HireQuest (HQI) Q1 2026 earnings summary

Executive summary

• Achieved solid operational execution and profitability in Q1 2026, demonstrating resilience amid a soft staffing market and macroeconomic headwinds, supported by a debt-free balance sheet and franchise staffing model.

• Maintained a record of profitability every year since formation, with double-digit compounded annual growth in system-wide sales and adjusted EPS from 2019 to 2025.

• Revenue for Q1 2026 was $6.5 million, down 12.7% year-over-year, primarily due to the divestiture of MRINetwork assets and lower royalties from certain brands.

• Net income after tax was $1.6 million ($0.11 per diluted share), up from $1.4 million ($0.10 per share) last year.

• Adjusted EBITDA was $2.7 million, slightly down from $2.8 million, representing 40.8% of revenue.

Financial highlights

• Q1 2026 total revenue was $6.5 million, down 12.7% year-over-year, reflecting the divestiture of MRINetwork assets.

• Franchise royalties were $6.1 million, compared to $7 million in Q1 2025; service revenue was $462,000, down from $512,000.

• System-wide sales were $102.6 million, compared to $118.4 million in Q1 2025, with $16 million of the prior year’s sales from divested assets.

• Net income after tax was $1.6 million ($0.11 per diluted share), up from $1.4 million ($0.10 per share) last year.

• Adjusted net income was $1.8 million ($0.13 per share), flat year-over-year; adjusted EBITDA was $2.7 million, slightly down from $2.8 million.

Outlook and guidance

• Favorable weekly year-over-year comparisons emerged in the second half of Q1 and have strengthened in Q2, indicating improving demand.

• Management expects to leverage the franchise model for consistent profitability throughout 2026, citing a stabilizing job market.

• Liquidity is expected to remain strong, with sufficient cash, receivables, and credit facility availability for at least the next 12 months.

• Management is optimistic about sustained momentum and improved staffing market conditions for the remainder of 2026.

• Quarterly dividend of $0.06 per share planned, subject to board discretion and business results.