Robert Half Charts Path to Recovery Amid Economic Headwinds, Betting on AI and Lean Operations
This analysis is based on the Robert Half Inc. (NYSE: RHI) Q4 2025 earnings call held on January 29, 2026.
NEW YORK – Facing a persistent softness in the staffing market, Robert Half Inc. reported a decline in fourth-quarter revenues but struck a cautiously optimistic tone about its roadmap for recovery. During the earnings call, CEO Michael Waddell detailed a multi-pronged strategy focused on operational efficiency, strategic AI adoption, and capitalizing on latent demand in the permanent placement sector.
Waddell projected a return to positive year-over-year growth by the third quarter of 2026, a timeline contingent on the anticipated ramp-up of retained "best producers" and efficiency gains. "We have maintained our core strength—our people—and are now layering in technology to enhance our service delivery," Waddell stated, referring to AI initiatives aimed at improving internal productivity and capturing new revenue streams.
Contrary to broader market narratives, the company sees underlying strength in permanent placement, particularly among small and medium-sized businesses (SMBs). "After prolonged cost-cutting, many SMBs are operating lean and will need to normalize headcount," Waddell explained, suggesting pent-up demand could soon materialize.
The discussion around Artificial Intelligence revealed a nuanced perspective. While acknowledging AI introduces uncertainty, Waddell argued it has not yet materially slowed full-time hiring decisions. Instead, it may be boosting demand for flexible contract workers as clients seek agility. In a notable insight, he suggested AI is complicating the hiring process for clients through an influx of AI-tailored resumes, thereby increasing the value of Robert Half's human-driven vetting and placement services. "In accounting and admin, the disruption isn't new; automation is established. Our role is evolving from supplier to strategic navigator," he added.
For its consulting division, Protiviti, the plan involves leveraging "hidden capacity" within its current underutilized workforce to capture revenue growth without immediate, significant headcount additions.
Market Reaction & Analyst Commentary:
The call drew mixed reactions from industry observers.
"The focus on efficiency and a clear path to margin improvement is commendable," said David Chen, a senior analyst at Bristol Street Advisors. "Retaining top performers during a downturn is a classic, wise move that should pay dividends quickly when the market turns."
Echoing a sentiment of cautious wait-and-see, Priya Sharma, managing partner at Laurelwood Partners, noted, "The Q3 2026 target for growth is ambitious but plausible if the macroeconomic environment cooperates. Their read on SMB demand could be the key catalyst."
However, a more critical voice emerged. "This feels like a hope-and-pray strategy dressed up in AI buzzwords," argued Marcus Thorne, editor of The Workforce Dispatch blog. "They're talking about 'hidden capacity' and AI saving the day while revenues are down. Where's the bold, new initiative? The staffing industry is being fundamentally reshaped, and playing it safe might mean getting left behind."
For the complete details, the full transcript of the Robert Half Q4 2025 earnings call is available on the company's investor relations website.