TrueBlue, Inc. (NYSE: TBI) grows Q2 2026 revenue 11.8% while margins tighten
Rhea-AI Filing Summary
TrueBlue, Inc. reported fiscal second-quarter 2026 revenue from services of $443,001 (in thousands), an 11.8% increase from $396,299 (in thousands) a year earlier, led by growth in skilled energy and commercial driving businesses. Gross profit declined to $91,582 (in thousands) and margin narrowed to 20.7% from 23.6%, mainly due to higher workers’ compensation costs, a shift toward lower-margin staffing, and the absence of prior-year COVID-19 subsidy benefits.
Selling, general and administrative expense fell 6.6% to $83,831 (in thousands), yet the company posted a net loss of $3,369 (in thousands) versus a $160 (in thousands) loss in the prior-year quarter, as interest and other swung to a $1,320 (in thousands) net expense. Year-to-date results include a $3,656 (in thousands) non-cash goodwill impairment tied to the Healthcare Staffing Professionals reporting unit and a $3,026 (in thousands) non-cash loss on the Tacoma headquarters classified as held-for-sale. Liquidity consisted of $23,253 (in thousands) of cash and cash equivalents, $82,400 (in thousands) of long-term debt and $56,200 (in thousands) of unused borrowing base under the $175,000 (in thousands) Amended Revolving Credit Facility, for total liquidity of $79,453 (in thousands).
Positive
- None.
Negative
- None.
Filing Explained
As of June 28, 2026, Tacoma’s sale remained incomplete after a $3.0 million write-down; HSP retained $13.7 million of goodwill.
Form 10-Q is an unaudited quarterly report, and TrueBlue’s filing discloses that its Tacoma headquarters remains held for sale but the transaction has not closed. The estimated value was reduced to
The filing also reports a non-cash goodwill impairment for the Healthcare Staffing Professionals reporting unit;
Completion of the Tacoma sale remains unresolved: the company says it remains under contract with the prospective buyer while actively marketing the property and pursuing alternative completion options.
Key Figures
Revenue from services Q2 2026: 443,001
Net loss Q2 2026: 3,369
Gross margin Q2 2026: 20.7%
+5 more
8 metrics
Revenue from services Q2 2026
443,001
Thirteen weeks ended June 28, 2026, in thousands
Net loss Q2 2026
3,369
Thirteen weeks ended June 28, 2026, in thousands
Gross margin Q2 2026
20.7%
Gross profit percentage of revenue for thirteen weeks ended June 28, 2026
SG&A expense Q2 2026
83,831
Selling, general and administrative expense in thousands, thirteen weeks ended June 28, 2026
Cash and cash equivalents
23,253
Balance sheet cash and cash equivalents in thousands as of June 28, 2026
Long-term debt
82,400
Revolving credit facility borrowings in thousands as of June 28, 2026
Workers’ compensation reserve, net
85,973
Discounted workers’ compensation reserve in thousands as of June 28, 2026
Goodwill impairment H1 2026
3,656
Goodwill and intangible asset impairment charge in thousands, twenty-six weeks ended June 28, 2026
Key Terms
workers’ compensation reserve, held-for-sale, goodwill impairment, valuation allowance, +2 more
6 terms
workers’ compensation reserve financial
"Our workers’ compensation reserve for claims below the deductible limit is discounted"
held-for-sale financial
"The disposal group has been classified as held-for-sale since all criteria were met"
An asset classified as "held-for-sale" is one a company has decided to sell rather than keep using, and expects to complete the sale within a short time frame. Investors care because the asset is removed from normal operations and is reported at the lower of its book value or estimated sale value, which can change the balance sheet, signal a shift in strategy, and affect expected cash proceeds—think of it as marking an item in a garage for immediate sale rather than keeping it in the attic.
goodwill impairment financial
"we recorded a non-cash goodwill impairment charge of $3.7 million"
Goodwill impairment occurs when a company’s valued reputation or brand strength, known as goodwill, is found to be worth less than previously recorded on its financial statements. This usually happens when the company's performance declines or market conditions change, signaling that the expected benefits from acquisitions or brand value are no longer as strong. It matters to investors because it can indicate that a company's assets are less valuable than initially thought, potentially affecting its overall financial health.
valuation allowance financial
"we maintained a valuation allowance against our U.S. federal, state and certain foreign deferred tax assets"
A valuation allowance is a reserve set aside to reduce the value of certain assets on a company's financial records when there is uncertainty about whether they will generate the expected benefits. It acts like a caution sign, indicating that some assets might not be fully recoverable or worth their recorded amount. This matters to investors because it provides a more realistic picture of a company's financial health and potential risks.
Amended Revolving Credit Facility financial
"The Amended Revolving Credit Facility provides for a revolving line of credit of up to $175.0 million"
An amended revolving credit facility is a company’s existing line of short‑term bank borrowing that has been renegotiated or changed — think of it like a business credit card whose limits, interest rate, or rules have been updated. Investors care because the amendments affect how easily and cheaply the company can access cash, how much debt it can take on, and what financial restrictions it must follow; those changes can influence growth plans, dividend capacity, and default risk.
segment profit financial
"We evaluate performance based on segment revenue and segment profit (loss)"
Segment profit is the portion of a company's earnings produced by a single business unit or division after subtracting the costs directly tied to that unit. It shows how much money that part of the company actually contributes, like checking which room in a house uses most of the electricity. Investors use it to identify strong or weak businesses inside a company, guide capital allocation, and make clearer comparisons between divisions.
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
How did TrueBlue (TBI) revenue perform in the fiscal second quarter of 2026?
TrueBlue’s revenue from services rose 11.8% to $443,001 (in thousands) for the thirteen weeks ended June 28, 2026, compared with $396,299 (in thousands) in the prior-year period, driven mainly by growth in skilled energy and commercial driving businesses.
What was TrueBlue (TBI) net income or loss for the quarter ended June 28, 2026?
TrueBlue reported a net loss of $3,369 (in thousands) for the thirteen weeks ended June 28, 2026, compared with a net loss of $160 (in thousands) a year earlier, as margin compression and higher interest and other expense offset revenue growth and lower SG&A.
Why did TrueBlue (TBI) gross margin decline in Q2 2026?
Gross margin declined to 20.7% from 23.6% mainly due to higher workers’ compensation costs, an unfavorable revenue mix shift toward lower-margin staffing businesses, and the benefit of COVID-19 government subsidies present in the prior-year period but not in 2026.
What non-cash charges affected TrueBlue (TBI) results in the first half of 2026?
First-half 2026 results include a $3,656 (in thousands) goodwill impairment for the Healthcare Staffing Professionals reporting unit and a $3,026 (in thousands) non-cash loss on the Tacoma headquarters classified as held-for-sale, both recorded in operating results.
What is TrueBlue (TBI) liquidity and debt position as of June 28, 2026?
As of June 28, 2026, TrueBlue had $23,253 (in thousands) of cash and cash equivalents, $82,400 (in thousands) of long-term debt, and $56,200 (in thousands) of unused borrowing base under its Amended Revolving Credit Facility, for total liquidity of $79,453 (in thousands).
How did TrueBlue (TBI) segment results vary in Q2 2026?
In Q2 2026, PeopleReady revenue grew 23.0% to $262,310 (in thousands), PeopleManagement revenue was stable at $133,839 (in thousands), and PeopleSolutions revenue declined 4.7% to $46,852 (in thousands), reflecting differing demand trends across staffing and recruitment offerings.
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
For the quarterly period ended: June 28, 2026
or
Commission File Number: 001-14543
____________________________________
(Exact name of registrant as specified in its charter)
______________________________________
| (State of incorporation) | (I.R.S. employer identification no.) | |||||||||||||
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (253 ) 383-9101
______________________________________
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | ☒ | Non-accelerated filer | ☐ | ||||||||||||||||
Smaller reporting company | Emerging growth company | |||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark if the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of July 26, 2026, there were 30,444,344 shares of the registrant’s common stock outstanding.
TrueBlue, Inc.
Table of Contents
| Page | ||||||||
| PART I. FINANCIAL INFORMATION | ||||||||
| Item 1. | Consolidated financial statements (unaudited) | 3 | ||||||
Consolidated Balance Sheets | 3 | |||||||
Consolidated Statements of Operations and Comprehensive Income (Loss) | 4 | |||||||
Consolidated Statements of Cash Flows | 5 | |||||||
Notes to consolidated financial statements | 6 | |||||||
| Item 2. | Management’s discussion and analysis of financial condition and results of operations | 22 | ||||||
| Item 3. | Quantitative and qualitative disclosures about market risk | 33 | ||||||
| Item 4. | Controls and procedures | 34 | ||||||
| PART II. OTHER INFORMATION | ||||||||
| Item 1. | Legal proceedings | 35 | ||||||
| Item 1A. | Risk factors | 35 | ||||||
| Item 2. | Unregistered sales of equity securities and use of proceeds | 36 | ||||||
| Item 3. | Defaults upon senior securities | 36 | ||||||
| Item 4. | Mine safety disclosures | 36 | ||||||
| Item 5. | Other information | 36 | ||||||
| Item 6. | Index to exhibits | 37 | ||||||
Signatures | 38 | |||||||
Page - 2
Table of Contents
PART I. FINANCIAL INFORMATION
Item 1. | CONSOLIDATED FINANCIAL STATEMENTS | ||||
TRUEBLUE, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands, except par value and share count data) | June 28, 2026 | December 28, 2025 | ||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
Accounts receivable, net of allowance of $ | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Income tax receivable | ||||||||
| Total current assets | ||||||||
| Property and equipment, net | ||||||||
Restricted cash, cash equivalents and investments | ||||||||
| Deferred income taxes, net | ||||||||
| Goodwill | ||||||||
| Intangible assets, net | ||||||||
| Operating lease right-of-use assets, net | ||||||||
| Workers’ compensation claims receivable, net | ||||||||
| Other assets, net | ||||||||
| Total assets | $ | $ | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and other accrued expenses | $ | $ | ||||||
| Accrued wages and benefits | ||||||||
| Income tax payable | ||||||||
| Current portion of workers’ compensation claims reserve | ||||||||
| Current operating lease liabilities | ||||||||
| Other current liabilities | ||||||||
| Total current liabilities | ||||||||
| Workers’ compensation claims reserve, less current portion | ||||||||
Long-term debt | ||||||||
| Long-term deferred compensation liabilities | ||||||||
| Long-term operating lease liabilities | ||||||||
| Other long-term liabilities | ||||||||
| Total liabilities | ||||||||
Commitments and contingencies (Note 9) | ||||||||
| Shareholders’ equity: | ||||||||
Preferred stock, $ | ||||||||
Common stock, no par value, | ||||||||
| Accumulated other comprehensive loss | ( | ( | ||||||
| Retained earnings | ||||||||
| Total shareholders’ equity | ||||||||
| Total liabilities and shareholders’ equity | $ | $ | ||||||
See accompanying notes to consolidated financial statements
Page - 3
Table of Contents
TRUEBLUE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(unaudited)
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||
| (in thousands, except per share data) | June 28, 2026 | June 29, 2025 | June 28, 2026 | June 29, 2025 | |||||||||||||
| Revenue from services | $ | $ | $ | $ | |||||||||||||
| Cost of services | |||||||||||||||||
| Gross profit | |||||||||||||||||
| Selling, general and administrative expense | |||||||||||||||||
| Depreciation and amortization (exclusive of depreciation included in cost of services) | |||||||||||||||||
| Loss on assets held-for-sale | |||||||||||||||||
| Goodwill and intangible asset impairment charge | |||||||||||||||||
| Loss from operations | ( | ( | ( | ( | |||||||||||||
Interest and other income (expense), net | ( | ( | |||||||||||||||
| Loss before tax expense | ( | ( | ( | ( | |||||||||||||
| Income tax expense | |||||||||||||||||
| Net loss | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
| Net loss per common share: | |||||||||||||||||
| Basic | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
| Diluted | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
| Weighted average shares outstanding: | |||||||||||||||||
| Basic | |||||||||||||||||
| Diluted | |||||||||||||||||
| Other comprehensive income (loss): | |||||||||||||||||
| Foreign currency translation adjustment | $ | ( | $ | $ | ( | $ | |||||||||||
| Comprehensive income (loss) | $ | ( | $ | $ | ( | $ | ( | ||||||||||
See accompanying notes to consolidated financial statements
Page - 4
Table of Contents
TRUEBLUE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
Twenty-six weeks ended | ||||||||
| (in thousands) | June 28, 2026 | June 29, 2025 | ||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | ( | $ | ( | ||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization (inclusive of depreciation included in cost of services) | ||||||||
| Non-cash loss on assets held-for-sale | ||||||||
| Goodwill and intangible asset impairment charge | ||||||||
| Provision for credit losses | ||||||||
| Stock-based compensation | ||||||||
| Deferred income taxes | ( | |||||||
| Non-cash lease expense | ||||||||
| Other operating activities | ( | ( | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | ( | |||||||
| Income taxes receivable and payable | ( | |||||||
| Other assets | ||||||||
| Accounts payable and other accrued expenses | ( | ( | ||||||
| Accrued wages and benefits | ( | |||||||
| Workers’ compensation claims reserve | ( | ( | ||||||
| Operating lease liabilities | ( | ( | ||||||
| Other liabilities | ( | |||||||
Net cash used in operating activities | ( | ( | ||||||
| Cash flows from investing activities: | ||||||||
| Capital expenditures | ( | ( | ||||||
| Acquisition of business, net of cash acquired | ( | |||||||
| Purchases of restricted held-to-maturity investments | ( | |||||||
Sales and maturities of restricted held-to-maturity investments | ||||||||
| Other | ||||||||
Net cash provided by (used in) investing activities | ( | |||||||
| Cash flows from financing activities: | ||||||||
| Net proceeds from employee stock purchase plans | ||||||||
| Common stock repurchases for taxes upon vesting of restricted stock | ( | ( | ||||||
| Net change in revolving credit facility | ||||||||
| Other | ( | ( | ||||||
Net cash provided by financing activities | ||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents | ( | ( | ||||||
Net change in cash, cash equivalents and restricted cash and cash equivalents | ( | ( | ||||||
Cash, cash equivalents and restricted cash and cash equivalents, beginning of period | ||||||||
Cash, cash equivalents and restricted cash and cash equivalents, end of period | $ | $ | ||||||
| Supplemental disclosure of cash flow information: | ||||||||
Cash paid during the period for: | ||||||||
| Interest | $ | $ | ||||||
Income taxes, net of refunds | $ | $ | ||||||
| Operating lease liabilities | $ | $ | ||||||
| Non-cash transactions: | ||||||||
| Property and equipment purchased but not yet paid | $ | $ | ||||||
| Right-of-use assets obtained in exchange for new operating lease liabilities | $ | $ | ||||||
See accompanying notes to consolidated financial statements
Page - 5
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Financial statement preparation
The accompanying unaudited consolidated financial statements (“financial statements”) of TrueBlue, Inc. (the “Company,” “TrueBlue,” “we,” “us,” and “our”) are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, certain information and footnote disclosures usually found in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. The financial statements reflect all adjustments which, in the opinion of management, are necessary to fairly state the financial statements for the interim periods presented. We follow the same accounting policies for preparing both quarterly and annual financial statements.
