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Please standby. Hello and welcome to the Robert Half First Quarter 2025 Conference Call. Today's conference is being recorded. [Operator Instructions] Our host for today's call are Mr. Keith Waddell, President and Chief Executive Officer of Robert Half; and Mr. Michael Buckley, Chief Financial Officer. Mr. Waddell, you may begin.

Hello everyone. We appreciate your time today. Before we get started, I'd like to remind you that the comments made on today's call contain forward-looking statements, including predictions and estimates about our future performance. These statements represent our current judgment of what the future holds. However, they're subject to the risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. These risks and uncertainties are described in today's press release and in our most recent 10-K and 10-Q filed with the SEC. We assume no obligation to update the statements made on today's call. During this presentation, we may mention some non-GAAP financial measures and reference these figures as adjusted. Specifically, we present adjusted revenue growth rates, which removed the impacts on reported revenues from the changes in the number of billing days and foreign currency exchange rates. Additionally, we present adjusted gross margin, adjusted selling, general and administrative expenses, and adjusted operating income by combining the gains and losses on investments held to fund the company's obligations under employee deferred compensation plans with the changes in the underlying deferred compensation obligations. Since the gains and losses from investments and the changes in deferred compensation obligations completely offset, there is no impact on our reported net income. Reconciliations and further explanations of these measures are included in a supplemental schedule to our earnings press release. For your convenience, our prepared remarks for today's call are available in the Investor Center of our website, roberthalf.com. For the first quarter of 2025, global enterprise revenues were $1.352 billion, down 8% from last year’s first quarter on a reported basis, and down 6% on an adjusted basis. Net income per share in the first quarter was $0.17, compared to $0.61 in the first quarter one year ago. First quarter 2025 net income was reduced by $0.13 per share for one-time charges related to cost actions to reduce ongoing administrative expenses. Business confidence levels moderated during the quarter in response to heightened economic uncertainty over U.S. trade and other policy developments. Client and job seeker caution continues to elongate decision cycles and subdue hiring activity and new project starts. Despite the uncertain outlook, we are very well-positioned to capitalize on emerging opportunities and support our clients’ talent and consulting needs through the strength of our industry-leading brand, our people, our technology, and our unique business model that includes both professional staffing and business consulting services. Cash flow used in operations during the quarter was $59 million. Cash outflows are typically elevated each year in the first quarter due to the annual payment cycle for bonuses and SaaS subscription renewals, among others. In March, we distributed a $0.59 per share cash dividend to our shareholders of record for a total cash outlay of $61 million. Our per share dividend has grown an average of 11.6% annually. Since its inception in 2004, the March 2025 dividend was 11.3% higher than the prior year. We also acquired approximately 650,000 Robert Half shares during the quarter for $39 million. We have 6.6 million shares available for repurchase under our Board-approved stock repurchase plan. Return on invested capital for the company was 5% in the first quarter. Now, I'll turn the call back over to our CFO, Mike Buckley.

