Welcome to ManpowerGroup's Fourth Quarter Earnings Results Conference Call. You will be put into listen-only mode until the question and answer session time begins. 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 Chair and CEO, Mr. Jonas Prising. Sir, you may begin.

Good morning, and thank you for joining us for our fourth quarter 2025 conference call. Our Chief Financial Officer, Jack McGinnis, and our President and Chief Strategy Officer, Becky Frankiewicz, are both with me today. For your convenience, our prepared remarks are available in the Investor Relations section of our website at manpowergroup.com. I'll begin with a brief overview of the quarter and the full year, including how we're seeing conditions evolve across markets and what that means for our execution. Becky will ground us in the broader environment, what we're hearing directly from the market, and how we're evaluating those insights as we position the business. Jack will then walk through the detailed financial results and our guidance for 2026. I'll close with a few comments before we open the line for Q&A. Jack will now cover the safe harbor language.

Good morning, everyone. This conference call includes forward-looking statements, including statements concerning economic and geopolitical conditions, which are subject to known and unknown risks and uncertainties. These statements are based on management's current expectations or beliefs. Actual results might differ materially from those projected in the forward-looking statements. We assume no obligation to update or revise any forward-looking statements. Slide two of our earnings release presentation further identifies forward-looking statements made in this call and factors that may cause our actual results to differ materially and information regarding reconciliation of non-GAAP measures.

Thanks, Jack. Let me begin by saying we're pleased with our fourth quarter results, which marked a clear shift to stabilization, led by enterprise demand and supported by disciplined and continued commitment to cost optimization. In the fourth quarter, we delivered reported revenues of $4.7 billion, which represented organic constant currency growth of 2%. System-wide revenue, which includes our expanding franchise revenue base, was $5.1 billion. Adjusted EBITDA margin of 2.1% reflects improving demand trends across core markets, as well as P&L leverage. Though we faced strong headwinds during 2025, reflected in our full-year results, we are encouraged by our fourth quarter performance, which demonstrated sequential improvement through year-end. As we move through the fourth quarter, revenue trends strengthened in several key markets. Clients remain deliberate in their hiring given the macro backdrop, yet engagement levels are steady, and activity is becoming more consistent. Importantly, while we're not yet calling a broad-based recovery, we are seeing clear sequential improvement in key demand indicators, including Manpower associates on assignments in key markets, such as the US and France, which are performing better than expected, with France in particular showing resilience despite ongoing political and budget uncertainty. Markets such as Italy and Spain stabilized earlier and began to inflect, with Italy standing out as a clear outperformer on both growth and margin. These trends reinforce our view that the shape of the recovery can be different by market, with some inflecting earlier and others requiring longer periods of stabilization first. Against this backdrop, our priorities remain clear: execute with rigor, maintain cost discipline, and leverage our digitization advantage to position the business to generate operating leverage as demand improves. We are working to ensure that we're structurally stronger, more efficient, agile, and better positioned to capture share. To that end, our diversified…

Thanks, Jonas. Glad to be with you all this morning. My remit for ManpowerGroup is focused on three areas: driving commercial excellence, evolving our core capabilities to better serve the business, and infusing AI in the organization for today and tomorrow. In recent months, we've embarked on a comprehensive process to evaluate our strategy and priorities as AI accelerates and client and candidate needs change. As part of this work, we've engaged a wide set of experts, inside and outside our industry, including our clients and candidates, to conduct independent research and rigorous analysis across both technology and human behavior. While we are still early in this process, this work is surfacing two clear macro themes around how clients and candidates want to engage with us. First, flexibility. Candidates are increasingly looking to curate flexible engagement models for when, where, and how they contribute to work. Our clients are also seeking flexibility to attract talent and to remain agile in the changing landscape. The second theme is how AI will shape workforce composition. Our clients are asking tough questions: How could I get work done in the future? What are the new paths between humans and technology? They are increasingly seeking our advisory capabilities on new ways to get work done beyond the traditional models. Advancing the path of temp and perm alongside newer models of flexibility like gig and freelance, and they are seeking guidance on the newest path to work, leveraging AI in combination with humans for productivity and for growth. From this research and our continuous connections with clients across every industry, the intersection of AI and workforce readiness is an urgent priority. And unlocking productivity gains and growth will depend on combining technology adoption with workforce transformation. This was reinforced once again by our engagement with clients and prospects at the World Economic Forum in Davos last week, where we showcased insight and research around what we are calling the human edge, where empathy, imagination, and resilience are elevated by technology, and where human potential meets digital intelligence. Ultimately, these insights give us enhanced visibility on where client demand and growth will be, enabling us to make critical decisions now on where to play and how to win. Though we're in the early stages of this process, we are encouraged that the opportunity ahead to further differentiate our offerings. I look forward to continuing to update you on this critically important initiative.

