1% Growth in Total Revenues to $1.3 Billion for the First Quarter 2025
Repurchased 1.2 Million Shares in the First Quarter 2025
DUBLIN, Calif., April 25, 2025 /PRNewswire/ -- TriNet Group, Inc. (NYSE: TNET), a leading provider of comprehensive and flexible human capital management (HCM) solutions for small and medium-size businesses (SMBs), today announced financial results for the first quarter ended March 31, 2025. The first quarter highlights below include non-GAAP financial measures which are reconciled later in this release.
"We had a strong start to 2025 delivering financial performance consistent with our full-year guidance," said Mike Simonds, TriNet President and CEO. "The strength of our business model was evident as we helped customers navigate a challenging economic environment."
Simonds continued, "We have a clear plan in place, caring for our customers, repricing our benefits offering, and investing in multiple initiatives to drive growth and a more efficient delivery model. We remain confident in our large market opportunity and our ability to grow share over the medium term."
First quarter highlights include:
- Total revenues increased 1% to $1.3 billion compared to the same period last year.
- Professional service revenues decreased 2% to $209 million compared to the same period last year.
- Net income was $85 million, or $1.71 per diluted share, compared to net income of $91 million, or $1.78 per diluted share, in the same period last year.
- Adjusted Net Income was $99 million, or $1.99 per diluted share, compared to Adjusted Net Income of $111 million, or $2.16 per diluted share, in the same period last year.
- Adjusted EBITDA was $162 million, representing an Adjusted EBITDA Margin of 12.6%, compared to Adjusted EBITDA of $180 million, representing an Adjusted EBITDA Margin of 14.2%, in the same period last year.
- Average WSEs decreased 2% compared to the same period last year, to approximately 341,000.
- Returned $102 million to shareholders through share repurchases and dividends
Full-Year 2025 Guidance
In addition to announcing our first quarter 2025 results, we are reiterating our full-year 2025 guidance. Non-GAAP financial measures are reconciled later in this release.
Full Year 2025 | |||||
(dollars in millions, except for per share amounts) | Low | High | |||
Total Revenues | $4,950 | $5,140 | |||
Professional Service Revenues | $700 | $730 | |||
Insurance Cost Ratio | 92 % | 90 % | |||
Adjusted EBITDA Margin | 7 % | 9 % | |||
Diluted net income per share of common stock | $1.90 | $3.40 | |||
Adjusted Net Income per share - diluted | $3.25 | $4.75 | |||
Quarterly Report on Form 10-Q
We anticipate filing our Quarterly Report on Form 10-Q ("Form 10-Q") for the three months ended March 31, 2025 with the U.S. Securities and Exchange Commission (SEC) and making it available at https://www.trinet.com today, April 25, 2025. This press release should be read in conjunction with the Form 10-Q and the related Notes to Consolidated Financial Statements and Management's Discussion and Analysis of Financial Condition and Results of Operations contained in the Form 10-Q.
Earnings Conference Call and Audio Webcast
TriNet will host a conference call at 5:30 a.m. PT (8:30 a.m. ET) today to discuss its first quarter results for 2025 and provide full-year financial guidance for 2025. TriNet encourages participants to pre-register for the webcast and conference call. The live webcast of the conference call can be accessed on the Investor Relations section of TriNet's website at https://investor.trinet.com. Participants can pre-register for the webcast by going to: https://events.q4inc.com/attendee/796608745. Callers can pre-register by going to: https://dpregister.com/sreg/10198705/fee38a6e3d. For those who would like to join the call but have not pre-registered, they can do so by dialing +1 (412) 317-5426 and requesting the "TriNet Conference Call." A replay of the webcast will be available on this website for approximately one year. A telephonic replay will be available for two weeks following the conference call at +1 (412) 317-0088 conference ID: 7301000.
About TriNet
TriNet is a leading provider of Human Resources solutions for small and medium size businesses, offering advanced technology-enabled services that include human capital expertise, employee benefits such as health insurance and retirement plans, payroll and payroll tax administration, risk mitigation, and compliance consulting. Our long-term objective is to be the premier provider of HR services for a broad range of SMBs through industry leading benefits, sales distribution excellence, and a world class services delivery model. For more information, visit TriNet.com or follow us on Facebook, LinkedIn and Instagram.
