Company Overview - Korn Ferry operates in 111 offices across 53 countries, with 8,198 full-time employees, including 2,979 consultants[12]. - The organization operates through four global segments: Consulting, Digital, Executive Search, and RPO & Professional Search, ensuring a diversified service offering[52]. - The company had a total of 8,198 full-time employees as of April 30, 2020, with 1,686 in Executive Search and 2,891 in RPO & Professional Search[88]. Client Engagement and Revenue - In fiscal 2020, Korn Ferry partnered with 13,724 client organizations, achieving a client loyalty rate of 90% for engagements completed for repeat clients[13]. - Approximately 71% of Korn Ferry's revenue comes from clients utilizing multiple lines of business, indicating strong cross-segment integration[16]. - Consulting fee revenue was $543.1 million in fiscal 2020, representing 28% of the Company's total fee revenue[61]. - Digital fee revenue increased to $292.4 million in fiscal 2020, up from $252.7 million in fiscal 2019, marking a growth of approximately 15%[67]. - During fiscal 2020, the Consulting segment partnered with approximately 4,800 clients globally, with 22% of fee revenue referred from other segments[62]. - Korn Ferry's RPO & Professional Search segment partnered with 2,202 clients globally, with 43% of its fiscal 2020 fee revenue referred from the Executive Search Consulting and Digital segments[85]. Strategic Initiatives - The company has evolved into a multi-faceted consultancy, expanding into larger addressable markets for higher growth potential and more durable revenue streams[25]. - Korn Ferry's go-to-market strategy aims to integrate core solutions, with 71% of revenues derived from clients using multiple services[40]. - The Korn Ferry Institute focuses on crisis management and organizational transformation, driving business and societal impact through research and analytics[35]. - Korn Ferry's digital transformation services help clients implement agile operating models and attract digital talent through proprietary data insights[30]. - Korn Ferry's talent strategy emphasizes the importance of upskilling and developing existing workforces to address the anticipated global talent shortage[1]. Financial Performance and Challenges - The company reported a restructuring charge of $40.5 million in fiscal 2020 due to a reduction in workforce as part of its cost-saving measures[95]. - The company's profitability is significantly affected by the utilization and billing rates of its consultants, which are influenced by various market factors[120]. - The company may experience difficulties in aligning its cost structure with revenue levels, impacting financial results if utilization and billing rates are not maintained[97]. - The company faces significant competition in the human resource consulting market, with large firms like Ernst & Young and McKinsey posing challenges to market share and pricing[99]. - The company is subject to potential legal liabilities from various stakeholders, including clients and candidates, which may not be fully covered by insurance[114]. Debt and Financial Obligations - The company had approximately $400.0 million in total indebtedness outstanding as of April 30, 2020[129]. - The company's ability to service its indebtedness depends on its financial and operating performance, which is influenced by external economic factors[135]. - The company may need to restructure or refinance its debt if it is unable to meet its debt service obligations, which could impair its liquidity[136]. - The company is subject to financial covenants in its Credit Agreement, which may limit its ability to raise additional debt or equity financing[141]. Acquisitions and Growth Strategy - The company has made strategic acquisitions, including the acquisition of Hay Group in fiscal 2016, as part of its growth strategy[160]. - Future acquisitions may be conditioned on maintaining pro forma compliance with financial covenants and having domestic liquidity of at least $50 million[161]. - The company faces risks related to the integration of acquired businesses, which could adversely affect its financial condition and reputation[163]. Market and Regulatory Risks - The company faces risks associated with social and political instability in international operations, which could affect overall performance[97]. - Changes in foreign currency exchange rates could adversely affect the company's financial results, as a material portion of revenue and expenses are generated internationally[124]. - Compliance with data protection laws like GDPR may increase operational costs and limit service offerings, with potential fines up to 4% of annual worldwide revenue for non-compliance[156]. - The evolving regulatory landscape regarding data security may impose additional burdens and increase potential exposure to penalties for non-compliance[159]. Stockholder and Capital Management - The company has a stock repurchase program with an aggregate capacity of $250 million, allowing for repurchases in open market transactions or privately negotiated transactions[208]. - The Board of Directors adopted a quarterly cash dividend policy of $0.10 per share on December 8, 2014[204]. - The cumulative total stockholder return for the company is measured against the S&P 500 Index and a peer group, assuming an initial investment of $100 on April 30, 2015[198].

