On February 10, 2025, Insperity Inc (NSP, Financial) released its 8-K filing detailing the financial results for the fourth quarter and full year ending December 31, 2024. Insperity Inc, a prominent provider of human resources and business solutions, primarily serves small and midsize enterprises in the United States through its Workforce Optimization and Workforce Synchronization solutions.
Performance Overview and Challenges
Insperity Inc reported a net loss of $9 million for the fourth quarter of 2024, translating to a diluted EPS of $(0.22), which fell short of the analyst estimate of $(0.21). The adjusted EPS for the quarter was $0.05. The company's revenue for the quarter was $1.6 billion, slightly below the estimated $1,596.93 million. For the full year, Insperity achieved a net income of $91 million and a diluted EPS of $2.42, narrowly surpassing the annual estimate of $2.41. The revenue for the year was $6.6 billion, aligning with the estimated $6,564.93 million.
Financial Achievements and Industry Context
Despite the challenges, Insperity Inc managed to increase its revenue by 1% year-over-year to $6.6 billion, driven by a 3% increase in revenue per worksite employee (WSEE). The company also returned $152 million to shareholders through share repurchases and dividends, highlighting its commitment to shareholder value. These achievements are significant in the business services industry, where maintaining client retention and managing costs are crucial for sustained growth.
Income Statement and Balance Sheet Highlights
The average number of WSEEs paid per month decreased by 2% from the previous year to 307,261. Operating expenses rose by 14% due to investments in strategic partnerships and inflationary pressures. The company's gross profit increased by 1% to $1,052 million, while operating income declined by 47% to $117 million. The balance sheet showed total assets of $2,597 million, with cash and cash equivalents increasing to $1,039 million from $693 million in 2023.
We are pleased with our 2024 financial results, particularly considering the macroeconomic conditions that impacted our growth," said James D. Allison, executive vice president of finance, chief financial officer and treasurer.
Cash Flow and Strategic Investments
Insperity's cash flow from operations supported significant shareholder returns and strategic investments. The company repurchased 697,000 shares for $63 million and paid $89 million in dividends. Capital expenditures amounted to $38 million, reflecting ongoing investments in technology and service enhancements.
Analysis and Future Outlook
Insperity Inc's performance in 2024 reflects both the challenges and opportunities within the human resources services sector. The company's strategic focus on enhancing its growth trajectory through partnerships, such as with Workday, positions it for potential future gains. However, the increase in operating expenses and the slight decline in WSEE numbers indicate areas that require attention to sustain profitability and growth.
| Metric | Q4 2024 | Full Year 2024 |
|---|---|---|
| Net Income (Loss) | $(9) million | $91 million |
| Diluted EPS | $(0.22) | $2.42 |
| Revenue | $1.6 billion | $6.6 billion |
| Adjusted EBITDA | $23 million | $270 million |
For more detailed insights and future guidance, investors are encouraged to review the full 8-K filing and participate in the company's conference call.
Explore the complete 8-K earnings release (here) from Insperity Inc for further details.
