Welcome to the Robert Half Q3 2023 Conference Call. Today's conference is being recorded. If you'd like to ask a question during the Q&A portion of the call, please press star and the number 1 on your telephone keypad. Our hosts 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 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. Reconciliations and further explanations of these measures are included in a supplemental schedule to our earnings press release. Our presentation of revenues and the related growth rates for each of our contract functional specializations includes inter-segment revenues from services provided to Protiviti in connection with the company's blended Talent Solutions and consulting operations. This is how we measure and manage these businesses internally. The combined amount of inter-segment revenues with Protiviti is also separately disclosed. For your convenience, our prepared remarks for today's call are available in the investor center of our website, roberthalf.com. We delivered above consensus, top and bottom line results for the Q3, notwithstanding the ongoing macroeconomic uncertainty that lengthens both client and job candidate decision cycles. Both Talent Solutions and Protiviti exceeded expectations. Gross margins remained strong due to pricing discipline and the ongoing benefit from the rising mix of revenues from higher skilled services. Our operating cost base also benefited from the targeted actions we've taken to align costs with revenues. We remain confident both in our ability to weather the current climate and in our future growth prospects as the macro landscape improves. For the Q3 of 2023, company-wide revenues were $1.564 billion, down 15% from last year's Q3 on a reported basis, and down 14% on an as adjusted basis. Net income per share in the Q3 was $0.90, compared to $1.53 in the Q3 a year ago. Cash flow from operations during the quarter was $176 million. In September, we distributed a 48-cent per share cash dividend to our shareholders of record for a total cash outlay of $51 million. Our per share dividend has grown 11.4% annually since its inception in 2004. The September 2023 dividend was 11.6% higher than in 2022. We also acquired approximately 1.2 million Robert Half shares during the quarter for $90 million. We have 11.5 million shares available for repurchase under our board-approved stock repurchase plan. Return on invested capital for the company was 24% in the Q3. Now I'll turn the call over to our CFO, Mike Buckley. Thank you, Keith, and hello, everyone. As Keith noted, global revenues were $1.564 billion in the Q3. On an as adjusted basis, Q3 Talent Solutions revenues were down 17% year-over-year. US Talent Solutions revenues were $823 million, down 20% from the prior year's Q3. Non-US Talent Solutions revenues were $260 million, down 7% year-over-year on an as adjusted basis. We have 319 Talent Solutions locations worldwide, including 89 locations in 18 countries outside of the United States. In the Q3, there were 63.1 billing days, compared to 64.3 billing days in the same quarter one year ago. The Q4 of 2023 has 61.1 billing days, compared to 61.2 billing days during the Q4 of 2022. Currency exchange rate movements during the Q3 had the effect of increasing reported year-over-year total revenues by $13 million, $10 million for Talent Solutions and $3 million for Protiviti. Contract Talent Solutions bill rates for the Q3 increased 4.6% compared to one year ago, adjusted for changes in the mix of revenues by functional specialization, currency, and country. This rate for the Q2 was 6%. Now let's take a closer look at results for Protiviti. Global revenues in the Q3 were $481 million. $386 million of that is from business within the United States, and $95 million is from operations outside of the United States. On an as adjusted basis, global Q3 Protiviti revenues were down 5% versus the year ago period. US Protiviti revenues were down 6%, while non-US Protiviti revenues were down 2%. Protiviti and its independently owned member firms serve clients through a network of 89 locations in 29 countries. Turning now to gross margin. In Contract Talent Solutions, Q3 gross margin was 39.8% of applicable revenues, versus 39.4% in the Q3 one year ago. Conversion revenues, or contract to hire, were 3.5% of revenues in the Q3, compared to 4.1% of revenues in the quarter one year ago. Our Permanent Placement revenues in the Q3 were 12.9% of consolidated Talent Solutions revenues, versus 13.8% in the same quarter one year ago. When combined with contract Talent Solutions gross margin, overall gross margin for Talent Solutions was 47.5%, compared to 47.8% of applicable revenues in the Q3 last year. For Protiviti, gross margin was 26.2% of Protiviti revenues, compared to 30.5% of Protiviti revenues one year ago. Adjusted for deferred compensation related classification impacts, gross margin for Protiviti was 25.6% for the