Dice Parent Company Reports Quarterly Earnings, Misses on Revenue

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Aug 8, 2018

The news for DHI Group — parent company to Dice, ClearanceJobs, and eFinancial Careers — for the second quarter last week was split. Earnings per share of 5 cents were in line with estimates, but revenue of $39.7 million, a 2.3 percent decrease from last year, missed by $570,000.

Newly minted president and CEO Art Zeile was optimistic for his first earning call with the company after taking the helm in April. “I have completed my 100-day review and I am genuinely excited about the prospects for our business. What I have learned over the last three months has confirmed that our strategy for growth is the right one.

“Although competitive pressures are high, market conditions support a business model based on a specialized offering for technology professionals, which plays to our strengths. We are moving aggressively to streamline our business in order to capitalize on this opportunity. We are also carefully managing our profitability and have a strong balance sheet. We are confident that the combination of these factors will enable DHI to deliver superior value to its shareholders over the long term.”

To say competitive pressures are high is an understatement. Dice is fighting a two-front war with spunky startups like CodeSignal on one end and bluechips like Microsoft, which now owns GitHub, on the other. In an environment desperately seeking tech talent, Dice can’t seem to get itself out of the mud and find significant growth. Its stock has languished around $2 per share for over a year. Not even recent hedge fund interest can move the needle.

DHI Group said it believes the high demand for technology professionals and current competitive dynamics will continue. According to the transcript, it expects a gradual abatement in the rate of revenue decline for Dice if current revenue renewal rates are maintained, and slightly slower top-line growth for ClearanceJobs, due to higher year-over-year comparatives and the extremely tight labor market for cleared professionals. It added that eFinancialCareers revenue trends are expected to continue for the near term.

Other highlights from the quarter include:

  • ClearanceJobs reached a record of 37,000 jobs posted on the site during the 2018 second quarter
  • Dice revenues were $23.5 million, an 8 percent decline year over year
  • eFinancialCareers revenues were $8.5 million, up 6 percent year over year
  • ClearanceJobs revenues were $5.1 million, 23 percent higher year over year, the 10th consecutive quarter of greater than 20 percent year-over-year revenue growth

“Both employers and candidates are searching for better solutions,” says Zeile. “Dice must continue to focus on the higher end of the tech professional markets and specialize in hard to find tech professional talents. To do so, we have to invest in the Dice user interface to bring it up to current design standards and offer a better user experience.

“We must also address client retention and expand our base of direct hire clients, both of which are integral to reversing Dice’s revenue decline. However, the good news is that these are all straightforward and addressable issues.”

In addition to client retention issues, Zeile highlighted a focus on targeting direct employers more versus staffing firms. He also said the company needed to do a better job of releasing new features that help it keep up with the competition instead of fixing existing systems, saying “We must have a better balance between new feature delivery and ‘fixing the problem.'”

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