolving line of credit as a Term SOFR Loan, for a one-, three- or six-month term, or as a Base Rate Loan, as defined in the Revolving Credit Facility. Under a Term SOFR Loan, we are required to pay a variable rate of interest on funds borrowed based on the Term SOFR Screen Rate two days prior for the equivalent term, plus an adjustment of 0.10 %, plus an applicable spread between 1.75 % and 3.50 %. Under a Base Rate Loan we are required to pay a variable rate of interest on funds borrowed based on a base rate plus an applicable spread between 0.75 % and 2.50 %. The base rate is the greater of the one-month Term SOFR Screen Rate two days prior plus 1.0 %, the prime rate (as announced by Bank of America), or the federal funds rate plus 0.50 %. The applicable spread is determined by the consolidated leverage ratio, as defined in the Revolving Credit Facility. As of December 28, 2025, the outstanding balance under Term SOFR loans carried an applicable spread on the base rate of 3.50 % and a weighted average base rate of 3.89 %, resulting in a weighted average interest rate of 7.39 %. As of December 28, 2025, the outstanding balance under the Base Rate Loan carried an applicable spread of 2.50 % and the base rate was 6.75 %, resulting in an interest rate of 9.25 %. Draws on our Revolving Credit Facility were primarily used to fund the acquisition of Healthcare Staffing Professionals, Inc. and to support working capital requirements as revenue grew. Under a Swingline loan, we are required to pay a variable rate of interest on funds borrowed based on the base rate plus applicable spread between 0.75 % and 2.50 %, as described above. As of December 28, 2025, the applicable spread on the base rate was 2.50 % and the base rate was 6.75 %, resulting in an interest rate of 9.25 %. A commitment fee between 0.35 % and 0.50 % is applied against the Revolving Credit Facility’s unused borrowing capacity, with the specific rate determined by the consolidated leverage ratio, as defined in the Revolving Credit Facility. Letters of credit are priced at a margin between 1.50 % and 3.25 %, with the specific rate determined by the consolidated leverage ratio, plus a fronting fee of 0.25 %. Obligations under the Revolving Credit Facility are guaranteed by TrueBlue and material U.S. domestic subsidiaries, and are secured by substantially all of the assets of TrueBlue and material U.S. domestic subsidiaries. The Revolving Credit Facility contains customary representations and warranties, events of default, and affirmative and negative covenants, including, among others, financial covenants. The following financial covenants, as defined in the Revolving Credit Facility, were in effect as of December 28, 2025: • Consolidated fixed charge coverage ratio greater than 1.25 , defined as the trailing twelve months bank-adjusted cash flow divided by cash interest expense. As of December 28, 2025, our consolidated fixed charge coverage ratio was 2.97 . • Asset coverage ratio greater than 1.00 , defined as the ratio of (a) 60 % of accounts receivable to (b) total debt outstanding less unrestricted cash in excess of $ 50.0 million, subject to certain minimums. Under this covenant we are limited to $ 25.0 million in aggregate share repurchases in any twelve-month period. As of December 28, 2025, our asset coverage ratio was 1.88 . Page - 71 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The following financial covenant, as defined in the Revolving Credit Facility, will replace the asset coverage ratio beginning the fiscal first quarter of 2026, or earlier at our discretion, subject to the terms of the agreement: • Consolidated leverage ratio less than 3.00 , defined as our funded indebtedness divided by trailing twelve months consolidated EBITDA, as defined in the Revolving Credit Facility. As of December 28, 2025, we were in compliance with all effective covenants related to the Revolving Credit Facility. Subsequent event On January 30, 2026, we entered into a second amendment to our credit agreement (“Second Amendment”). The Second Amendment reduces our line of credit from $ 255.0 million to $ 175.0 million, while retaining our option to increase the amount by $ 150.0 million, subject to lender approval, with no changes in Swingline sub-limits, letters of credit sub-limits, interest rate pricing or maturity date. The Second Amendment converts the Revolving Credit Facility from a cash-flow based revolving credit facility to an asset-based lending facility by replacing the existing structure of a revolving commitment with availability subject to satisfaction of certain financial maintenance covenants to a revolving commitment with availability subject to a borrowing base and a minimum excess availability covenant. The borrowing base is calculated as the sum of: (i) 90 % of the value of Investment Grade Eligible Accounts (as defined in the Second Amendment), plus (ii) 85 % of the value of Non-Investment Grade Eligible Accounts (as defined in the Second Amendment), plus (iii) 80 % of the value of Eligible Unbilled Accounts (as defined in the Second Amendment), less specific availability reserves. The minimum excess availability covenant may subsequently be replaced with a springing fixed charge coverage ratio covenant upon the satisfaction of meeting a minimum fixed charge