10-K: ManpowerGroup Reports 2025 Net Loss Amid Profit Plunge

ManpowerGroup reported a significant net loss and operating profit decline in 2025, despite slight revenue growth, driven by goodwill impairments and restructuring costs.

Summary

• ManpowerGroup reported a net loss of $13.3 million in 2025, a substantial decrease from net earnings of $145.1 million in 2024.
• Diluted net loss per share was $0.29 in 2025, compared to net earnings per share of $3.01 in 2024.
• Revenues from services increased slightly by 0.6% to $17,957.1 million in 2025 from $17,853.9 million in 2024.
• Operating profit decreased by 50.9% to $150.1 million in 2025 from $306.0 million in 2024, with the operating profit margin falling to 0.8% from 1.7%.
• Gross profit margin decreased by 60 basis points to 16.7% in 2025, primarily due to declines in permanent recruitment and mix shifts towards enterprise accounts.
• Goodwill and other impairment charges totaled $88.7 million in 2025, significantly impacting profitability.
• Restructuring costs increased to $64.2 million in 2025, up from $53.6 million in 2024.
• Cash used in operating activities was $104.1 million in 2025, a significant reversal from $309.2 million generated in 2024, mainly due to increased accounts receivable and capitalized cloud computing implementation costs.
• Days Sales Outstanding (DSO) increased by approximately three days to 55 days as of December 31, 2025.
• Debt as a percentage of total capitalization increased to 45% in 2025 from 31% in 2024, following the issuance of new Euro-denominated notes.
• The Americas segment saw a revenue increase of 2.9% (4.4% in constant currency), driven by Manpower staffing, Talent Based Outsourcing (TBO), and Right Management outplacement services.
• Southern Europe revenues increased by 2.7% (but decreased -2.0% in constant currency), with France experiencing a -1.6% revenue decrease (-5.9% in constant currency).
• Northern Europe revenues decreased by -4.3% (-8.3% in constant currency), primarily due to decreased demand in Experis interim and Manpower staffing services.
• APME revenues decreased by -5.5% (-6.3% in constant currency), largely due to the disposition of the South Korea business in 2024, though organic constant currency showed a 7.4% increase.
• Manpower brand revenue increased, while Experis and Talent Solutions brands experienced decreases during 2025.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this as a negative report due to the significant net loss, sharp decline in operating profit, and negative operating cash flow, despite slight revenue growth. The substantial impairment charges and increased debt levels are concerning, though some markets show signs of stabilization.

Positives

• Overall revenues from services increased by 0.6% in 2025 compared to 2024.
• Improved trends were observed in the second half of 2025, with sequential improvement in key demand indicators like Manpower associates on assignment in the United States and France.
• Signs of stabilization and inflection were noted in certain markets such as Italy and Spain.
• The Americas segment experienced a revenue increase of 2.9% (4.4% in constant currency), driven by increased demand for Manpower staffing, Talent Based Outsourcing (TBO), and Right Management outplacement services.
• The APME segment showed a 7.4% increase in organic constant currency revenue, despite an overall reported decline due to dispositions.
• A new enterprise resource planning (ERP) system, Oracle Cloud ERP, was successfully implemented for the North America segment and Corporate.
• The company maintained investment-grade credit ratings (Baa1 with stable outlook from Moody's and BBBwith negative outlook from Standard & Poor's).
• A strong liquidity position was reported with $871.0 million in cash and cash equivalents and $599.6 million available under the revolving credit facility as of December 31, 2025.
• Leadership Development Programs (Future Leaders, Accelerated Leadership, Strategic Leadership) continue to develop internal talent, with a majority of participants making positive leadership career moves.
• The Board of Directors has exceeded 30% gender diversity for over 10 years, and the Executive Leadership Team is 30% women, 30% racially diverse, and 70% non-US born.

