DHI Group (DHX) Q3 2026 Earnings Call Transcript

DATE

Wednesday, Nov. 4, 2026

CALL PARTICIPANTS

• Chief Executive Officer - Art Zeile
• Chief Financial Officer - Greg Schippers
• PondelWilkinson - Kelsey Payne

TAKEAWAYS

• Revenue -- $32.2 million, remaining consistent with the year-ago period as growth in ClearanceJobs balanced declines in Dice.
• ClearanceJobs Revenue -- $16.5 million, increasing 18% year over year driven by stronger sales execution and demand for cleared talent.
• Dice Revenue -- $15.7 million, decreasing 13% year over year due to continued renewal pressure among enterprise accounts.
• Total Bookings -- $27.9 million, growing 10% year over year reflecting momentum in the defense sector.
• ClearanceJobs Bookings -- $15.8 million, up 32% year over year, or 15% excluding the impact of the Point Solutions Group acquisition.
• Dice Bookings -- $12.1 million, decreasing 9% year over year, representing a narrowing decline from the 14% drop reported in the second quarter.
• Net Income -- $2.4 million, or $0.06 per diluted share, compared to a net loss of $4.3 million in the prior year quarter.
• Non-GAAP EPS -- $0.10, rising from $0.09 in the third quarter of last year.
• Adjusted EBITDA -- $8.9 million, representing a 28% margin compared to 32% in the year-ago quarter.
• ClearanceJobs Adjusted EBITDA -- $6.7 million, yielding a 41% Adjusted EBITDA margin.
• Dice Adjusted EBITDA -- $4.0 million, yielding a 25% Adjusted EBITDA margin.
• Free Cash Flow -- $5.3 million, increasing 67% year over year supported by disciplined expense management and solid collections.
• CJ Recruitment Package Customers -- 1,764, representing a 2% sequential increase despite a 3% decline year over year.
• Dice Recruitment Package Customers -- 3,452, decreasing 19% year over year as smaller accounts churned in a soft hiring environment.
• CJ Revenue Renewal Rate -- 93%, up from 85% in the third quarter of the prior year.
• Dice Revenue Renewal Rate -- 67%, remaining under pressure from enterprise contract right-sizing.
• CJ Retention Rate -- 111%, increasing from 106% a year ago, reflecting high value delivered to cleared professional recruiters.
• Average Annual Revenue per CJ Customer -- $29,228, up 10% year over year and 3% sequentially.
• Average Annual Revenue per Dice Customer -- $16,399, up 4% year over year.
• Total Debt -- $30 million, a reduction of $2 million from the prior quarter.
• Share Repurchases -- $3.8 million, used to buy back approximately 900,000 shares during the quarter.
• Full-Year Revenue Guidance -- $124 million to $126 million, narrowed from the previous range of $124 million to $128 million.
• Full-Year Adjusted EBITDA Margin Guidance -- 26%, raised from the previous target of 25%.
• Capital Expenditures -- $1.9 million for the quarter, with full-year expectations of $6 million to $7 million.
• Committed Contract Backlog -- $87.5 million, down 7% year over year.

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RISKS

• Schippers warned that "Dice bookings to remain under pressure through the remainder of 2026," although management expects a gradual recovery following customer retention improvements.
• Zeile noted that certain enterprise customers at Dice continue to reduce contract sizes as they align profile access with current recruiting needs, impacting renewal spending levels.

SUMMARY

DHI Group, Inc. (NYSE:DHX) reported stable total revenue for the third quarter as record-breaking performance in its ClearanceJobs segment compensated for ongoing renewal challenges at Dice. Management highlighted that ClearanceJobs achieved its strongest new business booking quarter in its 24-year history, benefiting from increased national security spending and expanding demand from both traditional defense contractors and emerging technology firms. Dice continues to see pressure among enterprise clients right-sizing their contracts, though bookings declines have narrowed for two consecutive quarters. The company raised its full-year profitability outlook while maintaining a disciplined capital allocation strategy that prioritized debt reduction and share repurchases. Strategic focus remains on leveraging AI demand and optimizing the go-to-market approach for mid-market customers.

