Adecco Group Q3 2024 revenue drops 5% amid challenging markets
ZURICH, SWITZERLAND—The Adecco Group, the world’s second-largest human resources provider and temporary staffing firm, recently released its Q3 2024 results. The company reported revenues of €5.7 billion (US$6.06 billion), a 5% year-on-year decline on an organic trading days adjusted (TDA) basis.
Challenging conditions in key markets such as France and the United States primarily drove the revenue drop. However, regions like Asia and Iberia (Spain and Portugal) performed more positively.
CEO Denis Machuel commented on the results, stating, “We continue to successfully deliver on our Simplify, Execute, Grow plan, and third-quarter performance was robust against a high comparison base.”
He also noted that volume trends have stabilized despite the macroeconomic environment remaining difficult.
Gross margin remains stable despite lower volumes
The company maintained a gross margin of 19.4% despite an 8% year-on-year decline in gross profit to €1.1 billion (US$1.16 billion). This stability reflects Adecco’s ability to enforce firm pricing and manage its cost structure effectively despite lower volumes.
Selling, general, and administrative (SG&A) expenses were reduced by 5% year-on-year to €925 million (US$983 million), contributing to the company’s cost-saving efforts.
EBITA and net income see declines
EBITA (earnings before interest, taxes, and amortization), excluding one-off costs, came in at €186 million (US$197 million), a significant 20% year-on-year decline in constant currency terms. The EBITA margin dropped to 3.3%, down from 4.0% in Q3 2023.
Adecco attributed this decline to lower volumes and limited operating leverage but highlighted strong savings in general and administrative costs.
Net income for the quarter was €99 million (US$105 million), down slightly by 4% compared to Q3 2023. Basic earnings per share (EPS) fell to €0.59 (US$0.63) from €0.62 (US$0.66) in the same period last year.
AI integration and cost savings drive future growth
Adecco continues to focus on its Simplify-Execute-Grow strategy, prioritizing cost efficiency and digital transformation initiatives. The company has accelerated its adoption of artificial intelligence (AI) and expanded global delivery services to improve recruiter productivity and time-to-fill rates for clients.
Machuel expressed optimism about the future: “We remain focused on capturing market share, building on strong progress over the last two years.”
Adecco has also lifted its G&A savings run-rate target for year-end to €171 million (US$181 million).
Outlook for Q4 remains cautious
Looking ahead, Adecco expects revenue trends for Q4 2024 to remain similar to those of Q3. The company plans to continue focusing on cost-saving measures while maintaining sales capacity.
Additionally, Adecco anticipates that its net debt levels at year-end will remain comparable to those of the previous year.
