Resources Connection, Inc. (RGP) Q1 2026 Earnings Call Transcript
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 08 2025
0mins
Should l Buy RGP?
Source: SeekingAlpha
Revenue Revenue of $120.2 million, a decline in On-Demand segment revenue by 16% year-over-year to $44.4 million, Consulting segment revenue declined by 22% year-over-year to $43.6 million, Europe and Asia Pac segment revenue grew by 5% year-over-year to $19.9 million, and Outsourced Services segment revenue grew by 4% year-over-year to $10 million. Reasons for changes include a choppy operating environment in the U.S., stabilization in On-Demand, improved bill rates, and strong client relationships in Europe and Asia Pac.
Gross Margin Gross margin of 39.5%, which is 300 basis points higher than the prior year quarter. Reasons for the increase include improvement in average bill rate, reduction in employee benefit costs, and strategic management of bench consultants' utilization.
SG&A Expense SG&A expense of $44.5 million, a 7% improvement from $47.7 million a year ago. Reasons for the decrease include lower management compensation expense and reductions in other G&A spend such as travel and occupancy.
Adjusted EBITDA Adjusted EBITDA of $3.1 million or a 2.5% adjusted EBITDA margin, with improvements driven by cost reduction efforts and better gross margin performance.
Average Bill Rate Enterprise-wide average bill rate increased to $120 constant currency from $118 a year ago, with an 11% improvement in consulting bill rates from $144 to $160. Reasons include execution of pricing strategy and delivering higher-value engagements.
Segment Adjusted EBITDA On-Demand segment adjusted EBITDA improved to $4.4 million or a margin of 10% from $2.6 million or a 4.9% margin in the prior year quarter. Consulting segment adjusted EBITDA was $5 million or an 11.6% margin compared to $7.8 million or a 14.1% margin in the prior year quarter. Europe and Asia Pac segment adjusted EBITDA was $0.8 million or a 4.2% margin, up from $0.2 million and a 1.3% margin in the prior year. Outsourced Services segment adjusted EBITDA was $2.3 million or a 23.3% margin, up from $1.4 million or a 14.7% margin. Reasons include cost reduction efforts, improved gross margins, and effective management of consultant utilization.
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Analyst Views on RGP
Wall Street analysts forecast RGP stock price to rise
1 Analyst Rating
1 Buy
0 Hold
0 Sell
Moderate Buy
Current: 3.670
Low
10.00
Averages
10.00
High
10.00
Current: 3.670
Low
10.00
Averages
10.00
High
10.00
About RGP
Resources Connection, Inc. is a global consulting firm. The Company’s segments include On-Demand Talent, Consulting, Europe & Asia Pacific, Outsourced Services, and Sitrick. The On-Demand Talent operates under the On-Demand by RGP brand, this segment provides businesses with a go-to source for bringing in experts when they need them. The Consulting operates under the Veracity by RGP brand, this segment drives transformation across people, processes and technology across domain areas including finance and technology and digital. The Europe & Asia Pacific segment offers both on-demand and consulting services (excluding the digital consulting business) to clients throughout Europe and Asia Pacific. The Outsourced Services operates under the Countsy by RGP brand, this segment offers finance, and accounting services. The Sitrick is a crisis communications and public relations firm which operates under the Sitrick brand, providing corporate and financial services.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Leadership Enhancement: Derderian's appointment will strengthen RGP's capabilities in finance transformation, ERP value realization, and AI enablement, enabling the firm to provide holistic, scalable solutions to CFOs and their C-suite partners, addressing the complex demands of modern enterprises.
- Industry Experience: Prior to joining RGP, Derderian served as Global CFO Transformation and Consulting Leader at Genpact, bringing extensive experience in modernizing finance operating models for CFOs, which will provide RGP with valuable industry insights and execution capabilities.
- Market Orientation: RGP's CEO Roger Carlile noted that Derderian's appointment reflects market trends, and by strengthening CFO advisory leadership, the firm enhances its ability to connect strategy, technology, and execution, helping clients achieve measurable business value.
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- Virtual Investor Meetings: Management will host virtual investor meetings throughout the day, aimed at enhancing engagement with investors and increasing company transparency, thereby boosting market confidence.
