Insperity Cuts FY25 EPS View, Sees Elevated Benefits Cost Trend Environment

Insperity has cut its FY25 adjusted EPS view to $1.81-$2.51 from $2.23-$3.28 and adjusted EBITDA view to $170M-$205M from $190M-$245M. The company has implemented pricing and benefit plan design changes to address the elevated benefits cost trend environment. Insperity has made substantial progress in executing a pricing plan and implementing benefit plan design changes, and is focused on aligning its cost structure with its updated HR solution portfolio strategy.

Insperity Inc. (NSP) has revised its financial outlook for fiscal year 2025 (FY25), reflecting a more challenging environment for benefits costs. The company has updated its adjusted earnings per share (EPS) view to a range of $1.81 to $2.51, down from the previously projected $2.23 to $3.28. Similarly, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) expectations have been lowered to $170 million to $205 million, from the prior range of $190 million to $245 million [1].

The adjustments come as the company continues to address elevated benefits cost trends. Insperity has implemented a pricing plan and made changes to benefit plan designs to mitigate these costs. CEO Paul J. Sarvadi emphasized the company's resilience and focus on accelerating growth and improving profitability in 2026, noting that the updated HR solutions portfolio, including the rebranding of PEO service as Insperity HR 360 and the introduction of Insperity HR Core, is tailored to address specific aspects of human resource management [3].

CFO James D. Allison reported that the company's second quarter EPS was $0.26 and adjusted EBITDA was $32 million, slightly under the low end of the forecasted range. Allison outlined measures to address elevated benefits cost trends, including pricing increases, plan design changes, and ongoing contract negotiations with UnitedHealthcare (UHC) [3].

Looking ahead, Insperity expects operating expenses to decline slightly sequentially in each of the remaining quarters. The company continues to expect worksite employee growth of 1% to 2% over 2024 and forecasts full year adjusted EBITDA in a range of $170 million to $205 million, and adjusted EPS in a range of $1.81 to $2.51 [3].

References:

[1] https://www.rttnews.com/3561021/insperity-inc-q2-earnings-summary.aspx
[2] https://www.marketscreener.com/news/insperity-company-guidance-for-the-third-quarter-and-full-year-2025-ce7c5fd3dd89f025
[3] https://seekingalpha.com/news/4476665-insperity-outlines-2026-profitability-recovery-plan-through-pricing-and-hrscale-launch