Thank you, Becky. As you heard, the environment for AI and automation continues to unfold. Since 2019, we have been executing against the clear technology roadmaps centered on PowerSuite, our end-to-end operating system and best-in-class technology stack. Today, PowerSuite operates across nearly 90% of our business, creating integrated global technology rails and proprietary data assets spanning more than 70 countries. This foundation enables faster innovation and allows us to convert technology adoption into productivity gains more quickly than in the past. Last quarter, we shared how we are increasingly moving from AI use cases to scaled commercial impact. Our integrated AI recruiter toolkit is now scaled to more than 12 markets, streamlining content creation, talent search, communication, and workflow automation. This is improving recruiter precision and productivity while enhancing the candidate experience to faster, smarter matching and real-time insights resulting in a 7% increase in placement rates. This is not just about productivity. It is about commercial excellence, positioning us to increase revenue, win clients, and deliver a superior experience to our clients and candidates. For instance, we are scaling the use of AgenTiK AI coding assistance across Experis in the US to deliver faster, higher quality, and more cost-efficient solutions for clients. This helps our clients accelerate delivery, improve product quality, and reduce operating costs while enabling us to strengthen our value proposition and win higher-margin work. More broadly, we're moving from experimentation to disciplined, governed deployment of AI, turning proprietary data, embedded technology, and human expertise into faster delivery, higher win rates, and durable differentiation. And as part of this commitment, we're upskilling our 25,000 employees and embedding AI more deeply across the organization to drive productivity, support higher-margin growth, and ensure that these gains translate into a leaner, more efficient cost structure. Pleased that we're able to deliver sequential improvement in revenue growth and profitability improvement through 2025, finishing Q4 with momentum that reflects stronger execution in our core markets and profitability improvements from our cost actions. Assuming current trends continue, and as we anniversary the tariff-related headwinds, we believe 2026 has the potential to represent an important inflection point for the business, with a path towards sustainable organic growth and margin expansion. At the same time, we remain agile and continue to monitor geopolitical developments. While uncertainty exists, our focus remains on supporting clients and executing in this evolving environment. And with that, I'll now turn it over to Jack to walk through the fourth quarter and full-year financial results in more detail.

Thanks, Jonas. In the fourth quarter, we delivered reported revenues of $4.7 billion. System-wide revenue was $5.1 billion. Our fourth quarter revenue results represented organic constant currency growth of 2%. US dollar reported revenues in the fourth quarter were impacted by foreign currency translation, and after adjusting for currency impacts, came in above the midpoint of our constant currency guidance range. Our revenue trends demonstrate the continuation of largely stable activity levels across North America and Europe overall, with improving trends in France and ongoing strength in Italy. Gross profit margin came in just below our guidance range, driven by lower permanent recruitment in Europe, while staffing margin came in as expected and consistent with the previous quarter year-over-year trend. As adjusted, EBITDA was $100 million, representing a 2% decrease in constant currency compared to the prior year period. As adjusted, EBITDA margin was 2.1%, equal to the prior year and came in at the midpoint of our guidance range. Foreign currency translation drove a favorable impact to the 7% US dollar reported revenue increase from the constant currency increase of 1%. Organic days adjusted constant currency revenue increased 2% in the quarter, which was favorable to our midpoint guidance of flat. Turning to the full-year results for a few moments. Reported earnings per share for the year was a negative $0.29. As adjusted, earnings per share was $2.97 and represented a constant currency decrease of 38%. Reported revenues for the year decreased 2% in constant currency to $18 billion, and system-wide revenues were $19.5 billion. Reported EBITDA was $270 million. As adjusted, EBITDA was $337 million, which represented a 20% constant currency decrease year over year. Transitioning to the EPS bridge, reported earnings per share for the quarter was $0.64. Adjusted EPS was $0.92 and came in $0.09 above…

Thank you, Jack. In closing, we're confident that we have the right strategy, capabilities, and team in place to execute in this environment. With improving consistency across our major markets and early signs of inflection becoming increasingly evident, our cost discipline, diversified portfolio, scaled digital and AI platform, this is a clear leverage as demand stabilizes. With improving productivity and margin potential over time. Thank you to our talented team for your relentless commitment and to our candidates and clients for your continued trust in ManpowerGroup. And that concludes our prepared remarks. And as we go into our Q&A session, I'd like to ask if you could limit your question to one so we can make sure everyone has the opportunity to ask a question this morning. And with that, I'll ask our operator, Michel, to start our Q&A session.

