SThree Reports 8% Drop in Q1 Net Fees; CFO to Step Down

Global STEM recruitment firm SThree reported that net fees declined 8% year over year in constant currency for the fiscal first quarter ended 28 February 2026, with total net fees reaching £71.7 million. Despite the decline, the company noted signs of stabilisation, supported by continued growth in the United States and Japan.

The 8% decline marks an improvement compared to the 15% drop reported in the previous year, suggesting that market conditions may be stabilising. The company stated that trading conditions remained largely unchanged from the previous quarter, with new business activity and contract renewals performing in line with expectations.

Contract staffing, which accounted for 83% of total net fees, declined 10% year over year, while permanent recruitment remained flat during the quarter.

CEO Timo Lehne said the company’s first-quarter performance was in line with expectations, highlighting stable business performance and encouraging momentum in key markets such as the US and Japan. He also noted that consistent new business performance despite a lower sales headcount reflected improved productivity and operational efficiency.

The company added that its fiscal 2026 cost optimisation programme is progressing as planned, with costs weighted toward the first half of the year and savings expected to materialise in the second half. SThree confirmed that full-year performance is expected to remain in line with its previously announced profit before tax guidance of approximately £10 million.

CFO to Step Down

Separately, SThree announced that CFO Andrew Beach will step down from his role and from the board following the company’s annual general meeting on 29 April 2026. He will remain with the company until 21 July 2026 to support a smooth transition.

Damian Fehrenberg, currently Senior Vice President of Finance USA, will take over as interim CFO from 30 April 2026 while the company searches for a permanent replacement with the support of external consultants.

Andrew Beach stated that he was proud of his time at the company, highlighting achievements such as strengthening the company’s financial foundation, improving operational efficiency, and successfully implementing the Technology Improvement Programme.

CEO Timo Lehne thanked Beach for his contribution since joining in 2021 and noted that his work helped build a strong operational and financial foundation for the company’s future growth.

Regional Performance Overview

Regionally, performance varied across markets. The DACH region reported a 13% decline in net fees, while the Netherlands (including Spain) saw a 23% decline and the Rest of Europe fell 14%. In contrast, the USA recorded 8% growth and the Middle East & Asia region grew 27%, helping offset declines in European markets.

The company also reported that group headcount decreased by 4% compared to the end of the previous financial year, reflecting careful hiring decisions, natural employee turnover, and ongoing cost optimisation measures.

Outlook

SThree stated that its business remains aligned with long-term demand for STEM talent and is supported by a strong balance sheet and scalable operating platform. While macroeconomic uncertainty and geopolitical factors continue to impact business confidence, the company said it remains cautiously optimistic about the future.

The company’s focus for the remainder of 2026 will be on maintaining operational efficiency, managing costs, and capitalising on growth opportunities in key international markets.