Thank you, Keith. Hello everyone. As Keith noted, global revenues were $1.352 billion in the first quarter. On an adjusted basis, first quarter Talent Solutions revenues were down 11% year-over-year. U.S. Talent Solutions revenues were $676 million, down 10% from the prior year's first quarter. Non-U.S. Talent Solutions revenues were $199 million, down 15% year-over-year. We conduct Talent Solutions operations through offices in the United States and 17 other countries. In the first quarter, there were 61.9 billing days compared to 62.8 billing days in the same quarter one year ago. The second quarter of 2025 has 63.2 billing days compared to 63.5 billing days during the second quarter of 2024. Currency exchange rate movements during the first quarter had the effect of decreasing reported year-over-year total revenues by $12 million; $10 million for Talent Solutions and $2 million impact to Protiviti. Contract Talent Solutions bill rates for the first quarter increased 4.2% compared to one year ago, adjusted for changes in the mix of revenues by functional specialization, currency, and country. This rate for the fourth quarter was 3.4%. Now, let's take a closer look at the results for Protiviti. Global revenues in the first quarter were $477 million, $387 million of that is from the United States and $90 million is from outside of the United States. On an adjusted basis, global first quarter Protiviti revenues were up 5% versus the year ago period. U.S. Protiviti revenues were up 4%, while non-U.S. Protiviti revenues were up 8% compared to one year ago. Protiviti and its independently owned member firms serve clients through locations in the United States and 28 other countries. Turning now to gross margin. In Contract Talent Solutions, first quarter gross margin was 38.9% of applicable revenues versus 39.5% in the first quarter one year ago. Conversion or contract to hire, revenues were 3.2% of contract revenues in both the current quarter and the first quarter of 2024. Our permanent placement revenues were 12.8% of consolidated Talent Solutions revenues in the current quarter and 12.3% in the first quarter of 2024. When compared with contract Talent Solutions gross margin -- I'm sorry, when combined with contract Talent Solutions gross margin, overall gross margin for Talent Solutions was 46.7% compared to 47% of applicable revenues in the first quarter one year ago. For Protiviti, gross margin was 18.9% of Protiviti revenues in both the current quarter and the first quarter of 2024. Adjusted gross margin for Protiviti was 18.1% for the quarter just ended compared to 20.7% last year. Protiviti gross margin for the current quarter includes $8 million of one-time charges related to cost reductions to reduce ongoing administrative expenses. These mid-April actions are expected to result in annual savings of $32.5 million, with 75% of a full quarter's benefit recognized in the second quarter due to timing and the full benefit each quarter thereafter. Enterprise SG&A costs were 34% of global revenues in the first quarter compared to 35.4% in the same quarter one year ago. Adjusted enterprise SG&A costs were 35.2% for the quarter just ended compared to 33% one year ago. Talent Solutions SG&A costs were 43.7% of Talent Solutions revenues in the first quarter versus 44.3% in the first quarter of 2024. Adjusted Talent Solutions SG&A costs were 45.5% in the quarter just ended compared to 40.8% last year. Talent Solutions SG&A for the current quarter includes $9 million in one-time charges related to mid-March cost actions to reduce ongoing administrative expenses, which are expected to result in annual savings of $47.5 million with full effect in the second quarter and thereafter. First quarter SG&A costs for Protiviti were 16.3% of Protiviti revenues compared to 15.9% of revenues the same quarter one year ago. Operating income for the quarter was $39 million. Adjusted operating income was $19 million in the first quarter or 1.4% of revenue. First quarter adjusted operating income for our Talent Solutions divisions was $10 million or 1.2% of revenue. Adjusted operating income for Protiviti in the first quarter was $9 million or 1.8% of revenue. Adjusted operating income includes $17 million of one-time charges related to cost actions to reduce ongoing administrative expenses, $9 million for Talent Solutions, and $8 million for Protiviti. Our first quarter 2025 income statement includes a $20 million loss from investments held in employee deferred compensation trust. This is completely offset by an equal reduction of employee deferred compensation costs, which are reflected in SG&A expenses and direct costs. As such, it has no effect on our reported net income. Our first quarter tax rate was 22% compared to 30% one year ago. The lower 2025 rate reflects the accelerated timing of certain tax credits that would have otherwise been recorded in the upcoming fourth quarter. This has no impact on the estimated full year tax rate for 2025 of 31% to 33%. At the end of the first quarter, accounts receivable were $787 million and implied days sales outstanding, or DSO, was 52.4 days. Before we move to second quarter guidance, let's review some of the monthly revenue trends we saw in the first quarter and so far in April, all adjusted for currency and billing days. Contract Talent Solutions exited the first quarter with March revenues down 13% versus the prior year compared to a 12% decrease for the full quarter. Revenues for the first two weeks of April were down 12% compared to the same period last year. Permanent placement revenues in March were 10% versus March 2024. This compares to an 8% decrease for the full quarter. For the first three weeks of April, permanent placement revenues were down 2% compared to the same period in 2024. We provide this information so that you have insight into some of the trends we saw during the first quarter and into April. But as you know, these are very brief time periods. We caution against reading too much into them. With that in mind, we offer the following second quarter guidance. Revenues of $1.31 billion to $1.41 billion, income per share $0.36 to $0.46. Midpoint revenues of $1.36 to $1.36 billion are 7% lower than the same period in 2024 on an as-adjusted basis. On a sequential basis, mid-quarter estimated Q2 revenues are down 4%. For the most recent six-week period ended April 11th, weekly sequential revenues have remained essentially flat. The major financial assumptions underlying the midpoint of these estimates are as follows; adjusted revenue growth year-over-year for Talent Solutions, down 10% to 14%; for Protiviti up 1% to up 4%; overall, down 5% to 9%. Adjusted gross margin percentages for contract talent 38% to 40%; Protiviti 21% to 24%; overall 37% to 39%. Adjusted SG&A as a percentage of revenue Talent Solutions, 43% to 45%; Protiviti, 15% to 16%; overall, 33% to 35%. We adjusted operating income as a percentage of revenues, Talent Solutions, 2% to 4%; Protiviti, 6% to 8%; overall, 3% to 6%. Tax rate, 31% to 35%; shares outstanding 100 million to 101 million. 2025 capital expenditures and capitalized cloud computing costs, $75 million to $95 million with $15 million to $25 million in the second quarter. All estimates we provide on this call are subject to the risks mentioned in today's press release and in our SEC filings. Now, I'll turn the call back over to Keith.

