Company: KELYB
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0000055135-25-000052
Chunk: 91

Company: KELLY SERVICES INC
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 8
Chunk 91
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 2024 and the impact of the sale of EMEA staffing operations in both years.

June Year-to-Date Results

Revenue from services in the first six months of 2025 increased 7.8%, which was primarily driven by the acquisition of MRP in May 2024. Excluding the impact from the acquisitions, revenue from services decreased 1.6% year-over-year with decreases in the ETM and SET segments partially offset by an increase in the Education segment. Compared to the first six months of 2024 and excluding the impact from the acquisitions, revenue from staffing services decreased 1.6% and revenue from outcome-based services decreased 2.9% from the prior year. Revenue from talent solutions increased 2.6% and permanent placement revenue decreased 19.8% from the prior year, excluding the impact from the acquisition.

Gross profit increased 10.2% largely driven by the acquisition of MRP.  Excluding the impact from the acquisition, gross profit decreased 3.1%. The gross profit rate increased 50 basis points to 20.4% primarily due to an 80 basis point increase due to the acquisition of MRP, partially offset by a 20 basis point decrease related to business mix and other and a 10 basis point decrease related to lower permanent placement fees.  The gross profit rate decreased in the ETM and SET segments excluding the acquisition and increased in the Education segment.

Total SG&A expenses increased 13.3%, primarily due to the acquisition of MRP.  Excluding the impact of the acquisition, SG&A expenses decreased 0.7%. SG&A expenses in the first six months of 2025 include $16.7 million of integration and realignment costs related to initiatives to integrate MRP and other prior acquisitions, consolidating operating segments, and further aligning processes and technology across the Company, $0.5 million of executive transition charges and $0.4 million of transaction costs related to the sale of our EMEA staffing operations.  Included in SG&A expenses in the first six months of 2024 were $7.1 million of transaction costs related to the sale of our EMEA staffing operations and $6.6 million of transformation and restructuring charges relating to 2023 initiatives.  Excluding the impact from the acquisition, as well as integration and realignment, transaction, executive transition, and restructuring and transformation charges-and excluding depreciation and amortization-SG&A expenses were flat to the prior year.

The gain on sale