DHI Group, Inc.

Good afternoon, everyone, and welcome to the DHI Group Inc. 3rd Quarter 2025 Financial Results Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star and then one on your touch-tone telephones. To draw your questions, you may press star and two. Please also note today's event is being recorded. At this time, I'd like to turn the floor over to Todd Curley with Pondell Wilkinson. Please go ahead.

Thank you, Operator. Good afternoon, and welcome to DHI Group's third quarter earnings conference call for 2025. Joining me today are DHI's CEO, Art Zailey, and CFO, Greg Skippers. Before I hand the call over to Art, I'd like to address a few quick items. This afternoon, DHI issued a press release announcing its financial results for the third quarter of 2025. The release is available on the company's website at dhigroupinc.com. This call is being broadcast live over the internet for all interested parties, and the webcast will be archived on the investor relations page of the company's website. I want to remind everyone that during today's call, management will make forward-looking statements that involve risks and uncertainties. Please note that except for the historical information, statements on today's call may constitute forward-looking statements within the meaning of the federal securities laws. These forward-looking statements reflect DHI management's current views concerning future events and financial performance and are subject to risks and uncertainties, and actual results may differ materially from the outcomes contained in any forward-looking statements. Factors that could cause these forward-looking statements to differ from actual results include the risks and uncertainties discussed in the company's periodic reports on Form 10-K and 10-Q and other filings with the Securities and Exchange Commission. DHI undertakes no obligation to update or revise any forward-looking statements. Lastly, on today's call, management will reference specific financial measures, including adjusted EBITDA, adjusted EBITDA margin, free cash flow, and non-GAAP earnings per share, which are not prepared in accordance with U.S. GAAP. Information regarding these non-GAAP measures and reconciliations to the most directly comparable GAAP measures are available in our earnings release, which can be found on our website at dhigroupinc.com in the Investor Relations section. With that, I'll now turn the call over to Art Zaley, CEO of DHI Group.

