Kelly Services, Inc. reported a decline in revenue for the third quarter of 2024, with total revenue from services amounting to $1,038.1 million, down 7.1% from $1,118.0 million in the same period of 2023. Year-to-date revenue also decreased by 12.8%, totaling $3,140.7 million compared to $3,603.5 million in 2023. The Professional & Industrial (P&I) segment saw a slight revenue drop to $370.4 million from $378.0 million, while the Science, Engineering & Technology (SET) segment experienced significant growth, increasing to $405.2 million from $295.7 million, largely due to the acquisition of Motion Recruitment Partners, LLC (MRP).

Gross profit for the third quarter decreased by 3.0% to $221.7 million, with a gross profit rate of 21.4%, up from 20.4% in the prior year. Year-to-date gross profit fell 11.4% to $641.1 million. Despite the revenue decline, earnings from operations improved to $2.6 million from $0.1 million in the previous year, driven by lower selling, general, and administrative (SG&A) expenses, which decreased by 4.1% in the third quarter.

Net earnings for the third quarter were $0.8 million, a significant drop of 88.4% from $6.6 million in the same quarter of 2023. However, year-to-date net earnings increased by 24.6% to $31.2 million compared to $25.0 million in 2023. Basic and diluted earnings per share for the third quarter were both $0.02, down from $0.18 in the prior year.

Strategically, Kelly Services completed the acquisition of MRP on May 31, 2024, for an adjusted purchase price of $440.0 million, which included $145.9 million in intangible assets. The acquisition is expected to enhance the company's staffing and consulting capabilities in technology and telecommunications. Additionally, the company sold its EMEA staffing operations for $110.6 million in January 2024, which contributed to a net receivable of $17.6 million as of the end of the third quarter.

The company’s cash and equivalents decreased significantly to $32.8 million from $125.8 million at the end of 2023, while trade accounts receivable rose to $1,248.6 million. Total current liabilities decreased to $841.0 million, and total stockholders’ equity increased to $1,281.9 million. The company also reported a debt-to-total capital ratio of 15.1% at the end of the third quarter, reflecting increased borrowings to finance the acquisition of MRP.

Overall, Kelly Services is navigating a challenging staffing market while focusing on strategic acquisitions and operational efficiencies to improve profitability.