ASGN (ASGN) 7 Feb 242023 Q4 Earnings call transcript

Greetings. Welcome to the ASGN Incorporated Fourth Quarter 2023 Earnings Call. [Operator Instructions] I will now turn the conference over to your host, Kimberly Esterkin, Vice President of Investor Relations.

You may begin.

Good afternoon. us Conference ASGN's Call. joining Full Quarter for XXXX Year you today Fourth for and Thank With Officer; Marie Officer. Rand are Blazer, me Ted President; Perry, Hanson, Chief Chief Executive Financial

that would to I statements. started, get contains forward-looking we remind Before everyone our commentary like

our statements our are release Although such, of are obligation subject And results these filings. statements. described Certain could press differ SEC risks reasonable, to we call. are in statements not they uncertainties and in do risks today's assume and update believe to uncertainty. those made and these actual this as We on materially from any these

For our convenience, of can Relations supplemental materials section be found our website your remarks the investors.asgn.com. Investor prepared in at and

will as cash to measures, non-GAAP be referencing release. Please included Reconciliations note are non-GAAP GAAP also certain measures. in adjusted today's and GAAP free adjusted between we such net flow. income, These the comparable intended measures and that on supplement call, are EBITDA, non-GAAP measures press this

I Executive Officer. will Ted Hanson, call Chief the now to over turn

Thank and at of for above quarter Fourth revenues, Year our margin ranges. and Full the margin EBITDA ASGN joining Earnings end results with you you, Call. and Quarter XXXX fourth achieved gross ASGN's the solid Kim, top all adjusted thank in guidance or

surpassing billion, watermark, During annual high performance, our of which XXXX, revenues commercial $X.X a totaled IT approximately new controller. Highlights of and commercial revenues billion. $X.X billion government was in reached $X consulting

like few to background mind on we adjusted segment From With as the margin results, review for with in business I'd of year. profitability our stabilizers contributed a ongoing EBITDA keep to to key an expense performance. perspective, as along a management, that our themes highlight our XX.X%

financial we and current start, Today's great difficult To operating an as was or slowdown. in we had witness is model the mix our the operations a to and yet during Therefore, business not economy. the time crisis same pandemic. tested our the revenue first current economic XXXX

evidenced despite as by results, our I solid say year challenges. progress can macro full confidently made However, that ASGN

Our our year. and cost unique supported structure the throughout business and go-to-market variable strategy, the margins

our federal Second, but providing mix our services diverse showed operating to countercyclical model not X right that we out of support do have industry we also government businesses, the commercial our only we demonstrate verticals. works, balance

the to our relationships purposely Third, officially cycles. quarter, long-standing our build we can resulted the revenues our full and consulting a of ahead XX% throughout achievements consolidated trusted a in strategically of client revenues. shape of well for And target. IT growth IT These proactive business efforts surpassed that Consulting, year from market in fourth perform

commercial Our countercyclical ballast These services improves. cyclical more rallies indicators businesses, offered downside as the sustained the federal while businesses. economy have historically commercial or leading more seen government cyclical on

pyramid mix, revenue potential. provide typically in higher our evolving provides higher IT is way services demand margin up are am duration and we positioned operating model the that is IT that end, well value Importantly, to us longer our recovers. our greater as certain leaving visibility with consulting I and work

beginning performance segment our our Commercial. our to revenue with turn let's segment mind, in themes largest these With in

the offset enterprises that by declined this more assignment Commercial across low for verticals. our in of companies business, teens business. for Revenues and Our areas double-digit services large Commercial by the from declines segment segment cyclical diverse Fortune segment revenues quarter X consulting our growth year-over-year. industry XXXX did in

roughly compared for year Commercial the consulting to period. X% increased the revenues ago quarter,

approximately consulting Solid XX-month translated bookings a year-over-year comparison. book-to-bill basis. the X.Xx $XXX of Favorable macro commercial and growth of challenges trailing difficult on million to given a

consulting Fortune clients XXXX our roster. new we Another positive, continue to add through

towards we existing on renewals saw consulting than the our and projects. slightly work Similar are on longer teams client retention remain quarter, to more customers work, strong, rates new new third Beyond contracts bookings opportunities. engaging weighted

As their in that consulting deliberate the on their quarter enter investments contracts year certain IT first many we for remain XXXX, spending clients of our remain of the extended.

