HireQuest Reports Financial Results for Third Quarter 2026

GOOSE CREEK, S.C., Nov. 12, 2026 /PRNewswire/ -- HireQuest (Nasdaq: HQI), a national franchisor of on-demand staffing and direct-hire recruiting services, today reported financial results for the third quarter ended September 30, 2026.

Rick Hermanns, HireQuest's President and Chief Executive Officer, commented, "Our third quarter results reflect continued momentum across our core commercial staffing brands, as improving demand delivered another quarter of year-over-year revenue growth. Our franchise model continues to demonstrate its resilience, allowing us to grow alongside our franchisees as they benefit from a strengthened labor market.

"We believe the improving demand environment we have seen throughout 2026 positions our franchisees well as we close out the year and look ahead to 2027. We have a strong balance sheet and ample liquidity, and we remain focused on disciplined capital allocation as we work to deliver consistently profitable results and enhanced value for our shareholders," Mr. Hermanns concluded.

Third Quarter 2026 Review

Franchise royalties in the third quarter of 2026 were $8.2 million compared to $8.1 million in the prior-year period, an increase of 1.5%. Service revenue was $604,000 compared to $387,000 in the prior-year period. The third quarter of 2025 included approximately $479,000 in franchise royalties and $61,000 in MRINetwork national advertising fund fees within service revenue related to the divestiture of certain assets and liabilities associated with the permanent placement franchisee base of HQ MRI Corporation on January 1, 2026 (the "MRINetwork Assets Divestiture"). Pro forma for the MRINetwork Assets Divestiture, franchise royalties increased 7.9% in the third quarter of 2026.

Total revenue in the third quarter of 2026 was $8.8 million compared to $8.5 million in the prior year period, an increase of 4.0%. Pro forma for the MRINetwork Assets Divestiture, total revenue increased 11.1% in the third quarter of 2026.

SG&A expenses in the third quarter of 2026 were $6.1 million compared to $5.1 million in the third quarter of 2025, an increase of 20.7%. SG&A expenses in the third quarter of 2026 included $1.3 million in write down of notes receivable, primarily related to the repossession of a franchised location during the quarter. Net workers' compensation expense was approximately $434,000 in the third quarter of 2026 compared to a net workers' compensation benefit of $99,000 in the prior-year period. The third quarter of 2025 included approximately $616,000 in operating expenses related to the MRINetwork Assets Divestiture.

Depreciation and amortization in the third quarter of 2026 was approximately $763,000, compared to $752,000 in the third quarter of 2025.

Interest and other financing expense in the third quarter of 2026 was approximately $35,000 compared to $62,000 for the third quarter of 2025. Interest and other financing expense will fluctuate as the Company utilizes the line of credit for acquisitions or other short-term liquidity needs.

Net income in the third quarter of 2026 was $1.7 million or $0.12 per diluted share, compared to net income of $2.3 million, or $0.16 per diluted share, in the third quarter of 2025.   The decrease in net income for the quarter was primarily attributable to the approximately $1.3 million in write down of notes receivable, primarily related to the repossession of a franchised location and higher net workers' compensation expense.

Adjusted net income for the third quarter of 2026 was $3.0 million, or $0.22 per diluted share compared to adjusted net income of $3.3 million, or $0.23 per diluted share, in the third quarter of 2025.

Adjusted EBITDA for the third quarter of 2026 was $4.5 million, consistent with adjusted EBITDA in the third quarter of 2025.

System-wide sales for the third quarter of 2026 were $131.2 million compared to $133.6 million for the third quarter of 2025. The decrease was primarily driven by $15.8 million in system-wide sales related to the MRINetwork Assets Divestiture, partially offset by a $7.5 million increase in system-wide sales of HireQuest Direct and a $6.6 million increase in system-wide sales of Snelling. Pro forma for the MRINetwork Assets Divestiture, system-wide sales increased 11.4% in the third quarter of 2026.

Year-To-Date 2026 Review

Franchise royalties for the nine months ended September 30, 2026 were $21.8 million compared to $22.3 million for the same period in 2025, a decrease of 1.9%. Service revenue was $1.6 million compared to $1.3 million in the prior-year period. The nine months ended September 30, 2025 included approximately $1.6 million in franchise royalties and $205,000 in service revenue related to the MRINetwork Assets Divestiture. Pro forma for the MRINetwork Assets Divestiture, franchise royalties increased 5.7% for the period.

