Global staffing firm Recruit Holdings reported an improving business environment in its fiscal third quarter ended Dec. 31 when compared to the second. Total revenue at the Tokyo-based firm rose 0.5% year over year in the third quarter; that compares to declines of 6.2% in the second quarter and 20.0% in the first.
The company announced earnings on Monday.
Looking just at Recruit’s “HR technology” segment — which includes Indeed and Glassdoor — third-quarter revenue rose 8.8% in US dollar terms. In Japanese yen, the segment was up 4.6% on a reported basis.
The company cited an increased demand for sponsored job advertising.
Hisayuki Idekoba — who led the company’s acquisition of jobs website Indeed in 2012 — is taking over as president, CEO and representative director effective April 1.
| (¥billions) | Q3 2020 | Q3 2019 | % change | Q3 2020 (US$ millions) |
| Revenue | ¥611.5 | ¥608.5 | 0.5% | $5,919.3 |
| Gross margin | 50.1% | 54.0% | ||
| Profit for the period | ¥54.6 | ¥52.7 | 3.6% | $528.5 |
Recruit’s “media and solutions” segment includes nonstaffing publishing businesses. The company noted revenue in this segment rose by 1.1% but was down 15.5% when excluding revenue from a rent assistance program.
Revenue by segment
| (¥billions) | Q3 2020 | Q3 2019 | % change | Q3 2020 (US$millions) |
| HR Technology (Indeed and Glassdoor) | ¥114.5 | ¥109.5 | 4.6% | $1,095.0* |
| Media & Solutions | ¥186.8 | ¥184.8 | 1.1% | $1,808.2 |
| Staffing | ¥316.6 | ¥320.3 | -1.2% | $3,064.7 |
*As reported by Recruit.
Staffing revenue at Recruit fell 1.2% in the third quarter; the decrease was 1.7% when excluding the impact of foreign currencies. Japanese staffing revenue fell by 2.6%, and revenue from staffing operations outside of Japan was up by 0.1% on a reported basis but down 1.0% when adjusted for the impact of currencies.
Staffing revenue
| (¥billions) | Q3 2020 | Q3 2019 | % change | Q3 2020 (US$millions) |
| Staffing (Japan) | ¥142.7 | ¥146.5 | -2.6% | $1,381.3 |
| Staffing (Overseas) | ¥173.9 | ¥173.7 | 0.1% | $1,683.4 |
Guidance
Recruit reported that it expects a challenging business environment in the fourth quarter ended March 31, mainly because of a state of emergency in Japan that began in January as well as restrictions and lockdowns in the US and Europe.
The company expects revenue for the full fiscal year to be down 7.3%.
Revenue in the HR technology segment is projected to rise by 11% in the six months ending March 31, on a US dollar basis. Recruit believes the rebound in recruiting and hiring activity that began in the third quarter will continue.
Revenue for Japanese staffing operations is forecast to fall by 2.5% year over year in the six months ending March 31, while staffing revenue from outside of Japan is expected to fall by 1.5%.
CSI Companies
CSI Cos. is the new brand for The CSI Cos., one of Recruit’s staffing businesses in the US. In addition, CSI announced a new CSI West division for its new locations in Austin, Denver, Salt Lake City and Phoenix.
Share price and market cap
Shares in Recruit hit a new 52-week high during today’s trading session when they reached ¥5,345 (US$50.78), according to FT.com. The company had a market cap of ¥8.72 trillion (US$82.85 billion).