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What changed in Star Equity Holdings, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Star Equity Holdings, Inc.'s 2024 and 2025 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 2025 report.

+407 added−255 removedSource: 10-K (2026-03-20) vs 10-K (2025-03-14)

Top changes in Star Equity Holdings, Inc.'s 2025 10-K

407 paragraphs added · 255 removed · 142 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeThrough our website, we make available free of charge our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and other reports and amendments to these reports that we file with or furnish to the Securities and Exchange Commission (“SEC”) in a timely manner after we provide them. - 4 -
Biggest changeAvailable Information We file electronically with the SEC, our annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (“Exchange Act”).
Specifically, of the Company’s employees, approximately 890 are client-facing consultants who sell and deliver the Company’s RPO services to its existing client base. The Company’s consultant population has deep expertise in specific functional areas and industry sectors, and provides broad-based recruitment and solution services based on the needs of each client on a regional and global basis.
Specifically, of the Company’s Business Services employees, approximately 870 are client-facing consultants who sell and deliver talent solutions services to its existing client base. The Company’s consultant population has deep expertise in specific functional areas and industry sectors, and provides broad-based recruitment and solution services based on the needs of each client on a regional and global basis.
We continue to explore all strategic alternatives to maximize value for stockholders, including without limitation, improving the market position and profitability of our services in the marketplace, and enhancing our valuation. We may pursue our goals through organic growth, strategic initiatives, or other alternatives.
We continue to explore strategic alternatives to maximize value for the Company’s stockholders, including, without limitation, improving the market position and profitability of our services and enhancing our valuation. We may pursue these objectives through organic growth, strategic initiatives, or other alternatives.
As part of our client retention and renewal strategy, we continue to develop and foster long-term relationships, and have been successful in retaining and negotiating multi-year (three to five year) contracts with most of our key partners. Market Competition The markets for the Company’s services and products are highly competitive.
As part of our client retention and renewal strategy, we continue to develop and foster long-term relationships, and have been successful in retaining and negotiating multi-year (three to five year) contracts with most of our key partners.
Our employees are encouraged to participate in these learning modules and to complete a minimum of 30 minutes of learning each week. - 3 - Segment and Geographic Data Financial information concerning the Company’s reportable segments and geographic areas of operation is included in Note 17 of the Notes to Consolidated Financial Statements contained in Item 8 of this Annual Report on Form 10-K (this “Form 10-K”).
Segment and Geographic Data Financial information concerning the Company’s reportable segments and geographic areas of operation is included in Note 17 of the Notes to Consolidated Financial Statements contained in Item 8 of this Annual Report on Form 10-K (this “Form 10-K”).
The Company employs approximately 980 people worldwide, including approximately 100 employees in the United States (“U.S.”) and 880 employees internationally. Hudson is dedicated to acquiring, investing in, and retaining top talent. Hudson RPO’s global and regional employees have vast training and expertise across human capital solutions.
The Company employs approximately 1,200 people worldwide, of which approximately 950 employees are within its Business Services segment, including approximately 110 employees in the United States (“U.S.”) and 840 employees internationally. The Company is dedicated to acquiring, investing in, and retaining top talent. Business Services global and regional employees have vast training and expertise across human capital solutions.
One client accounted for 20% or greater of accounts receivable as of December 31, 2024 and 2023. Our business is dependent upon the continuation of these business relationships as well as new client development.
As of December 31, 2025 and 2024, one client represented approximately 14% and 24% of accounts receivable, respectively. Our business is dependent upon the continuation of these business relationships as well as new client development.
We have taken actions to enhance our employees’ experience working for the Company through the implementation of a continuous performance management framework in order to drive employees’ performance, development, and engagement.
We have access to over 200 hours of learning modules. All our employees play an important part in contributing to and shaping our culture. We have taken actions to enhance our employees’ experience working for the Company through the implementation of a continuous performance management framework in order to drive employees’ performance, development, and engagement.
For each of the years ended December 31, 2024 and 2023, over 85% of the Company’s revenue was generated by its top 25 clients. Three clients accounted for an aggregate of 46% of revenue in 2024, and two clients accounted for an aggregate of 50% of revenue in 2023.
For the years ended December 31, 2025 and 2024, approximately 73% and 85% of revenue, respectively, was generated by its top 25 clients. In 2025, one client accounted for 23% of revenue, while in 2024 three clients accounted for an aggregate of 46% of revenue.
Our employee assistance programs offer additional support and information to our staff and a range of additional training modules were rolled out focusing on topics such as mental health awareness, health and wellness in the workplace, and keeping remote teams connected. All our employees play an important part in contributing to and shaping our culture.
Our employee assistance programs offer additional support and information to our staff and a range of additional training modules were rolled out focusing on topics such as mental health awareness, health and wellness in the workplace, and keeping remote teams connected. - 4 - Employees have access to a range of training courses, including courses on anti-harassment, discrimination, and unconscious bias. eLearning is an integral part of the continuous development journey that we offer.
We will also continue to monitor capital markets for opportunities to repurchase shares and consider other actions designed to enhance stockholder value, as well as review information regarding potential acquisitions and provide information to third parties, from time to time. Human Capital Resources The Company’s success significantly depends upon its workforce.
In addition, we will continue to monitor capital markets for opportunities to repurchase shares and consider other actions designed to enhance stockholder value.
Available Information We maintain a website with the address www.hudsonrpo.com . We are not including the information contained on our website as part of, or incorporating it by reference into, this Form 10-K.
The contents of our website or any other website are not incorporated by reference into this Annual Report on Form 10-K.
Our well-being program, Thrive, provides the framework to support our employees’ physical, mental and financial health and well-being in addition to providing our line managers with the guidance needed to support their teams. Our regional well-being champions rolled out a variety of initiatives aimed at raising awareness and encouraging employees to look after their health and well-being.
We also utilize varying amounts of temporary workers as necessary to fulfill customer requirements. Our regional well-being programs are rolling out a variety of initiatives aimed at raising awareness and encouraging employees to look after their health and well-being.
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ITEM 1. BUSINESS General Hudson Global, Inc. (the “Company” or “Hudson,” “we,” “us,” and “our”) is a leading total talent solutions provider operating under the brand name Hudson RPO. We deliver innovative, customized recruitment outsourcing and total talent solutions to organizations worldwide. Through our consultative approach, we develop tailored talent solutions designed to meet our clients’ strategic growth initiatives.
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ITEM 1. BUSINESS General Star Equity Holdings, Inc. (“Star Equity,” “Star,” the “Company,” “we,” or “our,” formerly known as Hudson Global, Inc. (“Hudson”)) is a diversified multi-industry holding company operating through four reportable segments: Building Solutions, Business Services, Energy Services, and Investments.
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We are a Delaware corporation, and have operated as an independent publicly held company since April 1, 2003, when Monster Worldwide, Inc., formerly TMP Worldwide, Inc., spun off its eResourcing division. The Company delivers Recruitment Process Outsourcing (“RPO”) services, consisting of recruitment and contracting solutions tailored to the individual needs of primarily mid-to-large multinational companies.
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Our common stock and 10% Series A Cumulative Perpetual Preferred Stock are listed on the Nasdaq Global Market under the symbols “STRR” and “STRRP,” respectively. The Building Solutions segment operates in the construction industry.
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The Company’s RPO delivery teams utilize recruitment process methodologies and project management expertise to meet clients’ ongoing business needs. The Company’s RPO services include complete recruitment outsourcing, project-based outsourcing, contingent workforce solutions, and recruitment consulting for clients’ permanent staff hires.
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The Business Services segment, which consists of Hudson Talent Solutions, LLC (“HTS”), delivers customized recruitment and contracting solutions to mid-to-large multinational companies, including Recruitment Process Outsourcing (“RPO”), project-based RPO, contingent workforce solutions, recruitment consulting, outsourced professional contract staffing, and managed service provider (“MSP”) services. The Energy Services segment consists of Alliance Drilling Tools, Inc.
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Hudson’s RPO services leverage the Company’s consultants, supported by the Company’s specialists, in the delivery of its proprietary methods to identify, select, and engage the best-fit talent for critical client roles.
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(“ADT”), which manufactures and supplies specialized drilling tools and downhole equipment used in directional drilling for oil and gas well construction as well as other applications, including mining, geothermal, and water wells. The Investments segment holds and manages certain corporate-owned real estate assets and investments in a limited number of publicly traded and private companies.
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In addition, the Company provides RPO clients with a range of outsourced professional contract staffing services and managed service provider services offered sometimes on a standalone basis and sometimes as part of a blended total talent solution. These services draw upon a combination of specialized recruiting and project management competencies to deliver a wide range of solutions.
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Merger On August 22, 2025, Star completed its previously announced acquisition of Star Operating Companies, Inc.
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Hudson-employed professionals - either individually or as a team - are placed with client organizations for a defined period of time based on specific business needs of the client. 2024 was a transformative year for the Company, in terms of key offerings and geographic reach.
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("SOC" or "Star Operating Companies", formerly known as Star Equity Holdings, Inc.) pursuant to the Agreement and Plan of Merger, dated as of May 21, 2025 (the “Merger Agreement”), by and among Star, SOC and HSON Merger Sub, Inc., a wholly owned subsidiary of Star (“Merger Sub”).
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To capitalize on the business growth in the Middle East, the Company announced it had entered into strategic agreements with Executive Solutions and Striver, both of which are Dubai-based talent solutions companies. These agreements allowed the Company to expand its global footprint and client base in the Middle East market.
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Upon the terms and subject to the conditions of the Merger Agreement, on August 22, 2025, at the effective time (the “Effective Time”) of the closing of the transaction pursuant to the Merger Agreement (the “Merger”), Merger Sub merged with and into SOC, with SOC continuing as the surviving corporation of the Merger under the name “Star Operating Companies, Inc." as a wholly owned subsidiary of Star.
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The Company evaluated the agreements under ASC 805 “Business Combinations” and determined that the transactions did not qualify as either business combinations or asset purchases. Payments associated with these agreements were classified as compensation expense and were included in the “Salaries and related” caption on the Company’s Consolidated Statements of Operations.
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Capitalized terms used herein but not defined have the meanings set forth in the Merger Agreement.
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On October 31, 2023, Hudson completed its acquisition of Hudson Global Resources (Singapore) Pte. Ltd. (“Hudson Singapore”), a provider of recruitment services primarily to clients operating in Singapore. Hudson Singapore has a 30-year track record of senior placements and project recruitment work across Southeast Asia including Singapore, Malaysia, the Philippines, Vietnam, Thailand, and Indonesia.
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Pursuant to the terms of the Merger Agreement, at the Effective Time, (i) each share of common stock of SOC issued and outstanding immediately prior to the Effective Time (other than certain shares as set forth in the Merger Agreement) were automatically converted into the right to receive 0.23 shares of Star common stock and (ii) each share of preferred stock of SOC issued and outstanding immediately prior to the Effective Time (other than certain shares set forth in the Merger Agreement) were automatically converted into the right to receive one (1) share of Star 10% Series A Cumulative Perpetual preferred stock (“Preferred Stock”).
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On November 15, 2023, Hudson announced the appointment of Jacob “Jake” Zabkowicz as Global Chief Executive Officer for Hudson RPO. Mr. Zabkowicz leads the vision, strategy, and execution of Hudson RPO’s growth plan, while Jeff Eberwein, Chief Executive Officer of Hudson Global, Inc., continues to focus on capital allocation, acquisitions, corporate strategy, and maximizing shareholder value.
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As a result of the Merger, former SOC common stockholders received approximately 744,291 shares of Star common stock for their SOC common shares and former SOC preferred stock stockholders received approximately 2,690,637 shares of Star Preferred Stock.
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In February 2024, Hudson RPO announced an expansion of its service offerings to include executive search in North America, focusing on Life Sciences and Human Resources. This expansion, coupled with the Company’s existing RPO strategy, provides a comprehensive talent acquisition approach, enabling clients to develop streamlined and centralized hiring strategies within a flexible and scalable total talent solution.
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No fractional shares of Star common stock were issued in the Merger, and SOC stockholders became entitled to receive cash in lieu of fractional shares in accordance with the Merger Agreement.
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This service offering better positions the Company as a strategic partner, helping clients to implement successful business strategies. In October 2024, the Company made a focused investment in Latin America to help drive our support and growth within the region by hiring a seasoned leader to spearhead efforts there.
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In addition, pursuant to the terms of the Merger Agreement, at the Effective Time, each award of SOC restricted stock units (“RSUs”) outstanding immediately prior to the Effective Time was converted into Star RSUs issued under the Hudson Global, Inc. 2009 Incentive Stock and Awards Plan, as amended (the “Plan”), in accordance with the Merger Agreement.
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Further in 2024, the Company enhanced its growth trajectory in North America, making investments in both its talent and geographic presence. It hired professionals to lead efforts in several areas, including executive search, finance, and communications, and increased its investment in the Tampa, Florida talent hub.
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Amendment to Certificate of Incorporation On September 4, 2025, Star Equity filed a certificate of amendment (the “Amendment”) to the Company’s Amended and Restated Certificate of Incorporation, as Amended (the “Charter”), to change the name of the Company from Hudson Global, Inc. to Star Equity Holdings, Inc. (the “Name Change”).
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In addition, realizing that advancements in technology within the talent space have exponentially boomed over the past five years, the company increased investments in automation, AI, and optimization.
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The Name Change was approved by the Company’s Board of Directors (the “Board”) on September 2, 2025, and became effective at 12:01 a.m. (Eastern Time) on September 5, 2025. Strategy Star Equity Holdings, Inc. Star Equity Holdings, Inc. operates as a diversified holding company.
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The company’s current technology solution, TalentMax, covers all areas of the talent journey, including brand awareness, sourcing, engagement, and assessment, as well as candidate offers and onboarding. - 1 - The Talent Acquisition industry has recognized Hudson RPO’s progress with several recent awards, including the SEEK Sara award in 2021, 2023 and 2024, inclusion in HRO Today’s Baker’s Dozen (recognized for the last 16 consecutive years, and named as the No. 1 RPO provider in APAC in 2023 and 2024), the Everest PEAK Matrix (recognized in all categories as a Major Contender or Star Performer in 2024), and NelsonHall (named a Leader in NelsonHall’s Vendor Evaluation & Assessment Tool (NEAT) Matrix in 2024).
