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What changed in ASGN Inc's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of ASGN Inc's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+191 added−179 removedSource: 10-K (2025-02-24) vs 10-K (2024-02-23)

Top changes in ASGN Inc's 2024 10-K

191 paragraphs added · 179 removed · 144 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe will invest in our organic growth while simultaneously looking to execute acquisitions in the commercial and federal government end markets focusing on IT consulting companies that provide us with new solution capabilities, industry expertise, or government contract awards. Candidates We recruit candidates with backgrounds in IT and creative digital marketing who seek contract or permanent work opportunities.
Biggest changeWe intend to continue to grow our diverse client base by focusing on large, stable enterprises that are quick adopters of new technologies. We will invest in our organic growth while simultaneously look to execute acquisitions of IT consulting companies that provide us with new solution capabilities, industry expertise, or government contract awards.
Our subject matter experts deliver solutions that are customer focused and value driven across a continuum of cloud, data and analytics, cyber/information security, artificial intelligence/machine learning ("AI/ML"), including generative AI (“GenAI”), and digital transformation solutions to support our clients’ modern enterprise and digital needs.
Our subject matter experts deliver solutions that are customer focused and value driven across a continuum of cloud, data and analytics, cyber/information security, artificial intelligence/machine learning ("AI/ML"), including generative AI (“GenAI”), and digital transformation to support our clients’ modern enterprise and digital needs.
To achieve this goal, our acquisition strategy specifically focuses on IT consulting companies that add new services, technical capabilities, and contracts that support our commercial and federal government customer needs and that are in high demand by our customer base.
To achieve this goal, our acquisition strategy specifically focuses on IT consulting companies that add new services, contracts, and technical capabilities that support our commercial and federal government customer needs and are in high demand by our customer base.
This sophisticated project delivery model offers us a cost advantage over the competition that has enabled us to grow above industry averages. Human Capital Our workforce is and will always be the core of our business.
This sophisticated project delivery model offers us a cost advantage over the competition that has previously enabled us to grow above industry averages. Human Capital Our workforce is and will always be the core of our business.
We intend to disclose any amendment to, or waiver from, a provision of our Code of Ethics for our Principal Executive Officer and Senior Financial Officers on our website promptly after the amendment or waiver has been granted. 5
We intend to disclose any amendment to, or waiver from, a provision of our Code of Ethics for our Principal Executive Officer and Senior Financial Officers on our website promptly after the amendment or waiver has been granted.
Our clients are looking to meet their business challenges at greater speed and with more accuracy and precision. We are therefore harnessing developing technologies, such as Microsoft’s Copilot and Azure OpenAI, to increase the efficiency of our own teams, while at the same time developing AI roadmaps for our clients that leverage new generative technologies.
Our clients are looking to meet their business challenges at greater speed and with more accuracy and precision. We are therefore harnessing technologies, such as Microsoft’s Copilot, Azure OpenAI, ServiceNow and Salesforce to increase the efficiency of our own teams, while at the same time developing AI roadmaps for our clients that leverage new generative technologies.
Corporate support activities for this segment are primarily based in Richmond, Virginia. We also have a network of 90 branch offices across the United States, and four branch offices across Canada and Europe. In addition, we have two near-shore delivery centers in Mexico, and we maintain a small delivery center in India.
Corporate support activities for this segment are primarily based in Richmond, Virginia. We also have a network of 81 branch offices across the United States, and four branch offices across Canada and Europe. In addition, we have two near-shore delivery centers in Mexico, and we maintain a small delivery center in India.
Corporate support activities for this segment are based in Fairfax, Virginia, and there are 19 branch offices located across the United States. Industry and Market Dynamics ASGN is a leading provider of IT services and solutions to the commercial and government sectors.
Corporate support activities for this segment are based in Fairfax, Virginia, and there are 16 branch offices located across the United States. Industry and Market Dynamics ASGN is a leading provider of IT services and solutions to the commercial and government sectors.
Strategy ASGN's strategy is to be a leading provider of IT services and professional solutions to the commercial and federal government sectors. We are focused on high-margin, scalable IT work for large commercial enterprise accounts and federal government customers.
Strategy ASGN's strategy is to be a leading provider of IT services and professional solutions to the commercial and federal government sectors. We are focused on high-value, scalable IT work for large commercial enterprise accounts and federal government customers.
From a client perspective, the principal competitive factors in obtaining and retaining clients are properly assessing the clients’ specific job and project requirements, the appropriateness of the professional assigned to the client, the price of services, and monitoring our clients’ satisfaction.
From a client perspective, the principal competitive factors in obtaining and retaining clients are properly assessing the clients’ specific job and project requirements, the appropriateness of the professionals assigned to the client, the price of services, and monitoring our clients’ satisfaction.
From a revenue and margin perspective, ASGN has grown through a combination of organic growth and strategic acquisitions. Over the last five years, we completed 11 "tuck-in" acquisitions.
From a revenue and margin perspective, ASGN has grown through a combination of organic growth and strategic acquisitions. Over the last five years, we completed nine "tuck-in" acquisitions.
Many people seeking 3 contract employment through us may also be pursuing employment through other means. Therefore, the speed at which we assign prospective professionals, and the availability of attractive and appropriate assignments, are important factors in our ability to fill open positions.
Many people seeking contract employment through us may also be pursuing employment through other means. Therefore, the speed at which we assign prospective professionals, and the availability of attractive and appropriate projects, are important factors in our ability to fill open positions.
For more information about our workforce programs and initiatives, please visit the Sustainability section of our website: ASGN.com/Sustainability. Nothing on our website shall be deemed incorporated by reference into this 2023 10-K. Government Regulation We take reasonable steps to ensure that our billable professionals possess all current licenses and certifications required for each placement.
For more detailed information on our workforce programs and initiatives, please visit the Sustainability section of our website: ASGN.com/Sustainability. Nothing on our website shall be deemed incorporated by reference into this 2024 10-K. Government Regulation We take reasonable steps to ensure that our billable professionals possess all current licenses and certifications required for each placement.
Contracts range from approximately three to five years in length, providing longer-term revenue visibility and countercyclical support throughout market cycles. We have contract backlog of $3.0 billion as of December 31, 2023, which represents the estimated amount of future revenues to be recognized under awarded contracts including task orders and options.
Contracts range from approximately three to five years in length, providing longer-term revenue visibility and countercyclical support throughout market cycles. We have contract backlog of $3.1 billion as of December 31, 2024, which represents the estimated amount of future revenues to be recognized under awarded contracts including task orders and options.
ASGN helps leading corporate enterprises and government organizations develop, implement, and operate critical IT and business solutions through its integrated offering of IT consulting and professional staffing. Our total addressable market is approximately $580 billion, which includes $400 billion in commercial IT consulting, $121 billion in government IT consulting, and $59 billion in professional staffing.
ASGN helps leading corporate enterprises and government organizations develop, implement, and operate critical IT and business solutions through its integrated offering of IT consulting and professional staffing. Our total addressable market is approximately $580 billion, which includes $410 billion in commercial IT consulting, $121 billion in government IT consulting, and $49 billion in professional staffing.
After achieving minimum service periods and/or hours worked, our professionals are offered access to medical and other voluntary benefit programs (e.g., dental, vision, disability) and the right to participate in our 401(k) retirement savings plan. Each professional’s employment relationship with us is terminable at will. In 2023, we employed approximately 23,500 billable professionals on a full-time-equivalent basis.
After achieving minimum service periods and/or hours worked, our professionals are offered access to medical and other voluntary benefit programs (e.g., dental, vision, disability) and the right to participate in our 401(k) retirement savings plan. Each professional’s employment relationship with us is terminable at will. In 2024, we employed approximately 21,300 billable professionals on a full-time-equivalent basis.
From a talent perspective, we offer more opportunities for the billable professional and are viewed as a better partner for their career objectives. In addition, competitive factors that attract qualified candidates are salaries and benefits; availability and variety of opportunities; quality, duration and location of assignments (if not remote/hybrid); and responsiveness to requests for placement.
From a talent perspective, we offer more opportunities for the billable professional and are viewed as a better partner for their career objectives. In addition, competitive factors that attract qualified candidates include salaries and benefits; availability and variety of opportunities; quality, duration and location of assignments; and responsiveness to requests for placement.
In addition, unlike our competitors in the traditional consulting space, for the majority of our IT consulting business we do not rely upon a bench to support us; rather, we use our database and a deep labor pool of highly-skilled technical talent developed over decades to provide and build teams that offer our clients a full suite of services tailored to their individual needs.
In addition, unlike our competitors in the traditional consulting space, for the majority of our IT consulting business we do not rely upon a bench to support us; rather, we use our extensive databases containing our deep labor pool of highly-skilled technical talent to provide and build teams that offer our clients a full suite of services tailored to their individual needs.
Our diverse talent pool strengthens our position as a leading global IT professional services firm, and we aim to recruit diverse leaders in their respective areas of expertise that support ASGN’s high-performance, innovative, and collaborative culture. In 2023, we employed approximately 3,700 internal employees, including sales directors, account managers, recruiters, and corporate office employees.
Our diverse talent pool strengthens our position as a leading IT consulting and professional services firm, and we aim to recruit exceptional leaders in their respective areas of expertise that support ASGN’s high-performance, innovative, and collaborative culture. In 2024, we employed approximately 3,200 internal employees, including sales directors, account managers, recruiters, and corporate office employees.
Nevertheless, our now larger total addressable market in IT consulting offers us a greater revenue opportunity.
Nevertheless, our larger total addressable market in IT consulting offers us a greater revenue and margin opportunity.
Health, Safety, and Well-being — Our employees enjoy competitive compensation and benefits packages, which include medical, dental, and vision plans; flexible spending accounts; and savings plans. We further support our employees' emotional well-being and physical health with wellness programming and personal growth workshops .
Our employees enjoy competitive compensation and benefits packages, which include medical, dental, and vision plans; flexible spending accounts; and savings plans. Guided by our Company-wide Employee Wellness and Workplace Health and Safety policies, we support our employees' emotional well-being and physical health with wellness programming and personal growth workshops.
When we place these candidates on projects with clients, they become our employees. Many of these professionals, and those we place via subcontractors, are paid hourly wage or contract rates based on their specific skills.
Candidates We recruit candidates with backgrounds in IT and creative digital marketing who seek contract or permanent work opportunities. When we place these candidates on projects with clients, they become our employees. Many of these professionals, and those we place via subcontractors, are paid hourly wage or contract rates based on their specific skills.
From a client perspective, ASGN has grown by effectively understanding our clients’ IT needs and providing them with qualified professionals who maintain a unique combination of skills, experience, and expertise to meet those needs. Our clients set rigorous requirements for talent, which have only increased as we’ve evolved our business to offer higher-end, higher-value IT consulting solutions.
We do so by providing our clients with qualified IT and creative marketing professionals who maintain a unique combination of skills, experience, and expertise to meet those needs. Our clients set rigorous requirements for talent, technological proficiency, and solutions capabilities, which have only increased as we’ve evolved our business to offer higher-end, higher-value IT consulting solutions.
Our billable professionals have knowledge and experience in specialized technical and creative digital marketing services that make them qualified to fill a given assignment or project. Assignment contracts may vary in length but typically range between three and six months in duration.
Our billable professionals have knowledge and experience in specialized technical and creative digital marketing services that make them qualified to fill a given assignment or project.
