ManpowerGroup Inc. (MAN)

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations

in millions, except share and per share data

See the financial measures section on page 25 for further information on the Non-GAAP financial measures of constant currency and organic constant currency.

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended, (each a "forward-looking statement"). Statements made in this quarterly report that are not statements of historical fact are forward-looking statements. In addition, from time to time, we and our representatives may make statements that are forward-looking. Forward-looking statements are based on management’s current assumptions and expectations and are subject to risks and uncertainties that are beyond our control and may cause actual results to differ materially from those contained in the forward-looking statements. Forward-looking statements can be identified by words such as “expect,” “anticipate,” “intend,” “plan,” “may,” “believe,” “seek,” “estimate,” and other similar expressions. Important factors that could cause our actual results to differ materially from those contained in the forward-looking statements include, among others, the risk factors discussed in Item 1A – Risk Factors in our annual report on Form 10-K for the year-ended December 31, 2025, which information is incorporated herein by reference. Such risks and uncertainties include, but are not limited to, volatile, negative or uncertain economic conditions, particularly in Europe and the United States, including inflation, global trade policies, and geopolitical risk and uncertainty; changes in labor and tax legislation in places we do business; failure to implement strategic transformation initiatives and technology investments; and other factors that may be disclosed from time to time in our SEC filings or otherwise. We caution that any forward-looking statement reflects only our belief at the time the statement is made. We undertake no obligation to update any forward-looking statements to reflect subsequent events or circumstances.

Business Overview

Our business is cyclical in nature and is sensitive to macroeconomic conditions generally. Client demand for workforce solutions and services is dependent on the overall strength of the labor market and secular trends toward greater workforce flexibility within each of the segments where we operate. Improving economic growth typically results in increasing demand for labor, resulting in greater demand for our staffing services while demand for our outplacement services typically declines. During periods of decreased demand, our operating profit is generally impacted unfavorably as we experience a deleveraging of selling and administrative expenses, which may not decline at the same pace as revenues. By contrast, during periods of increased demand, we are generally able to improve our profitability and operating leverage as our cost base can support some increase in business without a similar increase in selling and administrative expenses.

In the first quarter of 2026, we saw continued stabilization of revenue trends across our key markets and delivered solid performance in Asia Pacific and Latin America and certain European markets including France and Italy. Employers remain deliberate in their workforce hiring strategies. Engagement levels are steady and activity levels are becoming more consistent with improving business confidence in the United States and rising manufacturing Purchasing Managers' Index in the United States and Europe. Although we are encouraged by signs of stabilization and ongoing strength in certain markets such as Asia Pacific, Latin America, and parts of Southern Europe, these trends reinforce our view that the shape of the recovery can be different by market with some inflecting earlier and others requiring longer periods of stabilization before inflecting.

During the first quarter of 2026, the United States dollar weakened on average, relative to the currencies in most of our markets, and overall had a favorable impact on our reported results compared to the first quarter of 2025. The changes in the foreign currency exchange rates had a 7.4% favorable impact on revenues from services. Substantially all of our subsidiaries derive revenues from services and incur expenses within the same local currency and generally do not have cross-currency transactions, and therefore, changes in foreign currency exchange rates primarily impact reported earnings and not our actual cash flow unless earnings are repatriated. To understand the performance of our underlying business, we utilize constant currency or organic constant currency variances for our consolidated and segment results.

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PART 1

During the first quarter of 2026 compared to the first quarter of 2025, we experienced a 5.6% revenue increase in the Americas, primarily driven by an increase in demand for our Manpower staffing services and the favorable impact of currency exchange rates, partially offset by a decrease in demand for our Experis interim services. During the first quarter of 2026 compared to the first quarter of 2025, we experienced a 14.6% revenue increase in Southern Europe, primarily due to the favorable impact of currency exchange rates and the increased demand for Manpower staffing services, partially offset by decreased demand in outcome-based solutions. During the first quarter of 2026 compared to the first quarter of 2025, we experienced an 8.1% revenue increase in Northern Europe, primarily due to the favorable impact of currency exchange rates and an increase in demand for our Manpower staffing services, partially offset by a decrease in demand for our Experis interim services. We experienced a 7.1% revenue increase in APME in the first quarter of 2026 compared to the first quarter of 2025 primarily due to an increase in demand for our Manpower staffing services and an increase in demand for our Experis interim services, partially offset by the unfavorable impact of currency exchange rates.

From a brand perspective, we experienced a revenue increase in Manpower and Talent Solutions while Experis experienced a revenue decrease in the first quarter of 2026 compared to the first quarter of 2025. In our Manpower brand, the revenue increase was primarily due to increased demand for staffing services and Manpower consulting services. The revenue increase in our Talent Solutions brand, which includes RPO, MSP and our Right Management offerings, was primarily due to currency, an increase in demand for our Right Management outplacement services, partially offset by decreased demand for our permanent recruitment services. The revenue decrease in our Experis brand was primarily due to decreased demand in our interim services, permanent recruitment services, and outcome-based solutions services.

In the first quarter of 2026, our gross profit margin decreased 110 basis points compared to the first quarter of 2025, primarily attributable to decreases in our staffing and interim margins due to business mix changes driven by enterprise clients, lower bench utilization, and lower permanent recruitment and other services activity.

Our operating profit increased 0.5% in the first quarter of 2026 and our operating profit margin decreased 10 basis points compared to the first quarter of 2025. Operating profit margin decreased in the first quarter of 2026 primarily due to the increase in selling and administrative expenses driven by the strategic transformation program costs related to our global transformation initiative.

Operating Results - Three Months Ended March 31, 2026 and 2025

The following table presents selected consolidated financial data for the three months ended March 31, 2026 as compared to 2025.

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PART 1

The year-over-year increase in revenues from services was 10.3% (2.9% in constant currency) primarily attributed to:

•
a revenue increase in the Americas of 5.6% (3.5% in constant currency) primarily driven by a $77.9 increase in demand for our Manpower staffing services and a $21.7 favorable impact of currency exchange rates, partially offset by a $51.9 decrease in demand for our Experis interim services. The United States, our largest market in the Americas, experienced a revenue decrease of -4.9% primarily driven by a $52.4 decrease in demand for our Experis interim services, partially offset by a $12.7 increase in demand for our Manpower staffing services. The revenue decrease in the United States was offset by our Other America countries, which experienced a revenue increase of $71.2 primarily due to a $65.3 increase in demand for our Manpower staffing services.