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Corporate management focuses on capital allocation, strategic oversight, mergers and acquisitions, capital markets activities, investor relations, and oversight of the Investments segment. Operating subsidiaries are responsible for day-to-day operations, organic growth initiatives, and operational performance. - 1 - The Company periodically evaluates strategic alternatives intended to enhance its market position, improve profitability, generate liquidity, and increase shareholder value.
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Business Segments The Company operates directly in sixteen countries with three reportable geographic business segments: Americas, Asia Pacific, and Europe, Middle East, and Africa ("EMEA").
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Such alternatives may include organic growth initiatives, selective acquisitions, divestitures, business combinations, equity offerings, debt financings, and corporate restructurings. The timing and structure of any such transactions depend on market conditions, available capital, valuation considerations, and other relevant factors. Operating Businesses The Company operates in markets that management believes offer opportunities for growth.
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For the year ended December 31, 2024, the amounts and percentages of the Company’s total revenue from the three reportable segments were as follows: Revenue $ in thousands Amount Percentage Americas $ 27,894 19.9 % Asia Pacific 86,704 61.9 % EMEA 25,458 18.2 % Total $ 140,056 100.0 % Service Offerings The Company’s core service offering is RPO, consisting of RPO and contracting services: RPO: The Company provides complete recruitment outsourcing, project-based outsourcing, and recruitment consulting for clients’ permanent staff hires.
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The principal elements of the Company’s growth strategy include the following: • Organic growth from our core businesses. The Company operates in markets and geographies that management believes provide opportunities for growth in its core businesses.
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Hudson’s RPO services leverage the Company’s consultants, supported by the Company’s specialists, in the delivery of its proprietary methods to identify, select, and engage the best-fit talent for critical client roles.
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The Company’s primary focus is on markets in which it currently maintains a presence, allowing it to leverage existing personnel, infrastructure, and brand recognition. • Expansion of service offerings. The Company evaluates opportunities to broaden its service offerings to better serve its customer base, including expansion into adjacent market segments and complementary services. • Acquisition of complementary businesses.
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Contracting: The Company provides clients with a range of outsourced professional contract staffing services and managed service provider services offered sometimes on a standalone basis and sometimes as part of a blended total talent solution. These services draw upon a combination of specialized recruiting and project management competencies to deliver a wide range of solutions.
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The Company intends to continue evaluating complementary businesses that meet its financial and strategic acquisition criteria. Potential targets may include small public and private companies that can be integrated into the Company’s existing platform, as well as larger, more transformative transactions, subject to assessments of value, risk, and expected return.
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Hudson-employed professionals - either individually or as a team - are placed with client organizations for a defined period of time based on specific business needs of the client.
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The timing and structure of any such transactions will depend on market conditions, availability of capital, valuation considerations, and other relevant factors. The Company does not intend to pursue transactions unless management determines that the anticipated post-transaction value creation is favorable to stockholders. Segments The Company operates four segments: Building Solutions, Business Services, Energy Services, and Investments.
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For the year ended December 31, 2024, the amounts and percentages of the Company’s total revenue from the core service offerings were as follows: Revenue $ in thousands Amount Percentage RPO $ 67,993 48.5 % Contracting 72,063 51.5 % Total $ 140,056 100.0 % - 2 - Clients The Company’s clientele includes mid-to-large-cap multinational companies and government agencies.
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Building Solutions includes KBS Builders, Inc. (“KBS”), EdgeBuilder, Inc. (“EdgeBuilder”), Glenbrook Building Supply, Inc. (“Glenbrook”) (together, “EBGL”), and Timber Technologies Solutions, Inc. (“TT”), which manufacture modular buildings, structural wall panels, engineered wood products, and glue-laminated timber for residential, commercial, and industrial markets.
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There are few barriers to entry, so new entrants occur frequently, resulting in considerable market fragmentation. Companies in this industry compete based on a number of parameters including degree and quality of candidate and position knowledge, industry expertise, global presence, scalability, service quality, and efficiency in completing assignments.
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The Business Services segment consists of Hudson Talent Solutions (“HTS”) and provides RPO, contingent workforce solutions, recruitment consulting, outsourced professional contract staffing, and MSP services across eighteen countries across three geographic regions: the Americas, Asia Pacific, and Europe, Middle East, and Africa.
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Typically, companies with greater strength or scale in these areas generate higher margins. Growth Strategy We focus on organically growing our RPO business, reducing overhead expenses as a percentage of revenue, and pursuing acquisition opportunities.
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The Energy Services segment consists of ADT, a Wyoming- and Texas-based provider of downhole drilling tools and services to the oil and gas, geothermal, mining, and waterwell sectors, with a cost structure that allows most variable costs to be passed through to customers.
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We target driving organic growth in RPO by investing in people and technology, as well as sales and marketing, to leverage our existing strong reputation in the market. We are investigating acquisition opportunities to expand capabilities and capacity and utilize our net operating losses.
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The Investments segment holds and manages certain corporate-owned real estate assets and investments in a limited number of publicly traded and private companies.
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Employees have access to a range of training courses, including courses on anti-harassment, discrimination, and unconscious bias. eLearning is an integral part of the continuous development journey that we offer to all our employees.
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Our reportable segments are based upon our internal organizational structure, the manner in which our operations are managed, the criteria used by our Chief Executive Officer (Chief Operating Decision Maker or "CODM") to evaluate segment performance, the availability of separate financial information, and overall materiality considerations. See Note 17. Segments, within the notes to our accompanying consolidated financial statements.
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Through our long-term partnership with one of the leading eLearning providers, our employees have access to an extensive range of hiring and talent management content delivered by industry experts and renowned thought leaders. Our eLearning courses include over 200 hours of learning modules, including over 20 modules specifically on diversity.
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From time to time, we also review potential acquisition or business combination opportunities and may provide information to third parties regarding potential dispositions of assets or business lines. - 2 - Clients The Company serves a diverse client base across multiple industries through its operating segments, including construction, energy, and global talent solutions, with customers that include mid-to-large multinational corporations, commercial contractors, energy companies, and government agencies.
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Tailored learning programs, in which diversity forms a cornerstone, have been created for all client-facing roles.
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Competition The markets for our Business Services, Energy Services, and Building Solutions segments are highly competitive and, in certain cases, characterized by limited barriers to entry and market fragmentation. Competition is based on factors such as industry expertise, product and service quality, geographic reach, operational scale, pricing, and the ability to efficiently execute and deliver projects.
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In our Energy Services segment, demand is closely tied to oil prices, as customer drilling activity and capital spending are influenced by prevailing market conditions. In our Building Solutions segment, activity levels are influenced by broader construction trends, interest rates, and access to project financing.
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Companies with greater scale, operational efficiencies, and differentiated capabilities may achieve competitive advantages and improved margins across these markets. Intellectual Property Intellectual property in our businesses primarily consists of trademarks held. Patents We do not hold any patents within our businesses. Raw Materials Building Solutions. KBS, EBGL and TT operate in the wood-based construction market.
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The primary raw materials used in their production processes include dimensional lumber, mainly spruce-pine-fir, and sheathing/sheet goods (OSB and plywood). The majority of underlying raw material for KBS, EBGL, and TT are sourced by wholesalers and mills in the United States, though from time to time limited quantities are also sourced from Canada.
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These businesses depend on the reliability of the lumber supply chain and are sensitive to varying degrees to wood-based commodity price fluctuations. Raw materials are not material to the operations of the Company’s other business segments. - 3 - Manufacturing Building Solutions. KBS began manufacturing single family homes in 2001 and commercial modular multi-family housing units in 2008.
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In subsequent years, KBS expanded its product offerings to include a variety of commercial-scale multi-family buildings including apartments, condominiums, townhouses, and dormitories. The structures are built inside our climate-controlled factories and are then transported to the site where they are set, assembled, and secured to the foundation.
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Electrical, plumbing, and HVAC systems are inspected and tested in the factory prior to transportation to the site to ensure the modules meet all local building codes and quality requirements. Modular construction has gained acceptance and is a preferred building method by many architects and general contractors.
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The advantages of modular construction include: modules are constructed in a climate-controlled environment; weather conditions usually do not interrupt or delay construction; the building is protected from weather, reducing the risk of mold or other materials damage due to materials absorbing moisture from rain or snow; reduced site work; improved safety and security; reduced vandalism and attrition; and a significant reduction in overall project time.
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Manufacturing is not material to the operations of the Company’s other business segments. EBGL consists of two separate companies (EdgeBuilder and Glenbrook) operating in tandem with a common management team. EdgeBuilder manufactures wall panels and permanent wood foundations in a climate-controlled factory, then transports the panels to the construction site via flat-bed trucks.
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The panels are typically unloaded by crane and erected, or assembled, on site by professional framing contractors. Panelized construction, especially in large-scale, multi-unit projects, is becoming increasingly popular due to the heightened demand for construction labor. Additionally, because the wall panels are constructed in a controlled indoor environment, waste, weather-related delays, and mistakes are minimized.
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This shaves weeks off large, multi-unit construction schedules. Glenbrook, as a retailer of professional building products, is not directly involved in manufacturing but does often sell and ship product in tandem with EdgeBuilder wall panel deliveries.
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As the International Building Code® continues to evolve, KBS and EBGL, along with our professional partners in the industry, meet code changes with innovative products and a dedicated staff to ensure adherent builds. TT started operations in 2003 and has been manufacturing glue-laminated (glulam) wood columns and beams for post frame builders since that time.
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Timber Technologies products include treated and untreated columns for sidewalls and end walls in post frame buildings, glue-laminated headers and beams, and architectural grade beams for high-end commercial structures. Human Capital Resources The Company’s success significantly depends upon its workforce.
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The Company has a total of 245 employees in its Building Services and Energy Services segments, of which 162 were employed in manufacturing, 17 in operational roles, 37 in general and administrative functions, and 29 in marketing and sales. All of our 245 employees are full-time employees. All positions are in the United States.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur certificate of incorporation and by-laws currently include provisions: • authorizing our Board of Directors to issue shares of our preferred stock in one or more series without further authorization of our stockholders; - 11 - • requiring that stockholders provide advance notice of any stockholder nomination of directors or any new business to be considered at any meeting of stockholders; and • providing that vacancies on our Board of Directors will be filled by the remaining directors then in office.
Biggest changeOur bylaws also require stockholders to provide advance notice of any stockholder nominations of directors or proposals for new business to be considered at stockholder meetings, and provide that vacancies on our Board of Directors may be filled by the remaining directors then in office, which may limit stockholders’ ability to influence the composition of the Board.
We face risks in collecting our accounts receivable. In virtually all of our businesses, we invoice customers after providing services, which creates accounts receivable. Delays or defaults in payments owed to us could have a significant adverse impact on our business, financial condition, and results of operations.
We face risks in collecting our accounts receivable. In virtually all of our businesses, we invoice customers after providing services and products, which creates accounts receivable. Delays or defaults in payments owed to us could have a significant adverse impact on our business, financial condition, and results of operations.
Our revenue can vary because our clients often run bid processes for RPO functions and can terminate their relationship with us at any time with limited or no penalty. Our RPO business is significantly affected by our clients’ hiring needs and their views of their future prospects.
Our Business Services revenue can vary because our clients often run bid processes for RPO functions and can terminate their relationship with us at any time with limited or no penalty. Our RPO business is significantly affected by our clients’ hiring needs and their views of their future prospects.
Clients may, on very short notice, terminate, reduce, or postpone their recruiting assignments with us and, therefore, affect demand for our services. This could have a material adverse effect on our business, financial condition, and results of operations.
Clients may, on very short notice, terminate, reduce, or postpone their recruiting assignments with us and, therefore, affect - 6 - demand for our services. This could have a material adverse effect on our business, financial condition, and results of operations.
Our consolidated U.S. dollar cash balance could be lower because a significant amount of cash is generated outside of the U.S. This risk could have a material adverse effect on our business, financial condition, and results of operations.
Our consolidated U.S. dollar cash balance could be lower because a significant amount of cash - 14 - is generated outside of the U.S. This risk could have a material adverse effect on our business, financial condition, and results of operations.
Additionally, severe weather can cause our employees or contractors to miss work and interrupt delivery of our service, potentially resulting in a loss of revenue.
Additionally, severe weather can cause our employees or contractors to miss work and interrupt delivery of our service and products, potentially resulting in a loss of revenue.
Factors that could cause a delay or default include, but are not limited to, global economic conditions, business failures, and turmoil in the financial and credit markets. In certain situations, we provide our services to clients under a contractual relationship with a third-party vendor manager, rather than directly to the client.
Factors that could cause a delay or default include, but are not limited to, global economic conditions, business failures, and turmoil in the financial and credit markets. In certain situations, we provide our services to clients under a contractual relationship with a third-party, rather than directly to the client.
If our clients invest heavily in obtaining or designing and implementing their own systems for recruitment using AI and ML, they may have reduced demand for our services. It is too early to determine the extent to which AI and ML may impact our business, but it is possible that these tools may negatively impact our business.
If our clients invest heavily in obtaining or designing and implementing their own systems for recruitment using AI and ML, they may have reduced demand for our services. It is too early to determine the extent to which AI and ML may impact our business, but it is possible that these tools may negatively impact our business. ITEM 1B.
Our future earnings could be reduced as a result of the imposition of licensing or tax requirements or new regulations that prohibit, or restrict certain types of employment services we offer in the U.S. and foreign countries. Our future earnings could be reduced if additional regulatory requirements are imposed in the countries in which we operate.
Our future earnings could be reduced as a result of the imposition of licensing or tax requirements or new regulations that prohibit, or restrict certain types of services we offer in the U.S. and foreign countries. - 15 - Our future earnings could be reduced if additional regulatory requirements are imposed in the countries in which we operate.
On January 21, 2025, President Trump issued an executive order titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity” mandating among other things that federal contractors cease any “affirmative action” in violation of civil rights law and calling on the Attorney General to produce and deliver a report containing “recommendations for enforcing Federal civil-rights laws and taking other appropriate measures to encourage the private sector to end illegal discrimination and preferences, including DEI.” As a result of these developments, companies must re-examine their DEI programs to ensure that do not run afoul of the law and risk enforcement action from the U.S.