continue Nevertheless, service. the quarter growth in our value clients that to our clearly ASGN of the recognize the during bookings fourth indicates

and support our ramp as spend. are to clients' model they well teams IT Our positioned maps operating their road up

verticals: Turning vertical. in commercial TMT, vertical saw industrial on performance basis billable industry performance. to day day growth said, central verticals That in and All on flat declined our sequential simply relatively and adjusted the basis X year-over-year. healthcare we adjusted billable a and a X consumer

in telecom, e-commerce improvements consumer utilities, and included verticals and sub media, discretionary, providers, Sequential healthcare account. software services

on Commercial areas. multiple across work service remained Our solid bookings with

to continues use AI on preparation, focus work platforms. data clients implementing Our their pipeline grow AI as developing our of and cases

continue such, AI our accelerator hire customer programs, in and current subject we develop experts, mind. our with train teams As each to needs manner

For clients. team our for example, upscale is leveraging partnership to Microsoft become Apex our even application with development to developers our more productive Systems

aerospace help another the with team Microsoft health In and an CoPilot, time parts technology digital and significantly new instance, example, cogeneration to of data for another enabled automotive shorten time provider. substantially services our reduced manufacturer. lines a review us at Microsoft

Apex Salesforce productivity. solutions build AI personalized collaborating improved been data-driven we've able technologies, on several with ServiceNow's AI and other to gain and IT journeys, marketing the campaigns and Microsoft, refinery with road of schedules maps, generative Systems customers' holistic IT generative to addition In our a companies is automate technologies. view Leveraging

managers, Our also predictive XX and personalization, technical team increased Fortune telecom mass company the a for Databricks revenue to have engineers, Snowflake Microsoft scientists, help project modeling and its of developers with combination marketing Azure, campaigns. data generation and used of

acquired transaction ahead XX duration our clients' rapidly period. critical deep assess with this fourth quarter, expertise meaningfully associated With over remediate our and Services, partner AI worked traction, with a in reduced its to needs compliance breach risk clients' closely with cybersecurity and of Azure in line. Microsoft environments gaining entities. IT X,XXX integration cloud platforms leveraging cybersecurity mobilities By our In Amazon time planned data are regulatory during Web to their increasing. We we newly risk team also Fortune and mitigate healthcare insurer the we

our We've sector DNA also our grow cybersecurity commercial to help work. public integrated

each and to ECS being which by We clients. Our Commercial professionals by has of our methods been our cybersecurity Department leveraged have our Fortune now client drive response, believe past security XXXX for and Defense will qualifications list. intelligence across combined at developed continue is tested of that gathering, proprietary and incident expertise the instrumentation efforts our

the of services, solutions Federal were Committee the revenues. at or Speaking turn of now quarter, our Defense, Civilian segment revenues trailing quarter billion up for X.X% government end to mission-critical the which a segment's of and our XX-month Contract Agency. of the the coverage was provides our Federal ratio Industry public Intelligence X.Xx the $X sector fourth backlog Vertical, Department year-over-year. let's segment, healthy to federal

trailing approximately New XX-month book-to-bill $XX to X.Xx on basis. of a awards were a million, translating

past this due traditional were to of Bookings award deferrals combination half a and quarter of first seasonality into XXXX. soft greater-than-anticipated the

the as bids work have bookings each award rather awaiting pickup a than timing already levels resulted near highest well the in been. as and ever activity opportunities in The and lower we lost issue are midyear. a submitted pipeline Our they in QX from the contract

We of expect XXXX. the bookings stronger first half in

bookings with community by were agencies. several fourth quarter, work intelligence the U.S. civilian the In led and

this And from external program. work FBI vulnerabilities. continue is to to work and and and the contract. designed secure under FBI's QX, breath internal This blue manage we networks example, won we mission-based in monitor red cybersecurity For additional the

the large booked IDIQ our on announced team in work addition November this that fourth contracts in multiple-award to new quarter, government future. past In ECS bid work X also allow to the

with has prime billion With partnered IDIQ won this a of won office. the inflation the VAS this we with is a interferes contract $XX.X the better contract. prime first office and ECS but we XXXX, technology, time

Under cybersecurity awarded Task project this and this are under strategy out amongst quarter. the services, other third enterprise services. year fourth provide range orders quarter ECS this technical planning, including IDIQ and full management, software to of contract, the system of networking engineering, will in expected be a come IT in support,

won billion S national a DARPA's Projects IDIQ agency the of prime government. program contract support, the $X.XX with outside Advanced Agency, also to an working provide security analytical of inside Research is develop Department partners the to for breakthrough mission technologies Defense federal and with technical, DARPA, Defense, and We

has on under of in was more this to ECS IDIQ. under lead Success of partner XXXX than XX large prime a awardees helped this million X for new award our $XXX been DARPA contract well-respected X a previous years. And contract.