Financial Data and Key Metrics Changes - For the full year of fiscal '20, the company's fee revenue was $1.93 billion, essentially flat year-over-year [29] - Adjusted EBITDA for the full year was $301 million, with an adjusted EBITDA margin of 15.6% [29] - In Q4, fee revenue was $440.5 million, down 7.9% year-over-year at constant currency [30] - Adjusted EBITDA in Q4 was approximately $70 million, with a 15.8% adjusted EBITDA margin [30] - Adjusted fully diluted earnings per share in Q4 were $0.60 [30] Business Line Data and Key Metrics Changes - Executive Search fee revenue in Q4 was down 10% globally [30] - RPO and Professional Search fee revenue was down 9% year-over-year [30] - Consulting fee revenue decreased by 14% year-over-year [30] - Digital segment grew by 14% year-over-year, with Q4 fee revenue of $69 million [36] Market Data and Key Metrics Changes - In Q4, North America and EMEA Executive Search revenues were each down 10% year-over-year, while APAC was down 16% [40] - New business trends showed a decline of approximately 30% year-over-year in April, stabilizing to a 26% decline in June [22][43] Company Strategy and Development Direction - The company is focusing on reimagining its business model, moving from analog to digital delivery in its assessment and learning business [18] - Korn Ferry aims to maintain operational flexibility and has set a goal of at least neutral EBITDA during the COVID-19 crisis [23][34] - The company is committed to investing in recovery and has a strong balance sheet with $863 million in cash and marketable securities [31] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the unprecedented impact of the pandemic on business operations and expressed optimism about future opportunities for growth [14][20] - The company is seeing signs of stabilization in new business, with June showing an 18% increase over May [22] - Management refrained from providing specific revenue and earnings guidance for Q1 FY '21 due to ongoing uncertainties [25] Other Important Information - The company has taken swift actions to reduce its cost base by approximately $300 million on a run rate basis [33] - Korn Ferry has seen an uptick in its diversity and inclusion consulting business amid the pandemic [51] Q&A Session Summary Question: Recent trends in the Consulting business - Management noted an uptick in diversity and inclusion services and indicated that June new business in Consulting was down about 29% [51][52] Question: Performance of recent acquisitions - Management stated that the integration of recent acquisitions has been successful, contributing positively to the business [62] Question: Breakdown of new business trends by geography and service line - Management provided insights that RPO new business was up 72% over the last four months, while Professional Search was down 36% [67] Question: Maintaining EBITDA neutrality - Management clarified that the goal is to maintain a minimum of EBITDA breakeven, with the timeline dependent on the resolution of the humanitarian crisis [81][86] Question: Impact of working from home on Consulting business - Management indicated that the shift to virtual delivery has significantly impacted the learning and development segments, which were previously reliant on in-person interactions [102][106]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended January 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to ___________ Commission File Number 001-14505 KORN FERRY (Exact Name of Registrant as Specified in its Charter) Delaware 95-2623879 (State or Other Jurisdi ...