Thank you. If your question hasn't been answered and you'd like to remove yourself from the queue, press 11 again. And our first question comes from Mark Marcon with Baird. Your line is open.

Hey, good morning, Jonas and Jack. It's great to see that there's some early signs of an inflection here. Jonas, I'd like to go back to some of your earlier comments just on a broad base with regards to the productivity and not just productivity, but also excellence. Initiatives that you have with some of your technology. As PowerSuite is fully implemented and as you implement AI, I'm wondering if you could discuss a little bit from a longer-term perspective what your aspirations are in terms of where the margins could ultimately end up going if we end up having, you know, kind of a nontraditional, more moderate recovery in the markets as opposed to, you know, the types of cyclical rebounds that we've seen, you know, more traditionally back in the nineties, early aughts, post-GFC, just because it seems like employment on the whole is gonna, you know, be a little bit more limited in terms of growth. So I'm wondering if we have a moderate recovery, what should investors expect over the next two to four years with regards to where we could potentially go from a margin perspective?

Good morning, Mark. And, you know, as you've heard from our prepared remarks, we're pleased to see that, you know, we're seeing the early signs of an inflection coming through. But to your specific question about our PowerSuite and, you know, investments over the last couple of years, they've really put us in a really, really good position for us to think about ways to evolve our business and optimize, you know, our processes and improve our customer, our client, our candidate experience. Regardless of what the market does and how quickly it comes back. So as you heard from Becky's prepared remarks, we're really thinking about this around productivity and growth. And we're encouraged by the early signs that we're seeing. You heard me talk about a number of in terms of AI enablement around Experis, how we are improving the candidate experience and process as well. And, you know, we are really encouraged by what we're seeing. But as we said, it's early days yet. But our entire focus is around controlling what we can control, and whether that is a faster recovery or slower recovery, we're going to be driving growth and we're going to be driving productivity. We will always be a people business today, but we are going to be an AI-enabled global people business, and that's the path that we're on. And we are very encouraged by the results that we're seeing so far. But maybe Jack, you can talk a bit about what investors should expect from a longer-term perspective on margin.

Yeah. Happy to add some additional color there. I think, Mark, to Jonas's point, I think on the technology implementations that, you know, as you mentioned in the prepared remarks on the front office side, we're now 87% complete on PowerSuite front office revenues, global revenues running through. And on the back office, we're at 75%. We just had Italy go live as we ended the year. So we're in a really good place. A lot of the heavy lifting has been done on the technology implementation. And now we're very focused on centralization and standardization, and that is going to drive structural cost efficiency going forward. And as I mentioned on the back office, we expect that in the second half of this year. So even in a modest recovery scenario, you should expect EBITDA margin improvement year over year over the next four years in that scenario when we see continued improvement year over year. And as I we're really excited about extending the work we're doing on the back office now to starting additional work on the front office, and that's gonna drive it even further in terms of margin expansion opportunities going forward.

Any sort of goal or target that you would have just under a moderate recovery? I know it's early days, but just trying to get a realistic sense in terms of, you know, one point we were targeting four and a half percent. You know, is it realistic to assume that, hey, we could, you know, we should be able to get to 3%? Just wondering how you're thinking about it.

Yeah. Yeah. No. I would say first off, we're absolutely still committed to the four and a half to 5% mark. And you're right. We've delevered pretty the recent period here. So we're starting from a lower point. But from that lower point, we're very optimistic we have an opportunity to expand margin meaningfully from this point over the next few years here. To get back to the 4.5% to 5% over time. And it is going to be a measure of how much operational leverage comes in through the environment. That will help. But even without that, we're gonna have a really good opportunity to continue to climb progressively forward towards that four and a half percent over the next couple of years.

That's excellent. Thank you so much.

Thank you. Our next question comes from Andrew Steinerman with JPMorgan. Your line is open.

