HireQuest Reports Financial Results for First Quarter 2026
Rhea-AI Summary
HireQuest (Nasdaq: HQI) reported first quarter 2026 revenue of $6.5 million, down 12.7% year over year, reflecting MRINetwork divestiture impacts. Net income rose to $1.6 million or $0.11 per diluted share, while adjusted EBITDA was $2.7 million.
System-wide sales were $102.6 million, down 13.4%. SG&A declined 18.8% to $4.3 million. Cash was $1.0 million with working capital of $32.5 million and $40.3 million in line-of-credit availability. A quarterly cash dividend of $0.06 per share was paid March 16, 2026.
AI-generated analysis. Not financial advice.
Positive
- Net income increased to $1.6 million from $1.4 million
- Diluted EPS rose to $0.11 from $0.10 year over year
- SG&A expenses decreased 18.8% to $4.3 million
- Interest and financing expense fell to $8,000 from $144,000
- Working capital remained strong at $32.5 million
- Quarterly cash dividend of $0.06 per share paid in March 2026
Negative
- Total revenue declined 12.7% to $6.5 million
- System-wide sales decreased 13.4% to $102.6 million
- Cash balance fell to $1.0 million from $3.9 million
- Total liabilities increased to $23.8 million from $19.9 million
- Adjusted EBITDA edged down to $2.7 million from $2.8 million
Key Figures
Market Reality Check
Peers on Argus
HQI was down 2.35% pre-release with light volume, while key peers showed mixed moves: TBI (-3.41%), KELYB (+3.88%), MHH (+1.54%), ATLN (+1.97%), BGSF (-0.78%). Only BGSF appeared in momentum scans, moving modestly higher.
Previous Earnings Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Mar 30 | Q4/FY 2025 earnings | Positive | +1.9% | Full-year revenue down but net income up and balance sheet strengthened. |
| Nov 06 | Q3 2025 earnings | Positive | +15.5% | Return to profitability with strong adjusted net income and EBITDA despite revenue dip. |
| Aug 07 | Q2 2025 earnings | Negative | -1.0% | Double-digit declines in revenue, net income, and system-wide sales versus prior year. |
| May 08 | Q1 2025 earnings | Negative | -2.6% | Broad-based declines in revenue, royalties, sales, net income, and EBITDA. |
| Mar 27 | Q4/FY 2024 earnings | Positive | -9.1% | Improved net income and liquidity despite revenue and royalty declines. |
Earnings headlines have often moved HQI, with four of the last five earnings reports seeing price reactions that aligned with the generally positive or negative tone; only one showed a sharp negative divergence despite mixed but improving fundamentals.
Recent earnings releases for HireQuest have highlighted ongoing revenue and system‑wide sales pressure but preserved profitability, cost control, and consistent dividends. The Q4/FY 2025 report on Mar 30, 2026 showed lower revenue but higher net income and a stronger balance sheet, which drew a positive reaction. Earlier 2025 quarters showed revenue declines and shrinking system‑wide sales but steady $0.06 dividends and periods of strong positive reactions when profitability improved. Today’s Q1 2026 report continues this theme of resilient earnings against softer top‑line trends.
Historical Comparison
Past earnings reports for HQI produced an average move of 0.94%, with markets often rewarding profitability and balance-sheet strength even when revenue softened, a backdrop for interpreting this Q1 2026 update.
Across recent earnings cycles, HireQuest has reported declining revenue and system-wide sales but maintained profitability, adjusted EBITDA, and a recurring $0.06 quarterly dividend, positioning Q1 2026 as another step in that pattern of resilient earnings in a softer staffing environment.
Market Pulse Summary
This announcement highlights HireQuest’s Q1 2026 pattern of softer top‑line trends but resilient profitability, with total revenue at $6.5M and net income of $1.6M. System‑wide sales declined to $102.6M, yet SG&A fell to $4.3M and adjusted net income held at $1.8M. Compared with prior earnings cycles showing similar themes, investors may focus on revenue trajectory, system‑wide sales stability, and the sustainability of cost controls and dividends in upcoming quarters.
Key Terms
franchise royalties financial
SG&A expenses financial
workers' compensation financial
adjusted net income financial
adjusted EBITDA financial
system-wide sales financial
working capital financial
line of credit financial
AI-generated analysis. Not financial advice.
Rick Hermanns, HireQuest's President and Chief Executive Officer, commented, "The first quarter of 2026 was another solid period of operational execution and profitability for our business, reflecting the resiliency of our franchise staffing model in diverse markets. Our operational execution is supported by a strong balance sheet with no debt, and we remain committed to efficiently allocating capital and returning it to our shareholders. Looking ahead, we believe we're well positioned to benefit from a stabilizing job market as we continue to leverage our proven franchise model to drive consistently profitable results throughout the year."