Negatives

• The company reported a net loss of $13.3 million in 2025, a significant decline from net earnings of $145.1 million in 2024.
• Operating profit decreased by 50.9% in 2025, and the operating profit margin fell by 90 basis points.
• Gross profit margin decreased by 60 basis points in 2025.
• Significant goodwill and indefinite-lived intangible asset impairment charges of $88.7 million were recorded in 2025, primarily related to the United Kingdom and Switzerland reporting units.
• Cash used in operating activities was $104.1 million in 2025, a substantial reversal from $309.2 million generated in 2024.
• Days Sales Outstanding (DSO) increased by approximately three days to 55 days as of December 31, 2025.
• The effective income tax rate jumped to 114.2% in 2025 from 43.5% in 2024, unfavorably impacted by impairment charges, lower earnings, restructuring costs, and the French corporate income tax surcharge.
• Total debt increased to $1,677.1 million in 2025 from $952.8 million in 2024, with debt as a percentage of total capitalization rising to 45%.
• Decreased demand for Experis interim services and permanent recruitment was observed across multiple segments.
• The Talent Solutions brand experienced revenue decreases due to reduced Recruitment Process Outsourcing (RPO) permanent recruitment and Right Management outplacement services.
• Northern Europe and APME segments experienced reported revenue decreases.
• Restructuring costs increased to $64.2 million in 2025 from $53.6 million in 2024.
• Dividends paid per share decreased significantly to $1.44 in 2025 from $3.08 in 2024.
• The company's stock price experienced significant volatility during 2025, ranging from a high of $62.66 to a low of $26.63.

Risks

• Volatile, negative, or uncertain economic conditions, including recessionary pressure, particularly in Europe (which accounts for 65% of revenue), could materially adversely affect business and results of operations.
• Inability to timely operate the business or respond to the rapidly changing needs of diverse clients, especially given the size and breadth of the organization, may impact financial results.
• The highly competitive worldwide employment services industry, with limited barriers to entry and increasing commoditization, could limit the ability to maintain or increase market share or profitability.
• Cyberattacks or improper disclosure or loss of sensitive or confidential company, employee, associate, or client data, including personal data, could lead to liabilities, reputational damage, and increased costs.
• Disruption, increased costs, and reputational risk may arise from outsourcing various aspects of the business to a small number of critical third-party vendors.
• Risks and uncertainties related to the development and use of AI, including potential reduction in demand for services, flawed algorithms, bias, intellectual property infringement, and new legal/regulatory challenges, could harm business operations.
• A loss or reduction in revenues from one or more large clients, who often have non-exclusive arrangements and can terminate contracts on short notice, could have a material adverse effect.
• Loss of key personnel, including officers, executive management, and local field personnel, could significantly impact operations and the ability to attract and retain business.
• Intense competition in labor markets may limit the ability to attract, train, and retain qualified personnel necessary to meet client staffing needs, especially for in-demand technology skills.
• Global operations are subject to numerous risks beyond control, including political unrest, regional/international hostilities, natural disasters, health crises, and infrastructure disruptions.
• The ability to attract and retain business and employees depends on the company's reputation, which is susceptible to damage from disputes, security breaches, or negative publicity.
• Changes in client attitudes toward the use of staffing services due to pressure from organized labor, political groups, or regulatory agencies could adversely affect the marketplace for services.
• Limited ability to protect thought leadership and other intellectual property, including brands and proprietary methodologies, could impact success.
• Inability to effectively implement business strategy or achieve objectives, particularly in diversifying revenues beyond core staffing into higher-margin professional resourcing and innovative workforce solutions, could materially adversely affect financial results.
• Failure to keep pace with rapid technological changes, including the functionality and potential uses of AI, machine learning, and robotics, could lead to significant disruption to the business model.
• Sustainability commitments and disclosures may expose the company to risks, legal liability, and increased costs, including reputational harm for failing to meet goals or increased compliance burdens from new regulations (e.g., EU Corporate Sustainability Reporting Directive).
• Acquisition strategy may be unsuccessful and introduce unexpected costs, including integration difficulties, over-valuation, and unanticipated liabilities.
• Dispositions via sales, franchises, joint ventures, or other exit activities carry risks and costs, such as difficulties in separation, diversion of management attention, and reputational risks from divested businesses.
• Foreign currency fluctuations, particularly the Euro, may have a material adverse effect on reported operating results and shareholders' equity.
• Inability to meet liquidity or working capital needs, especially if clients slow payments or impose more challenging billing terms, could adversely impact cash flow and profitability.
• Inability to maintain effective internal controls could lead to inaccurate financial reporting, reputational harm, or restatements.
• Debt levels could materially adversely affect operating flexibility and put the company at a competitive disadvantage, and failure to comply with restrictive covenants could trigger prepayment obligations.
• The lenders under credit facilities may be unwilling or unable to extend credit on acceptable terms, impacting liquidity.
• The performance of subsidiaries and their ability to distribute cash to the parent company may vary, negatively affecting the ability to service debt.
• Inability to secure guarantees or letters of credit on acceptable terms may substantially increase the cost of doing business in various countries.
• Changes in tax rates, adoption of new United States or international tax legislation (e.g., Pillar Two, French corporate income tax surcharge, WOTC expiration), or tax audits could result in additional income tax liabilities.
• The price of common stock may fluctuate significantly due to various factors, resulting in losses for investors.
• Challenges meeting contractual obligations if the company or third parties fail to deliver on performance commitments could materially adversely affect client relations, revenues, and profitability.
• Government regulations in many jurisdictions (e.g., France, Italy, Germany, Japan, Mexico) may prohibit or restrict certain types of employment services, impose additional licensing or tax requirements, or mandate new benefits/pay parity, reducing future earnings.
• Failure to comply with antibribery and corruption laws, such as the Foreign Corrupt Practices Act and the UK Bribery Act 2010, could materially adversely affect the business.
• Exposure to legal claims, including employment-related claims (discrimination, wage and hour, wrongful termination) and class action lawsuits, could result in monetary damages, fines, or negative publicity.
• Exposure to antitrust and competition law risk, with past investigations in France and other countries, could consume resources and result in liabilities.
• Provisions under Wisconsin law and the company's articles of incorporation and bylaws could make the takeover of the company more difficult, potentially causing the stock price to decline.