to that, Marie now the to first discuss quarter With fourth results quarter call in our the over I'll turn guidance. XXXX

Thanks, this Ted. everyone afternoon. It's to with great speak

Fourth top end As Ted business, the continued revenues our growth engagement guidance holiday government noted, $X.X strength range continued were commercial our of revenue for federal our the contract of above and our consulting commercial in due the expectations billion to during in exceeded segment. quarter. season, quarter

Revenue at for high tough of stream, consulting, million, year-over-year in fourth segment XX.X% Commercial the up quarter compared the largest to prior quarter. $XXX.X down a of $XXX.X margin Revenues growth million, from difficult XXXX. year XX.X% the despite the of was revenue market conditions totaled X.X% comparison our Commercial

full the on revenues improved XX.X% year, consulting For as-reported basis an improved Commercial X.X% organically. and

for Commercial solid revenues we reached billion our $X revenues Commercial in consulting noted. Ted consulting as the year, the With XXXX, growth in over in previously

assignment the Growth in continued Commercial our softness by more revenue, businesses. an was year-over-year reflecting decline XX.X% parts offset in in consulting cyclical revenues of

revenues $XXX.X government assignment XX% X.X% year-over-year. XXXX. million, year, were compared from Revenues full up the declined segment federal our For to

organically. basis XX.X% For revenue the X.X% improved full by year, Federal as-reported Government segment on an and

down a XXX of Turning business margin higher segment. points margins. largely consolidated mix margin to mix gross to basis related federal The over from last our including within revenues at XX.X%, was the compression certain a margin lower government year. of a of quarter was revenues lower high-margin our year-over-year segment Commercial On in gross fourth basis, mix,

certain was revenue. marketing due margin creative lower to of XX.X%, permanent high-margin offset consulting primarily Gross IT segment placement higher high-margin and Commercial revenue, mainly the year-over-year, basis assignment for digital mostly XX revenue by mix down points a of mix the stream,

licensing Gross government XXX due to margin of a revenues. basis XX.X%, for year-over-year the mix higher margin down points segment lower was federal

or SG&A expenses $X.X improvement quarter not expenses. revenues SG&A $XXX.X lower or in estimates. prior expenses compensation the of due guidance million strategic for of This XX% that the to our compared year. $XXX.X and also million in planning XX% included included mainly incentive to acquisition, in fourth were million expenses revenue integration was were

million, to EBITDA adjusted XX.X%. expected, margin expense refinancing interest $XX.X $XXX past and related our EBITDA interest rates was rising year-over-year August. Adjusted was income million. Net was increased this As and

quarter quarter the million, million new at increase cash $XX.X cash XX.X% At an of $XX.XX. for flow senior Free of equivalents year-over-year. on under availability and $XXX.X was revolver. million quarter price and XXX,XXX cash end, deployed shares during the approximately secured in $XXX.X fourth full we an repurchase were had million, the We our attractive $XXX cash of

in cash free full We in year-over-year. at of million, flow totaled shares XXXX year, deployed $XX.XX. the XX.X% $XXX repurchase For on [ million average of the an cash ] $XXX.X X.X increase an million

We strong $XXX.X have under have we acquisitions revolver, full the remaining availability With to roughly and once strategic powder free improves. million cash our ample M&A generation make dry share authorization. repurchase market our under flow

to Turning guidance.

XXXX supplemental materials. and Our financial estimates in our These estimates market on first for forth current release of conditions. are quarter based earnings set are

assume than XX.XX the a estimates days of lowest X.XX period year ago also first more Guidance fewer in days year. days the billable seasonality the Our first quarter XXXX. billable billable with quarter, the traditionally than X.XX consider QX of and

of move on that to downward fourth the XXX payroll quarter. margins important we at occurred calendar impact from approximately first tax the also year. is adjusted as of the Having beginning EBITDA to points remember the reset basis It every

conditions in the expect to challenging market quarter. first We remain

government we our consultants. growth across Declines be soft offset Commercial segment. anticipate and to in expected by revenues will are partially our in continued assignments segment, federal remain revenues Commercial our In

decline due our to gross to revenues commercial expect to greater businesses. federal cyclical mix similar including trends, continued year-over-year and more business softness We current of margins that's a government a in

remain year-over-year. will margin SG&A cash Our relatively consistent

to to expect are XX.X%. adjusted to quarter, $X.XXX million, flow XX.X% $XX.X to $XXX.X share our continue With of EBITDA billion for $XXX.X cash first an and of $XX.X this free we allocate reestimating revenue repurchase. of M&A, estimating million, we to background, to move billion adjusted margin million million EBITDA income of the In towards $X.XXX