The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. The results of operations for the twenty-six weeks ended June 28, 2026 are not necessarily indicative of the results expected for the full fiscal year nor for any other fiscal period.
These financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 28, 2025.
Assets held-for-sale
We classify assets and liabilities as held-for-sale when management concludes that all relevant criteria have been met in accordance with U.S. GAAP. Assets held-for-sale are measured at the lower of their carrying value or fair value less costs to sell and are no longer depreciated or amortized. The carrying amounts of assets held-for-sale are adjusted each reporting period for subsequent changes in fair value less costs to sell, with losses recognized for any subsequent write-down to fair value less costs to sell, and gains recognized for any subsequent increase in fair value less costs to sell, but not in excess of the cumulative loss previously recognized.
Goodwill and indefinite-lived intangible assets
We evaluate goodwill and indefinite-lived intangible assets for impairment on an annual basis as of the first day of our fiscal second quarter, or whenever events or circumstances make it more likely than not that an impairment may have occurred. These events or circumstances could include a significant change in general economic conditions, deterioration in industry environment, changes in cost factors, declining operating performance indicators, legal factors, competition, client engagement, changes in the carrying amount of net assets, a sale or disposition of a significant portion of a reporting unit, or a sustained decrease in stock price. We monitor the existence of potential impairment indicators throughout the fiscal year.
Goodwill
We test for goodwill impairment at the reporting unit level. We consider our reporting units to be our operating segments or one level below (the component level) based on our organizational structure. Our reporting units with remaining goodwill as of June 28, 2026 were Centerline, PeopleScout, and Healthcare Staffing Professionals (“HSP”).
When evaluating goodwill for impairment, we may first assess qualitative factors to determine whether it is more likely than not the fair value of a reporting unit is less than its carrying amount. Qualitative factors include macroeconomic conditions, industry and market conditions, and overall Company financial performance. If, after assessing the totality of events and circumstances, we determine that it is more likely than not the fair value of the reporting unit is greater than its carrying amount, the quantitative impairment test is unnecessary.
The quantitative impairment test, if necessary, involves comparing the fair value of each reporting unit to its carrying value, including goodwill. Fair value reflects the price a market participant would be willing to pay in a potential sale of the reporting unit. If the fair value exceeds the carrying value, we conclude that no goodwill impairment has occurred. If the carrying value of the reporting unit exceeds its fair value, we recognize an impairment loss in an amount equal to the excess, not to exceed the carrying value of the goodwill. We consider a reporting unit’s fair value to be substantially in excess of its carrying value at a 20 % premium or greater.
Refer to Note 6: Goodwill and Intangible Assets for details on the results of the interim impairment test and impairment charge, annual impairment test, valuation methodologies, and inputs used in the fair value measurement.
Page - 6
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
Indefinite-lived intangible assets
We have indefinite-lived intangible assets for trademarks related to businesses within our PeopleManagement and PeopleSolutions segments. We evaluate our indefinite-lived intangible assets for impairment on an annual basis as of the first day of our fiscal second quarter, or whenever events or circumstances make it more likely than not that an impairment may have occurred. These events or circumstances could include significant changes in general economic conditions, deterioration in industry environment, changes in cost factors, declining operating performance indicators, legal factors, competition, client engagement, or a sale or disposition of a significant portion of the business. We monitor the existence of potential impairment indicators throughout the fiscal year.
When evaluating indefinite-lived intangible assets for impairment, we may first assess qualitative factors to determine whether it is more likely than not the fair value of the indefinite-lived intangible asset is less than its carrying amount. Qualitative factors include macroeconomic conditions, industry and market conditions and overall Company financial performance. If, after assessing the totality of events and circumstances, we determine that it is more likely than not the fair value of the indefinite-lived intangible asset is greater than its carrying amount, the quantitative impairment test is unnecessary.
The quantitative impairment test, if necessary, utilizes the relief from royalty method to determine the fair value of each of our trademarks. If the carrying value exceeds the fair value, we recognize an impairment loss in an amount equal to the excess, not to exceed the carrying value. Management uses considerable judgment to determine key assumptions, including forecasted future revenue, royalty rates and appropriate discount rates.
Refer to Note 6: Goodwill and Intangible Assets for additional details on the results of the interim impairment test and impairment charge, annual impairment test, valuation methodologies, and inputs used in the fair value measurements.
Recently adopted accounting standards
There were no new accounting standards adopted during the twenty-six weeks ended June 28, 2026 that had a material impact on our financial statements.
Recently issued accounting standards and disclosure rules not yet adopted
Disaggregation of income statement expenses
In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, “Income Statement (Subtopic 220-40): Disaggregation of Income Statement Expenses,” and in January 2025, the FASB issued ASU 2025-01, “Income Statement (Subtopic 220-40): Clarifying the Effective Date.” ASU 2024-03 requires disclosures about specific types of expenses included in the expense captions presented in the income statement as well as disclosure about selling expenses. ASU 2024-03, as clarified by ASU 2025-01, is effective for fiscal years beginning after December 15, 2026 (fiscal 2027 for TrueBlue) and interim periods beginning after December 15, 2027 (fiscal Q1 2028 for TrueBlue) on a prospective or retrospective basis. We are currently evaluating the impact of this ASU on our required disclosures.
Internal-use software
In September 2025, the FASB issued ASU 2025-06, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) - Targeted Improvements to the Accounting for Internal-Use Software.” This ASU eliminates references to project stages and instead requires an entity to start capitalizing software costs once both of the following criteria have been met: (1) management has authorized and committed to funding the software project, and (2) it is probable that the project will be completed and the software will be used for its intended function. This ASU is effective for fiscal years beginning after December 15, 2027 (fiscal 2028 for TrueBlue) and interim reporting periods within those annual reporting periods (fiscal Q1 2028 for TrueBlue). The guidance can be applied on a prospective basis, a modified basis for in-process projects or on a retrospective basis, and early adoption is permitted. We are currently evaluating the impact of this ASU; however, it is not anticipated to have a material impact on our consolidated financial statements.
Page - 7
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
Interim reporting
In December 2025, the FASB issued ASU 2025-11, “Interim Reporting (Topic 270) - Narrow-Scope Improvements.” This ASU clarifies interim disclosure requirements, provides a comprehensive list of interim disclosure requirements within Topic 270, and introduces a disclosure principle to help entities determine which events since the end of the last annual reporting period are material for disclosure. This ASU does not change the fundamental nature of interim reporting or expand or reduce existing interim disclosure requirements. This ASU is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027 (fiscal Q1 2028 for TrueBlue). The guidance can be applied on a prospective basis, or a retrospective basis for all or any prior periods, and early adoption is permitted. We are currently evaluating the impact of this ASU; however, it is not anticipated to have a material impact on our consolidated financial statements.
Government assistance
In December 2025, the FASB issued ASU 2025-10, “Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities.” This ASU provides authoritative guidance for the recognition, measurement and presentation of government grants received by a business entity. This ASU is effective for annual reporting periods beginning after December 15, 2028 (fiscal 2029 for TrueBlue) and interim periods within those annual periods (fiscal Q1 2029 for TrueBlue). The guidance can be applied on a modified prospective, modified retrospective, or retrospective basis; early adoption is permitted. We are currently evaluating the impact of this ASU on our consolidated financial statements and related disclosures.
NOTE 2: ACQUISITION
Effective January 31, 2025, we acquired all of the outstanding equity interests of Healthcare Staffing Professionals, Inc., a long-term staffing and permanent hiring solutions provider, primarily focused on healthcare positions in the U.S. This acquisition allows us to expand revenue in the healthcare end-market while also diversifying our business.
Under the terms of the share purchase agreement, the base purchase price of $42.0 million was adjusted for estimated unpaid pre-close liabilities of the selling shareholders, cash acquired and estimated excess working capital. The purchase price allocated to acquired assets and liabilities was cash consideration of $35.2 million. As part of the share purchase agreement, certain Healthcare Staffing Professionals, Inc. employees can earn up to an additional $14.0 million based on the financial performance of the business over the first two years after acquisition, which we have concluded would be treated as compensation expense. We have not recorded any contingent compensation expense associated with this acquisition, since we do not anticipate that this contingent compensation will be earned as of June 28, 2026. Any amounts probable of being paid out under the agreement would be expensed over the required service period. We incurred acquisition-related costs of $0.8 million for the twenty-six weeks ended June 29, 2025, which are included in selling, general and administrative (“SG&A”) expense on the Consolidated Statements of Operations and Comprehensive Income (Loss).
The following table reflects our final allocation of the purchase price to the fair value of assets acquired and liabilities assumed:
| (in thousands) | Purchase price allocation | ||||
| Purchase price allocated as follows: | |||||
| Cash and cash equivalents | $ | ||||
| Accounts receivable | |||||
| Prepaid expenses, deposits and other current assets | |||||
| Operating lease right-of-use assets | |||||
| Intangible assets | |||||
| Total assets acquired | |||||
| Accounts payable and other accrued expenses | |||||
| Accrued wages and benefits | |||||
| Income tax payable | |||||
| Operating lease liabilities | |||||
| Total liabilities assumed | |||||
| Net identifiable assets acquired | |||||
| Goodwill (1) | |||||
| Total cash consideration transferred | $ | ||||
Page - 8
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
(1) Goodwill represents the expected synergies with our existing businesses, the acquired assembled workforce, potential new clients and future cash flows after the acquisition of Healthcare Staffing Professionals, Inc., and is deductible for income tax purposes. We performed an interim goodwill impairment test associated with our HSP reporting unit as of the last day of our fiscal first quarter of 2026, which resulted in an impairment charge of $3.7 million. Goodwill remaining for the HSP reporting unit as of June 28, 2026 is $13.7 million. Refer to Note 6: Goodwill and Intangible Assets for additional details.
Intangible assets include identifiable intangible assets for customer relationships and trade names/trademarks. We estimated the fair value of the acquired identifiable intangible assets, which are subject to straight line amortization, using an income approach. These fair value measurements were based on Level 3 inputs under the fair value hierarchy.
The following table sets forth the components of identifiable intangible assets acquired, including immaterial measurement period adjustments, as of January 31, 2025:
| (in thousands, except percentages and estimated useful lives, in years) | Estimated fair value | Estimated useful life in years | Valuation method | Discount rate | ||||||||||
| Customer relationships | $ | Multi-period excess earnings | ||||||||||||
| Trade names/trademarks | Relief from royalty | |||||||||||||
| Total acquired identifiable intangible assets | $ | |||||||||||||
The acquired assets and assumed liabilities of Healthcare Staffing Professionals, Inc. are included on our Consolidated Balance Sheets as of June 28, 2026 and December 28, 2025, and the results of its operations are reported on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the twenty-six weeks ended June 28, 2026 and for the period from February 1, 2025 to June 29, 2025. The amount of revenue for Healthcare Staffing Professionals, Inc. included on our Consolidated Statements of Operations and Comprehensive Income (Loss) was $24.6 million and $27.7 million for the twenty-six weeks ended June 28, 2026 and June 29, 2025, respectively. The amount of income (loss) from operations for Healthcare Staffing Professionals, Inc. included on our Consolidated Statements of Operations and Comprehensive Income (Loss) was $(2.7 ) million and $0.6 million for the twenty-six weeks ended June 28, 2026 and June 29, 2025, respectively. Loss from operations includes a non-cash goodwill impairment charge of $3.7 million for the twenty-six weeks ended June 28, 2026. Refer to Note 6: Goodwill and Intangible Assets for additional details. Healthcare Staffing Professionals, Inc. results have been combined with our historical PeopleScout segment, which was renamed PeopleSolutions in fiscal 2025. We concluded the acquisition of Healthcare Staffing Professionals, Inc. was not material to our consolidated results of operations and, as such, pro forma financial information was not required.