•
a revenue increase in Southern Europe of 14.6% (3.0% in constant currency) primarily driven by a $212.0 favorable impact of currency exchange rates and a $57.5 increase in demand for our Manpower staffing services, partially offset by a $5.5 decrease in demand for outcome-based solutions. France, the largest market in Southern Europe, experienced a revenue increase of 10.7% (-0.3% decrease in constant currency) primarily driven by a $106.1 favorable impact of currency exchange rates, partially offset by a $4.5 decrease in demand for outcome-based solutions. Italy, our second-largest market in Southern Europe, experienced a revenue increase of 19.3% (7.5% in constant currency) primarily driven by the $47.0 favorable impact of currency exchange rates and a $27.3 increase in demand for our Manpower staffing services. Other Southern Europe countries experienced a revenue increase of 18.6% (6.1% in constant currency) primarily driven by the $58.9 favorable impact of currency exchange rates and a $26.8 increase in demand for our Manpower staffing services;

•
a revenue increase in Northern Europe of 8.1% (-1.8% decrease in constant currency) primarily driven by the $72.4 favorable impact of currency exchange rates and a $19.0 increase in demand for our Manpower staffing services, partially offset by a $20.6 decrease in demand for our Experis interim services. Within our Northern Europe segment, we experienced revenue increases in the Nordics of $19.8, the United Kingdom of $11.9, Belgium of $6.0, and the Netherlands of $4.5 which represented revenue increases of 14.2%, 4.7%, 8.7%, and 5.3%, respectively (the Nordics were flat, and decreases of -2.0%, -2.2%, and -5.2%, respectively, in constant currency). This w

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Management’s Discussion and Analysis of Financial Condition and Results of Operations

in millions, except share and per share data

Financial Measures — Constant Currency And Organic Constant Currency

Changes in our financial results include the impact of changes in foreign currency exchange rates, acquisitions and dispositions. We provide “constant currency” and “organic constant currency” calculations in this report to remove the impact of these items. We express year-over-year variances that are calculated in constant currency and organic constant currency as a percentage.

When we use the term “constant currency,” it means that we have translated financial data for a period into United States dollars using the same foreign currency exchange rates that we used to translate financial data for the previous period. We believe that this calculation is a useful measure, indicating the actual growth of our operations. We use constant currency results in our analysis of subsidiary or segment performance, including Argentina which operates in a hyperinflationary economy. We also use constant currency when analyzing our performance against that of our competitors. Substantially all of our subsidiaries derive revenues and incur expenses within a single country and, consequently, do not generally incur currency risks in connection with the conduct of their normal business operations. Changes in foreign currency exchange rates primarily impact reported earnings and not our actual cash flow unless earnings are repatriated.

When we use the term “organic constant currency,” it means that we have further removed the impact of acquisitions in the current period and dispositions from the prior period from our constant currency calculation. We believe that this calculation is useful because it allows us to show the actual growth of our ongoing business.

The constant currency and organic constant currency financial measures are used to supplement those measures that are in accordance with United States Generally Accepted Accounting Principles (“GAAP”). These Non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in our industry, as other companies may calculate such financial results differently. These Non-GAAP financial measures are not measurements of financial performance under GAAP, and should not be considered as alternatives to measures presented in accordance with GAAP.

Constant currency and organic constant currency percent variances, along with a reconciliation of these amounts to certain of our reported results, are included in the Financial Measures section found in Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations."

Results of Operations - For Years of Operation Ending December 31, 2025 and 2024

The financial discussion that follows focuses on 2025 results compared to 2024. For a discussion of 2024 results compared to 2023, see the company’s Annual Report on Form 10-K for the year ended December 31, 2024.

During 2025, reported revenues increased 0.6% compared to 2024. After a volatile start to 2025, reflecting macroeconomic and geopolitical uncertainties, including the impact of policy shifts and global trade dynamics, we have seen improved trends in the second half of 2025. We observed the continuation of largely stable activity levels across North America and Europe overall, with improving trends in France, despite ongoing political and budget uncertainty. Latin America and Asia Pacific continued to experience good demand. Employers remain deliberate in their workforce hiring strategies, yet engagement levels are steady and activity levels are becoming more consistent. We are seeing clear sequential improvement in key demand indicators, including Manpower associates on assignment in key markets including the United States and France. Although we are encouraged by signs of stabilization and signs of inflection in certain markets such as Italy and Spain, these trends reinforce our view that the shape of the recovery can be different by market with some inflecting earlier and others requiring longer periods of stabilization before inflecting.

Throughout 2025, the United States dollar weakened, on average, relative to the currencies in most of our markets, and overall had a favorable impact on our reported results. The changes in the foreign currency exchange rates had a 2.7% favorable impact on revenues from services. Substantially all of our subsidiaries derive revenues from services and incur expenses within the same local currency and generally do not have cross-currency transactions, and therefore, changes in foreign currency exchange rates primarily impact reported earnings and not our actual cash flow unless earnings are repatriated. To understand the performance of our underlying business, we utilize constant currency or organic constant currency variances for our consolidated and segment results.

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Part II

During 2025, we experienced the following quarterly changes to our consolidated revenues compared to 2024: a -7.1% decrease (-4.6% in constant currency and -2.4% in organic constant currency) in revenue in the first quarter due to decreased demand in our Manpower staffing business and softening demand in our Experis interim business; revenue stayed flat (-3.5% in constant currency and -1.4% in organic constant currency) in the second quarter due to an increase in demand for our Manpower staffing business offset by decreased demand in our Experis interim business; a revenue increase of 2.3% (a decrease of -1.5% in constant currency and an increase of 0.7% in organic constant currency) in the third quarter due to an increase in demand for our Manpower staffing business and decreased demand in our Experis interim business; and ending the year with a 7.1% (1.3% in constant currency and 2.2% in organic constant currency) revenue increase in the fourth quarter of 2025 due to the increase in demand for our Manpower staffing services.

During 2025 compared to 2024, most of our markets experienced increased revenues due to currency exchange rates partially offset by softening demand for our staffing, interim and permanent recruitment services. We experienced a 2.9% revenue increase in the Americas primarily driven by an increase in demand for our Manpower staffing services, an increase in demand for our Talent Based Outsourcing (TBO) business and an increase in demand for our Right Management outplacement services, partially offset by a decrease in demand for our Experis interim services and the unfavorable impact of currency exchange rates. We experienced a 2.7% revenue increase in Southern Europe, primarily driven by the favorable impact of currency exchange rates, partially offset by a decrease in demand for our Manpower staffing and Experis interim services and a decrease in demand for our permanent recruitment services. We experienced a revenue decrease of -4.3% in Northern Europe, primarily due to decreased demand in our Manpower staffing and Experis interim services and decreased demand in our permanent recruitment business, partially offset by the favorable impact of currency exchange rates. We experienced a -5.5% revenue decrease in APME driven by the disposition of our South Korea business, partially offset by an increase in demand for our Manpower staffing services, the favorable impact of currency exchange rates, and an increase in demand for our Experis interim services.