Thank you, Mike. U.S. trade policy uncertainty has caused many economists to lower their economic growth forecast for the remainder of the year. Business confidence levels, which had surged following the U.S. elections, have recently moderated. Given this, in March, we reduced our administrative cost structure and lowered staffing levels at corporate services and for administrative field positions in Talent Solutions and did so in April for Protiviti. Revenue-producing roles were not impacted. This results in annual cost savings of $80 million and will improve profitability levels. Despite the present uncertain outlook, we remain optimistic about our growth prospects once economic conditions improve. U.S. job openings continue to reflect strong pent-up demand and remain well above historical averages. The supply of labor remains tight. The unemployment rate in the United States for those with a college degree is only 2.6%, with rates for many in demand, accounting, finance, and other professionals even lower. Though the latest NFIB, Small Business Optimism Index is off its recent peaks, it is still only slightly below its long-term average. Further, 40% of small business owners report job openings they could not fill in March. And of those trying to hire 87% reported few or no qualified applicants for the positions they were trying to fill. As business confidence improves, hiring urgency returns, project demand accelerates, deferred backlogs and growth initiatives are reprioritized, and labor churn normalizes. This puts pressure on client resources that are often already stretched thin and creates hiring and consulting demand that traditionally sets the stage for very strong gains early -- in the early part of growth cycles. Although Protiviti's results were also impacted by elevated economic uncertainty, it achieved year-over-year revenue growth for the third quarter in a row. Protiviti's prospect and pipeline remain very strong, though the current environment has lengthened the time it takes to convert opportunities to wins and begin projects. The expanded use of contract professionals, sourced through Talent Solutions, continues to be a significant contributor to Protiviti's success and is a key component of our enterprise-wide competitive advantage. We hold steadfast to our time-tested corporate purpose to connect people to meaningful and exciting work and provide clients with the talent and consulting expertise they need to constantly compete and grow. We'd like to thank our employees across the globe for their resilience unwavering commitment to success. Their efforts have earned us significant recognition already in 2025, including being entered as One of America's Most Innovative Companies by Fortune, and One of America's Best Large Employers by Forbes. We're particularly proud that high levels of employee engagement, again earned both Robert Half and Protiviti recognition has two of Fortune's 100 Best Companies to Work For. Now, Mike and I'd be happy your answer your questions. Please ask just one question and a single follow-up as needed. If there's time, we'll come back to you for additional questions.

Thank you. [Operator Instructions] And your first question comes from the line of Mark Marcon with Baird.

Hey good afternoon and thanks for taking my questions. Keith, when we take a look at Protiviti, clearly, the revenue was still up year-over-year. The margins ended up contracting. Obviously, you've got a bench model and deleveraging. So, the questions are around Protiviti. When you think about the book of business within Protiviti, how much would you characterize as basically being recurring or less discretionary relative to purely more discretionary, nice to have because you're still looking at potential growth for the first quarter, and I'm wondering how you think that kind of unfolds as the year goes along and where the margins could end up being if things stay steady-state or conversely, if things get a little bit worse? And then I've got a follow-up.

