Earnings call transcript Q2 2023

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Operator

Welcome to ManpowerGroup's Second Quarter Earnings Results Conference Call. [Operator Instructions] This call is being recorded.

If you care to drop-off now, please do so.

I would now like to turn the call over to ManpowerGroup's Chairman and CEO, Jonas Prising. Sir, you may begin.

Jonas Prising

quarter for second the to conference XXXX. call Welcome

McGinnis, me today. Chief Financial with Jack Officer, Our is

For we at Investor Relations your within section remarks convenience, of have included our website manpowergroup.com. prepared our the

we through will I will quarter, Jack concluding then third and share go will quarter of results before highlights the quarter for of some then second some start through guidance start session. the the of our going Q&A by the XXXX. thoughts I

cover now the language. Safe will Jack Harbor And

Jack McGinnis

forward-looking risks includes or geopolitical based forward-looking to obligation call statements. including These conference statements subject materially and revise This everyone. or current beliefs. update morning, are economic statements, uncertainty differ forward-looking might We to from concerning Good assume expectations statements results management's statements. any on known and those no are Actual the which projected and unknown uncertainties. in

further our non-GAAP to statements factors may cause presentation Slide our call information X reconciliation in release and and results identifies of this materially regarding that forward-looking actual earnings made measures. differ of

Jonas Prising

Thanks, events innovation just the our and year, for our VivaTech, seventh technology included expertise world's workforce lab. we largest through one start-up trips Jack. the Europe New back Paris, a key Human of where showcasing were partner I'm in Age and in which from

The hot AI and topic. advancement skills and a of Generative jobs was the on impact

jobs. the the and see speed and that the biggest create Forum. challenge companies a by the seen Economic jobs; impact human capital discussed Our that digitize at on panel World what never roles new us the tech will and our elimination jobs skillsets ago media then - is will to the it of most before. progress experience be reflect of be tell the need workforce automation biggest the at now ten interviews accelerate scale we first data me augmented and that won't productivity as led almost improvements And for and years most And automate

environment markets, in broader economic pressures labor around signs to markets - unemployment see although resilience we labor world markets are global many and of demonstrate some low on Reflecting the continued continue emerging. economic with

hiring U.S companies As we particular the headcounts. Large I mentioned across and tech seeing in impacts quarter, began the continued with Europe. A certain in to sectors substantially in enterprise trends are XXXX. board that have trend late reduce last slower

We are in demand production to some also softer tracking commercial staffing manufacturing activities. decreased due

of uneven high to ManpowerGroup purchasing consumer often labor for and measured confidence spring of amid employers the more recent lag most in plus and industry plan our they found Employment constraints Our supply cautious XX first. QX Outlook economic hiring Survey priorities impact from countries macro trends conducted continued points market shifting local companies employer challenges other the that and inflation. data Many a range as XX,XXX navigate in

weakened environment, mixed APME Europe. this same in and continue services. And and and staffing demand our ongoing time, LATAM for we for the At permanent in demand to recruitment services saw growth in for U.S. see demand with we the

constant currency. to second in X% $X.X in was down the on revenue Moving billion, results, year-over-year financial quarter our

and in per on XX% year-over-year. currency Earnings foreign for $XXX Reported EBITDA was per a was an hyperinflationary share year-over-year EBITDA and decrease reported $X.XX basis restructuring a exchange margin reported EBITDA down on constant X.X% Our Adjusting in EBITDA and basis. the million, for X.X%. were $XXX was quarter adjusted currency. adjusted was diluted margin share million. constant was charges, earnings XX% representing Argentina $X.XX Adjusted

they struggled will in-demand be on success, of Capital conversations focused our skill with last talent clients continue my couple many employers Corporate is recruit driver of Human and continue a it clear holding to Although and persist, to teams uncertainty is in and on in sets countries, specific that be with people from may with to to the key the years. that

geographies meet to have our progress demand our diversifying by and brands, offerings business across The this serve made us continue will we to well.

provide Our scarce progress our clients competitive looking as skills in strength creating Experis initiatives MyPath talent for our need. Academy the we at scale create talent are they through in and the

I will now turn Jack results. through you it the take over to to

Jack McGinnis

Revenues in came activity. range Jonas. in Thanks, margin guidance permanent our recruitment to our quarter profit at the the guidance of Gross second midpoint due in below currency lower range. came constant just

currency As representing period. compared was decrease year EBITDA to adjusted prior million, XX% a the constant $XXX in

adjusted was low-end decline at of X.X% of XXX our points range, in margin EBITDA the and year-over-year. basis As guidance came representing

had movements foreign results. currency our on quarter, the During a modest impact year-over-year

percent currency the line about for our trend. negative rates, dollar the guidance. with drove revenue decreased Organic exchange foreign impact X%. constant decreased in currency quarter and trend revenue Foreign constant reported related revenue X% one After of days-adjusted our adjusting U.S. translation in swing the between the currency

related Turning to related currency charges $X.XX hyperinflationary translation earnings to our business. the non-cash EPS Argentina and included X, which $X.XX to was restructuring on of bridge slide per reported foreign our share

be quarter. Argentina of their a the reflect noncash currency. to charge as accounting operates non-cash the This translation devaluation Argentina is is required losses local currency peso business and Argentine our a hyperinflationary economy treated in the as during the

impact and a worse of rate a of that our which repurchases $X.XX performance Excluding to softer which share average a $X.XX had $X.XX. results impact a positive tax mid-point, a was cents, which and foreign these operational positive share had other weighted guidance $X.XX EPS impact $X.XX, our quarter guidance charges, from the adjusted our currency had expenses lower negative than $X.XX, was a due lower in count interest of a effective Walking included impact.

