CTG (NASDAQ: CTG), an IT solutions and staffing provider, reported fourth-quarter revenue fell 30.7%. However, gross margin improved.

The Buffalo, New York-based firm noted the change in revenue reflects last year’s fourth quarter, which benefitted more than $25 million from a major health system engagement in North America, and $9.3 million related to the intentional disengagement from lower-margin non-strategic technology services business.

“We are very excited about the momentum we have underway, with strong fourth-quarter results that reflect an improved mix of digital IT solutions in both North America and Europe,” President and CEO Filip Gydé said.

Revenue in the company’s North America IT solutions and services business line fell 49.1%. The segment also includes revenue from Eleviant Technologies,’ which was acquired by CTG on Sept. 29, 2022. Despite lower revenue, CTG noted the segment margins saw substantial expansion, given the improved mix of digital solutions and contribution from Eleviant.

The Europe IT solutions and services segment fell 7.6%. However, the segment benefited from improved utilization, strategic pricing, and a greater mix of digital solutions.

Guidance

CTG lowered its full-year 2023 revenue guidance by $35 million to $40 million from the prior year because of intentional disengagement from the lowest margin business in its non-strategic technology services segment, slightly offset by a full year of revenue from Eleviant. CTG now expects full-year revenue to range from $300 million to $350 million.

Share price and market cap 

Shares in Computer Task Group were up 3.32% to $7.46 as of 11:56 a.m. Eastern time; they were 16.20% above their 52-week low, according to FT.com. The company had a market cap of $113.4 million.