Part I. Financial Information [Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents the unaudited consolidated financial statements for the three and six months ended October 31, 2019 and 2018, notably impacted by the new ASC 842 lease accounting standard [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) As of October 31, 2019, total assets increased to **$2.49 billion** from **$2.33 billion** due to **$214.4 million** in operating lease right-of-use assets, while cash and cash equivalents decreased from **$626.4 million** to **$464.4 million** Consolidated Balance Sheet Highlights (in thousands) | Account | October 31, 2019 | April 30, 2019 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $464,423 | $626,360 | | Total current assets | $1,049,498 | $1,136,810 | | Operating lease right-of-use assets, net | $214,421 | $— | | Goodwill | $578,307 | $578,298 | | **Total assets** | **$2,486,281** | **$2,334,852** | | **Liabilities & Equity** | | | | Total current liabilities | $450,465 | $550,958 | | Operating lease liability, non-current | $200,266 | $— | | Long-term debt | $273,310 | $222,878 | | **Total liabilities** | **$1,227,790** | **$1,091,465** | | **Total stockholders' equity** | **$1,258,491** | **$1,243,387** | - The company adopted a new lease accounting standard (ASC 842) in fiscal 2020, resulting in the recognition of operating lease right-of-use assets of **$214.4 million** and corresponding lease liabilities (current and non-current) of **$248.8 million** as of October 31, 2019[7](index=7&type=chunk)[52](index=52&type=chunk)[53](index=53&type=chunk) [Consolidated Statements of Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income) For the three months ended October 31, 2019, fee revenue slightly decreased to **$492.4 million**, operating income declined to **$61.9 million**, and net income attributable to Korn Ferry was **$42.8 million** or **$0.77** per diluted share Consolidated Income Statement Summary (in thousands, except per share data) | Metric | Q2 FY2020 (3 mo ended Oct 31, '19) | Q2 FY2019 (3 mo ended Oct 31, '18) | YTD FY2020 (6 mo ended Oct 31, '19) | YTD FY2019 (6 mo ended Oct 31, '18) | | :--- | :--- | :--- | :--- | :--- | | Fee Revenue | $492,389 | $495,205 | $976,938 | $960,773 | | Total Revenue | $504,177 | $506,793 | $1,000,375 | $985,155 | | Operating Income | $61,869 | $70,987 | $122,203 | $15,868 | | Net Income Attributable to Korn Ferry | $42,804 | $46,034 | $85,755 | $7,423 | | Diluted EPS | $0.77 | $0.81 | $1.54 | $0.13 | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended October 31, 2019, net cash used in operating activities significantly increased to **$104.1 million**, while net cash used in investing activities decreased to **$22.8 million**, and financing activities increased to **$31.4 million** Cash Flow Summary (in thousands) | Activity | Six Months Ended Oct 31, 2019 | Six Months Ended Oct 31, 2018 | | :--- | :--- | :--- | | Net cash used in operating activities | $(104,098) | $(32,189) | | Net cash used in investing activities | $(22,817) | $(53,416) | | Net cash used in financing activities | $(31,421) | $(27,440) | | **Net decrease in cash and cash equivalents** | **$(161,937)** | **$(133,169)** | [Notes to Consolidated Unaudited Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Unaudited%20Financial%20Statements) The notes detail accounting policies, segment performance, financial instruments, and key disclosures, including business segments and a subsequent restructuring plan - The company operates through three global segments: Korn Ferry Advisory, Executive Search, and Korn Ferry RPO & Professional Search[18](index=18&type=chunk) - In the prior year (six months ended Oct 31, 2018), the company recorded a non-cash intangible asset write-off of **$106.6 million** related to the discontinuation of sub-brands like Hay Group and Lominger as part of its rebranding to a single master brand[44](index=44&type=chunk) Fee Revenue by Industry (Six Months Ended Oct 31) | Industry | 2019 Fee Revenue (in thousands) | % of Total | 2018 Fee Revenue (in thousands) | % of Total | | :--- | :--- | :--- | :--- | :--- | | Industrial | $278,917 | 28.5% | $279,699 | 29.1% | | Financial Services | $172,333 | 17.6% | $174,405 | 