RGP Q4 Revenue Plunges 24%, Adjusted EBITDA Turns Negative; Credit Facility Replaced
RGP sits 37% above its 52-week low of $3.055.
Summary
RGP's Q4 FY2026 revenue fell 24%, and Adjusted EBITDA turned negative. After breaching covenants, the company replaced its credit facility, signaling financial strain.
Key Events · Earnings and Guidance · RGP
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Q4 Revenue Down 24%
Revenue fell to $106.1M from $139.3M a year ago, driven by softer demand in On-Demand Talent and longer consulting sales cycles.
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Adjusted EBITDA Turns Negative
Adjusted EBITDA was $(0.6)M compared to $9.8M profit in Q4 FY2025, as cost reductions failed to offset the revenue decline.
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Credit Facility Replaced After Covenant Breach
RGP was not in compliance with prior credit facility covenants; terminated it on July 13, 2026, and entered a new $30M secured revolving line with PNC Bank on July 15, 2026.
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Full-Year Revenue Down 18%
FY2026 revenue of $452.0M vs. $551.3M prior year; net loss improved to $40.6M from $191.8M, but Adjusted EBITDA fell to $5.0M from $23.5M.
Analysis · RGP · Trade & Services
A 24% year-over-year revenue drop to $106.1 million in the fourth quarter underscores deepening demand weakness, with the top line missing even the prior quarter's subdued pace. More troubling, Adjusted EBITDA swung from a $9.8 million profit a year ago to a loss of $0.6 million, revealing that cost-cutting measures have not kept up with the revenue erosion. Liquidity concerns are heightened by the disclosure that the company was out of compliance with its prior credit facility covenants, forcing a replacement with a smaller $30 million secured line, despite holding $82.4 million in cash. While the dividend was maintained at $0.07 per share, the absence of share repurchases and the drag from ongoing restructuring costs highlight the severity of the downturn.
At the time of this filing, RGP was trading at $4.20 on NASDAQ in the Trade & Services sector, with a market capitalization of approximately $158.3M. The 52-week trading range was $3.06 to $5.95. This filing was assessed with negative market sentiment and an importance score of 8 out of 10.