Kelly Services, Inc. (KELYB): Business Model Canvas [Dec-2025 Updated]

You're digging into Kelly Services, Inc. (KELYB) to see how this staffing giant is truly positioned in late 2025, and frankly, the recent financials show a company fighting hard on two fronts. While they pulled in $3.2 billion in revenue over the first nine months, the real story is the tightrope walk: managing a massive $741.0 million Cost of Services in Q3 while simultaneously cutting overhead, evidenced by that 9.7% Q3 decline in SG&A expenses. To understand if their strategic shift toward high-margin Science, Engineering, and Technology (SET) talent and government contracts is paying off against macro headwinds, you need to see the whole picture. Below, I've laid out their complete Business Model Canvas, mapping out exactly who they serve, what they charge for, and where the real risks and opportunities lie in their operations.

Kelly Services, Inc. (KELYB) - Canvas Business Model: Key Partnerships

You're looking at the backbone of Kelly Services, Inc.'s (KELYB) operations-the critical relationships that fuel their specialty talent solutions delivery as of late 2025. These partnerships are how they scale expertise across complex sectors.

The scale of Kelly Services, Inc.'s operations is significant, with Q1 2025 revenue reported at $1,164.9 million.

The relationship with major industrial clients is a key indicator of quality. KellyOCG, the outsourcing and consulting group of Kelly Services, Inc., maintains high-level strategic alliances, evidenced by their repeated recognition from major manufacturers.

This Partner-level status is Deere & Company's highest supplier rating, reflecting dedication across quality, delivery, process alignment, value creation, and relationship metrics.

The Education segment relies heavily on deep, localized partnerships with public school systems. Kelly Education positions itself as the nation's #1 provider of education talent.

• Trust established with over 1,000 school districts.
• Supports over 10,000+ schools daily.
• A Florida district achieved a 42 percentage point substitute teacher fill rate lift.
• Awarded $5,000.00 scholarships to future educators in April 2025.

Kelly Services, Inc. supports its global reach through an extensive network. The company operates with a network of suppliers and partners to connect job seekers around the world.

For federal government contracting, Kelly Services, Inc. utilizes established contract vehicles to serve agencies, including the General Services Administration (GSA) Multiple Award Schedule (MAS), which covers Information Technology Professional Services (SIN 54151S) and Technical Consulting Service (SIN 541690) through July 31, 2027.

KellyOCG also maintains an Indefinite Delivery/Indefinite Quantity (IDIQ) contract with the National Institutes of Health (NIH) for IT and professional workforce solutions, with a period of performance running until June 21, 2026.

Finance: draft 13-week cash view by Friday.

Kelly Services, Inc. (KELYB) - Canvas Business Model: Key Activities

The Key Activities for Kelly Services, Inc. center on the high-volume, specialized placement of contingent labor, continuous operational refinement, and strategic integration of acquired capabilities.

Recruiting, screening, and managing a contingent workforce of over 400,000 people annually.

• Kelly Services connects more than 400,000 people with work every year through its network of suppliers and partners around the world.

Executing structural expense optimization and process efficiencies.

The drive for efficiency is reflected in SG&A management and specific charges taken to streamline operations.

• Reported Selling, General, and Administrative (SG&A) expenses in the third quarter of 2025 were $194.4 million.
• This represented a decrease of $24.6 million, or 11.2%, year-over-year for the third quarter of 2025.
• On an adjusted basis, SG&A expenses decreased 9.7% year-over-year in the third quarter of 2025, reflecting momentum on structural cost optimization efforts.

Integrating recent acquisitions like Motion Recruitment Partners (MRP) and Softworld.

Integration activities, particularly for MRP, are a significant ongoing activity, impacting segment reporting and charges.

• The integration of MRP and Softworld in the Science, Engineering & Technology (SET) segment was a factor in the $102.0 million non-cash goodwill impairment charge recognized in the third quarter of 2025.
• The acquisition of MRP in May 2024 contributed to a 11.5% year-over-year revenue increase in the first quarter of 2025, with Q1 2025 revenue at $1.16 billion.
• The initial purchase price for Motion Recruitment Partners, LLC was $425 million, with an additional $60 million contingent on performance criteria by March 2025.
• Softworld was acquired in 2021.

Providing Managed Service Provider (MSP) and Recruitment Process Outsourcing (RPO) solutions.

Kelly Services, Inc. has been actively shifting its revenue mix toward these higher-margin offerings since 2020.