We have built a sizable consulting platform, with over 55 percent of our revenues in a combination of commercial and federal government IT consulting work in the fourth quarter of 2023. We have grown our IT consulting revenues both organically and through acquisitions, and our goal is to continue this growth.
We have built a sizable consulting platform, with 58 percent of our 2024 consolidated revenues in a combination of commercial and federal government IT consulting work. We have grown our IT consulting revenues both organically and through acquisitions, and our goal is to continue this top line growth while also enhancing our margins.
Federal Government Segment Our Federal Government Segment (28.7 percent of 2023 consolidated revenues), our sixth industry vertical, delivers advanced solutions in cloud and enterprise IT, cybersecurity, AI/ML, application, and digital transformation to some of the world's leading agencies in both the public and private sectors.
Assignment contracts may vary in length but typically range between three and six months in duration. 2 Federal Government Segment Our Federal Government Segment (30 percent of 2024 consolidated revenues), our sixth industry vertical, delivers advanced solutions in cloud and enterprise IT, cybersecurity, AI/ML, application, and digital transformation to some of the world's leading agencies in both the public and private sectors.
Each of these acquisitions align with our strategy to expand our IT consulting services and solutions capabilities, offer higher-value technical solutions, and become a leading provider of these high-end services to the commercial and federal government markets.
Each of these acquisitions align with our strategy to expand our IT consulting services and solutions capabilities, offer higher-value technical solutions, and become a leading provider of these high-end services to the commercial and federal government markets. From a client perspective, ASGN has grown by effectively understanding our clients’ IT needs and supporting their long-term, strategic IT roadmaps.
Our business model continues to evolve in line with client needs and expectations to focus on higher-end, higher-margin IT consulting services and solutions capabilities, particularly those related to digital transformation and other areas of technology change and specialization including data analytics, AI/ML, including both traditional and GenAI, big data, process automation, and information security.
Our business model continues to evolve in line with client needs and expectations to focus on higher-end, high value IT consulting services and solutions capabilities that provide enhanced margin opportunities in key areas of technological advancement such as digital transformation, data analytics, AI/ML, process automation, and information security.
From a business advancement perspective, ASGN invests in six core areas, including leadership, recruitment of in-demand skillsets, training and skill development, partnerships, internal artificial intelligence ("AI") tools, and client AI roadmaps. ASGN was incorporated in 1992. Our principal office is located at 4400 Cox Road, Suite 110, Glen Allen, Virginia 23060, and our telephone number is (888) 482-8068.
From a business advancement perspective, ASGN invests in six core areas, including leadership, recruitment of in-demand skillsets, training and skill development, technology partnerships, internal efficiency, and data management capabilities including artificial intelligence ("AI") and cybersecurity tools, and client AI roadmaps. ASGN was incorporated in 1992.
Our robust commercial talent pool, which includes onshore, nearshore, and offshore professionals, can be deployed in short duration, solution-specific engagements, or on long-term consultative roles.
Our robust commercial talent pool, which includes onshore, nearshore, and offshore professionals, can be deployed in short duration, solution-specific engagements, or on long-term consultative roles. Our roots in IT staffing offer a strong account base and foothold in our clients’ businesses, while our consulting offerings enable us to offer higher-end, high value solutions.
We position our teams to stay at the forefront of emerging trends in digitization and candidate sourcing, including GenAI technologies that assist teams in creating robust models around candidate search and match to best position our businesses and continuously improve how we serve clients and consultants.
We position our teams to stay at the forefront of emerging trends in digitization and candidate sourcing, including GenAI technologies that assist teams in creating robust models around candidate search and match, to best position our businesses and continuously improve how we serve clients and candidates. 3 Competition We compete with other large publicly-held and privately-owned providers of human capital in the IT consulting and professional services segments on a local, regional, national, and international basis across the commercial and government end markets.
As we support clients across a diverse set of industry verticals, no client, other than the U.S. federal government, represented more than 10 percent of revenues in 2023. Revenues from contracts directly with several U.S. federal government agencies combined were approximately 24.3 percent of 2023 consolidated revenues.
We are responsible for recruiting, verifying credentials upon request, hiring, administering pay and benefits, compliance, and training, as applicable. As we support clients across a diverse set of industry verticals, no client, other than the U.S. federal government, represented more than 10 percent of consolidated revenues in 2024.
Our performance management process focuses on developing clear goals at the start of each calendar year (or at the beginning of one’s term of employment) and providing constructive feedback and support throughout the year to best develop our employees’ careers and position them for success.
This is a collaborative process that focuses on developing clear goals at the start of each calendar or employment year and providing constructive feedback and support throughout the year to position our employees for success. Furthermore, to guide our efforts on a go-forward basis and drive long-term employee retention, we conduct annual employee engagement surveys.
Our team of skilled experts tackle critical and highly-complex challenges for customers in the U.S. defense, 2 intelligence, and federal civilian agencies. We maintain relationships with leading cloud, cybersecurity, and AI/ML providers and hold specialized certifications in these technologies.
We maintain relationships with leading cloud, cybersecurity, and AI/ML providers and hold specialized certifications in these technologies.
Commercial Segment Our Commercial Segment (71.3 percent of 2023 consolidated revenues) provides a broad spectrum of IT services and solutions to Fortune 1000 and large enterprise clients.
Our principal office is located at 4400 Cox Road, Suite 110, Glen Allen, Virginia 23060, and our telephone number is (888) 482-8068. Commercial Segment Our Commercial Segment (70 percent of 2024 consolidated revenues) provides a broad spectrum of IT services and solutions to Fortune 1000 and large mid-market clients.
By employing our professional staffing and consulting services, our clients benefit from cost structure advantages, flexibility to address fluctuating demand in business, and access to greater expertise. We intend to continue to grow our diverse client base by focusing on large, stable accounts that are quick adopters of new technologies.
By employing a unique go-to-market strategy that leverages a single talent pool for both shorter-term assignments and long-term consulting contracts, our clients benefit from cost structure advantages, flexibility to address fluctuating demand in business, and access to greater expertise.
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To meet these talent requirements, we use our extensive databases and deep talent pool to quickly identify and pre-screen candidates. We are responsible for recruiting, verifying credentials upon request, hiring, administering pay and benefits, compliance and training, as applicable.
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To meet these talent requirements, we leverage our deep talent pool that is carefully maintained in our extensive databases that have been expertly built over decades to quickly identify and pre-screen candidates, whether for a shorter-term assignment or longer-term consulting contract. This enables ASGN to differentiate itself in the marketplace by building tailored, just-in-time teams for our clients.
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Our roots in IT staffing offer a strong account base and foothold in our clients’ businesses, while our consulting offerings enable us to offer more value to our accounts via higher-end, higher margin work including workforce mobilization, modern enterprise, and digital innovation IT consulting services.
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Revenues from contracts directly with several U.S. federal government agencies in which our Federal Government Segment is a prime contractor combined were 24 percent of consolidated revenues in 2024.
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Competition We compete with other large publicly-held and privately-owned providers of human capital in the IT consulting and professional services segments on a local, regional, national, and international basis across the commercial and government end markets.
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These solutions capabilities are geared towards IT modernization of the federal government as well as promote efficiency for our federal customer base. Our team of skilled experts tackles highly complex challenges for customers in the U.S. defense and intelligence agencies along with key federal civilian agencies, namely the Department of Homeland Security.
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We support our employees and billable professionals through the following initiatives: Culture and Belonging — At ASGN, we strive for equity across all levels of employment. Our efforts include training, recruitment, retention, and advancement programs. These programs aim to remove bias in hiring and promotions.
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We support our internal employees in a number of ways including, but not limited to, the following initiatives: Engagement and Professional Development – Our team is the driving force behind our success, and continuing to support career development and advancement across our Company remains one of ASGN’s top organizational priorities.
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Our Diversity, Equity, and Inclusion (“DEI”) Director leads programs aimed at promoting personal and professional growth for employees from diverse backgrounds, providing our employees with increased opportunities to feel motivated, valued, and fulfilled as they achieve personal and professional successes at ASGN.
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We prioritize career growth through ongoing education, professional development, and comprehensive training. To supplement in-person and virtual training, ASGN maintains a mentorship program where mentors are provided opportunities to enhance their management and communication skills, while mentees are given the ability to foster relationships with experienced professionals who can support their career development.
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Over 40 percent of our senior level management positions are diverse by racial and ethnic diversity, sexual orientation, gender, disability, or veteran status. While we believe we have assembled a diverse workforce and leadership team, we are committed to continuous improvement to foster an increased sense of belonging.
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Performance Management & Retention – With regards to career development, we encourage our employees to seek opportunities that align with their long-term career goals. Communicating career interests and employee development is therefore at the heart of our performance management process.
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In 2023, we launched a Company-wide inclusion council to collaborate, strategize, and implement initiatives that enrich our workplaces, nurture inclusivity, and drive sustainable growth. Women comprise 27 percent of ASGN’s Board of Directors ("Board") and 18 percent of its members identify as being from an underrepresented group.
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In 2024, we achieved an 85 percent overall participation rate in our employee engagement survey. Health, Safety, and Well-bein g – Core to employee retention, we also remain focused on the health and well-being of each of our employees and consultants.
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Guided by our Company-wide Employee Wellness and Workplace Health and Safety policies, we continue to seek opportunities to expand our offerings where feasible. Further, ASGN offers flexible and hybrid work schedules to support work-life balance and contribute to the well-being of our employees at work and at home.
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Our goal is to create and maintain a safe, healthy, and happy workplace that motivates and leads to retention across the Company. Employee Engagement, Retention and Development — We prioritize career growth through ongoing education and professional development.
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Employees are provided with comprehensive training, including programming on ethics and integrity, workplace inclusion and belonging, discrimination and harassment, cybersecurity, workplace safety, and career-specific modules. We achieved a 72 percent overall participation rate in our 2023 employee engagement survey.
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We continue to support ASGN’s Employee Resource Groups (“ERGs”) and Employee Community Groups (“ECGs”) across our brands to foster a diverse and inclusive environment.
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ERGs are voluntary, employee-led groups whose aim is to create a safe space, foster an inclusive workplace, and provide support, while ECGs are voluntary social circles of employees who join based on shared values, interests, and goals.
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We have initiated a mentorship program (“ASGN Engage & Empower”) which is a cornerstone of our commitment to foster an environment where every employee has the opportunity to grow, learn, and contribute to their fullest potential. Mentors value the fresh perspectives of the mentees, while mentees feel supported and gain insights into different business areas.
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Collaborative Performance Management — We believe in empowering our employees to drive their career growth. This includes seeking varied job roles, cross-functional training, and participating in special projects.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAlthough we devote significant resources to maintain and regularly upgrade our information security technologies, and we have implemented security controls to help protect the security and privacy of our business information, our information technology systems are subject to potential security breaches through third-party service providers, employee negligence, fraud or misappropriation, business email compromise and cybersecurity threats, including denial of service attacks, viruses, ransomware, or other malicious software programs, and third parties gaining unauthorized access to our information technology systems for purposes of misappropriating assets or confidential information, corrupting data, or causing operational disruption.