Page - 9
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
NOTE 3: FAIR VALUE MEASUREMENT
Accounts receivable, accounts payable and other accrued expenses, accrued wages and benefits and related taxes approximate their fair values due to the short-term maturities of these assets and liabilities. Our long-term debt is related to a revolving credit agreement and its carrying value approximates fair value as the interest rates are variable and reflect current market rates.
Assets measured at fair value on a recurring basis
Our assets measured at fair value on a recurring basis consisted of the following:
| June 28, 2026 | ||||||||||||||
| (in thousands) | Total fair value | Quoted prices in active markets for identical assets (level 1) | Significant other observable inputs (level 2) | Significant unobservable inputs (level 3) | ||||||||||
| Cash and cash equivalents | $ | $ | $ | $ | ||||||||||
| Restricted cash and cash equivalents | ||||||||||||||
Cash, cash equivalents and restricted cash and cash equivalents (1) | $ | $ | $ | $ | ||||||||||
| Municipal debt securities | $ | $ | $ | $ | ||||||||||
| Corporate debt securities | ||||||||||||||
| Agency mortgage-backed securities | ||||||||||||||
| U.S. government and agency securities | ||||||||||||||
| Restricted investments classified as held-to-maturity (2) | $ | $ | $ | $ | ||||||||||
| December 28, 2025 | ||||||||||||||
| (in thousands) | Total fair value | Quoted prices in active markets for identical assets (level 1) | Significant other observable inputs (level 2) | Significant unobservable inputs (level 3) | ||||||||||
| Cash and cash equivalents | $ | $ | $ | $ | ||||||||||
| Restricted cash and cash equivalents | ||||||||||||||
Cash, cash equivalents and restricted cash and cash equivalents (1) | $ | $ | $ | $ | ||||||||||
| Municipal debt securities | $ | $ | $ | $ | ||||||||||
| Corporate debt securities | ||||||||||||||
| Agency mortgage-backed securities | ||||||||||||||
| U.S. government and agency securities | ||||||||||||||
| Restricted investments classified as held-to-maturity (2) | $ | $ | $ | $ | ||||||||||
(1)Cash, cash equivalents and restricted cash and cash equivalents include money market funds, deposits and investments with original maturities of three months or less.
(2)Refer to Note 4: Restricted Cash, Cash Equivalents and Investments for additional details on our held-to-maturity debt securities.
Assets measured at fair value on a nonrecurring basis
In addition to assets that are recorded at fair value on a recurring basis, assets held-for-sale, indefinite-lived intangible assets and our reporting units with remaining goodwill may be subject to nonrecurring fair value measurements.
Assets held-for-sale
As of June 28, 2026, all criteria for classifying our Tacoma headquarters office building and related assets (the “disposal group”) as held-for-sale were met. The fair value of the disposal group was estimated using a market approach, based on the sales comparison approach, which reflects pricing observed in recent market transactions for similar office properties, adjusted for property-specific factors. Because certain inputs to this valuation are not observable in active markets, the measurement is classified within Level 3 of the fair value hierarchy. Refer to Note 5: Supplemental Balance Sheet Information for additional details on our assets held-for-sale.
Page - 10
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
Goodwill
We performed an interim goodwill impairment test on the HSP reporting unit as of the last day of our fiscal first quarter of 2026. The fair value of the HSP reporting unit was estimated using an equal weighting of the income and market approaches. The various inputs to the fair value model are considered Level 3. Refer to Note 6: Goodwill and Intangible Assets for additional details on the interim impairment test and impairment charge, annual impairment test, valuation methodologies, and inputs used in the fair value measurement.
NOTE 4: RESTRICTED CASH, CASH EQUIVALENTS AND INVESTMENTS
The following is a summary of the carrying value of our restricted cash, cash equivalents and investments:
| (in thousands) | June 28, 2026 | December 28, 2025 | ||||||
| Cash collateral held by insurance carriers | $ | $ | ||||||
| Cash and cash equivalents held in Trust | ||||||||
| Investments held in Trust | ||||||||
| Company-owned life insurance policies | ||||||||
| Other restricted cash and cash equivalents | ||||||||
Total restricted cash, cash equivalents and investments | $ | $ | ||||||
Held-to-maturity
Restricted cash, cash equivalents and investments include collateral that has been provided or pledged to insurance carriers for workers’ compensation and state workers’ compensation programs. Our insurance carriers and certain state workers’ compensation programs require us to collateralize a portion of our workers’ compensation obligation. The collateral typically takes the form of cash and cash equivalents and highly rated investment grade securities, primarily in debt and asset-backed securities. The majority of our collateral obligations are held in a trust at the Bank of New York Mellon (“Trust”).
The amortized cost and estimated fair value of each of our held-to-maturity investments held in Trust, aggregated by investment category as of June 28, 2026 and December 28, 2025, were as follows:
| June 28, 2026 | ||||||||||||||
| (in thousands) | Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | ||||||||||
| Municipal debt securities | $ | $ | $ | ( | $ | |||||||||
| Corporate debt securities | ( | |||||||||||||
| Agency mortgage-backed securities | ||||||||||||||
| U.S. government and agency securities | ( | |||||||||||||
| Total held-to-maturity investments | $ | $ | $ | ( | $ | |||||||||
| December 28, 2025 | ||||||||||||||
| (in thousands) | Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | ||||||||||
| Municipal debt securities | $ | $ | $ | ( | $ | |||||||||
| Corporate debt securities | ( | |||||||||||||
| Agency mortgage-backed securities | ||||||||||||||
| U.S. government and agency securities | ( | |||||||||||||
| Total held-to-maturity investments | $ | $ | $ | ( | $ | |||||||||
Page - 11
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
The amortized cost and fair value by contractual maturity of our held-to-maturity investments are as follows:
| June 28, 2026 | ||||||||
| (in thousands) | Amortized cost | Fair value | ||||||
| Due in one year or less | $ | $ | ||||||
| Due after one year through five years | ||||||||
| Total held-to-maturity investments | $ | $ | ||||||
Actual maturities may differ from contractual maturities because the issuers of certain debt securities have the right to call or prepay their obligations without penalty. We have no significant concentrations of counterparties in our held-to-maturity investment portfolio.
Company-owned life insurance policies
We hold company-owned life insurance policies to support our deferred compensation liability. Unrealized gains and losses related to investments still held at June 28, 2026 and June 29, 2025, which are included in SG&A expense on our Consolidated Statements of Operations and Comprehensive Income (Loss), were as follows:
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||
| (in thousands) | June 28, 2026 | June 29, 2025 | June 28, 2026 | June 29, 2025 | |||||||||||||
| Unrealized gain, net | $ | $ | $ | $ | |||||||||||||
NOTE 5: SUPPLEMENTAL BALANCE SHEET INFORMATION
Accounts receivable allowance for credit losses
The activity related to the accounts receivable allowance for credit losses was as follows:
Twenty-six weeks ended | ||||||||
| (in thousands) | June 28, 2026 | June 29, 2025 | ||||||
| Beginning balance | $ | $ | ||||||
| Current period provision | ||||||||
| Write-offs | ( | ( | ||||||
| Foreign currency translation | ||||||||
| Ending balance | $ | $ | ||||||
Prepaid expenses and other current assets
The balance of prepaid expenses and other current assets was made up of the following:
| (in thousands) | June 28, 2026 | December 28, 2025 | ||||||
| Prepaid software agreements | $ | $ | ||||||
| Other prepaid expenses | ||||||||
Assets held-for-sale | ||||||||
| Other current assets | ||||||||
| Prepaid expenses and other current assets | $ | $ | ||||||
Page - 12
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
Assets held-for-sale
The disposal group has been classified as held-for-sale since all criteria were met, and continue to be as of June 28, 2026. While we remain under contract with the prospective buyer, the delay in closing is due to circumstances beyond our control, and we continue to actively market and pursue alternative options for completion of a sale within a reasonable timeframe. We have not altered our plan to sell the disposal group.
During the thirteen weeks ended June 28, 2026, due to certain non-performance issues on the part of the prospective buyer, we updated our estimate of fair value less costs to sell based on recent comparable market transactions. This assessment resulted in a revised estimated fair value, less costs to sell of $8.7 million, compared to the carrying value of $11.8 million. As a result, we recognized a non-cash loss of $3.0 million during the thirteen and twenty-six weeks ended June 28, 2026, which is included in our Consolidated Statements of Operations and Comprehensive Income (Loss). This is the first adjustment to the carrying value of the disposal group since it was classified as held-for-sale.
NOTE 6: GOODWILL AND INTANGIBLE ASSETS
Goodwill
The following table reflects changes in the carrying amount of goodwill during the period by reportable segment:
| (in thousands) | PeopleReady | PeopleManagement | PeopleSolutions | Total Company | |||||||||||||
| Balance at | December 28, 2025 | ||||||||||||||||
| Goodwill before impairment | $ | $ | $ | $ | |||||||||||||
| Accumulated impairment charge | ( | ( | ( | ( | |||||||||||||
Goodwill | |||||||||||||||||
| Impairment charge | ( | ( | |||||||||||||||
| Foreign currency translation | |||||||||||||||||
| Balance at | June 28, 2026 | ||||||||||||||||
| Goodwill before impairment | |||||||||||||||||
| Accumulated impairment charge | ( | ( | ( | ( | |||||||||||||
Goodwill | $ | $ | $ | $ | |||||||||||||
Interim impairment test
During the fiscal first quarter of 2026, the sustained decrease in share price and resulting decrease in market capitalization, as well as downward revisions to future revenue and profitability projections related to the HSP reporting unit due to reductions in government funding that has impacted certain HSP clients, resulted in management determining that a triggering event occurred for the HSP reporting unit. Therefore, we performed an interim goodwill impairment test for this reporting unit as of the last day of our fiscal first quarter of 2026. The fair value of the reporting unit was estimated using a weighting of the income and market valuation approaches. The income approach applied a fair value methodology to the reporting unit based on discounted cash flows. This analysis requires significant judgments, including estimation of future cash flows, which is dependent on internally-developed forecasts, estimation of the long-term rate of growth for our business, estimation of the useful life over which cash flows will occur, and determination of our weighted average cost of capital, which is risk-adjusted to reflect the specific risk profile of the reporting unit being tested. The weighted average cost of capital used in our most recent impairment test was 16.5 %. We also applied a market approach, which develops a value correlation based on the market capitalization of similar publicly traded companies, referred to as a multiple, to apply to the operating results of the reporting units. The primary market multiples to which we compare are revenue and earnings before interest, taxes, depreciation, and amortization. In our most recent interim impairment test associated with our HSP reporting unit, the market multiples were based on revenue. The income and market approaches were equally weighted in our most recent interim impairment test.
Page - 13
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
Based on our interim impairment test as of the last day of our fiscal first quarter of 2026, we concluded that the carrying amount of the HSP reporting unit exceeded its estimated fair value. Thus, we recorded a non-cash goodwill impairment charge of $3.7 million, which is included in goodwill and intangible asset impairment charge on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the twenty-six weeks ended June 28, 2026. The goodwill impairment was primarily driven by downward revisions to future projections associated with our HSP reporting unit, an increase in weighted average cost of capital selected, and a decline in market capitalization of similar publicly traded companies. The remaining goodwill balance for HSP as of June 28, 2026 was $13.7 million. Any significant adverse change in our near- or long-term projections or macroeconomic conditions could result in future impairment charges. We will continue to closely monitor the operational performance of this reporting unit.
Annual impairment test
We performed our annual impairment test for goodwill as of the first day of the fiscal second quarter of 2026 for all reporting units with remaining goodwill, including HSP. Based on our assessment of qualitative factors, we concluded it was more likely than not that the fair value of each reporting unit exceeded its carrying value, and the goodwill associated with each reporting unit was not impaired. As such, it was not necessary to perform a quantitative impairment analysis.
Additionally, following performance of the annual impairment test, we did not identify any events or circumstances that make it more likely than not that an impairment may have occurred during the thirteen weeks ended June 28, 2026.
Indefinite-lived intangible assets
We held indefinite-lived trade names/trademarks of $4.6 million and $4.6 million as of June 28, 2026 and December 28, 2025, respectively, related to businesses within our PeopleManagement and PeopleSolutions segments.
We performed our annual impairment test for indefinite-lived intangible assets as of the first day of our fiscal second quarter of 2026. Based on our quantitative assessment, we concluded that the fair value of each trademark was in excess of its carrying amount as of June 28, 2026, and therefore did not result in an impairment.
