• Think of them as **ADP for your entire HR department**, handling everything from payroll to benefits and compliance for small businesses.
• They are like the **'Office 365 for HR,'** providing businesses a complete suite of HR, payroll, and benefits management.
• Imagine **Stripe, but for all your HR needs** – simplifying complex payroll, benefits, and compliance for businesses.

Insperity (NSP) primarily offers the following services:

• Professional Employer Organization (PEO) Services: Provides comprehensive HR outsourcing to small and medium-sized businesses, including payroll, employee benefits, HR compliance, workers' compensation, and HR administration.
• HR Solutions: Offers a range of standalone human resources services such as HR consulting, recruiting, performance management, and time and attendance solutions.

Company: Insperity (NSP)

Insperity (NSP) primarily sells its comprehensive human resources and business solutions to other companies. It operates as a professional employer organization (PEO), offering services such as HR administration, payroll processing, employee benefits, workers' compensation, and HR compliance to its clients.

Insperity's target market consists overwhelmingly of small and medium-sized businesses (SMBs) across a wide array of industries within the United States. Due to the highly diversified nature of its business model, Insperity serves tens of thousands of individual client companies. As a result, no single customer or small group of customers constitutes a "major customer" representing a material portion of Insperity's consolidated revenues.

Therefore, Insperity does not have publicly identified major customer companies in the traditional sense, as its revenue is spread across a large volume of SMB clients rather than concentrated with a few large enterprises.

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Paul J. Sarvadi, Chairman and Chief Executive Officer

Paul J. Sarvadi co-founded Insperity in 1986, helping to create the human resources (HR) outsourcing industry. Prior to Insperity, he started and operated several small companies. He has served as Chairman of the Board and CEO since 1989. Sarvadi is the author of "Take Care of Your People: The Enlightened CEO's Guide to Business Success" and was inducted into the Texas Business Hall of Fame in 2007. He attended Rice University and the University of Houston.

James D. Allison, Executive Vice President, Finance; Chief Financial Officer; Treasurer

Jim Allison was appointed Chief Financial Officer in November 2024, succeeding Douglas S. Sharp. He joined Insperity in 1997 and has held various roles of increasing responsibility in the finance department. Before his promotion to CFO, he served as Executive Vice President of Comprehensive Benefit Solutions and Chief Profitability Officer. Prior to joining Insperity, Allison worked in the audit practice of Ernst & Young LLP. He is a Certified Public Accountant and holds a bachelor's degree in business administration and a master's degree in professional accounting from the University of Texas.

A. Steve Arizpe, President and Chief Operating Officer

Steve Arizpe joined Insperity in 1989 as the Houston sales manager. He has served in a variety of leadership positions within the company, including regional sales manager, national sales manager, vice president of sales, and executive vice president of client services. In his current role, he is responsible for strategic leadership in sales, marketing, human resources, client services, traditional employment solutions, and information technology.

Kathy Johnson, Executive Vice President, Strategic Development

Kathy Johnson joined Insperity in 2002 and has held diverse leadership roles across operations, sales, and technology. Her previous position was senior vice president of middle market operations, where she oversaw both sales and operations for the company's largest customer segments. As Executive Vice President of Strategic Development, she focuses on the development and execution of the company's long-range strategies and growth initiatives, including data and analytics strategy, Enterprise Analytics, and Corporate Communications.

Christian P. Callens, Senior Vice President, Legal; General Counsel, Secretary

Christian P. Callens has served as Senior Vice President, Legal, General Counsel & Secretary since January 2024. He joined Insperity in January 2014 as Managing Counsel and Assistant Secretary, leading the Transactions and Corporate Law Practice Group. He was promoted to Deputy General Counsel, Managing Counsel & Assistant Secretary in October 2022. Before his tenure at Insperity, Callens was counsel in the corporate practice of Skadden, Arps, Slate, Meagher & Flom LLP and also held an executive position at a privately-held technology company.

Key Risks to Insperity (NSP)

1. High Benefits Cost Trend: The most urgent financial risk for Insperity is the escalating cost of employee benefits, particularly healthcare claims. This trend, including rising pharmacy expenses and an increase in significant insurance claims, is directly compressing the company's margins and impacting profitability. This issue has led to a reduction in the company's full-year 2025 guidance and a substantial drop in its stock price.
2. Client Attrition Due to Repricing: In response to the rising benefits costs, Insperity is implementing aggressive repricing strategies and making changes to its plan designs. While necessary to offset costs, these actions carry the operational risk of client attrition, despite the company's historically strong client retention rates.
3. Economic Uncertainty and Macroeconomic Slowdown: Insperity's business is highly sensitive to overall economic conditions. Adverse macroeconomic factors, such as a recession or a downturn in the market, could significantly impact its small and medium-sized enterprise (SME) client base. A weaker labor market, for instance, could lead to reduced hiring among clients and slower onboarding of new clients, thereby pressuring Insperity's revenue growth. The human resources industry is inherently cyclical, with demand tied directly to the health of the economy.