President issued an executive order titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity” mandating among other things that federal contractors cease any “affirmative action” in violation of civil rights law and calling on the Attorney General to produce and deliver a report containing “recommendations for enforcing Federal civil-rights laws and taking other appropriate measures to encourage the private sector to end illegal discrimination and preferences, including DEI.” As a result of these developments, companies must re-examine their DEI programs to ensure that do not run afoul of the law and risk enforcement action from the U.S.
If any of our clients fail to adequately address these developments, as a provider of RPO services, we may be exposed to risks to our business and potential reputational harm to the extent that our clients face investigations and enforcement actions stemming from their DEI or ESG policies.
If any of our clients fail to adequately address these developments, as a provider of staffing services, we may be exposed to risks to our business and potential reputational harm to the extent that our clients face investigations and enforcement actions stemming from their DEI or ESG policies.
Employees, customers, or customers’ employees who are dissatisfied with our public statements, policies, practices, or solutions related to the development and use of AI and ML may express opinions that could introduce reputational or business harm, or legal liability. In addition, our RPO business may be disrupted by new emergent tools that threaten our established business practices.
Employees, customers, or customers’ employees who are dissatisfied with our public statements, policies, practices, or solutions related to the development and use of AI and ML may express opinions that could introduce reputational or business harm, or legal liability. In addition, our operating businesses may be disrupted by new emergent tools that threaten our established business practices.
Any future regulations that make it more difficult or expensive for us to continue to provide our services may have a material adverse effect on our business, financial condition and results of operations. Provisions in our organizational documents and Delaware law will make it more difficult for someone to acquire control of us.
Any future regulations that make it more difficult or expensive for us to continue to provide our services may have a material adverse effect on our business, financial condition and results of operations. Provisions in our organizational documents and Delaware law will make it more difficult for someone to remove current management and to acquire control of us.
We collect, store and transmit a large amount of confidential company information on hundreds of millions of businesses, including financial information and personal information, as well as certain consumer information and credit information.
We collect, store and transmit a large amount of confidential information on hundreds of millions of businesses, including financial information and personal - 18 - information, as well as certain consumer information and credit information.
If we fail to meet the criteria set by our clients for new opportunities or for the renewal of existing services that we provide, or if our competitors are able to offer comparable service levels at reduced cost, our business may suffer. Our markets are highly competitive. The markets for our services are highly competitive.
If we fail to meet the criteria set by our clients for new opportunities or for the renewal of existing services that we provide, or if our competitors are able to offer comparable service levels at reduced cost, our business may suffer.
Our revenues fluctuate quarter to quarter primarily due to the vacation periods during the first quarter in the Asia Pacific region and the third quarter in the Americas and EMEA regions. Demand for our services is typically lower during traditional vacation periods when clients and candidates are on vacation.
The revenues from our Business Services segment fluctuate quarter to quarter primarily due to the vacation periods during the first quarter in the Asia Pacific region and the third quarter in the Americas and EMEA regions. Demand for our services is typically lower during traditional vacation periods when clients and candidates are on vacation.
Any evaluation of our RPO business and our prospects must be considered in light of the risks and uncertainties stated above, as well as the following: • the ability to maintain our relationships with our existing clients; • the ability to attract new clients; and • the ability to maintain or generate the amount of cash required to operate the RPO business.
Any evaluation of our operating businesses and our prospects must be considered in light of the risks and uncertainties stated above, as well as the following: the ability to maintain our relationships with our existing clients; the ability to attract new clients; and the ability to maintain or generate the amount of cash required to operate the operating businesses.
In addition, our ability to execute our strategy requires that we retain and recruit personnel, management and advisors with experience in our RPO business. We must continually evaluate and upgrade our base of available qualified personnel to keep pace with changing client needs and emerging technologies.
In addition, our ability to execute our strategy requires that we retain and recruit personnel, management and advisors with experience in our businesses. - 11 - We must continually evaluate and upgrade our base of available qualified personnel to keep pace with changing client needs and emerging technologies.
The countries in which we operate may: • create additional regulations that prohibit or restrict the types of employment services that we currently provide; • impose new or additional benefit requirements; • require us to obtain additional licensing to provide recruitment services; • impose new or additional restrictions on movements between countries; • increase taxes, such as sales or value-added taxes, payable by the providers of recruitment services; • increase the number of various tax and compliance audits relating to a variety of regulations, including wage and hour laws, unemployment taxes, workers’ compensation, immigration, and income, value-added, and sales taxes; or • revise transfer pricing laws or successfully challenge our transfer prices, which may result in higher foreign taxes or tax liabilities or double taxation of our foreign operations.
The countries in which we operate may create additional regulations that prohibit or restrict the types of services that we currently provide; • impose new or additional benefit requirements; require us to obtain additional licensing to provide building solutions, business services, energy services, or investments; impose new or additional restrictions on movements between countries; • increase taxes, such as sales or value-added taxes, payable by our operating companies; • increase the number of various tax and compliance audits relating to a variety of regulations, including wage and hour laws, unemployment taxes, workers’ compensation, immigration, and income, value-added, and sales taxes; or • revise transfer pricing laws or successfully challenge our transfer prices, which may result in higher foreign taxes or tax liabilities or double taxation of our foreign operations.
Investments may not perform as expected because they are dependent on a variety of factors, including our ability to effectively integrate new personnel and operations, our ability to sell new services, and our ability to retain existing or gain new clients. We face risks related to our international operations.
Investments may not perform as expected because they are dependent on a variety of factors, including our ability to effectively integrate new personnel and operations, our ability to sell new services, and our ability to retain existing or gain new clients.
In addition, our payment of principal and interest on any future indebtedness would reduce our cash available for operations. In addition, a default, amendment, or waiver to our NAB Facility Agreement or a future agreement to avoid a default may result in higher rates of interest and could impact our ability to obtain additional borrowings.
In addition, our payment of principal and interest on any future indebtedness would reduce our cash available for operations. In addition, a default, amendment, or waiver in any of our debt facilities or lending arrangements or a future agreement to avoid a default may result in higher rates of interest and could impact our ability to obtain additional borrowings.
Following the decision of the U.S. Supreme Court in Students for Fair Admissions, Inc. v. President and Fellows of Harvard College, 600 U.S. 181 (2023) and the election of President Trump, companies have begun to pull back from ESG and DEI initiatives in response to a changing legal and political climate.
Following the decision of the U.S. Supreme Court in Students for Fair Admissions, Inc. v. President and Fellows of Harvard College, 600 U.S. 181 (2023) and the current administration, companies have begun to pull back from ESG and DEI initiatives in response to a changing legal and political climate. On January 21, 2025, the U.S.
We conduct direct operations in sixteen countries and face both translation and transaction risks related to foreign currency exchange. For the year ended December 31, 2024, approximately 81% of our revenue was earned outside of the U.S. Our financial results could be materially affected by a number of factors particular to international operations.
Our Business Services segment conducts direct operations in sixteen countries and face both translation and transaction risks related to foreign currency exchange. For the year ended December 31, 2025, approximately 80% of our Business Services segment revenue was earned outside of the U.S. Our financial results could be materially affected by a number of factors particular to international operations.
Our operations depend on our ability to protect our facilities, computer and telecommunication equipment, and software systems against damage or interruption from fire, power loss, cyber-attacks, sabotage, telecommunications interruption, weather conditions, natural disasters, and other similar events.
Our business depends on uninterrupted service to clients. Our operations depend on our ability to protect our facilities, inventory, materials, machinery, transportation, computer and telecommunication equipment, and software systems against damage or interruption from fire, power loss, cyber-attacks, sabotage, telecommunications interruption, weather conditions, natural disasters, and other similar events.
We may be exposed to employment-related claims, legal liability, and costs from clients, employees, and regulatory authorities that could adversely affect our business, financial condition, or results of operations, and our insurance coverage may not cover all of our potential liability. We are in the business of employing people and placing them in the workplaces of other businesses.
We may be exposed to employment-related claims, legal liability, and costs from clients, employees, and regulatory authorities that could adversely affect our business, financial condition, or results of operations, and our insurance coverage may not cover all of our potential liability.
We operate in an environment of significant risk of cybersecurity incidents resulting from unintentional events or deliberate attacks by third parties or insiders, which may involve exploiting highly obscure security vulnerabilities or sophisticated attack methods.
We operate in an environment of significant risk of cybersecurity incidents, whether from unintentional events or deliberate attacks by third parties or insiders, which may exploit sophisticated methods or obscure vulnerabilities.
Data security and integrity are critically important to the businesses we own and manage, and cybersecurity incidents, including cyberattacks, breaches of security, unauthorized access to or disclosure of confidential information, business disruption, or the perception that confidential information is not secure, could result in a material loss of business, regulatory enforcement, substantial legal liability and/or significant harm to our reputation, which could have a material adverse effect on our business, financial condition and results of operations.
Data security and integrity are important to our businesses, and cybersecurity incidents, including but not limited to breaches, unauthorized access, or disclosure of confidential information, could result in a material loss of business, regulatory enforcement, substantial legal liability, and significant harm to our reputation, any of which could have a material adverse effect on our business, financial condition and results of operations.
Due to competition, we may experience reduced margins on our services, loss of market share and loss of customers. If we are not able to compete effectively with current or future competitors as a result of these and other factors, our business, financial condition, and results of operations could be materially adversely affected.
If we are not able to compete effectively with current or future competitors as a result of these and other factors, our business, financial condition, and results of operations could be materially adversely affected.
Our certificate of incorporation and by-laws and the Delaware General Corporation Law contain several provisions that make it more difficult to acquire control of us in a transaction not approved by our Board of Directors, including transactions in which stockholders might otherwise receive a premium for their shares over then current prices, and that may limit the ability of stockholders to approve transactions that they may deem to be in their best interests.
Our certificate of incorporation and bylaws contain provisions that may make it more difficult for a third party to acquire control of us in a transaction not approved by our Board of Directors, including transactions in which stockholders might otherwise receive a premium for their shares over then-current market prices.
We may incur fines and other losses or negative publicity with respect to these problems. In addition, some or all of these claims may give rise to litigation, which could be time-consuming to our management team, costly, and could have a negative effect on our business.
In addition, some or all of these claims may give rise to litigation, which could be time-consuming to our management team, costly, and could have a negative effect on our business. In some cases, we have agreed to indemnify our clients against some or all of these types of liabilities.
We cannot assure that we will not experience these problems in the future, that our insurance will cover all claims, or that our insurance coverage will continue to be available at economically feasible rates. - 10 - Our ability to utilize net operating loss carryforwards may be limited. The Company has U.S. net operating loss carryforwards (“NOLs”).
We cannot assure that we will not experience these problems in the future, that our insurance will cover all claims, or that our insurance coverage will continue to be available at economically feasible rates.
If we are forced to discontinue any of our international operations, we could incur material costs to close down such operations.
If we are forced, or determine, to discontinue or restructure any of our international operations, we could incur material costs to close down such operations, which could adversely affect our results of operations and financial condition.
Issues relating to the use of new and evolving technologies, such as Artificial Intelligence (“AI”) and Machine Learning (“ML”) present challenges for our business and may result in liability.
Failure to effectively manage system vulnerabilities or maintain and upgrade safeguards may lead to unexpected costs or increased susceptibility to unauthorized access. Issues relating to the use of new and evolving technologies, such as Artificial Intelligence (“AI”) and Machine Learning (“ML”) present challenges for our business and may result in liability.
While we have implemented measures to prevent security breaches and cyber incidents, our measures may not be effective, and any security breaches or cyber incidents could adversely affect our business, financial condition, and results of operations. - 9 - Our business depends on uninterrupted service to clients.
We also use mobile devices, social networking, and other online activities to connect with our candidates, clients, and business partners. While we have implemented measures to prevent security breaches and cyber incidents, our measures may not be effective, and any security breaches or cyber incidents could adversely affect our business, financial condition, and results of operations.
Any of these events could have a material adverse effect on our business, financial condition, and results of operations. We have had periods of negative cash flows and operating losses that may recur in the future. We have experienced negative cash flows and reported operating and net losses in previous years.
We have had periods of negative cash flows and operating losses that may recur in the future. We have experienced negative cash flows and reported operating and net losses in previous years.
Our markets are characterized by pressures to provide high levels of service, incorporate new capabilities and technologies, accelerate job completion schedules, and reduce prices. Furthermore, we face competition from a number of sources. These sources include other executive search firms and professional search, staffing, and consulting firms. Several of our competitors have greater financial and marketing resources than we do.
The markets for our services are highly competitive. Our markets are characterized by pressures to provide high levels of service, incorporate new capabilities and technologies, accelerate job completion schedules, and reduce prices. Furthermore, we face competition from a number of sources.
This may require the acquisition of equipment and software and the development, either internally or through independent consultants, of new proprietary software.
To achieve our strategic objectives and to remain competitive, we must continue to develop and enhance our information systems. This may require the acquisition of equipment and software and the development, either internally or through independent consultants, of new proprietary software.
The Company also could be adversely affected if key personnel or a significant number of employees were to become unavailable due to health concerns.
The Company also could be adversely affected if key personnel or a significant number of employees were to become unavailable due to health concerns. Although the Company has business continuity plans and other safeguards in place, there is no assurance that such plans and safeguards will be effective.
In addition, we believe that, with continuing development of information technology, the industries in which we compete may attract new competitors. Specifically, the increased use of web-based and mobile technology may attract technology-oriented companies to the recruitment industry. We cannot provide assurance that we will be able to continue to compete effectively against existing or future competitors.
Specifically, the increased use of web-based and mobile technology may attract technology-oriented companies to the recruitment industry. We cannot provide assurance that we will be able to continue to compete effectively against existing or future competitors. Any of these events could have a material adverse effect on our business, financial condition, and results of operations.
In those circumstances, the third-party vendor manager is typically responsible for aggregating billing information, collecting receivables from the client, and paying staffing suppliers once funds are received from the client.
In those circumstances, the third-party is typically responsible for aggregating billing information, collecting receivables from the client, and paying suppliers or subcontractors once funds are received from the client. In the event that the client has paid the third-party for our services and products and we are unable to collect from the third-party, we may be exposed to financial losses.
Our success depends in large part upon our ability to store, retrieve, process, and manage substantial amounts of information, including our client and candidate databases. To achieve our strategic objectives and to remain competitive, we must continue to develop and enhance our information systems.
We rely on our information systems, and if we lose our information processing capabilities or fail to further develop our technology, our business could be adversely affected. Our success depends in large part upon our ability to store, retrieve, process, and manage substantial amounts of information, including our client and candidate databases.