quarter just ended, compared to 30% last year. Moving on to SG&A. Enterprise SG&A costs were 31.8% of global revenues in the Q3, compared to 29.9% in the quarter one year ago. Adjusted for deferred compensation-related classification impacts, enterprise SG&A costs were 32.5% for the quarter just ended, compared to 30.6% last year. Talent Solutions SG&A costs were 39.3% of Talent Solutions revenues in the Q3, versus 35.3% in the Q3 of 2022. Adjusted for deferred compensation-related classification impacts, Talent Solutions SG&A costs were 40.4% for the quarter just ended, compared to 36.3% last year. The lower mix of Permanent Placement revenues this quarter versus one year ago, had the effect of decreasing the quarter's adjusted SG&A ratio by 0.5 percentage points. Q3 SG&A costs for Protiviti were 14.7% of Protiviti revenues, compared to 16% of revenues last year. Operating income for the quarter was $144 million. Adjusted for deferred compensation-related classification impacts, combined segment income was $130 million in the Q3. Combined segment margin was 8.3%. Q3 segment income from our Talent Solutions divisions was $78 million, with a segment margin of 7.2%. Segment income for Protiviti in the Q3 was $52 million, with a segment margin of 10.9%. Our Q3 tax rate was 30%, up from 20%-26% for the same quarter one year ago. The higher tax rate for 2023 can be attributed to an increased impact from nondeductible expenses and fewer tax credits. At the end of the Q3, accounts receivable were $941 million, and implied days sales outstanding, or DSO, was 54.2 days. Before we move to Q4 guidance, let's review some of the monthly revenue, revenue trends we saw in the quarter and so far in October, all adjusted for currency and billing days. Contract Talent Solutions exited the Q3 with September revenues down 17% versus the prior year, compared to a 16% decrease for the full quarter. Revenues for the first two weeks of October were down 17% compared to the same period last year. On a week-on-week sequential basis, the rates of decline have narrowed over the past 10-12 weeks. Permanent placement revenues in September were down 26% versus September 2022. This compares to a 23% decrease for the full quarter. For the first three weeks of October, Permanent Placemen t revenues were down 24% compared to the same period in 2022. We provide this information so that you have insight into some of the trends we saw during the Q3 and into October. 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 Q4 guidance. Revenues: $1.415 billion-$1.515 billion. Income per share: $0.75-$0.89. Midpoint revenues of $1.465 billion are 15% lower than the same period in 2022 on an as adjusted basis. The major financial assumptions underlying the midpoint of these estimates are as follows: For revenue growth, year over year, as adjusted, Talent Solutions down 15%-20%, Protiviti down 8%-10%, overall down 13%-18%. Gross margin percentage for Contract Talent, 39%-41%, Protiviti, 25%-27%.... overall, 39%-41%. For SG&A, as a percentage of revenues, excluding deferred compensation classification impacts, for Talent Solutions, 39%-41%, Protiviti, 15%-17%, overall, 32%-34%. And for segment income, Talent Solutions, 5%-8%, Protiviti, 9%-12%, and overall, 6%-9%. Tax rate, 27%-28%. Shares, 104.5-105.5 million. 2023 capital expenditures and capitalized cloud computing costs, $80-90 million, with $20-25 million in the Q3. We limit our guidance to Q1. 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. Consistent with prior quarters, job openings remain elevated, unemployment rates remain low, and monthly job gains remain healthy. Macroeconomic forecasts are mixed, and this is reflected in clients continuing hiring caution. Clients are budget sensitive and very selective in their hiring activities, including the approval of new projects. Also, many are maintaining their internal headcounts based on the anticipated difficulty in finding suitable replacements. Many times this is funded with a reduction in their contract staff. In addition, job candidates are more reluctant to make career moves, fearing they may become the last in and first out in their new roles. The net result is less churn in the labor market. In Talent Solutions, we continue to strategically invest in services involving higher skilled positions across our practice groups. This carries many advantages: higher bill rates and gross margins, longer assignment lengths, increased client openness to remote talent, more full-time engagement professionals, and less economic sensitivity. The cumulative sequential revenue declines during the first five quarters of the current downturn are less than half what they were compared to the same periods of the dot-com and financial crisis downturns. A significant factor is that, in this improvement, is the relative greater resiliency of higher skilled services. Our current mix of contract revenues from higher skilled