From a brand perspective, we experienced a revenue increase in Manpower, partially offset by revenue decreases in our Experis and Talent Solutions brands during 2025 compared to 2024. The revenue increase in our Manpower brand was due to the favorable impact of currency exchange rates, partially offset by decreased demand for our outcome based services and permanent placement business. In our Experis brand, the revenue decrease was primarily due to decreased demand for our interim services, decreased demand for our Experis consulting business, and decreased demand for our Experis permanent placement services. The revenue decrease in our Talent Solutions brand, which includes Recruitment Process Outsourcing (RPO), TAPFIN - MSP, and our Right Management offerings, was driven primarily by decreased activity in our RPO permanent recruitment business, and decreased demand for our Right Management outplacement services.

In 2025 our gross profit margin decreased 60 basis points compared to 2024 primarily due to decreases in our permanent recruitment business, including Talent Solutions RPO, as permanent hiring demand continued to soften and experienced reduced levels from the prior year period. Also, we experienced a decrease in staffing and interim margins due to mix shifts towards enterprise accounts.

In 2025 our operating profit decreased -50.9% while our operating profit margin decreased 90 basis points compared to 2024. The operating profit margin decreased primarily due to the overall decrease in our gross profit margin as well as an increase in selling and administrative expenses due to increased goodwill and intangible asset impairments, corporate expense, and restructuring.

During the year, we initiated significant restructuring actions on businesses heavily impacted by the continuing economic uncertainty. With these actions, we expect our overall cost structure to decline. We expect to continue to monitor expenses closely to maintain the benefit of our efforts to optimize our organizational cost structures. At the same time, we plan to invest appropriately to enable the business to grow in the future and enhance our productivity, technology and digital capabilities. We are focused on managing costs as efficiently as possible in the short term while continuing to progress transformational actions aligned with our strategic priorities.

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Consolidated Results - 2025 compared to 2024

The following table presents selected consolidated financial data for 2025 as compared to 2024.

The year-over-year increase in revenues from services of 0.6% (-2.1% in constant currency and -0.2% in organic constant currency) was attributed to:

•
a revenue increase in the Americas of 2.9% (increase of 4.4% in constant currency) primarily driven by a $292.1 increase in demand for our Manpower staffing services, a $14.6 increase in demand for TBO, partially offset by a $133.5 decrease in demand for our Experis interim services and the $60.9 unfavorable impact of currency exchange rates. The United States, our largest market in the Americas, experienced a revenue decrease of -1.1% primarily driven by a $117.4 decrease in demand for our Experis interim services and a $16.1 decrease in demand for our permanent recruitment services, partially offset by a $75.0 increase in our Manpower staffing services;

•
a revenue increase in Southern Europe of 2.7% (-2.0% in constant currency and -1.5% in organic constant currency) primarily driven by a $386.0 favorable impact due to currency exchange rates and a $17.4 increase in demand for our consulting services, partially offset by a $142.9 decrease in demand for our Manpower staffing services, a $27.5 decrease in demand for our outcome based solutions and an $8.6 decrease in demand for our permanent recruitment services. France, the largest market in Southern Europe, experienced a revenue decrease of -1.6% (-5.9% in constant currency) primarily driven by a $250.1 decrease in demand for our Manpower staffing services, partially offset by a $197.4 favorable impact from currency exchange rates. Italy, our second-largest market in Southern Europe, experienced a revenue increase of 8.6% (3.8% in constant currency) primarily driven by an $80.5 favorable impact in currency exchange rates, a $61.0 increase in demand for our Manpower staffing services and an $11.4 increase in demand for our consulting business;

•
a revenue decrease in Northern Europe of -4.3% (-8.3% in constant currency and -8.1% in organic constant currency), primarily due to decreased demand of $112.0 for our Experis interim services, an $85.5 decrease in demand for our Manpower staffing services, a $25.2 decrease in demand in our permanent recruitment business, and a $19.2 decrease in demand in our consulting business, partially offset by the $132.4 favorable impact of currency exchange rates. Within our Northern Europe segment, we experienced revenue decreases in the United Kingdom of $101.5, Germany of $97.2, the Nordics of $12.8, Netherlands of $2.3 and an increase in Belgium of $27.0, which represented revenue decreases of -8.9%, -20.4%, -2.0%, and -0.6% and an increase of 8.7%, respectively (-11.7%, -23.7%, -7.0%, and -4.9% and an increase of 3.7%, respectively, in constant currency); and

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•
a revenue decrease in APME of -5.5% (-6.3% in constant currency and an increase of 7.4% in organic constant currency) primarily driven by the disposition and franchising of our South Korea business in 2024. Offsetting the disposition was an increase in demand of $122.9 in our Manpower staffing business, a $17.3 favorable impact of currency exchange rates, and an increase in demand of $8.3 in our Experis interim service.

The year-over-year 60 basis point decrease in gross profit margin was primarily attributed to:

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a 25 basis point unfavorable impact due to decreases in permanent recruitment, including Talent Solutions RPO, as permanent hiring demand continued to soften and experienced reduced levels from the prior year period;

•
a 25 basis point unfavorable impact from the decrease in staffing and interim margins due to mix shifts towards enterprise clients; and

•
a 10 basis point unfavorable impact from decreased career transition activity in Right Management as outplacement activity increased.

The 2.4% increase in selling and administrative expenses in the year ended December 31, 2025 (0.1% in constant currency and 1.1% in organic constant currency) was primarily attributed to:

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an $88.7 increase in goodwill and other impairment charges as no impairment was recorded in 2024;

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a $63.5 increase due to the impact of changes in currency exchange rates;

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a $38.6 increase in corporate expense due to incremental investments in our transformation initiatives, one-time benefits in 2024 related to the disposition and franchising of our South Korea business and the release of a healthcare reserve; and

•
restructuring costs of $64.2 in 2025 compared to $53.6 incurred in 2024; partially offset by

•
a $69.9 decrease, (-1.8% reported, -3.9% in constant currency, and -2.9% in organic constant currency) in personnel costs primarily due to a $41.2 decrease in salary costs and a $23.8 decrease in bonuses & sales commissions; and

•
a $45.0 decrease, (-3.9% reported, -4.4% in constant currency, and -4.5% in organic constant currency) in non-personnel costs, primarily due to a $20.8 decrease in office lease and other office costs, an $8.8 decrease in consulting and outside services costs, and a $4.7 decrease in travel and entertainment cost.

Selling and administrative expenses as a percentage of revenues increased 30 basis points in the year ended December 31, 2025 compared to the year ended December 31, 2024 due primarily to:

•
a 50 basis point unfavorable impact due to goodwill and other impairment charges;

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a 30 basis point unfavorable impact due to increase corporate expense;

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a 20 basis point favorable impact due to lower personnel costs;

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a 20 basis point favorable impact as a result of lower lease and office related costs; and

•
a 10 basis point favorable impact due to currency exchange rates.

