A version of this article originally appeared in Quartz’s Leadership newsletter. Sign up here to get the latest leadership news and insights straight to your inbox. We often associate job promotions with bold confidence and huge deliverables. But when promotions happen, the story is rarely so dramatic. Careers are upgraded quietly, long before title changes are announced on LinkedIn. How are we going to manifest career advancement in 2026? By committing to routine, often undesirable, frequently boring ...

Core Insights - Palm Valley Capital Fund reported a 2.35% appreciation in Q3 2025, underperforming the S&P SmallCap 600's 9.11% gain and the Morningstar Small Cap Total Return Index's 7.99% rise [1] - The Fund's cash equivalents increased from 73.5% to 74.1% during the quarter, indicating a cautious investment strategy [1] - Small-cap stocks outperformed large caps due to expectations of Federal Reserve easing and reduced tariff concerns [1] Company Analysis: Robert Half Inc. (NYSE:RHI) - Robert Half Inc. experienced a one-month return of -5.28% and a 52-week loss of 50.64%, closing at $33.16 with a market capitalization of $3.374 billion on October 7, 2025 [2] - The company specializes in staffing and consulting services, particularly in finance and accounting, but has faced challenges due to a weak staffing industry disconnected from the broader labor market post-COVID [3] - Concerns exist regarding the ongoing demand for finance staffing amid potential job displacement by AI technologies [3] Hedge Fund Interest - Robert Half Inc. was held by 34 hedge fund portfolios at the end of Q2 2025, an increase from 27 in the previous quarter [4] - The company reported enterprise revenue of $1.37 billion in Q2 2025, a 7% decline from Q2 2024 [4] - While Robert Half Inc. has investment potential, certain AI stocks are viewed as offering greater upside with less downside risk [4]

Financial Data and Key Metrics Changes - Total revenues for the second quarter were $334.3 million, a decline of 6.2% year over year, consistent with expectations [12] - Earnings per share for the quarter were $0.59, aligning with expectations [21] - Overall gross margins increased by 40 basis points sequentially to 27.1%, driven by an increase in Flex margins [21] - Operating margin for the second quarter was 4.5%, with an effective tax rate of 24.6%, slightly lower than expected due to favorable adjustments [23][24] Business Line Data and Key Metrics Changes - Flex revenues in technology and finance and accounting businesses improved slightly sequentially in Q2, while Direct Hire revenues faced challenges [12] - Flex revenues in the finance and accounting business, which represent about 6% of total revenues, declined 16.8% year over year but saw sequential growth for the first time in years [18] - Average bill rate in the technology business remained stable at approximately $90, while the finance and accounting average bill rate improved to about $54 [14][18] Market Data and Key Metrics Changes - The company operates in a demand-constrained environment, with clients maintaining significant backlogs of technology investments [4][5] - Job gains have been concentrated in sectors like healthcare, leisure, hospitality, and construction, while job creation outside these sectors has been minimal [5] - The demand for consulting-led offerings remains strong, contributing to overall technology top-line outperformance [13] Company Strategy and Development Direction - The company is focused on organic growth strategies and investing in consulting-oriented solutions to meet client needs [10][12] - There is a strategic shift towards providing flexible talent solutions as companies assess macroeconomic conditions [6][9] - The company aims to leverage AI and other innovative technologies to enhance business operations and client offerings [6][9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the stability of the technology business and the potential for growth in AI-related services [9][20] - The company anticipates a modest sequential decline in technology business revenues in Q3 due to unexpected project ends [17] - Management highlighted the importance of retaining productive associates and making targeted investments to capitalize on future market demand [19][20] Other Important Information - The company has returned approximately $1 billion in capital to shareholders since 2007, representing about 75% of cash generated [26] - The company expects Q3 revenues to be in the range of $324 million to $332 million, with earnings per share between $0.53 and $0.61 [26] Q&A Session Summary Question: Can you discuss the levels of discussion regarding AI and when the company expects to assist clients more significantly? - Management noted that most organizations are still in the preparation phase for AI, focusing on foundational readiness aspects [30][31] Question: What is the nature of the unexpected project ends mentioned? - Management clarified that these project ends were due to clients reallocating technology investments rather than budget cuts [36][37] Question: How is the pipeline looking currently? - Management indicated that the pipeline remains strong, with pent-up demand for legacy projects and increased interest in data and AI preparation [38][39] Question: Is there a common thread among the project ends impacting trends? - Management stated that the project ends were largely due to strategic reallocations of technology investments by clients [77][80] Question: What impact does the nearshore/offshore dynamic have on margins? - Management confirmed that while the nearshore/offshore business is small, it has been slightly accretive to margins [81]