Hi. This one is probably a little tougher. So when you talk about a path towards sustainable organic revenue growth, could you give us a sense of what level of sustainable organic revenue growth is likely once the staffing market starts to improve? And then kind of an add-on to that question, we've been hearing a notable chatter from the staffing industry operators talking about an increased interest in flexible workers once such a recovery takes hold because labor uncertainty will remain. Do you have a view on that thesis?

So thanks, Andrew. Yeah. No. To predict when and how the market is going to be improving overall, I think, is difficult. But as you can tell, we've been improving our performance in the US, for instance, in a tough market with six quarters of continuous growth for the Manpower brand. You've seen a number of our countries, despite, you know, reasonably stable but not growing labor markets, perform very well, such as Italy and Spain, not to mention Japan that has forty-five quarters of consistent growth. So I'd say that just as Jack just mentioned in his conversation with Mark, that we're going to control what we can control. Make sure that we drive the efficiencies we need to do in markets where we are facing headwinds. We will be very focused on rightsizing the business and adjusting capacity to the existing demand. In markets where we see the opportunity, we're investing in demand-generating activities. And we'll keep on working very, very hard on driving growth to capture share, as well as driving the productivity initiatives that you have seen us execute on in a number of markets and over a number of quarters. And we're encouraged by the inflection points that we have seen and the improvement in trends in France and in the US particularly, and the earlier ones, it's too early for us to call a broad-based recovery is in motion. Certainly, over the last couple of quarters, we've had some positive signs. And as you can tell from our guide, we expect those trends to continue into the first quarter. On the second part of your question around flexibility, maybe Becky, you could give some insights into what you've heard from clients and some of the work that we've been doing. Over to you.

Thanks, Andrew. You know, it's a timely question because we're just off of two weeks in Europe spending time with our markets as well as spending time with our clients and partners. The World Economic Forum. And just as you said, the chatter around flexibility is increasing. And, you know, for us, that's good for our business because it's one of the prime core propositions that we offer is flexibility. And so we're seeing that in the short term as well as over the long term. You know, all the research I've done around the strategy indicates that candidates want more flexibility and clients want more flexibility. And so we anticipate this is good for today, it's also gonna be good for us in the future. So the chatter is starting. We're not seeing all that flow through in volume yet, but it starts with conversation.

Thanks, Becky.

Thank you. Our next question comes from Kartik Mehta with Northcoast Research. Your line is open.

Hi, good morning. Jack, I think you said enterprise demand is helping at least stabilize the revenue. And I'm wondering, as enterprise revenue grows, what that means for margins, maybe even cash conversion, and kind of what you think by revenue durability for the business.

Sure, Kartik. Hey, happy to talk about that. So you're right. And that has been the trend we've seen in the second half of the year. The enterprise client has been the lion's share of the demand, and we've seen the mix impact on the GP margin. Now with that being said, most of that has worked its way through. If you look at the third quarter, that's really when we signaled the shift weighted in a bit more. And from the third quarter to the fourth quarter, it's really been quite stable. So you see in the GP margin bridge on the staffing side, it's down that same 40 basis points year over year from Q3 again in Q4. So that is signaling that a lot of that enterprise shift has worked its way through. And I'd say with that, you know, pricing remains very rational. That indicates that, you know, we are, it's always competitive, but pricing is not changing. And that is not having the impact. It's really just that averaging impact on the enterprise client. With that being said, you mentioned a couple of other things. What impact is that going to have on the balance sheet and cash? So, and I would say, you know, that is part of the equation. We did see DSO tick up a bit. We do know enterprise clients traditionally have a bit longer payment terms on average. And, you know, that's again, I'd say that's worked its way through in the numbers. With that being said, we're very focused on that. We have actions in place to continue to mitigate that. And we expect ongoing progress in that in 2026. And then lastly, I'd say, you know, the other part of the enterprise component is, you know, that does create some timing in terms of the cash flows. And we saw that with, you know, perhaps some lighter cash flow in the third quarter year over year, but a really good fourth quarter cash flow result as a lot of those enterprise client payment terms came in during the fourth quarter, really driving a pretty strong fourth quarter free cash flow result for us on an overall basis. So it's all part of the balancing equation between enterprise and non-enterprise on an overall basis. We have actions in place to mitigate that, you know, the DSO that I mentioned, and we do expect ongoing improvement as we go forward here in 2026.

Thank you. Appreciate it.

Thank you. Our next question comes from Trevor Romeo with William Blair. Your line is open.