18.2% | | Life Sciences/Healthcare | $170,921 | 17.5% | $162,771 | 16.9% | | Consumer Goods | $147,060 | 15.1% | $150,662 | 15.7% | | Technology | $139,450 | 14.3% | $122,967 | 12.8% | - Subsequent to the quarter end, on November 1, 2019, the company adopted a restructuring plan related to recent acquisitions, with estimated costs of **$20.0 million to $26.0 million** for severance and office consolidation[114](index=114&type=chunk)[116](index=116&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 FY2020 performance, highlighting a **1%** fee revenue decrease to **$492.4 million** due to currency headwinds, alongside segment performance, liquidity, and capital allocation [Results of Operations](index=30&type=section&id=Results%20of%20Operations) For Q2 FY2020, fee revenue decreased **1%** year-over-year to **$492.4 million**, with Advisory and Executive Search declining, while RPO & Professional Search grew **18%**, leading to a **13%** decrease in operating income to **$61.9 million** Q2 FY2020 vs Q2 FY2019 Fee Revenue by Segment (in millions) | Segment | Q2 FY2020 | Q2 FY2019 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Advisory | $209.8 | $217.1 | $(7.3) | -3% | | Executive Search | $187.9 | $197.6 | $(9.7) | -5% | | RPO & Professional Search | $94.8 | $80.5 | $14.3 | +18% | | **Total Fee Revenue** | **$492.4** | **$495.2** | **$(2.8)** | **-1%** | Q2 FY2020 vs Q2 FY2019 Operating Income & Margin by Segment (in millions) | Segment | Q2 FY2020 Op. Income | Q2 FY2020 Margin | Q2 FY2019 Op. Income | Q2 FY2019 Margin | | :--- | :--- | :--- | :--- | :--- | | Advisory | $28.4 | 13.5% | $29.4 | 13.6% | | Executive Search | $41.2 | 21.9% | $51.5 | 26.0% | | RPO & Professional Search | $15.1 | 15.9% | $12.5 | 15.6% | | **Total Operating Income** | **$61.9** | **12.6%** | **$71.0** | **14.3%** | - For the six months ended October 31, 2018, the company took a one-time, non-cash write-off of tradenames of **$106.6 million**, which significantly impacted prior-year operating income, particularly in the Advisory segment[121](index=121&type=chunk)[184](index=184&type=chunk)[185](index=185&type=chunk) [Liquidity and Capital Resources](index=40&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a balanced capital allocation strategy focused on growth, dividends, and opportunistic share repurchases, with **$609.0 million** in cash and marketable securities and **$369.9 million** available under its revolving credit facility - Capital allocation priorities are: 1) investing in growth initiatives (hiring, IP development, M&A), 2) returning capital to shareholders via a regular quarterly dividend, and 3) opportunistic share repurchases[205](index=205&type=chunk) Liquidity Position as of October 31, 2019 | Item | Amount (in millions) | | :--- | :--- | | Cash and cash equivalents | $464.4 | | Marketable securities | $144.6 | | **Total Cash & Marketable Securities** | **$609.0** | | Revolver Availability | $369.9 | - The company repurchased approximately **$61.9 million** of its stock in the six months ended October 31, 2019. As of October 31, 2019, **$188.8 million** remained available under the share repurchase program[208](index=208&type=chunk)[239](index=239&type=chunk) - On October 29, 2019, the company drew down an additional **$50.0 million** on its revolver to help finance recently completed acquisitions[108](index=108&type=chunk)[206](index=206&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to market risks from foreign currency fluctuations and interest rate changes, which are mitigated through forward contracts and an interest rate swap agreement - A hypothetical **10% adverse change** in the value of key foreign currencies could result in a foreign exchange loss of **$10.9 million**. The company uses foreign currency forward contracts to offset these risks[230](index=230&type=chunk) - The company has **$276.9 million** outstanding under its variable-rate Revolver. A **100-basis point increase** in LIBOR would have increased interest expense by approximately **$1.2 million** for the six months ended October 31, 2019. This risk is partially mitigated by an interest rate swap with a notional amount of **$99.7 million**[231](index=231&type=chunk)[232](index=232&type=chunk) [Controls and