First Quarter 2026 Review
Franchise royalties in the first quarter of 2026 were
Total revenue in the first quarter of 2026 was
SG&A expenses in the first quarter of 2026 were
Depreciation and amortization in the first quarter of 2026 was approximately
Interest and other financing expense in the first quarter of 2026 was approximately
Net income in the first quarter of 2026 was
Adjusted net income for the first quarter of 2026 was
Adjusted EBITDA for the first quarter of 2026 was
System-wide sales for the first quarter of 2026 decreased
Balance Sheet and Capital Structure
Cash was
Working capital as of March 31, 2026, was
As of March 31, 2026, assuming continued covenant compliance, availability under the line of credit was approximately
On March 16, 2026, the Company paid a quarterly cash dividend of
Conference Call
HireQuest will hold a conference call to discuss its financial results.
Date: | Tuesday, May 12, 2026 |
Time: | 4:30 p.m. Eastern Time |
Toll-free dial-in number: | 888-506-0062 |
International dial-in number: | 973-528-0011 |
Entry code: | 691937 |
Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization.
The conference call will be broadcast live and available for replay at https://www.webcaster5.com/Webcast/Page/2359/53938 and via the investor relations section of HireQuest's website at https://hirequest.com/.
A replay of the conference call will be available through Tuesday, May 26, 2026.
Toll-free replay number: | 877-481-4010 |
International replay number: | 919-882-2331 |
Replay passcode: | 53938 |
About HireQuest
HireQuest is a franchisor of staffing solutions with a footprint across the
Important Cautions Regarding Forward-Looking Statements
This news release includes and our directors and officers may make certain estimates and other forward-looking statements within the meaning of the safe harbor provisions of the
While we believe these statements are accurate, forward-looking statements are not historical facts and are inherently uncertain. They are based only on our current beliefs, expectations, and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy, and other future conditions. We cannot assure you that these expectations will materialize, and our actual results may be significantly different. Therefore, you should not place undue reliance on these forward-looking statements. Important factors that may cause actual results to differ materially from those contemplated in any forward-looking statements made by us include the following: the level of demand in and financial performance of the temporary staffing and permanent placement industry; the financial performance of our franchisees; our franchisees' and our customers' ability to navigate successfully the challenges posed by instability in the financial and capital markets and the overall economic environment including the impact of increases in the price of oil and gas and any potential recession; changes in customer demand; the extent to which we are successful in gaining new long-term relationships with customers or retaining existing ones, and the level of service failures that could lead customers to use competitors' services; workers' compensation expenses that fluctuate from period to period based on the mix of classifications, the level of payroll, recent claims resolution, and cumulative experience; significant investigative or legal proceedings including, without limitation, those brought about by the existing regulatory environment or changes in the regulations governing the temporary staffing and permanent placement industry and those arising from the action or inaction of our franchisees and temporary employees; strategic actions, including acquisitions and dispositions and our success in integrating acquired businesses including, without limitation, successful integration following the acquisitions of Ready Temporary Staffing, TEC Staffing Services, MRI Network, Snelling Staffing, LINK, Recruit Media, Dental Power, Temporary Alternatives, Inc., and subsequent or smaller acquisitions; the possibility that any strategic target will not agree to consummate a transaction or that any such transaction is consummated on different terms than currently anticipated; the possibility that conditions to the completion of a proposed transaction, including the receipt of any required shareholder approvals and any required regulatory approvals, will not be met; the possibility that we may be unable to achieve expected synergies and operating efficiencies within an expected time frame or at all and to successfully integrate any acquired operations with ours; the possibility that such integration may be more difficult, time-consuming, or costly than expected, or that operating costs, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, or suppliers) may be greater than expected following a proposed transaction or the public announcement of a proposed transaction; disruptions to our technology network including computer systems and software whether resulting from a cyber-attack or otherwise; natural events such as pandemics, severe weather, fires, floods, and earthquakes, or man-made or other disruptions of our operating systems or the economy including by war or political turmoil; and the factors discussed in the "Risk Factors" section and elsewhere in our Annual Report on Form 10-K filed with the SEC.
Any forward-looking statement made by us in this news release is based only on information currently available to us and speaks only as of the date on which it is made. The Company disclaims any obligation to update or revise any forward-looking statement, whether written or oral, that may be made from time to time, based on the occurrence of future events, the receipt of new information, or otherwise, except as required by law.