• CEO Zeile reported that the ClearanceJobs new business team delivered its strongest bookings quarter in the history of the platform, driven by defense technology companies and allied defense firms expanding in the United States.
• Management stated that the Point Solutions Group acquisition, completed earlier in the year, contributed $2 million to both revenue and bookings in the quarter through an hours-worked business model.
• Schippers noted that DHI transitioned its smallest Dice customers to a self-service platform, which generated approximately $100,000 in revenue per month during the third quarter.
• Art Zeile indicated that AI-related initiatives are creating a new layer of demand for technology professionals, stating, "Businesses need engineers who can design, implement, integrate, and maintain AI systems."
• The company reported that 49% of Dice annual recurring revenue is tied to multiyear contracts, which contributes to a long tail of renewal adjustments as larger enterprises right-size their hiring commitments.
• Art Zeile stated, "The record-breaking defense budget is a growth driver for CJ," noting that increased funding for cleared engineers and cybersecurity specialists supports long-term momentum.

INDUSTRY GLOSSARY

• AgileATS: A proprietary applicant tracking system integrated into the ClearanceJobs and Dice platforms to manage candidate workflows.
• ARPU: Average annual revenue per recruitment package customer, a key metric for measuring customer spending levels.
• ClearanceJobs: An online career community specifically for professionals with active U.S. federal security clearances.
• Dice: A technology-focused talent marketplace that uses a skills-based algorithm to connect employers with tech professionals.
• Lightcast: A provider of labor market data used by DHI to monitor technology job posting trends.
• PSG (Point Solutions Group): A technology staffing and consulting firm acquired by DHI to expand its presence in the cleared talent market.

Full Conference Call Transcript

Operator: Please note, this event is being recorded. I would now like to turn the conference over to Kelsey Payne, PondelWilkinson. Please go ahead.

Kelsey Payne: Thank you, operator. Good afternoon, and welcome to DHI Group's third quarter earnings conference call for 2026. Joining me today are DHI CEO, Art Zeile, and CFO, Greg Schippers. Before I hand the call over to Art, I would like to address a few quick items. This afternoon, DHI issued a press release announcing its third quarter 2026 financial results. The release is available on the company's website at dhigroupinc.com. This call is being broadcast live over the internet for all interested parties, and the webcast will be archived on the company's investor relations page. I want to remind everyone that during today's call, management will make forward-looking statements that involve risk and uncertainties.

Please note that except for historical information, statements on today's calls may constitute forward-looking statements within the meaning of the federal securities laws. These forward-looking statements reflect DHI's management's current views on future events and financial performance, and are subject to risks and uncertainties. Actual results may differ materially from the outcomes contained in any forward-looking statements. Factors that could cause these forward-looking statements to differ from actual results include the risks and uncertainties discussed in the company's periodic reports on Forms 10-K and 10-Q, and other filings with the Securities and Exchange Commission. DHI undertakes no obligation to update or revise any forward-looking statement.

Lastly, on today's call, management will reference specific financial measures, including Adjusted EBITDA, Adjusted EBITDA margin, free cash flow, and non-GAAP earnings per share, which are not prepared in accordance with the U.S. GAAP. Information regarding these non-GAAP measures and reconciliations to most directly comparable GAAP measures is available in our earnings release, which can be found on our website at dhigroupinc.com in the investor relations section. I will now turn the conference over to Art Zeile, CEO of DHI Group.

Art Zeile: Thank you, Kelsey, and good afternoon, everyone. We appreciate you joining us today. At DHI, our mission remains straightforward. We help employers connect with highly skilled technology professionals through our two platforms, ClearanceJobs and Dice, each of which plays a critical role in the technology hiring ecosystem. Our exclusive focus on technology occupations, combined with product innovation, creates a durable competitive advantage. Today, approximately 5,000 employers, staffing firms, and recruiting organizations subscribe to our platforms, and roughly 90% of our revenue is recurring. ClearanceJobs is the leading marketplace for professionals with active U.S. security clearances, serving approximately 1,800 customers, including Lockheed Martin, Booz Allen Hamilton, Leidos, Raytheon, and many others.

ClearanceJobs now has more than two million cleared candidate profiles, reinforcing our position as the industry's premier destination for cleared technology talent. Dice is the largest technology-focused talent marketplace in the United States, built over more than 35 years with over eight million technology profiles. Unlike generalized professional networking platforms, Dice organizes talent around more than 100,000 distinct technology skills, allowing recruiters to identify candidates based on the precise capabilities they need. Together, these two platforms have become essential tools for employers seeking highly specialized technology professionals. Our third quarter performance reflects growing momentum at ClearanceJobs, continued progress in narrowing Dice's bookings decline, and strong cash generation.

