ManpowerGroup Inc. Q1 FY2025 earnings call

• Jonas Prising spent time with clients in key markets, noting a shift from optimism to uncertainty due to U.S. trade policy. - Jack McGinnis covered financial results, including revenue, EBITDA, and guidance. - Emphasized diversification, digitization, and innovation strategies, including technology road map and AI implementation. - Aligned global organizational structures for brands and were named a world's most ethical company for the 16th time.

In the first quarter, revenue was $4.1 billion, down 5% year-over-year in constant currency. On an organic constant currency basis, the Manpower brand declined 2%, the Experis brand declined by 5%, and the Talent Solutions brand declined by 2%. Within Talent Solutions, RPO had a slight year-over-year revenue decrease, MSP had a strong double-digit revenue increase, and Right Management had a year-over-year revenue decline. The Americas segment comprised 25% of consolidated revenue, with $1.1 billion revenue, a 5% year-over-year increase in constant currency. Southern Europe revenue was $1.8 billion, a 5% decrease in constant currency. Northern Europe revenue was $731 million, a 14% decline in constant currency. The Asia Pacific Middle East segment had $476 million revenue, a 7% increase in organic constant currency. The Manpower brand comprised 59% of gross profit, Experis Professional 24%, and Talent Solutions 17%.

• Second quarter EPS guidance: $0.65 to $0.75. - Constant currency revenue guidance: decrease of 3% to 7%, midpoint 5% decrease. - EBITDA margin projected to be down 60 basis points midpoint compared to prior year. - French tax increase impacts second quarter EPS by $0.14.

• Economic and geopolitical uncertainty, especially U.S. trade policy affecting client demand. - Volatility in permanent recruitment and outplacement volumes impacting margins. - Currency translation impacts on reported revenues.

Q: Andrew Steinerman asked about rebound in case of U.S.-Europe tariff resolution.

A: Jonas Prising said quick turnaround possible with policy resolution, noting positive signs in France and growth in U.S. business.

Q: Manav Patnaik asked about layoffs and cost resizing.

A: Jonas Prising said employers cautious, pulling back on perm, but specialized skills still in demand.

Q: Mark Marcon asked about Northern Europe actions and French taxes.

A: Jack McGinnis discussed restructuring charges in Northern Europe and one-year French tax increase.

Q: Kartik Mehta asked about tech impact on temp staffing.

A: Jonas Prising said labor hoarding post-pandemic main factor, no structural tech impact yet.

Q: Josh Chan asked about perm weakness in certain countries.

A: Jonas Prising and Jack McGinnis discussed perm weakness due to budget uncertainty in France and composition of perm demand.

Q: Trevor Romeo asked about U.S. Manpower brand drivers and tariffs.

A: Jonas Prising talked about manufacturing impact and no immigration impact, potential benefit from reshoring.

Q: Tobey Sommer asked about capital deployment and upskilling.

A: Jack McGinnis discussed capital allocation and upskilling in areas like AI, cybersecurity.

Q: Stephanie Moore asked about hiring verticals.

A: Jack McGinnis discussed strength in aerospace, food manufacturing and weakness in public sector, auto, etc.

Q: George Tong asked about demand trends exiting quarter.

A: Jack McGinnis said April trends stable, in line with March.