Following performance of the annual impairment test, we did not identify any events or conditions that make it more likely than not an impairment may have occurred. Accordingly, no impairment charge was recognized during the thirteen or twenty-six weeks ended June 28, 2026.
Page - 14
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
NOTE 7: WORKERS' COMPENSATION INSURANCE AND RESERVES
We provide workers’ compensation insurance for our associates and permanent employees. The majority of our current workers’ compensation insurance policies cover claims for a particular event above our $5.0 million deductible limit, on a “per occurrence” basis. This results in our business being substantially self-insured.
Our workers’ compensation reserve for claims below the deductible limit is discounted to its estimated net present value. The discount rates used to estimate net present value are based on average returns of “risk-free” U.S. Treasury instruments available during the year in which the liability was incurred and the weighted average duration of the payments against the self-insured claims. Payments made against self-insured claims are made over a weighted average period of approximately 3 years as of June 28, 2026. The weighted average discount rate was 3.2 % and 3.1 % at June 28, 2026 and December 28, 2025, respectively.
The following table presents a reconciliation of the undiscounted workers’ compensation reserve to the discounted workers’ compensation reserve for the periods presented:
| (in thousands) | June 28, 2026 | December 28, 2025 | ||||||
| Undiscounted workers’ compensation reserve (1) | $ | $ | ||||||
| Less discount on workers’ compensation reserve | ||||||||
| Workers’ compensation reserve, net of discount | ||||||||
| Less current portion | ||||||||
| Long-term portion | $ | $ | ||||||
(1)Amounts shown are net of discount related to claims above our self-insured limits (“excess claims”).
Payments made against self-insured claims were $24.5 million and $23.3 million for the twenty-six weeks ended June 28, 2026 and June 29, 2025, respectively.
Our workers’ compensation reserve includes estimated expenses related to claims above our self-insured limits (“excess claims”), and we record a corresponding receivable for the insurance coverage on excess claims based on the contractual policy agreements we have with insurance carriers. We discount this reserve and corresponding receivable to its estimated net present value using the discount rates based on average returns of “risk-free” U.S. Treasury instruments available during the year in which the liability was incurred and the weighted average duration of the payments against the excess claims. The discounted workers’ compensation reserve for excess claims was $20.2 million and $25.7 million as of June 28, 2026 and December 28, 2025, respectively. The discounted receivables from insurance companies, net of valuation allowance, were $20.2 million and $25.7 million as of June 28, 2026 and December 28, 2025, respectively.
Workers’ compensation cost consists primarily of changes in self-insurance reserves net of changes in discount, monopolistic jurisdictions’ premiums, insurance premiums and other miscellaneous expenses. Workers’ compensation cost of $11.4 million and $5.3 million was recorded in cost of services on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the thirteen weeks ended June 28, 2026 and June 29, 2025, respectively, and $21.4 million and $6.5 million for the twenty-six weeks ended June 28, 2026 and June 29, 2025, respectively.
Page - 15
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
NOTE 8: LONG-TERM DEBT
We have a revolving credit agreement under the Amended and Restated Credit Agreement dated February 9, 2024 (the “Revolving Credit Facility”), with Bank of America, N.A., PNC Bank, N.A., HSBC Bank USA, N.A., Wells Fargo Bank, N.A., and Key Bank, N.A. On January 30, 2026, the Revolving Credit Facility was further amended by the Second Amendment to Amended and Restated Credit Agreement (the “Second Amendment”), establishing the “Amended Revolving Credit Facility,” which is set to mature on February 9, 2029. The Amended Revolving Credit Facility provides for a revolving line of credit of up to $175.0 million. We have an option to increase the amount by $150.0 million, subject to lender approval. Included in the Amended Revolving Credit Facility is a $25.0 million sub-limit for swingline loans and a $25.0 million sub-limit for letters of credit.
The maximum amount we can borrow under the Amended Revolving Credit Facility is subject to a borrowing base and minimum excess availability covenant. The borrowing base is determined by eligible receivable accounts as defined in the Second Amendment, less specific availability reserves. The minimum excess availability covenant is the greater of (a) 12.5 % of the lesser of the borrowing base or the total line of credit and (b) $17.5 million. The minimum excess availability covenant may subsequently be replaced with a springing fixed charge coverage ratio covenant upon the satisfaction of meeting a minimum fixed charge coverage ratio test for two consecutive quarters occurring on or after September 27, 2026. The fixed charge coverage ratio covenant will thereafter apply when excess availability is below certain thresholds.
The following table presents the balances of the Revolving Credit Facility and Amended Revolving Credit Facility, as applicable:
| (in thousands) | June 28, 2026 | December 28, 2025 | ||||||
| Term SOFR Loans (1) | $ | $ | ||||||
| Base Rate Loan | ||||||||
| Swingline loans | ||||||||
| Long-term debt | ||||||||
| Letters of credit | ||||||||
| Total outstanding | $ | $ | ||||||
(1)One-month Term Secured Overnight Financing Rate (“SOFR”) Loans.
As of June 28, 2026, the borrowing base in effect was $150.0 million, leaving $56.2 million of unused borrowing base available.
Under the terms of the Amended Revolving Credit Facility, we have the option to borrow funds under the revolving line of credit as a Term SOFR Loan, for a one-, three- or six-month term, or as a Base Rate Loan, as defined in the Amended Revolving Credit Facility. Under a Term SOFR Loan, we are required to pay a variable rate of interest on funds borrowed based on the Term SOFR Screen Rate two days prior for the equivalent term, plus an adjustment of 0.10 %, plus an applicable spread between 1.75 % and 3.50 %. Under a Base Rate Loan we are required to pay a variable rate of interest on funds borrowed based on a base rate plus an applicable spread between 0.75 % and 2.50 %. The base rate is the greater of the one-month Term SOFR Screen Rate two days prior plus 1.00 %, the prime rate (as announced by Bank of America), or the federal funds rate plus 0.50 %. The applicable spread is determined by the consolidated leverage ratio, as defined in the Amended Revolving Credit Facility. As of June 28, 2026, the outstanding balance under Term SOFR loans carried an applicable spread on the base rate of 3.50 % and a weighted average base rate of 3.73 %, resulting in a weighted average interest rate of 7.23 %. The Term SOFR loans were primarily used to fund the acquisition of Healthcare Staffing Professionals, Inc. in the fiscal first quarter of 2025, and to support working capital requirements as revenue increased.
Under a swingline loan, we are required to pay a variable rate of interest on funds borrowed based on the base rate plus applicable spread between 0.75 % and 2.50 %, as described above. As of June 28, 2026, the applicable spread on the base rate was 2.50 % and the base rate was 6.75 %, resulting in an interest rate of 9.25 %.
A commitment fee between 0.35 % and 0.50 % is applied against the Amended Revolving Credit Facility’s unused borrowing capacity, with the specific rate determined by the consolidated leverage ratio, as defined in the Amended Revolving Credit Facility. Letters of credit are priced at a margin between 1.50 % and 3.25 %, with the specific rate determined by the consolidated leverage ratio, plus a fronting fee of 0.25 %.
Page - 16
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
Obligations under the Amended Revolving Credit Facility are guaranteed by TrueBlue and material U.S. domestic subsidiaries, and are secured by substantially all of the assets of TrueBlue and material U.S. domestic subsidiaries. The Amended Revolving Credit Facility contains customary representations and warranties, events of default, and affirmative and negative covenants, including, among others, financial covenants.
As of June 28, 2026, we remain in compliance with all the requirements of the Amended Revolving Credit Facility.
NOTE 9: COMMITMENTS AND CONTINGENCIES
Workers’ compensation commitments
We have provided our insurance carriers and certain states with commitments in the form and amounts listed below:
| (in thousands) | June 28, 2026 | December 28, 2025 | ||||||
| Cash collateral held by workers’ compensation insurance carriers | $ | $ | ||||||
| Cash and cash equivalents held in Trust | ||||||||
| Investments held in Trust | ||||||||
| Letters of credit (1) | ||||||||
| Surety bonds (2) | ||||||||
| Total collateral commitments | $ | $ | ||||||
(1)We have agreements with certain financial institutions to issue letters of credit as collateral.
(2)Our surety bonds are issued by independent insurance companies on our behalf and bear annual fees based on a percentage of the bond, which are determined by each independent surety carrier. These fees do not exceed 2.0 % of the bond amount, subject to a minimum charge. The terms of these bonds are subject to review and renewal every to four years and most bonds can be canceled by the sureties with as little as 60 days’ notice.
Legal contingencies and developments
We are involved in various proceedings arising in the normal course of conducting business. We believe the liabilities included in our financial statements reflect the probable loss that can be reasonably estimated and are immaterial. We also believe that the aggregate range of reasonably possible losses for the Company's exposure in excess of the amount accrued is expected to be immaterial to the Company. It remains possible that despite our current belief, material differences in actual outcomes or changes in management's evaluation or predictions could arise that could have a material effect on the Company's financial condition, results of operations or cash flows.
Page - 17
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
NOTE 10: SHAREHOLDERS' EQUITY
Changes in the balance of each component of shareholders’ equity during the reporting periods were as follows:
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||
| (in thousands) | June 28, 2026 | June 29, 2025 | June 28, 2026 | June 29, 2025 | |||||||||||||
| Common stock shares | |||||||||||||||||
| Beginning balance | |||||||||||||||||
Net issuance under equity plans | |||||||||||||||||
| Ending balance | |||||||||||||||||
| Common stock amount | |||||||||||||||||
| Beginning balance | $ | $ | $ | $ | |||||||||||||
| Current period activity | — | — | — | — | |||||||||||||
| Ending balance | |||||||||||||||||
| Retained earnings | |||||||||||||||||
| Beginning balance | |||||||||||||||||
| Net loss | ( | ( | ( | ( | |||||||||||||
Net issuance under equity plans | ( | ( | |||||||||||||||
| Stock-based compensation | |||||||||||||||||
| Ending balance | |||||||||||||||||
Accumulated other comprehensive loss | |||||||||||||||||
| Beginning balance, net of tax | ( | ( | ( | ( | |||||||||||||
Foreign currency translation adjustment | ( | ( | |||||||||||||||
| Ending balance, net of tax | ( | ( | ( | ( | |||||||||||||
| Total shareholders’ equity ending balance | $ | $ | $ | $ | |||||||||||||
NOTE 11: INCOME TAXES
Our income tax provision for interim periods is determined using an estimate of our annual effective tax rate, adjusted for any discrete items that are taken into account in the relevant period. Each quarter we update our estimate of the annual effective tax rate and, if our estimated tax rate changes, we make a cumulative adjustment. Our quarterly tax provision and quarterly estimate of our annual effective tax rate are subject to variation due to several factors, including variability in accurately predicting our full year pre-tax income or loss by jurisdiction, tax credits, government audit developments, changes in laws, regulations and administrative practices, valuation allowances recorded on deferred tax assets, and relative changes in expenses or losses for which tax benefits are not recognized. Additionally, our effective tax rate can be more or less volatile based on the amount of pre-tax income or loss. For example, the impact of discrete items, tax credits, and non-deductible expenses on our effective tax rate is greater when our pre-tax income or loss is lower.
We recognize deferred tax assets to the extent we believe it is more likely than not the asset will be realized. Quarterly, management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit the use of existing deferred tax assets, including future reversals of existing taxable temporary differences, projected taxable income, tax-planning strategies, carryback potential if permitted, and the results of recent operations. A significant piece of objective negative evidence is the existence of a three-year cumulative loss. Such objective negative evidence limits the ability of management to consider other subjective evidence, such as projected taxable income. When appropriate, we record a valuation allowance to reduce deferred tax assets to the amount that is more likely than not to be realized.
During the twenty-six weeks ended June 28, 2026, we performed our deferred tax asset realizability assessments and, as a result, we maintained a valuation allowance against our U.S. federal, state and certain foreign deferred tax assets. Our conclusion was driven by U.S. and foreign pre-tax losses beginning in 2023 and continuing into 2026, combined with the non-cash goodwill impairment charge of $59.1 million recorded during fiscal 2024.
Page - 18
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
Our effective income tax rate for the twenty-six weeks ended June 28, 2026 was (6.7 )%. The difference between the statutory federal income tax rate of 21.0 % and our effective tax rate was primarily due to the valuation allowance against our U.S. federal, state and certain foreign deferred tax assets.
NOTE 12: NET INCOME (LOSS) PER SHARE
Diluted common shares were calculated as follows:
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||
| (in thousands, except per share data) | June 28, 2026 | June 29, 2025 | June 28, 2026 | June 29, 2025 | |||||||||||||
| Net loss | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
Weighted average number of common shares used in basic net loss per common share | |||||||||||||||||
| Dilutive effect of non-vested stock-based awards | |||||||||||||||||
Weighted average number of common shares used in diluted net loss per common share | |||||||||||||||||
| Net loss per common share: | |||||||||||||||||
| Basic | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
| Diluted | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
| Anti-dilutive shares | |||||||||||||||||
NOTE 13: SEGMENT INFORMATION
Our operating segments and reportable segments are described below:
Our PeopleReady reportable segment provides contingent staffing through the PeopleReady operating segment. PeopleReady provides on-demand and skilled labor in a broad range of industries that include construction, transportation, manufacturing, retail, hospitality and energy.
