Insperity, Inc. (NSP): History, Ownership, Mission, How It Works & Makes Money

Insperity, Inc. (NSP) is a dominant force in the Professional Employer Organization (PEO) space, but with LTM revenue of approximately $6.76 billion, is that scale defintely enough to insulate it from volatile market pressures? You're seeing the headlines about their Q3 2025 reported net loss of $20 million, driven by higher-than-expected healthcare costs, which is a sharp reversal from their year-to-date net income of $26 million for the first nine months of the year. This shift forces a hard look at their core mission-to help businesses succeed-and how their new strategic moves, like the HRScale solution with Workday, will stabilize margins and drive growth beyond the 312,842 average worksite employees they serve.

Insperity, Inc. (NSP) History

You want to understand the foundation of Insperity, Inc. to gauge its strategic resilience, and the story starts with a clear vision for small and medium-sized businesses. The company, originally Administaff, pioneered the Professional Employer Organization (PEO) model, which is essentially co-employing a client's team to handle HR, benefits, and compliance.

This history isn't just a timeline; it's a blueprint for how they've managed to report a Last Twelve Months revenue of $6.76 billion as of Q3 2025, even while navigating the high-cost volatility of healthcare benefits. That's the kind of scale you defintely need to map against their current challenges.

Given Company's Founding Timeline

Year established

Insperity, Inc. was established in 1986, positioning itself early in the nascent professional employer organization (PEO) industry.

Original location

The company was founded in Kingwood, Texas, where its principal executive offices are still located today.

Founding team members

The company was founded by Paul J. Sarvadi, who has since served as a long-standing leader, guiding its strategic vision and evolution.

Initial capital/funding

Insperity launched with founder's capital, later securing significant funding through its 1997 Initial Public Offering (IPO) on the NYSE, which raised approximately $35 million to fuel national expansion.

Given Company's Evolution Milestones

Given Company's Transformative Moments

Insperity's trajectory has been defined by two major strategic pivots: the shift from a niche PEO to a broad business performance partner, and a recent, critical investment in next-generation technology to secure its future market position.

• The Rebranding Catalyst: The 2011 move from Administaff to Insperity was more than a name change; it was a strategic declaration that the company was moving up the value chain. This allowed them to sell a full suite of services-from performance management to training-not just payroll and benefits, which is a much stickier, higher-margin offering.
• The Worksite Employee Scale: The consistent growth in the average number of worksite employees (WSEEs) paid per month is the true measure of their PEO success. As of the third quarter of 2025, the average paid WSEEs stood at 312,842, a 1.2% increase over the prior year, demonstrating steady client base expansion despite a challenging labor market.
• The 2025 Technology Bet: The strategic partnership with Workday and the development of the HRScale platform is a high-stakes, transformative moment. The company expects to invest approximately $58 million in the Workday partnership for the full year 2025, aiming to drive accelerated growth and profitability starting in 2026.
• Addressing Profitability Headwinds: The most recent challenge, as of November 2025, is managing elevated healthcare costs, which drove a 15% decrease in Q3 2025 gross profit. This led to a significant revision in the full-year 2025 Adjusted Earnings Per Share (EPS) guidance, now expected to range from $0.84 to $1.47, down from earlier forecasts. Here's the quick math: higher-than-expected benefits costs of $20 million in Q3 alone put a serious dent in the bottom line.

The company is taking clear actions, like implementing pricing adjustments and new benefit plan designs, to stabilize the core business while the Workday investment matures. If you want to dig deeper into the ownership structure and market sentiment, check out Exploring Insperity, Inc. (NSP) Investor Profile: Who's Buying and Why?

Insperity, Inc. (NSP) Ownership Structure

Insperity, Inc. is a publicly traded company on the New York Stock Exchange (NYSE: NSP), and its ownership structure is heavily weighted toward large institutional investors, which is typical for a mature, mid-cap firm. This structure means that major strategic decisions are defintely influenced by a handful of massive asset managers.

