BBSI Reports Third Quarter 2025 Financial Results
Rhea-AI Summary
Barrett Business Services (NASDAQ: BBSI) reported third quarter 2025 results: revenues $318.9M (+8% YoY), gross billings $2.322B (+9% YoY), and net income $20.6M ($0.79 diluted EPS) versus $19.6M ($0.74) year-ago.
Average worksite employees rose 6% to 141,492. Unrestricted cash and investments were $109.8M and the company remained debt free. BBSI repurchased $7.5M of stock in Q3 and launched a $100M repurchase program with ≈$92.5M remaining. Quarterly dividend of $0.08 payable Dec 5, 2025. 2025 outlook: gross billings +8.5–9.5%, WSEs +6–8%, gross margin 2.9–3.0%.
Positive
- Revenue +8% YoY to $318.9M
- Gross billings +9% YoY to $2.322B
- Net income $20.6M ($0.79 diluted EPS)
- Unrestricted cash $109.8M and debt free at quarter end
- $100M authorized share repurchase program (≈$92.5M available)
Negative
- Gross margin down to 3.3% from 3.5% year-ago in the quarter
- Payroll taxes and benefits increased to 7.6% of gross billings from 7.2%
- Returned capital $31M YTD may limit near-term cash build versus growth needs
News Market Reaction
On the day this news was published, BBSI gained 1.19%, reflecting a mild positive market reaction. Argus tracked a trough of -6.7% from its starting point during tracking. Our momentum scanner triggered 26 alerts that day, indicating elevated trading interest and price volatility. This price movement added approximately $11M to the company's valuation, bringing the market cap to $951M at that time. Trading volume was elevated at 2.1x the daily average, suggesting notable buying interest.
Data tracked by StockTitan Argus on the day of publication.
- Revenues up
VANCOUVER, Wash., Nov. 05, 2025 (GLOBE NEWSWIRE) -- Barrett Business Services, Inc. (“BBSI” or the “Company”) (NASDAQ: BBSI), a leading provider of business management solutions, reported financial results for the third quarter ended September 30, 2025.
Third Quarter 2025 Financial Summary vs. Year-Ago Quarter
- Revenues up
8% to$318.9 million . - Gross billings up
9% to$2.32 billion . - Average worksite employees (“WSEs”) up
6% . - Net income increased to
$20.6 million , or$0.79 per diluted share, compared to net income of$19.6 million , or$0.74 per diluted share.
“BBSI delivered another strong quarter of controllable growth driven by new client additions,” said Gary Kramer, President and CEO of BBSI. “We continue to execute well against our strategy, leveraging our growth to drive sustained earnings expansion. Despite a more cautious economic environment, our continued ability to win new business and expand market share speaks to the strength of our differentiated model and the value we deliver to small and mid-sized businesses across the country. We remain focused on disciplined execution and investment in our people, technology, and service delivery to support long-term, sustainable growth.”
Third Quarter 2025 Financial Results
Revenues in the third quarter of 2025 increased
Total gross billings in the third quarter of 2025 increased
Workers’ compensation expense as a percent of gross billings was
Net income for the third quarter of 2025 increased to
Liquidity
As of September 30, 2025, unrestricted cash and investments were
Capital Allocation
On August 4, 2025, BBSI’s board of directors authorized the repurchase of up to
Under the Repurchase Program, BBSI repurchased
The Company paid
Through a combination of stock repurchases and dividends, year-to-date capital returned to shareholders totaled approximately
Outlook
BBSI expects the following for 2025:
- Gross billings growth of
8.5% to9.5% . - Growth in the average number of WSEs of
6% to8% . - Gross margin as a percent of gross billings of
2.9% to3.0% . - Effective annual tax rate to remain at
26% to27% .
Conference Call
BBSI will conduct a conference call on Wednesday, November 5, 2025, at 5:00 p.m. Eastern time (2:00 p.m. Pacific time) to discuss its financial results for the third quarter ended September 30, 2025.
BBSI’s CEO Gary Kramer and CFO Anthony Harris will host the conference call, followed by a question and answer period.
Date: Wednesday, November 5, 2025
Time: 5:00 p.m. Eastern time (2:00 p.m. Pacific time)
Toll-free dial-in number: 1-800-717-1738
International dial-in number: 1-646-307-1865
Conference ID: 10829
Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Group at 1-949-574-3860.
The conference call will be broadcast live and available for replay here and via the Investors section of the BBSI website at ir.bbsi.com.
A replay of the conference call will be available after 8:00 p.m. Eastern time on the same day through December 5, 2025.
Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay ID: 1110829
Key Performance Metrics
We report PEO revenues net of direct payroll costs because we are not the primary obligor for wage payments to our clients’ employees. However, management believes that gross billings and wages are useful in understanding the volume of our business activity and serve as important performance metrics in managing our operations, including the preparation of internal operating forecasts and establishing executive compensation performance goals. We therefore present for purposes of analysis gross billings and wage information for the three and nine months ended September 30, 2025 and 2024.
| (Unaudited) | (Unaudited) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| (in thousands) | 2025 | 2024 | 2025 | 2024 | ||||||||||||
| Gross billings | $ | 2,321,852 | $ | 2,138,510 | $ | 6,644,993 | $ | 6,075,094 | ||||||||
| PEO and staffing wages | $ | 2,017,499 | $ | 1,860,466 | $ | 5,766,932 | $ | 5,281,092 | ||||||||
In monitoring and evaluating the performance of our operations, management also reviews the following ratios, which represent selected amounts as a percentage of gross billings. Management believes these ratios are useful in understanding the efficiency and profitability of our service offerings.
| (Unaudited) | (Unaudited) | |||||||||||
| Percentage of Gross Billings | Percentage of Gross Billings | |||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||
| PEO and staffing wages | 86.9 | % | 87.0 | % | 86.8 | % | 86.9 | % | ||||
| Payroll taxes and benefits | 7.6 | % | 7.2 | % | 8.1 | % | 7.7 | % | ||||
| Workers' compensation | 2.2 | % | 2.3 | % | 2.2 | % | 2.4 | % | ||||
| Gross margin | 3.3 | % | 3.5 | % | 2.9 | % | 3.0 | % | ||||
We refer to employees of our PEO clients as WSEs. Management reviews average and ending WSE growth to monitor and evaluate the performance of our operations. Average WSEs are calculated by dividing the number of unique individuals paid in each month by the number of months in the period. Ending WSEs represents the number of unique individuals paid in the last month of the period.
| (Unaudited) | ||||||||||||||
| Three Months Ended September 30, | ||||||||||||||
| 2025 | Year-over-year % Growth | 2024 | Year-over-year % Growth | |||||||||||
| Average WSEs | 141,492 | 6.1 | % | 133,398 | 4.8 | % | ||||||||
| Ending WSEs | 140,409 | 5.8 | % | 132,698 | 3.3 | % | ||||||||
| (Unaudited) | ||||||||||||||
| Nine Months Ended September 30, | ||||||||||||||
| 2025 | Year-over-year % Growth | 2024 | Year-over-year % Growth | |||||||||||
| Average WSEs | 137,640 | 7.2 | % | 128,394 | 3.9 | % | ||||||||
| Ending WSEs | 140,409 | 5.8 | % | 132,698 | 3.3 | % | ||||||||
About BBSI
BBSI (NASDAQ: BBSI) is a leading provider of business management solutions, combining human resource outsourcing and professional management consulting to create a unique operational platform that differentiates it from competitors. The Company’s integrated platform is built upon expertise in payroll processing, employee benefits, workers’ compensation coverage, risk management and workplace safety programs, and human resource administration. BBSI’s partnerships help businesses of all sizes improve the efficiency of their operations. The company works with more than 8,100 PEO clients in all 50 states. For more information, please visit www.bbsi.com.
Forward-Looking Statements
Statements in this release about future events and financial outlook are forward-looking statements. Such statements involve known and unknown risks, uncertainties and other factors that may cause the actual results of the Company to be materially different from any future results expressed or implied by such forward-looking statements. Factors that could affect future results include: economic conditions in the Company’s service areas and the potential effects of changing governmental policies, including those related to immigration and tariffs; natural disasters; the effects of inflation on our operating expenses and those of our clients; the availability of certain fully insured medical and other health and welfare benefits to qualifying worksite employees; the effect of changes in the Company’s mix of services on gross margin; the Company’s ability to attract and retain clients and to achieve revenue growth; the availability of financing or other sources of capital; the Company’s relationship with its primary bank lender; the potential for material deviations from expected future workers’ compensation claims experience; changes in the workers’ compensation regulatory environment in the Company’s primary markets; PEO client benefits costs, particularly with regard to health insurance benefits; litigation costs; security breaches or failures in the Company’s information technology systems; the collectability of accounts receivable; changes in executive management; changes in effective payroll tax rates and federal and state income tax rates; the carrying value of deferred income tax assets and goodwill; the outcome of tax audits; the effect of changing interest rates and conditions in the global capital markets on the Company’s investment portfolio; and the potential for and effect of acquisitions, among others. Other important factors that may affect the Company’s prospects are described in the Company’s 2024 Annual Report on Form 10-K and in subsequent reports filed with the Securities and Exchange Commission under the Securities Exchange Act of 1934. Although forward-looking statements help to provide complete information about the Company, readers should keep in mind that forward-looking statements are less reliable than historical information. The Company undertakes no obligation to update or revise forward-looking statements in this release to reflect events or changes in circumstances that occur after the date of this release.