I'll remarks. back call now you. some Thank turn to Ted the for closing

Marie. Thanks,

term. positive we near the the future, all While are signs continued about indicate softness in

to continuing ASGN financial needs. IT I to market helped we've taken cannot prime develop industry position difficult their close seat back months. enough so this our one hold our thank ever clients our not your mean a as evident maps. to past discussions ongoing these work performance of proactively have our you harder, a to relationships. clients' is to and year, our teams our support for strategic client of past digital service continuing resilient the hard as transformation IT XX we've worked However, each Rather, road staying in we yourselves, an leader, offerings every Each regular and does are that and about

And services their won't the up IT clients right, projects the investment naturally IT fully is been pushed IT in for not need and ramp of while completely they for their fastest certain ASGN more ways the table. to one road off have be reengage to are map. our The strong,

footprint multiple Our to priced as has And our at provide talent is is pool nearshore with able across domestic as in scale, and deep competitively Mexico ever a now highly solid capabilities that it been. skilled we also geographies. are

business proactive in strategy plan. ASGN's segments the with business reflect highlighted our position shaped today aligned needs. of clients' our I increasing competitive years is service demand and of IT to our several differentiated start industry As are today's offerings and go-to-market thoughtful We've and at result of the call,

in on our success. of as will focus taking strengthening IT we ASGN efforts that our opportunities position clients' consulting projects We and our higher efforts XXXX value drive capabilities, higher IT for end, advantage pursue

fourth call to for open Operator, quarter questions. year again our joining XXXX you full call. Thank the and please

Maggie Instructions] comes Nolan our And from William of Blair. first [Operator question line the with

wondering I'm through cadence -- of revenue can you've additional us information and on give October how you from the January that what any and here seen? demand if

in ahead than a of slowing thought. maybe is little And were throughout We said for for question. a January this other most we or number. the the furloughs softer would program couple I pretty that whole Maggie, demand a for little through that. fourth spending. weeks our of it together firm would the steady. quarter, Thanks hung the you therefore, say I had of last say lot than Not was part, the October in we bit Ted. And

you think then same demand now. was to see start seasonally, can predicting about quarter right what our we're little the a we similar see the as I in first the a the can in guidance, third on although slower quarter it's always quarter. And -- quarter, based

how think margins from then, segment, of about impacts the what mix? mentioned Commercial particular. And may is And it. the Marie, What within you here? gross surprised your outlook remarks, mix the in some that in coming Got I mix you margin impact over prepared the for your quarters

to couple of Maggie, mix. a things as relates it

And carry quarter forward things the that of we saw are the what kind so will some there in from definitely to fourth first quarter.

the the The than segment, lower which higher first is government really has a Commercial. mix

of a seeing then just side, government, And so with countercyclical the discretionary especially aspect we perspective. areas are softer we've margin those the on the just just from highlighted commercial that. And

and those higher-than-expected I And the Market Marie first the what yes, demand segment, of But areas. creative marketing mostly in digital said, some quarter. federal driven highlight would the by in the it's that in you'll in being perm. see growth

BMO with of line question Markets. Silber next the Jeff from Capital Our comes

You cited a couple of verticals.

wrong, on day Commercial, TMT forgive might going sequential markets in What's base, and verticals saw day that seeing? a are adjusted some segments. it other those that of me. was growth have I you're still the That gotten basis. but I different those a think billable Industrial from on

Yes. you one? to Rand, do that want take

strong remain Well, and for sectors, held see first if particularly sectors kind XX TMT you also growing them, industrial of its the area. had in that in example, utilities consumer provider look Jeff, actually own, sequentially our comprised and in energies you Yes. and We all, of what Healthcare and mostly space. quarter. those I the within of the think, grew

just and enumerated move grow third in look some those continuing you them saw that at text, specific see fairly the industry quarter. we think along. areas, the you further previous can we've fourth general and in I nice the was than healthy sectors see you quarter the And to it to more which quarter over of look So are sequentially below when in