positions is over 50%, nearly double the percentage during the dot-com downturn. We expect this positive mix shift to continue. Protiviti's regulatory risk and compliance practice continues to be strong and again, posted significant double-digit revenue growth for the quarter. Internal audit, and to a lesser extent, technology consulting, are being modestly impacted by client budget pressures. Protiviti's pipeline continues to be very strong, although economic conditions are impacting the average deal size and the time it takes to close contracts and begin new engagements. Protiviti continues to compete effectively in the marketplace, and its prospects are very positive. We've weathered many economic downturns in the past, each time emerging to achieve higher peaks. With our current portfolio of talent and Protiviti solutions, we are even more confident about the future. We remain committed 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 confidently compete and grow. Finally, we'd like to thank our employees across the globe for their efforts, which made possible prestigious new accolades in the Q3. Robert Half was honored by Time Magazine as one of the World's Best Companies and by Forbes as one of the World's Best Employers. Just today, we were again recognized as one of Fortune's Best Workplaces for Women. Now Mike and I'd be happy to 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. If you would like to signal with questions, please press star one on your touch-tone telephone. If you would like to remove yourself, please press star two. If you're joining us today using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, that will be star one if you would like to signal with questions, star one. And the first question will come from Andrew Steinerman with J.P. Morgan. Hey, Keith, I'm going to give you kind of a tough question. You know, you know, obviously our, our revenues are down here, but not quite like a, a recession. So, like, what environment would you describe this as? Like, do you feel like the next step could be a mid-cycle slowdown that has recovery that follows? Or does this really feel more pre-recessionary to you? Well, what environment are we in now? We're, we're in an environment where it's just factual that we've had 5 quarters of sequential slowing, and that sequential slowing is about half as what we said of dot-com and Great Financial Crisis as far as the cumulative impact. As an aside, we've done a better job with gross margin, we've done a better job with SG&A, and we've done a better job with operating margins over those same 5 quarters. Now, as to what's next, hard to say. Clearly, on the one hand, economists are getting somewhat more positive. Like last time, Wall Street Journal last week was maybe 53-47, there won't be a recession, but that's still close to 50/50, so there's still a lot of uncertainty to remain. We've long taken the stance that we will not anticipate a downturn in how we manage our costs. They always lag a bit relative to our top line. The same has been true here. We're more focused on having the right kind of dry powder when things get better than optimizing trough margins. The characterization of the current environment, I think for 18 months now, Andrew, economists have struggled, most times have been wrong about what was going to happen. As we said on the call, we are encouraged that during the last 10-12 weeks, our weekly revenues have declined less than that same rate a quarter ago. As an example, from start to finish, this most recent quarter, our weekly revenues are down 2%-3%. Cumulatively, that same statistic last quarter was down 8%-10%. So clearly, the rate of decline has narrowed and/or improved significantly. We're encouraged by that. But how we overall assess what's next, given how bad everybody's guess is, including professionals in the field, not really inclined to make an overall assessment. That makes sense. Thank you so much, Keith. Our next question will come from Mark Marcon with Baird. Hey, good afternoon, and thanks for taking my questions. I want to focus on Protiviti. You mentioned, you know, areas of strength or regulatory risk and compliance practice. I'm wondering: how big is that? And then, you know, the areas where you're seeing some weakness, how would you characterize the size there? And trying to narrow in on, you know, the environment doesn't seem to be getting, you know, that much worse, but we are anticipating, you know, a continued decline at a faster rate here in terms of the guidance for Protiviti revenue. So I'm just trying to put those pieces together and to think that part through. Okay, as to size, Protiviti basically has four major solution areas: regulatory risk and compliance, internal audit, technology consulting, and business process improvement. While they're not all exactly equal orders of magnitude, they're approximately equal. Technology consulting, a little