• Management targets margins of 15-20% for RPO and MSP services.
• In 2024, Kelly's Managed Service Provider solutions were available in 70 countries.

Technology modernization to enhance talent acquisition and delivery.

Technology enhancements are directly linked to efficiency drives and are a component of recent restructuring charges.

• Charges recognized in the third quarter of 2025 related to improving technology and processes across the enterprise totaled $4.7 million.
• Technology modernization is explicitly cited as part of the structural expense optimization initiatives.

Here's a quick look at the financial context surrounding these activities as of the third quarter of 2025.

If you're looking at the first nine months of 2025, total revenue was $3.2 billion, up 1.94% year-over-year, but the company reported a net loss of $125.30 million.

Finance: draft 13-week cash view by Friday.

Kelly Services, Inc. (KELYB) - Canvas Business Model: Key Resources

The Key Resources for Kelly Services, Inc. as of late 2025 are built upon a long-standing foundation, specialized delivery capabilities, and strategic capital deployment.

Established Global Brand and Reputation

Kelly Services, Inc. established its global brand and reputation since its founding in 1946, when it invented the staffing industry. The company connects more than 400,000 people with work every year. As of 2024, the company served clients across 30 countries, with its Managed Service Provider solutions available in 70 countries.

Specialized Talent Segments

The core of the current resource base lies in its three specialized talent segments, which are critical for higher-margin expertise. The performance of these segments shows varied strength as of the third quarter of 2025.

• The Education segment showed growth of 5.0% in revenue for the 39-week period ended September 28, 2025.
• The SET (Science, Engineering & Technology) and ETM (Enterprise Talent Management) segments experienced revenue declines in Q3 2025.
• In Q2 2025, the Education segment grew 5.6% reported and 5.3% organically.
• The SET segment's reported revenue grew 19.4% in Q2 2025, largely due to the Motion Recruitment Partners (MRP) acquisition, but its organic revenue declined 8.5%.
• Outcome-based offerings, excluding contact center solutions, were up 2% year-over-year in Q2 2025, driven by ETM.
• Recruitment Process Outsourcing (RPO) and Managed Service Provider (MSP) solutions typically offer margins in the 15-20% range.

Here's a quick look at the segment revenue trends from recent quarters:

KellyOCG for Integrated Talent Solutions

The KellyOCG (Outsourcing & Consulting Group) capabilities are now integrated within the ETM segment, which combines the former Professional & Commercial and OCG segments. KellyOCG was recently named the MSP and Services Procurement Leader by Everest Group.

Proprietary Technology Platforms

A key intangible resource is the innovative technology stack, which includes a proprietary talent data integration and predictive analytics platform driven by AI. This technology underpins the combined RPO/MSP offering, positioning Kelly Services among the top five global providers in that space following the MRP acquisition.

Financial Capital for Share Repurchases

The company maintains financial capital to support opportunistic capital allocation. The board approved a share repurchase program authorizing the purchase of up to an aggregate of $50 million of its Class A common stock on November 26, 2024, with the authorization expiring on December 2, 2026. Management stated they expect to be active with Class A share repurchases in Q4 2025, reflecting confidence in the strategy.

Kelly Services, Inc. (KELYB) - Canvas Business Model: Value Propositions

You're looking at how Kelly Services, Inc. delivers value to its clients as of late 2025. It's about providing the right people, in the right specialized areas, at the right time, which is crucial when the macroeconomic environment is shifting, as seen in the Q3 2025 revenue decline of 9.9% year-over-year to $935.0 million.

Access to specialized, high-demand talent in science, engineering, and technology (SET).

Kelly Services, Inc. provides expertise in connecting talent for complex technical roles. This value proposition is supported by the company's focus on high-demand areas like AI talent solutions amid a sluggish labor market. You can see the mixed performance in this area in the recent results:

• The Science, Engineering & Technology (SET) segment experienced a consistent rate of decline in underlying revenue in the third quarter of 2025.
• In the second quarter of 2025, the reported revenue for the SET segment rose 19.4%, but organically, it was down 8.5%.
• Hiring trends for Engineering in 2025 point to high demand for roles like semiconductor engineers, robotics experts, and advanced manufacturing professionals.

Scalable K-12 staffing solutions for reliable classroom coverage.

The Education segment is a resilient area for Kelly Services, Inc., showing consistent positive momentum even when other segments face headwinds. This is your value proposition for reliable classroom coverage:

• The Education segment showed growth in Q3 2025.
• Specifically, Q3 2025 revenue for the Education segment grew 0.9% year-over-year.
• For the second quarter of 2025, the Education business saw revenue increase 5.6% on a reported basis and 5.1% organically.