decline enterprise pull-back convenience represented year. and much with having on and review by Experis reported prior growth activity brand the the our lower segments revenue revenue of significant in the declined by compared organic decline XX% Year-over-year, brand a both X%, Talent more The revenue from X%. constant Manpower a customer Experis clients an enterprise declined business line. pronounced currency brand to by let's Solutions Next, basis, the

significant year anniversaried decline as our Talent revenue RPO we across a in we levels year-over-year in Within high permanent period. of saw the hiring markets key Solutions prior

reduced declines year growth saw the compared of quarter margin in higher revenue Management record-low business while Our Right period. certain significant to activity activity, quarter in the on the as prior the we in MSP outplacement levels revenue volumes experienced lower

the Looking recruitment, reduction record than gross decrease the RPO, expected as basis slight at margin. contributed related year profit the result. margin our in than contributed slightly margin very The XX.X%. in recruitment gross Manpower our in guidance was which the point reduction activity gross a Talent detail, period. prior in permanent at quarter permanent point XX lower came experienced staffing greater Solutions hiring mix drove GP XX experienced in Permanent margin the including Staffing basis from during margin reduced high a levels demand margin reduction as

basis Right resulted Management significantly. XX transition in increased a activity Other within margin career Solutions as improvement contributed Talent items outplacement decrease. basis XX points point of

profit professional onto our Solutions of comprised XX%. business XX% Moving business Experis XX% gross brand our during and line; the gross Talent by [ph] quarter, profit, Manpower the comprised comprised

During decreased the profit quarter, constant basis our organic consolidated X% currency an gross year-over-year. on

in profit organic decrease reported brand year-over-year. currency constant X% an Manpower gross of Our

drove in our in RPO by the year-over-year. the year-over-year. gross currency decreased constant currency Experis profit profit Experis recruitment gross Talent constant within brand. for decreases Permanent decreased Organic in we This decrease a overall quarter. the during Right experienced Profit by in was declines in partially as XX% hiring and X% in Organic period, the driven GP significant Management Solutions MSP, offset higher in during rate of double-digit in MSP the in the in quarter. slight of year record-levels decreased while percentage prior growth permanent Gross range RPO quarter anniversary decline the GP activity brand

Reported quarter was SG&A expense million. the in $XXX

million. invest Excluding the this growth growth opportunities, incremental the digitization of restructuring same balance constant of reductions including initiatives basis. Talent quarter skills This related $X slowing of $X of on net Solutions to demand, organic by an costs first currency offset million, SG&A while specialty a consisted well continue increases areas basis, and notably costs The Experis, on changes down we in $X costs, as in Manpower. strategic cost in of operational underlying year-over-year was from of in acquisitions most flat reflects X% million, to currency as

X% revenue. of $XX was second constant the costs the Revenue of $XX.X in year operational decrease as on segment $X.X period compared OUP revenue the million Restructuring constant totaled comprised XX.X% expenses a the representing revenue billion, SG&A to lowered a includes decline. quarter in leverage XX% was Adjusted Americas on of The in a represented $X restructuring million. percentage costs. Reported reflecting prior quarter of currency basis. million currency consolidated and

XX% U.S. days-adjusted As year. segment, was representing The the during compared comprising was the the revenues. margin to Revenue quarter an the OUP was $XXX country in of segment XX% adjusted, million $XX and U.S. the Americas in is OUP largest million prior decrease X.X%.

U.S. costs, the from in quarter business to was $XX our XX% prior adjusted OUP of As year. restructuring exclude a million the decrease for representing

adjusted, As margin OUP was X.X%.

the U.S., the brand in Manpower the during XX% the quarter. representing profit decreased further The the of U.S. the the brand comprised first quarter. decline to from rate gross Manpower during days-adjusted in basis XX% for on the to Manufacturing [ph] the in decline in PMI the improved XX of exited June. continued in seeing second range we quarter Manpower as was U.S. range decline March from the XX during [ph] the the XX% quarter, Revenue a Within an U.S. quarter. a business decrease

in profit skills quarter. in revenue a The Experis basis, U.S. anniversaried IT the U.S. U.S., Experis approximately in XX% organically XX% XX% of year-ago gross days-adjusted Within of XXXX as of we comprised significant period. Experis the growth XX% the in the revenues. On brand comprised decreased

ago from from the clients. pronounced pull-back this growth most year experienced earlier, clients referenced period's enterprise As is and period dramatic these enterprise

lower MSP Talent record as in the decrease prior we revenue contributed quarter at The some margin of lower gross business as within hiring the U.S. RPO by our a of revenues revenue second Management increases. in drove programs decline in XX% the saw activity in decline profit This continued Solutions levels year. our significant reduced quarter. we Right and revenue U.S. the growth outplacement anniversaried business U.S. experienced activity, XX% the as in was driven permanent in

quarter expect a decline the XXXX, year-over-year slightly the revenue of to U.S. third compared similar lower as we to second In trend of the in quarter rate

Reported X% Operations. includes OUP of currency. Southern at costs which in quarter. came Revenue XX% to restructuring $X.X in were consolidated comprised Spain organic of the revenue million in Europe revenue related a $X Europe was Southern and billion, $XX million our constant representing decrease in

XX% OUP a in XX% in constant organic was comprised X.X%. segment of $XX was OUP and basis. quarter million billion currency. in revenue Europe margin France was quarter the quarter our decrease margin flat organic for X.X%. an days-adjusted million OUP constant OUP France $XX business currency on $X.X the was adjusted, As and was revenue of the equaled Southern and the in representing

estimating are year France quarter slight We currency for decrease year-over-year representing the third trend constant to year in days-adjusted the currency a over a be very revenue constant result. flat

