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SEC filingRevenue declined 16.6% to $107.9M amid soft demand and delayed project starts, but losses narrowed sharply with operating loss improving 83.2% to -$8.3M due to absence of prior-year goodwill impairment and cost discipline from workforce reductions.
Gross profit decreased 15.0% to $38.6 million from $45.4 million, yet the gross margin remained stable at 35.7%, demonstrating underlying pricing and utilization discipline even as revenue softened. The narrower decline in gross profit relative to revenue underscores effective management of the pay-bill ratio amid these headwinds.
Operating income improved dramatically by 83.2% to a loss of -$8.3 million from -$49.7 million, with operating margin at -7.7%. This progress stems from the absence of the prior-year's significant goodwill impairment charge, combined with cost reduction initiatives including the October 2025 workforce reductions (October RIF) focused on management and administrative roles to enhance efficiency, reduce costs, and streamline operations. Amortization of capitalized ERP system costs continued within SG&A, supporting technology transformation efforts.
Net income followed suit, narrowing 78.5% to -$9.5 million from -$44.1 million, translating to diluted EPS of -$0.28 versus -$1.34. These improvements highlight restructuring gains offsetting revenue weakness, positioning the company for resilience in a challenging macro environment.