Well, I guess we've never really officially formally broken out discretionary versus non-discretionary. If you look at our big four solutions, risk and compliance, primarily regulatory remediation and compliance, that's not discretionary. If you look at technology consulting, clearly, there's a must do and -- it improves thing to do dichotomy there. So, that is split. Internal audit in our largest industry financial services is not discretionary. It has to happen in the non-FSI industries segments, there is some discretion there and then business process improvement is probably the most discretionary of all. If those four are about equal -- I mean, technology is a little larger and risk and consulting is a little smaller. I added up the split I just talked about. But there's a decent mix of the two. As we said, this is the third quarter in a row that they've had revenue growth. Notwithstanding, the uncertain macro, we expect sequential growth in all of those major solutions into the second quarter. We're more conservative with that sequential growth than we've been in years past, but we still feel good, given the pipeline. And adjusted for the slower conversion of pipeline time, we feel reasonably good about where Protiviti is from a profitability standpoint as you observed that the revenue shortfall relative to expectation was centered primarily on Protiviti employees versus contract employees. So, it had a disproportionate impact on profitability. The good news is in the coming quarter, just the opposite happens and that we actually convert more than the revenue improvement to the bottom-line because not only are we better utilizing the full-time staff we have, we're also swapping out some full-time staff contract staff and actually save direct cost dollars in that way. So, it's actually one of our better sequential improvements given that dynamic.

That's great. And then I'm hesitant to ask this question, but I've been getting it a lot from a lot of different investors and so I know it's top of mind with a number of them. I think I know the answer already. But when we take a look at capital allocation, where does the dividend sit on your capital allocation priorities? And could you envision a scenario based on what you're currently seeing where the dividend would ever be cut?

And so we've had a long, long, long-term commitment to return our excess cash flow to shareholders. Over the long-term, that's been about 50% dividends, 50% repurchases. As earnings have contracted, dividends play a much larger role in that capital return. We're committed just as we have since we started in 2004, to raise that dividend. We just raised it last quarter and it would certainly be our intention not only to keep it but to keep increasing it. And that the cash flow of the first quarter, as we already commented, there are seasonable impacts to cash flow, i.e., annual bonus payments, annual SaaS payments as that make first quarter cash flow look low, but we certainly expect that to rebound nicely for that reason. So, no change in capital allocation strategy, still return all our cash flow to share -- excess cash flow to shareholders. Retain the dividend, and it just happens to be given where overall cash flow is, dividend is going to be a larger portion of the total, but that's something we believe will work its way out as we move forward in time just as we have in the past. But no change in capital allocation strategy.

That's what I expected. Thanks a lot.

And the next question will come from Andrew Steinerman with JPMorgan.

Hi Keith. I'd like to hear a little bit more about the efficiencies Robert Half is bringing to the administrative cost structures in both Talent Solutions and Protiviti. You were very clear to say these cost savings won't affect revenue-producing rules. Could you just be a little more specific about how you're replacing these roles? Is this a tech-enabled solution? Are the revenue role is going to be as enabled to hungrily go after orders with these efficiencies?

Well, for two or three years, we've had some pretty significant negative leverage on our administrative compensation and overhead cost. And our view was, given lower volumes, given technology improvements and tools that have -- that we've implemented over the last few years that we could operate more efficiently. The majority of the reductions were corporate services. And those reductions that happened in the field were more field management positions, not field sales support positions. So, I would argue there's very, very little impact on how well our revenue-producing roles are supported based on what we did principally at corporate services.

Thank you, Keith.

And the next question will come from Manav Patnaik with Barclays.

[indiscernible], but historically, you've also said that you'd rather be a little bit late to cut cost. So, just curious on what you've heard directly from your clients and you talked about how all the economists are predicting different things, but any change in behavior on your clients that prompted you to take this action right now?