Future Outlook

ManpowerGroup expects its overall cost structure to decline due to significant restructuring actions initiated in 2025. The company plans to continue monitoring expenses closely while investing in growth, productivity, technology, and digital capabilities. Management anticipates continued stable activity levels across North America and Europe, with improving trends in certain reporting units extending into 2026. The estimated pension expense for 2026 is approximately $16.0 million. The French government's Finance Bill for 2026 includes a one-year extension of the corporate income tax surcharge, and the United States Work Opportunity Tax Credit (WOTC) has not been renewed for 2026, which, if retroactively applied, would reduce the estimated tax rate by 1.0% to 1.5%. The net amount of pre-tax derivative gains and losses in Accumulated Other Comprehensive Loss (AOCL) expected to be reclassified into earnings over the next 12 months is not anticipated to be significant.

Management Comments

• "After a volatile start to 2025, reflecting macroeconomic and geopolitical uncertainties, including the impact of policy shifts and global trade dynamics, we have seen improved trends in the second half of 2025."
• "Employers remain deliberate in their workforce hiring strategies, yet engagement levels are steady and activity levels are becoming more consistent."
• "We are seeing clear sequential improvement in key demand indicators, including Manpower associates on assignment in key markets including the United States and France."
• "Although we are encouraged by signs of stabilization and signs of inflection in certain markets such as Italy and Spain, these trends reinforce our view that the shape of the recovery can be different by market with some inflecting earlier and others requiring longer periods of stabilization before inflecting."
• "We are focused on managing costs as efficiently as possible in the short term while continuing to progress transformational actions aligned with our strategic priorities."
• "We believe our available cash and existing credit facilities are sufficient to cover our cash needs for the foreseeable future."
• "We believe our reputation, along with our brand equity in the ManpowerGroup name and our various other brands, are important corporate resources that help distinguish our services from those of competitors and also contribute to our efforts to recruit and retain talented employees."
• "We believe that all people deserve to feel safe, respected and able to thrive in the workplace."
• "We see diversity as a strategic enabler of our business and therefore we are focused on actions to support our diverse organization, our culture and the impact we have on the communities we serve across the globe."

Industry Context

StockSavvy.ai notes that the global employment services industry is highly sensitive to economic cycles and remains large and fragmented. Key industry trends include the increasing demand for skilled labor, employers' desire for more flexible working models, and ongoing consolidation. The rapid expansion of AI and technological change presents both opportunities for operational efficiency and risks of reduced demand for traditional services, further exacerbating existing talent shortages, with 74% of companies reportedly unable to find the skilled workers they need. ManpowerGroup's strategic focus on upskilling programs (MyPath, Experis Academy) and higher-value workforce management solutions aligns with these evolving industry dynamics, aiming to mitigate commoditization and adapt to changing client needs. Geopolitical events and inflationary pressures continue to significantly impact demand, particularly in Europe, which accounts for 65% of the company's revenue, highlighting the interconnectedness of global economic conditions on the sector.