Our PeopleManagement reportable segment provides contingent labor and outsourced industrial workforce solutions, primarily on-site at the client’s facility, through the following operating segments, which we have aggregated into one reportable segment in accordance with U.S. GAAP:
•OnSite: On-site management and recruitment for the contingent industrial workforce of manufacturing, warehousing and distribution facilities; and
•Centerline: Recruitment and management of contingent and dedicated commercial drivers to the transportation and distribution industries.
Our PeopleSolutions reportable segment provides professional and specialized talent acquisition solutions, as well as workforce management and compliance services.
We evaluate performance based on segment revenue and segment profit (loss). Segment revenue is net of intercompany eliminations. Segment profit (loss) includes revenue, related cost of services, and ongoing operating expenses directly attributable to the reportable segment. Segment profit (loss) excludes loss on assets held-for-sale, goodwill and intangible asset impairment charges, depreciation and amortization expense, unallocated corporate general and administrative expense, interest and other income (expense), income taxes, and other costs and benefits not considered to be ongoing.
The following tables present our revenue from services by segment, with a reconciliation to total Company revenue. The tables also present significant segment expense categories regularly provided to the chief operating decision-maker (“CODM”), our Chief Executive Officer, and included in the calculation of segment profit (loss). Cost of services and SG&A expense for the individual segments, as presented in the tables below, exclude certain costs and benefits that are also excluded from the calculation of segment profit (loss). Lastly, the tables include a reconciliation of segment profit (loss) to loss before tax expense.
Page - 19
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
| Thirteen weeks ended | ||||||||||||||
| June 28, 2026 | ||||||||||||||
| (in thousands) | PeopleReady | PeopleManagement | PeopleSolutions | Total Company | ||||||||||
Revenue from services | $ | $ | $ | $ | ||||||||||
Cost of services | ||||||||||||||
Selling, general and administrative expense | ||||||||||||||
| Segment profit | $ | $ | $ | $ | ||||||||||
Corporate unallocated expense | ( | |||||||||||||
| Amortization of software as a service assets | ( | |||||||||||||
| Acquisition/integration costs | ( | |||||||||||||
| Loss on assets held-for-sale | ( | |||||||||||||
Workforce reduction costs | ( | |||||||||||||
Other costs, net | ( | |||||||||||||
Depreciation and amortization (inclusive of depreciation included in cost of services) | ( | |||||||||||||
| Loss from operations | ( | |||||||||||||
| Interest and other income (expense), net | ( | |||||||||||||
| Loss before tax expense | $ | ( | ||||||||||||
| Thirteen weeks ended | ||||||||||||||
| June 29, 2025 | ||||||||||||||
| (in thousands) | PeopleReady | PeopleManagement | PeopleSolutions | Total Company | ||||||||||
Revenue from services | $ | $ | $ | $ | ||||||||||
Cost of services | ||||||||||||||
Selling, general and administrative expense | ||||||||||||||
| Segment profit | $ | $ | $ | $ | ||||||||||
Corporate unallocated expense | ( | |||||||||||||
| Third-party processing fees for hiring tax credits | ||||||||||||||
| Amortization of software as a service assets | ( | |||||||||||||
| Goodwill and intangible asset impairment charge | ( | |||||||||||||
Acquisition/integration costs | ( | |||||||||||||
COVID-19 government subsidies, net of fees | ||||||||||||||
Workforce reduction costs | ( | |||||||||||||
Other costs, net | ( | |||||||||||||
Depreciation and amortization (inclusive of depreciation included in cost of services) | ( | |||||||||||||
| Loss from operations | ( | |||||||||||||
| Interest and other income (expense), net | ||||||||||||||
| Loss before tax expense | $ | ( | ||||||||||||
Page - 20
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | ||
| Twenty-six weeks ended | ||||||||||||||
| June 28, 2026 | ||||||||||||||
| (in thousands) | PeopleReady | PeopleManagement | PeopleSolutions | Total Company | ||||||||||
Revenue from services | $ | $ | $ | $ | ||||||||||
Cost of services | ||||||||||||||
Selling, general and administrative expense | ||||||||||||||
| Segment profit | $ | $ | $ | $ | ||||||||||
Corporate unallocated expense | ( | |||||||||||||
| Third-party processing fees for hiring tax credits | ||||||||||||||
| Amortization of software as a service assets | ( | |||||||||||||
| Acquisition/integration costs | ( | |||||||||||||
| Loss on assets held-for-sale | ( | |||||||||||||
| Goodwill and intangible asset impairment charge | ( | |||||||||||||
Workforce reduction costs | ( | |||||||||||||
Other costs, net | ( | |||||||||||||
Depreciation and amortization (inclusive of depreciation included in cost of services) | ( | |||||||||||||
| Loss from operations | ( | |||||||||||||
| Interest and other income (expense), net | ( | |||||||||||||
| Loss before tax expense | $ | ( | ||||||||||||
| Twenty-six weeks ended | ||||||||||||||
| June 29, 2025 | ||||||||||||||
| (in thousands) | PeopleReady | PeopleManagement | PeopleSolutions | Total Company | ||||||||||
Revenue from services | $ | $ | $ | $ | ||||||||||
Cost of services | ||||||||||||||
Selling, general and administrative expense | ||||||||||||||
| Segment profit (loss) | $ | ( | $ | $ | $ | |||||||||
Corporate unallocated expense | ( | |||||||||||||
| Third-party processing fees for hiring tax credits | ( | |||||||||||||
| Amortization of software as a service assets | ( | |||||||||||||
Acquisition/integration costs | ( | |||||||||||||
| Goodwill and intangible asset impairment charge | ( | |||||||||||||
COVID-19 government subsidies, net of fees | ||||||||||||||
Workforce reduction costs | ( | |||||||||||||
Other costs, net | ( | |||||||||||||
Depreciation and amortization (inclusive of depreciation included in cost of services) | ( | |||||||||||||
| Loss from operations | ( | |||||||||||||
| Interest and other income (expense), net | ||||||||||||||
| Loss before tax expense | $ | ( | ||||||||||||
Asset information by reportable segment is not presented as we do not manage our segments on a balance sheet basis.
Page - 21
Table of Contents
| Item 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | ||||
COMMENT ON FORWARD-LOOKING STATEMENTS
Certain statements in this Form 10-Q, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements involve risks and uncertainties, and future events and circumstances could differ significantly from those anticipated in the forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “goal,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied in our forward-looking statements, including the risks and uncertainties described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (Part I, Item 2 of this Form 10-Q),“Quantitative and Qualitative Disclosures about Market Risk” (Part I, Item 3 of this Form 10-Q), and “Risk Factors” (Part II, Item 1A of this Form 10-Q). Except as required by law, we undertake no duty to update or revise publicly any of the forward-looking statements after the date of this report or to conform such statements to actual results or to changes in our expectations, whether because of new information, future events, or otherwise.
BUSINESS OVERVIEW
TrueBlue, Inc. (the “Company,” “TrueBlue,” “we,” “us” and “our”) is a leading provider of specialized workforce solutions that connect employers and talent. Client demand for contingent workforce solutions and outsourced recruiting services is cyclical and dependent on the overall strength of the economy and labor market, as well as trends in workforce flexibility.
We report our business as three distinct segments: PeopleReady, PeopleManagement and PeopleSolutions.
•PeopleReady provides clients with dependable access to qualified associates for their on-demand, contingent general and skilled labor needs to supplement their permanent workforce across a broad range of industries including construction, transportation, manufacturing, retail, hospitality and energy. PeopleReady connects our clients with individuals looking for on-demand, general temporary and temp-to-hire positions through our vast network of physical branches across all 50 states in the United States (“U.S.”) and Puerto Rico. Augmenting our branch network, our proprietary mobile app, JobStack®, connects people with on-demand work 24 hours a day, seven days a week. PeopleReady also connects skilled tradespeople with temporary work across a wide range of trades, including carpentry, electrical, plumbing, welding and energy installation positions through our PeopleReady Skilled Trades and RenewableWorks brands.
•PeopleManagement provides and manages contingent associates at our clients’ facilities through our Staff Management | SMX (“Staff Management”) and SIMOS Insourcing Solutions (“SIMOS”) brands throughout the U.S., Canada and Puerto Rico. Our client engagements include scalable recruiting, screening, hiring and management of the contingent workforce. We deploy dedicated management and service teams that work side-by-side with a client’s full-time workforce and specialize in labor-intensive manufacturing, warehousing and distribution. Our proprietary hiring and workforce management software, Stafftrack®, enables us to recruit and connect the best candidates with on-site assignments. PeopleManagement also provides dedicated and contingent commercial drivers to the transportation and distribution industries through our Centerline Drivers (“Centerline”) brand. Centerline matches drivers to each client’s specific needs, allowing them to improve productivity, control costs, ensure compliance and deliver improved service.
•PeopleSolutions provides clients with services focusing on professional and specialized talent acquisition, as well as workforce management and compliance, across a wide variety of industries, primarily in the U.S., Canada, the United Kingdom and Australia. PeopleSolutions provides recruitment process outsourcing (“RPO”), managed service provider (“MSP”) solutions and talent advisory services through our PeopleScout brand. PeopleSolutions also facilitates the placement of skilled healthcare professionals in extended roles with governmental agencies, healthcare systems and educational institutions through our Healthcare Staffing Professionals (“HSP”) brand. HSP streamlines hiring for employers while connecting job seekers with opportunities to grow and advance their careers. Assisting our PeopleSolutions recruiting teams is our proprietary technology platform, Affinix®, which rapidly sources a qualified talent pool, and further engages candidates through a seamless digital experience.
Page - 22
Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS | ||||||||
Fiscal second quarter of 2026 summary
The following results are for the thirteen weeks ended June 28, 2026, compared to the same period in the prior year:
•Total Company revenue grew 11.8% to $443.0 million, compared to $396.3 million.
•Total Company gross profit declined 2.1% to $91.6 million compared to $93.6 million, resulting in a decline in gross profit as a percentage of revenue to 20.7%, compared to 23.6%.
•Total Company selling, general and administrative (“SG&A”) expense declined 6.6% to $83.8 million, compared to $89.8 million.
•We recorded a non-cash loss on assets held-for-sale of $3.0 million related to our Tacoma headquarters.
•Income tax expense was $0.9 million, compared to $0.1 million. We continue to maintain a valuation allowance against our U.S. federal, state and certain foreign deferred tax assets initially established in the fiscal second quarter of 2024, resulting in no current period income tax benefit for these jurisdictions.
•The items above resulted in a net loss of $3.4 million, compared to a net loss of $0.2 million.
•As of June 28, 2026, we had cash and cash equivalents of $23.3 million, outstanding debt of $82.4 million, and $56.2 million was unused on our borrowing base of our revolving credit agreement (“Amended Revolving Credit Facility”), resulting in total liquidity of $79.5 million.
Page - 23
Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS | ||||||||
RESULTS OF OPERATIONS
Total Company results
The following table presents selected financial data:
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||||||||||||||
| (in thousands, except percentages and per share data) | Jun 28, 2026 | % of revenue | Jun 29, 2025 | % of revenue | Jun 28, 2026 | % of revenue | Jun 29, 2025 | % of revenue | |||||||||||||||||||||
| Revenue from services | $ | 443,001 | $ | 396,299 | $ | 841,567 | $ | 766,553 | |||||||||||||||||||||
| Gross profit | $ | 91,582 | 20.7 | % | $ | 93,564 | 23.6 | % | $ | 170,601 | 20.3 | % | $ | 179,906 | 23.5 | % | |||||||||||||
| Selling, general and administrative expense | 83,831 | 18.9 | 89,798 | 22.7 | 171,130 | 20.3 | 184,419 | 24.1 | |||||||||||||||||||||
| Depreciation and amortization (exclusive of depreciation included in cost of services) | 5,887 | 1.4 | 6,507 | 1.5 | 11,798 | 1.4 | 12,351 | 1.6 | |||||||||||||||||||||
| Loss on assets held-for-sale | 3,026 | 0.7 | — | — | 3,026 | 0.4 | — | — | |||||||||||||||||||||
| Goodwill and intangible asset impairment charge | — | — | 200 | 0.1 | 3,656 | 0.5 | 200 | 0.0 | |||||||||||||||||||||
| Loss from operations | (1,162) | (0.3) | % | (2,941) | (0.7) | % | (19,009) | (2.3) | % | (17,064) | (2.2) | % | |||||||||||||||||
Interest and other income (expense), net | (1,320) | 2,903 | (2,692) | 3,096 | |||||||||||||||||||||||||
| Loss before tax expense | (2,482) | (38) | (21,701) | (13,968) | |||||||||||||||||||||||||
| Income tax expense | 887 | 122 | 1,463 | 540 | |||||||||||||||||||||||||
| Net loss | $ | (3,369) | (0.8) | % | $ | (160) | 0.0 | % | $ | (23,164) | (2.8) | % | $ | (14,508) | (1.9) | % | |||||||||||||
Net loss per diluted share | $ | (0.11) | $ | (0.01) | $ | (0.76) | $ | (0.49) | |||||||||||||||||||||
Revenue from services
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||||||||||||||||||||
| (in thousands, except percentages) | Jun 28, 2026 | Growth (decline) % | Segment % of total | Jun 29, 2025 | Segment % of total | Jun 28, 2026 | Growth (decline) % | Segment % of total | Jun 29, 2025 | Segment % of total | |||||||||||||||||||||||||
| Revenue from services: | |||||||||||||||||||||||||||||||||||
| PeopleReady | $ | 262,310 | 23.0 | % | 59.2 | % | $ | 213,226 | 53.8 | % | $ | 487,363 | 21.1 | % | 57.9 | % | $ | 402,531 | 52.5 | % | |||||||||||||||
| PeopleManagement | 133,839 | — | % | 30.2 | 133,895 | 33.8 | 261,096 | (3.1) | % | 31.0 | 269,427 | 35.2 | |||||||||||||||||||||||
| PeopleSolutions | 46,852 | (4.7) | % | 10.6 | 49,178 | 12.4 | 93,108 | (1.6) | % | 11.1 | 94,595 | 12.3 | |||||||||||||||||||||||
| Total Company | $ | 443,001 | 11.8 | % | 100.0 | % | $ | 396,299 | 100.0 | % | $ | 841,567 | 9.8 | % | 100.0 | % | $ | 766,553 | 100.0 | % | |||||||||||||||
Total Company revenue grew 11.8% to $443.0 million for the thirteen weeks ended June 28, 2026, and grew 9.8% to $841.6 million for the twenty-six weeks ended June 28, 2026, compared to the same periods in the prior year. The increase in revenue was primarily driven by growth within our skilled businesses, specifically in the energy and commercial driving industries. Growth was partially offset by declines within on-site and permanent hiring, as business conditions continue to stabilize within these offerings. Growth for the twenty-six weeks ended June 28, 2026 was also partially offset by declines within our on-demand business; however, this business returned to growth for the thirteen weeks ended June 28, 2026.
