SThree (STEM) Q1 2025 TU earnings summary

Market environment and trading performance

• Q1 performance remained stable, consistent with Q4 FY2024, despite ongoing global uncertainty and challenging market conditions.

• Net fees declined 15% year-on-year, mirroring Q4's rate, reflecting sector challenges.

• New business remains soft but improved sequentially, while contract extensions are robust, especially in core STEM services.

• Employed Contractor Model, now 47% of Contract business, continues to outperform independent contracting.

• Permanent segment saw improvement in the U.S., with growth in new placement activity and a lower rate of decline.

Technology and operational initiatives

• Technology Improvement Programme expanded to 80% of global operations, enhancing infrastructure and sales consultant productivity.

• Launched new AI-driven tools, including Summary AI and a proprietary timesheet AI solution.

• Delivered 31 platform releases in the period, enabling weekly updates and improvements.

• Specialist teams support clients through technology transitions, applying learnings across regions.

Regional and segment performance

• Life Sciences net fees declined 11% year-on-year but improved sequentially, especially in the U.S.

• Engineering declined 15% year-on-year, Technology 17%, both reflecting tough trading conditions.

• DACH region net fees down 14%, Netherlands (including Spain) down 16%, UK down 30%, and USA down 9% year-on-year.

• Netherlands and U.K. saw significant declines in contract net fees, especially in technology roles.

• Group headcount reduced by 5% since FY2024, reflecting managed churn and selective hiring.