$XXX and X.X%. equaled basis. million OUP $XX currency quarter a Italy margin on constant in flat was days-adjusted million the Revenue was OUP and in equaled

We expect third quarter. a similar second the decline to in rate revenue quarter constant the currency of compared

Europe Revenue was of Germany restructuring segment a margin X.X%. costs in OUP our X% million costs in and excluding After Northern $XXX million a The was XX% adjusted OUP Our Nordics $X comprised restructuring currency. to of represented negative operations. related quarter. of revenue a consolidated negative constant and the decline million, $X

is represented segment the Europe quarter. Our Northern of revenues the in the segment XX% market U.K. which in largest

decline reflects decreased a on constant During this This the basis. U.K. first from quarter, quarter basis. revenues the of a XX% stabilized on rate days-adjusted same currency

expect revenue in second decline similar to quarter. the constant third quarter the of We compared rate currency a

Germany. constant automotive In business, quarters Germany, revenues particularly consecutive Manpower three quarter improvement representing days-adjusted increased the that the sector. in were evaluation our currency of X% performing business underperforming managed driven in services I detailed a in of last mentioned by Proservia in our quarter, we

to We down decided wind this commencing in wind The are have concluded this business. evaluation down and quarter. activities the third have

the restructuring business quarter on This I in compared has drag will to growth expecting further Overall, a Manpower as rate operations forward. provide currency quarter third Germany revenue earnings results. a going part details driven trend we are on been our expected our with associated down profitability charges and our significant the second constant of quarter business. improve by of third will actions the this these similar wind

on a this In basis. of revenue stable days-adjusted constant X% basis a currency the quarter rate and first the from represented decreased Netherlands, same decline this on

revenue quarter, Middle constant The of was segment Asia Pacific grew the was company million. XX% $XXX comprises $XX and total East million OUP In OUP currency in X% margin revenue. to X.X%.

constant quarter. we market in Japan We largest performance XX% pleased in in revenue APME expect continued of Our currency, days-adjusted strong of Japan basis. Japan remain XX% our in the quarter. the consistent grew revenues the business with third is and XX% growth very or segment Revenue a which segment the in represented on

balance quarter, within of year I'll and to million year. payments million the The higher sheet. MSP to represented now outflow of $XXX by prior of our turn of flow business. second current flow In outflow and $XX cash free an large timing an in compared cash timing outflow in driven was payables the the

of At second days at outstanding the quarter, the sales flat days. was end XX

During the $XX quarter, capital second expenditures million. represented

During the for quarter we stock repurchased second shares million. of XXX,XXX $XX

for XXth, program we XXXX. approved repurchase of June of share remaining under in As the XXX,XXX have shares August

$XXX total at $X with $XXX quarter-end. million balance quarter million Net debt of Our sheet and ended cash debt the of equaled billion.

to months Adjusted at debt total of Our debt reflect total [ph] quarter-end total gross adjusted capitalization twelve ratios trailing XX%. and EBITDA X.XX to at debt

unchanged credit debt facilities remained the Our quarter. during and

to review trends in anticipates forecast U.S. taken. continue be partially Based is of second third and additional will that I'll being anticipates offset actions further date, outlook on second the activity This permanent third challenging recruitment our weakening the based quarter the to by on activity for XXXX. cautious in quarter the July Next, in quarter quarter and our and developments Europe. of cost the

are $X.XX in foreign $X.XX be which for earnings range per to to the third $X.XX favorable currency per of We the of a share. forecasting impact includes underlying quarter share

foreign have rate guidance the estimates We slide. the bottom disclosed currency translation our at of

is billing X.X% days-adjusted the decrease revenue on basis. between to represents revenue X% and an organic and acquisitions about to This of comparable is of decrease. this in day decrease is impact negligible a currency a this X% X% trend midpoint the The is Our period second contributing constant X same the net constant currency the at quarter and a there of less at mid-point. guidance range decrease

that to third rate We down tax third We expect quarter our prior the for XX%. quarter points basis during the at the the year. be midpoint estimate to EBITDA the margin XXX compared be will effective

additional we guidance As shares does or charges estimate share usual, XX.X our repurchases be million. restructuring to average not incorporate our weighted and

earnings. services will with have do restructuring mentioned, Proservia we separately and As to when report I charges restructuring of managed business wind our any we third we those Germany charges the down expect disclose additional in associated and quarter our

will for business of Argentina currency does the translation separately. Our guidance also the not that report include impact also Hyperinflationary non-cash adjustment our and we

to Jonas. will I it now back turn

Jonas Prising

in To meet We of Jack. in opportunities and clear strategy. brands propositions the and for transformation success strong building with continue demands diversification market we Solutions. the good market positions to Thanks, us progress Talent value and feel our our of position agenda in differentiated the Experis and strategy, very about Manpower, future support a

and productivity digitization and and a Our enabler be strategy for data clients will providing want. innovation insights candidates key our

infrastructure markets growth a enabled through our back-office for across technology Our applications great platform differentiator. in cloud the our industry and ongoing common footprint, key another will enable of strong implementation We of opportunities and this global substantially leading accelerated XXXX, productivity believe future. PowerSuite leading covers all with global

taking the business strategy to decisive our also our simplify model evolve our our and aligned are are investments. prioritize actions operations, We that within brand/geo with

our discipline point solutions or our will that in and IT decision strategy do services reinforces Germany, Our clearer that the necessary portfolio The is actions is committed fit and ever strategy difficult to not in and managed rates. though strategy. that our our we address take one, business is we business not down that on than Proservia our wind to businesses are to proof profitability focusing to hurdle a adjusting resourcing for meet core a