| Barrett Business Services, Inc. Condensed Consolidated Balance Sheets (Unaudited) | ||||||||
| September 30, | December 31, | |||||||
| (in thousands) | 2025 | 2024 | ||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 47,676 | $ | 55,367 | ||||
| Investments | 62,076 | 66,492 | ||||||
| Trade accounts receivable, net | 300,616 | 234,533 | ||||||
| Income taxes receivable | 326 | 2,662 | ||||||
| Prepaid expenses and other | 25,806 | 18,698 | ||||||
| Restricted cash and investments | 80,403 | 97,690 | ||||||
| Total current assets | 516,903 | 475,442 | ||||||
| Property, equipment and software, net | 63,915 | 56,781 | ||||||
| Operating lease right-of-use assets | 23,973 | 20,329 | ||||||
| Restricted cash and investments | 117,321 | 134,454 | ||||||
| Goodwill | 47,820 | 47,820 | ||||||
| Other assets | 6,097 | 6,205 | ||||||
| Deferred income taxes | 1,896 | 4,477 | ||||||
| Total assets | $ | 777,925 | $ | 745,508 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 5,842 | $ | 6,787 | ||||
| Accrued payroll and related benefits | 278,405 | 215,648 | ||||||
| Payroll taxes payable | 43,164 | 49,685 | ||||||
| Current operating lease liabilities | 6,945 | 6,231 | ||||||
| Current premium payable | 20,208 | 31,134 | ||||||
| Other accrued liabilities | 17,873 | 10,330 | ||||||
| Workers' compensation claims liabilities | 34,239 | 39,081 | ||||||
| Total current liabilities | 406,676 | 358,896 | ||||||
| Long-term workers' compensation claims liabilities | 74,945 | 89,365 | ||||||
| Long-term premium payable | 25,212 | 49,840 | ||||||
| Long-term operating lease liabilities | 18,225 | 15,215 | ||||||
| Customer deposits and other long-term liabilities | 12,722 | 10,788 | ||||||
| Stockholders' equity | 240,145 | 221,404 | ||||||
| Total liabilities and stockholders' equity | $ | 777,925 | $ | 745,508 | ||||
| Barrett Business Services, Inc. Consolidated Statements of Operations (Unaudited) | ||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| (in thousands, except per share amounts) | 2025 | 2024 | 2025 | 2024 | ||||||||||||
| Revenues: | ||||||||||||||||
| Professional employer services | $ | 299,685 | $ | 272,793 | $ | 864,781 | $ | 778,869 | ||||||||
| Staffing services | 19,264 | 21,485 | 54,391 | 60,842 | ||||||||||||
| Total revenues | 318,949 | 294,278 | 919,172 | 839,711 | ||||||||||||
| Cost of revenues: | ||||||||||||||||
| Direct payroll costs | 14,604 | 16,208 | 41,075 | 45,618 | ||||||||||||
| Payroll taxes and benefits | 176,270 | 154,109 | 536,553 | 464,814 | ||||||||||||
| Workers' compensation | 51,310 | 49,549 | 148,896 | 147,403 | ||||||||||||
| Total cost of revenues | 242,184 | 219,866 | 726,524 | 657,835 | ||||||||||||
| Gross margin | 76,765 | 74,412 | 192,648 | 181,876 | ||||||||||||
| Selling, general and administrative expenses | 49,886 | 49,060 | 142,912 | 137,051 | ||||||||||||
| Depreciation and amortization | 2,097 | 1,899 | 6,093 | 5,663 | ||||||||||||
| Income from operations | 24,782 | 23,453 | 43,643 | 39,162 | ||||||||||||
| Other income (expense): | ||||||||||||||||
| Investment income, net | 1,983 | 2,265 | 6,903 | 8,608 | ||||||||||||
| Interest expense | (45 | ) | (45 | ) | (133 | ) | (133 | ) | ||||||||
| Other, net | 32 | 31 | 131 | 124 | ||||||||||||
| Other income, net | 1,970 | 2,251 | 6,901 | 8,599 | ||||||||||||
| Income before income taxes | 26,752 | 25,704 | 50,544 | 47,761 | ||||||||||||
| Provision for income taxes | 6,133 | 6,076 | 12,492 | 11,568 | ||||||||||||
| Net income | $ | 20,619 | $ | 19,628 | $ | 38,052 | $ | 36,193 | ||||||||
| Basic income per common share | $ | 0.80 | $ | 0.75 | $ | 1.48 | $ | 1.38 | ||||||||
| Weighted average number of basic common shares outstanding | 25,688 | 26,052 | 25,696 | 26,133 | ||||||||||||
| Diluted income per common share | $ | 0.79 | $ | 0.74 | $ | 1.45 | $ | 1.35 | ||||||||
| Weighted average number of diluted common shares outstanding | 26,171 | 26,620 | 26,263 | 26,736 | ||||||||||||
Investor Relations:
Gateway Group, Inc.
Cody Slach
Tel 1-949-574-3860
BBSI@gateway-grp.com
FAQ
What were BBSI (NASDAQ: BBSI) third quarter 2025 revenues and EPS?
How much did BBSI gross billings grow in Q3 2025 and what were total billings?
What is BBSI's share repurchase program and how much remains?
When is BBSI's next dividend payment and how much is it?
What outlook did BBSI give for 2025 gross billings and WSE growth?
How much cash did BBSI hold and was the company carrying debt at quarter end?