Biggest changeAlthough we devote significant resources to maintain and regularly upgrade our information security technologies, and we have implemented security controls to help protect the security and privacy of our business information on-premise and in the cloud, our and third-party information technology systems’ confidentiality, integrity, and availability are subject to cybersecurity risks from diverse threat actors, such as state-sponsored organizations, opportunistic hackers and hacktivists, as well as through diverse attack vectors, such as potential security breaches through third-party service providers, employee negligence, fraud or misappropriation, business email compromise and cybersecurity threats, including denial of service attacks, viruses, ransomware, social engineering/phishing, other malicious software programs, and as a result of malicious code embedded in open-source software, or misconfigurations, bugs or other vulnerabilities in commercial software that is integrated into our or our service providers’ IT systems, products or services.
These provisions include the following: • Our Board has the right to elect directors to fill a vacancy in the Board upon the resignation, death, or removal of a director, which prevents stockholders from being able to fill vacancies on our Board until the next applicable annual meeting of stockholders. • Stockholders must provide advance notice to nominate individuals for election to the Board or to propose matters that can be acted upon at a stockholders’ meeting.
These provisions include the following: • Our Board has the right to elect directors to fill a vacancy in the Board upon the resignation, death, or removal of a director, which prevents stockholders from being able to fill vacancies on our Board until the next applicable annual meeting of stockholders. 12 • Stockholders must provide advance notice to nominate individuals for election to the Board or to propose matters that can be acted upon at a stockholders’ meeting.
If we are unable to win particular contracts, we may be prevented from providing services to customers that are purchased under those contracts for a number of years. In addition, upon the expiration of a contract, if the customer requires further services of the type provided by the contract, 9 there is frequently a competitive rebidding process.
If we are unable to win particular contracts, we may be prevented from providing services to customers that are purchased under those contracts for a number of years. In addition, upon the expiration of a contract, if the customer requires further services of the type provided by the contract, there is frequently a competitive rebidding process.
In addition, our quarterly and annual revenue growth rates and expenses as a percentage of our revenues may differ significantly from our historical rates, and our future operating results may fall below expectations. 8 Our environmental, social and governance (ESG) commitments and disclosures may expose us to reputational risks and legal liability.
In addition, our quarterly and annual revenue growth rates and expenses as a percentage of our revenues may differ significantly from our historical rates, and our future operating results may fall below expectations. Our environmental, social and governance (ESG) commitments and disclosures may expose us to reputational risks and legal liability.
Any of these factors may have a material adverse effect on our results of operations and financial condition. An impairment in the carrying amount of goodwill and other intangible assets could require a write-down that materially and adversely affects our results of operations and net worth.
Any of these factors may have a material adverse effect on our results of operations and financial condition. 7 An impairment in the carrying amount of goodwill and other intangible assets could require a write-down that materially and adversely affects our results of operations and net worth.
We believe that the successful execution of our business strategy and our ability to build upon our business and acquisitions of new businesses depends on the continued employment of key members of our senior management team and good succession plans for their retirement or other departure.
We believe that the successful execution of our business strategy and our ability to build upon our business and acquisitions of new businesses depends on the continued employment of key members of our senior management team and maintaining good succession plans for their retirement or other departure.
There also can be no assurance that we will realize the benefits expected from any transaction or receive a favorable return on investment from our acquisitions. 7 The integration of an acquisition involves a number of factors that may affect our operations.
There also can be no assurance that we will realize the benefits expected from any transaction or receive a favorable return on investment from our acquisitions. The integration of an acquisition involves a number of factors that may affect our operations.
In periods of high unemployment, due to a large pool of available candidates, clients are able to directly hire and recruit qualified candidates without the involvement of our services. Sometimes we utilize subcontractors to provide us with qualified professionals.
In periods of high unemployment, due to a large pool of available candidates, clients are able to directly hire and recruit qualified candidates without the involvement of our services. 5 Sometimes we utilize subcontractors to provide us with qualified professionals.
Our ability to control or influence the workplace environment of our clients is limited. Further, many of the individuals that we place with our clients have access to client information systems and confidential information.
Our ability to control or influence the workplace environment of our clients is limited. Further, many of the individuals that we place with our clients have access to client information systems and confidential 10 information.
Failure to complete a budget for fiscal year 2024 or to provide for another continuing resolution by applicable deadlines may result in a federal government shutdown, which could cause us to incur labor or other costs without reimbursement under customer contracts or the delay or cancellation of key programs, and could adversely impact our operations, cash flows, and financial results.
Failure to complete a budget for fiscal year 2025 or to provide for another continuing resolution by applicable deadlines may result in a federal government shutdown, which could cause us to incur labor or other costs without reimbursement under customer contracts or the delay or cancellation of key programs, and could adversely impact our operations, cash flows, and financial results.
The market price of our stock has fluctuated substantially in the past and could fluctuate substantially in the future, based on a variety of factors, including our operating results; changes in general conditions in the economy and/or the staffing and consulting industries; announcements by our competitors; involvement in a significant litigation matter; a major change in our management; and short sales, hedging, and other derivative transactions in shares of our common stock.
The market price of our stock has fluctuated substantially in the past and could fluctuate substantially in the future, based on a variety of factors, including our operating results; announcements of changes in government priorities; changes in general conditions in the economy and/or the staffing and consulting industries; announcements by our competitors; involvement in a significant litigation matter; a major change in our management; and short sales, hedging, and other derivative transactions in shares of our common stock.
These provisions of Delaware law may have the impact of delaying, deferring, or preventing a change of control and may discourage bids for our common stock at a premium over its market price. In addition, our Board could rely on these provisions of Delaware law to discourage, prevent, or delay an acquisition of us.
These provisions of Delaware law may have the impact of delaying, deferring, or preventing a change of control and may discourage bids for our common stock at a premium over its market price. In addition, our Board could rely on these provisions of Delaware law to discourage, prevent, or delay an acquisition of us. Item 1B.
We may not be successful in our continuing integration and optimization efforts, which may cause us to fail to achieve the cost savings we anticipate or limit our ability to scale growth. Further, we may fail to prevent the return of costs eliminated in 6 these efforts.
We may not be successful in our integration and optimization efforts, which may cause us to fail to achieve the cost savings we anticipate or limit our ability to scale growth. Further, we may fail to prevent the return of costs eliminated in these efforts.
Our daily business operations depend on our information technology systems for a wide variety of functions, including, among other things, identifying consulting and staffing resources, matching personnel with client assignments, and managing our accounting and financial reporting functions.
Our daily business operations depend on our information technology systems and third-party systems for a wide variety of functions, including, among other things, identifying consulting and staffing resources, matching personnel with client assignments, and managing our accounting and financial reporting functions.
Our business is subject to government regulation, which in the future could restrict the types of employment services we are permitted to offer or result in additional or increased costs that reduce our revenues and earnings. The IT consulting and staffing services industry is regulated in the United States and other countries in which we operate.
Our business is subject to government regulation, which in the future could restrict the types of employment services we are permitted to offer or result in additional or increased costs that reduce our revenues and earnings. The IT services and solutions industry is regulated in the United States and other countries in which we operate.
Contract backlog consists of contracts for which funding has been formally awarded (funded backlog of $0.5 billion at December 31, 2023) and unfunded backlog, which represents the estimated future revenues to be earned from negotiated contract awards for which funding has not been awarded, and from unexercised contract options (unfunded backlog of $2.5 billion at December 31, 2023).
Contract backlog consists of contracts for which funding has been formally awarded (funded backlog of $0.5 billion at December 31, 2024) and unfunded backlog, which represents the estimated future revenues to be earned from negotiated contract awards for which funding has not been awarded, and from unexercised contract options (unfunded backlog of $2.6 billion at December 31, 2024).
If our growth rate continues to decline, or we fail to grow at the pace anticipated and we are unsuccessful in our growth initiatives and strategies, our financial results could be less than our expectations or those of investors or analysts.
If our growth rate continues to decline, or we fail to grow at the pace anticipated and we are unsuccessful in our growth initiatives and strategies, our financial results could be less than our expectations or those of investors or sell-side research analysts.
Our business depends upon continued U.S. government expenditures on cybersecurity, cloud and enterprise IT, AI/ML, digital transformation, and other programs that we support. During 2023, revenues from contracts directly with U.S. federal government agencies were approximately 24.3 percent of consolidated revenues.
Our business depends upon continued U.S. government expenditures on cybersecurity, cloud and enterprise IT, AI/ML, digital transformation, and other programs that we support. During 2024, revenues from contracts directly with U.S. federal government agencies were 24 percent of consolidated revenues.
The success of our business depends upon our ability to continually secure new consulting projects and assignment contracts from clients and to fill them with our billable professionals. Most of our agreements with clients do not provide for exclusive use of our services and many of our agreements may be terminated at will.
The success of our business depends upon our ability to continually secure new long-term consulting projects as well as shorter-term assignment contracts from clients and to fill them with our billable professionals. Most of our agreements with clients do not provide for exclusive use of our services and many of our agreements may be terminated at will.
Our outstanding debt at December 31, 2023 included a term loan of $498.8 million under our senior secured credit facility due 2030, and $550.0 million of 4.625 percent unsecured senior notes due 2028. We have a $500.0 million senior secured revolving credit facility due 2028, which is fully available as of December 31, 2023.
Our outstanding debt at December 31, 2024 included a term loan of $493.8 million under our senior secured credit facility due 2030, and $550.0 million of 4.625% unsecured senior notes due 2028. We have a $500.0 million senior secured revolving credit facility due 2028, which is fully available as of December 31, 2024.
These laws impact our U.S. operations as well as our European operations as they apply not only to third-party transactions, but also to transfers of information among the Company and its subsidiaries. Certain U.S. states have also enacted data privacy laws requiring security measures for personal information.
These laws impact our U.S. operations as well as our European operations as they apply not only to third-party transactions, but also to transfers of information among the Company and its subsidiaries. Certain U.S. states such as California have also enacted data privacy laws imposing requirements including security measures for personal information.
As of December 31, 2023, we had $1.9 billion of goodwill and $497.9 million of net acquired intangible assets. We review goodwill and indefinite-lived intangible assets (consisting entirely of trademarks) for impairment at least annually, and when events or changes in circumstances indicate that the carrying amount may not be recoverable.
As of December 31, 2024, we had $1.9 billion of goodwill and $439.8 million of net acquired intangible assets. We review goodwill and indefinite-lived trademarks for impairment at least annually, and when events or changes in circumstances indicate that the carrying amount may not be recoverable.
Failure of internal controls may leave us susceptible to errors and fraud. Management does not expect that our disclosure controls and internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable assurance that the objectives of the control system are met.
Management does not expect that our disclosure controls and internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable assurance that the objectives of the control system are met.
Contract backlog, which was $3.0 billion at December 31, 2023, is a useful measure of potential future revenues for our Federal Government Segment.
Contract backlog, which was $3.1 billion at December 31, 2024, is a useful measure of potential future revenues for our Federal Government Segment.
Considerable uncertainty exists regarding how future budget and program decisions will unfold, including the spending priorities of the U.S. government. Because the U.S. Congress did not complete a budget before the end of the 2023 fiscal year, government operations are currently being funded through short-term continuing resolutions.
Considerable uncertainty exists regarding how future budget and program decisions will unfold, including the spending priorities of the U.S. government and the uncertainty related to the administration's efforts to improve efficiency. Because the U.S. Congress did not complete a budget before the end of the 2024 fiscal year, government operations are currently being funded through short-term continuing resolutions.
Failure to accurately estimate costs, resources, and technology needed to perform our contracts or to effectively manage and control our costs during the performance of work could result in reduced profits or in losses. Under cost reimbursable contracts, we are reimbursed for allowable costs plus a profit margin or fee. These contracts generally have lower profitability and less financial risk.