larger. Regulatory risk and compliance, a little smaller. But orders of magnitude, they're in the ballpark of being fairly equal. As far as the guidance, frankly, if you take the average daily or monthly billings in Protiviti for the Q3, and you apply that to the Q4, that has fewer days because not only the holidays, but because of the soft close many clients have around the holidays, you get a 5% or 6% shorter quarter in the Q4, and that's precisely what the revenues are at midpoint projected to decline. And so the intention is pretty stable revenues on a daily basis, if you will, for the Q4. It's just a shorter quarter, and it's an even shorter quarter than we see in Talent Solutions because of the soft closes that extend the number of days of impact. Great. Then, you mentioned the pipeline is strong. How would you compare the pipeline, you know, at this time of the year relative to, say, a year ago? And to what extent, you know, does that portend how next year is going to shape up? And along those lines, wondering if you can give us any sort of color with regards to, you know, campus recruiting and what you ended up doing, you know, new additions from campuses, you know, this summer, and, you know, this is the time of the year when offers are going out for people for next year. How's the size of the recruiting class coming in that will start up next summer? So first on the pipeline, it is growing. It's larger than it was a year ago. However, the velocity of converting pipeline opportunities to close contracts and project starts has slowed. So it's not a matter of demand per se, it's the speed with which, it's the urgency with which that demand gets converted to a project start. Arguably, that portends well for next year. Protiviti feels good about where they are in this journey of 2023. That started with their having to pay, you know, high single- to low double-digit raises to their staff, given how competitive the market was, to what quickly became less than half of the attrition which they typically experience, which put pressure on utilization, which they've managed through quite well. They've taken their operating margins from high 7% in the Q1 to now back to over 10%. We think that's a very positive result, given those conditions, which then segues into campus recruiting. Given the significantly less attrition that they're now seeing, they'll be somewhat more conservative with their campus hires in the coming months than they have traditionally, but they're still doing so. They just finished a pretty sizable intern class, many of which become employees via campus. So still recruiting on campus, but not quite the extent to what they have before, given the significant decline in attrition, which gets to this less churn in the marketplace. That's true across employers, but which is also seen internally ourselves. Great. Thank you. Our next question will come from Josh Chan with UBS. Hi, good afternoon, Keith and Mike. Thanks for taking my questions. I guess, Keith, could you talk about the resilience in the contract talent solutions gross margin? I guess it's been very stable despite kind of a softening environment. I know you mentioned price, pricing and mix, but just kind of want to get your thoughts on whether that kind of can sustain going forward at these levels. Given the tightness of the labor market, we see no reason why we should be discounting pricing. If you have a solid, qualified talent, you shouldn't give it away, and so our pricing has held up there. Our assumption is the labor market remains relatively tight, and that bodes well for pricing. As to mix, we've been on this long-term journey across our practice groups to move up the skill curve, and there is a meaningful gross margin benefit to the higher-level skills versus the more operational level skills. In accounting, operational level skills will be accounts payable, accounts receivable, payroll, general ledger, et cetera, while the higher level skills would start with senior accountants and move up. That migration up the skill curve has been planned and ongoing for several years now. We continue to march in that direction, which includes, by the way, our full-time engagement professionals, which are more prevalent at higher skill levels than at the operational skill levels. We feel great about gross margins, both as to what we've done and as to the outlook. That's good color. Thanks, Keith. For my follow-up, could I ask about the revenue comparisons? You gave the October, first two weeks of October. I guess, given the fact that last year you saw this deceleration in November and December, would you expect that if there is a somewhat stable environment, that the revenue declines would lessen as you go through the Q4? Well, this whole weekly sequential versus quarterly sequential versus year-over-year, it has many moving parts, and it's complicated. That's why for us to understand how we're performing right