Insperity's Current Status

Insperity, Inc. is a public corporation, trading under the ticker NSP on the NYSE, which provides transparency through regular SEC filings, but also subjects the stock to market volatility. As of November 2025, the company's market capitalization stands at approximately $1.19 billion, reflecting its position in the Professional Employer Organization (PEO) space. The company's 2024 revenue, cited in recent reports, was a substantial $6.6 billion, showing the scale of its operations in providing human resources and business performance solutions. You can dive deeper into the major players driving the stock's price action here: Exploring Insperity, Inc. (NSP) Investor Profile: Who's Buying and Why?

Insperity's Ownership Breakdown

The company's control is consolidated among institutional investors, with a small but significant portion held by insiders, including the founder. Here's the quick math on who owns the float as of the latest 2025 filings, showing that over nine out of every ten shares are held by professional money managers.

What this estimate hides is the power of the largest institutional holders; for instance, BlackRock, Inc. and Vanguard Group Inc are consistently among the top shareholders, giving them a significant voice in governance matters.

Insperity's Leadership

The company is steered by a seasoned management team, many of whom have decades of tenure, providing stability but also a consistent strategic vision. Paul J. Sarvadi, the co-founder, has been at the helm for nearly four decades. That's a long run.

• Paul J. Sarvadi: Chairman and Chief Executive Officer (CEO). His total compensation for the most recently reported fiscal year was approximately $9.37 million.
• A. Steve Arizpe: President and Chief Operating Officer (COO), overseeing sales, marketing, and client services.
• James D. Allison: Executive Vice President of Finance, Chief Financial Officer (CFO), and Treasurer, managing the company's financial strategy.
• Sean P. Duffy: Senior Vice President of Finance and Accounting and Principal Accounting Officer.
• Christian P. Callens: Senior Vice President, Legal, General Counsel, and Secretary.

This core leadership group, with its deep institutional knowledge, is responsible for executing the strategy that aims to offset margin headwinds and capitalize on new growth initiatives like the HRScale partnership with Workday, which was formally rolled out in November 2025.

Insperity, Inc. (NSP) Mission and Values

Insperity, Inc.'s core mission extends beyond simply managing human resources (HR); it is about driving client business success to foster broader community prosperity. This cultural DNA is grounded in a clear set of values that prioritize integrity, service, and a commitment to excellence for all stakeholders.

To be fair, the company is navigating a challenging period, as evidenced by the revised full-year 2025 adjusted earnings per share (EPS) forecast, which is now expected to be in the range of $0.84 to $1.47, a significant reduction from earlier projections due to factors like higher-than-expected health care claims costs in Q3 2025. Still, their mission provides the long-term anchor.

Here's the quick math: Despite the Q3 2025 net loss of $20 million, the company's focus on service and technology, like its Workday partnership, is expected to stabilize its business model, with a full-year 2025 adjusted EBITDA forecast between $190 million and $245 million.

For a deeper dive into the numbers, you should read Breaking Down Insperity, Inc. (NSP) Financial Health: Key Insights for Investors.

Insperity, Inc.'s Core Purpose

Official mission statement

The company's mission is a clear, dual-pronged statement that connects client service to a larger societal impact, a philosophy that has guided the firm since its founding in 1986.

• Help businesses succeed so communities prosper.

An alternative framing of this mission, often used internally, focuses on the core components of their service delivery model:

• To help businesses succeed through our people, processes, and technology.

Vision statement

Insperity, Inc.'s vision statement is ambitious, aiming for a position of market leadership defined by trust and tangible improvement in both business performance and employee well-being.

• To be the most trusted HR solutions provider, improving businesses and the lives of employees.

This vision reflects their commitment to being a certified professional employer organization (CPEO) that handles critical functions like payroll and benefits administration for over 10,000 businesses with approximately 360,000 worksite employees as of April 2025.

Insperity, Inc. core values

The company's culture is a values-based, people-centric organization that uses these principles to guide decisions, from client onboarding to internal strategy.

• Integrity: Cornerstone of personal and corporate conduct.
• Respect: For the worth of the individual.
• Servant Leadership and Teamwork: Achieving goals through a focus on helping others.
• Commitment to High Standards: The pursuit of excellence in all service offerings.
• Accountability: A means to elevate individual and corporate performance.
• Innovation: A fundamental driver of long-term success, like the new Workday strategic partnership.
• Embracing Change: Seeing change as an opportunity to learn and improve.
• Community Contribution: Giving back to the communities where employees and clients live and work.
• Perseverance: Through an abiding faith and optimism, defintely needed in a volatile market.