Failure to accurately estimate costs, resources, and technology needed to perform our contracts or to effectively manage and control our costs during the performance of work could result in reduced profits or in losses. Under cost reimbursable contracts, we are reimbursed for allowable costs plus a profit margin or fee.
Furthermore, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, would be detected, particularly in our newly acquired companies and international operations.
Furthermore, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, would be detected, particularly in our newly acquired companies and international operations. If our internal controls are unsuccessful, our business and results of operations could be adversely affected.
Under time and materials contracts, we are reimbursed for labor at negotiated hourly billing rates and for certain expenses. We assume financial risk on time and materials contracts because we assume the risk of performing those contracts at negotiated hourly rates.
These contracts generally have lower profitability and less financial risk. 9 Under time and materials contracts, we are reimbursed for labor at negotiated hourly billing rates and for certain expenses. We assume financial risk on time and materials contracts because we assume the risk of performing those contracts at negotiated hourly rates.
Any security incident that results in the compromise of personal information we collect and retain, or that otherwise disrupts or negatively impacts our operations, could harm our reputation, lead to customer or employee attrition, and expose us to regulatory enforcement action or litigation.
Any security incident that results in the compromise of the confidentiality, integrity, and availability of our IT systems and Confidential Information we collect and retain, or that otherwise disrupts or negatively impacts our operations, could harm our reputation, lead to customer or employee attrition, and expose us to regulatory enforcement action or litigation (including class actions).
In addition, we are subject to data privacy, protection, and security laws and regulations, the most significant of which are the European General Data Protection Act ("GDPR") and the U.K.’s Data Protection Act 2018 (which implements the GDPR into U.K. law). These laws impose stringent data protection requirements on personal information and provide for significant penalties for noncompliance.
We and our vendors are subject to data privacy, protection, and security laws, rules, regulations, industry standards and other requirements, including the European General Data Protection Act ("GDPR") and the U.K.’s Data Protection Act 2018 (which implements the GDPR into U.K. law). These laws impose stringent data protection requirements on personal information and provide for significant penalties for noncompliance.
In prior years, we have experienced revenue and earnings growth both organically and through acquisitions. There is no assurance that we will be able to continue this pace of growth in the future or meet our strategic objectives for growth, and in fact our growth declined this past year due to macroeconomic conditions.
In prior years, we have experienced revenue and earnings growth both organically and through acquisitions. There is no assurance that we will resume this pace of growth in the future or meet our strategic objectives for growth. Our revenues declined this past year due to adverse macroeconomic conditions, including an IT industry recession.
In addition, although we may elect to bill some or all of any additional costs to our customers, there can be no assurances that we will be able to increase the fees charged to our customers in a timely manner and in a sufficient amount to fully cover any increased costs as a result of future changes in laws or government regulations.
In addition, although we may elect to bill some or all of any additional costs to our customers, there can be no assurances that we will be able to increase the fees charged to our customers in a timely manner and in a sufficient amount to fully cover any increased costs as a result of future changes in laws or government regulations. 11 Our business may be materially affected by changes to fiscal and tax policies that could adversely affect our results of operations and cash flows.
We are continuously exposed to unauthorized attempts to compromise such sensitive information through cyber attacks, insider threats and other information security threats, including physical break-ins and malicious insiders, and we have, from time to time, experienced security incidents.
We are continuously exposed to unauthorized attempts to compromise the confidentiality, integrity, and availability of our IT systems and Confidential Information through cyber attacks, insider threats and other information security threats, including physical break-ins and malicious insiders, and we have, from time to time, experienced security incidents.
The professional staffing and consulting services industry is highly competitive and fragmented with limited barriers to entry. We compete in national, regional, and local markets with full-service agencies and in regional and local markets with specialized contract staffing agencies and consulting businesses.
The IT services industry is highly competitive and fragmented with limited barriers to entry. We compete in national, regional, and local markets with professional services firms, traditional consulting agencies, and specialized boutique industry or solutions-focused businesses.
Our business strategy also includes continuing efforts to integrate and optimize our organization, programs, technology, and delivery of services to make us a more agile and effective competitor, to reduce the cost of operating our business, and to increase our operating profit and operating profit margin.
Our business strategy is focused on integrating and optimizing our organization, programs, technology, and delivery of services to make us a more agile and effective competitor, to reduce the cost of operating our business, and to increase our operating profit and operating profit margin.
For example, we recently announced a collaboration with Microsoft to invest in and pilot NextGen AI technologies, including Copilot for Microsoft 365 and Azure OpenAI Service.
We work both internally and with our enterprise customer base to develop strategic use cases for GenAI technologies. For example, we recently announced a collaboration with Microsoft to invest in and pilot NextGen AI technologies, including Copilot for Microsoft 365 and Azure OpenAI Service.
Any non-compliance with the data privacy laws applicable to our business could result in governmental enforcement actions, fines, and other penalties that could potentially have an adverse effect on our operations and reputation. 11 Future changes in the laws or governmental regulations affecting our business may result in the prohibition or restriction of certain types of employment services that we are permitted to offer, or the imposition of new or additional compliance requirements that could increase our costs and reduce our revenues and earnings.
Future changes in the laws or governmental regulations affecting our business may result in the prohibition or restriction of certain types of employment services that we are permitted to offer, or the imposition of new or additional compliance requirements that could increase our costs and reduce our revenues and earnings.
Our business may be materially affected by changes to fiscal and tax policies that could adversely affect our results of operations and cash flows. Our business is subject to taxation in the United States and the foreign jurisdictions where we operate. Due to economic and political conditions, tax rates in various jurisdictions may be subject to significant change.
Our business is subject to taxation in the United States and the foreign jurisdictions where we operate. Due to economic and political conditions, tax rates in various jurisdictions may be subject to significant change.
We, as with other companies, are facing increasing scrutiny related to our environmental, social and governance (“ESG”) practices and disclosures from certain investors, shareholder advocacy groups, customers, employees, federal, state, and local governments, and other stakeholders. With this increased focus, public reporting regarding ESG practices is becoming more broadly expected.
We, as with other companies, face scrutiny related to our environmental, social and governance (“ESG”) practices and disclosures required or made by certain customers, employees, investors, shareholder advocacy groups, federal, state, and local governments, and other stakeholders. With this increased focus, public reporting of ESG practices has become commonplace.
Our international operations, which represented approximately two percent of our consolidated revenues in 2023, expose us to, among other things, operational, regulatory, and political risks in the countries in which we operate. General Risks The loss of key members of our senior management team could adversely affect the execution of our business strategy and our financial results.
Our international operations, which represented approximately two percent of our consolidated revenues in 2024, expose us to, among other things, operational, regulatory, and political risks in the countries in which we operate.
For information on our cybersecurity risk management, strategy, and governance, see Item 1C. Cybersecurity. We may not successfully make or integrate acquisitions, which could harm our business and growth. As part of our growth strategy, we have made numerous acquisitions, and we intend to continue to pursue select acquisitions in the future.
We may not successfully make or integrate acquisitions, which could harm our business and growth. As part of our growth strategy, we have made numerous acquisitions, and we intend to continue to pursue select acquisitions in the future, including the acquisition of TopBloc, LLC, which we announced on February 4, 2025, subject to regulatory approval.
The failure to prevent a cybersecurity incident affecting our systems could result in the disruption of our services or the disclosure or misuse of sensitive information, which could harm our reputation, decrease demand for our services and products, expose us to liability, penalties, and remedial costs, or otherwise adversely affect our financial performance.
Furthermore, because AI technology itself is highly complex and rapidly developing, it is not possible to predict all of the legal, operational, or technological risks that may arise relating to the use of AI. 6 The failure to prevent a cybersecurity incident affecting our or third-party systems could result in the disruption of our services or the disclosure or misuse of sensitive information, which could harm our reputation, decrease demand for our services and products, expose us to liability, penalties, and remedial costs, or otherwise adversely affect our financial performance.
Moreover, our revenues and operating results could be adversely affected if any prime contractor chose to offer directly to the customer services of the type that we provide, or if they team with other companies to provide those services. 10 Audits by U.S. government agencies for contracts with federal government clients could result in unfavorable audit results that could subject us to a variety of penalties and sanctions and could harm our reputation and relationships with our customers and adversely impact results of operations.
Audits by U.S. government agencies for contracts with federal government clients could result in unfavorable audit results that could subject us to a variety of penalties and sanctions and could harm our reputation and relationships with our customers and adversely impact results of operations.
We have provided short-term and long-term incentive compensation to our key management in an effort to retain them, and have prepared succession plans at such time as their employment ends.
If we cannot attract and retain qualified personnel or effectively implement appropriate succession plans, it could have a material adverse impact to our business, financial condition, and/or results of operations. We have provided short-term and long-term incentive compensation to our key management in an effort to retain them, and have prepared succession plans at such time as their employment ends.
Our processes and controls for reporting ESG matters across our operations and supply chain are evolving along with multiple disparate standards for identifying, measuring, and reporting ESG metrics, including ESG-related disclosures that may be required by the SEC, European, and other regulators.
At the request of our clients, we have reported on various disclosure frameworks and standards, and the interpretation or application of those frameworks and standards may change from time to time or may not meet the expectations of our clients, investors or other stakeholders. 8 Furthermore, our processes and controls for reporting ESG matters across our operations and supply chain are evolving along with multiple disparate standards for identifying, measuring, and reporting ESG metrics, including ESG-related disclosures that may be required by various regulators.
If clients terminate a significant number of our staffing and consulting agreements or do not use us for future assignments and we are unable to generate new work to replace lost revenues, the growth of our business could be adversely affected, and our revenues and results of operations could be harmed.
As such, clients are free to place orders with our competitors. If clients terminate a significant number of agreements or do not use us for future IT services support , we may be unable to generate new work to replace lost revenues.
If we are not able to comply with performance requirements, our revenues and relationships with our clients may be adversely affected.
In addition, if we are not able to comply with performance requirements laid out in the consultant contract, our revenues and client relationships may be adversely affected. It is therefore imperative to our continued growth that we maintain positive relationships with our clients.
Such increased scrutiny may result in increased costs, enhanced compliance or disclosure obligations, or other adverse impacts on our business, financial condition, or results of operations. Further, our brand and reputation are associated with our public commitments to various corporate ESG initiatives, including our goals relating to sustainability.
Requirements to report on our ESG practices may therefore result in increased costs, enhanced compliance or disclosure obligations, or other adverse impacts on our business, financial condition, or results of operations.
As a result, it is imperative to our business that we maintain positive relationships with our clients. In our consulting business, clients may delay or cancel bookings which may cause expected revenues to be realized in a later period or not at all.
The growth of our business could be adversely affected, and our revenues and results of operations could be harmed. Specifically with regards to our longer-term consulting contracts, clients may delay or cancel bookings. This may cause expected revenues to be realized in a later period or not at all.
In conducting our business, we routinely collect and retain personal information on these systems about our employees and billing professionals and their dependents. Any information-technology systems are at risk of being compromised, whether through malicious activity or human or technological error.
Any information technology systems are at risk of being compromised, including through malicious activity or human or technological error.
If our internal controls are unsuccessful, our business and results of operations could be adversely affected. 12 The trading price of our common stock has experienced significant volatility.
The trading price of our common stock has experienced significant volatility.
AI, including GenAI, is a growing component of our business in both the commercial market and government space. We work both internally and with our enterprise customer base to develop strategic use cases for GenAI technologies.
