ManpowerGroup's Experis U.S. Crosses Back Into Growth
Third-quarter revenue was $4.8 billion, up 4% as reported and 6% organic constant currency, as the company guided fourth-quarter EPS of $1.03 to $1.13.
ManpowerGroup (MAN), the global workforce solutions company, reported third-quarter revenue of $4.8 billion, up 4% as reported, 5% in constant currency and 6% organic constant currency, a slower pace than the 8% reported increase in the second quarter.
The inflection the company highlighted was in Experis. Organic constant-currency Experis revenue was flat year over year, improved from a 2% decline in the prior quarter, and U.S. Experis crossed over to growth during the period. Manpower organic constant-currency revenue rose 7% year over year, closely aligned with 8% growth in the second quarter. Talent Solutions organic constant-currency revenue improved to 1% growth from flat in the second quarter, driven by RPO and MSP and partially offset by a decline in Right Management on lower outplacement activity.
Net earnings were $34.1 million, or $0.71 a share, versus $18.0 million, or $0.38 a share, a year earlier. The quarter included restructuring costs, strategic transformation program costs, a business-sale adjustment and Argentina hyperinflationary non-cash currency translation losses that reduced earnings per share by $0.30. Excluding those items, earnings were $1.01 a share, up 24% in constant currency.
Gross profit was $767.3 million, down 0.2% as reported and 0.4% in constant currency, with gross margin at 15.9% as reported. Selling and administrative expenses fell 2.5% as reported and 2.0% in constant currency. Operating profit rose 23.7% as reported and 26.2% in constant currency to $82.3 million from $66.6 million a year earlier.
Americas revenue rose 13.5% as reported and 11.5% in constant currency to $1.25 billion. Other Americas was up 27.0% as reported and 21.7% in constant currency; the United States was up 5.5%. Americas operating unit profit rose 25.0% as reported and 22.6% in constant currency to $47.4 million.
Southern Europe revenue rose 1.0% as reported and 2.1% in constant currency to $2.23 billion. France was down 3.5% as reported and 1.9% in constant currency; Italy was up 4.5% and Other Southern Europe up 7.5%. Southern Europe operating unit profit was $64.6 million, down 1.7% as reported. France operating unit profit fell 26.9% and Other Southern Europe operating unit profit rose 74.1%.
Northern Europe revenue rose 5.4% as reported and 5.9% in constant currency to $860.6 million. Operating unit profit swung to a $7.5 million profit from a $14.9 million loss a year earlier. APME revenue fell 1.1% as reported and 4.3% in constant currency to $514.9 million. APME operating unit profit declined 10.2% as reported and 3.7% in constant currency to $23.9 million.
Chair and CEO Jonas Prising said the Manpower brand continued to lead, with notable share gains in the United States, and that Experis and Talent Solutions experienced sequential revenue trend improvement. He said the company is remaining on track to deliver on its cost-savings target. The company said the global strategic transformation program is progressing as planned, expanding to the United Kingdom in the third quarter, and that it remains on track to deliver a $200 million cost-savings target in 2028.
Becky Frankiewicz will become chief executive on January 1, 2027, with Prising transitioning to executive chair.
ManpowerGroup anticipates diluted earnings per share in the fourth quarter of $1.03 to $1.13 and a 44% effective tax rate. Revenue is expected up 3-7% as reported and 4-8% organic constant currency. Americas is expected up 7-11%, Southern Europe flat to up 4%, Northern Europe up 8-12% and APME up 1-5%. Gross profit margin is expected at 15.8% to 16.0% and operating profit margin at 2.1% to 2.3%. Estimates assume FX rates of 1.15 for the euro, 1.34 for the pound, 0.0064 for the yen and 0.0007 for the Argentine peso.