Financial Data and Key Metrics Changes - Revenue for Q1 2026 was reported at $120.2 million, exceeding the high end of the outlook range, with a gross margin of 39.5%, which is 300 basis points higher than the prior year quarter [25][26] - SG&A expenses were $44.5 million, a 7% improvement from $47.7 million a year ago, primarily due to lower management compensation and reductions in other G&A expenses [27][28] - Adjusted EBITDA improved to $3.1 million, representing a 2.5% adjusted EBITDA margin [25] Business Line Data and Key Metrics Changes - Revenue from the on-demand segment was $44.4 million, a decline of 16% year-over-year, but segment-adjusted EBITDA improved to $4.4 million, or a margin of 10% [29] - Consulting segment revenue was $43.6 million, down 22% from the prior year, with segment-adjusted EBITDA at $5 million, or an 11.6% margin [29] - Europe and Asia-Pacific segment revenue grew by 5% year-over-year to $19.9 million, with segment-adjusted EBITDA of $0.8 million, or a 4.2% margin [30] Market Data and Key Metrics Changes - The company reported solid growth in Europe and Asia-Pacific, driven by strong client relationships and effective regional strategies [22][23] - Demand for CFO advisory and digital transformation offerings remains strong, with a focus on combining local delivery with scalable global delivery centers [23] Company Strategy and Development Direction - The company is transforming from a professional staffing organization to a diversified platform that combines on-demand talent with consulting and outsourced services [5][12] - Focus areas include CFO advisory and digital transformation, which are critical for driving client transformation from strategy to execution [5][8] - The company aims to increase its addressable market and improve return for shareholders through enhanced value creation and strategic investments [4][12] Management's Comments on Operating Environment and Future Outlook - Management noted that the global macro environment remains uncertain, but they are positioning the company for an upturn [3] - The pipeline returned to growth during the quarter, with demand strengthening across CFO advisory and digital transformation [16] - Management expects continued revenue stability in Q2, with a revenue outlook of $115 to $120 million [31][32] Other Important Information - The company has a strong balance sheet with $77.5 million in cash and cash equivalents and no outstanding debt [30] - A reduction in force was implemented to streamline the organizational structure, expected to yield annual cost savings of $6 to $8 million [28] Q&A Session Summary Question: What is the trend in pricing? - Management indicated that while staffing rates have remained steady, there are pricing pressures in consulting, though value-added services are allowing for rate increases on new projects [36] Question: How much of the pipeline is attributed to cross-selling? - The company is still building its pipeline, but there is an increase in $1 million-plus deals, indicating positive momentum in cross-selling efforts [38] Question: Can you break down the revenue guide between segments? - The revenue guide for Q2 indicates continued strength in Europe and Asia-Pacific, while on-demand and consulting segments are expected to perform similarly to Q1 [40][41] Question: What is the general appetite for spending among clients? - Management noted that the environment remains choppy, with some interesting work progressing, but overall client spending appetite has not changed significantly [50][51]