Workforce outsourcing and consulting (OCG) to manage complex talent supply chains.

Through its OCG services, Kelly Services, Inc. helps manage broader talent needs, which is part of the Enterprise Talent Management (ETM) division. The focus here is on scaling higher-margin solutions. The company is committed to scaling services like Recruitment Process Outsourcing (RPO) and Managed Service Provider (MSP) solutions, which typically offer margins in the 15-20% range. Still, the ETM segment saw a modest decline in Q3 2025 revenue.

Here's a quick look at how the key segments performed in Q3 2025 compared to the prior year:

Flexibility for customers to align workforce size with demand shifts.

Kelly Services, Inc. offers the ability to adjust staffing levels to match fluctuating client demand. This is evident in how clients manage their workforce in the current environment. The underlying revenue decline of approximately 2.0% in Q3 2025, when excluding discrete impacts from federal contractors and large customers, is noted as being in line with industry performance, suggesting clients are taking a measured approach to hiring. You can quickly scale up or down the team you need for revolving projects.

Global reach with local market expertise for talent solutions.

Kelly Services, Inc. has a broad footprint, which allows for local expertise backed by global scale. The company connects over 400,000 people with work annually. This reach spans across 30 countries for general staffing, and its Managed Service Provider solutions are available in 70 countries. You can access tailored solutions by visiting your country's specific website. Finance: draft 13-week cash view by Friday.

Kelly Services, Inc. (KELYB) - Canvas Business Model: Customer Relationships

Dedicated account management for large, strategic customers is paramount, especially as Kelly Services navigates a dynamic operating environment where Q3 2025 revenue saw a 9.9% year-over-year decrease, partially due to reduced demand from certain large customers. The focus on high-touch relationships is evident in resilient areas; for instance, the Education segment, which relies on strong local ties, delivered organic revenue growth of 6.3% in Q1 2025.

The high-touch, consultative approach is most pronounced in complex contracts like Recruitment Process Outsourcing (RPO) and Managed Service Provider (MSP) solutions, areas management is scaling due to their higher profitability. These specialized services typically offer gross margins in the range of 15-20%. Kelly Services is actively working to enhance execution and agility to drive profitable growth, as stated by the new CEO in Q3 2025.

The long-term partnership focus is clearly exemplified by KellyOCG + Sevenstep. This division received the Morton Long-Term Partnership Award at the 2025 TIARA Talent Solutions Awards - US, recognizing a relationship spanning at least five years.

This specific, award-winning RPO relationship is with a Fortune 10 global healthcare enterprise and has been active since 2019. The scope of this partnership is substantial, supporting the client across 25 business segments and three brands, and handling approximately 10,000 hires annually. Furthermore, KellyOCG + Sevenstep ranked No. 1 in size of deal and third overall out of 58 providers evaluated in HRO Today's 2025 RPO Baker's Dozen Customer Satisfaction Ratings, based on feedback from 335 client companies.

Here's a snapshot of the scale and recognition associated with Kelly Services' high-touch consultative offerings as of late 2025:

Digital self-service tools are being integrated to enhance both client and worker experience, supporting the goal of making work accessible. Kelly Services connects over 400,000 people to work annually, a process increasingly supported by technology. The company is embedding AI contextually into the actual Software as a Service (SaaS) applications used daily, such as Bullhorn or Workday, moving beyond a separate AI website interface. This modernization effort aims to streamline processes that previously consumed significant recruiter time; for example, recruiters were spending over 60% of their time in Outlook before system rationalization. To give you a sense of industry preference, research indicates that 60% of customers opt for self-service tools for simple tasks over speaking with live representatives.

• AI interface named 'Grace' built internally to support employees.
• AI-driven tools are projected to reduce hiring time by approximately 20%.
• Kelly Services connects over 400,000 individuals with employment opportunities annually.

Kelly Services, Inc. (KELYB) - Canvas Business Model: Channels

You're looking at how Kelly Services, Inc. gets its specialized talent solutions and services to clients across the globe. The channels here are less about a single storefront and more about a vast, interconnected operational footprint and digital presence.

The global network of physical and virtual offices/operations spans more than 40 countries, covering the Americas, AsiaPacific, Europe, the Middle East, and Africa. The company's head office remains in Troy, Michigan, USA. This physical presence supports a massive scale, connecting over 400,000 people with work every year.

