Sign in

You're signed outSign in or to get full access.

TI

TrueBlue, Inc. (TBI)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 revenue was $386M (down 22% YoY; down 16% on comparable 13-week basis) with diluted EPS of -$0.40; adjusted EBITDA improved to $8.9M and adjusted EPS to -$0.02, reflecting disciplined SG&A reductions and favorable workers’ comp reserve adjustments .
  • Gross margin rose 50 bps to 26.6% on favorable workers’ compensation reserve development (+170 bps) partially offset by mix and pricing pressures; PeopleManagement delivered its second consecutive quarter of double-digit commercial driving growth .
  • Segment trends: PeopleReady revenue -21% on comparable basis (margin up 80 bps), PeopleScout revenue -30% on comparable basis (margin down 220 bps on lower operating leverage), PeopleManagement revenue -2% on comparable basis (margin up 220 bps on cost actions) .
  • Guidance: Q1 2025 revenue $347–$374M (-13% to -7% YoY), SG&A $93–$97M, gross margin down 30–70 bps YoY; FY 2025 CapEx $19–$23M, depreciation $24–$28M, and minimal tax expense expected due to valuation allowance .
  • Strategic catalysts: accretive HSP acquisition ($75–$85M NTM revenue; $5–$7M segment profit; 6–8x multiple) and UK Armed Forces talent advisory win to begin full service in 2027; continued rollout of JobStack and Affinix AI capabilities bolstering digital transformation .

What Went Well and What Went Wrong

  • What Went Well

    • “2024 was a transformative year… positioning the company for strong growth and expanded profitability when customer demand volumes return.” — Taryn Owen (CEO) . Gross margin improved 50 bps YoY to 26.6% on reserves; adjusted EBITDA rose to $8.9M (+73% YoY) .
    • Commercial driving services delivered double-digit growth for the second consecutive quarter; PeopleManagement segment margin expanded 220 bps due to disciplined cost management .
    • Digital progress: launch of proprietary JobStack with ReadyMatch and AI-assisted interviewing/scheduling via Affinix; examples of expanded client wins in logistics and transportation (multi-site expansions) .

  • What Went Wrong

    • Broad demand softness: temporary labor and permanent hiring volumes remained suppressed; PeopleScout revenue -30% on comparable basis (8 points from a hospitality client loss) and margin compressed 220 bps on lower operating leverage .
    • PeopleReady revenue -21% on a comparable basis with lingering client caution across verticals/geographies; pricing pressures and mix diluted gross margin offsets (-80 bps mix; -20 bps pricing; -20 bps software depreciation) .
    • EPS remained negative (-$0.40 diluted; -$0.02 adjusted) with minimal U.S. tax benefit due to valuation allowance; full-year net loss driven by impairments in 2024 .

Financial Results

MetricQ2 2024Q3 2024Q4 2024
Revenue ($USD Millions)$396.230 $382.357 $385.953
Net Loss ($USD Millions)$(104.710) $(7.635) $(11.705)
Diluted EPS ($USD)$(3.45) $(0.26) $(0.40)
Adjusted Net Income ($USD Millions)$(10.690) $(3.331) $(0.701)
Adjusted EPS ($USD)$(0.35) $(0.11) $(0.02)
Gross Margin %26.4% 26.2% 26.6%
Adjusted EBITDA ($USD Millions)$1.069 $4.679 $8.899
Adjusted EBITDA Margin %0.3% 1.2% 2.3%
MetricQ4 2023Q4 2024
Revenue ($USD Millions)$492.171 $385.953
Diluted EPS ($USD)$(0.08) $(0.40)
Adjusted EPS ($USD)$0.08 $(0.02)
Gross Margin %26.1% 26.6%
Adjusted EBITDA ($USD Millions)$5.149 $8.899
Adjusted EBITDA Margin %1.0% 2.3%

Segment breakdown (Q4 2024 vs Q4 2023):

SegmentRevenue Q4 2023 ($M)Revenue Q4 2024 ($M)Segment Profit Q4 2023 ($M)Segment Profit Q4 2024 ($M)
PeopleReady$285.185 $207.687 $7.920 $7.404
PeopleScout$47.204 $32.528 $2.910 $1.301
PeopleManagement$159.782 $145.738 $2.781 $5.695

KPIs and Liquidity:

KPIQ2 2024Q3 2024Q4 2024
Cash ($USD Millions)$26 $15 $23
Debt ($USD Millions)$0 $0 $8
Borrowing Availability ($USD Millions)$132 $133 $119

