ManpowerGroup Inc. Q4 FY2025 earnings call

• Fourth quarter marked shift to stabilization led by enterprise demand and cost optimization. - Diversified multi-brand portfolio performs well, Manpower addresses AI-resilient skills, Experis sees rate of decline narrowing, Talent Solutions saw growth. - Priorities: execute with rigor, maintain cost discipline, leverage digitization advantage. - Cost discipline: 4% constant currency reduction in SG&A in Q4, ongoing cost actions. - Becky Frankiewicz discussed macro themes of flexibility and AI shaping workforce composition, engagement with experts and clients. - Jonas Prising talked about PowerSuite operating system, scaled AI recruiter toolkit improving productivity and placement rates.

In the fourth quarter, reported revenues were $4.7 billion with organic constant currency growth of 2%, system-wide revenue was $5.1 billion. Adjusted EBITDA margin was 2.1%. Manpower brand had 5% organic constant currency growth in the quarter, Experis brand declined by 6%, Talent Solutions brand declined by 4%. Americas segment: Americas comprised 24% of consolidated revenue, US revenue was $682 million with Manpower brand up 7% days adjusted, Experis US revenue down 10% days adjusted, Talent Solutions US revenue up 2% year over year. Southern Europe: Comprised 48% of consolidated revenue, flipped to 1% growth in constant currency in Q4, France revenue down 3% days adjusted constant currency, Italy revenue up 7% days adjusted constant currency. Northern Europe: Comprised 17% of consolidated revenue, 1% decline in constant currency, UK revenues down 3% days adjusted currency. Asia Pacific Middle East: Comprised 11% of total company revenue, revenues up 6% in organic constant currency.

• Forecast anticipates continuation of existing trends. - First quarter earnings per share range $0.45 to $0.55, includes favorable foreign currency impact of $0.06 per share. - Constant currency revenue guidance range between 1% decrease and 3% increase, midpoint 1% increase. - EBITDA margin for first quarter projected up 10 basis points at midpoint compared to prior year. - 2026 tax guidance incorporates corporate tax surcharge extension in France, US WOTC not renewed yet, estimate full-year global tax rate 45% with possible reduction if WOTC enacted.

• Q: Mark Marcon asked about productivity, margin aspirations with moderate recovery.

A: Jonas and Jack discussed PowerSuite implementation, centralization, standardization driving cost efficiency, aiming for 4.5% to 5% EBITDA margin. - Q: Andrew Steinerman asked about sustainable organic revenue growth and flexibility thesis.

A: Jonas and Becky discussed controlling what can be controlled, driving growth and productivity, clients and candidates wanting flexibility. - Q: Kartik Mehta asked about enterprise demand impact on margins and cash conversion.

A: Jack talked about enterprise demand mix impact on GP margin, DSO tick up, actions to mitigate. - Q: Trevor Romeo asked about near-term demand progress in key markets.

A: Jack provided color on progress in France, US, Italy in Q4 and January. - Q: Jeff Silber asked about workforce expansion and technology.

A: Jonas said expanding in demand-driving roles in some countries, leveraging PowerSuite for productivity. - Q: Ronan Kennedy asked about leading indicators for broad-based recovery and labor market characterization.

A: Jonas talked about client conversations, industry sector moves, labor market stabilizing. - Q: Josh Chan asked about SG&A leverage and gross margin.

A: Jack said SG&A down 4% in Q4, GP margin impacted by enterprise element and perm being low. - Q: Andrew Grobler asked about IT sector in US.

A: Becky said sequential improvements in Experis, clients focused on AI projects. - Q: Tobey Sommer asked about 4.5% EBITDA margin goal.

A: Jack talked about mix of businesses, GP margin improvement, cost structure work. - Q: Harold Anter asked about AI impact on blue-collar vs white-collar, clients using AI, pricing.

A: Becky and Jonas discussed AI impact on different roles, SoFi.ai ecosystem, higher value offerings with AI.