Good morning. Thank you for taking the questions. I wanted to, I guess, focus on some of the commentary on near-term demand. I think you noted some improvements throughout the quarter in some of your key markets. So I was just wondering if you could maybe provide some more color or Jack, if you could maybe quantify how the revenue trends progressed on a monthly basis in, you know, maybe France, Italy, US, maybe UK, and any color on what you're seeing so far in January if you have it. Thanks.

Thanks, Trevor. I'd be happy to add a little color there. I'd say generally, we're seeing positive momentum in a lot of our large markets. And maybe to your point, starting with France, improvement over the last four months sequentially month over month. So we ended September on a days adjusted basis at minus four, improved slightly into October, moved to minus three in November, and ended December minus two. So very good progress sequentially. And as we sit here in January, we're seeing ongoing progress here, and that aligns with the guide that I gave for the first quarter. So that is, you know, ongoing quarter over quarter improvement in France. And that's great to see for us. And so that's our biggest country, and that's a big driver. I would say if we look at the US, you know, we've been very, you know, we've discussed the trends in Manpower very frequently this year. Very strong. We're performing really, really well. So they've been running plus seven, plus 8% in the second half of the year. We take that momentum into the first quarter. I think on US overall, on an underlying basis, very stable from Q4 to Q1. I say underlying because we know the healthcare go-lives in the Experis business, as I mentioned in prepared remarks, can be a bit lumpy. But if you normalize for that, the US is trending on a stable position into Q1. And then Italy, as we mentioned, as Jonas mentioned, performing very, very strong. And I'd say on those trends, Italy, very strong sequential quarter trends as we end the year here. And I'd say we saw that generally December is always a little bit of a tricky month just based on the holidays and so forth. But I'd say on an overall basis, Italy is continuing to see very strong momentum, particularly here in January. So moving, you know, we're at that plus 7% base adjusted in Q4. And we feel really good, as I mentioned, for a similar trend into Q1. So I'd say those are the biggest countries and some of the momentum. But as I mentioned, I'd say generally, moving in line with positive trends as we start 2026.

Got it. Thank you, Jack.

Thank you. Our next question comes from Jeff Silber with BMO Capital Markets. Your line is open.

Thank you so much. Jonas, I think in one of the answers to the previous questions, you talked about being able to control what you can control. I'm just curious, are you expanding your workforce in any regions? Or because of the technology you put in, you're still able to have, you know, some excess capacity.

Good morning, Jeff. Yeah. We are expanding more so thinking about this from a regional perspective. We're thinking about it from a country perspective. And there are definitely countries where we're expanding our teams, and it's mostly in demand-driving roles. So when you think about the growth that we're seeing in Japan, if we're thinking about the growth we're seeing in Italy, we're leaning into and we're expanding our team members there, especially in demand-driving roles. And we continue to bring great tools through the PowerSuite to our recruiters. And we are seeing, as I mentioned in my prepared remarks, some notable productivity improvement, for instance, on our candidate screening capabilities. And one of the huge advantages that we believe we are uniquely positioned to take advantage of is our global scale of PowerSuite. So we have a global technology infrastructure, modern and a global data asset that we are leveraging for faster expansion of recruiter tools that drive better productivity and enhance the client and candidate experience. So the answer to that is yes. We adjust capacity to demand, and in some cases, in some countries, that means we're leaning into demand-generating roles. In others, we are pulling back so that we ensure we protect our ability to deliver the bottom line margins that we're targeting.

Alright. Great. Thanks for the color.

Thanks, Jeff.

Thank you. Our next question comes from Ronan Kennedy on behalf of Manav Patnaik with Barclays. Your line is open.

Hi, good morning. This is Ronan Kennedy on for Manav. Thank you for taking our questions. Could you please reconfirm? I know you talked about what you're seeing associates on assignments in key markets, the positive trends in the US and France, etcetera. Could you please reconfirm other leading indicators to be mindful of that give insight to potential depths and breadth of the demand dynamics, and then what we could or should potentially look for to see to enable to call a broad-based recovery, whether that's, you know, new assignment starts and priority verticals or even fundamental client conversations. What we could look for for that broad-based recovery confirmation.