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue ($USD Millions)Q1 2025NA$347–$374 (YoY -13% to -7%) New
Gross Margin (bps YoY)Q1 2025NA-70 to -30 bps vs prior year New
SG&A ($USD Millions)Q1 2025NA$93–$97 (-13% to -9% YoY) New
EBITDA Adjustments ($USD Millions)Q1 2025NA$4 (SaaS amortization +$1; software depreciation +$1; other SG&A +$2) New
Shares (Basic WAVG)Q1 2025NA29.7M New
CapEx ($USD Millions)FY 2025NA$19–$23 New
Depreciation ($USD Millions)FY 2025NA$24–$28 (incl. $4M software depreciation in cost of services) New
Income Tax Expense ($USD Millions)FY 2025NA$2–$6 (minimal due to valuation allowance) New

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2024, Q3 2024)Current Period (Q4 2024)Trend
AI/Technology initiativesContinued rollout of proprietary JobStack; digital transformation emphasis Affinix AI-assisted interviewing/self-scheduling; JobStack ReadyMatch launch; accelerated innovation roadmap Expanding
Macro demand/cautionEconomic uncertainty and client caution weighing on volumes Uncertainty persists; temporary/permanent hiring volumes suppressed Still challenging
Commercial drivingPositive momentum; PeopleManagement footprint Double-digit growth for second consecutive quarter Improving
Healthcare expansionStrategic focus; early progress HSP acquisition: $75–$85M NTM revenue; $5–$7M segment profit Accelerating
Regulatory/migrationNA in prior PR detailClient audits increasing; on-site business wins; southern border states demand uptick Emerging tailwind
UK Government/PeopleScoutNA in prior PR detailUK Armed Forces talent advisory win; 7-year contract, full service begins 2027 Strategic win; revenue ramps later
Disaster recoveryNAPeopleReady engaged with 14 organizations in CA; recovery work in NC/FL Near-term volume support

Management Commentary

  • “We achieved a critical milestone in the digital transformation… with the launch of our new, proprietary JobStack app… and AI assisted, on-demand digital interviewing and self-scheduling using our Affinix technology.” — Taryn Owen .
  • “Gross margin was 26.6%… lower workers’ compensation costs contributed 170 bps… partially offset by mix (-80 bps), pricing (-20 bps), and software depreciation (-20 bps).” — Carl Schweihs .
  • “PeopleReady revenue decreased 21% on a comparable 13-week basis… segment profit margin was up 80 bps… PeopleScout revenue decreased 30%… margin down 220 bps… PeopleManagement revenue decreased 2%… margin up 220 bps.” — Carl Schweihs .
  • “We are already off to a strong start in 2025 with the accretive acquisition of HSP…” — Taryn Owen ; HSP outlook: $75–$85M revenue; $5–$7M EBITDA; variable term loan 6–8% interest .

Q&A Highlights

  • HSP acquisition: NTM revenue $75–$85M and segment profit $5–$7M; 6–8x multiple; expected accretive with synergy potential leveraging PeopleScout recruiting and PeopleReady capabilities .
  • UK Armed Forces (PeopleScout): multiyear contract; full service begins 2027; 7-year term with optional 3-year extension; expected to be a top client; margin mix includes media .
  • PeopleReady regional trends: improved weekly sequential revenue in February; strength in southern border states; clients’ internal compliance audits driving demand; outlook cautious but potential upside if trends sustain .
  • Disaster recovery: active engagements in CA, NC, FL; 14 organizations in CA cleanup; potential future skilled trades roles as rebuild progresses .
  • SG&A trajectory and sales model: adjusted SG&A run-rate midpoint ~$95M (includes ~$1M from HSP); on-demand organization realigned into ~360 territories with 50% increase in field sales headcount by mid-summer, cost-neutral via prior actions .

Estimates Context

  • Wall Street consensus (S&P Global) for EPS and revenue was unavailable at the time of retrieval due to SPGI daily request limits; as a result, comparisons to consensus for Q4 2024, Q3 2024, and Q2 2024 could not be provided. We will update when accessible.

Key Takeaways for Investors

  • Cost discipline and workers’ comp reserve favorability drove margin resilience; adjusted EBITDA growth and SG&A reductions position TBI for operating leverage on demand recovery .
  • PeopleManagement’s commercial driving strength is a durable bright spot; segment profit expansion underscores effective cost actions and execution .
  • PeopleScout’s near-term volume softness should be mitigated longer term by strategic wins (UK Armed Forces) and tech-led efficiency via Affinix; expect revenue growth as hiring volumes return .
  • PeopleReady’s JobStack and field sales realignment aim to accelerate top-line growth cost-neutrally; improved February weekly trends are encouraging but not yet definitive .
  • The HSP acquisition diversifies into healthcare with accretive economics and synergy potential; expect incremental margin profile above traditional staffing .
  • Liquidity remains ample (Q4: $23M cash, $119M availability; $8M debt) enabling continued investment and shareholder return capacity .
  • Near-term trading implications: headline YoY revenue decline offset by gross margin improvement and adjusted EBITDA upside; watch for confirmation of sequential demand stabilization, healthcare contribution ramp, and PeopleScout deal conversion. Medium term: thesis rests on digital execution, mix shift to higher-value roles/verticals, and operating leverage as macro normalizes .