Insperity Announces First Quarter Results

About this update from Insperity, Inc.

HOUSTON, April 29, 2025 --( BUSINESS WIRE )-- Insperity, Inc. (NYSE: NSP), a leading provider of human resources and business performance solutions for America’s best businesses, today reported results for the first quarter ended March 31, 2025. Insperity will be hosting a conference call today at 8:30 a.m. ET to discuss these results and our updated 2025 outlook and will be posting an accompanying presentation to its investor website at http://ir.insperity.com . First Quarter Results The average number of worksite employees ("WSEE") paid per month increased 1% from Q1 2024 to 306,023 WSEEs. Revenues in Q1 2025 increased 3% to $1.9 billion on a 3% increase in revenue per WSEE on higher pricing and the increase in paid WSEEs. "Our first quarter financial results, reflecting macro-economic turbulence and healthcare cost volatility, are in stark contrast with the solid execution of our game plan for building the foundation for future growth acceleration," said Paul J. Sarvadi, Insperity chairman and chief executive officer. "We also made excellent progress on our Workday strategic partnership milestones, including an agreed upon go-to-market plan that we expect will add a new driver to our growth in 2026 and beyond." Gross profit decreased 10% to $310 million in Q1 2025 from $345 million in Q1 2024 due primarily to higher-than-expected benefits costs. Other areas of gross profit, including pricing, workers’ compensation program and payroll taxes were in line with our expectations. Higher Q1 2025 healthcare costs were driven by an acceleration in inpatient, outpatient, and pharmacy costs and in the frequency of large claim activity. Healthcare costs include approximately $12 million of higher-than-expected runoff from claims related to prior periods. Operating expenses increased 2% to $242 million in Q1 2025 from $237 million in Q1 2024. Operating expenses included $13 million and $5 million for our Workday strategic partnership in Q1 2025 and Q1 2024, respectively. Reported net income and diluted EPS were $51 million and $1.35, respectively. Adjusted EBITDA and adjusted EPS were $102 million and $1.57, respectively. "We have made good progress with our operating plan in 2025, with a focus on operating expense management and accelerating growth," said James D. Allison, executive vice president of finance, chief financial officer and treasurer. "Given the elevated level of healthcare costs in the quarter, we have initiated a pricing plan to address the projected higher healthcare cost trend. We also have other options under evaluation that could contain or reduce costs and drive improved profitability in 2026." Cash outlays in the first three months of 2025 included the repurchase of approximately 224,000 shares of our common stock at a cost of $19 million, dividends totaling $23 million, and capital expenditures of $6 million. Adjusted cash at March 31, 2025 totaled $124 million and $280 million remains available under our $650 million credit facility. 2025 Guidance The company also announced its updated guidance for 2025, including the second quarter of 2025. Please refer to the accompanying financial tables at the end of this press release for the reconciliation of non-GAAP financial measures to the comparable GAAP financial measures. Definition of Key Metrics Average WSEEs paid — Determined by calculating the company’s cumulative WSEEs paid during the period divided by the number of months in the period. Adjusted EPS — Represents diluted net income per share computed in accordance with GAAP, excluding the impact of non-cash stock-based compensation. Adjusted EBITDA — Represents net income computed in accordance with GAAP, plus interest expense, income taxes, depreciation and amortization expense, amortization of SaaS implementation costs and non-cash stock-based compensation. Conference Call and Webcast Insperity will be hosting a conference call today at 8:30 a.m. ET to discuss these results and the guidance discussed in this press release, and answer questions from investment analysts. To listen in, call 888-506-0062 and use conference i.d. number 634912. The call will also be webcast at http://ir.insperity.com . The conference call script will be available at the same website later today. A replay of the conference call will be available at 877-481-4010, conference i.d. number 52321. The webcast will be archived for one year. About Insperity Since 1986, Insperity’s mission has been to help businesses succeed so communities prosper. Offering the most comprehensive suite of scalable HR solutions available in the marketplace, Insperity is defined by an unrivaled breadth and depth of services and level of care. Through an optimal blend of premium HR service and technology, Insperity delivers the administrative relief, reduced liabilities and better benefit solutions that businesses need for sustained growth. With 2024 revenues of $6.6 billion and more than 100 sales offices throughout the U.S., Insperity is currently making a difference in thousands of businesses and communities nationwide. For more information, visit http://www.insperity.com . Forward-Looking Statements The statements contained herein that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. You can identify such forward-looking statements by the words "anticipates," "expects," "intends," "plans," "projects," "believes," "estimates," "forecasts," "likely," "possibly," "probably," "could," "goal," "opportunity," "objective," "target," "assume," "outlook," "guidance," "predicts," "appears," "indicator" and similar expressions. Forward-looking statements involve a number of risks and uncertainties. In the normal course of business, in an effort to help keep our stockholders and the public informed about our operations, from time to time, we may issue such forward-looking statements, either orally or in writing. Generally, these statements relate to business plans or strategies, including our strategic partnership with Workday, Inc.; projected or anticipated benefits or other consequences of such plans or strategies; or projections involving anticipated revenues, earnings, average number of worksite employees, benefits and workers’ compensation costs, or other operating results. We base these forward-looking statements on our current expectations, estimates and projections. We caution you that these statements are not guarantees of future performance and involve risks, uncertainties and assumptions that we cannot predict. In addition, we have based many of these forward-looking statements on assumptions about future events that may prove to be inaccurate. Therefore, the actual results of the future events described in such forward-looking statements could differ materially from those stated in such forward-looking statements. Among the factors that could cause actual results to differ materially are: These factors are discussed in further detail in Insperity’s filings with the U.S. Securities and Exchange Commission. Any of these factors, or a combination of such factors, could materially affect the results of our operations and whether forward-looking statements we make ultimately prove to be accurate. Any forward-looking statements are made only as of the date hereof and, unless otherwise required by applicable securities laws, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.   View source version on businesswire.com: https://www.businesswire.com/news/home/20250429726454/en/ Contacts Investor Relations Contact: James D. Allison Executive Vice President of Finance, Chief Financial Officer and Treasurer 281-348-3140 [email protected] News Media Contact: Cynthia Murga Director, Public Relations 713-324-1414 [email protected]

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