Although the two businesses are at different points in their growth cycles, we remain focused on serving our customers, managing expenses carefully, and investing in opportunities that create long-term shareholder value. Let me begin with ClearanceJobs, our primary growth engine. ClearanceJobs delivered strong third quarter results, with bookings increasing 32% year-over-year and revenue growing 18%. Excluding Point Solutions Group, bookings increased 15% while revenue grew 4%. The acceleration in our core bookings is particularly encouraging. Following the softer bookings performance we experienced late last year, we strengthened our sales leadership and execution. We are now seeing those efforts reflected in the business, alongside growing demand for cleared talent. As we discussed previously, bookings are a leading indicator of revenue.

Revenue is recognized over the service periods of the underlying contracts, so stronger bookings translates into revenue growth over time, with the pace influenced by contract start dates and renewal performance. The return to double-digit core bookings growth is therefore an encouraging step forward toward the sustained revenue growth we believe ClearanceJobs can deliver. Our new business team had its strongest booking quarter in ClearanceJobs' 24-year history. In addition, our recruitment package customer count increased sequentially, an encouraging development after several quarters of pressure. Together, these results point to stronger demand for the platform and progress in converting that demand into customer relationships. We see several factors supporting this opportunity.

First, our traditional defense contractor customers are responding to increased national security and investment, and the need to staff programs that require cleared engineers, cybersecurity specialists, and other highly skilled professionals. Second, a growing number of defense technology companies are entering this market. These include venture-backed firms and commercial technology companies pursuing government work. As they develop new capabilities and compete for contracts, access to cleared talent becomes increasingly important. Third, European and allied defense companies, such as Saab and BAE Systems, are expanding their presence in the United States, creating additional opportunities for ClearanceJobs. These relationships demonstrate how ClearanceJobs' reach extends beyond traditional U.S. defense contractors.

As established international companies and emerging defense technology firms pursue U.S. opportunities, they need access to professionals with security clearances and specialized skills their programs require. Our established cleared community positions us well to serve that expanding customer base. The defense spending outlook offers an additional potential growth driver. Proposals under consideration for the next fiscal year would represent another significant increase in spending. Final authorization and appropriations bills remain subject to the legislative process, and the timing of funding can affect when customers move forward with hiring. We therefore do not assume the proposed spending translates immediately into bookings.

However, we believe the direction of investment, along with the growing number of employers pursuing defense work, supports a meaningful long-term growth opportunity for ClearanceJobs. Turning to Dice, we are making progress, although the business continues to face renewal pressure. The year-over-year decline in bookings narrowed to 9% in the third quarter, down from 14% in the second quarter and 20% in the first quarter. Our new business sales organization performed well with year-over-year bookings growth in the quarter, providing an encouraging indication of current hiring demand. At the same time, certain enterprise customers continue to reduce the size of their contracts as they align profile access and other purchasing commitments with their current recruiting needs.

In these relationships, the pressure is primarily on spending levels rather than on the loss of the customer relationship. Across Dice, customer attrition remains a factor, although we are seeing less adjustment pressure across our mid-market customer base. Stabilizing customer count and improving renewal performance remain important milestones. The broader technology hiring indicators remain encouraging. The CompTIA and Lightcast data we monitor show technology job postings running about 30% above prior year levels. Although these indicators have not yet translated into a return to growth for Dice, they support our view that demand for specialized technology talent remains substantial. We continue to see AI-related initiatives driving demand for experienced technology professionals.

Businesses need engineers who can design, implement, integrate, and maintain AI systems. The growing use of forward-deployed engineers to help companies implement AI projects also underscores the importance of that expertise. We remain measured about the timing of Dice's recovery. Improving market indicators and new business performance are positive, but enterprise renewal adjustments continue to affect bookings, and revenue reflects those changes over time. We are focused on improving execution, stabilizing customer relationships, and preserving healthy profitability while positioning Dice to benefit as customer demand strengthens. Across DHI, cash generation remains an important strength of our business model. We generated strong free cash flow during the quarter, supported by disciplined expense management and solid collections.

