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View All NewsCTG revenue falls 9%, lowers full-year revenue guidance
Second-quarter revenue fell 9.5% at Computer Task Group Inc. (NASD: CTG), reflecting a combination of reduced business and delayed purchase orders at one of its largest staffing clients. The Buffalo, NY-based firm also lowered full-year revenue guidance to reflect weaker demand from several large staffing clients in the second quarter. However, CTG also reported its laying the foundation for growth, including the formalization of a three-year strategic plan.
| (US$ thousands) | Q2 2017 | Q2 2016 | % change |
| Revenue | $75,521 | $83,486 | -9.5% |
| Gross margin percentage | 18.1% | 19.1% | |
| Net income | $434 | $1,259 | -65.5% |
Quote
“Despite the recent weakness at several of our largest staffing clients, we believe the overall market environment continues to be favorable as we build the foundation for future growth,” CEO Bud Crumlish said. “In fact, we currently have the largest proposal pipeline in recent history, and I am very optimistic about the progress we are making to advance a growing number of tangible new business opportunities.”
Revenue by segment and geography
| (US$ thousands) | Q2 2017 | Q2 2016 | % change |
| Revenue by segment | |||
| IT staffing | $52,981 | $58,839 | -10.0% |
| IT Solutions | $22,540 | $24,647 | -8.5% |
| North American revenue | $56,587 | $65,302 | -13.3% |
| European revenue | $18,934 | $18,184 | 4.1% |
Guidance
CTG expects third-quarter revenue to range between $75.0 million and $77.0 million. For the full year 2017, CTG now expects revenue to range between $305.0 million and $315.0 million; this is down from guidance of between $312.0 million and $332.0 million provided with the first-quarter earnings report.
Share price and market cap
Shares in CTG fell 0.43% in early afternoon trading to $5.84 and the firm had a market cap of $90.3 million, according to Yahoo.