Financial Data and Key Metrics Changes - Total revenues for Q1 2025 were $63.2 million, down 8% from the prior year, with professional services down 4.2% and property management down 14.9% [6][13] - Adjusted EBITDA was $2.4 million with an EBITDA margin of 3.8%, showing improvement from $1.4 million or 2.2% in the previous quarter [15] - Adjusted EPS was $0.05 per share, while the GAAP loss was $0.07 per diluted share [15] Business Line Data and Key Metrics Changes - Professional segment revenues increased sequentially by 5.6% compared to the previous quarter, despite a year-over-year decline of 4.2% [6][13] - Property management revenues declined over 14% on both a sequential and year-over-year basis, but there are signs of improvement with revenues per billing day increasing [14][10] Market Data and Key Metrics Changes - The U.S. apartment rental rates are starting to elevate again, which is expected to improve the economics for property management companies [11] - The company signed 23 new logos in Q1 2025, up over 60% from 14 in Q1 2024, indicating positive momentum [10] Company Strategy and Development Direction - The company is focused on strategic alternatives and restructuring initiatives to recalibrate costs and improve efficiency [5] - There is a commitment to growth initiatives and managing controllable factors amidst macroeconomic uncertainties [19] - The company aims to leverage prior investments in technology and processes to drive long-term shareholder value [19] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding consulting projects and business spending, despite uncertainties in trade policies [7][18] - The labor market remains solid, with job additions indicating potential for future growth [19] - Management is optimistic about the property management segment as rental rates improve, but acknowledges ongoing challenges [12][11] Other Important Information - The company entered into waivers and amendments with lenders due to non-compliance with financial covenants at the end of 2024 [16] - The company is continuously looking for ways to improve cost effectiveness and operational efficiency [28] Q&A Session Summary Question: Could you provide context around the new logos and average deal size? - Management indicated that several contracts were signed in March, and they would follow up with specific data [22][23] Question: Are there discussions regarding pent-up demand due to tariff uncertainties? - Management believes there is pent-up demand, but clients are currently in a cautious "wait and see" mode [24][25] Question: Is the technology platform fully rolled out? - The technology platform is fully rolled out, with ongoing improvements being made to enhance efficiency [26][27] Question: How much of the expense reductions were factored into Q1 results? - Approximately 65% to 70% of the expense reductions were realized in Q1, with full benefits expected in Q2 [28] Question: What is the competitive dynamic within property management? - The competitive environment remains stable, and the company continues to secure preferred partner agreements [29][30] Question: When might property management return to year-over-year stability? - Management is working towards regaining growth trajectory and is seeing positive signs [31] Question: How comfortable is management with street estimates? - Management beat estimates for Q1 but has not yet reviewed Q2 estimates [37] Question: How does the company reconcile the cautious mindset of customers with the increase in new logos? - It varies by sector, with some sectors showing movement while others remain cautious [44] Question: Is there a shift in professional services performance? - Professional segment revenues increased in Q1 compared to Q4, indicating a positive trend [46][47] Question: What is the historical behavior in spending post-recession? - Historically, the industry rebounds quickly, but current conditions are unique, with cautious spending observed [54]