PeopleReady
PeopleReady revenue grew 23.0% to $262.3 million for the thirteen weeks ended June 28, 2026, and grew 21.1% to $487.4 million for the twenty-six weeks ended June 28, 2026, compared to the same periods in the prior year. The increase in revenue for both periods was primarily as a result of growth within our skilled businesses, specifically the energy industry. Our on-demand business contributed to growth during the thirteen weeks ended June 28, 2026.
Page - 24
Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS | ||||||||
PeopleManagement
PeopleManagement revenue was relatively unchanged at $133.8 million for the thirteen weeks ended June 28, 2026, and declined 3.1% to $261.1 million for the twenty-six weeks ended June 28, 2026, compared to the same periods in the prior year. The decline for the twenty-six weeks ended June 28, 2026 was primarily due to lower volumes within our OnSite businesses, partially offset by continued growth in our commercial driving business.
PeopleSolutions
PeopleSolutions revenue declined 4.7% to $46.9 million for the thirteen weeks ended June 28, 2026, and declined 1.6% to $93.1 million for the twenty-six weeks ended June 28, 2026, compared to the same periods in the prior year. Revenue declined as broader market conditions continue to impact hiring trends.
Gross profit
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||
| (in thousands, except percentages) | Jun 28, 2026 | Jun 29, 2025 | Jun 28, 2026 | Jun 29, 2025 | |||||||||||||
| Gross profit | $ | 91,582 | $ | 93,564 | $ | 170,601 | $ | 179,906 | |||||||||
| Percentage of revenue | 20.7 | % | 23.6 | % | 20.3 | % | 23.5 | % | |||||||||
Gross profit as a percentage of revenue declined 290 basis points to 20.7% for the thirteen weeks ended June 28, 2026, compared to the same period in the prior year. Higher workers’ compensation costs, driven by less favorable workers’ compensation reserve adjustments, resulted in 120 basis points of contraction. Changes in revenue mix resulted in 90 basis points of contraction, primarily driven by revenue shifts toward our lower margin staffing businesses. Additionally, the thirteen weeks ended June 29, 2025 included a benefit for recognition of certain COVID-19 government subsidies, resulting in 80 basis points of contraction for the thirteen weeks ended June 28, 2026.
Gross profit as a percentage of revenue declined 320 basis points to 20.3% for the twenty-six weeks ended June 28, 2026, compared to the same period in the prior year. Higher workers’ compensation costs, driven by less favorable workers’ compensation reserve adjustments, resulted in 170 basis points of contraction. Changes in revenue mix resulted in 100 basis points of contraction, primarily driven by revenue shifts toward our lower margin staffing businesses. Additionally, the twenty-six weeks ended June 29, 2025 included a benefit for recognition of certain COVID-19 government subsidies, resulting in 50 basis points of contraction for the twenty-six weeks ended June 28, 2026.
SG&A expense
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||
| (in thousands, except percentages) | Jun 28, 2026 | Jun 29, 2025 | Jun 28, 2026 | Jun 29, 2025 | |||||||||||||
| Selling, general and administrative expense | $ | 83,831 | $ | 89,798 | $ | 171,130 | $ | 184,419 | |||||||||
| Percentage of revenue | 18.9 | % | 22.7 | % | 20.3 | % | 24.1 | % | |||||||||
Total Company SG&A expense declined by 6.6%, or $6.0 million, for the thirteen weeks ended June 28, 2026, and declined by 7.2%, or $13.3 million, for the twenty-six weeks ended June 28, 2026, compared to the same periods in the prior year. Cost management actions have enhanced the efficiency of our cost structure and position us to deliver stronger profitability as industry demand rebounds.
Depreciation and amortization
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||
| (in thousands, except percentages) | Jun 28, 2026 | Jun 29, 2025 | Jun 28, 2026 | Jun 29, 2025 | |||||||||||||
| Depreciation and amortization (exclusive of depreciation included in cost of services) | $ | 5,887 | $ | 6,507 | $ | 11,798 | $ | 12,351 | |||||||||
| Percentage of revenue | 1.4 | % | 1.5 | % | 1.4 | % | 1.6 | % | |||||||||
Depreciation and amortization decreased for the thirteen and twenty-six weeks ended June 28, 2026, compared to the same periods in the prior year, primarily due to certain assets becoming fully depreciated during 2025.
Page - 25
Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS | ||||||||
Loss on assets held-for-sale
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||
(in thousands) | Jun 28, 2026 | Jun 29, 2025 | Jun 28, 2026 | Jun 29, 2025 | |||||||||||||
| Loss on assets held-for-sale | $ | 3,026 | $ | — | $ | 3,026 | $ | — | |||||||||
Our Tacoma headquarters office building and related assets (the “disposal group”), with an initial carrying value of $11.8 million, have been classified as held-for-sale since all criteria were met, and continue to be as of June 28, 2026. While we remain under contract with the prospective buyer, the delay is due to circumstances beyond our control, and we continue to actively market and pursue alternative options for completion of a sale within a reasonable timeframe.
During the thirteen weeks ended June 28, 2026, we updated our estimate of fair value less costs to sell to $8.7 million based on recent comparable market transactions, resulting in a non-cash loss on assets held-for-sale of $3.0 million during the thirteen weeks and twenty-six weeks ended June 28, 2026, which is included in loss on assets held-for-sale on our Consolidated Statements of Operations and Comprehensive Income (Loss).
Goodwill and intangible asset impairment charge
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||
(in thousands) | Jun 28, 2026 | Jun 29, 2025 | Jun 28, 2026 | Jun 29, 2025 | |||||||||||||
| Goodwill and intangible asset impairment charge | $ | — | $ | 200 | $ | 3,656 | $ | 200 | |||||||||
We performed an interim impairment test as of the last day of our fiscal first quarter of 2026. As a result of this impairment test, we concluded that the carrying amount of the HSP reporting unit exceeded its estimated fair value. Thus, we recorded a non-cash goodwill impairment charge of $3.7 million, for the twenty-six weeks ended June 28, 2026. The goodwill impairment was primarily driven by downward revisions to future projections associated with our HSP reporting unit, an increase in the weighted average cost of capital selected, and a decline in the market capitalization of similar publicly traded companies. The remaining goodwill balance for HSP as of June 28, 2026 was $13.7 million. See Note 6: Goodwill and Intangible Assets to our consolidated financial statements found in Item 1 of this Quarterly Report on Form 10-Q, for additional details.
Income tax expense
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||
| (in thousands, except percentages) | Jun 28, 2026 | Jun 29, 2025 | Jun 28, 2026 | Jun 29, 2025 | |||||||||||||
| Loss before tax expense | $ | (2,482) | $ | (38) | $ | (21,701) | $ | (13,968) | |||||||||
| Income tax expense | $ | 887 | $ | 122 | $ | 1,463 | $ | 540 | |||||||||
| Effective income tax rate | (35.7) | % | (321.1) | % | (6.7) | % | (3.9) | % | |||||||||
Our tax provision and our effective tax rate are subject to variation due to several factors, including variability in accurately predicting our full year pre-tax income or loss by jurisdiction, tax credits, government audit developments, changes in laws, regulations and administrative practices, valuation allowances recorded on deferred tax assets, and relative changes in expenses or losses for which tax benefits are not recognized. Additionally, our effective tax rate can be more or less volatile based on the amount of pre-tax income or loss. For example, the impact of discrete items, tax credits, and non-deductible expenses on our effective tax rate is greater when our pre-tax income or loss is lower.
For the twenty-six weeks ended June 28, 2026, our income tax expense is related primarily to our foreign operations. We continue to maintain a valuation allowance against our U.S. federal, state and certain foreign deferred tax assets, initially established in the fiscal second quarter of 2024, resulting in no income tax benefit for these jurisdictions. Our conclusions to maintain a valuation allowance were driven by U.S. and foreign pre-tax losses beginning in 2023 and continuing into 2026, combined with the significant non-cash goodwill impairment charge of $59.1 million recorded during fiscal 2024.
Page - 26
Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS | ||||||||
Segment performance
We evaluate performance based on segment revenue and segment profit (loss). Segment revenue is net of intercompany eliminations. Segment profit (loss) includes revenue, related cost of services, and ongoing operating expenses directly attributable to the reportable segment. Segment profit (loss) excludes loss on assets held-for-sale, goodwill and intangible asset impairment charges, depreciation and amortization expense, unallocated corporate general and administrative expense, interest and other income (expense), income taxes, and other costs and benefits not considered to be ongoing. See Note 13: Segment Information, to our consolidated financial statements found in Item 1 of this Quarterly Report on Form 10-Q, for additional details on our reportable segments, as well as a reconciliation of segment profit (loss) to loss before tax expense.
Segment profit (loss) should not be considered a measure of financial performance in isolation or as an alternative to net loss on the Consolidated Statements of Operations and Comprehensive Income (Loss) calculated in accordance with accounting principles generally accepted in the United States of America, and may not be comparable to similarly titled measures of other companies.
PeopleReady segment performance was as follows:
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||||||||||||||
| (in thousands, except percentages) | Jun 28, 2026 | % of revenue | Jun 29, 2025 | % of revenue | Jun 28, 2026 | % of revenue | Jun 29, 2025 | % of revenue | |||||||||||||||||||||
| Revenue from services | $ | 262,310 | $ | 213,226 | $ | 487,363 | $ | 402,531 | |||||||||||||||||||||
Cost of services | 206,504 | 78.7 | % | 158,267 | 74.2 | % | 384,584 | 78.9 | % | 294,790 | 73.2 | % | |||||||||||||||||
| Selling, general and administrative expense | 47,245 | 18.0 | % | 53,429 | 25.1 | % | 97,520 | 20.0 | % | 109,185 | 27.1 | % | |||||||||||||||||
| Segment profit (loss) | $ | 8,561 | 3.3 | % | $ | 1,530 | 0.7 | % | $ | 5,259 | 1.1 | % | $ | (1,444) | (0.3) | % | |||||||||||||
PeopleReady segment profit grew $7.0 million and $6.7 million for the thirteen and twenty-six weeks ended June 28, 2026, and also improved as a percentage of revenue, compared to the same periods in the prior year, respectively. Growth was primarily due to continued revenue growth within our skilled businesses, specifically the energy industry. Cost management actions have also resulted in a more efficient cost structure and improved our operating leverage as revenue increased. The improvement was partially offset by higher workers’ compensation costs driven by less favorable workers’ compensation reserve adjustments.
PeopleManagement segment performance was as follows:
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||||||||||||||
| (in thousands, except percentages) | Jun 28, 2026 | % of revenue | Jun 29, 2025 | % of revenue | Jun 28, 2026 | % of revenue | Jun 29, 2025 | % of revenue | |||||||||||||||||||||
| Revenue from services | $ | 133,839 | $ | 133,895 | $ | 261,096 | $ | 269,427 | |||||||||||||||||||||
Cost of services | 113,456 | 84.8 | % | 113,065 | 84.4 | % | 221,960 | 85.0 | % | 228,368 | 84.8 | % | |||||||||||||||||
Selling, general and administrative expense | 15,425 | 11.5 | % | 16,729 | 12.5 | % | 30,924 | 11.9 | % | 34,064 | 12.6 | % | |||||||||||||||||
Segment profit | $ | 4,958 | 3.7 | % | $ | 4,101 | 3.1 | % | $ | 8,212 | 3.1 | % | $ | 6,995 | 2.6 | % | |||||||||||||
PeopleManagement segment profit grew $0.9 million and $1.2 million for the thirteen and twenty-six weeks ended June 28, 2026, and also improved as a percentage of revenue, compared to the same periods in the prior year, respectively. Growth was primarily driven by a reduction in SG&A expense, which was the result of disciplined cost management actions to streamline our organizational structure and improve efficiency.