Well, the change in behavior is -- was a continuation of the cautiousness that we were beginning to see improvements in that we talked about on the last call. We came out of the election. There was a surge in business confidence, our discussions in the -- tender of our discussions with our clients was improving. And so we were quite optimistic in our forecast for the first quarter assumed flatness with what we had seen in the fourth -- and that changed those discussions changed as a result of the uncertainty and the trade policy uncertainty that I talked about already, but the fact that -- it has been a couple of years since we had adjusted corporate overhead cost, we were continuing to see negative leverage. Given the renewed economic uncertainty, it appeared that this was going to be with us longer than we had hoped. And so some combination of all those factors said, it was time for us to take cost actions, again, not impacting revenue producers.

Okay. Fair enough. And then just a quick follow-up. I know you did some M&A recently. Just curious if you could help us with the contribution either in the quarter or for the rest of the year?

And so Protiviti acquired a small consulting firm in France that specializes in financial services, they have about 50 consultants. So, it's a very small transaction, but one we're excited about. It adds capabilities that we didn't otherwise have. They're in Paris.

And the next question will come from Stephanie Moore with Jefferies.

Hi good afternoon. Thank you. Maybe sticking with the topic of Protiviti here. Can you talk a little bit about maybe the pipeline of projects or underlying demand environment that you're seeing within Protiviti? If you've seen any of your clients that may have paused to projects or delayed the start of projects just given this underlying uncertain environment? Thank you.

Well, as to the pipeline, the pipeline is up year-on-year. The weighted pipeline weighted for probability of success is up year-on-year. That said, we did see during the first quarter, some delays, some pauses related to, particularly, financial services client engagements, but all of that's been factored in, in the guidance we're giving for the second quarter. But yes, Protiviti has certainly been impacted somewhat by the macroeconomic uncertainty that's been exacerbated in the last few months. But that said, they still manage to grow year-on-year.

Absolutely. That's helpful. And then one clarification on the 2Q outlook. I guess -- I'm trying to understand what the underlying perm demand environment is like, I think you kind of called out what it was in March. And I think it looks like on a year-over-year basis, it looks like it might have improved to April versus March. Maybe I'm misreading this, but is there something from a year-over-year comp standpoint, we should think about? Or did perm kind of end up turning the corner a little bit better for the first couple of weeks of April? Thanks.

Well, it's just factual that for two or three weeks, I guess, in April for perm that it's stronger than it had been, and it's stronger than contract. But it's three weeks, and we've talked many times, post-quarter perm results are much less predictive of full quarter results than is the case in contract. But that said, we did begin the quarter in perm more strongly than we did in contract, and that's a good thing.

Thank you. Appreciate it.

And your next question will come from Kartik Mehta with Northcoast Research.

This might be an odd question, I realize that, but you talked about the uncertainty in the economy, and I know -- you talked about when things turn, they could turn quickly. And it seems like we get a new headline every day. And so I'm wondering, if things do turn quickly, how quickly could you ramp back up? And how quickly would that impact margins? Or how do you see the business trending if something like that happens?

Well, we think we could turn back up quickly. As I've said earlier, we have not impacted our revenue producers with these cost actions we've carried more revenue producers than the revenues would otherwise dictate. We've talked about 20% to 30% upside based on prior productivity levels. I would also say we're seeing nice early traction from a technology standpoint where we use AI to direct our recruiters to the clients, we believe have the best probability of converting. And so there, we're seeing it takes fewer calls to get a client visit -- and once you get a client visit, we get better conversion rates to job orders than we did pre this technology. So, I would argue, if anything, that even helps participate in the upside, call this digital labor, if you will, that gives us capacity above and beyond the human labor that we've retained beyond what the revenues would say in the first place. And so I am very bullish on our ability to participate in the upside we've talked about. Unemployment is lower. That means it'd be tougher for clients to hire on their own and the upside, that's good for us. There's more pent-up demand. Job openings are still elevated. That's good for us. Churn. Churn is very subdued as we speak. Just to illustrate that, I think people often forget that the jobs numbers that come out every month are net numbers. There are hires minus separations, which are essentially quits. And so as an example, in June of 2023, there were 257,000 jobs added, but that was 6.5 million hires and 6.3 million separations. We'll roll the clock forward to last month. Here, we had 228,000 net job openings, not that different from June of 2023, but here, we've got 5.5 million hires and 5.3 million separations, meaning 1 million fewer hires, 1 million fewer separations than the same net jobs number -- the point is that's a significant difference in churn. And so as clients and candidates get more confident as things turn, there are more hires, there are more quits, there's more churn, that's good for our business on the upside.