Procedures](index=43&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of October 31, 2019, with no material changes in internal control over financial reporting - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[234](index=234&type=chunk) Part II. Other Information [Legal Proceedings](index=44&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently engaged in any legal proceedings expected to have a material adverse effect on its financial condition or results of operations - As of the report date, the company is not engaged in any legal proceedings expected to have a material adverse effect on its business, financial condition, or operations[237](index=237&type=chunk) [Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred in the risk factors previously disclosed in the company's Annual Report on Form 10-K for the fiscal year ended April 30, 2019 - No material changes have occurred in the risk factors described in the company's Annual Report on Form 10-K for the year ended April 30, 2019[238](index=238&type=chunk) [Issuer Purchases of Equity Securities](index=44&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities,%20Use%20of%20Proceeds%20and%20Issuer%20Purchases%20of%20Equity%20Securities) This section details the company's common stock repurchases during the quarter ended October 31, 2019, totaling **1,309,092 shares** for approximately **$49.2 million** under its publicly announced program Issuer Purchases of Equity Securities (Quarter Ended Oct 31, 2019) | Period | Total Shares Purchased | Average Price Paid Per Share | Shares Purchased as Part of Program | Approx. Dollar Value Remaining in Program | | :--- | :--- | :--- | :--- | :--- | | Aug 2019 | 598,592 | $38.06 | 598,592 | $215.2 million | | Sep 2019 | 369,096 | $38.13 | 367,500 | $201.2 million | | Oct 2019 | 344,986 | $36.15 | 343,000 | $188.8 million | | **Total** | **1,312,674** | **$37.58** | **1,309,092** | **N/A** | [Exhibits](index=45&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL data files

[Part I. Financial Information](index=3&type=section&id=Part%20I.%20Financial%20Information) [Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents Korn Ferry's unaudited consolidated financial statements, highlighting a turnaround from a prior-year net loss to net income and modest revenue growth [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Korn Ferry's total assets increased to **$2.41 billion** due to new operating lease right-of-use assets, while cash and cash equivalents significantly decreased Consolidated Balance Sheet Highlights (in thousands) | Account | July 31, 2019 (unaudited) | April 30, 2019 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $424,637 | $626,360 | | Total current assets | $975,123 | $1,136,810 | | Operating lease right-of-use assets, net | $219,412 | $— | | Goodwill | $578,567 | $578,298 | | **Total assets** | **$2,406,558** | **$2,334,852** | | **Liabilities & Equity** | | | | Total current liabilities | $411,653 | $550,958 | | Operating lease liability, non-current | $207,603 | $— | | Long-term debt | $223,094 | $222,878 | | **Total liabilities** | **$1,142,164** | **$1,091,465** | | **Total stockholders' equity** | **$1,264,394** | **$1,243,387** | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) Total revenue increased 4% to **$496.2 million**, with operating income swinging to **$60.3 million** from a prior-year loss, primarily due to the absence of a tradename write-off Consolidated Statements of Operations (in thousands, except per share data) | Metric | Three Months Ended July 31, 2019 | Three Months Ended July 31, 2018 | | :--- | :--- | :--- | | Fee revenue | $484,549 | $465,568 | | Total revenue | $496,198 | $478,362 | | Operating income (loss) | $60,334 | $(55,119) | | Net income (loss) attributable to Korn Ferry | $42,951 | $(38,611) | | Diluted earnings (loss) per share | $0.76 | $(0.70) | | Cash dividends declared per share | $0.10 | $0.10 | - The significant swing from a net loss to net income year-over-year was primarily caused by a one-time, non-cash tradename write-off of **$106.6 million** in the quarter ended July 31, 2018, which was recorded in general and administrative expenses[46](index=46&type=chunk)[120](index=120&type=chunk) [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash used by operating activities increased to **$161.9 million**, primarily due to working capital changes and bonus payments, leading to a **$201.7 million** decrease in cash and cash equivalents Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Three Months Ended July 31, 2019 | Three Months Ended July 31, 2018 | | :--- | :--- | :--- | | Net cash used by operating activities | $(161,919) | $(117,492) | | Net cash used in investing activities | $(9,209) | $(6,632) | | Net cash used in financing activities | $(24,927) | $(20,587) | | **Net decrease in cash and cash equivalents** | **$(201,723)** | **$(155,119)** | | **Cash and cash equivalents at end of period** | **$424,637** | **$365,729** | [Notes to Consolidated Unaudited Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Unaudited%20Financial%20Statements) These notes detail accounting policies, the impact of ASC 842 on the balance sheet, segment operations, fee revenue disaggregation by industry, debt structure, and dividend declarations - The company operates through three global segments: Advisory, Executive Search, and RPO & Professional Search[20](index=20&type=chunk)[105](index=105&type=chunk) - Effective May 1, 2019, the company adopted the new lease accounting standard (ASC 842), resulting in the recognition of **$236.1 million** in Right-of-Use (ROU) assets and a corresponding liability of **$272.3 million**[54](index=54&type=chunk)[55](index=55&type=chunk) Fee Revenue by Industry (Three Months Ended July 31, 2019) | Industry | Dollars (in thousands) | % of Total | | :--- | :--- | :--- | | Industrial | $139,907 | 28.9% | | Financial Services | $86,876 | 17.9% | | Life Sciences/Healthcare | $82,114 | 16.9% | | Consumer Goods | $71,833 | 14.8% | | Technology | $69,095 | 14.3% | | Education/Non-Profit | $30,761 | 6.4% | | **Total Fee Revenue** | **$484,549** | **100.0%** | - On September 4, 2019, the Board of Directors declared a quarterly cash dividend of **$0.10 per share**[115](index=115&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=25&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 FY2020 financial results, highlighting 4% fee revenue growth, increased Adjusted EBITDA, the impact of a prior-year tradename write-off, and the company's liquidity and capital allocation strategy Q1 FY2020 Financial Highlights vs. Q1 FY2019 | Metric | Q1 FY2020 (ended Jul 31, 2019) | Q1 FY2019 (ended Jul 31, 2018) | Change | | :--- | :--- | :--- | :--- | | Fee Revenue | $484.5M | $465.6M | +4% | | Operating Income (Loss) | $60.3M | $(55.1)M | +$115.4M | | Net Income (Loss) Attributable to Korn Ferry | $43.0M | $(38.6)M | +$81.6M | | Adjusted EBITDA | $74.9M | $70.8M | +$4.1M | - The RPO & Professional Search segment was the primary driver of growth, with fee revenue increasing by **$18.5 million**, or **24%**, year-over-year[138](index=138&type=chunk) - The significant improvement in operating and net income is primarily due to a one-time, non-cash write-off of tradenames of **$106.6 million** in the prior-year quarter related to the 'One Korn Ferry' rebranding plan[120](index=120&type=chunk)[145](index=145&type=chunk)[153](index=153&type=chunk) [Results of Operations](index=28&type=section&id=Results%20of%20Operations) Fee revenue grew 4% to **$484.5 million**, driven by **24%** growth in RPO & Professional Search, while operating income swung to **$60.3 million** due to the absence of a prior-year tradename write-off Fee Revenue by Segment (in thousands) | Segment | Q1 FY2020 | Q1 FY2019 | % Change | | :--- | :--- | :--- | :--- | | Advisory | $195,526 | $195,375 | 0.1% | | Executive Search | $193,199 | $192,924 | 0.1% | | RPO & Professional Search | $95,824 | $77,269 | 24.0% | | **Total Fee Revenue** | **$484,549** | **$465,568** | **4.1%** | Adjusted EBITDA by Segment (in thousands) | Segment | Q1 FY2020 | Q1 FY2019 | % Change | | :--- | :--- | :--- | :--- | | Advisory | $34,570 | $34,504 | 0.2% | | Executive Search | $48,891 | $46,757 | 4.6% | | RPO & Professional Search | $16,107 | $12,511 | 28.7% | | Corporate | $(24,631) | $(22,978) | (7.2%) | | **Total Adjusted EBITDA** | **$74,937** | **$70,794** | **5.8%** | [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity position with **$567.3 million** in cash and equivalents, a **$650 million** credit facility, and continues its capital allocation strategy through share repurchases and dividends - Cash, cash equivalents, and marketable securities stood at **$567.3 million** as of July 31, 2019[173](index=173&type=chunk) - The company has a **$650 million** revolving credit facility, with **$226.9 million** outstanding and **$419.9 million** available as of July 31, 2019[168](index=168&type=chunk)[184](index=184&type=chunk) - During the quarter, the company repurchased **$12.7 million** of its common stock, leaving **$238.0 million** remaining under its share repurchase program[170](index=170&type=chunk) - The Board of Directors maintains a quarterly cash dividend policy of **$0.10 per share**[169](index=169&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from foreign currency fluctuations and interest rate changes, mitigated by foreign currency forward contracts and an interest rate swap on its variable-rate debt - The company's primary market risks are foreign currency exchange fluctuations and interest rate changes[189](index=189&type=chunk) - To mitigate interest rate risk on its variable-rate debt, the company uses an interest rate swap with a notional amount of **$103.1 million**, maturing June 15, 2021, which locks the interest rate at **1.919%** plus a credit spread[194](index=194&type=chunk) - The company utilizes foreign currency forward contracts to offset risks from intercompany balances and other foreign currency exposures, but these are not designated as hedging instruments[192](index=192&type=chunk) [Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) The CEO and CFO concluded that disclosure controls and procedures were effective, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of July 31, 2019[196](index=196&type=chunk) - No material changes were identified in the company's internal control over financial reporting during the quarter[196](index=196&type=chunk) [Part II. Other Information](index=38&type=section&id=Part%20II.%20Other%20Information) [Legal Proceedings](index=38&type=section&id=Item%201.%20Legal%20Proceedings) The company is not engaged in any legal proceedings expected to have a material adverse effect on its business or financial condition - The company is not engaged in any legal proceedings that are expected to have a material adverse effect on its business or financial condition[199](index=199&type=chunk) [Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred to the risk factors previously disclosed in the company's Annual Report on Form 10-K - No material changes to the risk factors described in the Form 10-K for the year ended April 30, 2019 have occurred[200](index=200&type=chunk) [Issuer Purchases of Equity Securities](index=38&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%20and%20Issuer%20Purchases%20of%20Equity%20Securities) During the quarter, the company repurchased **545,754** shares for approximately **$12.7 million**, with **$238.0 million** remaining under the share repurchase program Issuer Purchases of Equity Securities (Quarter Ended July 31, 2019) | Period | Total Shares Purchased | Average Price Paid Per Share | Shares Purchased as Part of Publicly Announced Program | Approximate Dollar Value Remaining Under Program | | :--- | :--- | :--- | :--- | :--- | | May 2019 | 891 | $46.34 | — | $250.7 million | | June 2019 | 720 | $45.73 | — | $250.7 million | | July 2019 | 544,143 | $39.06 | 324,100 | $238.0 million | | **Total** | **545,754** | **$39.08** | **324,100** | | - The Board of Directors approved an increase to the share repurchase program to an aggregate of **$250 million** on March 6, 2019. The program has no expiration date[201](index=201&type=chunk) [Exhibits](index=39&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL documents

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Delaware 95-2623879 (State or Other Jurisdiction of Incorporation or Organization) (I.R.S. Employer Identification No.) Washington, D.C. 20549 Form 10-K ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended April 30, 2019 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____to _____ Commission File Number 001-14505 KORN FERRY (Ex ...

