Mastech Digital Kicks Off 2026 With Business Realignment
PITTSBURGH, May 15, 2026 /PRNewswire/ -- Mastech Digital, Inc. (NYSE American: MHH) ("Mastech Digital"), a leading provider of Digital Transformation IT Services, announced today its financial results for the first quarter ended March 31, 2026.
First Quarter 2026 Highlights:
Three Months Ended
-------------------------------------------------
March 31, March 31, December 31,
(In thousands,
except per share
data) 2026 2025 2025
--------- --------- ------------
Revenues
Data & AI
Segment $ 12,584 $ 15,997 $ 14,409
Talent Segment 28,499 32,319 31,052
--------- --------- ------------
Consolidated $ 41,083 $ 48,316 $ 45,461
Gross Profit
Data & AI
Segment $ 4,684 $ 6,034 $ 5,902
Talent Segment 6,341 6,858 6,981
--------- --------- ------------
Consolidated $ 11,025 $ 12,892 $ 12,883
Gross Margin
Data & AI
Segment 37.2% 37.7% 41.0%
Talent Segment 22.3% 21.2% 22.5%
--------- --------- ------------
Consolidated 26.8% 26.7% 28.3%
GAAP Net Income
(Loss) $ 264 $ (1,439) $ 972
GAAP Diluted
Earnings (Loss)
Per Share $ 0.02 $ (0.12) $ 0.08
Non-GAAP Net
Income $ 1,281 $ 1,101 $ 2,499
Non-GAAP Diluted
Earnings Per
Share $ 0.11 $ 0.06 $ 0.21
See "Use of Non-GAAP Financial Measures" and "Reconciliation of GAAP Measures to Non-GAAP Measures" below.
Total consolidated revenues of $41.0 million during the quarter represented a decrease of 15% on a year-over-year basis. Data and AI segment revenues declined 21% during the quarter when compared to the first quarter of 2025, driven by cautious client spending and elongated decision-making cycles for new projects, as headwinds from macro-economic and geopolitical uncertainties have continued in the market. Positive new bookings momentum with TCV value of $7.0 million during the first quarter of 2026, as compared to $3.7 million during the first quarter of 2025. Talent segment revenues declined 11.8% when compared to the first quarter of 2025, driven by a 20.8% decrease in billable consultants as we continued to exit lower-margin and non-strategic positions. Strong average bill rate of $90.91, as compared to $87.82 during the first quarter of 2025 reflected a continued focus on revenue quality.
Management Commentary:
Nirav Patel, Mastech Digital's President and Chief Executive Officer, stated, "We continued to make progress during the first quarter against our transformation plan. A critical step in that journey was the realignment of our business into two new segments: Talent and Data & AI. As part of this effort, we have realigned certain clients more closely with our Data & AI business, a move we believe strengthens our integrated offerings and reinforces our position as a full-service provider. We believe this structure better reflects how we serve our clients and how we intend to create long-term value.
We believe geopolitical events and ongoing conflicts have created an environment of compounding uncertainty, and we are seeing enterprises respond with continued caution in their technology spending. While broad-based expansion in discretionary budgets has remained limited, organizations have continued to allocate toward strategic AI initiatives - a reflection that AI investment decisions, while deliberate, remain a priority. We plan to continue monitoring customer spending patterns as the environment evolves.
From the outset, we have been clear that savings had to come ahead of our investments. We are pleased that our transformation initiative, EDGE (Efficiencies Driving Growth and Expansion) announced in the third quarter of 2025, has continued to execute ahead of our expectations."
Re-Segmented Financial Reporting Overview:
Effective January 1, 2026, Mastech Digital realigned its former IT Staffing Services and Data and Analytics Services operating segments to reflect its AI-led operating strategy and resource allocation priorities. The new reportable segments are Talent and Data & AI. These changes did not impact our previously reported consolidated results.
The Data & AI segment consists solely of direct client engagements, including certain clients from the former IT Staffing Services division where we believe the Company has the potential to cross-sell services and increase market share. The offerings in this segment include data management and analytics, digital transformation consulting, AI and Industry Solutions, staffing to direct customers, data engineering and IT services, and managed services.
The Talent segment provides staffing solutions that enable clients to access skilled technology professionals across a broad range of digital and mainstream IT disciplines. These engagements include intermediated arrangements through managed service providers and systems integrators, as well as certain direct client relationships. We have structured this segment to allow clients to scale their technology teams efficiently while maintaining flexibility in response to changing business conditions.
Balance Sheet & Liquidity Update:
As of March 31, 2026, Mastech Digital had liquidity of $54.9 million, including cash and cash equivalents of $33.6 million and approximately $21.3 million of borrowing capacity available under its credit facility, with no bank debt.
Conference Call:
Mastech Digital will host a conference call to discuss the Company's first quarter 2026 financial results on May 15, 2026 at 9:00 a.m. Eastern Time. To join the call telephonically, please register at https://register-conf.media-server.com/register/BI12042dae45f94ede9096dd99c2bed8f6. Once registered, participants will receive the dial-in information and a unique PIN to access the call. The dial-in information and unique PIN will be sent to the email used to register for the call. The unique PIN is exclusive to the registrant and can only be used by one person at a time.
A live audio webcast of the conference call can be accessed through the Mastech Digital investor relations website at https://investors.mastechdigital.com, and a webcast replay will be accessible for a limited time following the scheduled call.
About Mastech Digital, Inc.:
Mastech Digital (NYSE American: MHH) is a leading provider of Digital Transformation IT Services. The Company offers Data Management, Analytics & AI Solutions, and IT Staffing Services with a digital-first approach. A minority-owned enterprise, Mastech Digital is headquartered in Pittsburgh, PA, with offices across the U.S., Canada, Europe, and India. Visit us at www.mastechdigital.com.
Use of Non-GAAP Measures:
This press release contains non-GAAP financial measures to supplement our financial results presented on a GAAP basis. The presentation of these financial measures is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. Investors are cautioned that there are material limitations associated with the use of non-GAAP financial measures as an analytical tool. Reconciliations of these non-GAAP measures to their comparable GAAP measures are included in the attached financial tables.
We believe that providing non-GAAP net income and non-GAAP diluted earnings per share offers investors useful supplemental information about the financial performance of our business, enables comparison of financial results between periods where certain items may vary independent of business performance, and allows for greater transparency with respect to key metrics used by management in operating our business. Additionally, management uses these non-GAAP financial measures in evaluating the Company's performance.
Specifically, the non-GAAP financial measures contained herein exclude the following expense items:
Amortization of acquired intangible assets: We amortize intangible assets acquired in connection with our June 2015 acquisition of Hudson IT, our July 2017 acquisition of the services division of InfoTrellis, Inc. and our October 2020 acquisition of AmberLeaf Partners. We exclude these amortization expenses in our non-GAAP financial measures because we believe it allows investors to make more meaningful comparisons between our operating results and those of other companies within our industry and facilitates a helpful comparison of our results with other periods.
Stock-based compensation expenses: We incur material recurring expenses related to non-cash, stock-based compensation. We exclude these expenses from our non-GAAP financial measures because we believe that it provides investors with meaningful supplemental information regarding operational performance. In particular, because of varying available valuation methodologies, subjective assumptions, and the variety of award types that companies can use under ASC 718, we believe that providing non-GAAP financial measures that exclude these expenses allows investors to make more meaningful comparisons between our operating results and those of other companies within our industry and facilitate comparisons of our results with other periods.
Forward-Looking Statements:
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