Financial Analysis

12. Commitments and Contingencies We enter into fixed purchase and service obligations in the ordinary course of business. These arrangements primarily consist of advertising commitments and service contracts. At December 31, 2025, future purchase and service obligations greater than $100,000 and one year were as follows: (in millions) 2026 $ 58 2027 48 2028 33 2029 10 Total obligations $ 149 Litigation We are a defendant in various lawsuits and claims arising in the normal course of business. Management believes it has valid defenses in these cases and is defending them vigorously. While the results of litigation cannot be predicted with certainty, management believes the final outcome of such litigation will not have a material adverse effect on our financial position or results of operations.

CommitmentsAndContingenciesDisclosureTextBlock

6. Long-Term Debt We have a revolving credit facility (the Facility) with a revolving credit commitment of $750 million. The Facility may be further increased to $800 million based on the terms and subject to the conditions set forth in the agreement relating to the Facility (as amended, the Credit Agreement). The Facility is available for working capital and general corporate purposes, including acquisitions, stock repurchases and issuances of letters of credit. Our obligations under the Facility are secured by 100% of the stock of our captive insurance subsidiary and are guaranteed by all of our subsidiaries other than our captive insurance subsidiary and certain other excluded subsidiaries. At December 31, 2025, our outstanding balance on the Facility was $369 million, and we had an outstanding $1 million letter of credit issued under the Facility, resulting in unused commitment of $380 million. The Facility contains both affirmative and negative covenants that we believe are customary for arrangements of this nature. Covenants include, but are not limited to, limitations on our ability to incur additional indebtedness, sell material assets, retire, redeem or otherwise reacquire our capital stock, acquire the capital stock or assets of another business, make investments and pay dividends. In addition, the Credit Agreement requires us to comply with financial covenants limiting our total funded debt, minimum interest coverage ratio, and maximum leverage ratio. During 2025, …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

Our revenue for our PEO HR Solutions by geographic region and for our other products and services offerings are as follows: Year Ended December 31, (in millions) 2025 2024 2023 Northeast $ 1,873 $ 1,801 $ 1,757 Southeast 972 926 907 Central 1,230 1,195 1,170 Southwest 1,279 1,245 1,250 West 1,388 1,344 1,337 6,742 6,511 6,421 Other revenue 70 70 65 Total revenue $ 6,812 $ 6,581 $ 6,486

DisaggregationOfRevenueTableTextBlock

3. Fair Value Measurements We account for our financial assets in accordance with ASC 820, Fair Value Measurement . This standard defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. The fair value measurement disclosures are grouped into three levels based on valuation factors: Level 1 - quoted prices in active markets using identical assets Level 2 - significant other observable inputs, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other observable inputs Level 3 - significant unobservable inputs Fair Value of Instruments Measured and Recognized at Fair Value The following table summarizes the levels of fair value measurements of our financial assets: December 31, 2025 December 31, 2024 (in millions) Total Level 1 Total Level 1 Money market funds $ 660 $ 660 $ 1,048 $ 1,048 U.S. Treasury bills 18 18 16 16 678 678 1,064 1,064 Deposits - money market funds 230 230 241 241 Total $ 908 $ 908 $ 1,305 $ 1,305 Please read Note 2. Other Balance Sheet Information , for additional information. Our valuation techniques used to measure fair value for these securities during the period consisted primarily of third-party pricing services that utilized actual market data such as trades of comparable bond issues, broker/dealer quotations for the same or similar investments in active markets and other observable inputs. The following is a summary of our availabl …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

7. Income Taxes Deferred taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities used for financial reporting purposes and the amounts used for income tax purposes. Significant components of the net deferred tax assets as reflected on the Consolidated Balance Sheets are as follows: December 31, (in millions) 2025 2024 Deferred tax liabilities Prepaid assets $ (4) $ (4) Depreciation (3) (5) Software development costs (2) Tenant improvements (3) (3) Right-of-use leased assets (19) (19) Intangibles (3) (3) Total deferred tax liabilities (34) (34) Deferred tax assets Accrued incentive compensation 11 12 Workers compensation accruals 4 4 Accrued rent 3 2 Software development costs 13 Stock-based compensation 15 15 Operating lease liabilities 22 22 Other 2 1 Total deferred tax assets 57 69 Valuation allowance (1) (1) Total net deferred tax assets 56 68 Net deferred tax assets $ 22 $ 34 The components of income tax expense are as follows: Year Ended December 31, (in millions) 2025 2024 2023 Current income tax expense (benefit) Federal $ (7) $ 41 $ 49 State (2) 8 9 Total current income tax expense (benefit) (9) 49 58 Deferred income tax expense (benefit) Federal 10 (11) (3) State 2 (3) (1) Total deferred income tax expense (benefit) 12 (14) (4) Total income tax expense $ 3 $ 35 $ 54 The reconciliation of income tax expense computed at U.S. federal statutory tax rates to the reported income tax expense from continuing operation …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