Interest and other expenses, net is comprised of interest, foreign exchange gains and losses and other miscellaneous non-operating income and expenses, including those associated with noncontrolling interests. Interest expense, net was $67.6 in 2025 compared to $56.7 in 2024 resulting from increased short term borrowings in 2025 compared to 2024. Foreign exchange loss, net was $6.5 in 2025 compared to $6.2 in 2024. Miscellaneous income, net was $17.4 in 2025 compared to $13.7 in 2024.

We recorded income tax expense at an effective rate of 114.2% for 2025, as compared to an effective rate of 43.5% for 2024. The 2025 rate was unfavorably impacted by the goodwill and indefinite-lived intangible asset impairment charges recorded in Switzerland and the United Kingdom. The 2025 rate was also unfavorably impacted by the lower level and overall mix of earnings due in part to restructuring costs recorded and the 2025 enacted French exceptional corporate income tax surcharge. The 114.2% effective tax rate for 2025 was higher than the United States Federal statutory rate of 21% primarily due to the factors noted above as well as tax losses in certain countries for which we did not recognize a corresponding tax benefit due to valuation allowances and the French business tax.

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Net loss per share - diluted was $0.29 in 2025 compared to net earnings per share - diluted of $3.01 in 2024. Goodwill and other impairment charges recorded in 2025 negatively impacted net earnings per share - diluted by approximately $1.78 per share, net of tax. Restructuring costs recorded in 2025 and 2024 negatively impacted net earnings per share - diluted by approximately $1.16 and $1.10 per share, net of tax, in 2025 and 2024, respectively. The loss from the disposition of subsidiaries recorded in the of 2025 and other items unfavorably impacted net earnings per share - diluted by approximately $0.26, net of tax. The pension settlement expense recorded in 2025 and 2024 negatively impacted net earnings per share - diluted by approximately $0.04 and $0.08, net of tax, in 2025 and 2024, respectively.

Weighted average shares - diluted decreased to 46.6 million in 2025 from 47.7 million in 2024. This decrease was due to the impact of share repurchases completed in 2025, partially offset by grants of share-based awards.

Segment Results

We evaluate performance based on operating unit profit (“OUP”), which is equal to segment revenues less direct costs and branch and national headquarters operating costs. This profit measure does not include goodwill and intangible asset impairment charges or amortization of intangible assets related to acquisitions, corporate expenses, interest and other income and expense amounts or income taxes.

Americas

In the Americas, revenues from services increased 2.9% (4.4% in constant currency) in 2025 compared to 2024. In the United States, revenues from services decreased -1.1% in 2025 compared to 2024, primarily driven by a $117.4 decrease in demand for our Experis interim services and a $16.1 decrease in demand for our permanent recruitment services, partially offset by a $75.0 increase in demand for our Manpower staffing services. In Other Americas, revenues from services increased 10.6% (14.8% in constant currency) in 2025 compared to 2024 primarily driven by a $217.1 increase in demand for our Manpower staffing service and a $14.6 increase in demand for our TBO business, partially offset by the $60.9 unfavorable impact of foreign currency exchange rates and a $16.1 decrease in demand for our Experis interim service. The constant currency increase in Other Americas was primarily driven by the inflation in Argentina. Within our Other Americas segment, we experienced increases in Chile, Colombia, Peru, and Argentina of $49.9, $39.9, $30.9, and $11.8, or 37.2%, 25.4%, 24.8%, and 9.4%, respectively (37.9%, 23.9%, 18.3%, and 47.5%, respectively, in constant currency), partially offset by a revenue decrease in Canada of $15.9, or -5.1% (-3.3% in constant currency).

Gross profit margin decreased 140 basis points in 2025 compared to 2024. This decrease was primarily due to decreased demand in our Experis interim services, which contributed 110 basis points to the decrease and decreased demand in our Talent Solutions business, which contributed 40 basis points to the decrease. These decreases were partially offset by increased margins in our training business, which had a 10 basis point impact.

Selling and administrative expenses decreased -3.2% (-2.1% in constant currency) in 2025 compared to 2024, primarily driven by the $11.9 decrease in non-personnel costs and the $8.5 favorable impact of currency exchange rates.

OUP decreased -3.3% (-2.6% in constant currency) in 2025, which represents a 3.1% OUP margin, a decrease from 3.4% in 2024. This decrease was primarily due to decreased profitability in our United States business of $11.7, which experienced decreased activity in our Experis interim business and decreased activity in our higher-margin permanent recruitment business, partially offset by a decrease in our selling and administrative expenses as a percentage of revenue. In the United States, OUP margin decreased to 2.4% in 2025 from 2.8% in 2024 primarily due to decreased activity in our Experis interim business and decreased activity in our higher-margin permanent recruitment business, partially offset by a decrease in our selling and administrative expenses as a percentage of revenue. Other Americas OUP margin remained flat at 4.4% in 2025 compared to 2024.

Southern Europe

In Southern Europe, revenues from services increased 2.7% (-2.0% in constant currency and -1.5% in organic constant currency) in 2025 compared to 2024. In France, revenues from services decreased -1.6% (-5.9% in constant currency) in 2025 compared to 2024, primarily driven by a $250.1 decrease in demand for our Manpower staffing services, partially offset by a $197.4 increase due to the favorable impact of currency exchange rates. In Italy, revenues from services increased 8.6% (3.8% in constant currency) in 2025 compared to 2024, primarily driven by an $80.5 impact due to the favorable impact of currency exchange rates, a $61.0 increase in demand for our Manpower staffing services and an $11.4 increase in demand for our consulting business. In Other Southern Europe, revenues from services increased 7.2% (1.8% in constant currency and 4.3% in organic constant currency) in 2025 compared to 2024, primarily driven by the $108.1 favorable impact of currency exchange rates and a $46.2 increase in demand for our Manpower staffing services, partially offset by a $17.0 decrease in demand in our TBO business. Within our Other Southern Europe segment, we experienced revenue increases in Spain and Israel of $95.3 and $64.6, or 18.5% and 18.0%, respectively (13.0% and 9.7%, respectively, in constant currency), partially offset by a revenue decrease in Switzerland of $28.0, or -6.5% (-12.1% in constant currency).

Gross profit margin decreased 40 basis points in 2025 compared to 2024. This decrease was primarily due to increased activity in our lower margin Manpower staffing services, which contributed 30 basis points to the decrease and a decrease across our permanent placement business, which contributed 10 basis points to the decrease.