If any of the following risks occur, our business, financial condition, results of operations, and cash flows could be materially adversely affected. Our operations will be affected by global economic fluctuations. Clients’ demand for our services may fluctuate widely with changes in economic conditions in the markets in which we operate.
If any of the following risks occur, our business, financial condition, results of operations, and cash flows could be materially adversely affected.
The loss of these customers or any material reduction in the amount of business we conduct with these customers, or any material adverse change in the financial condition of such customers, could materially and adversely affect our financial condition and results of operations.
The loss of any significant customer, a material reduction in business from such customers, or a deterioration in the financial condition of these customers could materially adversely affect our revenues, financial condition, and results of operations. Our customer relationships generally do not provide long‑term volume commitments.
Although the Company has business continuity plans and other safeguards in place, there is no assurance that such plans and safeguards will be effective. - 8 - Failure to attract and retain qualified personnel, management and advisors could negatively impact our business, financial condition, and results of operations.
Failure to attract and retain qualified personnel, management and advisors could negatively impact our business, financial condition, and results of operations.
In addition, Section 203 of the Delaware General Corporation Law generally provides that a corporation may not engage in any business combination with any interested stockholder during the three-year period following the time that the stockholder becomes an interested stockholder, unless a majority of the directors then in office approve either the business combination or the transaction that results in the stockholder becoming an interested stockholder or specified stockholder approval requirements are met.
In addition, as a Delaware corporation, we are subject to Section 203 of the Delaware General Corporation Law, which generally prohibits a Delaware corporation from engaging in a business combination with an “interested stockholder” for a period of three years following the time that such stockholder becomes an interested stockholder, unless the transaction or the acquisition of stock that resulted in the stockholder becoming an interested stockholder is approved by the board of directors or specified stockholder approval requirements are satisfied.
We have no significant proprietary technology that would preclude or inhibit competitors from entering the - 6 - recruitment outsourcing market. We cannot provide assurance that existing or future competitors will not develop or offer services that provide significant performance, price, creative, or other advantages over our services.
We cannot provide assurance that existing or future competitors will not develop or offer services that provide significant performance, price, creative, or other advantages over our services. In addition, we believe that, with continuing development of information technology, the industries in which we compete may attract new competitors.
Our ability to reduce costs in line with our revenues is important for the improvement of our profitability. Efforts to improve our efficiency could be affected by several factors including turnover, client demands, market conditions, continued increases in inflation, changes in laws, and availability of talent.
Efforts to improve our efficiency could be affected by several factors including turnover, client demands, market conditions, continued increases in inflation, changes in laws, and availability of talent. If we fail to realize the expected benefits of these cost reduction initiatives, this could have an adverse effect on our financial condition and results of operations.
Those conditions include slower employment growth or reductions in employment, which directly impact our service offerings. Geopolitical events such as the war in Ukraine, conflicts in the Middle East and the U.S./China trade tensions, have caused significant economic, market, political, and regulatory uncertainty in some of the Company’s markets.
Geopolitical events, including political divisions, the war in Ukraine, the war in Iran, other conflicts in the Middle East, U.S./China trade tensions, and the use or threatened use of tariffs, have contributed to economic, market, political, and regulatory uncertainty in certain of our markets.
If we are unable to address these risks, our business, results of operations, and prospects could suffer. Our revenues fluctuate from quarter to quarter; no single quarter is predictive of future periods ’ results.
If we are unable to address these risks, our business, results of operations, and prospects could suffer. We may make financial investments in other businesses that may lose value.
In the event that the client has paid the vendor manager for our services and we are unable to collect from the vendor manager, we may be exposed to financial losses. If we are unable to maintain costs at an acceptable level, our operations could be adversely impacted.
If we are unable to maintain costs at an acceptable level, our operations could be adversely impacted. - 9 - Our ability to reduce costs in line with our revenues is important for the improvement of our profitability.
We also may not realize all of the anticipated benefits of acquisitions, or potential future strategic transactions, which could adversely affect our business, financial condition and results of operations. Our ability to achieve certain benefits from acquisitions of businesses will depend in large part upon our ability to successfully integrate such businesses in an efficient and effective manner.
Our growth strategy includes acquisitions and dispositions, but we may not realize the anticipated benefits of these transactions, which could adversely affect our business, financial condition, and results of operations. - 7 - As part of our growth strategy, we may pursue acquisitions of businesses that we believe can complement or expand our current operations, and we may also sell businesses from time to time.
If we are unable to replace such revenue from existing or new customers, it could have a material adverse effect on our business, financial condition, and results of operations, and the market price of our common stock could decline significantly.
If we are unable to replace lost or reduced business from existing customers, successfully compete for renewals and new engagements, or maintain effective distribution relationships, our revenues, cash flows, and results of operations could be materially adversely affected, and the market price of our common stock could decline. Our markets are highly competitive.
If they are unable to efficiently manage the vulnerability of their systems and effectively maintain and upgrade their system safeguards, they may incur unexpected costs and certain of their systems may become more vulnerable to unauthorized access. - 12 - Changing rules, public disclosure regulations and stakeholder expectations on environmental, social and corporate governance (“ESG”) related matters and diversity, equity and inclusion (“DEI”) related matters expose us to potential liabilities, increased costs, reputational harm and other adverse effects on our business.
Because we are not required to, and have not, had our auditor provide an attestation of our management’s assessment of internal control over financial reporting, a material weakness in internal controls may remain undetected for a longer period. - 17 - Changing rules, public disclosure regulations and stakeholder expectations on environmental, social and corporate governance (“ESG”) related matters and diversity, equity and inclusion (“DEI”) related matters expose us to potential liabilities, increased costs, reputational harm and other adverse effects on our business.
The strategic transaction process may disrupt our business including diverting management’s attention from ongoing business concerns. - 5 - Our profitability and growth depend on the success of our global RPO business, which is subject to a variety of business risks and uncertainties. We are focused on our global RPO business.
Our profitability and growth may depend on the success of our operating businesses which include Buildings Solutions and construction related products, global Business Services, and drilling products and other Energy Services, which businesses are subject to a variety of business risks and uncertainties.
These factors may impact labor markets and the demand for workforce, available borrowing capacity, cash flow protection, and more. As a result, our business, financial condition, and results of operations may be negatively affected. We may not be able to successfully execute our strategic initiatives or meet our long-term financial goals.
We may not be able to successfully execute our strategic initiatives or meet our long-term financial goals.
Our business is highly dependent upon our largest customers, and the loss of any of those customers, or any material reduction in our business with those customers, could materially and adversely affect our financial condition and results of operations.
We cannot predict the timing, duration, or severity of adverse economic conditions, and any sustained deterioration in global economic conditions or labor markets could materially adversely affect our business, financial condition, results of operations, and cash flows.
Finally, debt incurred under the NAB Facility Agreement bears interest at the variable receivable finance indicator rate, plus a margin of 1.60% per annum. Any increase in interest expense could reduce the funds available for operations. - 7 - Our investment strategy subjects us to risks. From time to time, we make investments as part of our growth plans.
Finally, debt incurred under some of our debt facilitates have a variable rate, which may fluctuate upward. Any increase in interest expense could reduce the funds available for operations.
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In addition, the use or threatened use of tariffs by the Trump administration may cause disruptions in global trade, which could negatively impact clients that we serve and reduce demand for our services. We have limited flexibility to combat these uncertainties and reduce expenses during economic downturns due to some overhead costs that are fixed in the short-term.
Added
Risks Related to Our Business and Industry Our business is sensitive to global economic conditions and fluctuations, including inflation, interest rates, and geopolitical uncertainty, which may reduce demand for our services and adversely affect our costs, profitability, and liquidity. Our operations and results of operations are affected by global economic conditions in the markets in which we operate.
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As a result, we may face increased pricing pressures during these periods. Our clients’ demands for RPO and contracting services largely depend on the market conditions and the strength of the labor markets in the countries where we operate.
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Clients’ demand for our Building Solutions, Business Services, and Energy Services may fluctuate widely in response to changes in economic conditions, including slower employment growth, reductions in hiring, reduced labor demand, reduced demand for construction products and materials, reduced demand for oil producing equipment, and overall economic uncertainty.
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In the second half of 2024, the market conditions were more challenging than anticipated due to persistent inflation and elevated interest rates, and decreased demand for labor in certain markets. In addition, in connection with the challenging business environment, some of our customers have reduced demand, and certain other customers have eliminated our services on a temporary or permanent basis.
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In particular, demand for our RPO and contracting services is closely tied to labor market conditions and workforce expansion by our clients. Periods of slower employment growth, hiring freezes, or workforce reductions may directly reduce demand for these services.
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While we believe that market conditions will continue to be challenging in 2025, we cannot predict market conditions with any certainty. The pricing pressures and global economic fluctuations are not limited to the periods of geopolitical events.
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Global concerns such as pandemics, wars, or other sources of instability may - 5 - also result in social, economic, and labor disruption, negatively impacting customer demand, supply chains, labor markets, and financial markets. In recent periods, global economic conditions have included elevated inflation, rising or sustained high interest rates, currency volatility, and increased economic uncertainty.
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Higher than expected inflation in most markets and elevated interest rates, have led to significant market disruption, including further wage inflation, increased operating costs, staffing challenges, reduced consumer confidence, and limited capital market accessibility that impact our business. The inflationary environment and related interest rate impacts continue to have a significant adverse impact on the economy and market conditions.
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Inflationary pressures have increased our costs for labor, raw materials, transportation, and other inputs, and have also contributed to wage inflation and increased operating costs across our business. In an inflationary environment, we may be unable to increase prices at a rate sufficient to offset these higher costs, which could adversely affect our margins, profitability, and cash flows.
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We may face risks related to potential or current acquisitions or dispositions of businesses. As part of our growth strategy, we may pursue acquisition opportunities that we believe can complement or expand our current business activities or sell other businesses. Acquisition and disposition activity exposes us to a number of risks.
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Higher interest rates may also increase our borrowing costs, reduce client spending, and limit access to capital markets, which could further reduce demand for our products and services. Because certain of our operating costs are fixed or semi-fixed in the short term, adverse economic conditions may have a disproportionate impact on our financial condition and results of operations.
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There could be unforeseen liabilities or asset impairments that arise in connection with the businesses that we may sell or the businesses that we may acquire in the future.
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Our operating results may be adversely affected by changes in the cost and availability of commodities, materials, and equipment, including as a result of trade tariffs, supply‑chain disruptions, and market conditions, which could increase costs and reduce demand for our products and services.
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With respect to businesses that we may sell, we would also no longer be able to rely on any cash flow they generated, and there is no assurance that when or if we reinvested any proceeds from a sale it would be in an acquisition that generates the anticipated benefits.
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Our operating results, particularly within our Building Solutions and Energy Services segments, depend on the cost and availability of raw materials, commodities, and equipment used in the manufacture, sale, or leasing of our products.
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We may not be able to integrate any such businesses smoothly or successfully, and the process may take longer than expected. We can provide no assurances that we will enter into any agreements in connection with potential acquisitions or dispositions or as to the timing of any potential strategic transactions.
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Many of the commodities and materials we use are imported or exported, and their prices and availability may fluctuate significantly due to changes in global supply and demand, transportation costs, energy prices, and conditions in the financial and housing markets.
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For each of the years ended December 31, 2024 and 2023, over 85% of the Company’s revenue was generated by its top 25 clients. Three clients accounted for an aggregate of 46% of revenue in 2024, and two clients accounted for an aggregate of 50% of revenue in 2023.
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Trade policies, including the use or threatened use of tariffs, import duties, quotas, or other trade restrictions, may disrupt global trade and supply chains. To the extent the commodities and materials we use become subject to tariffs or similar measures, our procurement costs could increase and market availability could be constrained.
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One client accounted for 20% or greater of accounts receivable as of December 31, 2024 and 2023. Our business is dependent upon the continuation of these business relationships as well as new client development.
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We may be unable to recover such increased costs from customers without adversely affecting demand, which could materially adversely affect our margins, results of operations, financial condition, and cash flows. In addition, disruptions in global trade may negatively impact our customers, which could reduce demand for our products and services.
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Our credit facilities may restrict our operating flexibility in the future. The Company’s Australian subsidiary (“Australian Borrower”) entered into an invoice finance credit facility agreement (the “NAB Facility Agreement”) with National Australia Bank Limited (“NAB”).

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAnd events, when detected by security tools or third parties, may not always be immediately understood or acted upon. Additionally, cybersecurity risks and threats that could have a material impact on the Company are discussed further in the Item 1A Risk Factors. Those sections of Item 1A should be read in conjunction with this Item 1C. Gove rnance.
Biggest changeAdditionally, cybersecurity risks and threats that could have a material impact on the Company are discussed further in the Item 1A Risk Factors. Those sections of Item 1A should be read in conjunction with this Item 1C.
Results of audits and material security incidents are presented to the Board of Directors on a quarterly basis.
Results of audits and material security incidents are presented to the Board of Directors on a quarterly basis. - 20 -
The Global Director of Information Technology (GDIT) is the management position with primary responsibility for the development, operation, and maintenance of our information security program. The GDIT has over 25 years of experience as a security professional, and has completed the Prince 2 risk management certification at the practitioner level.
The Global Director of Information Technology (GDIT) is the management position with primary responsibility for the development, operation, and maintenance of our information security program for the Business Services segment. The GDIT has over 25 years of experience as a security professional, and has completed the Prince 2 risk management certification at the practitioner level.
Responsibilities of this role include management of third-party vendors, ensuring data interactions with outside parties, adhering to IT security best practices, and ensuring that all devices within the Company's IT infrastructure are appropriately secured and managed.
Responsibilities of this role include management of third-party vendors, ensuring data interactions with outside parties, adhering to IT security best practices, and ensuring that all devices within the Business Services segment IT infrastructure are appropriately secured and managed.
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ITEM 1C. CYBERSECURITY Risk Management and Strategy. The Company has established an information security program to address and mitigate material risks from cybersecurity threats. The program includes policies and procedures that identify how security measures and controls are developed, implemented, and maintained. These policies and procedures undergo an annual audit to ensure compliance with ISO 27001 controls.
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ITEM 1C. CYBERSECURITY Risk Management and Strategy We identify and address cybersecurity threats and risks related to our business using an interdisciplinary approach that includes assessments primarily by our management, IT team and legal department.