Total revenue was $23.4 million compared to $23.5 million in the same year-ago period, a decrease of 0.5%. The nine months ended September 30, 2025 included approximately $1.8 million of total revenue related to the MRINetwork Assets Divestiture. Pro forma for the MRINetwork Assets Divestiture, total revenue increased 7.8% for the period.

SG&A expenses in the first nine months of 2026 were $14.4 million compared to $16.2 million for the same period of 2025, a decrease of 11.1%. Workers' compensation expense was approximately $513,000 for the first nine months ended September 30, 2026 compared to approximately $56,000 in the prior-year period. The nine months ended September 30, 2025 included approximately $1.9 million in operating expenses related to the MRINetwork Assets Divestiture, $1.1 million in acquisition related charges, and $350,000 in write down of notes receivable expense. The nine months ended September 30, 2026 included a non-cash loss of approximately $1.5 million in write down of notes receivable expense, primarily related to the repossession of a franchised location in the third quarter of 2026.

Depreciation and amortization in the first nine months of 2026 was approximately $2.3 million, up slightly compared with $2.2 million in the first nine months of 2025.

Interest and other financing expense for the nine months ended September 30, 2026 was approximately $72,000 compared to $277,000 in the prior year period. Interest and other financing expense will fluctuate as the Company utilizes the line of credit for acquisitions or other short-term liquidity needs.

Net income in the 2026 year-to-date period was $5.9 million or $0.43 per diluted share, compared to net income of $4.7 million, or $0.34 per diluted share, in the same year-ago period.

Adjusted net income for the nine-month period was $8.1 million, or $0.59 per diluted share compared to adjusted net income of $7.2 million, or $0.52 per diluted share, in the first nine months of 2025.

Adjusted EBITDA for the nine months ended September 30, 2026 was $11.8 million compared to $10.6 million in the same prior-year period.

System-wide sales for the first nine months of 2026 were $351.6 million compared to $377.9 million in the same period of 2025. The decrease was primarily driven by the loss of $49.4 million in system-wide sales as a result of the MRINetwork Assets Divestiture. Pro forma for the MRINetwork Assets Divestiture, system-wide sales increased 7.1% for the period.

Balance Sheet and Capital Structure

Cash was $1.1 million as of September 30, 2026, compared to $3.9 million as of December 31, 2025. Total assets were $95.7 million as of September 30, 2026, compared to $88.2 million as of December 31, 2025. Total liabilities were $25.7 million as of September 30, 2026, compared to $19.9 million as of December 31, 2025. 

Working capital as of September 30, 2026, was $38.0 million compared to $33.0 million as of December 31, 2025. 

As of September 30, 2026, assuming continued covenant compliance, availability under the line of credit was approximately $40.5 million based on eligible collateral, less letter of credit reserves, bank product reserves, and current advances.

During the third quarter of 2026, the Company paid a quarterly cash dividend of $0.06 per share of common stock, declared on September 1, 2026. The Company intends to pay a $0.06 cash dividend on a quarterly basis, but the declaration of any dividend and the exact amount each quarter will be based on its business results and financial position and is subject to board of directors' discretion.

Conference Call

HireQuest will hold a conference call to discuss its financial results.

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization.

The conference call will be broadcast live and available for replay at https://www.webcaster5.com/Webcast/Page/2359/54668 and via the investor relations section of HireQuest's website at https://hirequest.com/.

A replay of the conference call will be available through Thursday, November 26, 2026.

About HireQuest

HireQuest is a franchisor of staffing solutions with a footprint across the U.S. and international markets. Through its primary divisions - HireQuest Direct, HireQuest Health, Snelling, TradeCorp and DriverQuest - the company delivers temporary, direct-hire, and contract workforce solutions across a wide range of industries, including construction, light industrial, healthcare, finance, manufacturing, hospitality, logistics and more. From on-demand staffing to direct hire recruiting, HireQuest's divisions work together to provide workforce solutions that help businesses grow and create meaningful opportunities for the communities we serve.  For more information, visit www.hirequest.com

Important Cautions Regarding Forward-Looking Statements

This news release includes and our directors and officers may make certain estimates and other forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act, and Section 21E of the Exchange Act, including, among others, statements with respect to future revenue, franchise sales, system-wide sales, net income and Adjusted EBITDA (a non-GAAP Financial Measure); operating results; dividends and shareholder returns; anticipated benefits and synergies of any proposed transaction and future opportunities, including statements regarding value, profitability or growth prospects, cost synergies of any merger or acquisitions including those we have completed in 2023 and 2024; intended office openings or closings; expectations of the effect on our financial condition of claims and litigation; strategies for customer retention and growth; strategies for risk management; and all other statements that are not purely historical and that may constitute statements of future expectations. Forward-looking statements can be identified by words such as: "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will," and similar references to future periods. 