That cash generation enabled us to reduce debt by $2 million, while at the same time repurchasing approximately 900,000 shares for $3.8 million in the quarter. As we look ahead, our priorities are clear. At ClearanceJobs, we are building on the momentum in core bookings and capturing demand from an expanding defense customer base, with a focus on translating that progress into sustained double-digit revenue growth. At Dice, we are focused on customer retention, renewal spending, and new business execution, while maintaining financial discipline and positioning the business to benefit as demand continues to strengthen. With that, I'll turn the call over to Greg to walk through our financial results in greater detail.

Greg Schippers: Thank you, Art, and good afternoon, everyone. I will start with a brief overview of our third quarter results before walking through each of the segments in more detail. While total revenue was stable year-over-year, ClearanceJobs delivered strong revenue and bookings growth, and our results benefited from the actions we have taken to improve efficiency across the business. Importantly, we delivered solid Adjusted EBITDA margin in the quarter along with strong free cash flow generation. Overall, our performance highlights the durability of our subscription-based model, the growth opportunity in ClearanceJobs, and the strong profitability we are seeing in Dice as we position the business for the recovery in tech hiring.

With that context, let us turn to our segment performance, starting with ClearanceJobs. ClearanceJobs revenue was $16.5 million, up 18% year-over-year and up 6% compared to the prior quarter. Bookings for CJ were $15.8 million, up 32% year-over-year. PSG, acquired at the end of February, contributed $2 million of revenue and bookings in the quarter for CJ. Excluding PSG, ClearanceJobs bookings increased 15%, reflecting stronger sales execution and growing demand for cleared talent. We ended the third quarter with 1,764 CJ recruitment package customers, which was down 3% on a year-over-year basis and up 2% on a sequential basis. CJ accounts spending greater than $15,000 in annual recurring revenue increased versus the prior year.

Our average annual revenue per CJ recruitment package customer was up 10% year-over-year and up 3% on a sequential basis to $29,228. For the quarter, CJ's revenue renewal rate was 93%, up from 85% in the third quarter of last year, and CJ's retention rate was 111%, up from 106% a year ago. The solid renewal and retention rates demonstrates the value CJ delivers in the recruitment of cleared professionals. Dice revenue was $15.7 million, which was down 13% year-over-year and flat sequentially. Dice bookings were $12.1 million, down 9% year-over-year. We ended the quarter with 3,452 Dice recruitment package customers, which is down 7% from last quarter and down 19% year-over-year.

Dice revenue renewal rate was 67% for the quarter, and its retention rate was 92%. The reduction in Dice's customer count from the prior year quarter continues to be attributable to churn with smaller customers spending less than $15,000 per year, representing approximately 80% of the total churn on count, and who were more likely to be impacted by the soft tech hiring environment over the past year. We believe the introduction of our new Dice platform, which offers customers the flexibility of monthly subscriptions, will partially offset the churn among smaller accounts by lowering upfront commitment and improving affordability. Our average annual revenue per Dice recruitment package customer was $16,399, up 4% year-over-year and up 3% sequentially.

Deferred revenue at the end of the quarter was $37.3 million, down 9% from the third quarter of last year. Our total committed contract backlog at the end of the quarter was $87.5 million, which was down 7% from the end of the third quarter last year. Short-term backlog was $69.4 million at the end of the quarter, and long-term backlog, that is revenue to be recognized in 13 or more months, was $18.1 million. Both brands onboarded notable clients in the third quarter. For CJ, this includes CISA, Neural Strategic Solutions, Muon Space, and Moog, while Dice landed CSG US Group, Turing Enterprises, and Fertajic as customers. Now, let's move to operating expenses.

For the quarter, our operating expenses decreased $8.2 million, or 22%, to $28.4 million when compared to $36.6 million in the year-ago quarter. Excluding the impairment in the 2025 period, operating expenses increased $1.4 million, primarily due to the Point Solutions Group acquisition. For the quarter, we had income tax expense of $900,000 on income before taxes of $3.3 million. Our tax rate for the quarter differed from our statutory rate due to state income tax expense of $100,000. Although our income subject to tax has grown, the tax law change in 2025, which allows for the immediate deduction of R&D costs, has partially offset our 2026 cash outlay for income taxes.