Use of Non-GAAP Financial Measures
Reconciliations of non-GAAP financial measures to TriNet's financial results as determined in accordance with GAAP are included at the end of this press release following the accompanying financial data. For a description of these non-GAAP financial measures, including the reasons management uses each measure, please see the section titled "Non-GAAP Financial Measures."
Forward-Looking Statements
This press release contains, and statements made during the above referenced conference call will contain, statements that are not historical in nature, are predictive in nature, or that depend upon or refer to future events or conditions or otherwise contain forward-looking statements within the meaning of Section 21 of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, including, among other things, TriNet's expectations and assumptions regarding: TriNet's financial guidance for the full-year 2025 and the underlying assumptions; TriNet's market opportunity and TriNet's ability to capture market share over the medium term. Forward-looking statements are often identified by the use of words such as, but not limited to, "ability," "anticipate," "believe," "can," "continue," "could," "estimate," "expect," "guidance," "impact," "intend," "may," "plan," "predict," "project," "seek," "should," "strategy," "target," "value," "will," "would" and similar expressions or variations. Examples of forward-looking statements include, among others, ability to manage our expenses diligently; the impact of, and our ability to continue to execute, our business strategy; our ability to continue meeting customer satisfaction; and the extent to which we are able to capture our share of the available market. These statements are not guarantees of future performance but are based on management's expectations as of the date hereof and assumptions that are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from our current expectations and any past or future results, performance or achievements. Investors are cautioned not to place undue reliance upon any forward-looking statements.
Important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements include: our ability to manage unexpected changes in workers' compensation and health insurance claims and costs by WSEs; our ability to mitigate the unique business risks we face as a co-employer; the effects of volatility in the financial and economic environment on the businesses that make up our client base; our inability to realize or sustain the expected benefits from our business realignment initiatives; loss of clients for reasons beyond our control and the short-term contracts we typically use with our clients; the impact of regional or industry-specific economic and health factors on our operations; the impact of failures or limitations in the business systems and centers we rely upon; the impact of discontinuing our discretionary credits on our business and client loyalty and retention; changes in our insurance coverage or our relationships with key insurance carriers; our ability to improve our services and technology to satisfy client and regulatory expectations; our ability to effectively integrate businesses we have acquired or may acquire in the future; our ability to effectively manage and improve our operational effectiveness and resiliency; our ability to attract and retain qualified personnel; the effects of increased competition and our ability to compete effectively; the impact on our business of cyber-attacks, breaches, disclosures and other data-related incidents; our ability to comply with evolving data privacy, AI and security laws; our ability to manage changes in, uncertainty regarding, or adverse application of the complex laws and regulations that govern our business; changing laws and regulations governing health insurance and employee benefits; our ability to keep pace with changes in technology or provide timely enhancements to our solutions and support; risks associated with our international operations; our ability to operate a business subject to numerous complex laws; changing laws and regulations governing health insurance and other traditional employee benefits at the federal, state, and local levels; our ability to be recognized as an employer of worksite employees and for our benefits plans to satisfy all requirements under federal and state regulations; changes in the laws and regulations that govern what it means to be an employer, employee or independent contractor; the impact of new and changing laws regarding remote work; our ability to comply with the licensing requirements that govern our solutions; the failure of third-party service providers performing their functions; the failure to comply with anti-corruption laws and regulations, economic and trade sanctions, and similar laws; the outcome of existing and future legal and tax proceedings; fluctuation in our results of operations and stock price due to factors outside of our control; our ability to comply with the restrictions of our indebtedness and meet our debt obligations; the need for additional capital or to restructure our existing debt; the continuation of our stock repurchase program; the impact of concentrated ownership in our stock by Atairos and other large stockholders; and the anti-takeover provisions in our charter documents and under Delaware law. Any of these factors could cause our actual results to differ materially from our anticipated results.
Further information on risks that could affect TriNet's results is included in our filings with the SEC, including under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and elsewhere in our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, which are available on our investor relations website at https://investor.trinet.com/ and on the SEC website at https://www.sec.gov. Copies of these filings are also available by contacting TriNet Corporation's Investor Relations Department at (510) 875-7201. Except as required by law, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements in this press release, and any forward-looking statements in this press release speak only as of the date of this press release. In addition, we do not assume any obligation, and do not intend, to update any of our forward-looking statements, except as required by law.