Recruitment Global the Leader for strategy, in in and year very highlighted to especially Outsourcing talent Process Matrix Group America, be pleased are sustainability. Africa. Everest talent the XXth East in North named Talent in and talent practices Middle advisory recognized Europe, PEAK talent Assessment Solutions' Asia and a Everest We Pacific transformation

diverse partnerships. talent services DEIB DEIB clients, for to and Additionally, recognized we providing including were sourcing

working by and reaffirmed we refugee will that our XX,XXX recognized committing partners. to in by commitment over the In is by our we three place talent to This XX,XXX of refugees training Our clients refugee next upskilling our opportunities includes years, and and a employment our MyPath providing and into to integrating mix dedication refugees Ukrainian clients employment Academies. meaningful with courses Europe and through including women. Experis and support diverse refugees others June, including with XX,XXX

despite of I would more team another drive for to quarter forward ManpowerGroup the the markets. dedication world business close like by thanking environment our challenging in many around a to

Our for has we when in much are similar environment preparing markets as as an team challenges navigating on strong the and leadership are uncertain focused experienced the rebound past improve. we faced a also

And I to will Operator? open Q&A. with that,

Operator

[Operator Mark Baird. Marcon from Instructions] Our first question with comes

Mark Marcon

need can enterprise in trends little Wondering what in of of seeing you and about you're and that's resources? little and clients hearing overall holding of you're is across what U.S. Experis narratives terms that better. a are terms from to contrast the that more that spending things -- talk the the would we compare some a the -- bit that outlook you relative how their And bit larger for up the see in economy

Jonas Prising

thanks the and Mark Sure, question. for

They really about continued first that quarter. That that pull clients continuation call in a the they really market. trends the when specific seeing strengthening the in this our saw talked for what quarter. the waiting our a back we I'm back a we clients quarter. that to signs think for Enterprise to boom the They as conversations describe had a in on continue a time that first here today of bottoming had XXXX. clients we interested very I and about U.S. of with in skill hiring be market second clearer the hiring from specifically from enterprise and into U.K. boom are And They I continued that is trend pulled and we're started talking about in sense our sets. mostly would

And is as which player we with convenience although frankly, in is We very softer, markets very market. you trends, also in because there opportunities. that great growth those convenience a strong our And have are which the again. feel are enterprise enterprise holding both going and revenue -- market can the well. know market better good, we tell still strength opportunities we from think then, market up the market. get about And our the contrast They to in going provide for from much than I service with when the

So it's that our really hiring saw first Experis, us. so that's what of and industry the notably, been quarter have boom industries backdrop what tech of a continuation really we trends number the in of a are a serve, against that's that we seeing in clients we in the a telling

Mark Marcon

do Along terms staying fourth murky still the by for signs those emerging of those does think seem you up lines, first their they signs, or from some it are quarter perspective? that in -- -- clearer quarter? clearer pretty could it just is Or waiting end the

Jonas Prising

quarters we see number level labor And overall quarters many a if down an perspective would for our you a tell of I'm for variety us, look if we as perspective, there the and level. the about and U.S. from is client to call are in But industry think many the you recession it's the coming the in of to U.S., operating look indicative on an from what in industry the a business, now garden and at something our hard market as turn data, of I indicators lower already a Europe. our more signals around. sure you are is at that conflicting that economy so environment would in when

hours coming seen You've down. worked

looking more part-time full-time for You've seen work. people

all are a the market. So for slightly indicators worsening there labor

transpired hasn't labor with to policymakers some exactly about tamper our talk a cool broader is we can rising have it our their in why and yet the market which Although we what quarter the inflation. you very in expect into inflation of us second to step off down whilst will the and inflation means but it. try that's frankly, that's in the And perm means which on expectation. see labor resilient labor come continue entirely continue It's will weakening further the battle saw to down to against that that And market is into economy and or, consistent broader see outlook. that we wage markets still view significant

Mark Marcon

Yes. Europe, consistent longer-term Europe. what should years And as regards maybe Can -- just have Proservia Obviously, Europe X with to Northern with about well. out, Northern that's regards with last perspective, X the expectations telegraphed you of shifting from to quarter. Northern to investors expecting think were you to When move a we margin sort what over Jonas?

Jonas Prising

as our couple I business, things. of at Europe look countries. have where is think a This you of you most we Northern bench the Mark, have

biggest when in the is see our keep this a decline on in hit you decline there. region that the So bench revenue, we the because takes margins

you've evolution on us today's that about do a our turnaround. do that You to the good biggest that which And the a we're heard that the countries, say working we we've a side Experis been on exposure both Germany have have then, saw enterprise with we're turning have of on need have that making well. we're and about, to seeing we work on couple on has talked talk quarters one the is we progress the as some what staffing earnings last the business we're with exactly working over I here business this and call. that already around. but And to side pleased weakness And to also But signaling been and address. U.K. more in we our in Manpower of the sensitive revenues we're

of confident heard as Europe would not the you with come actions reason back to bit talk this into on actions profitability decisive the now, track about target some whole. region that actions Northern on Northern relates little no it's and is decisive back to a get taking we there But as are future, a us Europe Germany but of expect we our have I Right the on say those that levels by perfect will business a our to we're it Proservia to today one in that and call. storm

Operator

Tong Sachs. Our next George Goldman with question from comes

George Tong

some in specifically, of the the declines You the how Solutions, RPO trends are you touched MSP of Talent on trends performing in some Experis. driving factors on Can and the business? elaborate with

Jonas Prising

The enterprise is effects the slowing course, a clearly perspective. environment And business. RPO an permanent has very RPO Sure. business of It is feeling hiring the of from recruitment limited convenience activities.