Moving on to the bottom line, we recorded net income of $2.4 million, or $0.06 per diluted share, in the quarter. For the prior year quarter, we reported a net loss of $4.3 million, or $0.10 per diluted share, which included the impairment charge of $9.6 million. Non-GAAP earnings per share for the quarter was $0.10 per share compared to $0.09 per share for the prior year quarter. Diluted shares outstanding for the quarter were 42.2 million shares, down 2.6 million shares, or 6%, from the prior year quarter, as we returned cash to shareholders through our share repurchase program.

Adjusted EBITDA for the quarter was $8.9 million, a margin of 28%, compared to $10.3 million, or a margin of 32%, a year ago. On a segmented basis, CJ adjusted EBITDA remains strong at $6.7 million in the third quarter, representing a 41% adjusted EBITDA margin, as compared to adjusted EBITDA of $5.9 million, or a margin of 43%, in the prior year period. Dice's adjusted EBITDA remained solid at $4 million, representing a 25% adjusted EBITDA margin compared to $6.2 million and a 34% margin last year. Operating cash flow for the third quarter was $7.2 million compared to $4.8 million in the prior year period.

Free cash flow, which is operating cash flows less capital expenditures, was $5.3 million for the third quarter compared to $3.2 million in the same quarter last year. Our capital expenditures, which consist primarily of capitalized development costs, were $1.9 million in the third quarter compared to $1.6 million in the same quarter last year. Capitalized development costs in the third quarter for CJ were $689,000 compared to $451,000 a year ago, while capitalized development costs for Dice were $887,000 this quarter as compared to $1.1 million a year ago. The CJ increase was primarily related to continued improvements to the AgileATS and premium candidate experience products.

For the full year, we continue to expect total capital expenditures of between $6 million and $7 million compared with $7.3 million last year. From a liquidity perspective, at the end of the quarter, we had $3.2 million in cash and our total debt was $30 million, a decrease of $2 million from the last quarter, despite cash outlays in the quarter of $3.8 million for share repurchases. Leverage at the end of the quarter was 0.86x our Adjusted EBITDA, and we continue to target one times leverage for the business. At the end of the quarter, we had approximately $800,000 remaining on our $10 million share repurchase program. Moving on to guidance, we expect ClearanceJobs bookings growth to continue.

For Dice, while we expect bookings to remain under pressure through the remainder of 2026, we believe the actions we are taking to improve customer retention and sales execution will support a gradual recovery in bookings. We are narrowing our full year 2026 revenue guidance range to $124 million-$126 million from $124 million-$128 million. We expect CJ and Dice each to contribute revenue of $62 million-$63 million for the full year. From a profitability standpoint, we are raising our full year Adjusted EBITDA margin guidance for DHI to 26% from 25%. We are maintaining our CJ margin target at 40% and raising our Dice margin target to 25% from 24%.

Our focus remains on delivering sustainable, profitable revenue growth over the long term, along with strong free cash flow generation averaging at or above 10% of revenues. To wrap up, although the hiring environment over the past few years has impacted our revenue growth, we are optimistic about the road ahead. The record-breaking defense budget is a growth driver for CJ, and for Dice, we are seeing companies across all industries steadily increase their investments in technology initiatives, creating a growth opportunity. We remain focused on strengthening our industry-leading solutions, optimizing our go-to-market strategy, and executing with efficiency, ensuring we are well-positioned to capitalize on the opportunities that lie ahead. With that, let me turn the call back to Art.

Art Zeile: I want to thank all our employees once again for their outstanding work this quarter. It is a pleasure to be part of such a great team. That said, we are happy to answer your questions.

Operator: We will now begin the question-and-answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. The first question comes from Dawson Frisinger from Lake Street Capital Markets. Please go ahead.

Dawson Frisinger: Hey, guys. Thanks for taking my question, and congrats on the results and the strong bookings in ClearanceJobs.

Art Zeile: Thank you.

Dawson Frisinger: You mentioned monthly subscription as a way to offer Dice at a lower, more adjustable price. Can you talk about any traction you're seeing with this offering, and have you noticed any of your existing annual customers transition into the monthly subscription as a different option?