Kelly Services structures its delivery through specialized business units, which act as distinct channels for different client needs. The company operates through Professional & Industrial, Science, Engineering & Technology (SET), Education, and Outsourcing & Consulting (OCG). Here's a look at the revenue scale and profitability metrics for the most detailed segments as of the third quarter of 2025:

The KellyOCG (Outsourcing & Consulting Group) channel focuses on enterprise solutions, managing the entire talent supply chain for large clients. This group, operating as KellyOCG + Sevenstep for permanent hiring outsourced solutions, is a major player in this space.

• KellyOCG + Sevenstep ranked No. 3 overall out of 58 providers evaluated in HRO Today's 2025 RPO Baker's Dozen Customer Satisfaction Ratings.
• The business ranked No. 1 in size of deal in the same 2025 survey.
• The 2025 HRO Today survey was completed by 335 client companies.
• KellyOCG maintains four regional delivery centers to support its Managed Service Provider (MSP) programs and enact economies of scale.
• KellyOCG was named a Leader on Everest Group's 2025 PEAK Matrix for both Contingent Workforce Management (CWM) / MSP and Services Procurement / Statement of Work (SOW).

Digital job boards and proprietary talent platforms form the crucial virtual layer of Kelly Services' channels. While specific public metrics on digital job board traffic aren't detailed in the latest reports, the company relies on proprietary technology, such as the Talent Unbounded consulting service and Sevayo Insights data integration and predictive analytics technology, to connect talent and drive strategies within its OCG solutions. The company is actively focused on technology modernization and process efficiencies to enhance these digital delivery methods.

Finance: review the Q4 2025 outlook for revenue decline projections by Friday.

Kelly Services, Inc. (KELYB) - Canvas Business Model: Customer Segments

You're looking at who Kelly Services, Inc. is actually selling to right now, late in 2025. It's not a single group; it's a mix of big corporations needing complex outsourcing and specialized talent in niche fields. Honestly, the recent results show some segments are holding up better than others in this market.

The company's focus remains on its specialty areas, which are the Science, Engineering & Technology (SET), Education, and the Outsourcing & Consulting Group (OCG) areas, which handle those large enterprise needs like Managed Service Provider (MSP) and Recruitment Process Outsourcing (RPO) services. The general staffing side, which often serves small-to-midsize businesses (SMBs) with temporary needs, is part of the broader mix, though the recent financial focus has been on the specialties.

Here's a quick look at how the key segments performed in the third quarter of 2025, based on the latest reported figures:

The reliance on large customers is clear, but it also introduces volatility. Discrete impacts from reduced demand from U.S. federal government contractors and from three large private sector customers drove approximately 8% of the year-over-year revenue decline in Q3 2025. This shows a concentration risk in that part of the customer base.

For the high-skill sectors, the picture is mixed, but the focus remains there. You can see the segment performance in the table above, but to be fair, the SET segment, while declining in Q3 2025, showed the strongest reported growth in Q2 2025 at 19.4%, largely due to the MRP acquisition.

The Education segment is a consistent performer, showing modest growth in Q3 2025, continuing a streak. In the preceding quarter (Q2 2025), this segment saw reported and organic growth of 5.6% and 5.3%, respectively. This contrasts sharply with the overall company organic revenue decline of 3.3% in Q2 2025.

For the broader professional and industrial staffing needs, which often serve SMBs, the performance is bundled into the ETM segment, which experienced a significant reported revenue drop of 13.1% in Q3 2025. The company is actively managing this by focusing on expense optimization.

Kelly Services, Inc. connects more than 400,000 people with work every year through its network. This scale suggests a massive underlying customer base, even if the largest revenue drivers are concentrated in the enterprise and government sectors.

• The Education segment achieved a 90% fill rate overall in Q3 2025.
• The company maintained a quarterly cash dividend of 7.5 cents per share through Q3 2025.
• Adjusted EBITDA margin for the company overall was 1.8% in Q3 2025.
• For the first nine months of 2025, total revenue was $3.2 billion.

Finance: draft 13-week cash view by Friday.

Kelly Services, Inc. (KELYB) - Canvas Business Model: Cost Structure

You're looking at the cost side of Kelly Services, Inc. (KELYB) as of late 2025, focusing on the third quarter results. The cost structure is heavily influenced by direct labor and associated costs, but significant non-cash charges and ongoing optimization efforts are shaping the current picture.

Cost of Services is definitely the largest component of the cost base. For the third quarter of 2025, this figure stood at $741.0 million. This line item primarily represents the direct costs associated with delivering talent solutions, such as wages and benefits for temporary and contract employees.

