Consulting firm Resources Connection's Q1 net loss widens on lower project volume

Resources Connection

07/10/2026 21:17

Overview
US professional services firm's Q1 revenue fell 18% yr/yr due to lower project volume
Adjusted loss per share for Q1 slightly beat analyst expectations
Company improved SG&A expenses through cost reductions, but net loss widened yr/yr

Outlook
Company says it is focused on improving sales execution and reducing costs
Company sees positive indicators in On-Demand Talent pricing and client relationships
Company expects improvements in revenue growth and profitability will take time to materialize

Result Drivers
LOWER PROJECT VOLUME - Co said reduced project volume and cautious client decision-making weighed on revenue and profitability
CLIENT CAUTION - Longer decision timelines and delayed project starts led to fewer billable hours, per co
PRICING DISCIPLINE - Co said pricing discipline helped support average bill rate in On-Demand Talent segment

Company press release: ID:nBwbP5Mlsa

Key Details
Metric
Beat/Miss
Actual
Consensus Estimate
Q1 Revenue
 
$98.09 mln
 
Q1 Adjusted Loss Per Share
Beat
$0.16
$0.17 (4 Analysts)
Q1 Net Loss
 
$7.97 mln
 
Q1 Adjusted EBITDA
 
-$3.6 mln
 
Q1 Gross Margin
 
37.4%
 
Q1 Gross Profit
 
$36.67 mln
 
Q1 Operating Income
 
-$7.31 mln
 

Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", 1 "hold" and 1 "sell" or "strong sell"
The average consensus recommendation for the business support services peer group is "buy"
Wall Street's median 12-month price target for Resources Connection, Inc. is $6.00, about 62.6% above its October 6 closing price of $3.69

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)