11. Leases We have operating leases for office space, other operating facilities, vehicles and office equipment. Our fixed operating lease costs for 2025, 2024 and 2023 were $24 million, $20 million, and $19 million, respectively, and are included in general and administrative expenses on our Consolidated Statements of Operations. Lease costs for 2025 includes $3 million of accelerated lease costs related to the consolidation of sales offices during the year. During 2025, cash paid for amounts included in the measurement of operating lease liabilities was $24 million. The following table presents the lease balances within our Consolidated Balance Sheets, weighted average lease term and weighted average discount rates related to our operating leases: (dollars in millions) Classification in Consolidated Balance Sheets December 31, 2025 Lease liabilities: Current operating lease liabilities Other accrued liabilities $ 19 Long-term operating lease liabilities Operating lease liabilities, net of current 66 Total operating lease liabilities 85 Less: Landlord funded tenant improvements 10 Deferred rent 12 Operating lease ROU assets Right-of-use leased assets $ 63 Weighted average remaining lease term 5 years Weighted average discount rate 5 % The following presents the maturity of our operating lease liabilities as of December 31, 2025: (in millions) Operating Leases 2026 $ 23 2027 22 2028 18 2029 12 2030 9 Thereafter 13 Total remaining obligation 97 Less imputed interest 12 Present …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

Recent Accounting Pronouncements In December 2023, the FASB issued Accounting Standards Update (ASU) No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 expands the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. We adopted this standard for the year ended December 31, 2025, on a retrospective basis, and the impact of the adoption was not material to our Consolidated Financial Statements. Please read Note 7, Income T axes, for additional information. In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses. ASU 2024-03 requires public companies to disaggregate key expense categories such as employee compensation and depreciation in their financial statements. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. We are currently evaluating the guidance, but do not expect this ASU to materially impact our Consolidated Financial Statements. In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting For Internal-Use Software. ASU 2025-06 removes all references to software development stages and requi …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Segment Reporting ASC 280, Segment Reporting establishes standards for reporting information about operating segments on a basis consistent with our internal organizational structure as well as information about geographical areas and business segments. We use the management approach to determine reportable operating segments. The management approach considers the internal organization and reporting used by our chief operating decision maker (CODM) for making decisions, allocating resources and assessing performance. Our CODM has been identified as our chief executive officer, who reviews results when making decisions about allocating resources and assessing performance, in addition to considering our geographical footprint, which is based in the United States, and the management of our business activities, which is done on a consolidated basis. Based on managements assessment, we determined that we have only one operating segment and therefore one reportable segment, HR Solutions, as defined by ASC 280. The HR Solutions segment derives revenue from customers by providing various human resource services through professional service contracts. The accounting policies of the HR Solutions segment are the same as those described in the summary of significant accounting policies. The measure of segment assets is reported on our Consolidated Balance Sheets as total assets, and the CODM assesses performance and decides how to allocate resources based on net income as reported on our …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

1. Accounting Policies Description of Business Insperity, Inc. (Insperity or we, our, and us) provides an array of human resources (HR) and business solutions designed to help improve business performance. Since our formation in 1986, we have evolved from being solely a professional employer organization (PEO), an industry we pioneered, to our current position as a comprehensive business performance solutions provider. We were organized as a corporation in 1986 and have provided PEO services since inception. Our comprehensive HR services offerings are provided through our Insperity HR 360 solution (formerly Workforce Optimization ), our Insperity HR 360 Select Edition solution (formerly Workforce Synchronization TM ), and our Insperity HR Scale solution (together, our PEO HR Solutions) which encompass a broad range of HR functions as discussed in Item 1. Business Service Offerings PEO HR Solutions . HR 360. Insperitys HR 360 solution, our largest source of revenue, is offered to small and medium-sized businesses seeking a comprehensive people strategy. From payroll and employment administration, employee benefits, workers compensation, government compliance, performance management to training and development, our HR 360 solution offers a full range of services empowering clients to achieve a sophisticated HR function. HR 360 provides access to our web-based human capital management platform, Insperity Premier TM . HR 360 Select Edition. Insperitys HR 360 Select Edition soluti …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