Contacts: | |
Investors: | Media: |
Alex Bauer | Renee Brotherton |
TriNet | TriNet |
(510) 875-7201 | (925) 965-8441 |
Key Financial and Operating Metrics
We regularly review certain key financial and operating metrics to evaluate growth trends, measure our performance and make strategic decisions. These key financial and operating metrics may change over time. Our key financial and operating metrics for the periods presented were as follows:
Three Months Ended March 31, | ||||||
(in millions, except per share and Operating Metrics data) | 2025 | 2024 | % | |||
Income Statement Data: | ||||||
Total revenues | $ 1,292 | $ 1,282 | 1 | % | ||
Income before tax | 115 | 124 | (7) | |||
Net income | 85 | 91 | (7) | |||
Diluted net income per share of common stock | 1.71 | 1.78 | (4) | |||
Non-GAAP measures (1): | ||||||
Adjusted EBITDA | 162 | 180 | (10) | |||
Adjusted Net income | 99 | 111 | (11) | |||
Free Cash Flow | 79 | 73 | 8 | |||
Operating Metrics: | ||||||
Insurance Cost Ratio | 88 % | 86 % | 2 | |||
Average WSEs | 340,744 | 348,164 | (2) | % | ||
Total WSEs | 339,625 | 351,919 | (3) | |||
(1) | Refer to Non-GAAP measures definitions and reconciliations from GAAP measures under the heading "Non-GAAP Financial Measures" |
(in millions) | March 31, | December 31, | % | |||
Balance Sheet Data: | ||||||
Cash and cash equivalents | $ 349 | $ 360 | (3) | % | ||
Working capital | 211 | 199 | 6 | |||
Total assets | 3,775 | 4,119 | (8) | |||
Debt | 983 | 983 | — | |||
Total stockholders' equity | 63 | 69 | (9) |
Three Months Ended March 31, | ||||||
(in millions) | 2025 | 2024 | % | |||
Cash Flow Data: | ||||||
Net cash provided by operating activities | $ 95 | $ 91 | 4 | % | ||
Net cash used in investing activities | (8) | (47) | (83) | |||
Net cash used in financing activities | (494) | (243) | 103 | |||
TRINET GROUP, INC. | ||
Three Months Ended March 31, | ||
(in millions except per share data) | 2025 | 2024 |
Professional service revenues | $ 209 | $ 214 |
Insurance service revenues | 1,065 | 1,050 |
Interest income | 18 | 18 |
Total revenues | 1,292 | 1,282 |
Insurance costs | 942 | 907 |
Cost of providing services | 71 | 79 |
Sales and marketing | 67 | 72 |
General and administrative | 46 | 48 |
Systems development and programming | 20 | 18 |
Depreciation and amortization of intangible assets | 17 | 18 |
Interest expense, bank fees and other | 14 | 16 |
Total costs and operating expenses | 1,177 | 1,158 |
Income before tax | 115 | 124 |
Income taxes | 30 | 33 |
Net income | $ 85 | $ 91 |
Other comprehensive income (loss), net of income taxes | 2 | (3) |
Comprehensive income | $ 87 | $ 88 |
Net income per share: | ||
Basic | $ 1.72 | $ 1.80 |
Diluted | $ 1.71 | $ 1.78 |
Weighted average shares: | ||
Basic | 49 | 51 |
Diluted | 49 | 51 |
TRINET GROUP, INC. | ||||
March 31, | December 31, | |||
(in millions, except share and per share data) | 2025 | 2024 | ||
Assets | ||||
Current assets: | ||||
Cash and cash equivalents | $ 349 | $ 360 | ||
Restricted cash, cash equivalents and investments | 1,024 | 1,413 | ||
Accounts receivable, net | 21 | 32 | ||
Payroll funds receivable | 478 | 349 | ||
Prepaid expenses, net | 60 | 64 | ||
Other payroll assets | 881 | 916 | ||
Other current assets | 44 | 46 | ||
Total current assets | 2,857 | 3,180 | ||
Restricted cash, cash equivalents and investments, noncurrent | 134 | 145 | ||
Property and equipment, net | 9 | 10 | ||
Operating lease right-of-use asset | 22 | 24 | ||
Goodwill | 461 | 461 | ||
Software and other intangible assets, net | 146 | 156 | ||
Other assets | 146 | 143 | ||
Total assets | $ 3,775 | $ 4,119 | ||
Liabilities and stockholders' equity | ||||
Current liabilities: | ||||
Accounts payable and other current liabilities | $ 82 | $ 89 | ||