And then, Keith, I know you've talked about this in the past, but just wanted to get your perspective, again, technology impacting the business, whether it's LinkedIn or apps people are using to find help. Has that impacted your business, especially your small business customers?

I would say the job boards and the aggregators have been around a long time. LinkedIn has been around a long time. The freelance platforms have been around a long time. We consider all of them frenemies because on the one hand, we compete at some level. On the other hand, we also use their technologies and our own sourcing efforts. And I would argue that none of them have recently moved the needle and change the calculus in a significant way as to whether a small business owner decides to use a recruiting firm like Robert Half or not. So, those options have been there for long periods of time. And I don't think relatively speaking, they're any more attractive than they were. They've gotten better, we've gotten better.

Thank you very much.

And the next question comes from George Tong with Goldman Sachs.

Hi thanks. Good afternoon. You mentioned client and job seeker caution is elongating decision cycles and doing hiring activity and new project starts. Can you talk about how this was reflected in weekly sequential revenue trends over the course of the quarter?

Well, if you remember last quarter, we said the first couple of weeks were holiday impacted. The third, we kind of return to what we had seen the prior quarter, which had been flat, I believe, for 23 straight weeks. So, we were getting back to what we expected, but then start at least early February, the weekly started to drift down. But then by March, they flattened out at that somewhat lower level. So, on a weekly sequential basis, as we said in our prepared remarks, the month of March and the first two weeks of April are essentially flat. On a -- relative to the entire first quarter, that's about down 1.5%. The guidance we gave was more conservative and assumes down 4%. And so again, on a weekly basis, flat for the most recent six weeks, so it stabilized at a 1.5% lower level than we saw on average for the prior quarter.

Got it. That's helpful. And then can you talk a little bit about how much of an impact do you think job displacements by AI is having on the business. Specifically, how much of the revenue decline you're seeing now, you would attribute to cyclical factors versus AI?

Well, I as it relates to AI-driven tools today that impact accounting and finance, which is our major sector, I would say there's very, very little impact. And the revenue impacts we've seen are because of client cautiousness, that leads to less hiring that I just talked about, which in turn leads to candidate caution, which leads to fewer candidate quits that I just talked about. So, less churn due to client and candidate caution and therefore, cyclical factors, I think, are by and large, the essential reason why not just ours, but the entire industry revenues have been impacted. I'd say further on this issue of displacement, and I'm sure you've heard this as well, there's this concept of Jevons Paradox that says when resources become more efficient because of AI or otherwise, the cost of using it decreases and at lower cost, in fact, leads to increased consumption and usage. And so I think in the terms of AI, offsetting the apparent impact, there will be displacement will be the potential impact, there will be more usage because the unit costs are less. I look at our own internal IT projects. And if the thought of it cost me less to modify/develop software for Robert Half. My guess is I might use more rather than less because it's less costly to do. So, I think there's some credibility to Jevons Paradox. You form your own opinion, I'm sure you already have.

Got it. Very helpful. Thank you.

And we'll take a question from Kevin McVeigh with UBS.

Great. Thanks so much. Keith, I just wanted to clarify one thing on the restructuring. I just want to make sure I heard you right. I thought you said there was $0.17 [ph] in the Q1, and you took another charge in -- was it equal for Protiviti? Or was all of that -- the first quarter? Or was there a Q2 charge for Protiviti in the Q2 guidance?

It's all in the first quarter. It's all in the first quarter. It just happened a few weeks apart.

Got it. Okay. So, it was all in one. And as you think about that--

We accrued all that Protiviti did in April for the first quarter.

Got it. Got it. And that $0.17, much of it in the core versus Protiviti, is there any way to think about that?

Well, you were breaking up. So, it was $9 million staffing, $8 million Protiviti in cost. And then the resulting savings are $80 million and it was 42.5% and 37.5% between the two. And then that $80 million is about $0.54 a share savings.

