What Management Said
Read the full Q1 2026 transcript ↗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. Our Q1 results reflect disciplined execution and continued stabilization of revenue trends across key markets. In the Q1, we delivered reported revenues of $4.5 billion, representing an organic constant currency growth of 3%. System-wide revenue, which includes our expanding franchise revenue base, was $5 billion.
Adjusted EBITDA margin of 1.4% reflects improving demand trends as well as P&L leverage. We're also encouraged that top-line growth exceeded our expectations, reflecting strong execution of our commercial initiatives. We are expanding our new business pipeline, increasing client engagement, and continuing to win in the areas where growth is strongest and most resilient. During Q1, we reduced SG&A, as adjusted, by 4% in constant currency while delivering continued top-line growth, reflecting the impact of our ongoing efficiency efforts.
This is supported by improving business confidence in the U.S., as evidenced by the increase in CEO Confidence reported by the Conference Board, rising manufacturing PMI in the U.S. As conditions improve, we expect sustainable organic revenue growth to build progressively. We are transforming our business model to drive growth and expand margins over time. The goal is clear: connect more people to work by filling more orders to drive growth while structurally lowering our cost to serve.
What went well
- Reported revenue of $4.5 billion grew 3% on an organic constant currency basis, exceeding the midpoint guidance of 1% growth, with system-wide revenue including franchises reaching $5 billion.
- The Manpower brand delivered strong organic constant currency growth of 6% in the quarter, up sequentially from 5% in Q4, marking seven consecutive quarters of growth in the U.S. and four globally.
- Adjusted EBITDA was $61 million, a 5% increase in constant currency year over year, with adjusted EBITDA margin of 1.4%, up 10 basis points year over year and at the midpoint of guidance.
- Management announced a strategic global transformation program expected to deliver $200 million in permanent cost savings in 2028, extending the back-office redesign into the front office.
- SG&A as adjusted was reduced 4% in constant currency while delivering top-line growth, and Italy grew 8%, APME grew 8%, and Japan grew 4% on a days adjusted constant currency basis.
What went wrong
- Gross profit margin came in at 16%, below the low end of guidance, driven by lower bench utilization in Europe and mix shifts impacting staffing margin (a 70 basis point staffing reduction).
- The Experis brand declined 9% on an organic constant currency basis, with Experis U.S. down 15% days adjusted as it anniversaried strong prior-year healthcare IT project volumes.
- The Talent Solutions RPO business continued to experience a sluggish permanent hiring environment, though it saw sequential trend improvement.
- U.S. revenue declined 5% on a days adjusted basis, partly impacted by extreme weather which management estimated was about a 1% drag.
Guidance Changes
| Metric | Period | Current guidance |
|---|---|---|
| Organic days adjusted constant currency revenue | Q2 2026 | strengthening from Q1 (reiterated growth trajectory as bench headwinds ease into Q2) |
| U.S. revenue | Q2 2026 | low single-digit percentage growth (raised, expected to flip to growth on improved Experis trend) |
| Transformation cost savings | 2028 | $200 million permanent run-rate savings (raised via addition of front-office transformation) |
| Restructuring and transformation charges | remaining quarters 2026 | $10 million to $15 million on average per quarter (lowered from Q1 run rate) |
| France revenue | Q2 2026 | flat to slight growth (reiterated improving trend) |
| Italy revenue | Q2 2026 | mid-single digit percentage growth (reiterated solid growth) |
Performance Breakdown
| Metric | YoY | Note |
|---|---|---|
| Total revenue (organic constant currency) | +3% | disciplined execution, stabilizing demand, strong Manpower performance in France, U.S., and Italy |
| Manpower brand (organic constant currency) | +6% | broad-based manufacturing sector momentum across U.S., Italy, and Spain |
| Experis brand (organic constant currency) | -9% | timing of healthcare IT projects in the U.S. against strong prior-year comparisons |
| Talent Solutions brand (organic constant currency) | -1% | improved from Q4 decline of 4% as RPO decline narrowed, MSP grew, and Right Management grew |
| Adjusted EBITDA | +5% constant currency | cost discipline and P&L leverage lifting margin to 1.4%, up 10 basis points |
| Adjusted EPS | $0.51 | came in just above guidance midpoint of $0.50 |
| Americas segment revenue (constant currency) | +4% | growth partially offset by U.S. days adjusted decline |
| Southern Europe revenue (constant currency) | +3% | strength in Italy at 8% and France returning to flat |
| APME segment revenue (constant currency) | +8% | consistent performance with Japan up 4% |
Earnings Call Themes & Trends
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Global transformation and cost savings | Q4: front-office transformation being planned for North America, back-office progressing | Q1: formal $200 million savings program launched with a dedicated chief enterprise transformation officer hired; front office started in North America | — |
| AI monetization | Q4: AI Recruiter Toolkit scaled to 12+ markets, 7% placement rate lift | Q1: France AI sales engine generated about $200 million incremental revenue; SoundHound and Hubert.ai partnerships; 25,000 AI interviews with 67% screening time reduction | — |
| European manufacturing environment | Q4: stabilization led by enterprise demand, Italy and Spain inflecting | Q1: manufacturing strengthening, PMI above 50 across major markets, aerospace and defense a growth area | — |
Q&A Summary
Would you call the Manpower business in recovery mode leaning toward acceleration, or at a point of stable growth?
Management is pleased with improving momentum and saw acceleration from Q4 into Q1, citing seven quarters of U.S. growth and four globally, though it is now anniversarying strong prior-year growth.
Is uncertainty around AI pushing companies toward more flexible labor solutions, aiding Manpower growth?
For Manpower, AI is not really a factor because the business is resilient to AI impact; client hesitation is tied more to geopolitical events, tariffs, and wars than AI concerns.
Can you give more color on the transformation savings by geographic region and timing?
Initial back-office savings come from Europe where processes started first; front-office savings begin in North America in 2027 with the rest of the world following in 2028.
On gross margin, how much of the staffing pressure is enterprise mix versus pricing?
Perm stabilized and improved sequentially, so the driver was an outsized Q1 bench utilization impact (roughly 10 to 20 basis points of headwind) plus strong enterprise mix; pricing remains rational, so it is a timing and seasonality issue not structural.
How should investors think about a reasonable 2028 EBITDA margin from this program?
The full $200 million is expected in 2028; applying it to the last four quarters adds about 110 basis points to EBITDA margin in isolation, on top of roughly 2% currently, with additional operational leverage possible on recovery.
Can you provide country-specific detail on the improving manufacturing landscape?
PMI is improving across the U.S. and Europe; aerospace and defense is strong especially in Europe, while automotive and logistics remain weak; Manpower grew 5% in the U.S. (about 6% ex-weather), 8% in Italy, and double digits in Spain.
How scalable is the $200 million France AI revenue globally and what is the margin implication?
The AI sales targeting engine will scale to roughly 50% of markets by year-end; early deals show encouraging margin potential but it remains early days.
On the Experis U.S. environment, what are you seeing?
Tech clients are cautious on AI spend, but the Experis pipeline grew in healthcare and life sciences, and the SoundHound partnership turns AI into a tailwind by selling agents-plus-humans products; Q2 Experis revenue is expected close to flat.
What is actually being saved, and why would front-office savings exceed back office?
Savings come from centralizing work into global business service hubs and infusing automation and agentic AI; front-office functions (recruiting, sales, service delivery) are larger populations than back office, driving bigger savings.
More on ManpowerGroup Inc.
Reported 2026-04-16 · figures from the ManpowerGroup Inc. Q1 2026 earnings call.
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