SThree PLC (LSE:STEM) shares tumbled 24% after the recruiter issued an unscheduled update where it gave assurance on this year's outlook but issued an early profit warning for 2025.
To try and sweeten the pill a little, a share buyback programme of up to £20 million was announced.
The science, technology and engineering staffing group said new business activity has been weak throughout the year, with recent political and macroeconomic uncertainty delaying client decision making.
"The board is now making the prudent assumption that these challenges will persist throughout FY25, impacting net fees," said SThree.
Profit before tax for 2025 is now expected to be around £25 million, compared to the roughly £66 million that analysts currently expected.
This includes up to £7 million of one-off costs to deliver operational efficiencies which are expected to deliver circa £6 million of savings.
The board expressed confidence that the group's strategic focus and new a cost savings programme "will position the group for sustained profitable growth when markets recover".
Broker Panmure Liberum said: "We were expecting some pressure on forecasts, given no signs of green shoots in the macro yet, but the level outlined by management is significantly worse than we had feared."
Analysts added that the share buyback "will offer little consolation today".