Revolving credit agreement borrowings | 74 | 75 | ||
Client deposits and other client liabilities | 49 | 76 | ||
Accrued wages | 544 | 580 | ||
Accrued health insurance costs, net | 189 | 189 | ||
Accrued workers' compensation costs, net | 45 | 44 | ||
Payroll tax liabilities and other payroll withholdings | 1,645 | 1,906 | ||
Operating lease liabilities | 12 | 13 | ||
Insurance premiums and other payables | 6 | 9 | ||
Total current liabilities | 2,646 | 2,981 | ||
Long-term debt, noncurrent | 909 | 908 | ||
Accrued workers' compensation costs, noncurrent, net | 111 | 110 | ||
Deferred taxes | 10 | 11 | ||
Operating lease liabilities, noncurrent | 24 | 26 | ||
Other non-current liabilities | 12 | 14 | ||
Total liabilities | 3,712 | 4,050 | ||
Total stockholders' equity | 63 | 69 | ||
Total liabilities & stockholders' equity | $ 3,775 | $ 4,119 | ||
TRINET GROUP, INC. | ||
Three Months Ended March 31, | ||
(in millions) | 2025 | 2024 |
Operating activities | ||
Net income | $ 85 | $ 91 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Depreciation and amortization of intangible assets | 17 | 18 |
Amortization of deferred costs | 12 | 11 |
Amortization of ROU asset, lease modification, impairment, and abandonment | 2 | 2 |
Deferred income taxes | (1) | — |
Stock based compensation | 13 | 20 |
Losses on investments | 1 | — |
Loss from disposition of assets | 1 | — |
Other | 1 | 1 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | 1 | (1) |
Prepaid expenses, net | 7 | (14) |
Other assets | (6) | (21) |
Other payroll assets | — | 3 |
Accounts payable and other liabilities | (11) | 24 |
Client deposits and other client liabilities | — | (4) |
Accrued wages | (17) | (28) |
Accrued health insurance costs, net | 1 | — |
Accrued workers' compensation costs, net | 2 | — |
Payroll taxes liabilities and other payroll withholdings | (10) | (7) |
Operating lease liabilities | (3) | (4) |
Net cash provided by operating activities | 95 | 91 |
Investing activities | ||
Purchases of marketable securities | (27) | (95) |
Proceeds from sale and maturity of marketable securities | 34 | 66 |
Acquisitions of property and equipment and software | (16) | (18) |
Proceeds from sale of business | 1 | — |
Net cash used in investing activities | (8) | (47) |
Financing activities | ||
Change in WSE and TriNet Trust related assets and liabilities, net | (388) | (213) |
Repurchase of common stock | (90) | (23) |
Awards effectively repurchased for required employee withholding taxes | (4) | (7) |
Dividends paid | (12) | — |
Net cash used in financing activities | (494) | (243) |
Net change in cash and cash equivalents, unrestricted and restricted | (407) | (199) |
Cash and cash equivalents, unrestricted and restricted: | ||
Beginning of period | 1,691 | 1,466 |
End of period | $ 1,284 | $ 1,267 |
Supplemental disclosures of cash flow information | ||
Interest paid | $ 25 | $ 26 |
Income taxes paid, net | $ — | $ 7 |
Supplemental schedule of noncash investing and financing activities | ||
Cash dividend declared, but not yet paid | $ 13 | $ 13 |
Payable for purchase of property and equipment | $ 1 | $ 3 |
Receivable from sale of business | $ 6 | $ — |
Non-GAAP Financial Measures
In addition to the selected financial measures presented in accordance with U.S. Generally Accepted Accounting Principles (GAAP), we monitor other non-GAAP financial measures that we use to manage our business, to make planning decisions, to allocate resources and to use as performance measures in our executive compensation plan. These key financial measures provide an additional view of our operational performance over the long term and provide information that we use to maintain and grow our business.