Thanks, Ronan. Well, there are a number of indicators that we look at from, you know, demand perspective. And, you know, you can take anything from the conversations that Becky referenced. You know, we are hearing more clients express a desire to start to think about through our various brands about projects that they have held back and are now getting closer to activating. As Becky said, we're not seeing the activation yet, but the number of conversations with clients and employers seems to indicate that they are looking forward with greater confidence and that their plans are getting closer to being executed. So we then look at, of course, the flow of demand in terms of RFPs and RFIs that would come our way. And clearly, what we've been very successful at is targeting the verticals, the industry verticals that we feel good about for growth at this point versus others that we notice that we see have, you know, headwinds. So we feel, for instance, that the aerospace and defense sector could give us some tremendous opportunity across Europe. We have strong positions in a number of our very strong countries such as France, the UK, Sweden, and Italy. So we're very well positioned there. We feel good about that opportunity. So that's how we're sort of thinking about both looking at the moves within industry sectors as well as the client conversations within those sectors or verticals and then in other areas as well. And frankly, you know, when we'll know the broad-based recovery when you see these inflection points coming through in lots of our countries. But as we mentioned in our prepared remarks, we've been very encouraged by the overall trend in a number of our important markets. We continue to do very well in Asia Pacific as well as in Latin America. In fact, Asia Pacific broke an all-time profitability record in 2025. Latin America continues to perform very well. We have market-leading positions in 13 countries in that important region. So we're encouraged by what we're seeing. But we're not fully there yet from a broad-based recovery. But we are controlling what we can control, driving growth where we see demand, and adjusting our cost and capacity to demand in markets that remain more difficult.

Thank you. Appreciate it. And as a follow-up to having spent two weeks in Europe around the World Economic Forum, are there any implications of potential political sentiment shift from Europe towards the US or any shifts in trade alliances as a result of US ambitions in the continent and the general approach that was taken at Davos? Could these developments have implications for some of the momentum you are seeing in Europe? Or the shape of recovery inflection or general time required for stabilization where it hasn't come yet?

You know, we clearly are living in a turbulent environment, but I have to say from what we're seeing from our clients and from our business, at this point, this is not impacting our business. And to Becky's earlier point on flexibility, if anything, employers are becoming more confident about the future. Against the backdrop of greater turbulence, flexibility is key for them to find the right talent and be able to adjust, you know, with various kinds of skill sets. So we actually think, you know, this so far has not really impacted our business based on the trends that we're seeing. And we're now used as employers and organizations to a more fluctuating geopolitical environment, and companies at some point have to decide to manage through it and get on with the business of doing business. And that's what we're seeing, I think, in a lot of countries.

Thank you. Appreciate it. And may I just sneak in one more? Could I ask for your broad, high-level characterization of the labor and hiring markets? I think previously, it was frozen. Is it thawing now, or how would you characterize it?

I would say that the labor market is stabilizing, and, you know, we think the broader labor market, if you're referring to the US, is heading to stabilization. Thank you very much.

Thank you. Our next question comes from Josh Chan with UBS. Your line is open.

Hi, good morning. Thanks for taking my question. I just have a two-part question on margins. So for SG&A leverage, it seems like your momentum is picking up quite nicely there. So could you talk to what's driving that in the last two quarters and where SG&A leverage could potentially go? And then I guess number two is on the gross margin line. You know, a lot of this call has been about stabilization, but that's sort of the one line that has not yet stabilized. So do you have any thoughts on whether gross margin will stabilize as the demand environment does the same? Thanks for any color there.

Okay. Thanks, Josh. I think on the SG&A, it's pretty straightforward, and thank you for your comments there. So we are very proud of the actions we've taken and the results we're seeing in the SG&A coming down 4% in constant currency in the fourth quarter. And it's to your point, that's an improvement from the 2% constant currency decline in the third quarter. So, you know, we've done a lot of work. We've taken a lot of actions earlier in the year, and we're seeing the benefits of that hard work coming through in the run rate now. And that is going into our continued trajectory into Q1 as well as we continue to see the benefit of those actions. And, you know, we've talked previously about, you know, the restructuring we've taken. A lot of that in Northern Europe. And, as we mentioned on the call and you saw in our results, Northern Europe flipped to a profit in the quarter. So, you know, based on the work we've done earlier in the year, we are actually helping to improve the seeing the benefits of those actions, helping to improve the profitability of Northern Europe as we end the year. So those are the main items that are driving that. Continue to be more stable. And, you know, in parts of the business that are still recovering, we're holding the line on cost, and that's coming through in the run rate. Your question on GP margin, I would say it really to your point, it has come down over the course of the year. But that's that enterprise element that we've talked about. And as enterprise demand continues to be the biggest part of demand in the current environment, that's averaged in. And to my earlier points, a lot of that has worked its way through, Josh. So you see that on the staffing margin progression from Q3 to Q4 being pretty stable year over year. But the bigger part of the story on an overall basis is perm. Perm is lower, and perm will come back in the future, but it's at historically low levels of a percentage total GP for us right now. And that's depressing the GP margin on an overall basis. So when perm starts to rebound, we'll see an opportunity for GP margin to increase. And we also will see opportunities for that as the higher margin businesses inflect in the future and start to average in at a higher percentage of the mix as well. So and convenience will come back going forward as well. So we have some really good opportunities as you know, right now, is the strongest part of demand, and that's been holding very steady. But as the other components start to come back and they usually follow enterprise, enterprise usually leads. That will be opportunities for us to increase GP margin in the future.