We develop and utilize artificial intelligence, including generative artificial intelligence, machine learning, and similar tools and technologies that collect, aggregate, analyze, or generate data or other materials or content (collectively, “AI”) in connection with our business . AI, including GenAI, is a growing component of our business in both the commercial and government markets.
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As such, clients are free to place orders with our competitors.
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There are significant risks involved in using AI; for example, AI algorithms may be flawed, insufficient, of poor quality, rely upon incomplete or inaccurate data, reflect unwanted forms of bias, or contain other errors or inadequacies, any of which may not be easily detectable despite internal policies and diligence efforts in place to mitigate such deficiencies.
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Because the techniques used in cyber attacks change frequently and may be difficult to detect for periods of time, we may face difficulties in anticipating and implementing adequate security measures to prevent security breaches.
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If the AI that we use produces deficient, inaccurate, unethical, or controversial results, or if public opinion of AI is adversely affected due to actual or perceived risks regarding the usage of AI, we could incur operational inefficiencies, competitive harm, legal liability, brand or reputational harm, or other adverse impacts on our business and results of operations.
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Our disclosures on these matters and any failure or perceived failure to achieve or accurately report on our commitments, could harm our reputation and adversely affect our client relationships or our recruitment and retention efforts, as well as expose us to potential legal liability.
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Although we conduct diligence on third-party AI developers, we will not be able to control the manner in which third-party AI technologies are developed or maintained. Legal and regulatory frameworks related to the use of AI are rapidly evolving worldwide, including due to the perceived or actual risks of bias, unfair discrimination, transparency, and information security.
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Increasing focus on ESG matters has resulted in, and is expected to continue to result in, the adoption of legal and regulatory requirements designed to mitigate the effects of climate change on the environment, as well as legal and regulatory requirements requiring climate-related disclosures.
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In conducting our business, we and certain of our third-party providers routinely collect, retain, and process data about customers, employees, business partners, and others, including personally identifiable information (PII) on these systems about our employees and billing professionals and their dependents, as well as sensitive and/or proprietary information belonging to our business such as trade secrets (collectively, “Confidential Information”).
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If new laws or regulations are more stringent than current legal or regulatory requirements, we may experience increased compliance burdens and costs to meet such obligations.
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Successful cyberattacks can result in third parties gaining unauthorized access to our information technology systems for purposes of misappropriating assets or confidential information, corrupting data, or causing operational disruption.
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Our selection or application of disclosure frameworks and standards, and the interpretation or application of those frameworks and standards, may change from time to time or may not meet the expectations of investors or other stakeholders.
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Moreover, we have acquired and continue to acquire companies with cybersecurity vulnerabilities and/or unsophisticated security measures, which exposes us to significant cybersecurity, operational, and financial risks.
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Our development and use of emerging AI services and solutions involves risks and uncertainties that could expose us to legal, reputational, and financial harm. Applicable laws and regulations, both existing and forthcoming, often focus on AI use when that technology is used to influence outcomes or make inferences about individuals, groups, or communities.
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Remote and hybrid working arrangements at our company (and at many third-party providers) also increase cybersecurity risks due to the challenges associated with managing remote computing assets and security vulnerabilities that are present in many non-corporate and home networks.
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These new and emerging technologies require use-case-specific governance, with oversight that adequately addresses AI-specific areas of concern, such as transparency, explainability, fairness, harmful bias mitigation, and unique third-party privacy and security risks.
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Additionally, any integration of artificial intelligence in our or any service providers’ operations, products or services is expected to pose new or unknown cybersecurity risks and challenges.
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If we fail to establish and maintain sufficient oversight, which evolves at the rapid pace with which AI technology is changing, we could be subject to sanctions under the relevant laws, breach of contract claims, contract termination, class action, or individual lawsuits from affected parties, negative press articles, reputational damage, and a loss of confidence from our clients, all of which could adversely affect our existing business, future opportunities, and financial condition.
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Because our products and services are integrated with our customers’ systems and processes, any circumvention or failure of our cybersecurity defenses or measures could compromise the confidentiality, integrity, and availability of our customers’ own IT systems or Confidential Information as well.
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As the Company continues to expect to have key personnel retire, we need to implement appropriate succession plans, and if we cannot attract and retain qualified personnel or effectively implement appropriate succession plans, it could have a material adverse impact to our business, financial condition, and/or results of operations.
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Because the techniques used in cyber attacks change frequently and threat actors are becoming increasingly sophisticated in using techniques and tools—including artificial intelligence—that circumvent security controls, evade detection and remove forensic evidence, despite maintaining robust detection and remediation efforts, we may face difficulties in detecting, investigating, remediating or recovering from future attacks or incidents, or to avoid a material adverse impact to our IT systems, Confidential Information or business.
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We cannot guarantee that any costs and liabilities incurred in relation to an attack or incident will be covered by our existing insurance policies or that applicable insurance will be available to us in the future on economically reasonable terms or at all. For information on our cybersecurity risk management, strategy, and governance, see Item 1C. Cybersecurity.
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Moreover, our revenues and operating results could be adversely affected if any prime contractor chose to offer directly to the customer services of the type that we provide, or if they team with other companies to provide those services.
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In addition, we receive, store, use and otherwise process information that relates to individuals and/or constitutes “personal information” or similar terms under applicable data privacy laws, including from and about our employees and business contacts.
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We also depend on a number of third-party vendors in relation to the operation of our business, a number of which process personal information on our behalf.
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The application and interpretation of data privacy laws are constantly evolving and are subject to change, creating a complex compliance environment. In some cases, these requirements may be either unclear in their interpretation and application or they may have inconsistent or conflicting requirements with each other.
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Further, there has been a substantial increase in legislative activity and regulatory focus on data privacy and security in the United States and elsewhere, including in relation to cybersecurity incidents.
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Any non-compliance or perceived non-compliance with the data privacy laws applicable to our business could result in legal claims or proceedings (including class actions), governmental enforcement actions and investigations, fines, and other penalties that could potentially have an adverse effect on our operations and reputation.
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General Risks The loss of key members of our senior management team, as well as failure to develop the next generation of future leaders, could adversely affect the execution of our business strategy and our financial results.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeTwo key enabling bodies, ASGN’s Enterprise Security Council and the Security Operations Center (“SOC”), have primary responsibility for our overall cybersecurity risk management program and provide the structure necessary to set policy and direction as well as operationalize our required security posture. • Our CIOs lead our internal Enterprise Security Council collectively representing ASGN and its Segments which reports to our Chief Executive Officer and the Board's Strategy and Technology Committee.
Biggest changeBoard members receive presentations on cybersecurity topics from the Company's chief information officers across our brands ("CIOs") and external experts as part of the Board's continuing education on topics that impact public companies. 13 Two key enabling bodies, ASGN’s Enterprise Security Council ("Council") and the Security Operations Center (“SOC”), have primary responsibility for our overall cybersecurity risk management program and provide the structure necessary to set policy and direction as well as operationalize our required security posture. • The Council includes the CIOs and is led by the Chief Information Security Officer ("CISO").
The council's primary mandate is to formulate comprehensive data protection and cybersecurity policies for ASGN, oversee the management of emerging security threats, proactively mitigate security risks, and safeguard our valuable assets. • ECS Federal, LLC ("ECS"), ASGN’s Federal Government Segment, plays a vital role in safeguarding ASGN through its essential security control function.
The Council's primary mandate is to formulate comprehensive data protection and cybersecurity policies for ASGN, oversee the management of emerging security threats, proactively mitigate security risks, and safeguard our valuable assets. • ECS, ASGN’s Federal Government Segment, plays a vital role in safeguarding ASGN through its essential security control function.
In 2023, ASGN has not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial conditions.
In 2024, ASGN has not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial conditions.
We conduct continuous active hunts and forensic analysis inspections on our network, proactively seeking out malware and intrusions. 14
We conduct continuous active hunts and forensic analysis inspections on our network, proactively seeking out malware and intrusions.
All ASGN’s brands align to the Department of Defense’s Cybersecurity Maturity Model Certification (“CMMC”) 2.0 framework and have implemented common technology and data protection and cybersecurity controls and processes, which provides a unified approach to our cybersecurity measures.
All ASGN brands align to the Department of Defense’s Cybersecurity Maturity Model Certification (“CMMC”) 2.0 framework and have implemented common technology and data protection and cybersecurity controls and processes, which provides a unified approach to our cybersecurity measures.
These leaders bring a wealth of experience in security operations, business process re-engineering, software development, ERP systems, and the management of multinational wide area networks. Complementing this expertise, the Enterprise Security Council includes a dedicated team of Cybersecurity Information Professionals (CISP), consisting of brand-specific system engineers and security administrators.
The Council members bring a wealth of experience in security operations, business process re-engineering, software development, ERP systems, and the management of multinational wide area networks. Complementing this expertise, the Council also includes a dedicated team of Cybersecurity Information Security Professionals, consisting of brand-specific system engineers and security administrators.
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Board members receive presentations on cybersecurity topics from the Company's chief information officers across our brands ("CIOs") and external experts as part of the Board's continuing education on topics that impact public companies.
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This does not imply that we meet any particular technical standards, specifications, or requirements, only that we use the CMMC 2.0 framework as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business.
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Our CISO joined the Company in 2018 in connection with the acquisition of ECS Federal, LLC ("ECS") and has decades of experience in oversight of cybersecurity operations. Collectively, the Council represents ASGN and its brands, and reports to the Chief Executive Officer and the Board's Strategy and Technology Committee.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeLocation Square Feet Lease Expiration ASGN and Commercial Segment Headquarters Richmond, Virginia 78,000 April 2027 Federal Government Segment Headquarters Fairfax, Virginia 46,200 November 2029 Branch offices (1) United States, Canada, United Kingdom, and Spain 695,200 January 2024 through January 2030 Delivery Centers Mexico and India 84,700 May 2024 through December 2027 ___________________ (1) We have 113 branch office locations that occupy spaces ranging from approximately 1,683 to 47,000 square feet with lease terms that range from one year to 12.6 years.
Biggest changeLocation Square Feet Lease Expiration ASGN and Commercial Segment Headquarters Richmond, Virginia 78,000 April 2027 Federal Government Segment Headquarters Fairfax, Virginia 46,200 November 2029 Branch offices (1) United States, Canada, and United Kingdom 628,700 January 2025 through March 2033 Delivery Centers Mexico and India 84,700 June 2025 through December 2027 ___________________ (1) We have approximately 100 branch office locations that occupy spaces ranging from approximately 1,668 to 40,839 square feet with lease terms that range from one year to 13.3 years.
Item 2. Properties As of December 31, 2023, we leased office space in the following locations. We believe that our facilities are suitable and adequate for our current operations.
Item 2. Properties As of December 31, 2024, we leased office space in the following locations. We believe that our facilities are suitable and adequate for our current operations.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings We are involved in various legal proceedings, claims, and litigation arising in the ordinary course of business, including collective class and PAGA actions alleging violations of wage and hour laws.
Biggest changeItem 3. Legal Proceedings We are involved in various legal proceedings, investigations, claims, and litigation arising in the ordinary course of business, including collective class and PAGA actions alleging violations of wage and hour laws.