While we believe these statements are accurate, forward-looking statements are not historical facts and are inherently uncertain. They are based only on our current beliefs, expectations, and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy, and other future conditions. We cannot assure you that these expectations will materialize, and our actual results may be significantly different. Therefore, you should not place undue reliance on these forward-looking statements. Important factors that may cause actual results to differ materially from those contemplated in any forward-looking statements made by us include the following: the level of demand in and financial performance of the temporary staffing and permanent placement industry; the financial performance of our franchisees; our franchisees' and our customers' ability to navigate successfully the challenges posed by instability in the financial and capital markets and the overall economic environment including the impact of increases in the price of oil and gas and any potential recession; changes in customer demand; the extent to which we are successful in gaining new long-term relationships with customers or retaining existing ones, and the level of service failures that could lead customers to use competitors' services; workers' compensation expenses that fluctuate from period to period based on the mix of classifications, the level of payroll, recent claims resolution, and cumulative experience; significant investigative or legal proceedings including, without limitation, those brought about by the existing regulatory environment or changes in the regulations governing the temporary staffing and permanent placement industry and those arising from the action or inaction of our franchisees and temporary employees; strategic actions, including acquisitions and dispositions and our success in integrating acquired businesses including, without limitation, successful integration following the acquisitions of Ready Temporary Staffing, TEC Staffing Services, MRI Network, Snelling Staffing, LINK, Recruit Media, Dental Power, Temporary Alternatives, Inc., and subsequent or smaller acquisitions; the possibility that any strategic target will not agree to consummate a transaction or that any such transaction is consummated on different terms than currently anticipated; the possibility that conditions to the completion of a proposed transaction, including the receipt of any required shareholder approvals and any required regulatory approvals, will not be met; the possibility that we may be unable to achieve expected synergies and operating efficiencies within an expected time frame or at all and to successfully integrate any acquired operations with ours; the possibility that such integration may be more difficult, time-consuming, or costly than expected, or that operating costs, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, or suppliers) may be greater than expected following a proposed transaction or the public announcement of a proposed transaction; disruptions to our technology network including computer systems and software whether resulting from a cyber-attack or otherwise; natural events such as pandemics, severe weather, fires, floods, and earthquakes, or man-made or other disruptions of our operating systems or the economy including by war or political turmoil; and the factors discussed in the "Risk Factors" section and elsewhere in our Annual Report on Form 10-K filed with the SEC.

Any forward-looking statement made by us in this news release is based only on information currently available to us and speaks only as of the date on which it is made. The Company disclaims any obligation to update or revise any forward-looking statement, whether written or oral, that may be made from time to time, based on the occurrence of future events, the receipt of new information, or otherwise, except as required by law.

Non-U.S. GAAP Financial Measures

This document contains supplemental financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). Management uses these non-U.S. GAAP measures in its analysis of the Company's performance. These measures should not be considered a substitute for U.S. GAAP basis measures nor should they be viewed as a substitute for operating results determined in accordance with U.S. GAAP. Management believes the presentation of non-U.S. GAAP financial measures that exclude the impact of specified items provide useful supplemental information that is essential to a proper understanding of the Company's financial condition and results. Non-U.S. GAAP measures are not formally defined under U.S. GAAP, and other entities may use calculation methods that differ from those used by us. As a complement to U.S. GAAP financial measures, our management believes these non-U.S. GAAP financial measures assist investors in comparing the financial condition and results of operations of financial institutions due to the industry prevalence of such non-U.S. GAAP measures. See the tables below for a reconciliation of these non-U.S. GAAP measures to the most directly comparable U.S. GAAP financial measures.

Company Contact:
HireQuest
David Hartley, Chief Financial Officer
(800) 835-6755
Email: [email protected]

Investor Relations Contact:
IMS Investor Relations
John Nesbett/Jennifer Belodeau
(203) 972-9200
Email: [email protected]

SOURCE HireQuest