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Selling and administrative expenses, excluding impairment charges, increased 4.8% (0.1% in constant currency and 0.8% in organic constant currency) during 2025 compared to 2024 primarily due to the unfavorable impact of currency exchange rates of $41.7, $8.2 increase in restructuring costs, and $5.2 increase in consulting and outside services, partially offset by a $15.7 decrease in salary-related costs as a result of restructuring actions taken in prior years.

OUP decreased -14.3% (-18.4% in constant currency and -18.8% in organic constant currency) in 2025, which represents a 3.1% OUP margin, a decrease from 3.7% in 2024. This OUP decrease was primarily due to decreased profitability in the France reporting unit of $39.7. In France, the OUP margin decreased to 2.5% in 2025 compared to 3.3% in 2024 primarily driven by an increase in lower margin staffing demand and a decrease in our higher-margin permanent recruitment business. In Italy, the OUP margin decreased to 6.4% in 2025 from 6.7% in 2024 primarily driven by increased demand in our lower margin staffing business. In Other Southern Europe, the OUP margin decreased to 1.6% in 2025 from 2.1% in 2024 primarily due to a decrease in gross profit margin driven by softer permanent recruitment demand.

Northern Europe

In Northern Europe, the largest country operations include the United Kingdom, the Nordics, Germany, the Netherlands and Belgium (comprising 33%, 19%, 12%, 12% and 11%, respectively). In the Northern Europe region, revenues from services decreased -4.3% (-8.3% in constant currency and -8.1% in organic constant currency) in 2025 compared to 2024, primarily due to a decrease in demand of $112.0 for our Experis interim service, an $85.5 decrease in demand for our Manpower staffing service, a decrease in demand of $25.2 in our permanent recruitment business and a decrease in demand of $19.2 in our consulting business, partially offset by the $132.4 favorable impact of currency exchange rates. Within our Northern Europe segment, we experienced revenue decreases in the United Kingdom of $101.5, Germany of $97.2, the Nordics of $12.8, and Netherlands of $ $2.3, and an increase in Belgium of $27.0, which represented revenue decreases of -8.9%, -20.4%, -2.0%, and -0.6% and an increase of 8.7%, respectively (decreases of -11.7%, -23.7%, -7.0%, and -4.9% and an increase of 3.7%, respectively, in constant currency).

Gross profit margin decreased by 90 basis points in 2025 compared to 2024 primarily due to decreased activity in our Talent Solutions brand, which contributed 50 basis points to the decrease and decreased activity in our Experis brand, which contributed 40 basis points to the decrease.

Selling and administrative expenses, excluding impairment charges, decreased -9.0% (-12.8% in constant currency and -12.7% in organic constant currency) in 2025 compared to 2024. The decrease is primarily driven by a $59.0 decrease in personnel costs as we experience the impacts of significant restructuring actions taken in 2025 and 2024 and a $15.1 decrease in office and lease related costs incurred in 2025 compared to 2024, partially offset by an increase of $23.8 due to currency exchange rates.

Operating unit loss in Northern Europe improved 2.9% (7.5% in constant currency and 8.4% in organic constant currency) in 2025, which represents a -1.4% OUP margin, a decrease from -1.3% in 2024. The lower operating unit loss was primarily driven by an increase in profitability in Germany and the Nordics, which experienced profitability increases of $7.7 and $6.0, respectively, partially offset by an OUP decrease in the United Kingdom of $22.3.

APME

Revenues from services decreased -5.5% (-6.3% in constant currency and an increase of 7.4% in organic constant currency) in 2025 compared to 2024. In Japan, revenues from services increased 7.3% (5.9% in constant currency) primarily driven by a $50.1 increase in demand for our Manpower staffing services, a $15.7 favorable impact of currency exchange rates, and an $8.3 increase in demand for our Experis interim services.

Gross profit margin increased 90 basis points in 2025 compared to 2024 primarily due to the South Korea disposition in 2024.

Selling and administrative expenses decreased -6.8% (-7.5% in constant currency and increased 0.4% in organic constant currency) in 2025 compared to 2024. The decrease is primarily driven by the $19.8 decrease in non-personnel costs due to the South Korea Disposition.

OUP in APME increased 20.4% (19.1% in constant currency and 28.7% in organic constant currency), in 2025, which represents a 4.9% OUP margin, an increase from 3.9% in 2024. This OUP increase was primarily driven by increased margins in our Manpower staffing and Experis interim services and a decrease in selling and administrative expenses.

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Financial Measures

Constant Currency And Organic Constant Currency Reconciliation

Certain constant currency and organic constant currency percent variances are discussed throughout this report. A reconciliation of these Non-GAAP percent variances to the percent variances calculated based on our annual GAAP financial results is provided below. (See Financial Measures - Constant Currency and Organic Constant Currency on page 32 for information.)

Cash Sources and Uses

Cash used to fund our operations is primarily generated through operating activities and provided by our existing credit facilities. We believe our available cash and existing credit facilities are sufficient to cover our cash needs for the foreseeable future. We assess and monitor our liquidity and capital resources globally. We use a global cash pooling arrangement, intercompany lending, and some local credit lines to meet funding needs and allocate our capital resources among our various entities. As of December 31, 2025, we had $236.1 of cash held by foreign subsidiaries. We have historically made and anticipate future cash repatriations to the United States from certain foreign subsidiaries to fund corporate activities. As of December 31, 2025, deferred taxes related to non-United States withholding and other taxes were provided on $1,662.1 of accumulated unremitted earnings of non-United States subsidiaries that may be remitted to the United States. As of December 31, 2025 and 2024, we have recorded a deferred tax liability of $28.2 and $25.9, respectively, related to these non-United States earnings that may be remitted. As of December 31, 2025, we had an additional $372.0 of accumulated unremitted earnings of non-United States subsidiaries for which we have not provided deferred taxes as amounts are deemed indefinitely reinvested. We have not estimated the deferred tax liability on these earnings as such estimation is not practicable to determine or immaterial to the financial statements.

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Our principal ongoing cash needs are to finance working capital, capital expenditures, debt payments, interest expense, dividends, share repurchases and acquisitions. Working capital is primarily in the form of trade receivables, which generally increase as revenues increase. The amount of financing necessary to support revenue growth depends on receivables turnover, which differs in each market where we operate.

Cash used in operating activities was $104.1 in 2025, as compared to $309.2 generated in 2024. Changes in operating assets and liabilities utilized $269.3 of cash in 2025, compared to $65.4 generated in 2024. These changes were primarily attributable to the timing of collections and payments, as well as an increase in capitalized implementation costs related to our cloud computing arrangements.

Accounts receivable increased to $4,770.3 as of December 31, 2025 from $4,297.2 as of December 31, 2024. The increase was partly attributable to the impact of changes in currency exchange rates. DSO increased by approximately three days from December 31, 2024 to 55 days as of December 31, 2025 due to unfavorable mix changes, with higher growth in countries with a higher average DSO.