However, based on the facts currently available, we do not believe that the disposition of matters that are pending or asserted will have a material effect on our financial position, results of operations, or cash flows. Item 4. Mine Safety Disclosures Not applicable. 15 PART II
However, based on the facts currently available, we do not believe that the disposition of matters that are pending or asserted will have a material effect on our financial position, results of operations, or cash flows. Item 4. Mine Safety Disclosures Not applicable. 14 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plan — Information responsive to this item will be set forth in the Company’s definitive proxy statement for use in connection with its 2024 Annual Meeting of Stockholders (the "2024 Proxy Statement") to be filed with the SEC within 120 days after the end of the Company’s fiscal year and is incorporated herein by reference.
Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plan — Our equity compensation plan information required by this items is incorporated by reference to the information in Part III, Item 12 of this 2024 10-K.
Under terms of the programs, purchases can be made in the open market or under a Rule 10b5-1 trading plan. The stock repurchase program does not obligate the Company to acquire any particular amount of the Company's stock and may be suspended at any time at the Company's discretion.
Under terms of the program, purchases can be made in the open market or under a Rule 10b5-1 trading plan. The stock repurchase program does not obligate the Company to acquire any particular amount of the Company's stock and may be suspended at any time at the Company's discretion.
These shares are excluded from the table above. During the three months ended December 31, 2023, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K. Item 6. Selected Financial Data None.
These shares are excluded from the table above. During the three months ended December 31, 2024, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K. Item 6. Selected Financial Data None.
The Company's repurchases of its common stock during the three months ended December 31, 2023, and the approximate dollar value of shares that may be purchased under the program as of December 31, 2023, are shown in the table below.
The Company's repurchases of its common stock during the three months ended December 31, 2024, and the approximate dollar value of shares that may be purchased under the program as of December 31, 2024, are shown in the table below.
Stock Performance Graph — The following graph compares the performance of ASGN’s common stock price during the period from December 31, 2018 to December 31, 2023 with the composite prices of companies listed on the NYSE and of companies included in the SIC Code No. 736—Personnel Supply Services Companies Index.
Stock Performance Graph — The following graph compares the performance of ASGN’s common stock price during the period from December 31, 2019 to December 31, 2024 with the composite prices of companies (i) listed on the NYSE, (ii) included in the SIC Code No. 7389—Business Services, Not Elsewhere Classified ("Business Services"), and (iii) included in the SIC Code No. 736—Personnel Supply Services Companies ("Personnel Supply Services").
At February 15, 2024 we had 46.5 million shares outstanding, 23 holders of record and an indeterminate number of beneficial owners of our common stock held through brokers and other intermediaries.
At February 14, 2025 we had 43.6 million shares outstanding, 22 holders of record and an indeterminate number of beneficial owners of our common stock held through brokers and other intermediaries.
The comparisons shown in the graph below are based upon historical data, and we caution stockholders that the stock price performance shown in the graph below is not indicative of, nor intended to forecast, potential future performance.
The graph depicts the results of investing $100 on December 31, 2019, and assumes that dividends were reinvested, where applicable, during the period. The comparisons shown in the graph below are based upon historical data, and we caution stockholders that the stock price performance shown in the graph below is not indicative of, nor intended to forecast, potential future performance.
Common Stock Repurchases — On April 24, 2023, the Company's Board approved a new stock repurchase program under which the Company may repurchase up to $500.0 million of its common stock over the following two years and this replaces the previous program.
Common Stock Repurchases — On April 24, 2024, the Company announced that the Company's Board had approved a new stock repurchase program under which the Company may repurchase $750.0 million of its common stock over the following two years and prior authorization amounts were cancelled.
Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plan Approximate Dollar Value of Shares That May Yet be Purchased Under the Plan (in millions) October 320,306 $ 81.10 320,306 $ 323.1 November 335,701 $ 87.67 335,701 $ 293.7 December 213,340 $ 93.71 213,340 $ 273.7 Total 869,347 $ 86.73 869,347 $ 273.7 In connection with our stock-based compensation plans, during the three months ended December 31, 2023, common stock totaling 30,130 shares with an aggregate value of $2.6 million were tendered by employees for payment of applicable statutory tax withholdings.
Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plan Approximate Dollar Value of Shares That May Yet be Purchased Under the Plan (in millions) October 1-31, 2024 115,909 $ 94.71 115,909 $ 561.9 November 1-30, 2024 135,970 $ 91.93 135,970 $ 549.4 December 1-31, 2024 239,758 $ 87.15 239,758 $ 528.5 Total 491,637 $ 90.25 491,637 $ 528.5 In connection with our stock-based compensation plans, during the three months ended December 31, 2024, common stock totaling 22,086 shares with an aggregate value of $2.1 million w ere tendered by employees for payment of applicable statutory tax withholdings.
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The graph depicts the results of investing $100 in our common stock, the NYSE market index, and an index of the companies listed in the SIC Code No. 736 on December 31, 2018, and assumes that dividends were reinvested, where applicable, during the period.
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At December 31, 2019 2020 2021 2022 2023 2024 ASGN $ 100.00 $ 117.70 $ 173.88 $ 114.81 $ 135.51 $ 117.43 Business Services $ 100.00 $ 135.14 $ 112.13 $ 86.02 $ 109.50 $ 125.59 Personnel Supply Services $ 100.00 $ 106.69 $ 142.56 $ 105.25 $ 115.77 $ 85.28 NYSE Market Index $ 100.00 $ 106.99 $ 129.11 $ 117.04 $ 133.16 $ 154.19 15 Recent Sales of Unregistered Securities — None.
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At December 31, 2018 2019 2020 2021 2022 2023 ASGN $ 100.00 $ 130.22 $ 153.27 $ 226.42 $ 149.50 $ 176.46 SIC Code No. 736 Index $ 100.00 $ 122.83 $ 132.23 $ 180.23 $ 128.44 $ 138.26 NYSE Market Index $ 100.00 $ 125.74 $ 134.53 $ 162.34 $ 147.16 $ 167.43 16 Recent Sales of Unregistered Securities — None.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

35 edited+17 added−8 removed6 unchanged
Biggest changeBy review of macroeconomic conditions, industry and market conditions, cost factors, overall financial performance compared with prior projections, and other relevant entity-specific events, we determined it was more likely than not that the fair value of each reporting unit exceeded its carrying amount.
Biggest changeA qualitative assessment takes into consideration (i) macroeconomic, industry and market conditions; (ii) cost factors; (iii) overall financial performance compared with prior projections, including changes in assumptions since the last quantitative assessment; (iv) future performance and projections; (v) the excess of fair value over carrying value as of the most recent quantitative assessment performed; and (vi) other relevant entity-specific events.
Net cash used in financing activities in 2023 was $310.9 million, and primarily consisted of $273.1 million to repurchase the Company's common stock, net repayments of borrowings under the revolving credit facility totaling $31.5 million, a required quarterly principal payment of $1.3 million on the term loan B, as well as the effects of the August 2023 amendments to the Company's senior secured credit facility which generated net proceeds of $8.0 million that were offset by related amendment costs.
Net cash used in financing activities in 2023 was $310.9 million and primarily consisted of $273.1 million to repurchase the Company's common stock, net repayments of borrowings under the revolving credit facility totaling $31.5 million, a required quarterly principal payment of $1.3 million on the term loan B, as well as the effects 17 of the August 2023 amendments to the Company's senior secured credit facility which generated net proceeds of $8.0 million that were offset by related amendment costs.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with the other sections of this 2023 10-K, including the Special Note on Forward-Looking Statements and Part I, Item 1A. Risk Factors. OVERVIEW ASGN provides information technology ("IT") services and solutions across the commercial and government sectors.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with the other sections of this 2024 10-K, including the Special Note on Forward-Looking Statements and Part I, Item 1A. Risk Factors. OVERVIEW ASGN provides information technology ("IT") services and solutions across the commercial and government sectors.
The book-to-bill ratio for our commercial consulting revenues is the ratio of Bookings to commercial consulting revenues for a specified period. The average duration of commercial consulting projects is one year.
The book-to-bill ratio for our commercial consulting revenues is the ratio of Bookings to commercial consulting revenues for a specified period. The average duration of commercial consulting projects is approximately one year.
For a discussion of the year ended December 31, 2022 compared with the year ended December 31, 2021, please refer to Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2022.
For a discussion of the year ended December 31, 2023 compared with the year ended December 31, 2022, please refer to Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2023.
Year Ended December 31, (Dollars in millions) 2023 2022 2021 Bookings $ 1,351.9 $ 1,192.2 $ 810.3 Book-to-Bill Ratio 1.2 to 1 1.2 to 1 1.3 to 1 Federal Government Segment Metrics Contract backlog for our Federal Government Segment represents the estimated amount of future revenues to be recognized under awarded contracts, including task orders and options, at a point in time ("Contract Backlog").
Year Ended December 31, (Dollars in millions) 2024 2023 2022 Bookings $ 1,281.3 $ 1,351.9 $ 1,192.2 Book-to-Bill Ratio 1.1 to 1 1.2 to 1 1.2 to 1 Federal Government Segment Metrics Contract backlog for our Federal Government Segment represents the estimated amount of future revenues to be recognized under awarded contracts, including task orders and options, at a point in time ("Contract Backlog").
The workers' compensation loss reserves were $3.0 million and $2.6 million, net of anticipated insurance and indemnification recoveries of $10.5 million and $10.2 million, at December 31, 2023 and 2022, respectively. We have undrawn stand-by letters of credit outstanding to secure obligations for workers’ compensation claims and other obligations.
The workers' compensation loss reserves were $2.8 million and $3.0 million, net of anticipated insurance and indemnification recoveries of $10.5 million and $10.5 million, at December 31, 2024 and 2023, respectively. We have undrawn stand-by letters of credit outstanding to secure obligations for workers’ compensation claims and other obligations.
RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2023 COMPARED WITH THE YEAR ENDED DECEMBER 31, 2022 In this section, we discuss the results of our operations for the year ended December 31, 2023 compared with the year ended December 31, 2022.
RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2024 COMPARED WITH THE YEAR ENDED DECEMBER 31, 2023 In this section, we discuss the results of our operations for the year ended December 31, 2024 compared with the year ended December 31, 2023.
We believe that our cash and cash equivalents on hand, expected operating cash flows, and availability under our revolving credit facility will be sufficient to fulfill our obligations, working capital requirements, and capital expenditures for the next 12 months. Net cash provided by operating activities was $456.9 million in 2023, compared with $307.8 million in 2022.
We believe that our cash and cash equivalents on hand, expected operating cash flows, and availability under our revolving credit facility will be sufficient to fulfill our obligations, working capital requirements, and capital expenditures for the next 12 months. Net cash provided by operating activities was $400.0 million in 2024, compared with $456.9 million in 2023.
Financial Statements and Supplementary Data . 18 We have retention policies for our workers’ compensation liability exposures. The workers' compensation loss reserves are based upon an actuarial report obtained from a third party and determined based on claims filed and claims incurred but not reported.
We have retention policies for our workers’ compensation liability exposures. The workers' compensation loss reserves are based upon an actuarial report obtained from a third party and are determined based on claims filed and claims incurred but not reported.
Virtually all of the Company's revenues are generated in the United States. Critical Accounting Policies and Estimates Our financial statements are prepared in conformity with accounting principles generally accepted in the United States ("GAAP"), which require us to make certain assumptions and related estimates affecting the amounts reported in the consolidated financial statements. Actual results could differ from those estimates.
Critical Accounting Policies and Estimates Our financial statements are prepared in conformity with accounting principles generally accepted in the United States ("GAAP"), which require us to make certain assumptions and related estimates affecting the amounts reported in the consolidated financial statements. Actual results could differ from those estimates.