Great. Thank you for that color, Jack. I appreciate that.

Thank you. Our next question comes from Andrew Grobler with BNP Paribas. Your line is open.

Hi, good morning. Just the one from me around technology. With the IT sector still down quite sharply in the US, what are you seeing in those end markets? I noted one of your competitors was talking about improvement in late 2025 and into this year. Is that something that you are also seeing? And if so, what can we expect through the remainder of this year? Thank you very much.

Yeah. Good morning, Andy. Yeah. We're, as we mentioned in our prepared remarks, we've seen sequential improvements in Experis, although still experiencing headwinds. We're encouraged by that. I would say that in conversations with our clients, you know, they've been very focused on a number of areas, and specifically within the technology sector, the very strong hiring that occurred during the pandemic caused a hiring bubble, and they've been working their way through that. And they've been focused on projects primarily related to AI. But with our clients, we are hearing that their pent-up project demand is getting closer to being executed. We haven't seen this come through yet, but we're encouraged by those conversations, and we would expect to see that, you know, the sequential improvements that we've seen in Experis continue. We would characterize it as stable into Q1. But overall, our clients are telling us that we want to proceed with the other technology investments and the projects that we need to do. And overall, I would say, you know, we've seen a very nice evolution around data and infrastructure projects where, you know, we were having to shift a bit into those areas. And then with our AI tools that are starting to give us, you know, confidence both consulting with our clients on how they can access AI and use AI in their own work and how we are providing solutions to our clients that resonate. We are faster, efficient, better quality, more cost-effective, which is also differentiating us. So long term, we feel very good about the trajectory that we have in Experis, acknowledging the headwinds, acknowledging that we still have a lot of work to do, but we think that we'll continue to see the progress going forward.

Thank you very much.

Thank you. Our next question comes from Tobey Sommer with Truist.

Wanted to ask you a follow-up question on your comments about the 4.5% EBITDA margin goal longer term and that commitment. Could you talk to us in broad strokes, whether it's about top line, gross margins, or, you know, mix that may be required from the higher margin sources of revenue, how much do those have to rebound? Do they have to go back to prior peaks, or is it sort of more normalized levels to think about that long-term EBITDA margin goal? Thanks.

Yeah, Toby, I'd be happy to talk to that. So I think the way to think about it, and that is definitely part of the equation, right? So if you look at where we're ending 2025, so at 2.1% margin, you know, our previous peak was 4.1. And if we look at the mix of the businesses, what we've seen with the 5% Manpower growth in the quarter, Manpower certainly has been averaging in as a bigger part of the GP mix. And as the environment continues to recover, that will start to change. We'll start to see Experis and Talent Solutions start to average back in at a higher contribution. That in itself is going to be a positive. And we were just talking a little bit about this on the GP margin. That in itself will be a very positive impact on the overall consolidated GP margin. And we do expect that to happen. As Jonas said, we don't know the exact timing of that. Those parts, you know, permanent and professional have been more sluggish. But we are starting to see some signs that, you know, on the stabilization, there's opportunities for improvement here as we walk into 2026. So we will need that to happen. That will be important as we look at the overall GP margin component as getting back to where we were from a mix perspective. And that will be quite significant. And then, you know, just forget, you know, aside from just the brands, as we mentioned, just even within all the brands, as we see convenience come back, that will be a positive for the GP margin. So that's definitely part of the equation. As I mentioned previously, I think all the work we're doing structurally on cost is a big part of the equation. So as we see EBITDA, as we see that GP margin improvement fall down to the EBITDA line, combined with the cost improvement, those two items together will be big drivers for that EBITDA margin progression to the 4.5%. And as I said, hey, if the recovery is stronger and we start to see professional and RPO and perm come back stronger, it'll be faster. We'll see more help on the GP line. We'll get more operational leverage. But even in a modest recovery, as those, you know, as those sectors come back, that will be positive for both GP and EBITDA margin. So it's really just a question of, you know, the pace of when those other sectors start to come back. But it is encouraging that we're seeing Manpower now growing at 5% as we end 2025. And so that's a very good initial sign.

