CBIZ Returned to Profit Growth After Second-Quarter Decline

The Tip Desk · October 21, 2026 · 3 min read

The professional services advisor reported third-quarter net income of $47.2 million, up 56.7% from a year earlier.

CBIZ, Inc. (CBZ), the national professional services advisor, reversed the previous quarter’s year-over-year profit decline, with its operating margin widening to 12.8% from 8.5% a year earlier. The improvement accompanied a return to revenue growth ahead of the company’s planned acquisition by an affiliate of Grant Thornton.

Revenue for the three months ended September 30 rose 1.2% to $702.2 million, following a 0.2% year-over-year decline in the second quarter. The modest sales increase accompanied a larger improvement in profitability: operating income reached $90.2 million, compared with $58.9 million a year earlier.

The earnings recovery also extended to adjusted results. Adjusted EBITDA rose 6.3% to $131.9 million after falling 14.3% year over year in the second quarter. Third-quarter adjusted diluted earnings were $1.21 a share, up 14.2%. The company’s adjusted measures excluded acquisition integration costs, amortization of acquired intangible assets and other specified items.

Acquisition integration costs fell to $17.3 million from $28.6 million a year earlier. The quarter also included $5.9 million of employee stock purchase plan correction income, which the company removed from adjusted earnings. Interest expense declined to $24.0 million from $28.0 million.

Deferred compensation accounting affected the size of the reported operating margin improvement. Excluding those income and expense movements, operating margin widened to 12.7% from 9.8% a year earlier. The company said the plan’s accounting entries offset one another and had no effect on pretax income or diluted earnings.

Financial Services, the larger operating segment, generated quarterly revenue of $597.8 million, up 1.2% from a year earlier. Its gross margin reached $109.9 million. The company had combined its National Practice group with Financial Services during the first nine months of the year and adjusted the comparable 2025 segment figures to match.

Benefits and Insurance Services reported quarterly revenue of $104.4 million, up 1.0%. Its profitability weakened, however, with adjusted EBITDA falling to $20.3 million from $21.8 million a year earlier.

The third-quarter recovery left the nine-month operating comparison below the prior year. For the nine months ended September 30, operating income was $308.8 million, against $319.2 million a year earlier, while adjusted EBITDA fell 1.2% to $479.3 million. Results for that nine-month period also included a $58.0 million gain from acquisition-related adjustments.

Cash generation improved over the nine months ended September 30. Operating cash flow totaled $147.1 million, compared with $48.8 million a year earlier, and free cash flow was $125.2 million. At September 30, cash and cash equivalents stood at $17.6 million, while gross term-loan and revolving-credit borrowings totaled $1.454 billion.

The pending takeover continued to govern the company’s outlook disclosures. CBIZ provided no full-year guidance and said it would not host a third-quarter earnings call, following its withdrawal of guidance in July. The proposed all-cash acquisition carried an enterprise value of $5.0 billion and offered shareholders $55.00 a share.

The company expects the transaction to close in the fourth quarter of 2026, subject to shareholder approval, required regulatory approvals and other customary conditions. CBIZ said completion would take the company private and end its New York Stock Exchange listing.