coverage ratio test for two consecutive quarters occurring on or after September 27, 2026. The fixed charge coverage ratio covenant will thereafter apply when Excess Availability (as defined in the Second Amendment) is below certain thresholds. NOTE 9: COMMITMENTS AND CONTINGENCIES Workers’ compensation commitments We have provided our insurance carriers and certain states with commitments in the form and amounts listed below: (in thousands) December 28, 2025 December 29, 2024 Cash collateral held by workers’ compensation insurance carriers $ 3,376 $ 18,082 Cash and cash equivalents held in Trust 11,424 15,406 Investments held in Trust 70,601 99,506 Letters of credit (1) 3,385 2,605 Surety bonds (2) 21,116 19,831 Total collateral commitments $ 109,902 $ 155,430 (1) We have agreements with certain financial institutions to issue letters of credit as collateral. (2) Our surety bonds are issued by independent insurance companies on our behalf and bear annual fees based on a percentage of the bond, which are determined by each independent surety carrier. These fees do not exceed 2.0 % of the bond amount, subject to a minimum charge. The terms of these bonds are subject to review and renewal every one to four years and most bonds can be canceled by the sureties with as little as 60 days’ notice. Page - 72 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Operating leases We have contractual commitments in the form of operating leases related to office space, vehicles and equipment. Our leases have remaining terms of up to 11 years. Most leases include one or more options to renew, which can extend the lease term up to 10 years. The exercise of lease renewal options is at our sole discretion. Typically, at the commencement of a lease, we are not reasonably certain we will exercise renewal options, and accordingly they are not considered in determining the initial lease term. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. We rent or sublease real estate to third parties in limited circumstances. Operating lease costs were comprised of the following: (in thousands) 2025 2024 Operating lease costs $ 13,144 $ 14,447 Short-term lease costs (1) 6,445 7,508 Other lease costs, net (2) 3,288 2,841 Total lease costs $ 22,877 $ 24,796 (1) Excludes expenses related to leases with a lease term of less than one month. (2) Other lease costs include variable lease costs, net of rental and sublease income. Other information related to our operating leases was as follows: December 28, 2025 December 29, 2024 Weighted average remaining lease term in years 6.8 7.2 Weighted average discount rate 5.1 % 5.1 % Future non-cancelable minimum lease payments under our operating lease commitments as of December 28, 2025, are as follows for each of the next five years and thereafter: (in thousands) 2026 $ 13,880 2027 12,245 2028 10,311 2029 7,838 2030 4,853 Thereafter 20,256 Total undiscounted future non-cancelable minimum lease payments (1) 69,383 Less: Imputed interest (2) 11,381 Present value of lease liabilities $ 58,002 (1) Operating lease payments exclude $ 0.1 million of legally binding minimum lease payments for leases signed but not yet commenced. (2) Amount necessary to reduce net minimum lease payments to present value calculated using our incremental borrowing rates, which are consistent with the lease terms at adoption date (for those leases in existence as of the adoption date of the new lease standard) or lease inception (for those leases entered into after the adoption date). Page - 73 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 2025 impairment Following the coronavirus pandemic, the company shifted to a remote or hybrid work model for our headquarters and U.S.-based support teams, reducing the need for corporate office space. As a result, on October 6, 2025, we executed a sublease for our Chicago support center, which was approved by the landlord on October 28, 2025. The sublessee is expected to take possession of the space on April 1, 2026, and the sublease will remain in effect for the duration of the original lease term, concluding on June 29, 2036. Execution of the sublease required us to reevaluate the long-lived asset group for the Chicago support center and test the new asset group for recoverability and impairment during the fiscal fourth quarter of 2025. The Chicago support center asset group consists of the operating lease right-of-use asset, and related property and equipment, including leasehold improvements and furniture. We determined that the carrying value of the asset group, which was $ 23.5 million as of the measurement date, was not recoverable based on the undiscounted cash flows expected to result from the use and eventual disposition of the asset group. Therefore, we performed an impairment analysis. To perform this analysis, we estimated the fair value of the asset group using the income approach, specifically a discounted cash flow valuation technique. The valuation incorporated the terms of our executed sublease, which were determined to reflect market-based terms, and a discount rate of 9.0 %. As of the measurement date, we concluded that the carrying value of the asset group exceeded its estimated fair value and we recorded a non-cash impairment charge of $ 18.4 million, which was included in right-of-use and other long-lived asset impairment charge on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the fiscal year ended December 28, 2025. The impairment was allocated to the assets within the asset group using a pro-rata method based on relative carrying values, with $ 13.0 million allocated to operating lease right-of-use assets, net, and the remaining $ 5.4 million allocated to property and equipment, net, on our Consolidated Balance Sheets, which included leasehold improvement impairment of $ 5.2 million and furniture impairment of $ 0.2 million. Sublease income will be recognized as a reduction to lease expense on a straight-line basis over the remaining lease term, as net presentation better reflects our true cost of leasing the underlying asset. Initial direct costs, which consist of broker fees and tenant improvement allowances to be paid to the subtenant, will be recognized ratably as an offset to sublease income over the remaining term of the lease. Cash payments for rent expense under the head lease, as well as cash received from sublease income, are classified as cash flows from operating activities on the Consolidated Statements of Cash Flows. Purchase obligations Purchase obligations include agreements to purchase goods and services in the ordinary course of business that are enforceable, legally binding and specify all significant terms. Purchase obligations do not include agreements that are cancellable without significant penalty, or have a remaining term of less than one year as of December 28, 2025. We had $ 19.4 million of purchase obligations as of December 28, 2025, of which $ 11.6 million are expected to be paid in 2026, $ 4.3 million in 2027, $ 2.4 million in 2028, $ 1.0 million in 2029, and the remaining $ 0.1 million in 2030. Legal contingencies and developments We are involved in various proceedings arising in the normal course of conducting business. We believe the liabilities included in our financial statements reflect the probable loss that can be reasonably estimated and are immaterial. We also believe that the aggregate range of reasonably possible losses for the company's exposure in excess of the amount accrued is expected to be immaterial to the company. It remains possible that despite our current belief, material differences in actual outcomes or changes in management's evaluation or predictions could arise that could have a material effect on the company's financial condition, results of operations or cash flows. Page - 74 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 10: SHAREHOLDERS' EQUITY Common stock Shares of common stock outstanding include shares of unvested restricted stock. Unvested restricted stock included in reportable shares outstanding was 12.8 thousand and 8.2 thousand shares as of December 28, 2025 and December 29, 2024, respectively. On January 31, 2022, our Board authorized a $ 100.0 million addition to our share repurchase program for our outstanding common stock (“2022 authorization”). The share repurchase program does not obligate us to acquire any particular amount of common stock and does not have an expiration date. We may choose to purchase shares in the open market, from individual holders, through an accelerated share repurchase agreement or otherwise. Under the 2022 authorization, we repurchased shares, excluding excise tax, using $ 21.1 million and $ 33.9 million during fiscal 2024 and 2023, respectively. Prior to fiscal 2023, under the 2022 authorization, we used $ 11.0 million to repurchase shares, excluding excise tax. There were no share repurchases during fiscal 2025. The details of shares repurchased in the open market as part of the authorizations described above are as follows: Shares repurchased (in thousands) Year ended Authorization Amount authorized (in millions) Remaining available (in millions) 2025 2024 2023 2022 authorization $ 100.0 $ 33.5 — 1,967 1,877 Preferred stock We have authorized 20.0 million shares of blank check preferred stock. The blank check preferred stock is issuable in one or more series, each with such designations, preferences, rights, qualifications, limitations and restrictions as our Board may determine and set forth in supplemental resolutions at the time of issuance, without further shareholder action. The initial series of blank check preferred stock authorized by the Board was designated as Series A Preferred Stock. We had no outstanding shares of preferred stock in any of the years presented. Shareholder Rights Agreement On May 14, 2025, our Board adopted a limited duration shareholder rights agreement (the “Rights Agreement”). Pursuant to the Rights Agreement, TrueBlue issued, by means of a dividend, one preferred share purchase right (a “Right”) for each outstanding share of TrueBlue common stock to shareholders of record on May 28, 2025. Initially, these Rights are not exercisable and will trade with, and be represented by, the shares of TrueBlue common stock. If exercisable, each Right will entitle the registered holder to purchase from the company one one-hundredth of a share of Series A Junior Participating Preferred Stock (the “Series A Preferred”) of the company at a price of $ 30 per one one-hundredth of a share of Series A Preferred, subject to certain anti-dilution adjustments. The Rights are not exercisable until the earlier of (a) ten days after a public announcement that a person or group has acquired, or obtained the right to acquire, beneficial ownership of 15 % (or 20 % in the case of a passive institutional investor) or more of TrueBlue common stock (including certain synthetic equity positions created by derivative securities, which are treated as beneficial ownership of the number of shares of TrueBlue common stock equivalent to the economic exposure created by the synthetic equity position, subject to certain specified conditions) (an “Acquiring Person”) or (b) ten business days (or a later date determined by our Board) after a person or group begins a tender or an exchange offer that, if completed, would result in that person or group becoming an Acquiring Person. The Rights Agreement will expire on May 13, 2026, unless prior to such date shareholder approval has been obtained to extend the term of the Rights Agreement, or the Rights are earlier redeemed, exchanged or terminated by the company, as provided in the Rights Agreement. The Rights Agreement is intended to reduce the likelihood that any entity, person or group is able to gain control of TrueBlue through open market accumulation without paying all shareholders an appropriate control premium or providing the Board with sufficient opportunity to make informed judgments and take actions that are in the best interests of all shareholders. The Rights Agreement is not intended to interfere with any merger or other business combinations approved by the Board. Page - 75 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 11: STOCK-BASED COMPENSATION We record stock-based compensation expense for restricted stock awards, restricted stock units, performance share units (collectively, “stock-based awards”), and shares purchased under an employee stock purchase plan (“ESPP”). Refer to Note 1: Summary of Significant Accounting Policies for more information on how we measure and recognize stock-based compensation expense. Our 2016 Omnibus Incentive Plan (“Incentive Plan”), effective May 11, 2016, applies to directors, officers, employees and consultants of the company and permits the granting of nonqualified and incentive stock options, restricted stock awards, performance share units (“PSUs”), restricted stock units (“RSUs”) and stock appreciation rights. At the time of adoption, there were 1.5 million shares available for issuance. Additional shares were authorized under the Incentive Plan of 1.8 million shares on May 9, 2018, 0.7 million shares on May 11, 2023, 0.8 million shares on May 15, 2024, and 1.5 million shares on May 14, 2025. Stock-based awards Under the Incentive Plan, stock-based awards are granted to the Board, executive officers and key employees. Stock-based awards granted to executive officers and key employees generally vest annually over three or four years . For fiscal 2025, RSUs granted to members of our Board vest on the one year anniversary of the grant date. Prior to fiscal 2025, RSUs granted to members of our Board vested in the fourth quarter of the same fiscal year in which the shares were granted. Receipt of the vested shares may be deferred until after a director leaves the Board. PSUs are only granted to certain executive officers. Vesting of PSUs is contingent upon the achievement of return on equity, profitability, individual performance, or relative total shareholder return (“rTSR”) goals at the end of each performance period, which is generally three years . Each PSU is equivalent to one share of common stock. The grant-date fair value of PSUs that are contingent on rTSR is calculated using a Monte Carlo simulation. The following assumptions were used in estimating this fair value of these awards granted in fiscal 2025: 2025 Risk-free interest rate (1) 3.9 % Expected dividend yield (2) — % Expected term (years) 3.0 Expected volatility (3) 49.7 % (1) The average risk-free interest rate was based on the zero-coupon rate derived from the Treasury Constant Maturities yield curve corresponding to the expected term in effect as of the grant date. (2) The expected dividend yield was not relevant as we did not pay dividends on common stock and do not currently expect to pay dividends during the term of the stock awards granted. (3) We determined expected volatility using the change in our stock price over the historical expected term. Stock-based award activity for the fiscal year ended December 28, 2025, was as follows: (shares in thousands) Shares Weighted-average grant-date fair value Non-vested at beginning of period 2,008 $ 15.29 Granted (1) 1,633 $ 6.06 Vested ( 461 ) $ 16.13 Forfeited ( 292 ) $ 16.99 Non-vested at the end of the period 2,888 $ 9.77 (1) Includes 0.2 million shares of PSUs that are contingent on a market-based performance criteria. These shares had a fair market value of $5.50 using the Monte Carlo simulation discussed above. The following table summarizes the weighted-average grant-date fair value per share for stock-based awards granted: 2025 2024 2023 Weighted-average grant-date fair value $ 6.06 $ 11.19 $ 17.77 As of December 28, 2025, total estimated unrecognized stock-based compensation expense was $ 8.8 million. We expect to recognize this expense over a weighted average remaining period of 1.5 years. The total fair value of stock-based awards that vested during fiscal 2025, 2024 and 2023 was $ 3.1 million, $ 5.7 million and $ 12.2 million, respectively. Page - 76 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Employee Stock Purchase Plan At the time of adoption in 2010, there was 1.0 million shares of common stock authorized for purchase under our ESPP. Effective May 11, 2023, an additional 1.0 million shares of common stock were authorized for purchase under our ESPP. The plan allows eligible employees to contribute up to 10 % of their earnings toward the monthly purchase of the company’s common stock. The employee’s purchase price is 85 % of the lesser of the company’s common stock price on either the first day or the last day of each calendar month. We consider our ESPP to be a component of stock-based compensation and accordingly we recognize compensation expense over the requisite service period for stock purchases made under the plan. The requisite service period begins on the enrollment date and ends on the purchase date, the duration of which is one month . The following table summarizes transactions under our ESPP: (shares in thousands) 2025 2024 2023 Shares issued 95 79 63 Average price per share $ 4.77 $ 8.74 $ 13.58 Stock-based compensation expense Total stock-based compensation expense for fiscal 2025, 2024 and 2023, which is included in SG&A expense on our Consolidated Statements of Operations and Comprehensive Income (Loss), was $ 7.3 million, $ 7.6 million and $ 13.9 million, respectively. The related tax benefit, calculated using our statutory tax rate, was $ 1.5 million, $ 1.6 million and $ 2.9 million for fiscal 2025, 2024 and 2023, respectively. NOTE 12: DEFINED CONTRIBUTION PLANS We offer both qualified and non-qualified defined contribution plans to eligible employees. Participating employees may elect to defer and contribute a portion of their eligible compensation. The plans offer discretionary matching contributions. The liability for the non-qualified plan was $ 44.8 million and $ 43.3 million as of December 28, 2025 and December 29, 2024, respectively, of which $ 5.2 million and $ 5.2 million have been included in accrued wages and benefits on our Consolidated Balance Sheets. The net expense related to our qualified and non-qualified deferred compensation plans totaled $ 2.2 million, $ 3.3 million and $ 4.1 million for fiscal 2025, 2024 and 2023, respectively, and is recorded in SG&A expense on our Consolidated Statements of Operations and Comprehensive Income (Loss). The net expense includes changes in cash surrender value of the company-owned life insurance policies held to support the deferred compensation liability, premiums incurred for and proceeds received from company-owned life insurance, unrealized gains (losses) on deferred compensation liabilities, as well as our discretionary matching contributions. Refer to Note 4: Restricted Cash, Cash Equivalents and Investments for additional details on deferred compensation assets. Page - 77 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 13: INCOME TAXES U.S. and foreign components of loss before tax expense (benefit) was as follows: (in thousands) 2025 2024 2023 U.S. $ ( 51,101 ) $ ( 97,733 ) $ ( 27,773 ) Foreign 5,470 9,209 7,128 Loss before tax expense (benefit) $ ( 45,631 ) $ ( 88,524 ) $ ( 20,645 ) The provision for income taxes is comprised of the following: (in thousands) 2025 2024 2023 Current taxes: Federal $ ( 87 ) $ 150 $ 329 State 550 1,241 582 Foreign 2,515 1,771 2,817 Total current taxes 2,978 3,162 3,728 Deferred taxes: Federal 35 28,484 ( 8,109 ) State ( 172 ) 5,295 ( 1,383 ) Foreign ( 512 ) 283 ( 708 ) Total deferred taxes ( 649 ) 34,062 ( 10,200 ) Income tax expense (benefit): Federal ( 52 ) 28,634 ( 7,780 ) State 378 6,536 ( 801 ) Foreign 2,003 2,054 2,109 Total income tax expense (benefit) $ 2,329 $ 37,224 $ ( 6,472 ) Page - 78 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Our tax provision and our effective tax rate are subject to variation due to several factors, including variability in our pre-tax and taxable income or loss by jurisdiction, tax credits, government audit developments, changes in laws, regulations and administrative practices, valuation allowances recorded on deferred tax assets, and relative changes in expenses or losses for which tax benefits are not recognized. Additionally, our effective tax rate can be more or less volatile based on the amount of pre-tax income or loss. For example, the impact of discrete items, tax credits, non-deductible expenses and valuation allowance on our effective tax rate can be greater when our pre-tax income or loss is lower. The items accounting for the difference between income taxes computed at the statutory federal income tax rate and income taxes reported on the Consolidated Statements of Operations and Comprehensive Income (Loss) are as follows: (in thousands, except percentages) 2025 % 2024 % 2023 % Income tax expense (benefit) based on U.S. federal statutory rate $ ( 9,583 ) 21.0 % $ ( 18,590 ) 21.0 % $ ( 4,335 ) 21.0 % Increase (decrease) resulting from: State and local tax effects State and local income taxes, net of federal income tax effect (1) 550 ( 1.2 ) 1,341 ( 1.5 ) ( 1,258 ) 6.1 Foreign tax effects Canada Foreign withholdings 81 ( 0.2 ) 87 ( 0.1 ) 257 ( 1.2 ) Other 155 ( 0.3 ) ( 200 ) 0.2 ( 71 ) 0.4 India Statutory tax rate difference between India and U.S. 356 ( 0.8 ) 384 ( 0.4 ) 579 ( 2.8 ) India tax holiday ( 324 ) 0.7 ( 406 ) 0.5 ( 423 ) 2.0 Other 123 ( 0.3 ) 1 — 4 — Other foreign jurisdictions 463 ( 0.9 ) 254 ( 0.2 ) 249 ( 1.2 ) Tax credits Hiring tax credits ( 2,700 ) 5.9 ( 5,376 ) 6.1 ( 6,325 ) 30.6 Foreign tax credits ( 478 ) 1.0 — — — — Change in valuation allowance 12,704 ( 27.8 ) 57,626 ( 65.1 ) ( 58 ) 0.3 Nontaxable or non-deductible items Executive compensation 206 ( 0.5 ) 865 ( 1.0 ) 2,036 ( 9.9 ) Goodwill and intangible asset impairment charge — — — — 2,287 ( 11.1 ) Wages on hiring tax credits 567 ( 1.2 ) 1,129 ( 1.3 ) 1,328 ( 6.4 ) Company-owned life insurance ( 1,035 ) 2.3 ( 1,037 ) 1.2 ( 1,205 ) 5.8 Meals & entertainment 131 ( 0.3 ) 133 ( 0.2 ) 219 ( 1.1 ) Stock-based compensation 1,038 ( 2.3 ) 899 ( 1.0 ) 724 ( 3.5 ) Other 109 ( 0.3 ) 95 ( 0.1 ) 97 ( 0.5 ) Change in unrecognized tax benefits ( 136 ) 0.3 ( 99 ) 0.1 ( 206 ) 1.0 Other adjustments 102 ( 0.2 ) 118 ( 0.2 ) ( 371 ) 1.8 Total income tax expense (benefit) and effective tax rate $ 2,329 ( 5.1 ) % $ 37,224 ( 42.0 ) % $ ( 6,472 ) 31.3 % (1) State taxes in the following states make up the majority (greater than 50%) of the tax expense (benefit) for the years presented: a. 2025 - Georgia, Maryland, Oregon, Tennessee and Texas b. 2024 - Georgia, Maryland, Oregon, Tennessee and Texas c. 2023 - California, Georgia, Indiana, Louisiana, Maryland, Mississippi, New York, Pennsylvania, South Carolina, Tennessee and Texas Our effective tax rate for fiscal 2025 was ( 5.1 )%. The difference between the statutory federal income tax rate of 21.0 % and our effective income tax rate was primarily due to the valuation allowance against our U.S. federal and state and certain foreign deferred tax assets. Of the total goodwill and intangible asset impairment charge of $ 9.5 million recorded during fiscal 2023, $ 8.9 million (tax effect of $ 2.3 million) related to goodwill from a stock acquisition, and accordingly was not deductible for tax purposes. Page - 79 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. We have completed our evaluation of the impact of the OBBBA on our financial statements and the impact was immaterial. The Organization for Economic Co-operation and Development (the ”OECD”) has introduced a framework to implement a global minimum corporate tax of 15%, referred to as “Pillar Two.” In January 2026, the OECD issued additional guidance, including a safe harbor framework for certain U.S.-parented groups. We have determined that “Pillar Two” did not have a material impact on our financial statements. The federal Work Opportunity Tax Credit (“WOTC”), our primary hiring tax credit, is designed to encourage employers to hire workers from certain targeted groups with higher than average unemployment rates. WOTC is generally calculated as a percentage of wages over a twelve-month period up to worker maximums by targeted groups. Based on historical results and business trends, we estimate the amount of WOTC we expect to earn related to wages of the current year. However, the estimate is subject to variation because 1) a small percentage of our workers qualify for one or more of the many targeted groups; 2) the targeted groups are subject to different incentive credit rates and limitations; 3) credits fluctuate depending on economic conditions and qualified worker retention periods; and 4) state and federal offices can delay their credit certification processing and have inconsistent certification rates. We recognize an adjustment to prior year hiring tax credits if credits certified by government offices differ from original estimates. The U.S. Congress has approved the WOTC program through the end of 2025. The components of deferred tax assets and liabilities were as follows: (in thousands) December 28, 2025 December 29, 2024 Deferred tax assets: Allowance for credit losses $ 573 $ 264 Accounts payable and other accrued expenses 3,731 8,630 Net operating loss carryforwards 29,490 17,971 Tax credit carryforwards 24,832 21,478 Accrued wages and benefits 6,117 5,702 Deferred compensation 11,719 11,411 Lease liabilities 14,207 15,242 Other 515 504 Total 91,184 81,202 Valuation allowance ( 80,316 ) ( 64,488 ) Total deferred tax asset, net of valuation allowance 10,868 16,714 Deferred tax liabilities: Prepaid expenses, deposits and other current assets ( 820 ) ( 526 ) Lease right-of-use assets ( 8,056 ) ( 12,295 ) Depreciation and amortization ( 49 ) ( 2,853 ) Workers’ compensation ( 934 ) ( 503 ) Total deferred tax liabilities ( 9,859 ) ( 16,177 ) Deferred income taxes, net $ 1,009 $ 537 Since deferred tax assets and liabilities attributable to different jurisdictions cannot be offset, deferred tax liabilities of $ 0.3 million and $ 0.3 million were included in other long-term liabilities on our Consolidated Balance Sheets as of December 28, 2025 and December 29, 2024, respectively. Our valuation allowance relates to certain deferred tax balances that we expect will not be utilized within the permitted carryforward periods as of December 28, 2025 and December 29, 2024. Based on our deferred tax asset realizability assessments performed during the fiscal year ended December 28, 2025, we maintained a valuation allowance against U.S. federal, state and certain foreign deferred tax assets. Our conclusion was driven by U.S. and certain foreign pre-tax losses beginning in 2023 and continuing into 2025, combined with the non-cash goodwill impairment charge of $ 59.1 million recorded during the fiscal year ended December 29, 2024. Changes to deferred taxes related to foreign currency translation were immaterial for fiscal 2025, 2024 and 2023. Page - 80 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The following table summarizes our credit carryforwards and net operating losses (“NOLs”) along with their respective valuation allowance as of December 28, 2025: (in thousands) Carryover tax benefit Valuation allowance Expected benefit Year expiration begins Year-end tax attributes: Federal WOTCs $ 24,355 $ ( 24,355 ) $ — 2042 Federal NOLs 22,034 ( 22,034 ) — Indefinite State NOLs 7,343 ( 7,343 ) — Various Foreign Tax Credits 478 ( 478 ) — 2031 Foreign NOLs 112 ( 112 ) — Indefinite Foreign alternative minimum tax credits 305 — 305 2034 Total $ 54,627 $ ( 54,322 ) $ 305 The activity related to the income tax valuation allowance was as follows: (in thousands) 2025 2024 2023 Beginning balance $ 64,488 $ 834 $ 2,152 Charged to expense 15,912 63,654 ( 58 ) Release of allowance — — ( 1,260 ) Other ( 84 ) — — Ending balance $ 80,316 $ 64,488 $ 834 As of December 28, 2025, our liability for unrecognized tax benefits was $ 0.3 million. If recognized, $ 0.2 million could impact our effective tax rate. In general, the tax years 2022 through 2024 remain open to examination by the major taxing jurisdictions where we conduct business. Interest and penalties accrued related to unrecognized tax benefits were immaterial as of December 28, 2025. Income taxes paid, net of refunds received, disaggregated by jurisdiction were as follows: (in thousands) 2025 2024 2023 Federal $ ( 6,617 ) $ ( 25 ) $ — State ( 204 ) 139 1,181 Foreign 1,974 97 3,990 Total taxes paid, net of refunds received $ ( 4,847 ) $ 211 $ 5,171 Income taxes paid, net of refunds received, exceeded 5% of total income taxes paid, net of refunds received, for the following individual jurisdictions: (in thousands) 2025 2024 2023 State California $ ( 574 ) $ ( 287 ) $ 328 Foreign Canada * $ ( 561 ) $ 1,376 India $ 361 $ ( 946 ) $ 1,074 United Kingdom $ 1,275 $ 1,736 $ 1,561 Australia * $ ( 653 ) * Netherlands * $ 306 * *Indicates the jurisdiction is immaterial for the period presented. Page - 81 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 14: NET INCOME (LOSS) PER SHARE Diluted common shares were calculated as follows: (in thousands, except per share data) 2025 2024 2023 Net loss $ ( 47,960 ) $ ( 125,748 ) $ ( 14,173 ) Weighted average number of common shares used in basic net loss per common share 29,849 30,177 31,317 Dilutive effect of non-vested stock-based awards — — — Weighted average number of common shares used in diluted net loss per common share 29,849 30,177 31,317 Net loss per common share: Basic $ ( 1.61 ) $ ( 4.17 ) $ ( 0.45 ) Diluted $ ( 1.61 ) $ ( 4.17 ) $ ( 0.45 ) Anti-dilutive shares 1,763 1,406 1,343 As we reported a loss for the fiscal years ended December 28, 2025, December 29, 2024 and December 31, 2023, all potentially dilutive securities were antidilutive and accordingly, basic net loss per share and diluted net loss per share were equal. Page - 82 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 15: SEGMENT INFORMATION Segment information Our operating segments and reportable segments are described below: Our PeopleReady reportable segment provides blue-collar, contingent staffing through the PeopleReady operating segment. PeopleReady provides on-demand and skilled labor in a broad range of industries that include construction, transportation, manufacturing, retail, hospitality and energy. Our PeopleManagement reportable segment provides contingent labor and outsourced industrial workforce solutions, primarily on-site at the client’s facility, through the following operating segments, which we have aggregated into one reportable segment in accordance with U.S. GAAP: • OnSite : On-site management and recruitment for the contingent industrial workforce of manufacturing, warehousing and distribution facilities; and • Centerline : Recruitment and management of contingent and dedicated commercial drivers to the transportation and distribution industries. Our PeopleSolutions reportable segment provides professional and specialized talent acquisition solutions, as well as workforce management and compliance services. During the fiscal first quarter of 2025, as a result of the Healthcare Staffing Professionals, Inc. acquisition, we renamed our historical ‘PeopleScout’ reportable segment to ‘PeopleSolutions’. During the fiscal second quarter of 2025, we eliminated PeopleScout MSP as an operating segment for segment reporting purposes, as our chief operating decision-maker (“CODM”) no longer regularly reviews the operating results of PeopleScout MSP, consistent with our strategy to simplify our operational structure. The following tables present our revenue from services by segment, with a reconciliation to total company revenue. The tables also present significant segment expense categories regularly provided to the CODM and included in the calculation of segment profit. Refer to Note 1: Summary of Significant Accounting Policies for definition of segment profit. Cost of services and SG&A expense for the individual segments, as presented in the tables below, exclude certain costs and benefits that are also excluded from the calculation of segment profit. Lastly, the tables include a reconciliation of segment profit to loss before tax expense (benefit). 