Net Income Net income was $219.3 million in 2023, down from $268.1 million in 2022. Commercial Segment - Consulting Metrics Commercial consulting bookings are the value of new contracts entered into during a specified period, including adjustments for the effects of changes in contract scope and contract terminations ("Bookings").
Net Income Net income was $175.2 million, down from $219.3 million in 2023. 16 Commercial Segment - Consulting Metrics Commercial consulting bookings are the value of new contracts entered into during a specified period, including adjustments for the effects of changes in contract scope and contract terminations ("Bookings").
(2) Represents the future minimum lease payments for non-cancelable operating leases. (3) Purchase obligations are non-cancelable job board service agreements and software subscriptions, maintenance, and license agreements. For additional information about these contractual cash obligations, see Notes 5. Leases, 9. Long-Term Debt and 10. Commitments and Contingencies in Item 8.
(2) Represents the future minimum lease payments for non-cancelable operating leases. (3) Purchase obligations are non-cancelable job board service agreements and software subscriptions, maintenance, and license agreements. For additional information about these contractual cash obligations, see Notes 4. Leases, 8. Long-Term Debt and 9. Commitments and Contingencies in Item 8. Financial Statements and Supplementary Data .
Our cash flows from operating activities have been our primary source of liquidity and have been sufficient to fund our working capital and capital expenditure needs. At December 31, 2023, we had full availability of our $500.0 million revolving credit facility.
Our cash flows from operating activities have been our primary source of liquidity and have been sufficient to meet our working capital and capital expenditure needs. At December 31, 2024, we had full availability under the $500.0 million revolving credit facility.
Gross Profit Gross Margin 2023 2022 Change 2023 2022 Change Commercial $ 1,017.6 $ 1,126.2 (9.6) % 32.1 % 32.8 % (0.7) % Federal Government 262.4 243.4 7.8 % 20.6 % 21.3 % (0.7) % Consolidated $ 1,280.0 $ 1,369.6 (6.5) % 28.8 % 29.9 % (1.1) % Gross profit is comprised of revenues less costs of services, which consist primarily of compensation for our billable professionals, other direct costs, and reimbursable out-of-pocket expenses.
Gross Profit Gross Margin 2024 2023 Change 2024 2023 Change Commercial $ 932.9 $ 1,017.6 (8.3) % 32.5 % 32.1 % 0.4 % Federal Government 250.8 262.4 (4.4) % 20.4 % 20.6 % (0.2) % Consolidated $ 1,183.7 $ 1,280.0 (7.5) % 28.9 % 28.8 % 0.1 % Gross profit is comprised of revenues less costs of services, which consist primarily of compensation for our contract professionals, other direct costs, and reimbursable out-of-pocket expenses.
Stock-Based Compensation and Other Employee Benefit Plans in Item 8. Financial Statements and Supplementary Data ). Off-Balance Sheet Arrangements As of December 31, 2023, we had no off-balance sheet arrangements. Accounting Standards Updates See Note 3. Accounting Standards Update in Item 8. Financial Statements and Supplementary Data for a discussion of new accounting pronouncements.
Off-Balance Sheet Arrangements As of December 31, 2024, we had no off-balance sheet arrangements. Accounting Standards Updates See Note 3. Accounting Standards Update in Item 8. Financial Statements and Supplementary Data for a discussion of new accounting pronouncements.
The weighted-average outstanding borrowings and cash-based interest rate were $1.1 billion and 5.9 percent (excluding costs related to the aforementioned amendments) in 2023, and $1.0 billion and 4.1 percent in 2022. Provision for Income Taxes The provision for income taxes was $78.4 million, down from $96.7 million in 2022 due to lower income before income taxes.
The weighted-average outstanding borrowings for 2024 and 2023 were $1.05 billion and the cash-based interest expense rate was 6.0 percent and 5.9 percent (excluding interest income and costs related to debt amendments), respectively. Provision for Income Taxes The provision for income taxes was $64.9 million, down from $78.4 million in 2023 due to lower income before income taxes.
Federal Government Segment revenues, which are all consulting revenues, were $1.3 billion, up 11.4 percent year-over-year as stated above, and Commercial Segment consulting revenues were $1.1 billion, up 14.2 percent year-over-year.
Federal Government Segment revenues, which are all consulting revenues, were $1.2 billion, down 3.5 percent year-over-year as stated above. Commercial Segment consulting revenues were $1.1 billion, up 3.0 percent year-over-year.
Contract backlog coverage ratio is calculated as total Contract Backlog divided by TTM revenues. 17 Year Ended December 31, (Dollars in millions) 2023 2022 2021 New Contract Awards $ 1,022.2 $ 1,073.3 $ 1,157.0 Book-to-Bill Ratio 0.8 to 1 0.9 to 1 1.1 to 1 December 31, (Dollars in millions) 2023 2022 2021 Funded Contract Backlog $ 543.5 $ 582.3 $ 529.2 Negotiated Unfunded Contract Backlog 2,466.0 2,681.2 2,472.0 Contract Backlog $ 3,009.5 $ 3,263.5 $ 3,001.2 Contract Backlog Coverage Ratio 2.4 to 1 2.9 to 1 2.6 to 1 Liquidity and Capital Resources Our working capital, which is current assets less current liabilities, at December 31, 2023 was $579.2 million, and our cash and cash equivalents were $175.9 million.
Year Ended December 31, (Dollars in millions) 2024 2023 2022 New Contract Awards $ 1,340.5 $ 1,022.2 $ 1,073.3 Book-to-Bill Ratio 1.1 to 1 0.8 to 1 0.9 to 1 December 31, (Dollars in millions) 2024 2023 2022 Funded Contract Backlog $ 529.0 $ 543.5 $ 582.3 Negotiated Unfunded Contract Backlog 2,589.6 2,466.0 2,681.2 Contract Backlog $ 3,118.6 $ 3,009.5 $ 3,263.5 Contract Backlog Coverage Ratio 2.5 to 1 2.4 to 1 2.9 to 1 Liquidity and Capital Resources Our working capital, which is current assets less current liabilities, at December 31, 2024 was $550.6 million, and our cash and cash equivalents were $205.2 million.
Commercial revenues fall into five broad industry verticals: (i) Financial Services, (ii) Consumer and Industrials, (iii) Healthcare, (iv) Technology, Media and Telecom, and (v) Business and Government Services. The Consumer and Industrials industry vertical had low single-digit growth, while the remaining four industry verticals declined year-over-year.
Commercial Segment revenues (70.0 percent of total revenues) were down 9.6 percent year-over-year and are categorized into five broad industry verticals: (i) Financial Services, (ii) Consumer and Industrials, (iii) Healthcare, (iv) Technology, Media and Telecom ("TMT"), and (v) Business and Government Services. The TMT industry vertical had low single-digit growth, while the remaining four industry verticals declined year-over-year.
These estimates are subject to change and may be affected by the execution of new contracts, the extension or early termination of existing contracts, the non-renewal or completion of current contracts, and adjustments to estimates for previously included contracts.
These estimates are subject to change and may be affected by the execution of new contracts, the extension or early termination of existing contracts, the non-renewal or completion of current contracts, and adjustments to estimates for previously included contracts. There is no assurance our contract backlog will result in future revenues.
ASGN operates through two segments, Commercial and Federal Government. The Commercial Segment, which is the largest segment, provides consulting, creative digital marketing, and permanent placement services primarily to large enterprises and Fortune 1000 companies. The Federal Government Segment provides mission-critical solutions to the Department of Defense, the intelligence community, and federal civilian agencies.
ASGN operates through two segments, Commercial and Federal Government. The Commercial Segment, which is the largest segment, provides consulting, creative digital marketing, and permanent placement services primarily to Fortune 1000 and large mid-market companies.
The table below shows our revenues by segment (in millions). % of Total 2023 2022 Change 2023 2022 Change Commercial: Assignment $ 2,078.9 $ 2,476.1 (16.0) % 46.7 % 54.1 % (7.4) % Consulting 1,095.5 959.6 14.2 % 24.6 % 20.9 % 3.7 % 3,174.4 3,435.7 (7.6) % 71.3 % 75.0 % (3.7) % Federal Government 1,276.2 1,145.4 11.4 % 28.7 % 25.0 % 3.7 % Consolidated $ 4,450.6 $ 4,581.1 (2.8) % 100.0 % 100.0 % From an industry perspective, the Company operates in six broad industry verticals.
The table below shows our revenues by segment (in millions). % of Total 2024 2023 Change 2024 2023 Change Commercial: Assignment $ 1,740.5 $ 2,078.9 (16.3) % 42.5 % 46.7 % (4.2) % Consulting 1,128.2 1,095.5 3.0 % 27.5 % 24.6 % 2.9 % 2,868.7 3,174.4 (9.6) % 70.0 % 71.3 % (1.3) % Federal Government 1,231.0 1,276.2 (3.5) % 30.0 % 28.7 % 1.3 % Consolidated $ 4,099.7 $ 4,450.6 (7.9) % 100.0 % 100.0 % From an industry perspective, the Company operates in six broad industry verticals.
Commitments and Contingencies — The following table sets forth, on an aggregate basis, the amounts of specified contractual cash obligations required to be paid in the future periods shown (in millions): Contractual Obligations Less than 1 year 1-3 years 3-5 years More than 5 years Total Long-term debt obligations (1) $ 69.8 $ 138.4 $ 669.6 $ 533.4 $ 1,411.2 Operating Leases (2) 22.8 34.4 16.3 2.5 76.0 Purchase obligations (3) 23.2 24.4 0.1 — 47.7 $ 115.8 $ 197.2 $ 686.0 $ 535.9 $ 1,534.9 _______ (1) Long-term debt obligations include principal payments and estimated interest and fees calculated based on the rates in effect at December 31, 2023.
Commitments and Contingencies — The following table sets forth, on an aggregate basis, the amounts of specified contractual cash obligations required to be paid in the future periods shown (in millions): Less than 1 year 1-3 years 3-5 years More than 5 years Total Long-term debt obligations (1) $ 62.0 $ 123.2 $ 627.7 $ 487.8 $ 1,300.7 Operating Leases (2) 22.5 33.3 15.5 2.7 74.0 Purchase obligations (3) 29.2 13.9 0.5 — 43.6 $ 113.7 $ 170.4 $ 643.7 $ 490.5 $ 1,418.3 _______ (1) Long-term debt obligations include principal payments and estimated interest and fees calculated based on the rates in effect at December 31, 2024.
The undrawn stand-by letters of credit were $3.9 million at December 31, 2023 and 2022. We have a deferred compensation plan liability of $16.6 million and $13.6 million at December 31, 2023 and 2022, which was primarily included in other long-term liabilities. We established a rabbi trust to fund the deferred compensation plan (see Note 12.
The undrawn stand-by letters of credit were $3.7 million at December 31, 2024 and 2023. We have a deferred compensation plan liability of $17.8 million and $16.6 million at December 31, 2024 and 2023, which was primarily included in other long-term liabilities in the accompanying consolidated balance sheets.
Net cash provided by operating activities before changes in operating assets and liabilities was $400.8 million, compared with $448.5 million in 2022. Changes in operating assets and liabilities resulted in net cash generation of $56.1 million, compared with net cash usage of $140.7 million in 2022.