Thank you, Jack.

Thank you. Our next question comes from Harold Anter with Jefferies. Your line is open.

Hello. This is Harold Anter on for Stephanie Moore. I guess, just on AI just real quick. I guess, you know, could you provide your long-term views on the impact of blue-collar versus white-collar staffing? And then, I guess, are you hearing clients talk about the need to hire people who can use AI? But they focus on just training their current staff to use the technology. And I guess the last thing is do you expect to see long-term pricing to be pressured in the future as clients request to share in the productivity benefits gained from AI. Thank you.

Alright, Harold. We'll try and cover that's four questions in one. So here it comes. You know, first of all, let's be clear that we think that AI has tremendous opportunity for growth and productivity improvement generally, but specifically to our business. And that's what we are preparing for, and that's what we have been preparing for as we are creating more growth opportunities in terms of addressing how we're setting ourselves up for growth. In the research that Becky has done, we've looked at some of the, you know, the AI resiliency, and I mentioned this in my prepared remarks that there are a lot of skill sets that we have in Manpower that appear to be more resilient and that we're seeing in the other skill sets, white-collar, the emergence of some greater use of AI, and frankly, mostly enhancing human capabilities as opposed to replacing them. But I think, from a usage perspective, Becky, as we look at what we talk to our clients about and how they see it, in terms of where they're using AI, I think that could be great color. And then also, maybe talk a little bit about the work that we have done on SoFi.ai and how that is resonating with our clients as well.

Yeah. Thanks, Jonas. First, I would say I've spent a lot of time focused on AI over the last few months trying to understand what it can do today, but maybe more importantly, what it will grow up into tomorrow. And it is true that AI will impact most jobs, most skills inside most jobs. The difference, it'll be the varying degrees, and I think that was part of your question. What we found is that for blue-collar industrial manufacturing roles, they appear to be more resilient over the horizon where the disruption is happening more in the white-collar software developers and coders as we've already seen in demand. You know, keep in mind, though, that in the US, software developers are still the number three job in demand in our country. So even though it's impacted, it's still a huge in-demand role. We've also seen impact in call center professionals. And the good news for our business is we have limited exposure there, so we have an opportunity to actually find opportunity in this changing landscape. And a highlight of that is what Jonas mentioned with Experis, and us getting into these coding assistance to provide value in that incremental growth pocket for us as a company. Small, early days, but we think that's an opportunity. In terms of SoFi, Jonas mentioned SoFi.ai, just to remind everyone, it's our proprietary AI ecosystem. Ecosystem. So it's built on our PowerSuite foundation. It's why that foundation is so important. And it's designed to integrate human expertise, our proprietary data, as well as leading-edge AI models. And probably one specific example that I'm encouraged by is a pilot we're doing around workforce insights. So that we're providing real-time AI agents available twenty-four seven to give accurate labor market insights. It's 10x faster than anything we could do with humans alone, it is augmenting humans. It's 99% accurate, and it has self-correcting capabilities. So if something is off, it will alert us. And so those are the kind of actions we're taking to find profitable growth opportunities in the changing landscape.

And then to your last part of the question, Harold, you asked about, you know, we're seeing an impact on this from a pricing perspective in taking a share? And, you know, whilst it is early days, most of our enhanced AI capabilities are coming through with higher value offerings and differentiated innovation. So we're actually seeing opportunities for us to deliver higher value work and actually maintaining, if not increasing, our margin opportunities on those offerings. So so far, we have not seen this. And the indications are positive to the reverse, but this may change as time goes on.

Thank you. This concludes the question and answer session. I'd like to turn the call back over to Jonas Prising for closing remarks.

Thanks, Michelle, and thanks, everyone, for joining us this morning for our Q4 earnings call. We look forward to speaking with all of you again on our Q1 earnings call sometime later in April. Until then, stay warm. Greetings from the frozen tundra in Milwaukee. We look forward to speaking with you on our next call. Thanks, everyone.

Thank you for your participation. You may now disconnect. Everyone, have a great day.