Insperity, Inc. slogan/tagline

While the company does not use a single, short tagline in the way a consumer brand might, its operational slogan highlights the value proposition and depth of service.

• No one can rival the breadth and depth of our services or the level of care we provide.

Insperity, Inc. (NSP) How It Works

Insperity operates as a Professional Employer Organization (PEO), which means it enters into a co-employment relationship with small and midsize enterprises (SMEs) to manage their complex human resources (HR) functions. This model effectively shifts the administrative burden and associated employment-related liabilities-like payroll, benefits, and compliance-from the client to Insperity, allowing business owners to focus on core operations.

The company generates its revenue primarily by charging clients a fee, typically calculated on a per-worksite-employee (WSE) basis, for a bundled suite of services and technology. For the full year 2025, Insperity expects to manage an average number of worksite employees between 310,200 and 310,700, with total revenue for the last twelve months (LTM) as of Q3 2025 reaching approximately $6.76 billion.

Given Company's Product/Service Portfolio

Given Company's Operational Framework

Insperity's operational framework is built on a high-touch service model backed by proprietary and partner technology, which is crucial for delivering value and managing risk across its large client base. This structure lets them handle the complexity of HR for thousands of businesses.

Here's the quick math on their core operations: In Q3 2025, the gross profit per worksite employee was $208 per month, but this was pressured by higher-than-expected benefits costs. To be fair, managing a self-funded benefits program for hundreds of thousands of employees is a massive undertaking, and rising healthcare costs-projected to trend between 6.5% and 7.5% for the full year 2025-are a defintely a headwind.

• Co-Employment Model: Insperity becomes the employer of record for tax and benefits purposes, which gives clients access to a large-group benefits package and reduces their regulatory compliance risk.
• Technology Integration: The company is investing heavily in its strategic partnership with Workday, Inc., with an expected investment of approximately $58 million in 2025, primarily for the rollout of the HRScale platform targeting the mid-market.
• Cost Management: Management is actively focused on operational expense management, forecasting full-year 2025 operating expenses to be below 2024 levels by approximately 3%.

Given Company's Strategic Advantages

Insperity's sustained success in the competitive PEO market comes down to a few clear strategic advantages that are hard for smaller players to replicate. They've built a moat around scale and service quality.

• Scale and Buying Power: With a WSE count over 310,000, the company can negotiate superior, cost-effective employee benefits, including health plans, that small businesses could never access on their own.
• High Client Retention: Client retention is exceptionally strong, averaging 99% per month, which demonstrates the sticky nature of the PEO model and the quality of their service delivery.
• Mid-Market Expansion with Workday: The new HRScale joint solution with Workday positions Insperity uniquely to capture the higher-end, more complex mid-market segment, which is a significant growth driver.
• Financial Stability: Despite a revised 2025 Adjusted EBITDA forecast of $119 million to $153 million, the company maintains a strong balance sheet, which is crucial for weathering macroeconomic shifts and funding strategic investments.

Insperity, Inc. (NSP) How It Makes Money

Insperity, Inc. generates its revenue primarily through a Professional Employer Organization (PEO) model, where it enters a co-employment relationship with clients, collecting gross billings that cover both the client's direct employee costs and Insperity's administrative service fee.

The core of the business is this integrated offering, which means the vast majority of the reported revenue is a pass-through of client costs like payroll, benefits, and taxes, while the company's actual profit driver is the much smaller administrative markup.

Insperity's Revenue Breakdown

Insperity's revenue, or gross billings, is dominated by the costs it manages for its clients. The true measure of the company's performance is the gross profit, which is the difference between total revenue and the direct costs of worksite employees (WSEs).

Here's the quick math using the Q3 2025 reported revenue of $1.62 billion and a gross profit of $195 million.

Business Economics

Insperity's economic model relies on two factors: client growth (Worksite Employee or WSEE count) and margin expansion on its administrative fee. The latter is under pressure right now, but the model is built on economies of scale for benefits and a premium service offering.