So in it hiring the performance of both fantastic right had really really from crosshairs exactly now, and perm is benefited slowdown boom. enterprise and the

position very recruitment. spend very about enterprise business. a the that have as evidenced reductions going and now, reduction We permanent the we're through economic But strong in leaders. the we see we're can in right both in feel RPO, cycle global We in good

we're is of RPO client our having that really MSP on is this quarter. some stabilize, taking a time is actions So mix tougher the rebalancing in to there. believe really and seeing starting we

very we're activity And in finally, of course, Talent this Solutions, part and as Management quarter. of seeing strong Right in growth

feeling on So picture overall, whole, that in the and recruitment. strong businesses RPO our staffing levels you aligned effects the performance. then MSP, Right mixed we're permanent it's so really Management reflecting the seeing of a with a

George Tong

helpful. that's Okay,

the core streamlining? actions opportunity to you the see potential example areas You great business there Are talked business further better the about strategy, align of and a Proservia to that taking additional in for was the simplify of operations decisive or the that.

Jonas Prising

portfolio. going can be that looking Over what time, there at in do. I we're geographic us to areas be terms seen our we you've look at might think of

we And do think should to that. when I You've number seen are address environment, we continue be advance. closely. something we But very you have and we cost we clearly, more us made where proceeding looking us I expect Jack, at now maybe to we've this and also areas, the a of Proservia. in you in important, and better particularly do SG&A think, decisions, can But tell we're focused the with think

a on bit elaborate So little maybe you'd this well. like as to

Jack McGinnis

some during that. Jonas. Jonas probably the countries. Sure. that taken are of done that, where QX. of did was examples Germany talked other where actions, of bigger some bench some Thanks, about, there Proservia have we We've Yes. restructuring talked part have as the well. part George, And we've And Europe. we Spain have modest wind-down about course, Those Northern commencing. then, we Nordics, The streamlining

with line are said So what we we previous quarter. in

are area business And are the of seeing at on sales. functions and slowing that looking also broader parts corporate actions will and country that, as more won't acting looking but pulling taking adjustments. well discretionary cutting broader making the significant and spend, than be back headquarter hear talk functions, at you We looking we're at one us about

We're on upturn to focused be focused continuing on it very and very comes for the producer we're counts. positioned when

that right close outside and right we'll the you we're close clients, next and So expect update a you costs in on keeping very Jonas taking next and and very further councils a look say, would workers' as quarter. would give now, the in those we'll it pulling I quarter. and a expect middle back talk taking eye should sales, about on we're that of producers a said, And as being specific lot areas. very actions careful. and Proservia We're more with working of But

Operator

next Our Josh Chan question with comes from UBS.

Josh Chan

I you the Europe into like about could resilience was sounds It kind the continue quarter. will the Southern of that -- versus I next U.S. talk wondering in relative guess if like

could as in we and kind this guess your that I think sustainability you of next -- of continue the thoughts part performance on cycle? difference of that whether into just So go curious the economic

Jonas Prising

And their nature, are in the historically, market is length They in much are change U.S. more labor as downturn that the notably markets. I would Experis saw, the Europe that like, also both never scheduled back more well quickly you pandemic forget say run Europe, numbers you the from XXXX. as Thanks, whereas that U.S. started you labor And have on so extended would contracts in of really the end. can to XXXX Josh. assignment don't dynamic that European we the have to term in Yes. in in contracts a structures in to as we that have saw that as And Jeff, rigid short their the France than Manpower comeback France, in more Josh.

see of Italian to sort explanation underpenetrated think the continued a stability opportunity that think market see we France. some very that's continue rates. in pleased We we're us see is the the the where you So to fantastic penetration growth. is markets, for increases one of and to very And could in profitable

and of and this, market this on U.S. faster for and to is seeing that expect economy in faster well. the exactly what expect a the to what in than get that And we good rebound cycle up down to end see the we're comes rebounds U.S. goes And here upbound we see we when we Europe. expect would be also the would would to opportunities as

Josh Chan

guess then within And follow-up, great. that's ask U.S. Manpower the Okay, the my for wanted I business I about to

kind seeing might think kind talk a softened I of little points you you're that, just that about that it again We're out guys that the in Could improvement be trajectory what mentioned of saw surprised there. data there. then and QX. by some to seemingly you compared

business? So color that curious any on

Jack McGinnis

maybe happy And just be about that. I'd yes, talk to trend. Josh, that to to talk

in So what Europe about compared catch-up seeing exited talked as big XX%. the at the where earlier XXXX. quarter that running about quarter And U.S. the about seeing Manpower the was was QX, we to much talked first we minus was in we U.S. the

well. in exactly quarter, definitely in PMIs prepared with strong that about our aligned remarks first very what that we the through talked seeing in were we manufacturing came as So

down the what's ending take with first happened continue ending and a So the we're high-XXs, in June we So with here quarter to XX.X%. PMIs since manufacturing then?

trends. manufacturing the into expect and continues that see see So quarter. And we those worsen environment in did QX to that Manpower to reflect to the we into second

the So expect see additional up that's did some we see at we that to XX%. and decrease minus to minus XX%, ended how

that rate to when of Now we XX%, some quarter, that quarter. with improvement beginning the as most And decline. the you highlight the ended was said, of look minus that were we we in at being the fact it that starting see heaviest did at

we from We're It looking most the guide be now. at to right you that third better, see say, Jonas are we're as are reflect our market for so that overall. trends. all the out that's the we for might for playing a cautious we the might we'll dynamics third Manpower reasons side. that going can forward the being see does we And the did the some bit of that on cautious So way seeing part, as look stance But it talked into the right continuation of a U.S. now, the quarter, U.S. in see current about quarter. with the the

Operator

Our with next question comes from Jeff Capital BMO Silber Markets.