now, we believe the best thing to look at is how our weekly revenues are progressing on a sequential basis. So the fact that we've had Q3 of sequential declines, by definition, you're going to have negative year-over-year growth rates because you're starting in the hole. But to the, but to the effect that you've flattened out most recently, that's certainly helpful on a year-over-year basis. But you still have the issue of the past Q3 have been down less than what they were a year ago, and so year-over-year... has a lot of moving parts, including what happened a year ago, obviously. How we're doing right now sequentially on a weekly basis is what we think is most indicative of what are market conditions. That's helpful color. Thank you. Thank you both for your time. Our next question will come from Stephanie Moore with Jefferies. Got it. Thank you so much. Appreciate the question. You know, maybe continuing on the last question. As you think about the Q4 and, you know, maybe the trends you started to see at the end of September—I'm sorry, the end of the Q3, maybe in October, any feedback you've been hearing from your clients or customers, any seasonality to think about? I think, you know, we're all just trying to get our heads around where are we in this cycle, and I think this is a cycle where you had a lot of pockets of weakness, you know, whether it's, you know, tech or elsewhere, financial institutions over the last year. Maybe any customer color that you can point to, particularly, you know, towards the end of the Q3 and that you've seen so far going into the Q4 would be helpful. Thanks. Well, I'd say customers are still cautious. That said, it feels like it's beginning to stabilize. The numbers are the numbers, as I just described, from beginning to end, our average weekly has only changed by 2%. That's not much, and that's a lot better than it was 90 days ago. So there are signs of stabilization. Customers still have requirements, still have demands consistent with the fact that job openings in the U.S. are still high, so they still need people. They're just very selective. They're waiting for the perfect person to come along, and they feel like they can be patient, and they have time to do so. But to us, the good news is when you look week by week for several weeks in a row, it looks much better than it did 90 days ago. Absolutely. No, that's crystal clear. Appreciate it. Maybe just switching gears quickly, could you talk a little bit about some of your tech investments? I think you've spent a lot of this call talking about some of the work you've done to kind of enhance your mix. But in terms of maybe some of the other actions within your control, can you talk a little bit about some of those digital and tech investments and kind of the opportunities through 2024? Thanks. Well, so I presume you're talking in part about AI, and we've been very pleased about what AI has done to our recruiting. Kind of interesting, this past quarter, we did a major 3-year back test of the effectiveness of our AI. We randomly chose over 70,000 candidates over the last 3 years, and we tested how accurate our model was in predicting which candidates we placed and which we did not. And the good news is it was highly accurate in making that prediction. And the even better news is that clients gave us higher loyalty scores and had higher response rates where we involved our AI model in the selection process than where we did not. And so that just reinforced what we already believed about our AI as we use it in recruiting. As we said last quarter, we're in the process of customizing a large language model, which we think will further improve our AI. And so we're excited about what it's done for us on the recruiting side. We continue down the path of using AI to help our people in their outreach as to which current customers, which previous customers, which prospects are the most likely to give them an order, when they call. So that's an effort that's ongoing. There are some positive signs on that horizon, but that's much less developed than we are on the candidate recruiting side. So we're excited about our AI, our investment. You know, we were into AI well before AI was in the paper every day, and it's very practical. It leverages data that only we have. We have candidate performance data across millions of assignments that they work for us. We leverage that information, and it's a key portion of our AI, as we now know it. I didn't want to say AI, but you did it for me. Appreciate it. Thanks for the color. We'll take a question from Manav Patnaik with Barclays. Hi, Keith. Thanks for the question. This is Princy Thomas on for Manav. Can you talk about any public sector impacts and exposure from the UAW and other labor strikes for Robert Half? Yeah, so there's very, very, very little impact from labor strikes on Robert Half. Either UAW or the L.A. entertainment-based. Made small impacts, but