• Pricing Model: The administrative service fee is typically calculated as a percentage of the client's gross payroll, not a flat fee per employee, which is a key differentiator. This model means Insperity's revenue naturally rises as client employee salaries increase, which is a defintely good hedge against wage inflation.
• Cost Headwind: The biggest near-term risk is the elevated benefits cost trend, specifically healthcare claims. In Q3 2025, higher-than-expected benefits costs drove the gross profit per WSEE down to $208 per month from $247 a year earlier. The full-year benefits cost trend is expected to remain high, around 9.1%.
• Strategic Countermeasures: Management responded by increasing pricing targets and securing a new contract with UnitedHealthcare, which is expected to materially reduce claim costs in 2026. This is a necessary, clear action to protect the core margin.
• New Growth Engine: The strategic joint development initiative with Workday, called HRScale, is a major focus. This new offering positions Insperity for mid-market expansion and is expected to command a premium product fit and higher pricing, creating another lever for margin expansion in 2026.

Insperity's Financial Performance

The company's financial results for Q3 2025, reported in November 2025, show a clear divergence between top-line growth and profitability due to the benefits cost pressure. You can dive deeper into the ownership structure by Exploring Insperity, Inc. (NSP) Investor Profile: Who's Buying and Why?

• Revenue Growth: Q3 2025 revenue was $1.62 billion, a modest 4% increase year-over-year, driven by a 1% increase in the average number of paid WSEEs (to 312,842) and a 3% increase in revenue per WSEE from higher pricing.
• Profitability Shortfall: The company reported a Q3 2025 net loss of $20 million, a significant drop from a net income of $3 million in the prior-year quarter. The operating margin for the quarter was -1.5%.
• Revised 2025 Guidance: Management lowered its full-year 2025 outlook due to the unexpected healthcare cost trend. The midpoint for full-year Adjusted EPS is now projected at $1.16, a sharp decrease from earlier expectations. Full-year Adjusted EBITDA guidance was narrowed to a range of $119 million to $153 million.
• Client Stability: Despite the pricing increases and market volatility, client retention remains strong, averaging 99% per month, which is in line with the prior year. Strong retention is the bedrock of recurring revenue.

Insperity, Inc. (NSP) Market Position & Future Outlook

Insperity, Inc. holds a strong second-place position in the fragmented Professional Employer Organization (PEO) market, but its near-term outlook is overshadowed by persistent healthcare cost inflation. The company's future trajectory hinges on the successful rollout of its new HR technology platform and its ability to effectively manage benefits costs through its revised UnitedHealthcare agreement.

Competitive Landscape

Insperity operates in a highly competitive PEO space, where market share is primarily driven by scale, technology integration, and personalized service. While ADP TotalSource remains the clear market leader, Insperity differentiates itself by focusing on a higher-touch, comprehensive service model for small and midsize enterprises (SMEs).

Opportunities & Challenges

The company's strategic initiatives are clearly aimed at offsetting the primary risk of rising healthcare costs, a challenge that led to a reduced fiscal year 2025 earnings per share (EPS) outlook of $0.84 to $1.47. Here's the quick math on the risk/reward trade-off.

Industry Position

Insperity is a major player in the PEO industry, serving an average of 312,842 worksite employees (WSEs) per month in Q3 2025, a 1.2% increase year-over-year. That's a solid, defintely sticky customer base.

• Scale and Revenue: The company's trailing twelve months (TTM) revenue is approximately $6.75 billion as of 2025, placing it among the largest PEOs.
• Target Market Focus: Insperity is best positioned for larger SMEs, often those with over 150 employees, where its comprehensive, high-touch model and enterprise-grade benefits access are most valuable.
• Technology Catch-up: The HRScale partnership with Workday is a critical move to close the technology gap with digital-first competitors like Rippling and Justworks, which appeal to smaller, tech-savvy clients.
• Profitability Headwinds: Despite strong top-line revenue, the Q3 2025 adjusted earnings per share (EPS) of -$0.20 highlights the immediate pressure from health benefits costs, signaling a need for margin recovery in 2026.

To understand the institutional confidence in this recovery, you might want to check out Exploring Insperity, Inc. (NSP) Investor Profile: Who's Buying and Why?