Total revenue for the third quarter was down 25% and we posted positive net income of $9 million or $0.25 per share.
PeopleReady is our largest segment representing 61% of trailing 12-month revenue and 76% of segment profit.
PeopleReady's revenue was down 29% during the quarter and we saw intra-quarter improvement with revenue down 27% in September versus down 32% in July.
PeopleManagement is our second largest segment representing 30% of trailing 12-month revenue and 15% of segment profit.
Revenue for PeopleManagement was down 8% during the quarter with the top line down just 2% in September versus down 12% in July.
Turning to our third segment, PeopleScout, represents 9% of trailing 12-month revenue and 9% of segment profit.
Revenue was down 48% during the quarter versus down 53% in Q2.
We now have digital fill rates north of 50% and more than 26,000 clients using the app.
In Q3 2020, we filled 726,000 shifts via JobStack representing a digital fill rate of 51%.
Our client user count ended the quarter at 26,100, up 37% versus Q3 2019.
Early results indicate a 20% increase in worker throughput.
A heavy user is a client who has 50 or more touches on JobStack per month whether it's entering an order, rating a worker or approving time.
The growth differential is north of 20 percentage points and has held true even in this market downturn.
We doubled our heavy user mix since 2019, up from 11% of our business in fiscal 2019 to 22% for 2020 year-to-date.
Even in the middle of this downturn, year-to-date new business wins at PeopleManagement are up 13% versus the prior year as we've secured $70 million of annualized new business wins versus $62 million the prior year.
Over the last five years, we've returned $169 million of capital to shareholders via share repurchases.
Total revenue for Q3 2020 was $475 million representing a decline of 25%.
We posted net income of $9 million or $0.25 per share and adjusted net income of $8 million or $0.24 per share.
The Q3 year-over-year revenue decline was 14 percentage points better than the Q2 year-over-year revenue decline and the Q3 year-over-year SG&A decline was 8 points better than the Q2 year-over-year SG&A decline.
Adjusted EBITDA was $18 million, down from $39 million in Q3 2019, but up from a loss of $5 million in Q2 2020.
Gross margin of 23.3% was down 300 basis points.
Our staffing businesses contributed 230 basis points of compression with 180 basis points of pressure from negative bill and pay rate spreads and 50 basis points from mix and other items.
PeopleScout contributed another 70 basis points of compression primarily due to client mix and lower volume.
Expense was down $40 million or 31% compared to Q3 2019.
Turning to our tax rate, our effective tax rate was 30% in Q3, which is higher than what we had experienced in prior years as a result of this quarter's performance reducing the net operating loss for the year.
Turning to our segments, PeopleReady, our largest segment, saw a 29% decline in revenue and segment profit was down 39%.
We saw nice intra-quarter revenue improvement with September down 27% compared to 32% in July with further improvement to a decline of 19% in October.
PeopleManagement saw an 8% decline in revenue and segment profit was up 35%.
PeopleManagement experienced encouraging intra-quarter revenue improvement with September down 2% compared to 12% in July.
Month-to-date for October, PeopleManagement was up 1%.
Turning to PeopleScout, we saw a 48% decline in revenue and segment profit was down 97%.
Intra-quarter revenue did show improvement with September down 40% compared to 52% in July.
As Patrick noted, PeopleScout results were adversely impacted by exposure to travel and leisure clients, which made up roughly 25% of the prior year mix and revenue for this vertical was down 74% year-over-year.
We also repurchased 9% of our common stock at favorable prices earlier this year to boost shareholder return.
Year-to-date cash flow from operations was $99 million as compared to $53 million for Q3 year-to-date last year with the increase coming from the deleveraging of accounts receivable.
In 2017, our total debt-to-capital was 18%; in 2018, 12%; in 2019, 6%; and as of Q3 this year, nearly zero.
For the fourth quarter of 2020, we expect gross margin contraction of 250 basis points to 190 basis points.
For the fourth quarter of 2020, we expect a year-over-year SG&A reduction of $23 million to $27 million, which would result in $102 million to $106 million of savings in 2020.
All-in, this would produce a decrease in SG&A expense of about 20% in 2020.
I'd also like to remind everyone that our business can generate an incremental operating margin of about 20% on incremental revenue which can of course run much higher with gross margin expansion or further SG&A declines.
For capital expenditures, we expect about $7 million for the fourth quarter of 2020, which is net of approximately $4 million of build out costs for our Chicago headquarters that are to be reimbursed by our landlord.
Our outlook for fully diluted weighted average shares outstanding for the fourth quarter of 2020 is 34.8 million.
Total benefits derived from this program were $11 million for fiscal 2019 and $6 million year-to-date in Q3 of this year.

Summary:
Total revenue for the third quarter was down 25% and we posted positive net income of $9 million or $0.25 per share.
Total revenue for Q3 2020 was $475 million representing a decline of 25%.
We posted net income of $9 million or $0.25 per share and adjusted net income of $8 million or $0.24 per share.