Greg Schippers: Yeah, Dawson, this is Greg. I will take that. Yes, we are seeing traction there. We took our smallest customers, we had a cutoff of roughly $6,500, and we have moved those from a sales-assisted process to a self-service platform. Within that group of customers, we have got about 30% of them that were upsold back into a managed situation with our sales team, and about 20% of those then have, I am sorry, it is 20% of the customers and 30% of the dollars have upsold, and then the others are moving on to that self-service approach to sales. We are seeing some uptick in that.

It has been kind of a gradual over the course of the year here, I would say. During the third quarter, we had about $100,000 of revenue each month, so a little over $300,000 in the quarter from that cohort of customers. It is improving. It is a fairly gradual lift within that group, but it is improving as we kind of fine-tune the marketing for that and build that customer set.

Dawson Frisinger: Great. Yeah, it is definitely good to see some traction going up in Dice. Then kind of on the political side, given the Democrats are getting control of the House and Senate, do you foresee any pressure for reduced spending on the defense side, and how might CJ be impacted? Then historically, have you seen any slowdowns in clearance approvals during congressional shifts from like the Republican to Democratic-controlled party?

Art Zeile: Great question. I am sure it is on everybody's mind. The way that I would answer is that the world did not get any less dangerous last night, unfortunately. The primary, arguably the most important function of government is defense of the nation. It is one of those situations that has actually been a unifying force across the political spectrum in the past. So, I believe, and we do know by looking at these kind of shifts in midterm cycles, that there generally isn't a shift in the posture associated with the defense budget. If you think about what has transpired so far, back in July, the House Appropriations Committee actually cleared the defense bill, H.R.

9495, on a 34 to 27 vote, authorizing about $1.1 trillion of funding. We have done some work in the past, then we went into continuing resolution, which actually results. The end point of the continuing resolution is December 11, so we have a few weeks before that transpires. But again, I just point to the fact that our historical precedent definitely shows that midterm elections generally do not change the posture of defense spending because it is really the external environment that dictates that more than the party in charge.

Dawson Frisinger: Great. No, that is helpful. Thanks again for taking my questions, and congrats again on the results.

Art Zeile: I really appreciate that, Dawson.

Operator: The next question comes from Josh Nichols from B. Riley Securities. Please go ahead.

Josh Nichols: Hi, this is Matthew on for Josh. Thanks for taking my questions. To start off

Art Zeile: Of course.

Josh Nichols: ClearanceJobs bookings were up 32% this quarter, while revenue was up 18%, so that was strong. Just wondering how we should think about that booking strength converting to revenue over the next few quarters and how that sets up 2027.

Greg Schippers: Yeah, good question. A portion of the bookings growth, the 32% growth, came from a Point Solutions Group acquisition, and that was roughly $2 million. That converts, that's bookings and revenue at the same time, based on the nature of that business. So it's not a subscription model, but that's based on an hours worked model, so it converts immediately. But the 15% growth will convert to revenue roughly in six months, is typically how we look at it as it builds. So you'll see, all things the same, that double-digit growth coming up in the first part of next year.

Josh Nichols: Got it. Speaking of Point Solutions, I am just wondering, how is the federal contract bidding opportunity looking for them, and what does the pipeline of prime subcontract work look like heading into the next few months?

Art Zeile: Yeah. I have to say that we hired a new leader for that division. Alyssa has been on board for roughly about two to three months now, and we have already started a relationship with three new primes. I would say that the pipeline is looking very strong and just given the short amount of time that Alyssa has been on board, it is actually pretty exceptional.

Josh Nichols: Great. Great to hear. Last one for me, mainly just on enterprise renewal spending. It seems decently under pressure at Dice. Wondering what you are hearing from those larger customers and what you need to see for that to turn.

Art Zeile: Yeah. I appreciate the question, and I have to say that it is important to understand that in the Dice business model, 49% of our annual recurring revenue is tied to multi-year contracts, two to three-year-long contracts. With these larger enterprises, they made those decisions as to how many profile views they would use that many years ago. They look their utilization rates, and they adjust those, largely downward because there was more optimism a few years ago, and that is what we are experiencing right now. We have seen that the mid-market cohort of customers have actually successfully kind of right-sized their contracts, and we do believe that we can build off of that new contract base.