But just on talked catch we move can I some being projects some or the the sector, and starts kind you're you an as And government deferred, on hopefully, curious, to rest helpful. of not think those. expect through considering of federal those That's I'm go Okay. year, up timing about going of to down in all is Should with uncertainty the of we the that it year, do year? of rest mindset and deferrals will the kind election going delays the continue? Washington, you in

much to to I job. out the on say to think hand, would like Well, street get on as possible the good one the administration

On the dealing have. fourth extent of new work on a work the of other they're we the delay. decisions may in But on the I deal hand, start quarter. to that, we with continue to continuing resolution. And that year bigger that they continue the the to form we'll think saw be some with And

it things loss So a waiting said ever those is that part hope some submitted to first wasn't but as adjudicated, high see we in those of we of an of we're our it's do most here, not fourth. issue remarks, work, as the in get our going on our of the quarters as been, in awards decided pipeline X as

of with the question comes from next Sommer Our Truth line Securities. Tobey

renewals the X little the ago? area, business better, that same consulting or business. did Commercial the mix had of than months is X? growing it running But the recent new better than -- closer as say or parity quarter XX% new more to bit Or a is there Within that you with X

the Rand, it's previous same quarter, pretty as right? the much

probably is maybe XX-XX little That's But was XX-XX. it of in QX. work, cycle, between typical of little And beginning bit which there of in the been with consistent the year. was correct. but a and the yes, a for was 'XX, a It business always year balance more. earlier new It's bit

ago, XX variance project changes maybe rather it size saw any doing there? Any perceive? months you out as Year, piecemealing having in out projects at customers that you were all coming once. down, than Sizes

still project project year slight I is a elongating quarters and at bit the How the size through on of spend the has started the continued quarter. much out say couple last would a the upward fourth that is trend. stretching of and end last

So certainly fine. size, yes, project the they're

what AI we're AI projects the mentioned work the work -- won and quarter, some I have processing in fact, looking side, the quarter. the Ted some with technology. think from -- we We totem in is larger third chip now call some fourth in at at the move you In pole looking I up power one, in

into the have AI apps embedding We their apps.

have You cloud building use migration Tobey, on. and cases a of going lot prep, data algorithms. we and infrastructure see building more now data

closer real AI use areas. into the cases closer getting work and of work. in we're the cases, the So to data area insertion clients' use to more to more going execution in business see our the we're of And prep

the Okay. government And to kind business. I ECS on double-click want of

have than seen better here treasury that and that, and Your do focused the outlays performance from what seeing. you're publicly had a on between trends larger we've good line? actually of How book-to-bills been relying companies and discrepacy I trade the contracting several the square substantially broader

government seasonally one Tobey, of I ones the detailed the for the we below are are for like we think track we release, but haven't some QX. peers that

where of lot the submitted weighting real we vagary of think take a the on of are in versus have award bidding I what on and size where confidence our are in relationships. But relationships number places bidding I and it's our theirs. versus we they what

it fourth And we been to quarter. below still closer typical have would have a one might while a We quarter. been in our in so little

first how to we the see we'll adjudicated in we're that things the waiting out second. there that about and have go positive we're and quarter and they here into the be to have So

line from Joseph comes question Canaccord next Genuity. with the Vafi Our of

And on just side there a like? across more little the maybe know and some for green on some you're maybe that, I just -- I we the then or leading assignment what a assignment on commentary looking sequential and at verticals shoots seeing follow-ups. indicator, basis. I start it's it's maybe have early if a

I here. steadiness. I'll green So I can say Joe, in there. They're and Rand there think chip wouldn't are that start shoots

we -- that and when against we ways can of a we in couple flow see So our order that can index then industry see performance.

As that now sequentially and an mentioned adjusted growing on we that's X industries it one are have earlier, flat. Rand basis

out So than that's just improvement from X, more need ] X. but an X of [ we

and of So mean typically have I we'll I quarter not the develops. assignment to this would say how part see in steady, green the it's business. shoots,