Net cash provided by operating activities before changes in operating assets and liabilities was $353.9 million, compared with $400.8 million in 2023. Net cash provided by changes in operating assets and liabilities was $46.1 million, compared with $56.1 million in 2023.
When evaluating goodwill for impairment, we may first perform a qualitative assessment (“step zero” of the impairment test) to determine whether it is more likely than not that a reporting unit is impaired.
When evaluating goodwill and trademarks for impairment, the Company may first perform a qualitative assessment to determine whether it is more likely than not that there has been an impairment.
If we decide not to perform a qualitative assessment, or if we determine that it is more likely than not the carrying amount of a reporting unit exceeds its fair value, then we perform a quantitative assessment (“step one” of the impairment test), and calculate the estimated fair value of the reporting unit.
If the Company decides not to perform a qualitative assessment, or if it determines that it is more likely than not that the carrying amount of goodwill or trademarks exceeds their fair value, a quantitative assessment is performed to determine the estimated fair value of the reporting unit or trademark.
The growth in IT consulting services revenues was offset by a 16.0 percent year-over-year decline in assignment revenues which totaled $2.1 billion (46.7 percent of total revenues), reflecting continued softness in the more discretionary and cyclical portions of the Commercial Segment business. Gross Profit and Gross Margin The table below shows gross profit and gross margin by segment (in millions).
Assignment revenues, which totaled $1.7 billion (42.5 percent of total revenues), were down 16.3 percent year-over-year, reflecting continued softness in the portions of the Commercial Segment Business that are more sensitive to changes in the macroeconomic cycles (i.e., more cyclical). Gross Profit and Gross Margin The table below shows gross profit and gross margin by segment (in millions).
If the carrying amount of the reporting unit exceeds the estimated fair value, an impairment charge would be recorded to reduce the carrying amount to its estimated fair value. We performed a qualitative assessment for the October 31, 2023 annual impairment evaluation for all reporting units.
As a result of a quantitative assessment, if the carrying amount exceeds the estimated fair value, an impairment charge would be recorded to reduce the carrying amount of the trademark.
Selling, General, and Administrative Expenses Selling, general, and administrative ("SG&A") expenses were $844.2 million (19.0 percent of revenues), compared with $895.0 million (19.5 percent of revenues) in 2022. This improvement was primarily due to lower incentive compensation expense. Amortization of Intangible Assets Amortization of intangible assets was $71.7 million, up from $65.1 million in 2022.
The decrease in SG&A expenses was primarily due to lower compensation-related expense. Amortization of Intangible Assets Amortization of intangible assets was $58.1 million, down from $71.7 million in 2023.
In 2022, net cash used in financing activities was $256.5 million and primarily consisted of $281.4 million of stock repurchases, as well as net borrowings under the revolving credit facility totaling $31.5 million. For details on the Company’s senior secured credit facility, comprised of a revolving credit facility and term loan B, and unsecured senior notes, see Note 9.
For details on the Company’s senior secured credit facility, comprised of a revolving credit facility and term loan B, and unsecured senior notes, see Note 8. Long-Term Debt in Item 8. Financial Statements and Supplementary Data.
Consolidated gross profit declined 6.5 percent on revenue decline of 2.8 percent. Gross margin was 28.8 percent, a compression of 110 basis points year-over-year.
Consolidated gross profit declined 7.5 percent on a revenue decline of 7.9 percent. Gross margin was 28.9 percent, an expansion of 10 basis points year-over-year, reflecting a higher mix of Commercial consulting revenues (which carry a higher gross margin than assignment revenues and Federal Government Segment revenues), as well as margin expansion in these revenues.
The effective tax rate of 26.3 percent was slightly lower than the effective tax rate of 26.6 percent for 2022. Income from Continuing Operations Income from continuing operations was $219.3 million, down from $266.9 million in 2022. Income from Discontinued Operations Income from discontinued operations was $1.2 million in 2022.
The effective tax rate of 27.0 percent was slightly higher than the effective tax rate of 26.3 percent in 2023.
Federal Government Segment revenues (28.7 percent of total revenues), the sixth industry vertical, were up 11.4 percent year-over-year and included $74.3 million from Iron Vine through its acquisition date anniversary, which was at the beginning of October 2023. Total IT consulting services revenues were $2.4 billion (53.3 percent of total revenues), up 12.7 percent year-over-year.
Federal Government Segment revenues (30.0 percent of total revenues), the sixth industry vertical, were down 3.5 percent year-over-year, reflecting lower third-party software licenses revenues compared with the prior year. Total IT consulting services revenues were $2.4 billion (57.5 percent of total revenues), down 0.5 percent year-over-year.
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Recoverability of Goodwill and Acquired Intangible Assets — Goodwill is evaluated for impairment annually or more frequently if an event occurs or circumstances change, such as a material deterioration in performance that would indicate an impairment may exist. We perform an annual impairment assessment as of October 31st for each of our reporting units.
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The Federal Government Segment provides advanced IT solutions to the Department of Defense, the intelligence community, and key federal civilian agencies, namely the Department of Homeland Security. Virtually all of the Company's revenues are generated in the United States.
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Revenues Revenues for the year were $4.5 billion, down 2.8 percent year-over-year. Revenues in 2023 included approximately $128.0 million from businesses acquired in the prior year through their acquisition date anniversaries. Excluding the contributions from acquisitions, revenues declined 5.6 percent year-over-year.
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Recoverability of Goodwill and Trademarks — Goodwill and trademarks are evaluated for impairment annually on October 31 st , or more frequently if an event occurs or circumstances change, including but not limited to, a significant decrease in expected revenues or cash flows; an adverse change in the business environment, regulatory environment or legal factors; or a substantial sustained decline in the market capitalization of our stock.
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Commercial Segment revenues (71.3 percent of total revenues) were down 7.6 percent year-over-year and included $53.6 million of revenues from the GlideFast business through its acquisition date anniversary, which was at the beginning of July 2023.
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Goodwill is tested at the reporting unit level, which is generally an operating segment or one level below the operating segment level, where a business operates and for which discrete financial information is available and reviewed by segment management. The Company's only identifiable indefinite-lived intangible assets are its trademarks.
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The compression mainly related to business mix: (i) within the Commercial Segment, a lower mix of certain high- margin assignment revenues, namely, creative digital marketing and permanent placement revenues, which was partially offset by a higher mix of high-margin IT consulting revenues with a year-over-year expansion in margin, and (ii) a higher mix of revenues from the Federal Government Segment, which have a lower gross margin than commercial revenues.
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The decision to perform a qualitative assessment in a given year is influenced by a number of factors including the significance of the excess of the estimated fair value over carrying amount at the last quantitative assessment date and the amount of time between quantitative fair value assessments.
Removed
This increase reflects a full year of amortization from businesses acquired in 2022. Interest Expense Interest expense was $66.4 million up from $45.9 million in 2022, primarily as a result of higher interest rates on the senior secured credit facility, and also included $2.3 million of costs related to the August 2023 amendments to the senior secured credit facility.
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To estimate the fair value of a reporting unit, quantitative analysis would generally include a combination of a discounted cash flow (“DCF”) model and a market approach. Key inputs to the DCF model would include (i) future revenues, (ii) earnings before interest, taxes depreciation and amortization and (iii) the weighted average cost of capital discount rate.
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This year-over-year change primarily related to lower accounts receivable due to lower revenues as well as improvement in accounts receivable days sales outstanding ("DSO"), compared with 2022 which had increasing accounts receivable due to revenue growth as well as an increase in DSO. Net cash used in investing activities in 2023 was $40.5 million and primarily consisted of capital expenditures.
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As a result of a quantitative assessment, if the carrying amount exceeds the estimated fair value, an impairment charge would be recorded to reduce the carrying amount of goodwill. To estimate the fair value of a trademark, quantitative analysis would generally include, an income approach, specifically a relief-from-royalty method.
Removed
In 2022, net cash used in investing activities was $510.0 million and included $484.6 million used to acquire two IT consulting businesses and $37.5 million in capital expenditures.
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For the 2024 impairment test of goodwill and trademarks, the Company performed a qualitative assessment and determined there were no indicators of impairment and it was more likely than not that the fair value of each of the reporting units, and the trademarks, exceeded their respective carrying amounts.
Removed
Long-Term Debt in Item 8. Financial Statements and Supplementary Data.
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For the 2024 goodwill impairment test, the Company had three reporting units: Apex, Creative Circle and Federal Government. Following the impairment test, the Company aggregated the Apex and Creative Circle reporting units into a single reporting unit, now known as the Commercial reporting unit.
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Before and after this change it is more likely than not the fair value of the Company's reporting units exceeded their carrying value.
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Revenues Revenues for the year were $4.1 billion, down 7.9 percent year-over-year.
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Selling, General, and Administrative Expenses Selling, general and administrative ("SG&A") expenses consist primarily of compensation expense for our field operations and corporate staff, rent, information systems, marketing, telecommunications, public company expenses and other general and administrative expenses. SG&A expenses were $821.2 million (20.0 percent of revenues), compared with $844.2 million (19.0 percent of revenues) in 2023.
Added
This decrease was due to (i) the accelerated amortization method whereby most of our acquired intangibles have higher amortization rates at the beginning of their useful lives, and (ii) older intangibles reaching the end of their useful lives.
Added
Interest Expense, Net Interest expense, net, which consists primarily of cash-based interest expense, amortization and adjustments to deferred loan costs, and interest income, was $64.3 million, down from $66.4 million in 2023.
Added
The decrease was primarily the result of higher interest income and lower debt amendment fees (related to refinancing the senior secured credit facility in both periods), partially offset by higher interest expense on the senior secured credit facility.
Added
Contract backlog coverage ratio is calculated as total Contract Backlog divided by TTM revenues.
Added
Net cash used in investing activities was $35.3 million and $40.5 million for 2024 and 2023 , respectively , and primarily related to capital expenditures. Net cash used in financing activities in 2024 was $333.2 million, and primarily consisted of $327.2 million to repurchase the Company's common stock and required principal payments of $5.0 million on the term loan B.
Added
We established a rabbi trust to fund the deferred compensation plan, which is primarily comprised of mutual funds measured at fair value using the net asset value practical expedient, and approximates the deferred compensation plan liability balances (see Note 11. Stock-Based Compensation and Other Employee Benefit Plans in Item 8. Financial Statements and Supplementary Data ).

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeFinancial Statements and Supplementary Data for a further description of our debt instruments. A hypothetical 100 basis-point change in interest rates on variable-rate debt would have resulted in interest expense fluctuating approximately $5.0 million based on $498.8 million of debt outstanding for any 12-month period. We have not entered into any market risk sensitive instruments for trading purposes. 19
Biggest changeFinancial Statements and Supplementary Data for a further description of our debt instruments. A hypothetical 100 basis-point change in interest rates on variable-rate debt would have resulted in interest expense fluctuating approximately $4.9 million based on $493.8 million of debt outstanding for a 12-month period. We have not entered into any market risk sensitive instruments for trading purposes. 18
Item 7A. Quantitative and Qualitative Disclosures about Market Risk We are exposed to certain market risks arising from transactions in the normal course of business, principally risks associated with interest rates. Our exposure to interest rate risk is associated with our debt instruments. See Note 9. Long-Term Debt in Item 8.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk We are exposed to certain market risks arising from transactions in the normal course of business, principally risks associated with interest rates. Our exposure to interest rate risk is associated with our debt instruments. See Note 8. Long-Term Debt in Item 8.

Other ASGN 10-K year-over-year comparisons