8. Stockholders' Equity During 2025, we repurchased or withheld an aggregate of 231,668 shares of our common stock, as described below. Repurchase Program Our Board of Directors (the Board) has authorized a program to repurchase shares of our outstanding common stock (Repurchase Program). The purchases may be made from time to time in the open market or directly from stockholders at prevailing market prices based on market conditions and other factors. During 2025, 45,000 shares were repurchased under the Repurchase Program. As of December 31, 2025, we were authorized to repurchase an additional 1,407,764 shares under the Repurchase Program. Withheld Shares During 2025, we withheld 186,668 shares to satisfy tax withholding obligations for the vesting of long-term incentive and restricted stock unit awards. Dividends The Board declared and paid quarterly dividends as follows: (amounts per share) 2025 2024 First quarter $ 0.60 $ 0.57 Second quarter 0.60 0.60 Third quarter 0.60 0.60 Fourth quarter 0.60 0.60 During 2025 and 2024, we declared and paid dividends totaling $90 million and $89 million, respectively. Preferred Stock At December 31, 2025, 20 million shares of preferred stock were authorized. …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing

8. Commitments and Contingencies Litigation We are a defendant in various lawsuits and claims arising in the normal course of business. Management believes it has valid defenses in these cases and is defending them vigorously. While the results of litigation cannot be predicted with certainty, management believes the final outcome of such litigation will not have a material adverse effect on our financial position or results of operations.

CommitmentsAndContingenciesDisclosureTextBlock

5. Long-Term Debt We have a revolving credit facility (the Facility) with a revolving credit commitment of $750 million. The Facility may be further increased to $800 million based on the terms and subject to the conditions set forth in the agreement relating to the Facility (as amended, the Credit Agreement). The Facility is available for working capital and general corporate purposes, including acquisitions, stock repurchases and issuances of letters of credit. Our obligations under the Facility are secured by 100% of the stock of our captive insurance subsidiary and are guaranteed by all of our subsidiaries other than our captive insurance subsidiary and certain other excluded subsidiaries. At June 30, 2026, our outstanding balance on the Facility was $419 million, and we had an outstanding $1 million letter of credit issued under the Facility, resulting in unused commitment of $330 million. The Facility contains both affirmative and negative covenants that we believe are customary for arrangements of this nature. Covenants include, but are not limited to, limitations on our ability to incur additional indebtedness, sell material assets, retire, redeem or otherwise reacquire our capital stock, acquire the capital stock or assets of another business, make investments and pay dividends. In addition, the Credit Agreement requires us to comply with financial covenants limiting our total funded debt, minimum interest coverage ratio, and maximum leverage ratio. During 2025, we a …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

Our revenue for our PEO HR Solutions by geographic region and for our other products and services offerings are as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions) 2026 2025 % Change 2026 2025 % Change Northeast $ 446 $ 452 (1) % $ 973 $ 978 (1) % Southeast 250 238 5 % 521 495 5 % Central 308 301 2 % 650 636 2 % Southwest 314 311 1 % 664 658 1 % West 353 339 4 % 739 716 3 % 1,671 1,641 2 % 3,547 3,483 2 % Other revenue 15 17 (12) % 34 38 (11) % Total revenue $ 1,686 $ 1,658 2 % $ 3,581 $ 3,521 2 %