Jeff Silber

some You major comments intra-quarter U.S. markets? other talked get intra-quarter on little your trends bit trends Can we about similar in some the a in of

Jack McGinnis

to talk be I'd to Jeff. happy Sure, that.

at quarter. if France, story I'd that is the during revenue So you biggest our stable look country, say the relatively

X% that was well. is So that stable holidays. reflects May about trend similar particularly about intra-quarter, X month, to as -- from in a a X to adjusted and the it tricky rate. organic Europe always due days And quarter quarter

wouldn't much but into read that. So little too a lower I

holiday on But softer basis generally the adjusted days mostly a think a than we overall, than coming maybe say Italy, maybe little a where than in little play I'd into were other I'd is and year-over-year a I'd effect. the that, bit April. May saw we what But pretty stable. bit, it's saw I June consistent. similar, say with say pretty tad,

U.K. U.K., Talked coming and quarter-over-quarter, at about very we're say XX% basis, QX. an the versus overall minus similar on the in I'd U.S. the that a on on

the days impact a During more overall rate. June bit a which had see I pullback there, of days I'd once of for pretty you the month to But say. compared generally did little the that in consistent, running second think a big quarter, of adjust we the course element

-- you guidance of QX, So the same really our the at more look it's for to and when predicting U.K.

we'll and It So bit could that how again, just of there better slight have and be to could out. see be bit cautious a turns a a view.

Jeff Silber

you perm. that's any about weaker you seeing clients? rates gross perspective? business little and the I could but and pushback from spreads; talk because Okay, on a of you a we a are pricing was stated if mostly margin margins; it curious, If you either can was Can just I'm bit lower focus And to bill or we just switch competitors from helpful. temp on think from gross than it over expected

Jonas Prising

looking although but our would continued I a pricing skill pricing about Jeff, overall market talent. in Overall, is indicator think a of And and remains that I demand our can tight you And seeing good say that great competitive tell the about where we still service, from the that companies pricing the holding reflects at and of think of still we for level clients stable are rational. that this services environment environment, I we're for time. quality softer, margin positive placing feel a our the as our are with staffing the labor continued, as sets essentially And good.

Operator

with Sommer comes next question Truist Our from Tobey Securities.

Tobey Sommer

cost way you in et from economic wanted to outsource about your their to same sales cetera. sort sort at to because But to sales the outsourcing ask look and more. hiring past are now not terms the choose revenue maybe you activity the I a question -- understand that of this businesses, in responding great internal lower. And right speak have could opportunity, of Are period of that. slower they MSP, I RPO, may in maybe and be is clients structures

Jonas Prising

well in-house long for that evolves are that back economic productive. value a that offering to in-sourcing happen a addresses. proposition and cycle then And for the taking going and are suddenly own all things clearly recruiters an have is less Well, consider things I when and think of is companies tends time, lot what the they their you our thought they needed needs, RPO

up world do provides XXX, can whilst So to recruiters that perm from the we getting we clients in a feel there. in activity your from and need organization. have from hiring we our particular that how XX their about in impacted recruitment good the offering levels very you one the the And we And the the our the workforce. flexibility, insights flexibility we side, at appreciate across them from data that good MSP on our RPO true proposition strategic customers And by they and business that very about feel significant about the value operational both to advise our seeing an RPO the to because to from one our we're on derive our hiring that is with case evolution value really, clients increase MSP opportunities perspective, seen sets and should is the business again we've the model in when starts that We today the and or think look really same side very, perspective. country quickly. very of

at and you we there, or this resourcing MSP that the if IT that temporary expand beyond within from provide look leaning are into clients you umbrella. beyond products our And staffing of and offerings of to able and are our can really expansion offering the statement into work we see services our

and and operational for can way provide that boot. feel So activities than flexibility to really address in these strategic cases, good many we in can we the a we that with themselves them better non-core both of they corporations

expect good tougher really market once to other RPO the a So feel about as and business the way. stabilizes the today that ahead for we go would it is the we lies starts but time opportunity

Tobey Sommer

inform forward-looking what on more widespread question And And risk Management; the if about do Right you? KPIs how your most I further layoffs? could ask of tell you do a or they

Jonas Prising

that in Management. at same pressure current Experis where from we're seeing say an verticals would and that we're time, industry verticals, industry our the on in opportunities the enterprise the the seeing perspective are I Manpower in Right

That it specific. what is the strong placement business. And the saw geographies certain very and also Management we're of in that So our remember from course, industry year, case; when business be I would because is last that low a to is outplacement or Right hiring Right not It is, not is Management we seeing characterize of activity. amongst broad-based layoffs. boom

for in not that feeling seeing strength the the that broad-based. but the are Manpower Experis we're from U.K. side on and it's U.S. sectors today the is and the and pressure So enterprise same the notably really

Operator

Northcoast from comes question next Kartik with Research. Mehta Our

Kartik Mehta

played previous fairly I the it out? you and we're see does downturns at think you or competitors I'm pricing talked seems obviously doing just how it's it's wondering everybody you fairly the when an into to contractions, of when wondering issue? contraction? in kind Do become your previous to about waiting until past behaving now well. I'm seems behaving be -- what be look pricing

