JOB · GEE Group, Inc.

GEE Group's fiscal 2026 second quarter results reflect a significant turnaround in profitability, driven by the absence of prior-year non-cash charges (goodwill impairment and deferred tax valuation allowance totaling $31.8 million), growth in higher-margin direct hire placements, gross margin expansion, and cost reduction initiatives. Direct hire revenues increased 7% to $3.2 million, while total revenues declined 20% to $19.5 million, primarily due to the loss of a large, low-margin contract staffing account following its acquisition. Excluding that account, total revenues would have decreased 10%. Gross margin improved to 38.1% from 34.1%, benefiting from a favorable revenue mix shift toward direct hire (100% margin) and the elimination of the low-margin account. SG&A expenses fell 20% to $7.4 million, with cost reduction initiatives contributing $1.3 million in savings. The company generated net income of $14,000 compared to a net loss of $33.0 million in the prior-year quarter. Adjusted EBITDA turned positive at $108,000 versus a loss of $597,000. Management remains cautiously optimistic about demand for direct hire placements and continues to implement AI tools and cost controls. The company also filed a universal shelf registration statement on Form S-3 for up to $100 million in securities, providing financial flexibility for potential M&A or strategic transactions. As of March 31, 2026, GEE Group had a strong balance sheet with $20.3 million cash, no debt, and $4.9 million undrawn credit facility.