What Management Said

Read the full Q3 2025 transcript ↗

I will start by going through some of the highlights of the quarter, then Jack will go through the third quarter results and guidance for the fourth quarter of 2025. Slide two of our earnings release presentation further identifies forward-looking statements made in this call and factors that may cause our actual results to differ materially, and information regarding reconciliation of non-GAAP measures. Our most recent ManpowerGroup Employment Outlook survey, covering over 40,000 employers across 42 countries, reinforces this view. Turning to our results, after 11 consecutive quarters of organic constant currency revenue declines, we crossed back over to growth during the third quarter.

The stabilization of demand in recent quarters in North America and Europe, despite ongoing tariff uncertainty, has been a key factor in the revenue trend improvements. Our ongoing modernization of the Experis offering, including enhanced consultant development and tighter integration of our PowerSuite AI tools, is supporting margin improvement and future growth as client demand recovers. Overall, for the quarter, reported revenue was $4.6 billion, down 2% year-over-year in constant currency. System-wide revenue, which includes our expanding franchise revenue base, was $4.9 billion.

Adjusting for restructuring costs, EBITDA was $96 million, representing a decrease of 22% in constant currency year-over-year. Earnings per diluted share was $0.38 on a reported basis, while earnings per diluted share was $0.83 on an adjusted basis. Adjusted earnings per share decreased at 39% year- over-year in constant currency. Looking closely at these indicators, we believe our demand in Europe and North America is holding steady, and are confident that we're well-positioned for future growth.

What went well
  • Organic days adjusted constant currency revenue increased 0.5%, crossing back to growth after 11 consecutive quarters of organic constant currency declines and slightly favorable to the flat midpoint guidance.
  • The Manpower brand grew 3% organic constant currency, with U.S. Manpower up 8% days adjusted reflecting strong market performance.
  • The Americas segment grew 6% in constant currency and the APME segment grew 8% organic constant currency, with Japan up 6%.
  • The MSP business posted continued strong double-digit revenue growth, and free cash flow was positive at $45 million as earnings stabilized.
  • Sophie AI drove measurable gains, with approximately 30% of new client revenue in the largest market derived from AI-rated probability, and the technology deployed across 14 key markets.
What went wrong
  • Adjusted EBITDA of $96 million declined 22% in constant currency, with adjusted EBITDA margin of 2.1%, down 50 basis points year over year.
  • Adjusted EPS of $0.83 decreased 39% year over year in constant currency.
  • Gross margin of 16.6% came in below guidance, driven by mix shift toward enterprise accounts (40 basis point reduction), softer permanent recruitment, and lower outplacement.
  • The Experis brand declined 7% and Talent Solutions declined 8% on an organic constant currency basis as RPO and Right Management outplacement slowed.
  • U.K. revenue fell 13% and Germany fell 23% on a days adjusted constant currency basis, with weak automotive manufacturing trends.

Guidance Changes

MetricPeriodCurrent guidance
U.S. business revenueQ4 2025similar to slightly further revenue decline (lowered due to higher seasonal Experis healthcare projects in the prior-year period)
France revenue trendQ4 2025slightly improved rate of revenue decline (reiterated improvement reflecting Q3 exit rate)
Italy revenue growthQ4 2025slightly improved constant currency growth trend (raised)
U.K. revenue trendQ4 2025improved rate of decline (reiterated improvement)
Japan revenue growthQ4 2025continued strong revenue growth (reiterated)
EBITDA marginQ4 2025relatively stable EBITDA level Q3 into Q4 (reiterated, with SG&A leverage offsetting a modest gross margin decline)