Jonas Prising

haven't is so and be contract to because in was and as we well last indicative levels at at think be sign variety company resilient impacted downturn the cycle. as on, a talent if as about that would it course, mentioned market And depth very very pricing way, we're good to deeper of inside labor be and recession, compete to perspective you we're And a Well, time competitors recession shortages on be this Whatever any is depends will could you access shown and a of economists. I talent as the are a could about level. operating there industry an It maintain ability markets moderate would would we -- tight whether we share and abound. strong but combine a is, of economic softening on quarter when that our data our as a think any of all our call industry is then characterize but would, maintain And price. our in data much that slowdown. in so of early could it the looking that if significantly the try material from a economic recession. call, far very labor a with and markets garden broad important technical feel It not economic pricing

that of at certainly into technological you for and you pricing the sets, competitive offset initiatives future is believe look labor be the look market. rational mentioned and strength I are But should us move we're if our not this that it even if at skill demographics, pricing pricing tend that demand you our in will change, go the greater up with as in drivers provide specialization a it higher Manpower that any an profiles But if into to -- we could strength through that very at demand other pressure. today. fundamental in both always The Experis and earlier, but additional of point, today market, is seeing at look

deal are but we the positive competing perspective. still for from pricing every So demand a overall is

Kartik Mehta

talked is Or on French then, the changed has of that? you Jack, And data kind of for the that tax, September point or in next anything we've I is this think stated when accurate? the past that business still year,

Jack McGinnis

Yes, that's accurate. Kartik. still Yes,

color. budget this to next at the expect President we comes when to see see mid-September, that's that preliminary for we We usually point more think out and do when that year, I of know to business Macron continues future important have the France. French the strong tax, feelings very this component the is very competitiveness of the tax, repeal of the business that French final

won't know go will that planned. it it that to a through good feel chance that, preliminary the until So budget. as we there's us that good we confirm makes very see really in But until

significant so that benefit improve by rate that know as we another that us will when of effective global said months. before, for our downwards. happens, a And is X.X% we'll couple And a in

looking look So that to forward giving call. on that forward our to update on and earnings an we're next

Operator

next Our Jefferies. with Stephanie question Moore comes from

Stephanie Moore

more Pacific, seems bit little one your the about a other talk segment East, to little Pacific or maybe you're there's be wondering Middle area, of a bit where in sort Asia was Asia saying strength to what regions. I it compared

there helpful? color would be any So

Jonas Prising

and Yes. also degree performing just Yes, we strong are also well. India of business. those resilient good quarter there We're specifically consecutive in Asia our in very terms are markets. our both Japanese Japan, where are XXth Latin some market very X Pacific; to growth. has markets client strength, businesses about in And We we we next we profitability of good are have the They The about Sure, business our size, regions Australia areas. feel the and levels labor but in there concluded seeing rebalancing mix And are in America. some Pac Stephanie. in those if there strong talked also positions. seeing Asia

terms They in that good So demographically we of and it America, American both Latin relates frankly, a very resources, as Asia benefit in we where an in position our IT of very India, great feel about Asia strong also we resources positions also are markets onshore near-shoring to activities. are for locations offshore Pac experience footprint strong in very perspective. and North has but in from course, And strong. particular, have that

So we're Pac we the Latin America, very pleased and with given the in broader performance that picture. in have Asia

Jack McGinnis

and add the like the impacting Australia, what the contributor in that's just India would making on Stephanie, side, a stable can the some on continue to bottom the very third the and I for countries Jonas dollars that revenue quarter. tighter for But and OUP be some on we of the expect margin line trend. to -- guide of staffing APME, mentioned based still on mix-related revenue you is see changes strong we're margin into APME

Stephanie Moore

and within then, look bit as talk you embedded at outlook, quarter little just a third guidance? And the for lastly about some maybe could margin takes me; your puts your you gross of Great.

Jack McGinnis

happy be to, I'd Stephanie.

in what consider think I you when happened quarter. second it's So the pretty actually straightforward,

can second So factor our you the walk, in in quarter. our prepared I think perm was and big swing that comments in really see the recruitments

it's more the bit quarter, still well GP bit a into that we said, pressure perm. of off came really environment, That's With the XX is we holding a down why being the current up so expected perm continuation than third fairly more bps So that going in in quarter. second XX.X% the margin. had on

are a than that bit of little bit came off cautious in taking a we QX. more anticipating we stance perm a So expected

that going off to continue we're bit is QX. So into perm to a come more anticipating

the really That's margin what's change. driving

on one to pressure that in to hold is the forecast is midpoint. lot the We So on we just perm the off. to is I think third had continuing that's the sequentially, item quarter. Jonas gave staffing margin at our offset margin, is up just that go the well for just on Management. and really from conversation Right And very XX.X% staffing been and helpful to a XX.X% we color -- And can based that run of continuing perm

So we are seeing that.

and it have -- trends of bridge You expect will to Management positive that the offset can we to in perm offset pressure continue which Right see well third some we're GP help partially the as that anticipating. quarter into

Operator

Manav Our next from with question Barclays. comes Patnaik

Unidentified Analyst

the and the you This business regards Princy Thomas made [ph] is digitization, you around investments date in on impact Can what's assess the to for Manav. are to come. on where to

growth Gen to Human supposed get I positioned PowerSuite want know lab? benefit to is and around and is the AI impacts accelerate cloud how just I Age to Man of Specifically, ideas back productivity. New with office

Jonas Prising

global towards in will substantially Sure. year, Yes. major of PowerSuite our have all we end No, as we prepared remarks, mentioned of our platform. markets our this on the

where us digitization that of our strategy so our brings And all common have websites in across world we in major is the markets. that

of different being well, that We deployed infrastructure investments It's And operating we've is been so major all office We're a creating are have working difficult at number many we the where well. of global back our same over front are that operate to making in scale. office platform in in also. applications markets. you years and implement one application gone cloud-enabled on then implementations the a that service back-office countries and environments have those as suite business, the so very

people our feel importantly, bit But us accelerated the this very productivity us and more for that of well forward. driving about cycle color We the maybe innovation give that recruiter But the growth of we and and some are as of feel through work to should little good we've in you the very those good tools having insights investments very give recruiters but best-of-breed where Jack, growth and to size about going opportunities both initiatives generate most drive efficiency gives we a our want investments. really the terms frontline in done here. to opportunities data driving as the good