Cash used in investing activities were $59.2 and $68.2 for 2025 and 2024, respectively. Capital expenditures were $57.3 and $51.1 during 2025 and 2024, respectively. These expenditures were comprised of purchases of computer equipment, office furniture and other costs related to office openings and refurbishments, as well as capitalized software costs of $17.9 and $10.1 in 2025 and 2024, respectively.

Cash provided by financing activities was $485.5 in 2025 compared to $282.4 used in 2024. Net debt borrowings were $586.1 in 2025 as compared to net debt borrowings of $16.1 in 2024. The larger borrowings in 2025 were due to the issuance of €500.0 notes in December 2025 which were used to redeem our 2018 notes in January 2026.

The Board of Directors authorized the repurchase of 5.0 million and 4.0 million shares of our common stock in August 2023 and August 2021, respectively. Share repurchases may be made from time to time through a variety of methods, including open market purchases, block transactions, privately negotiated transactions or similar facilities. In 2025, we repurchased a total of 0.7 million shares under the 2023 authorization, at a total cost of $37.5 including excise tax on share repurchases of $0.5. In 2024, we repurchased a total of 2.0 million shares under the 2023 authorization, at a total cost of $140.9 including excise tax on share repurchases of $0.9. As of December 31, 2025, there were 1.9 million shares remaining authorized for repurchase under the 2023 authorization.

During 2025 and 2024, the Board of Directors declared total cash dividends of $1.44 and $3.08 per share, respectively, resulting in total dividend payments of $66.7 and $145.8, respectively.

As of December 31, 2025, we had aggregate commitments of $3.130.9 related to debt, operating leases, purchase obligations for global technology and financial shared services, and restructuring costs, as follows:

(a)
Includes €500.0 notes redeemed in January 2026.

(b)
Includes local information technology contracts and other vendor commitments.

Our liability for unrecognized tax benefits, including related interest and penalties, of $15.6 is excluded from the commitments above as we cannot determine the years in which these positions might ultimately be settled.

We recorded net restructuring costs of $64.2 and $53.6 in 2025 and 2024, respectively, in selling and administrative expenses, primarily related to severance, office closures and consolidations, and professional and other fees related to restructuring in multiple countries and territories. The costs paid out of our restructuring reserve were $72.9 in 2025.

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We have entered into guarantee contracts and stand-by letters of credit that total $626.1 as of December 31, 2025 ($582.3 for guarantees and $43.8 for stand-by letters of credit). The guarantees primarily relate to staffing license requirements, operating leases and indebtedness. The stand-by letters of credit mainly relate to workers’ compensation in the United States. If certain conditions were met under these arrangements, we would be required to satisfy our obligation in cash. Due to the nature of these arrangements and our historical experience, we do not expect to make any significant payments under these arrangements. Therefore, they have been excluded from our aggregate commitments identified above. The cost of these guarantees and letters of credit was $1.7 for 2025.

Total capitalization as of December 31, 2025 was $3,737.4, comprised of $1,677.1 in debt and $2,060.3 in equity. Debt as a percentage of total capitalization was 45% and 31% as of December 31, 2025 and 2024, respectively. The higher debt percentage in 2025 was due to the issuance of €500.0 notes in December 2025, which were used to redeem our 2018 notes in January 2026.

Acquisitions

From time to time, we acquire and invest in companies throughout the world, including franchises. The total cash consideration paid for acquisitions, net of cash acquired, for the years ended December 31, 2025 and 2024 was $2.3 and $7.7, respectively. The 2025 payments mainly represent a contingent consideration payment related to a previous acquisition. The 2024 payments represent a consideration payment for a franchise in the United States and contingent consideration payments related to a previous acquisition.

As of December 31, 2025, goodwill and other intangible assets resulting from the 2025 acquisitions were $0.9 and $0.0, respectively. As of December 31, 2024, goodwill and other intangible assets resulting from the 2024 acquisitions were $1.4 and $3.1, respectively.

Dispositions

Occasionally, we dispose of parts of our operations based on risk considerations and to optimize our global strategic and geographic footprint as well as improve our overall efficiency. On May 31, 2025, we disposed of our New Caledonia business in our APME segment and simultaneously entered into a franchise agreement. In connection with this transaction, we recognized a one-time net loss on disposition of $1.4, of which $0.2 was included in selling and administrative expenses and $1.2 was included in interest and other expenses in the Consolidated Statements of Operations in the year ended December 31, 2025.

On May 30, 2025, we disposed of our South Africa business in our Northern Europe segment in exchange for a non-interest-bearing loan receivable of $1.4 and simultaneously entered into a franchising agreement. We recognized a one-time net loss on disposition of $4.8, of which $2.2 was included in selling and administrative expenses and $2.6 was included in interest and other expenses in the Consolidated Statements of Operations in the year ended December 31, 2025.

On November 1, 2024, we disposed of our South Korea business in our APME segment for cash proceeds of $20.6 and simultaneously entered into a franchising agreement under which the new ownership will operate Manpower Korea under the Manpower brand. In connection with the disposition, we recognized a one-time net loss on disposition of $0.4, consisting of a $3.3 gain in selling and administrative expenses and a $3.7 loss in interest and other expenses in the Consolidated Statements of Operations in the year ended December 31, 2024. The franchise arrangement represents a significant component of the transaction. Our South Korea business contributed $349.9 of revenues for the year ended December 31, 2023.

On October 15, 2024, we disposed of our Austria business in our Southern Europe segment for cash proceeds of $0.1 and simultaneously entered into a franchising agreement. In connection with the disposition, we recognized a one-time net loss on disposition of $7.7, of which $4.9 was included in selling and administrative expenses and $2.8 was included in interest and other expenses in the Consolidated Statements of Operations in the year ended December 31, 2024.

Euro Notes

On December 15, 2025, we offered and sold €500.0 aggregate principal amount of the Company’s 3.750% notes due December 2030 (the “2025 €500.0 notes”). The net proceeds from the 2025 €500.0 notes of €497.4 were used in January 2026 to redeem our 2018 €500.0 notes due June 22, 2026. The 2025 €500.0 notes were issued at a price of 99.839% to yield an effective interest rate of 3.786%. Interest on the 2025 €500.0 notes is payable in arrears on December 13 of each year. The 2025 €500.0 notes are unsecured senior obligations and rank equally with all of the Company’s existing and future senior unsecured debt and other liabilities.