certainly not enough to move the needle. Gotcha. Switching gears, can you talk about any factors that are influencing your outlook for internal hiring? Well, for internal hiring, we're always looking at the productivity of our existing staff. We've been through a process where based on individual performance, we've had to reduce staff that weren't performing to expectation. That said, we're always in the market for highly talented, experienced staff and would continue to look so. But the point is, given the current environment, we're certainly not aggressively adding to internal staff. We feel good about the dry powder we have and the skill set of the dry powder, which is both sales-oriented and recruiting-oriented. And those are the people that are performing best in this environment. Those are the people that have the best productivity in this environment. We feel like we've got some pretty decent capacity in that way. But we're always on the lookout for great people. Got it. Thank you. Our next question will come from Trevor Romeo with William Blair. Hi, good afternoon. Thanks for taking the questions. One on, on the Talent Solutions business. Could you talk maybe about demand by client industry vertical? Are there any types of clients that are maybe holding up better than others in this environment, or vice versa? Well, on the talent solution side, we're 70% SMB, and so we certainly don't have that many large clients. Financial services on the mid-cap and larger cap on the Protiviti side is holding in there reasonably well, probably down mid-single digits year-on-year, but there's no real industry story per se. Outside of that, it's pretty broad-based, both by geography and by industry. Maybe California, a little more impacted because it's big tech heavy. But there are no major stories there. Okay, understood. Thanks. And then one on Protiviti. You know, I think you mentioned some budget pressure on the internal audit and the tech consulting practices. Just wondering if you could maybe give some more detail on what those conversations with clients look like on consulting projects in particular, since we are kind of approaching the year-end budget cycle for a lot of companies. Well, part of what's happened, particularly in internal audit with our large FSI clients, we've talked about in the past, a lot of what Protiviti does is co-sourcing, where they split the responsibilities with clients as to their internal audit work program. And as clients get more budget-conscious, they allocate more of that work to their internal staff and less to third parties such as Protiviti. I think that environment is expected to continue. But as I said earlier, Protiviti feels like the marketplace is pretty stable as it relates to their services as we speak, and feels pretty good about where they are, including in the budget cycle for the coming year. The Q1 is a big quarter for signing new internal audit contracts, and they're relatively bullish about that. So we feel good. Okay, great. Thank you, Keith. Moving on to Kartik Mehta with Northcoast Research. Good afternoon. Keith, you talked about your ability to maintain pricing, and I'm wondering from a competitive standpoint, if you've seen any change, if there's any pricing competition, at all, or what your competitors might be doing? Well, on the talent solution side, there's always price competition. We've never operate in the absence of price competition. There are local regional firms that always in every part of a cycle try to compete based on price. But given how tight the labor market is, frankly, he or she that has the best candidate wins. And given our brand, given our positioning, we typically can compete quite effectively on quality of talent we can provide, which is also aided by the AI I just talked about. So it's more about candidate quality than price. But that's not to say we don't get undercut every day by a local competitor as to price. On the Protiviti side, I'd say the Big Four... based on how heavily they hired, what their position has been relative to the campus hires that were coming, some of which have been deferred. Some of them have certain locations that have excess capacity, and in those locations, those Big Four firms will get quite competitive as to price. But that's just part and parcel to the environment Protiviti's been operating, and it's been that way for a couple of three quarters. Just on EY, Keith, just, you know, now that they've decided to go another direction, does that help, hurt, or is it neutral, do you think, for Robert Half? I'd say neutral. That helps a little bit. We were already seeing partners, managing directors that weren't happy with how they thought that was going to shake out. The fact that it didn't happen wasn't a surprise, given all the firsthand knowledge that Protiviti MDs had of when Arthur Andersen Consulting split and what the challenges are there. The thing about Ernst & Young, they didn't have a lot of external audit financial services clients where they're conflicted from providing consulting services, so they weren't gonna be freed up in a major way to provide consulting in Protiviti's largest industry group, which is FSI. So it was already not expected to have a huge negative impact for that reason, but the fact that it didn't happen, it's kind of business as usual. Nothing's new, but there is a little more activity with some of their partners, managing directors, that would be interested with Protiviti. I'd say the other thing about the Big Four generally, most have a very young, early retirement practice. I say that because I'm 66 and I would be past their limit. But we're the beneficiary of many of those early retired partners across the Big Four that have many, many productive years left in their careers. Thank you very much. I appreciate it. Our next question will come from Jeff Silber with BMO Capital Markets. Hey, thanks so much. This is Ryan on for Jeff. Over the past couple quarters, there's been a larger delta between the U.S. and international business. Was just curious if you can explain where you're seeing the relative strength internationally? Your observation is correct, and international zone, generally speaking, has outperformed U.S. for several quarters. Most of that's been in Europe. Within Europe, Germany has been the strongest. Belgium has always been solid. It's been good lately. And even the U.K., which gets a fair amount of negative press, for us, the U.K.'s been good. So we continued to have a better quarter year-over-year and sequentially outside the U.S. than in the U.S., which is great. Got it. And then I know you talked about some of the cost actions during the quarter, and I'm sure that's reflected in the SG&A guidance. Just more broadly, can you offer any thoughts on where you are from an expense load going forward? Well, as I said earlier, our overarching goal is not to optimize trough margins, but it's instead to rightsize and have the right kind of capacity when things get better. And we've gone through a process the last several quarters, individually, based on productivity and based on capabilities to rightsize our staff. We've gone through that process. Those savings are reflected in our SG&A. I think this quarter alone, we saved $42 million per quarter relative to a year ago in Talent Solutions. So we'll continue to watch revenues and to the extent we have to make further adjustments based on what plays out, we'll be looking at that. But again, not with the view that there's some magical, trough margin we're not gonna go below, but instead, what's the right thing to do relative to having the capability we want to have as things get better? As we've also said in prior calls, many of the actions clients take during a downturn reduce their capacity, and as soon as things get better, they need capacity, and we're a great source for them to scale their own internal capacity when things get better, for which we need our own internal resources. Our next question will come from Tobey Sommer with Truist. Thank you very much. I'm wondering what growth would look like if this is a mid-cycle slowdown on the other side, if the decline has been half as steep as prior recessions and down periods? Does the upcycle on the other side, you know, does that kind of difference inform what we should expect on the other side? Well, the only reason I would say no to that is, to me, the absolute level of job openings are much, much higher than in the past. So even though it's been half as negative on the downside, those job openings, which are future hires, for which the velocity does speed up when things get better, they're there. So that gives me confidence that just because it's been half as negative going down, it's only going to be half as positive going up. Look at that huge job openings number, which is almost double what it would typically be, coming out of a down cycle. Even with unemployment at these low levels, you think that those jobs, the high level of jobs, sort of can be filled to propel a more aggressive and typical upturn, that has been prior? And so I understand that typically in the early part of an upturn, a major source of candidates for us are those that are between jobs because they were unemployed during a downturn, and clearly, there are fewer of them. But we're not near as concerned about supply, just as during the peak of the last 2-3 years when labor was really tight, you never heard us talking about our growth was constrained because of supply, because we have several levers. We've got a candidate database of 30 million people. We've got AI that can pinpoint a short list of the right candidates to fill those positions with remote work, which remains viable, particularly at upper skills. That expands the candidate base. Maybe more important than everything I've just said, these full-time engagement