Professional staffing firm Kforce Inc. (NASDAQ: KFRC) reported fourth-quarter revenue fell 13.4% year over year to $363.4 million and was just above midpoint of guidance. 2023 was more challenging than expected, President and CEO Joe Liberatore said in a press release. However, the Tampa, Florida-based firm is prepared to take market share once macroeconomic uncertainties stabilize and clients prioritize backlogs of technology investment, Liberatore said.

“We experienced a decline in technology revenues in 2023 that closely resembles what we experienced in the Great Recession in 2009,” Liberatore said in a conference call with analysts. “We believe the decline that we experienced in 2023 was due to an acceleration of strategic technology investments made during 2021 and 2022 to address the implications of remote work and other digital transformation efforts combined with the caution exercised by companies in a very uncertain environment.”

While companies remain cautious, he reported technology revenue rose sequentially in the fourth quarter when adjusted for billing days. Fourth-quarter technology flex revenue rose 0.7% sequentially when adjusted for number of billing days.

In addition, secular demand for technology will ultimately continue to expand, necessitating people to implement it. Liberatore noted that “strategic uses of technology, including AI technologies, will continue to evolve and play an increasingly instrumental role in powering businesses.”

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Guidance

Kforce expects technology revenue to decline between 10% and 12% year over year in the first quarter, Dave Kelly, Kforce executive VP and chief operating officer, said in conference call with analysts. Finance/accounting revenue is forecast to be down by 25% year over year in the first quarter.

Kelly also said the company has seen an improvement in leading indicators over the past two weeks.

“This suggests we may see a more traditional pattern of growth in the number of technology consultants on assignment, albeit beginning slightly later in the quarter than usual,” he said.

Average bill rates remain near record levels at approximately $90 per hour, Kelly said.

Share price

Shares in Kforce were up 0.64% to $68.96 as of 12:07 p.m. Eastern time today. They set a new 52-week high today when they reached $73.37.