We are experiencing that now for enterprise customers, and that is really the mechanism for what is happening with our renewal rate today. But we do believe we are going to be working through it. It is kind of hard to say what the timeframe is. There is kind of a long tail, again, associated with those multi-year contracts, but it is in progress. Greg, I do not know if you have anything else to add to that description.

Greg Schippers: Yeah, sure. I would just add that, as I mentioned to an earlier question, those smaller customers that we moved to the self-service, just so you can kind of project out a bit, those renewals will exhaust themselves at the end of this year. So, when you think about customer counts, particularly on Dice, which has gone down, admittedly, that is a big reason for that churn. We have one more quarter of that, and then that will resolve itself into next year, just so you have that perspective.

Josh Nichols: All right, great. That was helpful. I mean, Dice bookings has improved for a second straight quarter, so that is great to hear as well. So yeah, that was all for me. Thanks for taking my questions.

Art Zeile: Thanks, Josh.

Operator: The next question comes from Kevin Liu from K. Liu & Company LLC. Please go ahead.

Kevin Liu: Hi. Good afternoon, guys, and congrats on a nice quarter from you as well.

Art Zeile: Thanks, Kevin.

Kevin Liu: Just wanted to start on the CJ portion of the business. You guys came in a little bit above your guide from a revenue perspective. What was the primary driver of that? How much of that was just tied to the timing of when you got the bookings within the quarter relative to maybe the acquisition contribution or other factors?

Greg Schippers: Yeah. Some of that, a little bit of that was PSG, but otherwise, I mean, we really just did have a good quarter in new business in particular, as I think Art mentioned, our strongest new business quarter we have had in the history of ClearanceJobs. While it takes a little bit of time for that to convert to revenue, it did pop us up a little bit during the quarter, along with that strong retention rate that we talked about, 110% or 111%, on our account management team.

Kevin Liu: Yeah. Just kind of in that vein, just from a booking standpoint and getting to kind of this 15% core growth rate, wondering how much of that is just kind of expansion of your own clients' teams versus you guys being able to upsell perhaps AgileATS or other things as part of that deal?

Greg Schippers: Yeah. That was mostly core on that side. Again, that retention rate and the revenue renewal rate being so strong along with new business, that drove the bookings increase primarily.

Art Zeile: I would also add to that, Kevin, that I do talk to these customers, and they are winning more projects. Because of the need to essentially hire more cleared personnel, they are putting more profile views on their contracts.

Kevin Liu: Yeah. Makes sense. The other question I had on ClearanceJobs was just, you guys have done two acquisitions there fairly recently. Now that they seem to be pretty well integrated, what does the pipeline of opportunity look like? Are there other adjacencies you would like to expand CJ out to?

Art Zeile: Well, we are always looking for those other adjacencies, and in fact, we have actually given a project to a consulting group here in Denver to do a market map of adjacencies for ClearanceJobs. There is not anything that is imminent or on the horizon right now, but I do believe that ClearanceJobs, just because of the unique positioning that it has with its customer base, has the ability to sell more from a menu into that customer base. So yeah, we are thinking the same way you are.

Kevin Liu: Great. And just one on the Dice side of the business as well. As you look at the kind of the new business performance that they are starting to put up, is it strictly concentrated more on the IT staffing side, or are you seeing commercial clients also starting to pick up activity?

Art Zeile: Mostly on the IT staffing side. In fact, I mean, you probably know that the IT staffing sector has rebounded very nicely this year. It was down 10% in 2023, down 6% in 2024, down 3% in 2025. And now, if you look at the Staffing Industry Analysts Bullhorn Indicator, which is a publicly available page, you could look at the amount of revenue in the tech staffing sector that they track and compare it to last year. Roughly speaking, it is up 6%-7% pretty much the entirety of this year. So, that is very, very positive, and we are seeing that in the form of new customer activity for the Dice platform.

Kevin Liu: All right. That is all I had for now. Really appreciate you taking the questions.

Art Zeile: Thank you very much. Greatly appreciate it, Kevin.

Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Art Zeile for closing remarks.

Art Zeile: Well, thank you, Danielle, and thank you all for joining us today. As always, if you have any questions about our company or would like to speak with management, please reach out to Todd or Kelsey, and they will assist you in arranging for a meeting. Thank you, everyone, for your interest in DHI Group, and have a wonderful day and week.

Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

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