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On June 30, 2022, we offered and sold €400.0 aggregate principal amount of the Company’s 3.50% notes due June 30, 2027 (the “2022 €400.0 notes”). The proceeds from the 2022 €400.0 notes were used in July 2022 to redeem our €400.0 1.875% notes due September 11, 2022. The 2022 €400.0 notes were issued at a price of 99.465% to yield an effective interest rate of 3.514%, net of a favorable impact of a forward starting interest rate swap. Interest on the 2022 €400.0 notes is payable in arrears on June 30 of each year. The Notes are unsecured senior obligations and rank equally with all of the Company’s existing and future senior unsecured debt and other liabilities.

On June 22, 2018, we offered and sold €500.0 aggregate principal amount of the Company’s 1.750% notes due June 2026 (the “2018 €500.0 notes”). The net proceeds from the 2018 €500.0 notes of €495.7 were used to redeem our €350.0 notes due June 22, 2018, with the remaining balance used for general corporate purposes, which included share repurchases. The 2018 €500.0 notes were issued at a price of 99.564% to yield an effective interest rate of 1.809%. We redeemed those notes in January 2026 using the proceeds from the 2025 €500.0 notes.

Both the 2018 €500.0 notes and 2022 €400.0 notes contain certain customary non-financial restrictive covenants and events of default and are unsecured senior obligations and rank equally with all of our existing and future senior unsecured debt and other liabilities. These notes have been designated as a hedge of our net investment in subsidiaries with a Euro-functional currency as of December 31, 2025. Since our net investment in these subsidiaries exceeds the respective amount of the designated borrowings, the related translation gains or losses are included as a component of accumulated other comprehensive loss ("AOCL"). (See the Significant Matters Affecting Results of Operations section and Notes 8 and 12 to the Consolidated Financial Statements found in Item 8. "Financial Statements and Supplementary Data" for further information.)

Revolving Credit Agreement

On December 15, 2025, we entered into a new $600.0 five-year Credit Agreement (the “Credit Agreement”) with a syndicate of commercial banks to replace our previous $600.0 revolving credit facility. The Credit Agreement includes increased allowances for restructuring and related charges added back to earnings for covenant calculations and other terms, generally consistent with our previous revolving credit facility. The Credit Agreement allows for borrowing of $600.0 in various currencies, and up to $150.0 may be used for the issuance of stand-by letters of credit. We may request an increase in revolving credit commitments under the facility of up to $300.0 in certain circumstances.

We had no borrowings under our $600.0 credit facility as of December 31, 2025 and 2024. Outstanding letters of credit issued totaled $0.4, hence additional borrowings of $599.6 were available to us under the facility as of both December 31, 2025 and 2024.

Under the Credit Agreement, a credit ratings-based pricing grid determines the facility fee and the credit spread that we add to the applicable interbank borrowing rate on all borrowings. At our current credit rating, the annual facility fee is 12.5 basis points paid on the entire facility and the credit spread is 112.5 basis points on any borrowings.

The Credit Agreement contains customary restrictive covenants pertaining to our management and operations, including limitations on the amount of subsidiary debt that we may incur, limitation on dividends and share repurchases if our leverage ratio (Net Debt-to-EBITDA) exceeds 3.0 to 1. EBITDA is defined as net earnings before interest and other expenses, provision for income taxes, intangible asset amortization expense and depreciation and amortization expense. The agreement also includes limitations on our ability to pledge assets, as well as financial covenants requiring that we comply with a maximum leverage ratio of 3.5 to 1 and a minimum fixed charge coverage ratio of 1.5 to 1.

For covenant purposes, net debt is defined as total debt less cash in excess of $200.0 through December 31, 2025 and less cash in excess of $300.0 thereafter. The agreement allows certain restructuring expenses to be excluded from EBITDA, up to fixed annual amounts for 2025, 2026 and 2027, and up to 15% of EBITDA beginning in 2028.

The Credit Agreement contains customary events of default, including, among others, payment defaults, material inaccuracy of representations and warranties, covenant defaults, bankruptcy or involuntary proceedings, certain monetary and non-monetary judgments, change of control and customary ERISA defaults.

As defined in the Credit Agreement, we had a net Debt-to-EBITDA ratio of 2.78 to 1 (compared to the maximum allowable ratio of 3.5 to 1) and a Fixed Charge Coverage ratio of 2.72 to 1 (compared to the minimum required ratio of 1.5 to 1) as of December 31, 2025.

Other

In addition to the previously mentioned facilities, we maintain separate bank credit lines with financial institutions to meet working capital needs of our subsidiary operations. As of December 31, 2025, such uncommitted credit lines totaled $363.1, of which $325.0 was unused. Under the Credit Agreement, total subsidiary borrowings cannot exceed $300.0 in the first, second and fourth quarters, and $600.0 in the third quarter of each year. Additional borrowings of $261.9 could have been made under these lines as of December 31, 2025.

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Our long-term debt has a rating of Baa1 with stable outlook from Moody's Investor Services and BBB- from Standard and Poor's with negative outlook. Both of the credit ratings are investment grade. Rating agencies use proprietary methodology in determining their ratings and outlook which includes, among other things, financial ratios based upon debt levels and earnings performance.

Assessment of the Liquidity Position

We have assessed our liquidity position as of December 31, 2025 and for the near future. As of December 31, 2025, our cash and cash equivalents balance was $871.0. We also have access to the previously mentioned revolving credit facility that could have immediately provided us with up to $600.0 of additional cash, less any outstanding borrowings and letters of credit, and we have an option to request an increase to the total availability under the revolving credit facility by an additional $300.0 and each lender may participate in the requested increase at their discretion. Furthermore, we have access to the previously mentioned credit lines of up to $300.0 ($600.0 in the third quarter) to meet the working capital needs of our subsidiaries, of which $261.9 was available to use, in addition to $150.0 of uncommitted credit facilities at our parent company, as of December 31, 2025. Our 2018 €500.0 ($586.9) notes were redeemed in January 2026, our 2025 €500.0 ($583.8) notes mature in December 2030, and our 2022 €400.0 ($468.3) notes mature in June 2027. Based on the above, we believe we have sufficient liquidity and capital resources to satisfy future requirements and meet our obligations currently and in the near future.

The following table provides an informational summary of our liquidity and capital structure as of:

(a)
Available capacity under the revolving credit facility represents $600.0 of total borrowing capacity less outstanding borrowings and letters of credit.

(b)
Available capacity under the working capital facility represents $150.0 of total borrowing capacity less outstanding borrowings and letters of credit.

Application of Critical Accounting Policies

The preparation of our financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts. A discussion of the more significant estimates follows. Management has discussed the development, selection and disclosure of these estimates and assumptions with the Audit Committee of our Board of Directors.

Defined Benefit Pension Plans

We sponsor several qualified and nonqualified pension plans covering permanent employees. The most significant plans are located in Switzerland, the United Kingdom, the Netherlands, Germany and France. Annual expense relating to these plans was $18.2, $18.0 and $21.7 in 2025, 2024 and 2023, respectively. Pension expense is estimated to be approximately $16.0 in 2026.