QX, about You and come across it's lower coming saw. level in year. that's the out slightly of seasonally we what we a into at saw what QX And prior and

quarter say you I'd difference then of to no there. ground, spend. as begin reclaiment first if the budgets kind will, you And really clients release spend So and

would what anything so we're as go. And you Rand, kind of that? else monitoring we that's here add to

see it's an consulting, leading to on shoots RFP, Joe, if the with and just are. quick next you work their piece a and maps, what staffing release transaction clients the of will, about and some Ted, that ahead road In there's go Well, up In can business, environment. let assignment we me we discussion very projects process comment. of There's about bid green potentially because type or side the a win. of

if requirements. year. see once And for flow, once much there that clients are release light they'll So boom, we've with past from and corporate, seen will, budgets the we'll will, the different they get are you approved they sitting green than requirements

right, question. to nobody based. time going go ahead, your an at and buildup says really transactional see all, Green shoots working we it's that and So helps Joe, a come end, of to until do can from more hire if people. -- more thought part can we revenue perm toward in where anything going quick gives and Certainly, proactive corporate of be placement is internal is the

then is digital how world model standing business stand lower-cost transformation down and forward. in obviously, in maybe consulting upward drill maybe center. the helping trajectory. on forward move moving maybe an And just we Sure. seeing evolution and because to need some a still with not enterprises that And bit little and is delivery color. still, others any the can't Mexico That's on great Geos -- services keeping we're lead more -- And

-- well, they're I looking get to that's I mean right, for done to critical are aware them here that kind I I critical, continue face the fully are started things very clients way budgets. released that in that either things. Joe. haven't think of think even or that are haven't things a look, of type mean, our

And so center. there they've like turned our over by seen center. to Mexico full last opportunities in I growing plus delivery even that delivery a the time few years, utilization in short And We've here headcounts are mean, XXx. our

So a good example. I think really it's

the you at the more They stuff. City to areas. teams that U.S., clients a certain lower-cost to they're developers have just to U.S. markets. broadly are see They're all willing in Jersey Here in price thinking get differently about hour, to look right can don't lower project sitting exorbitant cost across certain much per in have other willing that

year their longer here adjudicate time. So to there's their then and of are clients begin to think taking release matter But would I for movement reinforce sure. that. this But for I it's only a going just fully on that here around and budgets plans that to

Joe? If add I that? can something Ted, wouldn't to you mind,

Yes, sure. Absolutely, Rand.

insertion everything in is growth code our investment AI that with we competitive, services to insertion clients' Development in architecture. But is for stay AI modern implementing techniques of made large AI there's new then clients. and techniques, said There Ted to which our the enterprise own talked And in cost And big He do our a correct. the our language we're Maxim that We to the since about competitive have the done Center. and Mexico. we've languages. better all that now seen languages, we've in

think makes Mexican adoption that moving fact are in the asking latest which is more the clients these for the right that keeping we more it's understand these technologies, I with talk about to is good And not which our the center, want even we're out sign AI a date the for that, to up AI Mexico. of techniques They center in we're us path, them -- our competitive that. and is a have interesting, on efficient good So center just us but our clients. about makes because that

allocation. maybe And I'll free one helpful. and capital really great here, cash then to share on see great That's in The buybacks. just flow it's more is the sneak

-- it the I you -- to here? Just M&A that is Or what to right really the like it wanting wondering targets good feels to down do time bolt-ons. are market kind -- not it some wasn't know be nice Because of seeing heard now it say I might feels dynamic like that sell for is Marie just a there?

me want it? take to Ted,

would you're So be I capital I -- love that to right. Joe, think acquisition so opportunities. to mean, we allocating now right strategic

and of the trade there's to other still But assets private not the would reasons, market and fulfill all invest because kind in equity inorganically on think to means holding whether be ready. a bunch of this going watch wholeheartedly, remain time. opportunities seen real thinking kind mentioning quality out. have flow, our support meantime, are going in the our to Board focused organically. we're here. the a on measure and we here all better we'll debt is and underlying like kinds quite you've it's which a now. We that shopping clients invest I earlier to a it's supporting things take share about. around Rand in of to know would little tight of And just more whole of things. do. ready we're that's We're us And and markets we repurchases, stay But to the just which dearth valuation, we very what list, what was we and can And bit where opportunities will. defined -- in right if the committed are you what going We know And

from line with Our Childress Andre next question comes of the Baird.

on Andre for is Marcon. This Mark

some actually follow-up something the just of those on. your the change unleash some RFPs what them about green It maps and consulting those that on with execute side. shoots to execute needs earlier But is to So Rand general they your my on to in a have first to maps? environment question like conversations clients, the road want on in those said road sounds clients based of for

want do Rand, on follow that? up you to

a has Yes. I since been we've spends mean, been IT public ever function company, of our thesis corporate a earnings.

they're providers hope have more. spend side a as the when sequentially. secure then to going it that the and I runway feel more the going It's think I feel They're the say do small would We as think to and their they earnings that? consumer industrial conclusive. corporate secure like TMB we and I saw to back So that. data spending segment to what of add goes start from health care ahead. on to our IT. companies we our Ted, good want that they about saw well Ted, point. That's are earnings they're But sectors security you think and feeling all that not more is

correct. No, that's

Makes a of sense. switching I And then to lot over margins. guess

fantastic kick we to or how margins You for the preserving to the And for guys job steady should margins, expect guys think but about about Or at your call we the out your talked a in? as them anything considering year? XXXX? full natural relatively you is to stabilizers there stabilizers, continue did Should even automatic mix shift. be

Marie?