Page - 27
Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS | ||||||||
PeopleSolutions segment performance was as follows:
Thirteen weeks ended | Twenty-six weeks ended | ||||||||||||||||||||||||||||
| (in thousands, except percentages) | Jun 28, 2026 | % of revenue | Jun 29, 2025 | % of revenue | Jun 28, 2026 | % of revenue | Jun 29, 2025 | % of revenue | |||||||||||||||||||||
| Revenue from services | $ | 46,852 | $ | 49,178 | $ | 93,108 | $ | 94,595 | |||||||||||||||||||||
| Cost of services | 30,495 | 65.1 | % | 33,469 | 68.0 | % | 62,450 | 67.1 | % | 64,486 | 68.2 | % | |||||||||||||||||
| Selling, general and administrative expense | 11,529 | 24.6 | % | 13,175 | 26.8 | % | 23,167 | 24.9 | % | 25,623 | 27.1 | % | |||||||||||||||||
| Segment profit | $ | 4,828 | 10.3 | % | $ | 2,534 | 5.2 | % | $ | 7,491 | 8.0 | % | $ | 4,486 | 4.7 | % | |||||||||||||
PeopleSolutions segment profit grew $2.3 million and $3.0 million for the thirteen and twenty-six weeks ended June 28, 2026, and also grew as a percentage of revenue, compared to the same periods in the prior year, respectively. Growth was primarily driven by cost management actions to deliver efficiency and improve profitability.
Page - 28
Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS | ||||||||
LIQUIDITY AND CAPITAL RESOURCES
We believe we have a strong financial position and sufficient sources of funding to meet our short- and long-term obligations. Our Amended Revolving Credit Facility provides for a revolving line of credit of up to $175.0 million, with an option to increase the amount by $150.0 million, subject to lender approval. As of June 28, 2026, we had $23.3 million in cash and cash equivalents and $82.4 million debt outstanding. Under the Amended Revolving Credit Facility, $11.3 million was utilized by outstanding standby letters of credit. As of June 28, 2026, our borrowing base was $150.0 million, leaving $56.2 million unused on our borrowing base.
Cash generated through our core operations is generally our primary source of liquidity. Our principal ongoing cash needs are to finance working capital, fund capital expenditures, repay outstanding Amended Revolving Credit Facility balances, and execute share repurchases. We may also need cash to fund future acquisitions. We manage working capital through timely collection of accounts receivable, which we achieve through focused collection efforts and tightly monitoring trends in days sales outstanding. While client payment terms are generally 90 days or less, we pay our associates daily and weekly, so additional financing through the use of our Amended Revolving Credit Facility is sometimes necessary to support working capital needs in times of revenue growth. We also manage working capital through efficient cost management and strategically timing payments of accounts payable.
We continue to make investments in online and mobile apps to increase the competitive differentiation of our services long-term and improve the efficiency of our service delivery model. In addition, we continue to transition our technology from on-premise software platforms to cloud-based software solutions, to increase automation and the efficiency of running our business.
Outside of ongoing cash needed to support core operations, our insurance carriers and certain state workers’ compensation programs require us to collateralize a portion of our workers’ compensation obligation, for which they become responsible should we become insolvent. On a regular basis, these entities assess the amount of collateral they will require from us relative to our workers’ compensation obligation. Such amounts can increase or decrease independent of our assessments and reserves. We continue to have risk that these collateral requirements may be increased by our insurers due to our loss history and market dynamics. We generally anticipate that our collateral commitments will grow as our business grows. We pay our premiums and deposit our collateral, if required, in installments. The collateral typically takes the form of cash and cash-backed instruments, highly rated investment grade securities, letters of credit, and surety bonds. Restricted cash, cash equivalents and investments supporting our self-insured workers’ compensation obligation are held in a trust at the Bank of New York Mellon (“Trust”) and are used to pay workers’ compensation claims as they are filed. See Note 7: Workers' Compensation Insurance and Reserves, and Note 4: Restricted Cash, Cash Equivalents and Investments, to our consolidated financial statements found in Item 1 of this Quarterly Report on Form 10-Q, for details on our workers’ compensation program as well as the restricted cash, cash equivalents and investments held in Trust.
We have established investment policy directives for the Trust with the first priority to preserve capital, second to ensure sufficient liquidity to pay workers’ compensation claims, third to diversify the investment portfolio and fourth to maximize after-tax returns. Trust investments must meet minimum acceptable quality standards. The primary investments include U.S. Treasury securities, U.S. agency debentures, U.S. agency mortgages, corporate securities and municipal securities. For those investments rated by nationally recognized statistical rating organizations the minimum ratings at time of purchase are:
| S&P | Moody’s | Fitch | |||||||||
| Short-term rating | A-1/SP-1 | P-1/MIG-1 | F-1 | ||||||||
| Long-term rating | A | A2 | A | ||||||||
Total collateral commitments decreased $20.4 million during the twenty-six-week period ended June 28, 2026, primarily due to the use of collateral to satisfy workers’ compensation claims, as well as a decrease in collateral levels required by our insurance carriers, consistent with the $10.8 million decrease in workers’ compensation claims reserve. See Note 9: Commitments and Contingencies, to our consolidated financial statements found in Item 1 of this Quarterly Report on Form 10-Q, for additional details on our workers’ compensation commitments. We continue to actively manage workers’ compensation cost by focusing on improving our associate safety programs and actively control costs with our network of service providers. These actions have had a positive impact creating favorable adjustments to workers’ compensation liabilities recorded in prior periods. Continued favorable adjustments to our prior year workers’ compensation liabilities are dependent on our ability to continue to aggressively lower accident rates and costs of our claims. Due to our progress in worker safety improvements and the resulting reduction in the frequency and severity of accident rates, we expect diminishing favorable adjustments to our workers' compensation liabilities going forward.
Page - 29
Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS | ||||||||
The following table provides an analysis of changes in our workers’ compensation claims reserves:
| (in thousands) | Jun 28, 2026 | Dec 28, 2025 | ||||||
Beginning balance | $ | 96,744 | $ | 139,792 | ||||
Self-insurance reserve expenses related to current year, net | 18,703 | 34,917 | ||||||
Cash payments related to current year claims | (2,538) | (12,557) | ||||||
Cash payments related to claims from prior years | (21,935) | (32,727) | ||||||
Changes to prior years’ self-insurance reserve, net | (1,435) | (19,574) | ||||||
Amortization of prior years’ discount (1) | 1,945 | (123) | ||||||
Net change in excess claims reserve (2) | (5,511) | (12,984) | ||||||
Ending balance | 85,973 | 96,744 | ||||||
Less current portion | 23,114 | 24,193 | ||||||
Long-term portion | $ | 62,859 | $ | 72,551 | ||||
(1)The discount is amortized over the estimated weighted average life. In addition, any changes to the estimated weighted average lives and corresponding discount rates for actual payments made are reflected in cost of services on the Consolidated Statement of Operations and Comprehensive Income (Loss) in the period when the changes in estimates are made.
(2)Changes to our claims above our self-insured limits (“excess claims”) are discounted to an estimated net present value using the risk-free rates associated with the actuarially determined weighted average lives of our excess claims.
Restricted cash, cash equivalents and investments also includes collateral to support our non-qualified deferred compensation plan in the form of company-owned life insurance policies. Our non-qualified deferred compensation plan is managed by a third-party service provider, and the investments backing the company-owned life insurance policies align with the amount and timing of payments based on employee elections.
A summary of our cash flows for each period are as follows:
Twenty-six weeks ended | ||||||||
| (in thousands) | Jun 28, 2026 | Jun 29, 2025 | ||||||
Net cash used in operating activities | $ | (30,357) | $ | (33,909) | ||||
Net cash provided by (used in) investing activities | 10,084 | (19,791) | ||||||
Net cash provided by financing activities | 15,676 | 45,118 | ||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents | (443) | (70) | ||||||
Net change in cash, cash equivalents and restricted cash and cash equivalents | $ | (5,040) | $ | (8,652) | ||||
Cash flows from operating activities
Operating cash flows consist of net loss adjusted for non-cash benefits and expenses, and changes in operating assets and liabilities.
As client demand improves, the result is generally an increase in accounts receivable and accounts payable. Accrued wages and benefits can fluctuate based on whether the period end requires the accrual of one or two weeks of payroll, the amount and timing of bonus payments, and timing of payroll tax payments.
Net cash used by accounts receivable during the twenty-six weeks ended June 28, 2026 was primarily due to an increase in revenue coupled with an increase in days sales outstanding of approximately two days compared to the fiscal fourth quarter of 2025, both reflecting shifts in revenue and corresponding receivables mix toward clients with longer payment terms. In addition, our workers’ compensation claims reserve for estimated claims decreased over the period, driven by prior-year claim payments.
Page - 30
Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS | ||||||||
Cash flows from investing activities
Investing cash flows consist of capital expenditures, business acquisitions, and purchases, sales, and maturities of restricted investments, which are managed in line with our workers’ compensation collateral funding requirements and timing of claim payments.
Net cash provided by investing activities during the twenty-six weeks ended June 28, 2026 was primarily due to maturities of restricted investments, which were only partially reinvested due to lower workers’ compensation collateral requirements. Cash provided was partially offset by capital expenditures including continued investments to upgrade our PeopleReady on-demand technology platform.
Cash flows from financing activities
Financing cash flows consist primarily of repurchases of common stock as part of our publicly announced share repurchase program, amounts to satisfy employee tax withholding obligations upon the vesting of restricted stock, the net change in our Amended Revolving Credit Facility, and proceeds from the sale of common stock through our employee stock purchase plan.
Net cash provided by financing activities during the twenty-six weeks ended June 28, 2026 was due to draws on our Amended Revolving Credit Facility, primarily to finance working capital needs as revenue increased. While we did not execute share repurchases during the twenty-six weeks ended June 28, 2026, $33.5 million remains available for repurchase under existing authorizations as of June 28, 2026.
Page - 31
Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS | ||||||||
SUMMARY OF CRITICAL ACCOUNTING ESTIMATES
Our critical accounting estimates are discussed in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations; Summary of Critical Accounting Estimates” in our Annual Report on Form 10-K for the fiscal year ended December 28, 2025. The following has been updated to reflect changes made during the twenty-six weeks ended June 28, 2026.
Goodwill and indefinite-lived intangible assets
We evaluate goodwill and indefinite-lived intangible assets for impairment on an annual basis as of the first day of our fiscal second quarter, or whenever events or circumstances make it more likely than not that an impairment may have occurred. These events or circumstances could include a significant change in general economic conditions, deterioration in industry environment, changes in cost factors, declining operating performance indicators, legal factors, competition, client engagement, changes in the carrying amount of net assets, a sale or disposition of a significant portion of a reporting unit, or a sustained decrease in stock price. We monitor the existence of potential impairment indicators throughout the fiscal year.
Goodwill
We test for goodwill impairment at the reporting unit level. We consider our reporting units to be our operating segments or one level below that (the component level) based on our organizational structure. Our reporting units with remaining goodwill as of June 28, 2026 were Centerline, PeopleScout, and HSP.
When evaluating goodwill for impairment, we may first assess qualitative factors to determine whether it is more likely than not the fair value of a reporting unit is less than its carrying amount. Qualitative factors include macroeconomic conditions, industry and market conditions and overall Company financial performance. If, after assessing the totality of events and circumstances, we determine that it is more likely than not the fair value of the reporting unit is greater than its carrying amount, the quantitative impairment test is unnecessary.
The quantitative impairment test, if necessary, involves comparing the fair value of each reporting unit to its carrying value, including goodwill. Fair value reflects the price a market participant would be willing to pay in a potential sale of the reporting unit. If the fair value exceeds the carrying value, we conclude that no goodwill impairment has occurred. If the carrying value exceeds the fair value, we recognize an impairment charge in an amount equal to the excess, not to exceed the carrying value of the goodwill. We consider a reporting unit’s fair value to be substantially in excess of its carrying value at a 20% premium or greater.
Determining the fair value of a reporting unit when performing a quantitative impairment test involves the use of significant estimates and assumptions to evaluate the impact of operational and economic changes on each reporting unit. We estimate the fair value using a weighting of the income and market valuation approaches. The income approach applies a fair value methodology to each reporting unit based on discounted cash flows. This analysis requires significant estimates and judgments, including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for our business, estimation of the useful life over which cash flows will occur, and determination of our weighted average cost of capital, which is risk-adjusted to reflect the specific risk profile of the reporting unit being tested. We also apply a market approach, which develops a value correlation based on the market capitalization of similar publicly traded companies, referred to as a multiple, to apply to the operating results of the reporting units. The primary market multiples to which we compare are revenue and earnings before interest, taxes, depreciation, and amortization.
We base fair value estimates on assumptions we believe to be reasonable but that are unpredictable and inherently uncertain. Actual future results may differ from those estimates.