professionals, there we're recruiting from people that already have a full-time job, and so that's not relying on people that were displaced during a downturn. That's having people switch from their current full-time job to work for Robert Half full-time and be deployed as a contractor. So I'm very bullish on the supply side that as things get better, even though there won't be the traditional tranche of unemployed people for us to rely on for supply, we have alternatives that are just as good, if not better, as we demonstrated the last couple of years. Thanks. I could see one, how has remote job opportunities, how have those trended as a proportion of the jobs that your clients are looking for you to fill, you know, year to date, and how does that compare to 2021, 2022, when it might have been sort of at its height? Without giving firm statistics, we would say it's certainly different at higher skills and lower skill, where much more prevalent at higher skills. Next, we would say the movement has been more between fully remote and hybrid than it has been to totally on site. And so not a lot of movement between totally on site and the others, but there has been a fair amount of movement between remote to hybrid. But if you add remote and hybrid together, another way of saying what I just said is that that's fairly stable, particularly at higher skills. Thank you very much. They still want the flexibility to not come in every day. That hasn't changed. At higher skills, and particularly for project skills, clients still very much accept remote work. Even more so, I would argue, than they do with their own full-time staff. They have a special project. There are very pinpointed high skills that they need for that project. They remain very willing that, that be staffed on a remote basis. That's where those high skills are. Thank you. Our next question will come from George Tong with Goldman Sachs. Hi, thanks. Good afternoon. Your Contract Talent Solutions revenue exited the Q3, down 17%, which was relatively comparable to the full quarter, down 16%. To what extent does your 4Q guide assume stabilization in your various end markets with respect to supply and demand? So our 4Q guide looks at the sequential trends for the Q4 over many years, and that trend line we discount based on the experience of the last few quarters. Since this most recent quarter, the trend line improved. We've reflected that improvement in our Q4 guide. That said, we still significantly discounted what the traditional trend line would be for a typical Q4. And by the way, the Q4, given the shorter number of days due to holidays and for perm placement, the month of December is always volatile. Clients run out of budget. Clients go on holiday. Clients decide to defer hiring until next year. So December perm placement is always variable into how we perform. But by and large, we've reflected some of the improvement that we saw sequentially in the Q3 in our guide for the Q4, but certainly not all of it. Said differently, that weekly sequential stabilization we partially reflected in Q4, not totally reflected. And that's just for conservatism, right? It's for conservatism, and it's because it's the Q4 and because Q4 holiday impacts change, Q4 perm hiring demand changes. Got it. That's helpful. And then in the quarter, you delivered above consensus numbers for revenue and profitability. As you think about internal metrics, what areas of the business surprised you to the upside, and what areas would you call out would be surprises to the downside that you saw in the quarter? I'd say the positive surprise was the improvement in the weekly sequential performance, which was pretty broad-based across our practice groups. You know, on the negative side, the good news is that there were no major negatives in that way, and so I wouldn't call out anything as being of consequence. That was a negative relative to our expectation. The other positive that I mentioned, it was not a total surprise. Protiviti made significant improvements in their segment income over the course of the first Q3. Q1 in the sevens, Q3, double digit again, and kind of given the dynamics of the campus hires coming, the less attrition, the resource management between contractors and full-time staff, I think they did a hell of a job given the hand they were dealt with, maintaining and improving. Their segment margins went up 200 basis points between the second and the Q3, which I think is fantastic. And that's a little better than we expected, but I think it's fantastic. Got it. Thank you. Okay, everyone, that was our last question. Thank you for joining. Thank you. This concludes today's teleconference. If you missed any part of the call, it will be archived in audio format in the Investor Center of Robert Half's website at roberthalf.com. You can also log in to the conference call replay. Details are contained in the company's press release issued earlier today.