Jack McGinnis

to. good us for be we we'd how No, investments feel I far. so Yes, paying really happy Yes. Princy, off say would those about are

our couple we've into where we at years of the to recruiters, about those implemented where early. the and we've increase the really KPIs and of in we adoption been that's last for move going good implementation productivity feel we've we're -- making we're where adoption implemented markets markets, So front we We look the the early. about that know seeing there progress in is then office recruiter and the talking

feel we on that investment. So return good the about

a XX% Jonas more majority typically, back You'll and that on very pronounced when And that XXXX on as operational system. our volume in end front at that of business. the end operational we're office we business see more by front said process that get leverage clearly of way the with into of the office,

at also in business. the past The implementations look another industry-leading heard talk we're on of you've countries. in across, in, cloud-enabled of well, we're doing is back the we other that about platform office going parts live process as putting me something the As in X

rollouts We there. continue very phased

well. good as And efficiency going that's that, us about we to feel into additional really future the the give

into and move And more we're benefit 'XX. going immediately I that 'XX; area color office efficiency for. to to get were front you and come And through you'll it think the start year back of which as 'XX more as office this move operational for in office a we that but metrics little back main through the see into continue will And really from to of forward. our in and front office 'XX that from will we'll timing that the so it the see there. see nicely we more the continue waves So on 'XX move of more in end looking covers the you'll

Unidentified Analyst

also for does. keep provide by month you're regional can follow-up, then France. for the you've the But quarter can X is and it and you unpack for my And first Yes, specifically performance seeing and takes of outlook, the for up what seeing what your weeks you been July?

Jack McGinnis

Yes.

we're one questions a I would trying We're say, say earlier I'd actually I the quick short little on think get covered Princy, that talked from we of previously a and of the to I other intra-quarter is, off. questions. to time. what to couple What So

think about organic pretty in takeaway X.X%, overall, think guide trend terms from third in really that what into minus in much the I market QX a days We the line the what saw, revenue of is adjusted I perspective. consistent QX U.S. continuing reflects just talked with pretty from that in main being trend guided is for QX, at for adjustment quarter. we France and improvement what the into we the the trend

in So markets across that our stable we again, part, for most trends the of were outlook. cautious lot major and a

So the I would say main item. that's

right back quarter. on depending cautious know about in more think color in guide. third but September and the activity I third holidays month last is out the a August into always on the of predict, how August always difficult is we're Europe Europe, a comes ongoing from basis we your you from do lower to with as that's is to into quarter that the bit an point, anticipating think now, anticipate we're manufacturing stability we holidays expecting Again, perspective. on being what a little coming But overall a

Operator

from Andrew JPMorgan. Our next question with comes Steinerman

Stephanie Yee

garden very in well. just about you Yee up clarify to staffing as staffing Stephanie Andrew. wanted for is clarify This you're hours already stepping speaking opposed temporary down recession, I is activity as the pricing, holding perm want temporary to to are whether comments earlier, still earlier industry but in being variety I mentioned to because a staffing your just

and for the overall guess, supporting industry growth, it's I So revenue for manpower. the

also at recession you would characterize garden-variety point? as just this temporary a is So staffing clarity on in whether what

Jonas Prising

temporary we -- very where expected in seen markets that the variety pandemic I being recession. in of what But using the one shallow U.S. last a other a economic in staffing generated in we've one that related obviously and the was I'll by a than U.S., description see short-lived cycle shorter term. of in that in in are you would driven what that the for shallower the much cycle the variety seen of would a the and have past great you're then eventually not Europe reflecting industry recession, sense would be seeing data economic the a this Netherlands, if say which can see equivalent to data we've softer these downturns, allow my U.K., you equivalent operate environment levels when that I'm statement what to just temp you the more few Prism point pandemic, recession that us two be [ph] give in you would to to me garden a garden there was France, from that by and activities the or at Sweden, past, is the recessions,

lack recessions, it on that the the in for sorry exactly than way. But recession a it of is garden-variety what what And put seen we've precision last of is. shallower couple

Stephanie Yee

Okay.

extrapolate step Okay. just further. I that appreciate to take a just that. I'm sorry, maybe

in U.S. a example, economy, for garden-variety recession wouldn't because necessarily characterize rate is very I low. guess, unemployment the we the as is, labor market, still So that being the

So see if the further economy industry or in a would probably recession, safe to decline? say that the staffing

Jonas Prising

is of leading what As be tends you then to to a come. industry know, our indicator

in point was, later not the in for being fact, because that expect, perm further apparent recruitment of statistics -- come that the I many market the your continued on to all one inflation. strong think and economic economy, economic the little reason instance, so is the market labor slowdown, rest we a seeing contributing to an that high is are we it strong matter. But a factors bit of out although labor lagging are so resilient markets often labor concurrent would exactly to and why cycle, markets, our down are find we We as an for is

U.S. what And expect also seeing rebound. the we reflect we just also would sector. staffing are in we, because market leading market a expect labor would rebounds and any labor indicator to normal in industry broader labor are temporary a rebound ultimately, before a then Europe to we our -- we industry So as eventually of than as would the generally

our So business that's thinking it. how seeing we're I to hope how it from perspective. we're clarify And about managed I've

Operator

participation. day. time the Everyone, have may Thank you Thank great we program you. questions That's and today. disconnect. you the conclude for now have all a does your This for

ManpowerGroup (MAN) 20 Jul 232023 Q2 Earnings call transcript