Yes.

cash SG&A So implied in QX, for our our is about XX%. of kind guidance margin

you And perspective. full so as a probably about the think a pretty from good run of margin will, that's XXXX, rate, we if year

of right? been payroll have our But mean, have here a fairly That's the I outside quarter. first to going doing higher. the influence reset, You're tax SG&A margins look, the little quarter it first consistent

for expect they below-the-line look XX%, this were Andre. same the and thing, So right at of over year, I just to should kind adjusted you about think stuff,

line comes with of Seth Fargo. question next the from Our Wells Weber

with This TMT. and us It could talk are year? of little have the commercial we new Maybe bit the a John Seth. some kind federal could like just you give as about fruit. cyber what been on side kind if the efforts for looking cross-pollination more more for and bearing maybe of information is about we just cyber sounds between clients the the maybe enter side if And

Rand, want do to that? talk you about

start. I'll Well,

stronger probably the would systems cybersecurity the commercial of and segment. on and our protection say man the in is think data more then I government I our federal

-- there If of have at commercial years, big past you been breaches companies. look the commercial

So track government I on cybersecurity. has great federal the I'm here the and great groundwork calls laying record guess for

cybersecurity mentioned. ECS of over I the transferable important calls to them, some think in government. the And that team I them for federal because center technologies great great we Commercial take that resonating with Our backdrop very That's sector. agencies and to has in had in when our just it's over our

is okay? So I say would it's simple that,

cognizant any on outlook Circle. 'XX And quick digital terms in space a any potentially then we trends of on comment just maybe you viewing Great. be given year, kind marketing seen anything of? follow-up and should in election the Creative Could the of

Rand?

funny. the couple company hours ago. talk I a was off Fortune got him. to a of a call just And XXXX it It's of CMO company, to interesting

I give to question and personalize technologies out AI There's one And that make our produce I have market that I it first think think, our clear clients of of it do CMOs to their in to aware held as which we're our being imposing. also that what personal. still great of Circle talking you that multiple to on whole Creative that earnings to or position message But think bread-and-butter marketplace I spend client. It things function of plays in. there Translating a AI, mass creative of is. it. some And all, get a being that is or through tight that their the part service. mediums of kinds channels creating allows to use well there depending talks to it like I the corporate about my and to are do there of also is are for the also we're

So -- there's a lot of opportunity out there.

they're think trying out all the way I figure best understand and path. through their to it it work and

and you they're I some streaming companies. see advertisement. In is some without reporting charging that for the whether of up. technology think or some changing whole cases, with are advertisement how the The they're can not. streaming in from In dollars world want you cases,

move on can world that we and feel that recalculated, think they a a going once see in on a is And good and has on plethora be get companies of there will. the past footing we're opportunity solid going they're forward. So to if lot marketing to I digested you

utilities starting As I said consumer to companies, media there. before, get in and and they're certain in

line comes with question next the from of Surinder Thind Our Jefferies.

talent in as up those is but part about just earlier delivering picture commercial use perspective you your in percentage thinking large ask sense the headcount talked model delivery that? question do projects. you owned the of competitive build to your guys I versus reason investing a Just positioning you of a And big that building consulting delays the of that How the the from maybe of you a growth in business. Can here how terms guys. terms you pool, manage temporary by in continue of the you're kind resources of talk if out about not about is

directly these Well, Fortune the business the on have look, it's way client traditional all IT that with And into through customers' -- XXXX the staffing today, XXX-plus all, Surinder, including business, got first IT consulting. we've of street these that had the enterprises. from all feet relationships group of relationships

doesn't change. don't client up, if -- that need to build need to will. opportunities. address So we that We just And you

have. if that more, can and we And a little scale into so obviously it always takes

just are we the And expertise solutions Consulting our that's which And a I working model On of meet about then staffing oriented helping And a architect IT the the team contingent on solution members smart again, note we mean, got great. come from XX% industry together. the capabilities. our our projects delivery with workforce, on is teams of industry different. very you side, team we've project top, customer. to need have our XX% little put these to

will continue a fit. think team craft they as experience, it to but place here going we going can and model be right right on to a more is They're point I price on industry in that we're teams skill the every in And right because are bear it perfect project contingent at perfect the so definitely to so set, the with more our to we that build, here. go bring labor our