DisaggregationOfRevenueTableTextBlock

4. Fair Value Measurements We account for our financial assets in accordance with ASC 820, Fair Value Measurement . This standard defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. The fair value measurement disclosures are grouped into three levels based on valuation factors: Level 1 - quoted prices in active markets using identical assets Level 2 - significant other observable inputs, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other observable inputs Level 3 - significant unobservable inputs Fair Value of Instruments Measured and Recognized at Fair Value The following table summarizes the levels of fair value measurements of our financial assets: June 30, 2026 December 31, 2025 (in millions) Total Level 1 Total Level 1 Money market funds $ 627 $ 627 $ 660 $ 660 U.S. Treasury bills 18 18 627 627 678 678 Deposits - money market funds 236 236 230 230 Total $ 863 $ 863 $ 908 $ 908 Please read Note 3. Other Balance Sheet Information , for additional information. Our valuation techniques used to measure fair value for these securities during the period consisted primarily of third-party pricing services that utilized actual market data such as trades of comparable bond issues, broker/dealer quotations for the same or similar investments in active markets and other observable inputs. The following is a summary of our available-for-sale marketable …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Recently Adopted Accounting Pronouncements In September 2025, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. ASU 2025-06 removes all references to software development stages and requires capitalization of software costs when management has committed to the software project and it is probable the software will be completed and perform its intended use. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027, and for interim periods within those annual periods, with early adoption permitted. We early adopted ASU 2025-06 effective January 1, 2026 on a prospective basis and the impact of the adoption was not material to our Consolidated Financial Statements. …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Segment Reporting ASC 280, Segment Reporting establishes standards for reporting information about operating segments on a basis consistent with our internal organizational structure as well as information about geographical areas and business segments. Based on managements assessment, we determined that we have only one operating segment and therefore one reportable segment, HR Solutions, as defined by ASC 280. The accounting policies of the HR Solutions segment are the same as those described in the summary of significant accounting policies. The measure of segment assets is reported on our Consolidated Balance Sheets as total assets, and the chief operating decision maker (CODM) assesses performance and decides how to allocate resources based on net income as reported in our Consolidated Statements of Operations. The CODM reviews revenues and expenses at the consolidated level as disclosed in our Consolidated Statements of Operations and uses net income to evaluate income generated from segment assets (return on assets) in deciding whether to reinvest profits into our HR Solutions segment or into other areas of the entity, such as for acquisitions or to pay dividends. Net income is also used to monitor budget versus actual results and in competitive analysis by benchmarking to our competitors. The competitive analysis and the monitoring of budgeted versus actual results are used in assessing the segments performance and in establishing managements compensation. …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

2. Accounting Policies Health Insurance Costs We provide group health insurance coverage under a single-employer plan that covers both our WSEEs in our PEO HR Solutions and our corporate employees and utilizes a national network of carriers, including UnitedHealthcare (United), UnitedHealthcare of California, Kaiser Permanente, Blue Shield of California, HMSA BlueCross BlueShield of Hawaii, and Harvard Pilgrim Health Care, all of which provide fully insured policies or service contracts. Approximately 85% of our costs related to health insurance coverage are incurred under our policy with United. While the policy with United is a fully insured plan, as a result of certain contractual terms, we have accounted for this plan since its inception using a partially self-funded insurance accounting model. Effective January 1, 2020 through December 31, 2025, our financial responsibility for a participants annual claim costs was limited to $1 million (Individual Claims Limit). Beginning January 1, 2026, we have the option to annually elect to limit our responsibility for each participants claim costs to $500,000, $750,000, or $1,000,000 per year, which we elect based on the cost of the limit (Selected Claims Limit) and our estimate of the benefit to us at that level of limit. The cost of the Selected Claims Limit is recognized evenly over the year, whereas, the claims recovery benefit on the Selected Claims Limit is expected to increase throughout the year, with the expected increase …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

6. Stockholders' Equity During the six months ended June 30, 2026, we repurchased or withheld an aggregate of 171,548 shares of our common stock, as described below. Repurchase Program Our Board of Directors (the Board) has authorized a program to repurchase shares of our outstanding common stock (Repurchase Program). The purchases may be made from time to time in the open market or directly from stockholders at prevailing market prices based on market conditions and other factors. During the six months ended June 30, 2026, no shares were repurchased under the Repurchase Program. As of June 30, 2026, we were authorized to repurchase an additional 1,407,764 shares under the Repurchase Program. Withheld Shares During the six months ended June 30, 2026, we withheld 171,548 shares to satisfy tax withholding obligations for the vesting of long-term incentive and restricted stock unit awards. Dividends The Board declared and paid quarterly dividends as follows: (amounts per share) 2026 2025 First quarter $ 0.60 $ 0.60 Second quarter 0.60 0.60 During the six months ended June 30, 2026 and 2025, we declared and paid dividends totaling $46 million and $45 million, respectively. …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing