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Aug 30
Resources Connection Q1 2026 Earnings Report
Resources Connection reported Q1 2026 results with improved profitability and reduced net loss.
Key Takeaways
Despite a revenue decline, Resources Connection showed margin improvement, reduced SG&A expenses, and returned to adjusted profitability in Q1 FY2026.
Revenue declined to $120.2M from $136.9M YoY due to lower billable hours and delayed client projects.
Gross margin improved to 39.5% driven by better utilization and cost management.
Net loss narrowed significantly to $2.4M from $5.7M in Q1 FY2025.
Adjusted EPS turned positive at $0.03 versus breakeven last year.
Resources Connection
Resources Connection
Resources Connection Revenue by Segment
Resources Connection Revenue by Geographic Location
Revenue by Segment
On-Demand Talent Revenue
CapyFin.comConsulting Revenue
CapyFin.comEurope & APAC Revenue
CapyFin.comOutsourced Services Revenue
CapyFin.comAll Other Revenue
CapyFin.comRevenue by Geographic Location
Europe & APAC Revenue
CapyFin.comNorth America Revenue
CapyFin.com Forward Guidance
The company remains confident in its transformation strategy, focusing on higher-value consulting work while managing cost structure amidst macro uncertainty.
Positive Outlook
- Improved gross margin through better utilization and cost control
- Growing client demand in Europe
- Higher average bill rates across consulting
- Restructuring benefits reducing SG&A costs
- Expanded consulting opportunities with larger deal sizes
Challenges Ahead
- Revenue declined YoY due to reduced billable hours
- Ongoing macroeconomic uncertainty impacting project timing
- Soft labor markets slowing interim support demand
- Sales cycle for complex consulting deals remains elongated
- Asia Pacific region faced competitive pressure and lower client spend
Revenue & Expenses
Visualization of income flow from segment revenue to net income