Insperity (NSP) primarily operates within the Professional Employer Organization (PEO) model, providing comprehensive human resources (HR) solutions to small and medium-sized businesses, predominantly in the United States. Their core offerings include payroll and employment administration, employee benefits, workers' compensation, government compliance, performance management, and training and development services.

Addressable Market Sizes:

• Professional Employer Organization (PEO) Industry (U.S.): The market size for the Professional Employer Organizations industry in the United States is projected to be $196.7 billion in 2025. Another source indicates the U.S. PEO Services Market was valued at $174.70 million in 2024 and is projected to reach $420.10 million by 2032. The PEO industry was also reported to generate $358 billion in revenue, growing quickly since 2012. In the U.S., PEOs serve over 200,000 businesses employing 4.5 million people.

• HR Outsourcing (HRO) Market (U.S. & Global): The global HR Outsourcing Market was valued at approximately $31.2 billion in 2024 and is projected to reach $56.4 billion by 2034, with a compound annual growth rate (CAGR) of 6.1%. North America held a dominant share of this market, capturing more than 37% and $11.54 billion in revenue in 2024. Another report states the global HRO market size was valued at $66.23 billion in 2024 and is projected to reach $170.8 billion by 2033. The U.S. HR outsourcing market alone generated $10.8 billion in 2024. Other sources estimate the global HR Outsourcing Market at $42.455.08 million in 2024, anticipated to reach $68,978.07 million by 2032. North America leads the HR outsourcing market, accounting for 42.6% of the global share in 2024. The market is also projected to grow from $19.97 billion in 2024 to $36.68 billion by 2032 globally.

• Human Resource Consulting Market (U.S. & Global): The global Human Resource Consulting Market size is estimated at $73.75 billion in 2024 and is expected to reach $104.02 billion by 2029. Another estimate places the global market at $79.03 billion in 2025, reaching $111.43 billion by 2030. North America held a significant share in the HR consulting market in 2023, and the United States has a robust industry. The U.S. human resource professional service market size was $1.71 billion in 2024 and is projected to be around $6.20 billion by 2034. The global human resource professional service market is valued at $7.40 billion in 2025 and is projected to reach $23.13 billion by 2034.

Insperity (NSP) is anticipated to drive future revenue growth over the next two to three years through several key initiatives and market dynamics:

1. Rollout and Adoption of HRScale: Insperity's strategic joint solution with Workday, branded as HRScale, is positioned as a significant catalyst for future growth. This offering specifically targets the underserved mid-market segment and is expected to drive large client sales and enhance client retention.
2. Strategic Pricing Increases: To counteract elevated healthcare costs and improve profitability, Insperity is implementing pricing increases for both new and renewing clients. These carefully calibrated adjustments are designed to maintain competitiveness while contributing to a significant profitability rebound in 2026.
3. Growth in Average Paid Worksite Employees (WSEEs): The company aims for continued expansion in its average number of paid worksite employees. This growth is expected to be fueled by new sales, strong client retention, and net hiring within existing client bases. Insperity reported a 1% year-over-year increase in WSEEs in Q3 2025.
4. Benefits from the New UnitedHealthcare Contract: The recently extended contract with UnitedHealthcare through 2028 is projected to yield substantial cost savings and foster strategic alignment. While directly impacting cost management, these savings can indirectly support revenue growth by enabling more flexible pricing strategies or allowing for increased investment in growth-oriented initiatives.

Share Repurchases

• Insperity repurchased 671,468 shares in 2022 and 424,509 shares in 2021.
• In the first half of 2025, $19 million was utilized for share repurchases, and an additional 45,000 shares were repurchased in Q3 2025.
• As of August 2023, the share repurchase authorization was increased by 2 million shares, representing approximately 5.25% of current shares outstanding. As of Q3 2025, 1,407,764 shares remained under authorization.

Share Issuance

• The number of outstanding shares was approximately 37,289,427 as of February 1, 2024, and 37,704,152 as of October 27, 2025.

Outbound Investments

• Insperity has a strategic partnership with Workday, Inc. to jointly develop, market, and sell a new full-service human resources solution for small and midsize businesses.
• The company invested approximately $57 million in the Workday strategic partnership in 2024.
• In Q2 2025, $14 million was invested in the Workday strategic partnership, followed by $11 million in Q3 2025.

Capital Expenditures

• Capital expenditures experienced significant increases, with capex per share reaching $2.55 in 2020.
• A primary focus of capital expenditures includes upgrading technology infrastructure to enhance service delivery and client experience.