Insperity, Inc. (NSP) delivers comprehensive human resources and business solutions primarily designed to enhance the operational efficiency and performance of small and ...
Insperity, Inc. is a Houston-area human resources services provider headquartered in Kingwood, Texas, and traded on the New York Stock Exchange under the symbol NSP. Founded in 1986 as Administaff, the company changed its name to Insperity in 2011. Its mission is to help small and midsize businesses operate more ...Insperity, Inc. is a Houston-area human resources services provider headquartered in Kingwood, Texas, and traded on the New York Stock Exchange under the symbol NSP. Founded in 1986 as Administaff, the company changed its name to Insperity in 2011. Its mission is to help small and midsize businesses operate more effectively by combining outsourced HR administration, technology, compliance assistance, and strategic workforce support. Paul J. Sarvadi, a company co-founder, serves as Chairman and Chief Executive Officer.
The company’s core business is associated with professional employer organization, or PEO, services. Through this model, Insperity can support client companies with payroll processing, employee onboarding, personnel records, benefits administration, workers’ compensation programs, employment practices and regulatory compliance, risk management, and employee-related reporting. Its services are intended to reduce the administrative burden on business owners and provide access to capabilities that may otherwise be expensive or difficult for smaller organizations to build internally. Insperity also provides workforce-management and human capital management technology covering time and attendance, performance reviews, organizational planning, recruiting, employment screening, retirement planning, and insurance-related functions.
Insperity’s described platforms and offerings include Workforce Optimization, Workforce Synchronization, Insperity Premier, MarketPlace, and Workforce Acceleration. These offerings combine software with service personnel and subject-matter expertise rather than relying only on standalone software subscriptions. The company has historically operated a nationwide sales and service footprint, including numerous U.S. sales offices, allowing it to sell directly to local and regional businesses. Its customer base spans a broad range of industries and generally includes organizations that need scalable HR support as they grow.
Because Insperity is primarily a services and technology business, its cost structure is different from that of a manufacturer. It does not have a conventional bill of materials, factory inventory, or physical product BOM. Major economic inputs include payroll-related service delivery, employee benefits and insurance costs, sales personnel, customer support, technology infrastructure, compliance operations, and general and administrative expenses. Client payroll and benefits flows can make revenue appear large relative to the company’s fee-based operating economics, so reported revenue should be interpreted alongside gross margin, operating income, client worksite employees, and recurring service fees.
The supplied trailing-twelve-month data reports approximately $2.01 billion in market capitalization, a $2.4 annual dividend per share, a dividend yield near 4.6%, approximately $275 million of free cash flow to equity, and approximately $467 million of free cash flow to the firm. The same snapshot shows a low net margin and negative reported net income, illustrating that profitability can be affected by benefit costs, insurance-related items, investment results, and other adjustments. The company’s principal long-term opportunities are continued growth in small and midsize-business outsourcing, deeper adoption of integrated HR technology, improved client retention, and expansion of higher-value workforce services. Key risks include employment levels, wage inflation, medical and workers’ compensation claims, regulatory changes, competition from payroll software and other PEO providers, and the need to maintain service quality while controlling costs.
YoYYoY means Year-over-Year. It compares the latest annual value with the previous annual value to show long-term trend strength.
QoQQoQ means Quarter-over-Quarter. It compares the latest quarter with the immediately previous quarter to show short-term momentum changes.
RevenueThe total money that came through the front door from selling things, before paying a single bill. Think of it as the grand total of every credit card swipe from customers. (YoY compares this year to last year's performance, while QoQ compares the current three months to the previous three).
$6.8B
+3.5%
-11.0%
Net IncomeThe absolute bottom line. If the company paid every single supplier, employee, banker, and tax collector, this is the actual money left in their pocket at the end of the day.
$-7.0M
-107.7%
-87.9%
Gross MarginThe basic markup. If they sell a $100 pair of sneakers, this percentage tells you how much of that price tag is profit right after paying for the rubber and shoelaces, but before paying for things like store rent or TV commercials.
+13.2%
-17.3%
-14.3%
Operating MarginThe 'day job' efficiency score. Out of every dollar a customer spends, this shows how many cents the company keeps after making the product AND paying for all the everyday corporate overhead (like salaries, marketing, and keeping the lights on).
-0.1%
-108.3%
-89.1%
Net MarginThe final take-home percentage. When you strip away every conceivable cost, tax, and interest payment, this is the exact number of cents the company truly gets to keep from every dollar in sales.
-0.1%
-107.4%
-86.4%
Free Cash FlowThe holy grail of corporate cash. It's the spendable, physical money left over after the business pays for its daily operations AND buys the big, expensive upgrades (like new factories or servers) it needs to survive. This is the 'free' money they can use to pay dividends or buy back stock.
$-309.0M
-164.1%
+267.1%
FCF MarginThe ultimate cash conversion rate. It shows how good the company is at turning regular sales directly into cold, hard, spendable cash. A high percentage means the business is an absolute cash-printing machine.
-4.5%
-161.9%
+287.8%
Debt / EquityThe financial risk gauge. It compares how much of the company's empire was built using borrowed money (loans) versus the owners' own money (shareholders). A high number means they are heavily leveraged and playing a riskier game; a low number means they are playing it safe.
945.7%
+110.9%
+22.1%
Current RatioThe 12-month survival check. It simply compares the cash they have right now (plus things they can quickly turn into cash) against the immediate bills they absolutely must pay this year. A score above 1 means they have enough in the wallet to cover the upcoming bills without panicking.
1.06x
-1.6%
+2.2%
Total AssetsThe absolute size of the company's empire. It bundles together absolutely everything of value they own—from the cash in the register and the inventory in the warehouse, to the software patents in the vault and the factories on the ground.
Operator: Good day. My name is Ali, and I will be your conference operator today. I would like to welcome everyone to the Insperity First Quarter 2026 Earnings Conference Call. And please note, this conference call is being recorded. At this time, I would like to introduce today's speakers. Joining us are Paul Sarvadi, Chairman of the Board and Chief Executive Officer; and Jim Allison, Executive Vice President of Finance, Chief Financial Officer and Treasurer. At this time, I'd like to turn the call over to Jim Allison. Mr. Allison, please go ahead.
James Allison: Thank you. We appreciate you joining us today. Let me begin by outlining our plan for this afternoon's call. First, I'm going to discuss the details behind our first quarter 2026 financial results. Paul will then comment on 3 strategic initiatives in 2026: Our margin recovery plan, our efforts to rebuild growth momentum, including the HRScale rollout and our AI initiatives. I will return to provide financial guidance for the second quarter and full year 2026. We will then end the call with a question-and-answer session. Before we begin, I would like to remind you that Paul or I may make forward-looking statements during today's call, which are subject to risks, uncertainties and assumptions. In addition, some of our discussion may include non-GAAP financial measures. For a more detailed discussion of the risks and uncertainties that could cause actual results to differ materially from any such forward-looking statements and reconciliations of non-GAAP financial measures to their comparable GAAP measures, please see the company's public filings, including the Form 8-K filed today, which are available on our website. Today, we reported adjusted EPS for the first quarter of $1.31 and adjusted EBITDA of $103 million. Each of these results exceeded the midpoint of our expected range. Our quarterly results included outperformance in gross profit and operating expense management, partially offset by slightly lower-than-expected unit growth. The average number of paid worksite employees came in at the low end of our forecasted range at 303,049, a 1.0% decrease versus Q1 2025. As you may recall from last quarter's call, our fall campaign sales and year-end client retention were both impacted by our margin recovery efforts, which we included in our paid worksite employee guidance. Worksite employees paid from new client sales declined by 7% compared to Q1 2025. Client attrition totaled 11% in Q1 2026, within our historical range of 9% to 12%. Net hiring within the client base was in line with our forecast and slightly higher than Q1 2025, but the hiring occurred later in the quarter than we had expected, which impacted the average worksite employees paid for the quarter. Paul will discuss our worksite employee results in more detail in a few minutes. Total gross profit in Q1 2026 decreased by 3% to $302 million. This represents a significant improvement compared to the 21% decline that we …
