Kelly Services, Inc.

Good morning and welcome to Kelly Services' third quarter 2026 earnings conference call. All parties will be on listen only until the question and answer portion of the presentation. Today's call is being recorded at the request of Kelly Services. If anyone has any objections, you may disconnect at this time. I would now like to turn the meeting over to your host, Mr. Scott Thomas, Kelly's Vice President of Corporate Affairs. Please go ahead.

Good morning and welcome to Kelly's third quarter conference call. With me today are Kelly's Chief Executive Officer, Chris Layden, and our Chief Financial Officer, Troy Anderson. Before we begin, I'll remind you that the comments made during today's call, including the Q&A session, may include forward-looking statements about our expectations for future performance. Actual results could differ materially from those suggested by our comments. We do not assume any obligation to update the statements made on this call. Please refer to our SEC filings for a description of the risk factors that could influence the company's actual future performance. In addition, we'll discuss certain data on a reported and on an adjusted basis. Discussion of items on an adjusted basis are non-GAAP financial measures designed to give insight into certain trends in our operations. For more information regarding non-GAAP measures and other required disclosures, please refer to our earnings press release, presentation, and once filed, Form 10Q, all of which can be accessed through our investor relations website at ir.kelleyservices.com. With that, I'll turn the call over to Chris.

Thank you, Scott, and good morning, everyone. It's great to be with all of you. In the third quarter, we delivered another solid performance while advancing our strategic initiatives and positioning the company for the future. Revenue came in above the midpoint of our guidance. and adjusted EBITDA margin was at the top end of our expected range. Our overall performance was driven by continued momentum in ETM and SET, reflecting our ongoing focus on improving our execution and the progress we've made positioning the business to capitalize as the early stages of recovery take shape. This was somewhat offset by near-term demand dynamics in education, which I'll discuss shortly. Let me first start with ETM, which delivered positive year-over-year revenue growth for the first time since the segment was established. Staffing performed well in the period, capitalizing on increasing demand for industrial talent. Growth in talent solutions was also strong, led by double-digit gains in MSP and RPO as new programs continue to ramp. Across ETM, we continue to drive new business wins as we capitalize on demand from enterprise clients across pharmaceuticals, energy, and logistics. Our technology-enabled and AI-powered capabilities remain a clear differentiator in these pursuits. This is among the reasons why Kelly was once again recognized by Everest Group as a global leader in its 2026 peak matrix for both MSP and RPO and by HRO today as the number one global provider of total workforce solutions. We also continue to deepen our relationships within existing accounts as our growth office champions our one Kelly approach to meeting the evolving needs of our clients. Notably, we recently renewed and expanded our global MSD program with one of our largest clients, a leading semiconductor manufacturer that has partnered with Kelly for nearly 40 years. Our relationship has continued to grow globally across our lines of business as they capitalize on the digital infrastructure build-out. The depth of this relationship reflects the trust our largest clients place in Kelly to support their workforce needs wherever they operate and the confidence they have in our technology-enabled and AI-powered offerings. Turning to SET, we maintained our momentum as revenue grew on a sequential basis for the second consecutive quarter. This improvement was led by our higher margin solutions business, which outperformed in the period, representing 40% of SET's revenue. Within the specialties, we saw growing demand for outcome-based solutions in engineering among aerospace, pharmaceutical manufacturing, and advanced mobility clients. And in life sciences, we delivered another quarter of year-over-year revenue growth as we continue to capture demand for our differentiated functional service provider solution. Industrial reshoring drove activity across key technology and advanced manufacturing verticals as well this quarter, leading to the addition of new clients and the expansion of existing business. Another example of how our One Kelly approach positions us to grow with our existing clients is our relationship with one of the world's largest IT infrastructure services providers. What began as a small number of specialized IT staffing placements to our technology business has grown into a multinational solutions-based engagement spanning staffing and statement of work delivery. The scope now includes advanced software development and cloud architecture projects, as well as support of the client's expansion into new offerings, including the build-out of a cutting-edge AI innovation center, which