The presentation of these non-GAAP financial measures is used to enhance the understanding of certain aspects of our financial performance. It is not meant to be considered in isolation from, superior to, or as a substitute for the directly comparable financial measures prepared in accordance with GAAP.
Non-GAAP Measure | Definition | How We Use The Measure |
Adjusted EBITDA | • Net income, excluding the effects of: - income tax provision, - interest expense, bank fees and other, - depreciation, - amortization of intangible assets, - stock based compensation expense, - amortization of cloud computing arrangements, and - restructuring costs
| • Provides period-to-period comparisons on a • Enhances comparisons to the prior period • Provides a measure, among others, used in • We also sometimes refer to Adjusted |
Adjusted Net Income | • Net income, excluding the effects of: - effective income tax rate (1), - stock based compensation expense, - amortization of intangible assets, net, - non-cash interest expense, - restructuring costs, and - the income tax effect (at our effective tax | • Provides information to our stockholders |
Free Cash Flow | • Net cash provided by operating activities | • Provides information on the strength of our • Provides management with a measure to |
(1) | Non-GAAP effective tax rate is 25.0% for the first quarters and full years of 2025 and 2024, which excludes the income tax impact from stock-based compensation, changes in uncertain tax positions, and nonrecurring benefits or expenses from federal legislative changes. |
Reconciliation of GAAP to Non-GAAP Measures
The table below presents a reconciliation of Net (loss) income to Adjusted EBITDA:
Three Months Ended March 31, | ||
(in millions) | 2025 | 2024 |
Net income | $ 85 | $ 91 |
Provision for income taxes | 30 | 33 |
Stock based compensation | 13 | 20 |
Interest expense, bank fees and other | 14 | 16 |
Depreciation and amortization of intangible assets | 17 | 18 |
Amortization of cloud computing arrangements | 2 | 2 |
Restructuring costs | 1 | — |
Adjusted EBITDA | $ 162 | $ 180 |
Adjusted EBITDA Margin | 12.6 % | 14.2 % |
The table below presents a reconciliation of Net (loss) income to Adjusted Net Income and Adjusted Net Income per share - diluted:
Three Months Ended March 31, | ||
(in millions, except per share data) | 2025 | 2024 |
Net income | $ 85 | $ 91 |
Effective income tax rate adjustment | 1 | 1 |
Stock based compensation | 13 | 20 |
Amortization of intangible assets | 2 | 5 |
Non-cash interest expense | 1 | — |
Restructuring costs | 1 | — |
Income tax impact of pre-tax adjustments | (4) | (6) |
Adjusted Net Income | $ 99 | $ 111 |
GAAP weighted average shares of common stock - diluted | 49 | 51 |
Adjusted Net Income per share - diluted | $ 1.99 | $ 2.16 |
The table below presents a reconciliation of Net cash provided by operating activities to Free Cash Flow:
Year Ended December 31, | ||
(in millions) | 2025 | 2024 |
Net cash provided by operating activities | $ 95 | $ 91 |
Acquisitions of property and equipment and projects in process | (16) | (18) |
Free Cash Flow | $ 79 | $ 73 |
Reconciliation of GAAP to Non-GAAP Measures for the full-year 2025 guidance.
Low and high percentages represent increases (decreases) from the same period in the previous year.
The table below presents a reconciliation of net income to Adjusted Net Income and Adjusted Net Income per share - diluted:
FY 2024 | Year 2025 Guidance | |||
(in millions, except per share data) | Actual | Low | High | |
Net income | $173 | (46) % | (3) % | |
Effective income tax rate adjustment | (5) | (83) | (105) | |
Stock based compensation | 65 | 11 | 11 | |
Amortization of intangible assets | 19 | (49) | (49) | |
Non-cash interest expense | 3 | (100) | (100) | |
Restructuring costs | 49 | (80) | (80) | |
Income tax impact of pre-tax adjustments | (35) | (32) | (32) | |
Adjusted Net Income | $269 | (40) % | (12) % | |
GAAP weighted average shares of common stock - diluted | 50 | |||
Adjusted Net Income per share - diluted | $5.32 | $3.25 | $4.75 | |
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SOURCE TriNet Group, Inc.