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A risk assessment, based on a method and guidance from a recognized national standards organization, is conducted annually. The risk assessment along with risk-based analysis and judgment are used to select security controls to address risks.
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To defend against, detect and respond to - 19 - cybersecurity incidents, we employ a multi-layered approach that has been integrated into our overall risk management systems and processes which includes, among other things: conducting proactive privacy and cybersecurity reviews of systems and applications, auditing applicable data policies, conducting employee training, monitoring emerging laws and regulations related to data protection and information security and continuously improving controls and implementing appropriate changes.
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Third-party security firms are used in different capacities to provide or operate some of these controls and technology systems, including cloud-based platforms and services. For example, third parties are used to conduct assessments, such as vulnerability scans and penetration testing.
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The cybersecurity-control principles that form the basis of our cybersecurity program are informed by the National Institute of Standards and Technology Cybersecurity Framework. Our management performs an annual review of third-party service providers’ SOC reports to verify appropriate controls are in place. Our Business Services segment undergoes an annual audit to ensure compliance with ISO 27001 controls.
Removed
The Company uses a variety of processes to address cybersecurity threats related to the use of third-party technology and services, including pre-acquisition diligence, imposition of contractual obligations, and performance monitoring. The Company has a written incident response plan and conducts tabletop exercises to enhance incident response preparedness.
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In 2025, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. In addition, security controls, no matter how well designed or implemented, may only mitigate and not fully eliminate risks.
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Business continuity and disaster recovery plans are used to prepare for the potential for a disruption in technology we rely on. The Company is a member of an industry cybersecurity intelligence and risk sharing organization.
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And events, when detected by security tools or third parties, may not always be immediately understood or acted upon. Despite our ongoing efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced undetected cybersecurity incidents.
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Employees undergo security awareness training when hired and annually. - 13 - The Company has a Governance, Risk, and Compliance (GRC) function to address enterprise risks, and cybersecurity is a risk category addressed by that function. The Company (or third parties it relies on) may not be able to fully, continuously, and effectively implement security controls as intended.
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Cybersecurity Governance Cybersecurity is an important part of our risk management processes and is an area of focus for our board of directors and management. Our board of directors, as a whole, has oversight responsibility for our strategic and operational risks, and ensures that appropriate risk mitigation strategies are implemented by management.
Removed
As described above, we utilize a risk-based approach and judgment to determine the security controls to implement and it is possible we may not implement appropriate controls if we do not recognize or underestimate a particular risk. In addition, security controls, no matter how well designed or implemented, may only mitigate and not fully eliminate risks.
Added
Our audit committee assists the board of directors with this responsibility by periodically reviewing and discussing our risk assessment and risk management practices, including cybersecurity risks, with members of our management team, which is responsible for the assessment and management of cybersecurity risks.
Removed
It also encompasses ensuring that all employees are educated in IT best practices around incident management and security, ensuring the security of the internal and external IT systems, as well communicating to senior management and planning for future IT strategy and security. The Company has an established Information Security Committee to manage the information security risk assessment framework.
Added
In addition, we have retained an external consultant to serve as our internal audit function and to support our cybersecurity risk management and governance practices. Our consultant has substantial experience in cybersecurity risk management and information technology, including security, compliance, systems and programming and reports to our audit committee and our board of directors on any appropriate items.
Removed
This framework includes a defined methodology and tolerable level of risk documented within the Information Security Management System ("ISMS") and relevant controls addressing business risks. The committee is informed of all security incidents and ensures appropriate remediation activities are implemented. The Company’s ISMS are audited by both internal and external parties on a regular basis.
Added
Responsibilities also encompass communication to senior management and future IT strategy and security planning for all segments, which may include outsourcing of certain responsibilities. The Company’s compliance committee and counsel are informed of all security incidents and are tasked with ensuring appropriate remediation activities are implemented.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAll leased space is considered to be adequate for the operation of our business, and no difficulties are foreseen in meeting any future space requirements.
Biggest changeWithin the Energy Services segment, ADT owns a 21,400 square foot property in Evanston, Wyoming, a 6,950 square foot property in Vernal, Utah, and a 5,000 square foot property in Midland, Texas. All leased space is considered to be adequate for the operation of our business, and no difficulties are foreseen in meeting any future space requirements. See Note 11.
ITEM 2. PROPERTIES All of the Company’s operating offices are located in leased premises. Our principal executive office and headquarters are located at 53 Forest Avenue, Suite 102, Old Greenwich, CT 06870, where we occupy space with approximately 2,000 aggregate square feet. The Company maintains offices in the Americas, Asia Pacific, and EMEA.
ITEM 2. PROPERTIES All of the Company’s offices are located in leased premises, with the exception of the properties owned by ADT. Our principal executive office and headquarters is located at 53 Forest Avenue, Suite 101, Old Greenwich, CT 06870, where we occupy space with approximately 4,000 aggregate square feet.
In the Americas, the Company maintains 1 leased location with approximately 2,600 aggregate square feet; in Asia Pacific, the Company maintains 6 leased locations with approximately 30,700 aggregate square feet; and in EMEA, the Company maintains 1 leased location with approximately 1,200 aggregate square feet.
In the Americas, the Company maintains 1 leased location with approximately 2,600 aggregate square feet; in Asia Pacific, the Company maintains 5 leased locations with approximately 18,900 aggregate square feet; and in EMEA, the Company maintains 1 leased location with approximately 3,600 aggregate square feet.
Added
Our Building Solutions businesses utilizes 6 facilities, including (i) an 85,000 square foot office/manufacturing/warehouse space in South Paris, Maine, which the Company sold and immediately leased back in 2024; (ii) a 89,000 square foot manufacturing facility in Colfax, Wisconsin; (iii) a 10,800 square foot office/sales/showroom space in Oakdale, Minnesota; (iv) a 34,200 square foot production facility in Prescott, Wisconsin, which the Company sold and immediately leased back in 2024; (v) a facility containing 22,800 square feet of lumberyard/warehouse space in Hudson, Wisconsin; and (vi) a 22,300 square foot lumberyard/warehouse/showroom space in Big Lake, Minnesota.
Added
The latter property was sold and immediately leased back in July 2024. We also hold a non-operating building in Oxford, Maine with 90,000 square feet. In our Business Services segment, the Company maintains offices in the Americas, Asia Pacific, and EMEA.
Added
Leases and Note 23. Subsequent Events for further detail on our leases.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeOn August 8, 2023, the Company’s Board of Directors authorized a new stock repurchase program for up to $5 million of the Company’s outstanding shares of common stock. This authorization does not expire.
Biggest changeThis authorization does not expire. - 22 - During the year ended December 31, 2025, the Company completed its $5 million share repurchase program authorized on August 8, 2023. On September 10, 2025, the Board of Directors authorized a new common stock repurchase program under which the Company may repurchase up to $3 million of its outstanding Common Stock.
The Company also repurchased 69,567 shares during the second quarter in connection with transactions with certain shareholders totaling $1.2 million, as well as 40,267 shares of its common stock on the open market for a cost of $0.7 million.
The Company also repurchased 69,567 shares during the second quarter in connection with transactions with certain shareholders totaling $1.2 million, as well as 40,267 shares of its common stock on the open market for a cost of $0.7 million. ITEM 6. RESERVED
Market Price High Low 2024 Fourth quarter $ 16.28 $ 11.73 Third quarter $ 19.70 $ 14.71 Second quarter $ 18.38 $ 14.76 First quarter $ 18.52 $ 13.38 2023 Fourth quarter $ 20.25 $ 14.66 Third quarter $ 24.00 $ 18.74 Second quarter $ 24.03 $ 17.88 First quarter $ 27.10 $ 20.70 DIVIDENDS In the last few years, the Company has not paid dividends, and there are no current plans to declare common stock dividends.
Market Price High Low 2025 Fourth quarter $ 11.99 $ 9.31 Third quarter $ 11.99 $ 8.26 Second quarter $ 10.74 $ 8.28 First quarter $ 13.65 $ 10.01 2024 Fourth quarter $ 16.28 $ 11.73 Third quarter $ 19.70 $ 14.71 Second quarter $ 18.38 $ 14.76 First quarter $ 18.52 $ 13.38 DIVIDENDS In the last few years, the Company has not paid dividends, and there are no current plans to declare common stock dividends.
ISSUER PURCHASES OF EQUITY SECURITIES The Company’s purchases of its common stock during the fourth quarter of fiscal 2024 were as follows: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (a) October 1, 2024 - October 31, 2024 — $ — — $ 2,118,651 November 1, 2024 - November 30, 2024 — $ — — $ 2,118,651 December 1, 2024 - December 31, 2024 — $ — — $ 2,118,651 Total — $ — — $ 2,118,651 (a) On July 30, 2015, the Company announced that its Board of Directors authorized the repurchase of up to $10 million of the Company’s common stock which was completed.
ISSUER PURCHASES OF EQUITY SECURITIES The Company’s purchases of its common stock during the fourth quarter of fiscal 2025 were as follows: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (a) October 1, 2025 - October 31, 2025 — $ — — $ 2,546,662 November 1, 2025 - November 30, 2025 — $ — — $ 2,546,662 December 1, 2025 - December 31, 2025 5,964 $ 11.03 5,964 $ 2,480,801 Total 5,964 $ 11.03 5,964 $ 2,480,801 (a) On August 8, 2023, the Company’s Board of Directors authorized a share repurchase program for up to $5 million of the Company’s outstanding common stock.
As of December 31, 2024, under the July 30, 2015 and August 8, 2023 authorizations combined, the Company had repurchased an aggregate of 667,496 shares for a total cost of $12.9 million, completing the July 30, 2015 authorization and leaving $2.1 million available for purchase under the August 8, 2023 authorization. ITEM 6. RESERVED
As of December 31, 2025, under the July 30, 2015, August 8, 2023 and September 10, 2025 authorizations combined, the Company had repurchased an aggregate of 948,382 shares for a total cost of $15.5 million, completing the August 8, 2023 authorization and leaving $2.5 million available for purchase under the September 10, 2025 authorization.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES MARKET FOR COMMON STOCK The Company’s common stock was listed for trading on the NASDAQ Global Select Market during 2024 under the symbol “HSON.” As of January 31, 2025, there were approximately 133 holders of record of the Company’s common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES MARKET FOR COMMON STOCK The Company’s common stock was listed for trading on the NASDAQ Global Select Market through September 5, 2025 under the symbol "HSON".
The Company has repurchased shares from time to time as market conditions warrant. - 15 - Under the new stock repurchase program, the Company intends to repurchase shares through open market purchases, privately negotiated transactions, block purchases, or otherwise in accordance with applicable federal securities laws, including Rule 10b-18 of the Securities Exchange Act of 1934 (the “Exchange Act”).
The Company continues to view share repurchases as an attractive use of capital and may repurchase shares from time to time, as market conditions warrant, through open market purchases, privately negotiated transactions, block trades, or other methods, in accordance with applicable federal securities laws, including Rule 10b-18 of the Securities Exchange Act of 1934 (the “Exchange Act”).
The actual number of stockholders is greater than this number of holders of record and includes stockholders who are beneficial owners but whose shares are held in street name by brokers and other nominees. This number of holders of record also does not include stockholders whose shares may be held in trust by other entities.
As of January 31, 2026, there were approximately 183 holders of record of the Company’s common stock. The actual number of stockholders is greater than this number of holders of record and includes stockholders who are beneficial owners but whose shares are held in street name by brokers and other nominees.
Of these shares, 44,250 shares were repurchased on January 29, 2024 in a transaction with a certain shareholder totaling $0.7 million that excludes tax withholdings.
During the year ended December 31, 2024 the Company repurchased a total of 154,084 shares of its Common Stock for a cost of $2.5 million under this authorization. Of these shares, 44,250 shares were repurchased on January 29, 2024 in connection with a transaction with a certain shareholder totaling $0.7 million that excludes tax withholdings.
The following is a list by fiscal quarter of the market prices of the Company’s common stock.
This number of holders of record also does not include stockholders whose shares may be held in trust by other entities. The following is a list by fiscal quarter of the market prices of the Company’s common stock.
For the year ended December 31, 2023, the Company repurchased 48,234 shares of its common stock on the open market for $1.0 million.
During the year ended December 31, 2025, the Company repurchased a total of 280,886 shares of its Common Stock for an aggregate cost of $2.6 million under these authorizations.
Removed
Further details can be found in Note 13 to the Consolidated Financial Statements in Item 8 included in Part II of this Form 10-K. For the year ended December 31, 2024, the Company repurchased a total of 154,084 shares of its common stock for a cost of $2.5 million under this authorization.
Added
Following the Effective Time of the Merger, on August 22, 2025, the Company issued its preferred stock under the symbol "HSONP". Effective September 5, 2025, in connection with the Company’s name change, the ticker symbol for the Company’s common stock was changed to "STRR" and the symbol for the Company’s preferred stock was changed to "STRRP".
Added
The Company has paid preferred stock dividends, as described in Note 15. Perpetual Preferred Stock.
Added
Of this total, 261,052 shares were repurchased on September 25, 2025, in connection with a transaction with a certain shareholder totaling $2.4 million, and the remaining 19,834 shares were repurchased on the open market for a cost of $0.2 million.

Item 7. Management's Discussion & Analysis

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

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Biggest changeSuch factors, risks, uncertainties, and assumptions include, but are not limited to, (1) global economic fluctuations, (2) the Company’s ability to successfully achieve its strategic initiatives, (3) risks related to potential acquisitions or dispositions of businesses by the Company, (4) the Company’s ability to operate successfully as a company focused on its RPO business, (5) risks related to fluctuations in the Company’s operating results from quarter to quarter due to various factors such as rising inflationary pressures and interest rates, (6) the loss of or material reduction in our business with any of the Company’s largest customers, (7) the ability of clients to terminate their relationship with the Company at any time, (8) competition in the Company’s markets, (9) the negative cash flows and operating losses that may recur in the future, (10) risks relating to how future credit facilities may affect or restrict our operating flexibility, (11) risks associated with the Company’s investment strategy, (12) risks related to international operations, including foreign currency fluctuations, political events, trade wars, natural disasters or health crises, including the Russia-Ukraine war, and potential conflict in the Middle East, (13) the Company’s dependence on key management personnel, (14) the Company’s ability to attract and retain highly skilled professionals, management, and advisors, (15) the Company’s ability to collect accounts receivable, (16) the Company’s ability to maintain costs at an acceptable level, (17) the Company’s heavy reliance on information systems and the impact of potentially losing or failing to develop technology, (18) risks related to providing uninterrupted service to clients, (19) the Company’s exposure to employment-related claims from clients, employers and regulatory authorities, current and former employees in connection with the Company’s business reorganization initiatives, and limits on related insurance coverage, (20) the Company’s ability to utilize net operating loss carryforwards, (21) volatility of the Company’s stock price, (22) the impact of government regulations and deregulation efforts, (23) restrictions imposed by blocking arrangements, (24) risks related to the use of new and evolving technologies, and (25) the adverse impacts of cybersecurity threats and attacks.
Biggest changeSuch factors, risks, uncertainties, and assumptions include, but are not limited to, (1) global economic fluctuations, (2) changes in the cost and availability of commodities, materials, and equipment, (3) risks related to providing uninterrupted service to clients, (4) the ability of clients to terminate their relationship with the Company at any time, (5) risks associated with real estate ownership, (6) the Company’s ability to successfully achieve its strategic initiatives, (7) risks related to fluctuations in the Company’s operating results from quarter to quarter, (8) risks related to potential acquisitions or dispositions of businesses by the Company, (9) our profitability and growth being tied to the success of our operating businesses, (10) risks associated with our financial investments in other businesses, (11) our ability to improve existing products and services and develop, introduce, and market new products and services successfully, (12) the loss of or material reduction in our business with any of the Company’s largest customers, (13) competition in the Company’s markets, (14) risks related to potential decreases in demand for products, (15) our ability to maintain costs at an acceptable level, (16) the negative cash flows and operating losses that may recur in the future, (17) risks related to international operations, including foreign currency fluctuations, political events, trade wars, natural disasters or health crises, including the Russia-Ukraine war, and potential conflict in the Middle East, (18) risks relating to how future credit facilities may affect or restrict our operating flexibility, (19) our ability to generate or borrow sufficient cash to make payments on our indebtedness, (20) risks related to indebtedness, (21) risks associated with the Company’s investment strategy, (22) the Company’s dependence on key management personnel, (23) the Company’s ability to attract and retain highly skilled professionals, management, and advisors, (24) the Company’s ability to collect accounts receivable, (25) the Company’s exposure to legal proceedings, investigations and disputes, and limits on related insurance coverage, (26) the Company’s ability to utilize net operating loss carryforwards, (27) the potential for goodwill impairment, (28) volatility of the Company’s stock price, (29) risks related to our historically low trading volume, (30) risks related to securities or industry analysts, (31) the Company’s ability to declare dividends, (32) risks associated with failure to pay dividends on our Series A Preferred Stock, (33) our history of annual net losses, (34) risks related to our international operations, (35) risks related to compliance with federal and state laws, regulations, and other rules, (36) our exposure to employment-related claims, legal liability, and costs from clients, employees, and regulatory authorities, (37) risks related to the imposition of licensing or tax requirements or new regulations, (38) the effect of Anti-takeover provisions in our organizational documents, (39) the effect of the protective amendment contained in our Restated Certificate of Incorporation, (40) the impact of our stockholder rights plan, or “poison pill,” on stockholder decision making, (41) risks related to our scaled disclosure requirements as a smaller reporting company, (42) risks related to evolving ESG and DEI rules and regulations, (43) the Company’s heavy reliance on information systems and the impact of potentially losing or failing to develop technology, (44) the adverse impacts of cybersecurity threats and attacks, and (45) risks related to the use of new and evolving technologies.
Revenue Recognition The Company recognizes revenue for our RPO business over time in an amount that reflects the consideration we expect to be entitled to and have an enforceable right to payment in exchange for our services. The client simultaneously receives and consumes the benefits of the services as they are provided.
Revenue Recognition Business Services The Company recognizes revenue for our RPO business over time in an amount that reflects the consideration we expect to be entitled to and have an enforceable right to payment in exchange for our services. The client simultaneously receives and consumes the benefits of the services as they are provided.
The Company believes that it has sufficient liquidity to satisfy its needs through at least the next 12 months, based on the Company’s financial position as of December 31, 2024. The Company’s near-term cash requirements during 2025 are primarily related to the funding of the Company’s operations.
The Company believes that it has sufficient liquidity to satisfy its needs through at least the next 12 months, based on the Company’s financial position as of December 31, 2025. The Company’s near-term cash requirements during 2025 are primarily related to the funding of the Company’s operations.
We elected to continue our historical practice of classifying applicable interest and penalties as a component of the provision for income taxes. We provide tax reserves for federal, state, local and international exposures relating to periods subject to audit.
We elected to continue our historical practice of classifying applicable interest and penalties as a component of the - 35 - provision for income taxes. We provide tax reserves for federal, state, local and international exposures relating to periods subject to audit.
For the year ended December 31, 2024, the effective tax rates differed from the U.S. federal statutory rate of 21% primarily due to pre-tax losses for which no tax benefit can be recognized, changes in valuation allowances in the U.S., China, and certain foreign jurisdictions that reduce or eliminate the ETR on current year profits or losses, foreign tax rate differences, and non-deductible expenses.
For the year ended December 31, 2025, the effective tax rates differed from the U.S. federal statutory rate of 21% primarily due to pre-tax losses for which no tax benefit can be recognized, changes in valuation allowances in the U.S., China, and certain foreign jurisdictions that reduce or eliminate the ETR on current year profits or losses, foreign tax rate differences, and non-deductible expenses.
Please see “FORWARD-LOOKING STATEMENTS” for a discussion of the uncertainties, risks, and assumptions associated with these statements. This MD&A also uses the non-generally accepted accounting principle measure of earnings before interest, taxes, depreciation and amortization (“EBITDA”). See Note 17 to the Consolidated Financial Statements in Item 8 for EBITDA segment reconciliation information.
Please see “FORWARD-LOOKING STATEMENTS” for a discussion of the uncertainties, risks, and assumptions associated with these statements. This MD&A also uses the non-generally accepted accounting principle measure of earnings before interest, taxes, depreciation and amortization (“EBITDA”). See Note 18 to the Consolidated Financial Statements in Item 8 for EBITDA segment reconciliation information.
See Note 7 to the Consolidated Financial Statements in Item 8 for further information regarding deferred tax assets and valuation allowances.
See Note 8 to the Consolidated Financial Statements in Item 8 for further information regarding deferred tax assets and valuation allowances.
As of December 31, 2024, the Company’s gross liability for income taxes associated with uncertain tax positions was $0.1 million. The Company’s unrecognized tax benefits, if recognized in the future, would affect the Company’s annual effective income tax rate. See Note 7 to the Consolidated Financial Statements in Item 8 for further information regarding unrecognized tax benefits.
As of December 31, 2025, the Company’s gross liability for income taxes associated with uncertain tax positions was $0.1 million. The Company’s unrecognized tax benefits, if recognized in the future, would affect the Company’s annual effective income tax rate. See Note 8 to the Consolidated Financial Statements in Item 8 for further information regarding unrecognized tax benefits.
The Company recognizes revenue for our contracting services over time as services are performed in an amount that reflects the consideration we expect to be entitled to and have an enforceable right to payment in exchange for our services, which is generally calculated as hours worked multiplied by the agreed-upon hourly bill rate.
The Business Services segment recognizes revenue for our contracting services over time as services are performed in an amount that reflects the consideration we expect to be entitled to and have an enforceable right to payment in exchange for - 34 - our services, which is generally calculated as hours worked multiplied by the agreed-upon hourly bill rate.
Additionally, we will continue to monitor capital markets for opportunities to repurchase shares, and consider other actions designed to enhance value to our stockholders, as well as review information regarding potential acquisitions or combinations, both within the RPO business line as well as other businesses, and provide information to third parties regarding potential dispositions of assets or business lines, from time to time.
Additionally, we will continue to monitor capital markets for opportunities to repurchase shares, and consider other actions designed to enhance value to our stockholders, as well as review information regarding potential acquisitions or combinations, and provide information to third parties regarding potential dispositions of assets or business lines, from time to time.
The decline was principally from the Company’s lower net income in 2024, partially offset by more favorable working capital comparisons to the prior year. Cash Flows from Investing Activities For the year ended December 31, 2024, net cash provided by investing activities was $1.1 million, compared to $2.2 million of net cash used in investing activities in 2023.
The decline in cash was principally from the Company’s lower net income in 2025, partially offset by more favorable working capital comparisons to the prior year. Cash Flows from Investing Activities For the year ended December 31, 2025, net cash provided by investing activities was $4.6 million, compared to $1.1 million of net cash provided by investing activities in 2024.
The costs incurred to fulfill these contracts are expensed as incurred. - 27 - As a practical expedient, we do not disclose the value of unsatisfied performance obligations for (i) contracts with an expected original duration of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.
As a practical expedient, we do not disclose the value of unsatisfied performance obligations for (i) contracts with an expected original duration of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.
Other income (expense), Net Net other expense was $0.0 million for the year ended December 31, 2024, as opposed to net other income of $0.8 million for the same period in 2023.
Other Income (Expense), Net Net other expense was $0.4 million for the year ended December 31, 2025, as opposed to net other expense of $0.0 million for the same period in 2024.
The following table summarizes the cash flow activities for the years ended December 31, 2024 and 2023: For The Year Ended December 31, $ in millions 2024 2023 Net cash (used in) provided by operating activities $ (2.8) $ 0.3 Net cash provided by (used in) investing activities 1.1 (2.2) Net cash used in financing activities (3.1) (2.5) Effect of exchange rates on cash, cash equivalents, and restricted cash (0.7) — Net decrease in cash, cash equivalents, and restricted cash $ (5.5) $ (4.3) * *Does not sum due to rounding Cash Flows from Operating Activities For the year ended December 31, 2024, net cash used in operating activities was $2.8 million, as compared to $0.3 million of net cash provided by operating activities for the same period in 2023, resulting in a decrease in net cash provided by operating activities of $3.1 million.
The following table summarizes the cash flow activities for the years ended December 31, 2025 and 2024: For The Year Ended December 31, $ in millions 2025 2024 Net cash used in operating activities $ (7.3) $ (2.8) Net cash provided by investing activities 4.6 1.1 Net cash used in financing activities (2.0) (3.1) Effect of exchange rates on cash, cash equivalents, and restricted cash 0.4 (0.7) Net decrease in cash, cash equivalents, and restricted cash $ (4.3) $ (5.5) Cash Flows from Operating Activities For the year ended December 31, 2025, net cash used in operating activities was $7.3 million, as compared to $2.8 million of net cash used in operating activities for the same period in 2024, resulting in an increase in net cash used in operating activities of $4.5 million.
The effective tax rate (“ETR”) for the year ended December 31, 2024 was negative 37.5%, compared to 14.4% for 2023.
The effective tax rate (“ETR”) for the year ended December 31, 2025 was negative 53%, compared to negative 37% for 2024.
As of December 31, 2024, $7.5 million of the Company’s cash and cash equivalents noted above was held in the U.S. and the remainder was held internationally, primarily in Australia ($4.1 million), Singapore ($1.3 million), the Philippines ($0.9 million), Hong Kong ($0.9 million), Belgium ($0.8 million), the U.K. ($0.3 million), India ($0.3 million), Canada ($0.2 million), and China ($0.2 million).
As of December 31, 2025, $5.2 million of the Company’s cash and cash equivalents noted above were held in the U.S. and the remainder were held outside the U.S., primarily in Singapore ($1.3 million) Philippines ($0.9 million), the U.K. ($0.9 million), Hong Kong ($0.8 million), and India ($0.3 million).
The Company has elected to recognize the tax on Global Intangible Low Taxed Income (“GILTI”) as a period expense in the year the tax is incurred. - 28 - Business Combinations and Asset Acquisitions Business Combinations are accounted for under the acquisition method in accordance with ASC 805, “ Business Combinations .” The acquisition method requires identifiable assets acquired and liabilities assumed and any non-controlling interest in the business acquired to be recognized and measured at fair value on the acquisition date, which is the date that the acquirer obtains control of the acquired business.
Business Combinations and Asset Acquisitions Business Combinations are accounted for under the acquisition method in accordance with ASC 805, “ Business Combinations .” The acquisition method requires identifiable assets acquired and liabilities assumed and any non-controlling interest in the business acquired to be recognized and measured at fair value on the acquisition date, which is the date that the acquirer obtains control of the acquired business.
For matters that reach the threshold of probable and estimable, the Company establishes reserves for legal, regulatory, and other contingent liabilities. The Company did not have any reserves as of December 31, 2024 and 2023.
For matters that reach the threshold of probable and estimable, the Company establishes reserves for legal, regulatory, and other contingent liabilities. The Company had $0.2 million and $0.0 million of legal reserves as of December 31, 2025 and 2024, respectively.
Basic and diluted losses per share were $1.59 for the year ended December 31, 2024, compared to basic and diluted income per share of $0.72 and $0.70, respectively, in 2023. Liquidity and Capital Resources As of December 31, 2024, cash and cash equivalents and restricted cash totaled $17.7 million, as compared to $23.2 million as of December 31, 2023.
Basic and diluted loss per share was $2.08 for the year ended December 31, 2025, compared to basic and diluted loss per share of $1.59 in 2024. - 32 - Liquidity and Capital Resources As of December 31, 2025, cash and cash equivalents and restricted cash totaled $13.4 million, as compared to $17.7 million as of December 31, 2024.
Depreciation and Amortization Expense Depreciation and amortization expense was $1.4 million and $1.5 million for the years ended December 31, 2024 and 2023, respectively. Interest Income, Net Net interest income was $0.4 million for each of the years ended December 31, 2024 and 2023.
Total Depreciation and Amortization Expense Depreciation and amortization expense, including amounts in Cost of Revenues, was $2.1 million and $1.4 million for the years ended December 31, 2025 and 2024, respectively. Interest Income, Net Net interest income was $0.3 million and $0.4 million for the years ended December 31, 2025 and 2024, respectively.
Forward-Looking Statements This Form 10-K contains statements that the Company believes to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995.
Recent Accounting Pronouncements See Note 3 to our Consolidated Financial Statements in Item 8 regarding the impact or potential impact of recent accounting pronouncements upon our financial position and results of operations. - 36 - Forward-Looking Statements This Form 10-K contains statements that the Company believes to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995.
Management uses this measurement to evaluate capital needs and working capital requirements. Similar to constant currency, EBITDA should not be considered in isolation or as a substitute for operating income or net income prepared in accordance with U.S. GAAP or as a measure of the Company’s profitability.
Similar to constant currency, EBITDA should not be considered in isolation or as a substitute for operating income or net income prepared in accordance with U.S. GAAP or as a measure of the Company’s profitability. EBITDA is derived from net income (loss) adjusted for the provision for (benefit from) income taxes, interest expense (income), and depreciation and amortization.
The client simultaneously receives and consumes the benefits of the services as they are provided. We do not incur incremental costs to obtain our contracting contracts.
The client simultaneously receives and consumes the benefits of the services as they are provided. We do not incur incremental costs to obtain our contracting contracts. The costs incurred to fulfill these contracts are expensed as incurred. Building Solutions and Energy Services We recognize revenue when a customer obtains control of promised goods or services.
In 2024, the market conditions remained challenging due to persistent inflation, higher interest rates and decreased demand for labor in certain markets. We anticipate that these challenging market conditions will continue into 2025. Economic conditions in most of the world’s major markets continued to slow down throughout 2024.
In 2025, the market conditions remained challenging due to persistent inflation, market uncertainty related to trade disruptions, and decreased demand for labor in certain markets. We anticipate that these challenging market conditions will continue into 2026.
Net (Loss) Income Net loss was $4.8 million for the year ended December 31, 2024, compared to net income of $2.2 million for 2023, a decrease in net income of $7.0 million.
Net (Loss) Income Attributable to Common Shareholders Net loss attributable to common shareholders was $6.7 million for the year ended December 31, 2025, compared to net loss of $4.8 million for 2024, an increase in net loss of $1.9 million.
Adjusted net revenue - EMEA Year Ended December 31, 2024 2023 Change in amount Change in % $ in millions As reported Constant currency EMEA Adjusted net revenue $ 15.6 $ 16.9 $ (1.3) (8) % Adjusted net revenue as a percentage of revenue 61 % 63 % N/A N/A For the year ended December 31, 2024, adjusted net revenue decreased by $1.3 million, or 8%, driven by a decrease in RPO adjusted net revenue of $1.4 million, or 9%, compared to the same period in 2023, partially offset by an increase in contracting adjusted net revenue of $0.1 million, or 34%.
Business Services Revenue - Business Services Year Ended December 31, $ in millions 2025 2024 Change in amount Change in % Business Services Revenue $ 139.7 $ 140.1 $ (0.4) — % For the year ended December 31, 2025, revenue decreased $0.4 million compared to 2024, driven by a decrease in contracting revenue of $0.8 million, partially offset by an increase in RPO revenue of $0.4 million, as discussed below.
Operating Income and EBITDA - EMEA Year Ended December 31, 2024 2023 Change in amount Change in % $ in millions As reported Constant currency EMEA Operating income: $ 0.5 $ 2.0 $ (1.5) (74) % EBITDA $ 0.3 $ 1.6 $ (1.3) (82) % EBITDA as a percentage of revenue 1 % 6 % N/A N/A Operating income was $0.5 million for the year ended December 31, 2024, compared to $2.0 million for 2023.
Operating (Loss) Income and EBITDA - Building Solutions Year Ended December 31, $ in millions 2025 2024 Change in amount Change in % Building Solutions Operating income $ 2.0 $ — $ 2.0 N/A EBITDA $ 2.4 $ — $ 2.4 N/A EBITDA as a percentage of revenue 9 % N/A N/A N/A For the year ended December 31, 2025, Building Solutions generated operating income of $2.0 million and EBITDA of $2.4 million, or 9% of revenue.
SG&A and Non-Op - Asia Pacific Year Ended December 31, 2024 2023 Change in amount Change in % $ in millions As reported Constant currency Asia Pacific SG&A and Non-Op $ 28.7 $ 27.4 $ 1.3 5 % SG&A and Non-Op as a percentage of revenue 33 % 27 % N/A N/A For the year ended December 31, 2024, SG&A and Non-Op increased $1.3 million, or 5%, compared to 2023.
SG&A and Non-Op other income (expense) - Building Solutions Year Ended December 31, $ in millions 2025 2024 Change in amount Change in % Building Solutions SG&A and Non-Op other income (expense) $ 4.1 $ — $ 4.1 N/A SG&A and Non-Op other income (expense) as a percentage of revenue 15 % N/A N/A N/A For the year ended December 31, 2025, Building Solutions SG&A and Non-op other income (expense) was 4.1 million or 15% of revenue.
The Company also has the capability to borrow an additional 4 million Australian dollars under the NAB Facility Agreement. Other than as described above, the Company has no financial guarantees, outstanding debt or other lease agreements or arrangements that could trigger a requirement for an early payment or that could change the value of our assets.
Other than as described in Note 9 – Debt in the consolidated financial statements included in Part II, Item 8 of this Form 10-K, the Company has no financial guarantees, outstanding debt or other lease agreements or arrangements that could trigger a requirement for an early payment or that could change the value of our assets.
SG&A and Non-Op - Americas Year Ended December 31, 2024 2023 Change in amount Change in % $ in millions As reported As reported Americas SG&A and Non-Op $ 25.0 $ 31.2 $ (6.2) (20) % SG&A and Non-Op as a percentage of revenue 90 % 100 % N/A N/A For the year ended December 31, 2024, SG&A and Non-Op decreased $6.2 million, or 20%, compared to 2023, while SG&A and Non-Op as a percentage of revenue decreased from 100% to 90%.
SG&A and Non-Op other income (expense) - Investments Year Ended December 31, $ in millions 2025 2024 Change in amount Change in % Investments SG&A and Non-Op other income (expense) $ 0.2 $ — $ 0.2 N/A SG&A and Non-Op other income (expense) as a percentage of revenue 108 % N/A N/A N/A For the year ended December 31, 2025, Investments SG&A and Non-Op other income (expense) was $0.2 million. - 31 - Operating (Loss) Income and EBITDA - Investments Year Ended December 31, $ in millions 2025 2024 Change in amount Change in % Investments Operating loss $ (0.01) $ — $ (0.01) N/A EBITDA (loss) $ (0.01) $ — $ (0.01) N/A EBITDA (loss) as a percentage of revenue (8) % N/A N/A N/A For the year ended December 31, 2025, Investments operating loss was $0.01 million, and EBITDA loss was $0.01 million, or 8% of revenue.
The decrease in net other income was primarily due to a benefit payout of $1.1 million, partially offset by one-time client administrative costs of $0.2 million, both of which were incurred in the prior year. - 24 - Provision for (benefit from) Income Taxes The provision for income taxes for the year ended December 31, 2024 was $1.3 million, on $3.5 million of pre-tax loss, compared to a provision from income taxes of $0.4 million on $2.6 million of pre-tax income for 2023.
Provision for (benefit from) Income Taxes The provision for income taxes for the year ended December 31, 2025 was $2.1 million, on $3.9 million of pre-tax loss, compared to a provision from income taxes of $1.3 million on $3.5 million of pre-tax loss for 2024.
GAAP financial measure is provided in the table below: Year Ended December 31, $ in thousands 2024 2023 Net (loss) income $ (4,770) $ 2,198 Adjustments to net (loss) income Provision for income taxes 1,300 370 Interest income, net (360) (372) Depreciation and amortization expense 1,361 1,467 Total adjustments from net (loss) income to EBITDA 2,301 1,465 EBITDA (loss) $ (2,469) $ 3,663 - 19 - Results of Operations: Americas (reported currency) Revenue - Americas Year Ended December 31, 2024 2023 Change in amount Change in % $ in millions As reported As reported Americas Revenue $ 27.9 $ 31.3 $ (3.4) (11) % For the year ended December 31, 2024, RPO revenue decreased by $5.7 million, or 19%, while contracting revenue increased by $2.3 million, or 240%.
GAAP financial measure is provided in the table below: Year Ended December 31, $ in thousands 2025 2024 Net loss attributable to common shareholders $ (6,657) $ (4,770) Dividends on Series A perpetual preferred stock 740 — Net loss (5,917) (4,770) Adjustments to net (loss) income Provision for income taxes 2,061 1,300 Interest income, net (260) (360) Depreciation and amortization expense-within cost of revenues 866 — Depreciation and amortization expense -within selling, general and administrative expense 1,212 1,361 Total adjustments from net (loss) income to EBITDA 3,879 2,301 EBITDA loss $ (2,038) $ (2,469) - 27 - Results of Operations Building Solutions Revenue - Building Solutions Year Ended December 31, $ in millions 2025 2024 Change in amount Change in % Building Solutions Revenue $ 27.6 $ — $ 27.6 N/A For the year ended December 31, 2025, Building Solutions contributed $27.6 million to the Company's revenue.
Use of EBITDA (Non-GAAP Financial Measure) Management believes EBITDA is a meaningful indicator of the Company’s performance that provides useful information to investors regarding the Company’s financial condition and results of operations. EBITDA is considered by management as an indicator of operating performance and the most comparable measure across the regions in which we operate.
EBITDA is considered by management as an indicator of operating performance and the most comparable measure across the regions in which we operate. Management uses this measurement to evaluate capital needs and working capital requirements.
In the U.K., total adjusted net revenue for the year ended December 31, 2024 decreased by $2.4 million, or 16%, compared to the same period in 2023, driven by a decrease in RPO adjusted net revenue of $2.6 million, or 17%.
In EMEA, revenue decreased $2.1 million, or 8%, for the year-ended December 31, 2025, compared to the same period in 2024, driven by a decline in RPO revenue of $3.2 million, or 20%, partly offset by an increase in contracting revenue of $1.1 million, or 12%.
SG&A and Non-Op - EMEA Year Ended December 31, 2024 2023 Change in amount Change in % $ in millions As reported Constant currency EMEA SG&A and Non-Op $ 15.3 $ 15.2 $ 0.1 — % SG&A and Non-Op as a percentage of revenue 60 % 57 % N/A N/A - 23 - For the year ended December 31, 2024, SG&A and Non-Op increased by $0.1 million, or 0%, compared to 2023.
SG&A and Non-Op other income (expense) - Business Services Year Ended December 31, $ in millions 2025 2024 Change in amount Change in % Business Services SG&A and Non-Op other income (expense) $ 70.4 $ 69.0 $ 1.4 2 % SG&A and Non-Op other income (expense) as a percentage of revenue 50 % 50 % — N/A For the year ended December 31, 2025, SG&A and Non-Op other income (expense) increased $1.4 million, or 2%, compared to the same period in 2024, while SG&A and Non-Op other income (expense) as a percentage of revenue remained unchanged at 50%. - 29 - Operating Income and EBITDA - Business Services Year Ended December 31, $ in millions 2025 2024 Change in amount Change in % Business Services Operating income $ 1.9 $ 1.0 $ 1.0 97 % EBITDA $ 1.4 $ 1.1 $ 0.3 24 % EBITDA as a percentage of revenue 1 % 1 % N/A N/A For the year ended December 31, 2025, operating income was $1.9 million, compared to operating income of $1.0 million in 2024, and EBITDA was $1.4 million, or 1% of revenue, compared to EBITDA of $1.1 million, or 1% of revenue, in 2024.
For the year ended December 31, 2024, EBITDA was $0.3 million, or 1% of revenue, compared to EBITDA loss of $0.7 million, or 2% of revenue, in 2023. The increase in EBITDA was due to the same factors noted above.
Summary of Financial Performance Highlights For the Year Ended December 31, 2025 • Revenue was $172.2 million for the year ended December 31, 2025, compared to $140.1 million for the same period in 2024, an increase of $32.1 million, or 22.9%.
In Asia, revenue increased $4.9 million, or 49%, for the year ended December 31, 2024, compared to 2023. The increase in revenue was primarily driven by the Singapore Acquisition, which contributed 57 percentage points to the revenue growth.
The increase in revenue was principally driven by the inclusion of revenues from the Star Operating Companies acquisition, which contributed 23 percentage points to the revenue growth. • Gross profit was $79.9 million for the year ended December 31, 2025, compared to $70.2 million for the same period in 2024, an increase of $9.7 million, or 13.9%.
In Continental Europe, for the year ended December 31, 2024, total adjusted net revenue increased by $0.9 million, or 70%, compared to the same period in 2023, due to new client wins. In the Middle East, total adjusted net revenue and RPO adjusted net revenue was $0.2 million for the year ended December 31, 2024.
In Asia Pacific, revenue increased $0.1 million for the year-ended December 31, 2025, compared to the same period in 2024. RPO revenue increased $2.4 million, or 9%, due to stronger existing client demand, while contracting revenue decreased $2.3 million, or 4%, due to lower client demand.
Transaction costs are expensed in a business combination and are considered a component of the cost of the acquisition in an asset acquisition. Recent Accounting Pronouncements See Note 2 to our Consolidated Financial Statements in Item 8 regarding the impact or potential impact of recent accounting pronouncements upon our financial position and results of operations.
Transaction costs are expensed in a business combination and are considered a component of the cost of the acquisition in an asset acquisition.
The increase in net cash used was primarily attributed to repurchases of shares of common stock of $2.8 million in 2024, including cash paid for tax withholdings, compared to repurchases of $1.0 million in the previous year.
Repurchases of shares of common stock were $2.6 million in 2025, including cash paid for tax withholdings, compared to repurchases of $2.8 million in the previous year. Credit Facilities See Note 9, Debt, in the accompanying notes to the consolidated financial statements for further details.
This MD&A includes the following sections: • Executive Overview • Results of Operations • Liquidity and Capital Resources • Contingencies • Critical Accounting Estimates • Recent Accounting Pronouncements • Forward-Looking Statements Executive Overview The Company’s objective is to increase value to the Company’s stockholders by providing global Recruitment Process Outsourcing (“RPO”) solutions to customers.
Note that amounts within this Item shown in millions may not recalculate due to rounding. This MD&A includes the following sections: • Executive Overview • Results of Operations • Liquidity and Capital Resources • Contingencies • Critical Accounting Estimates • Recent Accounting Pronouncements • Forward-Looking Statements - 23 - Executive Overview Star Equity Holdings, Inc.
In Australia, for the year ended December 31, 2024, revenue decreased $21.3 million, or 23%, compared to 2023. The decline was primarily in contracting revenue, which decreased by $13.4 million, or 20%, while RPO revenue, decreased by $7.8 million, or 31%. The decreases in both contracting and RPO revenue were primarily due to lower demand from existing clients.
In the Americas, revenue increased $1.5 million, or 5%, for the year ended December 31, 2025, compared to the same period in 2024. The increase was primarily driven by RPO revenue, which increased $1.1 million, or 5%, while contracting revenue increased $0.4 million, or 12%, due to higher demand from existing clients as well as new client wins.
In the U.K., for the year ended December 31, 2024, revenue decreased by $2.6 million, or 10%, to $22.9 million from $25.5 million in 2023. The decrease was principally driven by lower RPO revenue of $2.5 million.
In EMEA, gross profit declined by $2.9 million, or 19%, for the year ended December 31, 2025, compared to the same period in 2024, primarily driven by a decrease in RPO gross profit of $2.8 million, or 18%. The decrease in gross profit was due to lower client demand.
Operating Income and EBITDA - Asia Pacific Year Ended December 31, 2024 2023 Change in amount Change in % $ in millions As reported Constant currency Asia Pacific Operating income $ 1.1 $ 6.9 $ (5.8) (85) % EBITDA $ 0.5 $ 5.8 $ (5.3) (92) % EBITDA as a percentage of revenue 1 % 6 % N/A N/A Operating income was $1.1 million for the year ended December 31, 2024, compared to $6.9 million for 2023.
SG&A and Non-Op other income (expense) - Energy Services Year Ended December 31, $ in millions 2025 2024 Change in amount Change in % Energy Services SG&A and Non-Op other income (expense) $ 1.4 $ — $ 1.4 N/A SG&A and Non-Op other income (expense) as a percentage of revenue 29 % N/A N/A N/A For the year ended December 31, 2025, Energy Services’ SG&A and non-operating other income (expense) totaled $1.4 million or 29% of revenue.
Net cash provided by investing activities in 2024 reflects $1.1 million in cash received from benefit payouts, while net cash used in investing activities in 2023 primarily reflects cash paid of $2.1 million in October 2023 for the acquisition of Singapore (see Note 5 to the Consolidated Financial Statements in Item 8 for additional information.) - 25 - Cash Flows from Financing Activities For the year ended December 31, 2024, net cash used in financing activities was $3.1 million, compared to $2.5 million in 2023.
Cash Flows from Financing Activities For the year ended December 31, 2025, net cash used in financing activities was $2.0 million, compared to $3.1 million in 2024. The decrease in net cash used was primarily attributed to borrowing under credit facilities.
In Continental Europe, for the year ended December 31, 2024, total revenue was $2.3 million, compared to $1.4 million for 2023, an increase of $0.9 million, or 66%. The increase was primarily due to new client wins. In the Middle East, total revenue and RPO revenue was $0.2 million for the year ended December 31, 2024.
In Asia Pacific, gross profit increased by $3.4 million, or 12%, for the year ended December 31, 2025, compared to the same period in 2024, driven by an increase in RPO gross profit of $2.5 million and an increase in contracting gross profit of $0.9 million, driven by higher demand from existing clients.
The following are discussed in reported currency Corporate expenses, net of corporate management expenses For the year ended December 31, 2024, corporate expenses were $3.6 million compared to $3.0 million for 2023, an increase of $0.6 million, or 20%. The increase was primarily due to lower corporate allocations, partially offset by lower travel and entertainment and stock-based compensation expenses.
Additional Results of Operations Corporate expenses For the year ended December 31, 2025, corporate expenses were $6.9 million compared to $3.6 million in 2024, an increase of $3.3 million, or 92%. The increase was primarily due to professional fees associated with the acquisition of Star Operating Companies.
The interest expense and fees incurred on the HSBC Facility Agreement amounted to $6 thousand and $3 thousand for the years ending December 31, 2024 and 2023, respectively. Liquidity and Capital Resources Outlook As of December 31, 2024, the Company had cash and cash equivalents on hand of $17.0 million.
Liquidity and Capital Resources Outlook As of December 31, 2025, the Company had cash and cash equivalents on hand of $10.3 million, as well as our lines of credit and other debt instruments.
EBITDA is derived from net income (loss) adjusted for the provision for (benefit from) income taxes, interest expense (income), and depreciation and amortization. The reconciliation of EBITDA to the most directly comparable U.S.
The reconciliation of EBITDA to the most directly comparable U.S.
Federal statutory rate of 21% primarily due to a discrete tax benefit recognized following the lapse of certain statutes of limitations related to Spain, recognition of a portion of a deferred tax asset in Canada, state income taxes, changes in valuation allowances in the U.S. and certain foreign jurisdictions which reduces or eliminates the ETR on current year profits or losses, foreign tax rate differences, taxes on repatriations or deemed repatriation of foreign profits, and non-deductible expenses.
For the year ended December 31, 2024, the effective tax rates differed from the U.S. federal statutory rate of 21% primarily due to pre-tax losses for which no tax benefit can be recognized, changes in valuation allowances in the U.S., China, and certain foreign jurisdictions that reduce or eliminate the ETR on current year profits or losses, foreign tax rate differences, and non-deductible expenses The current year ETR differs significantly from the prior year ETR primarily due to the interaction of similar rate reconciliation items, including change in valuation allowance, combined with a shift in the geographic mix of earnings toward higher‑tax jurisdictions, including Australia.
The decrease in operating income was principally due to the changes in adjusted net revenue and SG&A and Non-Op, as described above. For the year ended December 31, 2024, EBITDA was $0.5 million, or 1% of revenue, compared to EBITDA of $5.8 million, or 6% of revenue, in 2023.
The increase in gross profit was driven by the acquisition of Star Operating Companies, which increased gross profit growth by 12 percentage points. • SG&A and Non-Op other income (expense) was 82.8 million for the year ended December 31, 2025, compared to $72.6 million for the same period in 2024.
Adjusted net revenue - Asia Pacific Year Ended December 31, 2024 2023 Change in amount Change in % $ in millions As reported Constant currency Asia Pacific Adjusted net revenue $ 29.4 $ 33.4 $ (4.0) (12) % Adjusted net revenue as a percentage of revenue 34 % 32 % N/A N/A For the year ended December 31, 2024, RPO adjusted net revenue decreased by $3.2 million, or 11%, while contracting adjusted net revenue decreased by $0.8 million, or 24%, compared to the same period in 2023. - 21 - In Australia, adjusted net revenue decreased by $8.0 million, or 29%, for the year ended December 31, 2024, compared to the same period in 2023.
Gross Profit - Business Services Year Ended December 31, $ in millions 2025 2024 Change in amount Change in % Business Services Gross Profit $ 71.8 $ 70.2 $ 1.6 2 % For the year ended December 31, 2025, gross profit increased $1.6 million or 2%, driven by an increase in contracting gross profit of $1.0 million and an increase in RPO gross profit of $0.7 million, compared to the same period in 2024.
This MD&A discusses the results of the Company’s RPO business for the years ended December 31, 2024 and 2023. Current Market Conditions Our clients’ demands for RPO and contracting services largely depend on the market conditions and the strength of the labor markets in the countries where we operate.
Our sales pipelines continue to indicate strong potential demand for our services, but we can give no assurances as to our ability to compete for these opportunities, or the periods during which successfully negotiated projects will be completed. - 25 - In our Business Services segment, our clients’ demands for RPO and contracting services largely depend on the market conditions and the strength of the labor markets in the countries where we operate.
The decrease was primarily reflected in RPO adjusted net revenue, which declined by $7.4 million, or 31%, while contracting adjusted net revenue decreased by $0.6 million, or 19%, compared to 2023. In Asia, adjusted net revenue increased $4.0 million, or 67%, for the year ended December 31, 2024, compared to 2023.
In the Americas, gross profit increased by $1.1 million, or 4%, for the year ended December 31, 2025, compared to the same period in 2024. The growth reflects a $0.9 million, or 4%, increase in RPO gross profit, along with a $0.2 million, or 24%, increase in contracting gross profit.
Removed
Note that amounts within this Item shown in millions may not recalculate due to rounding.
Added
(“Star Equity,” “Star,” the “Company,” “we,” or “our,” formerly known as Hudson Global, Inc. (“Hudson”)) is a diversified multi-industry holding company operating through four reportable segments: Building Solutions, Business Services, Energy Services, and Investments. Our common stock and 10% Series A Cumulative Perpetual Preferred Stock are listed on the Nasdaq Global Market under the symbols “STRR” and “STRRP,” respectively.
Removed
With direct operations in sixteen countries and relationships with specialized professionals and organizations around the globe, the Company brings a strong ability to match talent with opportunities by assessing, recruiting, developing, and engaging highly successful people for the Company’s clients.
Added
The Building Solutions segment operates in the construction industry. The Business Services segment, which consists of HTS, delivers customized recruitment and contracting solutions to mid-to-large multinational companies, including Recruitment Process Outsourcing (“ RPO ”) , project-based RPO, contingent workforce solutions, recruitment consulting, outsourced professional contract staffing, and MSP services.
Removed
The Company combines broad geographic presence, world-class talent solutions and a tailored, consultative approach to help businesses and professionals achieve maximum performance. The Company’s focus is to continually upgrade its service offerings and delivery capability tools to make the Company and candidates more successful in achieving clients’ business requirements.
Added
The Energy Services segment consists of ADT, which manufactures and supplies specialized drilling tools and downhole equipment used in directional drilling and other oil and gas well construction applications. The Investments segment holds and manages certain corporate-owned real estate assets and investments in a limited number of publicly traded and private companies.
Removed
The Company’s proprietary frameworks, assessment tools, and leadership development programs, coupled with its broad geographic footprint, allow the Company to design and implement regional and global outsourced recruitment solutions that the Company believes greatly enhance the quality and efficiency of its clients’ hiring.
Added
Merger On August 22, 2025, Star completed its previously announced acquisition of Star Operating Companies (formerly known as Star Equity Holdings, Inc.) pursuant to the Merger Agreement, by and among Star, SOC and Merger Sub.
Removed
To meet the Company’s objective, the Company engages in the following initiatives: - 16 - • Facilitating growth and development of the global RPO business through strategic investments in people, innovation, and technology; • Building and differentiating the Company’s brand through its unique outsourcing solutions offerings; and • Improving the Company’s cost structure and efficiency of its support functions and infrastructure.
Added
Upon the terms and subject to the conditions of the Merger Agreement, on August 22, 2025, at the Effective Time of the Merger, Merger Sub merged with and into SOC, with SOC continuing as the surviving corporation of the Merger under the name “Star Operating Companies, Inc." as a wholly owned subsidiary of Star.
Removed
Higher than expected inflation in most markets and rising interest rates have led to significant market disruption, including further wage inflation, increased operating costs, staffing challenges, reduced consumer confidence, and limited capital market accessibility that impact our business.
Added
Capitalized terms used herein but not defined have the meanings set forth in the Merger Agreement.
Removed
In addition, in connection with the challenging business environment, some of our customers have reduced demand, and certain other customers have eliminated our services on a temporary or permanent basis. These conditions and expected future inflation and potential interest rate increases could have material adverse impacts on various aspects of our business in the future.
Added
Pursuant to the terms of the Merger Agreement, at the Effective Time, (i) each share of common stock of SOC issued and outstanding immediately prior to the Effective Time (other than certain shares as set forth in the Merger Agreement) were automatically converted into the right to receive 0.23 shares of Star common stock and (ii) each share of preferred stock of SOC issued and outstanding immediately prior to the Effective Time (other than certain shares set forth in the Merger Agreement) were automatically converted into the right to receive one (1) share of Star 10% Series A Cumulative Perpetual Preferred Stock.
Removed
The continued economic uncertainty has also resulted in volatility in global currencies. Stronger foreign currencies in other markets compared to the U.S. dollar during a reporting period cause local currency results of the Company’s foreign operations to be translated into more U.S. dollars.
Added
As a result of the Merger, former SOC common stockholders received approximately 744,291 shares of Star common stock for their SOC common shares and former SOC preferred stockholders received approximately 2,690,637 shares of Star Preferred Stock.
Removed
Constant Currency (Non-GAAP Financial Measure) The Company operates on a global basis, with the majority of its revenue generated outside of the U.S. Accordingly, fluctuations in foreign currency exchange rates can affect our results of operations. For the discussion of reportable segment results of operations, the Company uses constant currency information.
Added
No fractional shares of Star common stock were issued in the Merger, and SOC stockholders became entitled to receive cash in lieu of fractional shares in accordance with the Merger Agreement.
Removed
Constant currency compares financial results between periods as if exchange rates had remained constant period-over-period. The Company defines the term “constant currency” to mean that financial data for previously reported periods are translated into U.S. dollars using the same foreign currency exchange rates that were used to translate financial data for the current period.
Added
In addition, pursuant to the terms of the Merger Agreement, at the Effective Time, each award of SOC RSUs outstanding immediately prior to the Effective Time was converted into Star RSUs issued under the Hudson Global, Inc. 2009 Incentive Stock and Awards Plan, as amended (the “Plan”), in accordance with the Merger Agreement.
Removed
Constant currency metrics should not be considered in isolation or as a substitute for reported results prepared in accordance with generally accepted accounting principles (“GAAP”) in the U.S. The Company’s management reviews and analyzes business results in constant currency because it believes these results better represent the Company’s underlying business trends.
Added
Amendment to Certificate of Incorporation On September 4, 2025, Star Equity filed an Amendment to the Company’s Charter, to affect the Name Change. The Name Change was approved by the Company’s Board on September 2, 2025, and became effective at 12:01 a.m. (Eastern Time) on September 5, 2025.
Removed
Financial Performance The following is a summary of the Company’s financial performance highlights for the years ended December 31, 2024 and 2023.
Added
Segments The Company’s Building Solutions segment consists of the following operating businesses: KBS; EdgeBuilder; Glenbrook; and TT. KBS, based in Maine, manufactures modular buildings, primarily serving the single-family and multi-family residential markets in New England.
Removed
This summary should be considered in the context of the additional disclosures in this MD&A which further highlight the Company’s results by segment. • Revenue was $140.1 million for the year ended December 31, 2024, compared to $161.3 million for 2023, a decrease of $21.3 million, or 13%.
Added
EBGL, based in the Minneapolis–Saint Paul area, manufactures and delivers structural wall panels and other engineered wood-based products and distributes building materials through two lumberyard locations, primarily serving professional builder customers in the Upper Midwest region.

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