launched last month. Today, this relationship spans our technology, digital infrastructure, and industrial specialties, with Kelly OCG's global capabilities extending our support outside of the US. From one line of business to four, from domestic to multinational, this is our One Kelly strategy in action. Finally, in education, our results reflect two distinct dynamics. First is near-term enrollment pressure, in some K-12 districts, which became more visible as we began a new school year in the quarter. In districts where enrollment has declined, schools are consolidating into fewer larger classrooms, or in some cases, closing altogether. Fewer classrooms have contributed to lower than expected demand for substitute teachers, despite the strong selling cycle we concluded in the second quarter. Second is a highly fragmented market in therapy. where demand for PTOT and speech therapy professionals remain solid, but we have not yet captured it at the pace we expect. To better position Kelly to capitalize on this opportunity, we're taking swift action to align resources with our growth priorities. This includes shifting capacity to where demand is strongest, ensuring the right team structure is in place to best identify and convert those opportunities to wins, and optimizing our processes to accelerate fulfillment. Together, these dynamics are contributing to a more gradual pivot back to growth within education. But we expect they'll strengthen the case for Kelly over the long term, as districts facing persistent talent shortages and larger class sizes increasingly turn to a partner who can bring new sources of talent into the classroom. As the largest provider of education workforce solutions in the U.S., and with industry-leading fill rates, We remain well positioned to capture that opportunity. Our conviction in this market remains strong as we execute through this transitional period. As we focus on delivering near-term results in the quarter, we also drove meaningful progress on our strategic priorities, which are positioning Kelly for the future. Across each of our segments, we continue to transform how we go to market to raise our visibility and to make it easier to do business with Kelly. In October, We launched a refreshed brand architecture, a direct response to what we've heard from our clients about how they want to engage with us. We're bringing all of our brands together under one Kelly, organized into 10 specialties and offering a full suite of differentiated capabilities for individual placements to outsourcing, consulting, and talent solutions. We've included a supplement in today's presentation that illustrates how the 10 specialties map to our existing segment structure. We announced one of those specialties, Kelly Digital Infrastructure, in September, bringing together Kelly Telecom, NextGen GTA, and Motion Telco under a single brand. This builds on our 20 years of experience in the space to serve growing demand from AI and the broader digital infrastructure build-out. It's the final stage of integrating our legacy acquisitions. We've already brought these teams together organizationally, and now the way they go to market reflects it as well. We're backing all of this with ongoing investment in technology. Last month marked another significant milestone in our technology modernization journey. We established Workday as our enterprise human capital management platform and cut over a significant portion of our back office processes onto a single enterprise scale instance. Later phases of this key initiative will modernize our remaining back office and ancillary systems across the rest of the business. positioning us to operate with greater efficiency and better data as we scale our one Kelly strategy. Our AI initiatives are also becoming more deeply integrated across the organization and helping our team move faster while improving the client and talent experience. For recruiters, we remain focused on automating transactional work through our proprietary internal AI platform, Grace Boost, so they can spend more of their time on the parts of the job only a person can do. This is important because job seekers are looking for a more personalized experience. They want an advocate who can offer tailored guidance to help them navigate a rapidly changing and increasingly unfamiliar job market. Our approach to AI enables that experience matching job seekers to the right opportunity faster while the recruiter with specialized domain expertise guides their job search from start to finish. Simply put, Humans lead the process and AI elevates it. No matter how a candidate reaches us, through a branch, an MSP program, or our AI recruiting agent, every hiring decision is made by a member of our team. Overall, I'm pleased with the progress we delivered in the third quarter. Our momentum with an ETM instead is growing. We're accelerating conversion of our new business pipeline while building deeper relationships with our largest clients. and the investments we're making in our brand, technology and AI are positioning Kelly for the future. With that, I'll turn the call over to Troy to talk through the quarter in more detail and our expectations for the balance of the year. Troy.