Performance Breakdown

MetricYoYNote
Total revenue (constant currency) -2% largely stable activity across North America and Europe; organic days adjusted turned positive at 0.5%
Manpower brand (organic constant currency) +3% strength in North America, Latin America, Italy, Spain, Belgium, Poland, and APME
Experis brand (organic constant currency) -7% clients shifting IT spend toward AI investments and away from traditional projects, though early stabilization signs emerging
Talent Solutions brand (organic constant currency) -8% RPO lower demand and Right Management outplacement slowdown, partly offset by MSP growth
Adjusted EBITDA -22% constant currency gross margin pressure from enterprise mix, softer perm, and lower outplacement
Adjusted EPS -39% constant currency $0.83, one cent above guidance midpoint
Americas segment revenue (constant currency) +6% U.S. Manpower up 8% and strong MSP double-digit growth
Northern Europe segment revenue (constant currency) -6% weak Germany automotive and challenging U.K. market, though OUP loss narrowed to $1 million
APME segment revenue (organic constant currency) +8% consistent Japan performance up 6%

Earnings Call Themes & Trends

TopicPrevious mentionCurrent periodTrend
Labor market conditionsQ2: encouraging signs of stabilization in U.S. and parts of EuropeQ3: frozen labor market with little hiring or workforce reduction, but distinct stabilization and Manpower growth as markets bottom out—
Transformation and global business servicesQ2: back-office PowerSuite at ~65% of revenues, 10 countries in shared servicesQ3: Porto, Portugal hub standardizing European back-office functions; preparing to apply same approach to front office—
AI commercial impactQ2: Sophie AI deployed by Talent Solutions, sales targeting engine improving lead accuracyQ3: ~30% of new client revenue in largest market from AI-rated probability across 14 markets; RPO and MSP wins cite AI as differentiator—
Experis versus Manpower divergenceQ2: Experis -9% on healthcare project non-recurrenceQ3: Experis -7% with early stabilization; divergence attributed to clients prioritizing AI investment over traditional IT projects—

Q&A Summary

When business confidence improves, would you expect an early-cycle pickup in flexible staffing, and is it odd to see soft outplacement and soft perm at once?
It is a strange, frozen labor market with little hiring or workforce reduction; if employer confidence returns, better Manpower growth is expected to lead, with other brands benefiting.
Did the quarter trend evenly, or was there volatility across major markets?
France improved during the quarter from -5% to an exit of -4% with October holding; Italy improved through September; U.S. Manpower grew steadily while Experis was more stable-ish.
On gross margin in Q4, are you seeing any price pressure or mix issues beyond perm?
Staffing margin pressure is primarily mix shift toward enterprise clients that spend the most in this environment; pricing is competitive but no dramatic changes, and it should reverse when convenience demand returns.
Can you detail the Sophie AI implementation, coverage, and metrics beyond the 30% and 14 markets?
By year-end 90% of revenues run on a common global front office platform and 60% of back-office transactions on a global platform moving to 80-90%; AI combines with human insight to lift win rates and value, still early innings.
On like-for-like enterprise gross margins in key markets, are they holding steady?
Within-country changes mirror the consolidated picture and are driven by business mix as enterprise grows faster than convenience; staffing margin actually improved in Japan, the Nordics, and Canada.
Which regions are seeing the most restructuring and headcount reductions?
Q3 focus was Northern Europe with Germany at the top of the list at $11 million; 2025 overall centered on Northern Europe, shown by the OUP improvement from a $6 million to a $1 million loss.
Will technology and AI advancements let you capture recovery growth with fewer people and greater operating leverage?
Yes; with 90% of revenues on a common global front office platform plus centralized back office, the company can standardize, centralize, and reimagine processes, as demonstrated by improved Latin America productivity.
What is driving improving SG&A leverage that holds EBITDA roughly flat into Q4 despite gross margin compression?
Cost actions are bending the SG&A curve, letting falling gross profit dollars hold EBITDA roughly flat year over year with only about a 10 basis point sequential GP change; free cash flow is expected strong in Q4.
How is the political turmoil in France affecting client decision-making?
The turmoil is not helpful to employer sentiment, but clients are pragmatic and responding to demand; the French PMI has improved and the government survived two no-confidence votes with the budget still to be resolved.

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Q3 2025 call
Reported 2025-10-16 · figures from the ManpowerGroup Inc. Q3 2025 earnings call.

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