Mastech Digital Inc. (NYSEAMERICAN: MHH) reported third-quarter revenue rose 6.1% year over year to $63.2 million. The Pittsburgh-based IT staffing and services provider reported growth in its IT staffing segment despite some decline in staffing demand. However, revenue fell in the company's data and analytics services segment as bookings were light and new pipeline opportunities were below expectations.

Mastech also announced the resignation of Ganeshan Venkateshwaran, CEO of the company’s data and analytics services business segment, effective immediately. Vivek Gupta, Mastech president and CEO, will lead the segment until Venkateshwaran’s successor is in place.

“Both of our business segments came under a bit of stress during the quarter,” Gupta said. “Our data and analytics services segment was unable to fully deploy the second quarter ramp-up of billable resources, resulting in lower revenues and sub-par utilization. There was also a project cost over-run that impacted our gross margin performance in this segment.”

“Our IT staffing segment, on the other hand, delivered positive financial results in the third quarter, although we did experience some decline in staffing demand as we’ve seen customers controlling their staffing spend in anticipation of potential recessionary conditions,” Gupta said.

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Third-quarter GAAP net income was impacted by two pre-tax charges booked during the quarter which totaled $570,000. They included a cybersecurity breach of a single employee’s email account, for which Mastech reserved $450,000; Gupta said its investigation found the breach impacted only two clients, and the majority its pre-tax reserve was for cyber-security expertise expense to help with containment and compliance action steps.

Also, during the quarter, the company made a decision in the data and analytics services segment to close its underperforming operations in Singapore and Ireland and to rationalize its operating cost structure in the UK and reserved $120,000 of severance expense related to these actions.

Share price and market cap

Shares in Mastech were down 11.34% to $13.57 as of 11:52 a.m. Eastern time; they were 6.69% above the 52-week low, according to FT.com. The company had a market cap of $177.78 million.