Kforce Inc. (NYSE: KFRC) reported fourth-quarter 2025 revenue of $332.0 million for the three months ended December 31, 2025, compared with $343.8 million in the same period a year earlier and $332.6 million in the prior quarter. The company said revenue declined 0.2% sequentially, while rising 3.0% on a billing-day basis, and fell 3.4% year over year. Billing days totaled 62 in the quarter, the same as a year earlier but two fewer than in the third quarter of 2025. Net income for the quarter was $5.2 million, down from $11.1 million in the prior-year period, with diluted earnings per share of $0.30 compared with $0.60 a year earlier.
Business Segments
Technology Flex revenue was $303.6 million, down 0.2% sequentially and 3.3% from the year-ago period. Finance and Accounting (FA) Flex revenue was $22.5 million, up 2.4% sequentially but down 2.4% year over year. Direct hire revenue totaled $5.9 million, compared with $6.7 million in the fourth quarter of 2024. Total Flex hours billed were 3.81 million, versus 3.94 million a year earlier.
Profitability
Gross profit margin for the quarter was 27.2%, down 50 basis points from the prior quarter but up 20 basis points from a year earlier. Flex gross margin was 25.8%, down 50 basis points sequentially and up 30 basis points year over year. Selling, general and administrative (SG&A) expenses were 24.2% of revenue, up 140 basis points sequentially and 220 basis points from the prior-year period. Operating margin was 2.6%, down 190 basis points both sequentially and year over year.
Adjusted Results
On an adjusted basis, SG&A was 23.2% of revenue and operating margin was 3.6%. Adjusted diluted earnings per share were $0.43, compared with $0.60 a year earlier and $0.63 in the prior quarter. The company said adjustments included $1.2 million of costs related to organizational realignment activities and $2.2 million of expenses tied to streamlining operations, including a software write-off. Adjusted EBITDA for the quarter was $16.7 million, versus $20.6 million in the year-ago quarter.
Full Year 2025
For the full year, revenue totaled $1.33 billion, down 5.4% from 2024. Net income was $34.8 million, compared with $50.4 million a year earlier, with diluted earnings per share of $1.96 versus $2.68 in 2024. Operating margin was 3.8%, down 120 basis points from the prior year. Adjusted EBITDA for 2025 was $72.8 million, compared with $89.7 million in 2024.
Capital Returns
The company returned $76.0 million to shareholders during 2025 through $48.5 million in share repurchases and $27.5 million in dividends, which it said represented more than 100% of operating cash flow. The board approved a higher quarterly dividend of $0.40 per share, payable on March 20, 2026, to shareholders of record as of March 6, 2026.
First Quarter 2026 Guidance
For the first quarter of 2026, Kforce expects revenue of $324 million to $332 million, earnings per share of $0.37 to $0.45, gross margin of 26.9% to 27.1%, Flex gross margin of 25.5% to 25.7%, SG&A of 23.3% to 23.5% of revenue, and operating margin of 3.0% to 3.4%. The company estimates 63 billing days in the quarter, with weighted average shares outstanding of 17.3 million and an effective tax rate of 29.0%.