Thank you, Todd. Good afternoon, everyone, and thank you for joining us today. I'm Art Zailey, CEO of DHI Group, and with me is Greg Skippers, our CFO. If you're new to the story, welcome. At DHI, our mission is simple. We help employers find and connect with the technology professionals who drive innovation across the U.S. economy. We do this through two brands, Clearance Jobs and Dice, both with strong positions in attractive markets. Our model is straightforward. More than 90% of our revenue comes from annual or multi-year subscriptions. Customers, who are employers or recruiters, use our platforms to search, engage, and recruit tech talent. Our exclusive focus on tech occupations, brand longevity, scale of our communities, data insights, and continued product innovation give us a durable competitive advantage. is the leading marketplace for professionals with active US security clearances, serving over 1,800 customers, including Lockheed, Booz Allen Hamilton, Leidos, Raytheon, and many others. With 1.9 million candidates on our platform, we have the largest number of profiles of US cleared professionals, giving CJ a significant competitive advantage as a platform for hiring cleared talent. Dice is essentially LinkedIn for tech hiring. Built over 35 years with 7.6 million profiles in our database, representing the vast majority of technology professionals in the US. While LinkedIn emphasizes a person's title, we focus on tech skills. Tech professionals on Dice actively update their profiles with new tech skills, making it the most relevant platform for recruiters who need to source tech talent. Both businesses generate strong recurring revenue and robust EBITDA margins, particularly at clearance jobs, where margins run above 40%. Investors often mistake us for a staffing and recruiting firm, but we are an essential software tool used by employers and recruiters to find top tech talent for their open positions. Over 6,000 employers and staffing companies subscribe to our two SaaS platforms. Despite a mixed macro backdrop and recent headlines, tech hiring has stabilized this year, although remaining under historical levels. While we don't have updated BLS tech job posting figures due to the government shutdown, we know from our alternative source, Lightcast, that new tech job postings were roughly the same as second quarter. DICE is an essential platform for staffing firms. And according to the staffing industry analysts Pulse reports, the median tech staffing firm in their membership is now growing revenue in low single digits compared to 2024. The most notable trend driving current and future tech worker demand is AI. At the beginning of 2024, approximately 10% of job postings on Dice required at least one AI skill. As of last month, that number has risen above 50%. As companies expand their use of AI, the need for skilled technologists that implement these projects will only increase. Platforms like Clearance Jobs and Dice, with their combined databases of over 9 million tech professionals, are an essential tool for employers seeking to find, attract, and hire the tech talent they need to fill these projects. I would like to provide an overview of our brand performance this quarter and outline the steps we've taken to improve our position moving forward. Clearance Jobs continues to generate strong margins and retain its leadership position despite a bookings decline of 0.8 million or 7% due to the government hiring freeze and eventual shutdown. But the long-term outlook is very favorable. The proposed 1.1 trillion US defense budget for fiscal year 2026 marks the largest single year increase in peacetime history, representing a 13% increase over the previous year's budget. Historically, the defense budget has grown roughly in line with GDP growth rates of around 3%, so this is a significant year-over-year increase. NATO countries are boosting defence spending with a target of 5% of their GDPs, which would represent a spending increase of more than $500 billion, with US contractors likely to secure a significant portion of this incremental spend. Traditionally, over 60% of EU defence procurement spending goes to US military contractors. These dynamics are promising for clearance jobs. With over 10,000 employers of cleared tech professionals and more than 100 government agencies also in need of cleared tech professionals, CJ has a significant growth opportunity as government contractors look to staff new projects. On the product side, we've integrated Agile ATS with our clearance jobs offering and are beta testing our premium candidate subscription ahead of its general release in Q1 of 2026. our first candidate monetization opportunity. As we announced last quarter, Agile ATS is the only applicant tracking system in the market designed specifically for the cleared recruiting environment. It's the only ATS on the market developed from the ground up to meet the unique regulatory and compliance requirements of government contractors. With Agile ATS now integrated with clearance jobs, we have begun offering a bundled solution to customers who want a seamless, end-to-end, cleared hiring workflow. Based on our analysis, we believe approximately half of our CJ customers today meet the target profile for this solution. With a historical average contract value of around $7,000 annually, we see strong incremental recurring revenue potential for Agile ATS, both from our existing CJ customer base and from new customers in the broader GovTech market. Additionally, we are excited about the opportunity for CJ to create a new recurring revenue stream from our new premium candidate subscription. We will be looking to roll out a similar offering on Dice in the future. With our Dice brand, in the third quarter, we continue to face macro headwinds from tariffs, budget uncertainty, and higher interest rates. As a result, the number of new tech job postings remain around 70% of normal, resulting in Dice bookings being down 17% year over year. Having said that, as I mentioned earlier, we are seeing significant interest in AI-related job postings, which we believe will drive future tech hiring demand. During the quarter, we made meaningful progress with our Dice platform from a product perspective. More than half of our 4,200 customers, primarily smaller accounts, have now migrated to the new platform, with all customers expected to be migrated by the end of Q1 2026. This new platform allows existing customers to add new products to their existing subscription online. It also allows new customers to sign up for a subscription with a swipe of a credit card. The price point is $650 a month for the lowest tier subscription package, which is easier for smaller customers to manage than an annual upfront charge. This move to a more self-service model allowed us to reduce DICE operating expenses significantly moving forward. Looking ahead, even though the past few years have been difficult, we have successfully laid the foundation for future growth. DICE is increasingly becoming the go-to destination for AI talent, and Clear's Jobs operates in a specialized high barrier market at the intersection of defense, security, and technology, with significant upside from defense budget growth and NATO spending. Our subscription model and margin structure give us resilience. We continue to believe the market doesn't fully reflect the value of each distinct brand today, which is why our board authorized a new $5 million buyback program starting this month. Over time, as we execute, modernize our platforms, and grow our customer base, we see a clear path to meaningful, continued shareholder value creation. And as always, we remain committed to delivering solid profits and robust free cash flow for our shareholders. With that, I'll turn the call over to Greg to walk you through the financial results and our guidance in more detail. Greg?