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HireQuest's Third Quarter 2026 Financial Performance

Overview
On November 12, 2026, HireQuest (NASDAQ: HQI), a prominent name in staffing solutions and direct-hire recruiting, disclosed its financial outcomes for the third quarter ended September 30, 2026. The company demonstrates a persistent upward trajectory in revenue as it capitalizes on the robust demand for staffing services across its national network.

CEO Comments
Rick Hermanns, the President and CEO of HireQuest, expressed optimism in the face of challenges, stating, "Our third quarter results reflect continued momentum across our core commercial staffing brands, as improving demand delivered another quarter of year-over-year revenue growth. Our franchise model continues to demonstrate its resilience, allowing us to grow alongside our franchisees as they benefit from a strengthened labor market."

Financial Highlights

• - Franchise Royalties: For Q3 2026, franchise royalties amounted to $8.2 million, which marks a 1.5% increase from $8.1 million during the same period last year. Furthermore, when accounting for previous asset divestitures, this increase jumps to 7.9%.
• - Service Revenue: The company reported service revenue of $604,000, significantly up from $387,000 in the prior-year quarter.
• - Total Revenue: HireQuest's total revenue for Q3 was $8.8 million, reflecting a 4.0% rise from $8.5 million in Q3 2025. Again, the pro forma increase, excluding specific asset divestitures, reveals an 11.1% growth.

Expenses and Net Income
Selling, general, and administrative (SGA) expenses escalated to $6.1 million, up from $5.1 million, marking a 20.7% rise, which encompassed a $1.3 million write-down of notes receivable attributed primarily to a franchised location repossession. The net income for the quarter stood at $1.7 million or $0.12 per diluted share, down from $2.3 million or $0.16 per diluted share in Q3 of the prior year. This drop is largely ascribed to the aforementioned write-downs and heightened worker’s compensation costs.

Year-To-Date Review
Throughout the first nine months of 2026, franchise royalties totaled $21.8 million, reflecting a slight decline from $22.3 million in the equivalent timeframe the previous year. However, service revenue improved to $1.6 million from $1.3 million. When including adjusted figures that remove the impact of asset divestitures, total revenue showed an upsurge of 7.8% for the nine-month period, emphasizing the company’s growth trajectory post-adjustments.

Capital Structure and Financial Outlook
As of September 30, 2026, HireQuest maintained a robust balance sheet with total assets amounting to $95.7 million. Cash reserves stood at $1.1 million, declining from $3.9 million at the end of 2025, indicating strategic investments and operational expenditures. Despite these fluctuations, the firm’s determination for judicious capital allocation remains steadfast, aspiring to bolster shareholder value consistently moving forward.

Future Directions
With an optimistic outlook, Hermanns commented on HireQuest's future, anticipating a continuously improving demand environment as 2026 progresses. The company is committed to executing disciplined capital allocation strategies to enhance profitability and shareholder returns. A scheduled conference call will address these financial results, allowing further insights into their growth strategies and operational endeavors.

Conference Call Information
The earnings call will take place on Thursday, November 12, 2026, at 4:30 PM Eastern Time and will be accessible to the public for both live broadcast and subsequent replay via their official website. Join us to gain detailed insights into HireQuest's performance and future growth strategies.

Conclusion
In summary, HireQuest’s financial results for the third quarter of 2026 showcase their resilience amidst market fluctuations, confirming the effectiveness of their franchise model and the ongoing demand for staffing solutions across their operational footprint.