Comparison to Industry Standards

• ManpowerGroup operates in a highly competitive and fragmented industry, competing with global leaders like The Adecco Group and Randstad, as well as regional and specialized firms such as Recruit Holdings, Allegis Group, Kelly Services, Robert Half, Kforce, PageGroup, Korn/Ferry International, and Alexander Mann.
• The company's strategy to diversify revenues beyond core staffing into higher-margin professional resourcing (e.g., Experis in IT recruitment) and innovative workforce solutions is a common industry response to combat commoditization and provide greater value-added services.
• The reported decline in permanent recruitment and interim margins due to mix shifts towards enterprise accounts suggests that ManpowerGroup is facing competitive pricing pressures, a prevalent challenge in the staffing industry, especially with larger clients who often engage multiple firms.
• ManpowerGroup's extensive global footprint of approximately 2,100 offices in over 70 countries and territories provides a competitive advantage in serving large national and multinational clients who seek uniform service across borders, a key differentiator in the industry.
• The company's investment in AI-enabled assessments and HR tech stack (PowerSuite) for RPO and MSP offerings reflects an industry trend towards leveraging technology for more predictive, precise, and efficient talent solutions, aiming to stay competitive against technologically advanced peers.

Management Changes

Corporate Governance

Legal Proceedings

• The company is involved in litigation of a routine nature and various legal matters, which are being defended and handled in the ordinary course of business.
• Accruals for loss contingencies are recorded based on the circumstances of each claim when a loss is probable and can be reasonably estimated.
• Management believes the ultimate resolution of these legal proceedings will not have a material effect on the business or financial condition.
• The company is subject to antitrust and competition law in the United States, the European Union, and many other regions, with past investigations in France and other countries.
• The company is exposed to legal claims, including employment-related claims such as discrimination, harassment, employee pay (wage and hour requirements), wrongful termination or retaliation, and actions or inactions of workers.
• The company has devoted considerable time and expense to resolve several California-based wage and hour claims in the past and is often sued by plaintiffs in various other employment-related matters, including those seeking class action status in the US.

Stakeholder Impact

• Shareholders: Experienced a negative impact due to a net loss, significant decrease in operating profit, lower dividends per share, and stock price volatility. Increased debt levels and goodwill impairments could raise concerns about financial health and future returns.
• Employees: Restructuring actions in 2025, leading to decreased personnel costs and severance payments, indicate job reductions. However, ongoing leadership development programs and a focus on diversity, inclusion, and mental wellbeing aim to support and develop the remaining workforce.
• Customers: Decreased demand for Experis interim and permanent recruitment services, and Talent Solutions, suggests some clients may be reducing or shifting their workforce needs. The company's focus on innovative workforce solutions and AI integration aims to adapt to and better serve evolving client demands.
• Creditors: Increased total debt and a higher debt-to-capitalization ratio could lead to increased scrutiny from creditors, although the company maintains investment-grade credit ratings. Compliance with debt covenants under the new credit agreement is crucial.
• Suppliers: While not directly mentioned, general economic slowdowns and the company's cost management efforts could indirectly affect relationships and terms with suppliers.

Next Steps

• Continue to monitor expenses closely to maintain the benefit of efforts to optimize organizational cost structures.
• Invest appropriately to enable business growth in the future and enhance productivity, technology, and digital capabilities.
• Begin the Accelerated Leadership Program (XLP) for 25 employees in 2026.
• The next cohort for the Strategic Leadership Program (SLP) will commence in 2027.
• The French government will introduce legislation allowing affected pension schemes to retrospectively obtain written actuarial confirmation for historic benefit changes.
• The FASB's new guidance on disaggregation of income statement expenses is effective for the company's 2027 annual financial statements.
• The FASB's new guidance on internal-use software is effective as of January 1, 2028.
• The FASB's new guidance on hedge accounting is effective as of January 1, 2027.
• The FASB's new guidance on government grants is effective as of January 1, 2029.
• The FASB's new guidance on interim reporting is effective as of January 1, 2028.
• The 2018 500.0 Euro notes were redeemed in January 2026.
• The 2025 500.0 Euro notes mature in December 2030.
• The 2022 400.0 Euro notes mature in June 2027.
• The estimated pension expense for 2026 is approximately $16.0 million.
• A majority of the remaining $35.1 million restructuring reserve is expected to be paid by the end of 2026.

Key Dates

Recommendation

The company reported a net loss and a significant drop in operating profit for 2025, coupled with negative operating cash flow. This indicates substantial operational challenges and a deteriorating financial performance. While some markets show signs of stabilization, the overall trend is negative, exacerbated by goodwill impairments and increased debt. The dividend reduction further signals financial strain. These factors suggest a 'sell' recommendation for investors.

Keywords

workforce solutions, staffing, recruitment, human resources, HR tech, contingent labor, talent management, Experis, Manpower, Talent Solutions, RPO, MSP, Right Management, SEC filing, 10-K, financial results, corporate governance, risk factors, AI, cybersecurity, global economy, labor market, Europe, Americas, APME, debt, liquidity, sustainability, impairment charges, restructuring