Non-
This document contains supplemental financial information determined by methods other than in accordance with accounting principles generally accepted in
Company Contact:
HireQuest
David Hartley, Chief Financial Officer
(800) 835-6755
Email: cdhartley@hirequest.com
Investor Relations Contact:
IMS Investor Relations
John Nesbett/Jennifer Belodeau
(203) 972-9200
Email: hirequest@imsinvestorrelations.com
- Tables Follow -
HireQuest
| |||
(in thousands, except share and par value data) | March 31, 2026 | December 31, 2025 | |
ASSETS | |||
Current assets | |||
Cash | $ 1,015 | $ 3,895 | |
Accounts receivable, net of allowance of | 44,668 | 39,281 | |
Notes receivable | 1,368 | 1,073 | |
Prepaid expenses, deposits, and other assets | 3,755 | 3,249 | |
Prepaid workers' compensation | 955 | 848 | |
Total current assets | 51,761 | 48,346 | |
Property and equipment, net | 3,996 | 4,050 | |
Workers' compensation claims payment deposit | 1,128 | 1,128 | |
Franchise agreements, net | 16,789 | 17,242 | |
Other intangible assets, net | 6,709 | 6,980 | |
Goodwill | 1,633 | 1,633 | |
Investment in unconsolidated affiliate | 635 | - | |
Deferred tax asset | 1,957 | 1,868 | |
Other assets | 297 | 279 | |
Notes receivable, net of current portion and allowance of | 5,553 | 5,599 | |
Intangible asset held for sale | 672 | 1,102 | |
Total assets | $ 91,130 | $ 88,227 | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |||
Current liabilities | |||
Accounts payable | $ 567 | $ 192 | |
Other current liabilities | 2,091 | 2,186 | |
Accrued payroll, benefits, and payroll taxes | 1,635 | 1,800 | |
Due to franchisees | 10,457 | 7,004 | |
Risk management incentive program liability | 1,573 | 1,237 | |
Workers' compensation claims liability | 2,937 | 2,929 | |
Total current liabilities | 19,260 | 15,348 | |
Workers' compensation claims liability, net of current portion | 2,178 | 2,232 | |
Franchisee deposits | 2,358 | 2,326 | |
Total liabilities | 23,796 | 19,906 | |
Commitments and contingencies (Note 11) | |||
Stockholders' equity | |||
Preferred stock - | - | - | |
Common stock - | 14 | 14 | |
Additional paid-in capital | 37,370 | 37,222 | |
Treasury stock, at cost - 0 and 48,849 shares, respectively | - | (146) | |
Retained earnings | 29,950 | 31,231 | |
Total stockholders' equity | 67,334 | 68,321 | |
Total liabilities and stockholders' equity | $ 91,130 | $ 88,227 | |
HireQuest
| |||
Three months ended | |||
(in thousands, except per share data) | March 31, 2026 | March 31, 2025 | |
Franchise royalties | $ 6,061 | $ 6,960 | |
Service revenue | 462 | 512 | |
Total revenue | 6,523 | 7,472 | |
Selling, general and administrative expenses | 4,269 | 5,255 | |
Depreciation and amortization | 778 | 734 | |
Income from operations | 1,476 | 1,483 | |
Other miscellaneous income | 16 | 131 | |
Interest income | 101 | 134 | |
Gain on divestiture | 248 | - | |
Interest and other financing expense | (8) | (144) | |
Net income before income taxes | 1,833 | 1,604 | |
Provision for income taxes | 264 | 169 | |
Net income from continuing operations | 1,569 | 1,435 | |
Loss from discontinued operations, net of tax | (9) | (72) | |
Net income | $ 1,560 | $ 1,363 | |
Basic earnings per share | |||
Continuing operations | $ 0.11 | $ 0.10 | |
Discontinued operations | - | - | |
Total | $ 0.11 | $ 0.10 | |
Diluted earnings per share | |||
Continuing operations | $ 0.11 | $ 0.10 | |
Discontinued operations | - | - | |
Total | $ 0.11 | $ 0.10 | |
Weighted average shares outstanding | |||
Basic | 13,873 | 13,925 | |
Diluted | 13,896 | 13,980 | |
HireQuest
| ||||
Three months ended | ||||
(in thousands) | March 31, 2026 | March 31, 2025 | ||
Net income | $ 1,560 | $ 1,363 | ||
Interest expense | 8 | 144 | ||
Provision for income taxes | 264 | 169 | ||
Depreciation and amortization | 778 | 734 | ||
EBITDA | 2,613 | 2,410 | ||
WOTC related costs | 104 | 150 | ||
Non-cash compensation | 148 | 239 | ||
Gain on divestiture | (248) | - | ||
Acquisition related charges, net | - | (103) | ||
Write down of notes receivable | 50 | 103 | ||
Adjusted EBITDA | $ 2,664 | $ 2,799 | ||
HireQuest
| ||||
Three months ended | ||||
(in thousands, except per share data) | March 31, 2026 | March 31, 2025 | ||
Net income | $ 1,560 | $ 1,363 | ||
Amortization of acquired intangibles | 567 | 541 | ||
Gain on divestiture | (248) | - | ||
Acquisition related charges, net | - | (103) | ||
Write down of note receivable | 50 | 103 | ||
Tax effect of adjustments (1) | (96) | (141) | ||
Adjusted net income | $ 1,833 | $ 1,763 | ||
Adjusted net income per diluted share | $ 0.13 | $ 0.13 | ||
Weighted average diluted shares outstanding | 13,896 | 13,980 | ||
(1) the tax effect includes the application of our estimated combined statutory rate of | ||||
HireQuest
| ||||
Three months ended | ||||
(in thousands) | March 31, 2026 | March 31, 2025 | ||
Core SG&A | $ 4,180 | $ 5,050 | ||
Net workers' compensation expense | 39 | 28 | ||
MRINetwork advertising fund expenses | - | 74 | ||
Impairment of notes receivable | 50 | 103 | ||
SG&A | $ 4,269 | $ 5,255 | ||
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SOURCE HireQuest