So because of expertise competitive. see price that's And we customer can our not for the we our really but cost bear. and all-in that work a also been only bring point, that proposition is to you winning of win the

to going the there. course we're So stay

just we then your just, kind for I terms assume the guess, some following question difference? the on I maybe How at it up Excellent. outlook between point in is the consulting staffing about what that to trended And for 'XXs? in think here. commentary And versus is your bill point there rate then bill trends, terms this how services? difference the should And services over point? on price at of maybe guess, How material of able you're much I of this of what's 'XX? a

milestones. we we're basis XXX of points it certain sure, the get right? better in And amount a it's for consulting deliverables that or than responsibility get or and some XXX taking bill a better So tell we in better our the we light here IT is staffing. margin, evidenced for by rate what you is Well, can fact margin because is on or

what bill that, And second get question, was part so mean, the from Surinder, sorry. to And I'm your we're no there's rate. question a about that. of I better able

projects, you're the Or for rates? I with use better of and better -- skill having kind rate wanting to outlook hold terms pricing of for sets a little able to are you Or because harder advantage your 'XX are you asking do clients, AI you is or to to that the about conversations are talk that that find? maybe clients in those bit In mean, as to can steady? rate maybe get more

doesn't and it's I If really a it's better in it's solution and set right? solution orientation, the a skill a can harder we rate, higher-end a we look, it in matter get anytime -- find Well, better to get think orientation, can whether rate. it's

that So stands at. all

margins, markups, been I -- work rates that you rising, that and in part our and the improve we will, and of if pretty consultative And support more slightly will we're steady AI Our and and mix with more our do here, doing. bill those. only have yes, here work is parcel think are that

Got it.

mix. the referring referring I wasn't level of could actually for So the I in charge I what versus ask you the 'XX? question certain to was apologize 'XX charge may them think what you you able apples-to-apples be I if engineer in actual didn't to of to a comparison

would versus typically, would that anything underlying that bill in now. a it 'XX us expect trend in that we'll down. expect We I slight seeing not get increase see don't is different We're -- a I any mean year-to-year. 'XX. our I tell right rates

status of that. benefits Surinder. applies cost grows, a -- built associated the And Ted, it's lot the Keep bill that highly projects. are the of asking grows it's types, where are skill and rates It's not more for discussing add discussed But consulting mind, and per of job, our per an to rates in exceptions its hour, and can the to important bill are the availability as in you're are hour with cost to and rates they us. business job bill cost hour. per staffing escalators depending grows there I individual cost on and what consulting skills, with staffing of what what is

I don't in? projects. price turn I help clarify, sure I to maybe just in -- firms implying hour. Because do doing not Is to comment. that want But bill guess to projects consulting the fixed generally, want that a just make that by you're me fixed I price want lot They most miss do to more

So engineers... you have

type looking When timing -- you Does it but taking of the cost clients No. that, -- material not work. doing with around this job. start on the total we build imply conversations the at by can -- cost the what's

with and work. and that decision time can choice is around and You around associated delivering cost the it a work that build but the the the material, risks ultimate of any by benefit -- conversation and competitive where

from our America. comes question And Bank of of the Heather line next Balsky with

could Heather staffing. Emily I seeing was Balsky. if This what you wondering this for in And you permanent us on of staffing about saw you're Martel was talk the for percentage sales to quarter? what is

Marie, do you want...

Yes, absolutely.

revenue quarter, perm a total X.X%. fourth the we actually was -- percent for yes, of as So

will, very similar in steady. for mean say fourth not the the our from the it's Heather, of there, again, percent there's I historic here think really change, if the you're seeing I'd no or and it's quarter ranges. low expectation mix, to And third is I first you what

And remarks. for we Ted to Hanson of call back closing reached our I'll turn end now have the question-and-answer over session. the

quarter Great. our discuss today here Well, appreciate fourth I everyone's to and of for quarter first soon our to and XXXX forward being the release that very we with followed, look attention you Q&A results.

lines this your This your today's concludes you. Thank participation. disconnect you time. conference, may for at and Thank you