Resources Connection: AI Is Crushing Turnaround Hopes (Rating Downgrade)

Impact · against what's priced in

RGP is facing a structural decline as AI replaces billable hours, leading to a sharp revenue drop of 18.4% and a swing to negative EBITDA. The shift from cyclical weakness to permanent disruption threatens the dividend and suggests a lower long-term valuation multiple.

RGP−0.80

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In context

The company's Q1 FY27 revenue fell 18.4% to $98.1M with a widening net loss of $8M, driven by AI-driven disruption in core consulting and on-demand talent segments.

Read from the article alone

• ai
• earnings
• RGP
• cash burn
• consulting
• downgrade
• professional services
• revenue decline

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