And is that -- I know that's annual, do you start to see that in the second half of this year? Or any sense of how that $80 million comes in?

We see -- and so divide it by four, that's $20 million a quarter. We'll see $18 million of that in the second quarter, and then we'll see $20 million of that in quarters three and four. So, it will happen right away. But for the piece in Protiviti that happened pre-April, mid-April. So, $18 million savings in Q2 and $20 million savings in Q3 and Q4 from the cost actions.

So, the $0.36 to $0.46 already includes about -- is that -- how much cost savings in that--

It includes the $18 million, the $36 million to $46 or the $41 million at midpoint includes $18 million in savings.

Okay. So, without that $18 million, it would have been obviously that much lower, EPS?

That's right. But I mean, the other observation I would make, inclusive of the savings, our sequential progression between quarters one and two is one of the better progressions we've had historically.

Yes. No, I get it.

And if you further -- if you pro forma in a full quarter's benefit for Protiviti, Protiviti's margins return essentially to what they were a year ago.

Great. So, the $18 million, if you were to -- was that tax to the regular rate? I'm just trying to like put what's the benefit of--

Well, the tax provision is a little wonky. But if you take the $18 million and you tax effect it, I get $0.12, and I'm looking at the team here, you take you take 67% of it at a 33% tax rate, which gives you 12% and it's essentially 100 million shares. So, I call it $0.12.

$0.12 benefit in Q2 from the restructuring. It's very helpful. Thank you. Thank you very much.

And next is Jeff Silber with BMO Capital Markets.

Hey, thank you. This is Ryan on for Jeff. I was just wondering if you have any comments on the competitive environment. I was wondering how you're bearing compared to big four on Protiviti and then just related to the other temp agencies and contract solutions? Thank you.

Well, I guess we would observe on the big four side, the competitive environment has stabilized. We're not seeing the crazy pricing that we had seen nine, 12, 15 months ago. On the Talent Solutions side, most of our competitors are local and regional. And we haven't seen much change in that throughout this period of client candidate cautiousness is, which we're now going on for almost three years. So, I would argue not much change in the competitive environment and if anything, more rational, particularly as it relates to the big four than it had been.

Got it. Thank you.

And our next question is from Trevor Romeo with William Blair.

Hi. Thank you for taking the questions. Just a couple of quick ones, I guess, on the Talent Solutions business. One was just kind of wanted to ask about, I guess, how the mix is evolving between high skilled and more sort of operational roles right now. Are you still seeing I guess, relative resilience in the higher-skilled roles? And then as it relates to the up-catch [ph] or the full-time engagement professionals, anything you'd call out in terms of demand or interest in those arrangements?

Yes, I'd say we continue to move up the skill curve. That's particularly true in technology. If you look at our segments, technology has done better for two or three, four quarters in a row. Much of that involves going from infrastructure and operations positions to software and applications positions. There's a meaningful bill rate difference. You'll note on the bill rate side, we went from the plus 3s to the low plus 4s this quarter year-on-year bill rate increases. Much of that is this skill mix impact, particularly as it relates to technology. On the FTAP side, the issue with FTAP because we pay them for benefits, the cost per hour for those people is much higher than is for our core contractors and that higher price has put some pressure on the volumes in that business. But particularly returning to how well will we participate in the upside, FTAP becomes a big part of the upside, clients will be more willing to pay those prices that they at that time as they've proven in the past. And that's good for margins, that's good for bill rates, that's good for length of assignment, that's good for everything.

And could you just remind us how big a portion of your mix are the FTAPs at this point?

It's roughly 20% of our contract business. I'm measuring hours versus dollars, it changes a little bit, but it's in that range.

Okay, thank you. That's helpful. And just one quick one on the international business. It just looks like the Talent Solutions; the trend got a little bit worse in the first quarter. Could you just talk through kind of what you're seeing in Europe or any other countries?

Well, I guess I would argue that more of the differential between the growth rates in U.S. versus non-U.S. relate to the year ago comps than they do to current performance. And so as an example, a year ago in U.S., we were down 19%. And a year ago, I

Okay, very helpful. Thank you.

Okay. So that was our last question. Thank you very much for joining us.