Selling, General, and Administrative (SG&A) expenses are under active management. Reported SG&A expenses for Q3 2025 were $194.4 million, which represented a decrease of $24.6 million, or 11.2%, compared to the prior year period. On an adjusted basis, which strips out certain one-time items, the SG&A expenses saw a year-over-year decline of 9.7%. This reduction reflects momentum on structural and volume-related cost optimization efforts.

The third quarter of 2025 included a significant non-cash goodwill impairment charge of $102.0 million. This charge was related to reduced demand, the integration of the Motion Recruitment Partners, LLC ("MRP") and Softworld acquisitions within the Science, Engineering & Technology (SET) segment, and realignment within that same segment. This single item drove the reported operating loss for the quarter.

Here's a quick look at how reported and adjusted SG&A compare, showing the impact of specific charges:

The pursuit of efficiency is tied directly to strategic investments and restructuring activities. Kelly Services, Inc. is actively working to manage costs associated with its evolving operating model. These efforts include:

• Technology investment and modernization costs, including leveraging Artificial Intelligence to drive process efficiencies.
• Integration and realignment costs from recent acquisitions, such as MRP, which are critical to realizing full value.
• Charges recognized in the quarter related to realignment and acquisition integration totaled $4.7 million.

The push for efficiency is evident across segments, though not uniformly. For instance, while expenses increased in the Education segment to support its revenue growth, expenses decreased across the rest of the company as part of the optimization drive. The SET segment expanded margins by 60 basis points year-over-year due to its expense optimization efforts, even with lower gross profit.

The company's reported loss per share of $4.26 in Q3 2025 included the impact of both the goodwill impairment and a $69.7 million valuation allowance established against deferred tax assets, both non-cash items excluded from adjusted results. Finance: draft 13-week cash view by Friday.

Kelly Services, Inc. (KELYB) - Canvas Business Model: Revenue Streams

You're looking at how Kelly Services, Inc. (KELYB) actually brings in the money as of late 2025. It's all about the mix of talent solutions they provide, and honestly, the numbers show a company navigating some tough demand environments while leaning on specific growth areas.

The top-line number for the first nine months of 2025 is clear: Kelly Services generated total Revenue from services of $3.2 billion (specifically, $3,140.7 million for the 39-week period ended September 28, 2025). This represented a 1.9% increase compared to the same period in 2024, largely due to the May 2024 acquisition of Motion Recruitment Partners (MRP). On an organic basis, revenue was actually down 4.2% for those nine months.

The way this revenue breaks down by the type of service is where you see the core of the business model. While we don't have the full nine-month breakdown across all three segments (ETM, SET, Education) for every service type, the data for the Enterprise Talent Management (ETM) segment gives us a concrete look at how they monetize different offerings:

This ETM breakdown shows that traditional temporary staffing placements are still the largest single component within that segment, bringing in $800.4 million for the first nine months.

When you look specifically at fees from permanent placement and direct-hire services, the total for the first quarter of 2025 was $11.5 million, up 43.2% from $8.0 million in Q1 2024. The ETM segment alone contributed $7.3 million to this in the first nine months of 2025.

The Outsourcing & Consulting Group (OCG) contracts, which include Managed Service Provider (MSP) and Recruitment Process Outsourcing (RPO) work, are represented in the data by the 'Services' line item, which totaled $362.5 million in the ETM segment for the nine-month period. Management also specifically highlighted growth in 'payroll process outsourcing in ETM' during Q2 2025, showing this area is a focus for revenue generation.

The Education segment is definitely a bright spot, showing continued growth even as other areas faced headwinds. For the third quarter of 2025, this segment posted a reported revenue growth of 0.9% year-over-year. Looking back, Q2 2025 saw reported growth of 5.6%, and Q1 2025 saw reported growth of 6.6%. This segment's resilience is a key part of the revenue story for Kelly Services, Inc. in 2025. You should track the Education segment's organic growth rate closely, as it's one of the few areas showing positive momentum.

Here's a quick look at the segment revenue performance for Q3 2025, which impacts the overall revenue mix:

• Enterprise Talent Management (ETM) segment revenue declined 13.1% year-over-year in Q3 2025.
• Science, Engineering & Technology (SET) segment revenue declined 9.0% year-over-year in Q3 2025.
• Education segment revenue grew 0.9% year-over-year in Q3 2025.

Finance: draft a sensitivity analysis on the impact of a further 5% organic decline in ETM revenue for the full year 2025 by next Tuesday.