Page - 32
Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS | ||||||||
Interim impairment test
During the fiscal first quarter of 2026, the sustained decrease in share price and resulting decrease in market capitalization, as well as downward revisions to future revenue and profitability projections related to the HSP reporting unit due to reductions in government funding that has impacted certain HSP clients, resulted in management determining that a triggering event occurred for the HSP reporting unit. Therefore, we performed an interim goodwill impairment test for this reporting unit as of the last day of our fiscal first quarter of 2026. The weighted average cost of capital used in our most recent impairment test was 16.5%, which was risk-adjusted to reflect the specific risk profile of the HSP reporting unit.
Based on our interim impairment test as of the last day of our fiscal first quarter of 2026, we concluded that the carrying amount of the HSP reporting unit exceeded its estimated fair value. Thus, we recorded a non-cash goodwill impairment charge of $3.7 million, which was included in goodwill and intangible asset impairment charge on our Consolidated Statements of Operations and Comprehensive Income (Loss) for the twenty-six weeks ended June 28, 2026. The goodwill impairment was primarily driven by downward revisions to future projections associated with our HSP reporting unit, an increase in the weighted average cost of capital selected, and a decline in market capitalization of similar publicly traded companies. The remaining goodwill balance for HSP as of June 28, 2026 was $13.7 million. Any significant adverse change in our near- or long-term projections or macroeconomic conditions could result in future impairment charges. We will continue to closely monitor the operational performance of this reporting unit.
Annual impairment test
We performed our annual impairment test for goodwill as of the first day of the fiscal second quarter of 2026 for all reporting units with remaining goodwill, including HSP. Based on our assessment of qualitative factors, we concluded it was more likely than not that the fair value of each reporting unit exceeded its carrying value, and the goodwill associated with each reporting unit was not impaired. As such, it was not necessary to perform a quantitative impairment analysis.
Indefinite-lived intangible assets
We have indefinite-lived intangible assets for trademarks related to businesses within our PeopleManagement and PeopleSolutions segments. We evaluate our indefinite-lived intangible assets for impairment on an annual basis as of the first day of our fiscal second quarter, or whenever events or circumstances make it more likely than not that an impairment may have occurred. These events or circumstances could include significant changes in general economic conditions, deterioration in industry environment, changes in cost factors, declining operating performance indicators, legal factors, competition, client engagement, or a sale or disposition of a significant portion of the business. We monitor the existence of potential impairment indicators throughout the fiscal year.
When evaluating indefinite-lived intangible assets for impairment, we may first assess qualitative factors to determine whether it is more likely than not the fair value of the indefinite-lived intangible asset is less than its carrying amount. Qualitative factors include macroeconomic conditions, industry and market conditions and overall Company financial performance. If, after assessing the totality of events and circumstances, we determine that it is more likely than not the fair value of the indefinite-lived intangible asset is greater than its carrying amount, the quantitative impairment test is unnecessary.
The quantitative impairment test, if necessary, utilizes the relief from royalty method to determine the fair value of each of our trademarks. If the carrying value exceeds the fair value, we recognize an impairment loss in an amount equal to the excess, not to exceed the carrying value. Management uses considerable judgment to determine key assumptions, including forecasted future revenue, royalty rates and appropriate discount rates. We performed our annual impairment test for indefinite-lived intangible assets as of the first day of our fiscal second quarter of 2026. Based on our quantitative assessment, we concluded that the fair value of each trademark was in excess of its carrying amount as of June 28, 2026, and therefore did not result in an impairment.
NEW ACCOUNTING STANDARDS
See Note 1: Summary of Significant Accounting Policies, to our consolidated financial statements found in Item 1 of this Quarterly Report on Form 10-Q.
Item 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK | ||||
Our quantitative and qualitative disclosures about market risk are discussed in Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” in our Annual Report on Form 10-K for the fiscal year ended December 28, 2025, and have not changed materially.
Page - 33
Table of Contents
Item 4. | CONTROLS AND PROCEDURES | ||||
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our periodic reports filed or submitted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Our disclosure controls and procedures are also designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
During the fiscal second quarter of 2026, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures at a reasonable assurance level, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level, as of June 28, 2026.
There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during our most recently completed fiscal quarter that materially affected or are reasonably likely to materially affect our internal control over financial reporting.
The certifications required by Rule 13a-14 of the Exchange Act are filed as exhibits 31.1 and 31.2, respectively, to this Quarterly Report on Form 10-Q.
Page - 34
Table of Contents
PART II. OTHER INFORMATION
Item 1. | LEGAL PROCEEDINGS | ||||
See Note 9: Commitments and Contingencies, to our consolidated financial statements found in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Item 1A. | RISK FACTORS | ||||
This Quarterly Report on Form 10-Q should be read in conjunction with the risk factors set forth in Part I, Item 1A of our Annual Report filed on Form 10-K for the year ended December 28, 2025. With the exception of the risk factors noted below, which update the specific risk factors in our Annual Report filed on Form 10-K for the year ended December 28, 2025, there have been no material changes from the risk factors previously disclosed therein.
Investing in our securities involves risk. In addition to the updated risk factors below and all other information set forth in this Quarterly Report on Form 10-Q, the risk factors described in Part I, Item 1A of our Annual Report filed on Form 10-K for the year ended December 28, 2025 should be considered in evaluating our future prospects. If any of the events described herein or therein occur, our business, financial condition, results of operations, liquidity, or access to the capital markets could be materially and adversely affected.
Some provisions of our articles of incorporation, our bylaws and Washington law include terms and conditions that could discourage a takeover or other transactions that shareholders may consider favorable.
Our articles of incorporation and bylaws contain provisions that may have the effect of making it more difficult for a third party to acquire or attempt to acquire control of the Company, including:
•no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;
•the right of our Board of Directors (the “Board”) to elect a director to fill a vacancy created by the expansion of the Board or the resignation, death, or removal of a director in certain circumstances;
•the right of our Board to establish the number of directors serving on our Board at any given time; and
•advance notice procedures that shareholders must comply with in order to nominate candidates to our Board or to propose matters to be acted upon at a shareholders’ meeting, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of the Company.
In the past, in response to unsolicited offers to the Company, the Board has adopted a Shareholder Rights Plan, and may do so again if faced with similar circumstances inconsistent with the best interests of our shareholders. In addition, because we are incorporated in the State of Washington, we are governed by the provisions of Chapter 23B.19 of the Washington Business Corporation Act, which prohibits certain business combinations between us and certain significant shareholders unless specified conditions are met. These provisions in our articles of incorporation, our bylaws and Washington law may also have the effect of delaying or preventing a change of control of the Company, even if this change of control would benefit our shareholders.
Unsolicited acquisition proposals and attempts to acquire control of the Company could cause us to incur significant expense, disrupt our business, result in a proxy contest or litigation and impact our stock price.
We have been, and may continue to be, subject to unsolicited acquisition proposals, tender offers, or proxy contests to gain control of the Company, which could result in substantial costs to the Company and divert management’s and our Board’s attention and resources from our business. Such events could give rise to perceived uncertainties as to our future, adversely affect our relationships with our employees, clients or suppliers, and make it more difficult to attract and retain qualified personnel. We have been, and may continue to be, required to incur significant fees and other expenses in responding to these events, including for required regulatory responses and third-party advisors. We also may be subjected to shareholder litigation in connection with these events. Our stock price could be subject to significant fluctuations or otherwise be adversely affected by speculative market perceptions about these events, risks and uncertainties.
Page - 35
Table of Contents
For example, we have received unsolicited proposals to buy all or a portion of the Company. After a careful review of these proposals, including consultation with the Company’s independent financial and legal advisors regarding the Company’s business strategy, historic, current and future valuation, and potential alternative opportunities, they have been unanimously rejected by our Board, as they failed to maximize value for, and were not in the best interests of, the Company’s shareholders.
Actions of activist shareholders could cause us to incur substantial costs, divert management’s attention and resources, disrupt our business and impact the trading value of our securities.
We value constructive input from investors and regularly engage in dialogue with our shareholders regarding strategy and performance. Activist shareholders or others who disagree with the composition of the Board, our strategy or the way the Company is managed have sought and may again seek to effect change through various strategies and channels, such as through commencing a proxy contest, making public statements critical of our performance or business, or engaging in other similar activities.
Responding to shareholder activism can be costly and time-consuming, be disruptive of our operations, and divert the attention of management and our employees from strategic initiatives. Activist campaigns can create perceived uncertainties as to our future direction, strategy, or leadership and may result in the loss of potential business opportunities, harm our ability to attract and retain employees, investors, and clients, and cause our stock price to experience periods of volatility or stagnation. The process of defending against such activities can divert management’s focus from operating our business and implementing our strategic initiatives, and can adversely affect our business, financial condition, and results of operations.
Item 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS | ||||
The table below includes repurchases of our common stock pursuant to publicly announced plans or programs and those not made pursuant to publicly announced plans or programs during the thirteen weeks ended June 28, 2026.
| Period | Total number of shares purchased | Weighted average price paid per share | Total number of shares purchased as part of publicly announced plans or programs | Approximate dollar value that may yet be purchased under plans or programs at period end (1) | ||||||||||
| 03/30/2026 through 04/26/2026 | — | $— | — | $33.5 million | ||||||||||
| 04/27/2026 through 05/24/2026 | — | $— | — | $33.5 million | ||||||||||
| 05/25/2026 through 06/28/2026 | 147 | $6.76 | — | $33.5 million | ||||||||||
| Total | 147 | $6.76 | — | |||||||||||
(1)On January 31, 2022, our Board of Directors authorized a $100.0 million addition to our share repurchase program of our outstanding common stock. The share repurchase program does not obligate us to acquire any particular amount of common stock and does not have an expiration date. As of June 28, 2026, $33.5 million remains available for repurchase under the existing authorization.
Item 3. | DEFAULTS UPON SENIOR SECURITIES | ||||
Not applicable.
Item 4. | MINE SAFETY DISCLOSURES | ||||
Not applicable.
Item 5. | OTHER INFORMATION | ||||
Trading plans
During the fiscal second quarter of 2026, none of our directors or executive officers adopted terminated
Page - 36
Table of Contents
Item 6. | INDEX TO EXHIBITS | ||||
| Incorporated by reference | |||||||||||||||||
| Exhibit number | Exhibit description | Filed herewith | Form | File no. | Date of first filing | ||||||||||||
| 3.1 | Amended and Restated Articles of Incorporation. | 8-K | 001-14543 | 05/12/2016 | |||||||||||||
| 3.2 | Amended and Restated Bylaws. | 10-Q | 001-14543 | 10/30/2017 | |||||||||||||
| 3.3 | Articles of Amendment for the Series A Junior Participating Preferred Stock, as filed with the Secretary of State of Washington on May 14, 2025 (incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form 8-A, filed with the Securities and Exchange Commission on May 14, 2025, File No. 001-14543). | 8-K | 001-14543 | 05/14/2025 | |||||||||||||
| 10.1 | First Amendment to Rights Agreement, dated as of May 6, 2026, by and between the Company and Computershare Trust Company, N.A., as rights agent. | 8-K | 001-14543 | 05/06/2026 | |||||||||||||
| 10.2* | 2016 Omnibus Incentive Plan, as amended and restated, effective May 11, 2026. | X | |||||||||||||||
| 31.1 | Certification of Taryn R. Owen, Chief Executive Officer of TrueBlue, Inc., Pursuant to Rule 13a-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | X | |||||||||||||||
| 31.2 | Certification of Carl R. Schweihs, Chief Financial Officer of TrueBlue, Inc., Pursuant to Rule 13a-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | X | |||||||||||||||
| 32.1 | Certification of Taryn R. Owen, Chief Executive Officer of TrueBlue, Inc. and Carl R. Schweihs, Chief Financial Officer of TrueBlue, Inc., Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | X | |||||||||||||||
| 101 | The following financial statements from the Company’s 10-Q, formatted as Inline XBRL: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations and Comprehensive Income (Loss), (iii) Consolidated Statements of Cash Flows, and (iv) Notes to consolidated financial statements. | X | |||||||||||||||
| 104 | Cover page interactive data file - The cover page from this Quarterly Report on Form 10-Q is formatted as Inline XBRL | X | |||||||||||||||
| * | Indicates a management contract or compensatory plan or arrangement | ||||
Copies of Exhibits may be obtained upon request directed to Mr. Garrett Ferencz, TrueBlue, Inc., PO Box 2910, Tacoma, Washington, 98401 and many are available at the SEC’s website found at www.sec.gov.
Page - 37
Table of Contents
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| TrueBlue, Inc. | ||||||||||||||
/s/ Taryn R. Owen | 8/4/2026 | |||||||||||||
| Signature | Date | |||||||||||||
| By: | Taryn R. Owen, Chief Executive Officer and President | |||||||||||||
/s/ Carl R. Schweihs | 8/4/2026 | |||||||||||||
| Signature | Date | |||||||||||||
| By: | Carl R. Schweihs, Chief Financial Officer and Executive Vice President | |||||||||||||
/s/ Brian Capone | 8/4/2026 | |||||||||||||
| Signature | Date | |||||||||||||
| By: | Brian Capone, Chief Accounting Officer, Senior Vice President | |||||||||||||
Page - 38