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RGP (RGP) Q2 2026 Earnings Call Transcript
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See More
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- Conference Call Arrangement: Following the release, a conference call is scheduled for 5:00 p.m. ET on January 7, enhancing investor engagement and improving information accessibility.
- Replay Availability: A limited-time replay of the webcast will be available post-conference, ensuring that investors who cannot participate live can still access key information, thereby enhancing interaction between the company and its investors.
- Company Background: RGP is a global consulting firm with three decades of experience, serving 88% of the Fortune 100, showcasing its leadership and market influence in the professional services sector.
See More
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- Leadership Enhancement: Derderian's appointment will strengthen RGP's capabilities in finance transformation, ERP value realization, and AI enablement, enabling the firm to provide holistic, scalable solutions to CFOs and their C-suite partners, addressing the complex demands of modern enterprises.
- Industry Experience: Prior to joining RGP, Derderian served as Global CFO Transformation and Consulting Leader at Genpact, bringing extensive experience in modernizing finance operating models for CFOs, which will provide RGP with valuable industry insights and execution capabilities.
- Market Orientation: RGP's CEO Roger Carlile noted that Derderian's appointment reflects market trends, and by strengthening CFO advisory leadership, the firm enhances its ability to connect strategy, technology, and execution, helping clients achieve measurable business value.
See More
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- Executive Participation: RGP's CEO Roger Carlile and CFO Jenn Ryu will participate in Truist Securities' inaugural Human Capital Virtual Conference on March 12, 2026, highlighting the company's leadership in the professional services sector.
- Virtual Investor Meetings: Management will host virtual investor meetings throughout the day, aimed at enhancing engagement with investors and increasing company transparency, thereby boosting market confidence.
- Global Service Network: RGP operates 40 physical offices and multiple virtual offices worldwide, engaging with over 1,500 clients annually, demonstrating its extensive influence in the professional services industry.
- Industry Recognition: As of January 2026, RGP has served 90% of the Fortune 100 companies and has received multiple industry awards from U.S. News & World Report and Forbes, further solidifying its market position.
See More
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- Executive Appointment: RGP has announced the promotion of Jennifer Jones to Chief Strategy & Experience Officer, tasked with aligning the company's strategic objectives with industry trends, customer needs, and market opportunities to drive growth and efficiency.
- Leadership in Transformation: Throughout her career, Jennifer has led large-scale transformations across brand, customer experience, and service design, leveraging human-centered design to modernize organizations while enhancing connections with their clients.
- Marketing Innovation: As the former Chief Marketing Officer, Jennifer spearheaded the relaunch of RGP's global brand, significantly elevating market awareness and accelerating pipeline growth through a data-driven marketing transformation.
- Vision for the Future: Jennifer emphasized that future success lies in connecting ambition with humanity, where strategy and execution are intertwined, and that a people-centered approach will be crucial for driving RGP into its next phase of growth.
See More
RGP (RGP) Q2 2026 Earnings Call Transcript
See More
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- Revenue Decline: Resources Connection, Inc. reported Q2 revenue of $117.7 million, down 18.4% from $145.6 million year-over-year, indicating a lack of positive momentum in market execution that could impact future market share.
- Gross Margin Decline: Gross margin decreased from 38.5% to 37.1%, primarily due to rising healthcare costs and increased holiday pay, highlighting challenges in cost control that may affect profitability.
- Net Loss Improvement: The net loss for Q2 was $12.7 million, significantly improved from $68.7 million in the prior year, with the net loss margin decreasing from 47.2% to 10.8%, indicating progress in aligning cost structure with revenue levels.
- Adjusted EBITDA Decline: Adjusted EBITDA was $4.0 million, down 58.8% from $9.7 million year-over-year, reflecting ongoing challenges in restoring profitability, which may affect investor confidence.
See More
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- Conference Call Arrangement: Following the release, a conference call is scheduled for 5:00 p.m. ET on January 7, enhancing investor engagement and improving information accessibility.
- Replay Availability: A limited-time replay of the webcast will be available post-conference, ensuring that investors who cannot participate live can still access key information, thereby enhancing interaction between the company and its investors.
- Company Background: RGP is a global consulting firm with three decades of experience, serving 88% of the Fortune 100, showcasing its leadership and market influence in the professional services sector.
See More