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The calculations of annual pension expense and the pension liability required at year-end include various actuarial assumptions such as discount rates, expected rate of return on plan assets, compensation increases and employee turnover rates. We review the actuarial assumptions on an annual basis and make modifications to the assumptions as necessary. We review market data and historical rates, on a country-by-country basis, to check for reasonableness in setting both the discount rate and the expected return on plan assets. We determine the discount rate based on an index of high-quality corporate bond yields and matched-funding yield curve analysis as of the end of each fiscal year. The expected return on plan assets is determined based on the expected returns of the various investment asset classes held in the plans. We estimate compensation increases and employee turnover rates for each plan based on the historical rates and the expected future rates for each respective country. Changes to any of these assumptions will impact annual expense recorded related to the plans.

In determining the estimated 2026 pension expense for non-United States plans, we used a weighted-average discount rate of 3.1% and weighted-average expected return on plan assets of 3.3%. Absent any other changes, a 25 basis point increase or decrease in the weighted-average discount rate would increase or decrease our 2026 consolidated pension expense by $0.1. Absent any other changes, a 25 basis point increase or decrease in the weighted-average expected return on plan assets would decrease or increase our 2025 consolidated pension expense by $1.6. (See Note 9 to the Consolidated Financial Statements found in Item 8. "Financial Statements and Supplementary Data" for further information.)

Income Taxes

The accounting guidance related to uncertain tax positions requires an evaluation process for all tax positions taken that involves a review of probability for sustaining a tax position. If the probability for sustaining a tax position is more likely than not, which is a 50% threshold, then the tax position is warranted and the largest amount, based on cumulative probability, that is greater than 50% likely of being realized upon settlement is recognized. An uncertain tax position, one which does not exceed the 50% threshold, will not be recognized in the financial statements.

We provide for income taxes on a quarterly basis based on an estimated annual tax rate. In determining this rate, we make estimates about taxable income for each of our largest locations worldwide, as well as the tax rate that will be in effect for each location. To the extent these estimates change during the year, or actual results differ from these estimates, our estimated annual tax rate may change between quarterly periods and may differ from the actual effective tax rate for the year.

Goodwill Impairment

In accordance with the accounting guidance on goodwill, we perform an annual impairment test of goodwill at our reporting unit level during the third quarter, or more frequently if events or circumstances change that would more likely than not reduce the fair value of our reporting units below their carrying value. In the event the fair value of a reporting unit is less than the carrying value including goodwill, we record an impairment charge equal to the excess of the carrying amount over the fair value.

We evaluate the recoverability of goodwill utilizing an income approach that estimates the fair value of the future discounted cash flows to which the goodwill relates. This approach reflects management’s internal outlook of the reporting units, which is believed to be the best determination of value due to management’s insight and experience with the reporting units. We evaluate the following assumptions which are used in our goodwill impairment tests: expected future revenue growth rates, OUP margins, working capital levels, discount rates, and terminal value revenue growth rate. We consider expected future revenue growth rates, OUP margins and discount rates to be the more significant assumptions. The expected future revenue growth rates and OUP margins are determined after taking into consideration historical performance, our assessment of future market potential, and expected future business performance conditions. We believe that the discounted cash flow model provides the most reasonable and meaningful estimate of fair value, consistent with how market participants would value our reporting units in an orderly transaction.

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Management closely monitors the financial and operating results relative to the assumptions used in our fair value estimates, as well as macroeconomic conditions and strategic initiatives that may impact the reporting units. During the second quarter of 2025, in connection with the preparation of our financial statements, we assessed the changes in circumstances that occurred during the quarter to determine if it was more likely than not that the fair value of any reporting unit was below its carrying amount. We identified several factors affecting our United Kingdom and Switzerland reporting units that led us to conclude an interim goodwill impairment assessment was necessary. These factors included deterioration of the macroeconomic and local market conditions, financial performance below management’s planned revenue and OUP expectations for the first half of 2025, and downward revisions to full-year 2025 revenue and OUP projections. As a result, we recognized a partial non-cash goodwill impairment loss of $33.4 for our United Kingdom reporting unit in our Northern Europe segment and $24.7 for our Switzerland reporting unit in our Southern Europe segment, reducing their carrying values to estimated fair value. Key assumptions in the United Kingdom discounted cash flow valuation included a discount rate of 11.4%, revenue growth for the next 10 years ranging from -8.4% to 10.0% and average OUP margin approximating 2.5%. Key assumptions in the Switzerland discounted cash flow valuation included a discount rate of 11.2%, revenue growth for the next 10 years ranging from -12.4% to 12.0% and average OUP margin approximating 3.0%.

During the third quarter of 2025, we completed the annual impairment test of our goodwill and indefinite-lived intangible assets. The fair value exceeded the carrying amount by more than 10% for all reporting units except the United Kingdom and Switzerland, whose carrying values had already been adjusted to fair value in the second quarter. As of December 31, 2025, the goodwill balances related to our United Kingdom and Switzerland reporting units were $78.0 and $35.5, respectively.

Key assumptions for our United States reporting unit in our Americas segment, which represents the reporting unit with the most significant goodwill balance, included a discount rate of 9.4%, revenue growth rates for the next 10 years ranging from -1.7% to 8.0%, and average OUP margins approximating 5.0%. Management closely monitors the performance and assumptions used in our fair value estimates, along with macroeconomic and operational developments that may impact future impairment assessments.

During the fourth quarter of 2025, in connection with the preparation of our annual financial statements, we assessed the changes in circumstances that occurred during the quarter to determine if it was more likely than not that the fair value of any reporting units were below its carrying amount. The actual results of revenues and OUP margins for our key reporting units were consistent with the forecasted assumptions for the near-term revenue growth and OUP margins utilized in the discounted cash flow models as of our valuation date. Additionally, we performed an updated analysis of our market cap reconciliation to the values derived from our discounted cash flow models during our annual impairment testing in light of the lower stock price as of December 31, 2025. In evaluating triggering events and assessing the reasonableness of our market cap reconciliation as of December 31, 2025, we considered external data points from analysts, market peers, our past history and experience, 2025 actual results and our near term and long-term forecasts. Further, we considered the results of the fourth quarter whereby we saw largely stable activity levels across North America and Europe overall, with improving trends in certain of our reporting units and we expect these trends to continue into 2026. We concluded, based on our analysis performed, that the fair value of the reporting units continued to equal or exceed the carrying value and did not identify a triggering event.

There could be significant further decreases in the operating results of our reporting units for a sustained period, which may result in a recognition of goodwill impairment that could be material to the Consolidated Financial Statements.