Barrett Business Services (BBSI) Q2 2025 earnings summary

Executive summary

• Q2 2025 results exceeded plan, with revenue up 10% year-over-year to $307.7 million, driven by strong PEO growth, new client sales, expanded product adoption, and excellent client retention.

• Net income rose to $18.5 million ($0.70 per diluted share) from $16.7 million ($0.62 per diluted share) year-over-year.

• Average worksite employees (WSEs) grew 8% year-over-year, with a record 10,100 net new WSEs from new clients.

• Opened new branches in Chicago and Dallas, with plans for further expansion by year-end.

• Announced a new $100 million stock repurchase program effective August 4, 2025, replacing the prior authorization.

Financial highlights

• Gross billings increased 10.1% year-over-year to $2.23 billion in Q2 2025.

• PEO gross billings rose 10.3% to $2.22 billion; staffing revenues declined 11.5% to $17 million.

• Gross margin for Q2 2025 was $73.3 million (23.8% of revenue), up from $67.9 million in Q2 2024.

• SG&A expense increased 6% year-over-year, mainly due to higher employee-related costs and profit share incentives.

• Unrestricted cash and investments totaled $90.4 million as of June 30, 2025; the company remained debt free.

Outlook and guidance

• Raised full-year 2025 outlook: gross billings expected to increase 9–10%, WSEs to rise 6–8%.

• Gross margin as a percentage of gross billings guided to 2.9–3.05%; effective annual tax rate expected at 26–27%.

• Management expects continued quarterly fluctuations due to seasonality, wage limits, claims experience, and demand variability.