Resources Connection, Inc. (NASDAQ: RGP) today announced its financial results for the first quarter of fiscal 2026, ending August 30, 2025. Revenue was $120.2 million, a 13.9% decline on a same‑day constant‑currency basis versus $136.9 million in the prior year quarter. Gross margin improved to 39.5% from 36.5% in Q1 FY2025, while the company posted a net loss of $2.4 million, a significant improvement from the $5.7 million loss reported a year earlier.
Segment results showed On‑Demand Talent revenue of $44.4 million, Consulting revenue of $43.6 million, Europe & Asia Pacific revenue of $19.9 million, and Outsourced Services revenue of $10.0 million. The company also reported a 39.9% share of revenue for SG&A expenses, totaling $47.9 million, down $1.0 million from the $48.9 million recorded in Q1 FY2025. Notably, the quarter was free of goodwill impairment charges, contributing to the improved profitability profile.
Cost discipline and margin expansion were highlighted by a 2.5% adjusted EBITDA margin, up from 1.7% in the same period a year earlier. The company attributed the margin lift to a higher pay‑to‑bill ratio, increased consultant utilization, and reduced overhead costs, including a $2.4 million reduction in employee compensation and benefits following a 2025 restructuring. The press release also noted a $1.0 million improvement in SG&A relative to the prior year, driven by lower travel, entertainment, and technology transformation expenses.
Management provided forward guidance for the second quarter of fiscal 2026, projecting revenue of $115 million to $120 million, a gross margin of 38% to 39%, and SG&A expenses of $43 million to $45 million. The company emphasized continued focus on cost structure optimization, expansion of its consulting capabilities in CFO advisory and digital transformation, and strengthening its on‑demand talent offering. These guidance figures represent a modest improvement over the prior year’s outlook and signal confidence in the company’s strategic transformation.
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