2025 (in thousands) PeopleReady PeopleManagement PeopleSolutions Total company Revenue from services $ 883,887 $ 544,448 $ 187,662 $ 1,615,997 Cost of services 661,586 460,004 125,184 Selling, general and administrative expense 215,767 66,672 51,146 Total segment profit $ 6,534 $ 17,772 $ 11,332 $ 35,638 Corporate unallocated ( 23,884 ) Third-party processing fees for hiring tax credits ( 150 ) Amortization of software as a service assets ( 4,394 ) Acquisition/integration costs ( 932 ) Goodwill and intangible asset impairment charge ( 200 ) Right-of-use and other long-lived asset impairment charge ( 18,366 ) COVID-19 government subsidies, net of fees 8,573 Workforce reduction costs ( 9,361 ) Other costs, net ( 4,706 ) Depreciation and amortization (inclusive of depreciation included in cost of services) ( 28,852 ) Loss from operations ( 46,634 ) Interest and other income (expense), net 1,003 Loss before tax expense (benefit) $ ( 45,631 ) Page - 83 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 2024 (in thousands) PeopleReady PeopleManagement PeopleSolutions Total company Revenue from services $ 868,549 $ 542,201 $ 156,643 $ 1,567,393 Cost of services 614,860 456,096 91,484 Selling, general and administrative expense 247,906 70,986 53,007 Total segment profit $ 5,783 $ 15,119 $ 12,152 $ 33,054 Corporate unallocated ( 21,887 ) Third-party processing fees for hiring tax credits ( 240 ) Amortization of software as a service assets ( 6,162 ) Goodwill and intangible asset impairment charge ( 59,674 ) PeopleReady technology upgrade costs ( 8,807 ) COVID-19 government subsidies, net of fees 9,652 Workforce reduction costs ( 7,329 ) Other costs, net ( 1,821 ) Depreciation and amortization (inclusive of depreciation included in cost of services) ( 29,561 ) Loss from operations ( 92,775 ) Interest and other income (expense), net 4,251 Loss before tax expense (benefit) $ ( 88,524 ) 2023 (in thousands) PeopleReady PeopleManagement PeopleSolutions Total Company Revenue from services $ 1,096,318 $ 580,591 $ 229,334 $ 1,906,243 Cost of services 772,058 488,692 137,551 Selling, general and administrative expense 297,654 84,936 64,861 Total segment profit $ 26,606 $ 6,963 $ 26,922 $ 60,491 Corporate unallocated ( 31,507 ) Third-party processing fees for hiring tax credits ( 253 ) Amortization of software as a service assets ( 4,117 ) Goodwill and intangible asset impairment charge ( 9,485 ) PeopleReady technology upgrade costs ( 1,342 ) Executive leadership transition costs ( 5,788 ) COVID-19 government subsidies, net of fees ( 525 ) Workforce reduction costs ( 5,086 ) Other costs, net ( 417 ) Depreciation and amortization ( 25,821 ) Loss from operations ( 23,850 ) Interest and other income (expense), net 3,205 Loss before tax expense (benefit) $ ( 20,645 ) Asset information by reportable segment is not presented since we do not manage our segments on a balance sheet basis. Page - 84 Table of Contents NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Domestic and international revenue Our international operations are primarily in the United Kingdom, India, Canada and Australia. Revenue by region was as follows: (in thousands, except percentages) 2025 % 2024 % 2023 % United States $ 1,514,778 93.7 % $ 1,458,501 93.1 % $ 1,750,427 91.8 % International operations 101,219 6.3 108,892 6.9 155,816 8.2 Total revenue from services $ 1,615,997 100.0 % $ 1,567,393 100.0 % $ 1,906,243 100.0 % Concentrations of client risk No single client represented more than 10.0% of total company revenue for fiscal 2025, 2024 or 2023. Client concentration for our reportable segments was as follows: • No single client represented 10.0% or more of our PeopleReady reportable segment revenue for fiscal 2025, 2024, or 2023. • No single client represented 10.0% or more of our PeopleManagement reportable segment revenue for fiscal 2025. One client represented 11.4 % and 12.3 % of our PeopleManagement reportable segment revenue for 2024 and 2023, respectively. • One client represented 17.3 % and 11.8 % of our PeopleSolutions reportable segment revenue for fiscal 2025 and 2023, respectively. No single client represented 10.0% or more of our PeopleSolutions reportable segment revenue for fiscal 2024. Domestic and international long-lived assets A summary of long-lived assets information by region as of December 28, 2025 and December 29, 2024 was as follows: (in thousands, except percentages) 2025 % 2024 % United States $ 96,595 90.1 % $ 127,231 92.9 % International operations 10,567 9.9 9,705 7.1 Total long-lived assets $ 107,162 100.0 % $ 136,936 100.0 % Long-lived assets consist of property and equipment, net and operating lease right-of-use assets, net. No single foreign country’s long-lived assets represented more than 10% of the consolidated long-lived assets of the company as of December 28, 2025 or December 29, 2024. Page - 85 Table of Contents Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE Not applicable.