[Part I. Financial Information](index=3&type=section&id=Part%20I%2E%20Financial%20Information) [Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) Korn Ferry's financial statements for Q3 and nine months ended January 31, 2019, reflect increased fee revenue but a significant net income decline due to a $106.6 million impairment charge [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) As of January 31, 2019, total assets decreased to **$2.22 billion** from **$2.29 billion**, primarily due to lower cash and intangible assets Consolidated Balance Sheet Highlights (in thousands) | Account | Jan 31, 2019 (unaudited) | Apr 30, 2018 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $489,509 | $520,848 | | Goodwill | $580,021 | $584,222 | | Intangible assets, net | $86,308 | $203,216 | | **Total Assets** | **$2,217,553** | **$2,287,914** | | **Liabilities & Equity** | | | | Compensation and benefits payable | $266,925 | $304,980 | | Long-term debt | $222,662 | $211,311 | | **Total Liabilities** | **$1,010,513** | **$1,068,299** | | **Total Stockholders' Equity** | **$1,207,040** | **$1,219,615** | [Consolidated Statements of Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income) Q3 FY2019 fee revenue grew **6.0%** to **$474.5 million**, with net income increasing, while nine-month net income fell to **$52.4 million** due to a significant impairment charge Income Statement Summary (in thousands, except per share data) | Metric | Q3 FY2019 | Q3 FY2018 | Nine Months FY2019 | Nine Months FY2018 | | :--- | :--- | :--- | :--- | :--- | | Fee Revenue | $474,504 | $447,581 | $1,435,277 | $1,291,853 | | Operating Income | $62,683 | $49,846 | $78,551 | $144,249 | | Net Income Attributable to Korn Ferry | $44,964 | $27,247 | $52,387 | $92,619 | | Diluted EPS | $0.80 | $0.48 | $0.92 | $1.63 | | Cash Dividends Declared per Share | $0.10 | $0.10 | $0.30 | $0.30 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended January 31, 2019, net cash from operating activities significantly increased to **$101.0 million**, while investing and financing activities resulted in net cash outflows Cash Flow Summary for Nine Months Ended Jan 31 (in thousands) | Activity | 2019 | 2018 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $100,957 | $59,592 | | Net Cash used in Investing Activities | ($59,501) | ($32,184) | | Net Cash used in Financing Activities | ($57,759) | ($64,558) | | **Net Decrease in Cash** | **($31,339)** | **($20,892)** | [Notes to Consolidated Unaudited Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Unaudited%20Financial%20Statements) Notes detail significant accounting policies, including ASC 606 adoption, a major rebranding resulting in a **$106.6 million** impairment charge, and a new **$650 million** credit facility - The company rebranded to a single master brand, "Korn Ferry," sunsetting sub-brands like Futurestep and Hay Group, leading to a non-cash intangible asset impairment charge of **$106.6 million** for discontinued tradenames[22](index=22&type=chunk)[47](index=47&type=chunk) - The company adopted the new revenue recognition standard, ASC 606, on May 1, 2018, resulting in a cumulative increase to retained earnings of **$6.7 million**, net of tax[56](index=56&type=chunk)[57](index=57&type=chunk) - On December 19, 2018, the company entered into a new **$650 million** five-year senior secured revolving credit facility and used a **$226.9 million** drawdown to pay off its previous term loan[127](index=127&type=chunk) - Subsequent to the quarter end, on March 6, 2019, the Board declared a quarterly cash dividend of **$0.10 per share** and increased the share repurchase program by approximately **$200 million**, bringing the total authorization to about **$250 million**[132](index=132&type=chunk)[133](index=133&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q3 FY2019 performance, highlighting a **6%** fee revenue increase to **$474.5 million** and a **26%** operating income rise, despite a **$106.6 million** tradename write-off impacting nine-month results [Executive Summary](index=28&type=section&id=Executive%20Summary) Korn Ferry unified its market presence under a single brand, resulting in a **$106.6 million** tradename write-off, while Q3 FY19 fee revenue grew **6%** to **$474.5 million** and Adjusted EBITDA reached **$77.7 million** - The company is unifying its market strategy under a single "Korn Ferry" master brand, discontinuing sub-brands such as Futurestep, Hay Group, and Lominger[139](index=139&type=chunk) - As a result of the rebranding, the company took a one-time, non-cash write-off of tradenames amounting to **$106.6 million** during the nine months ended January 31, 2019[139](index=139&type=chunk) Q3 FY2019 Key Metrics | Metric | Value (in millions) | | :--- | :--- | | Fee Revenue | $474.5 | | Operating Income | $62.7 | | Net Income Attributable to Korn Ferry | $45.0 | | Adjusted EBITDA | $77.7 | [Results of Operations](index=30&type=section&id=Results%20of%20Operations) Q3 fee revenue increased **6%** year-over-year, with operating income rising **26%** to **$62.7 million**, though nine-month operating income fell to **$78.6 million** due to a **$106.6 million** tradename impairment Fee Revenue Growth by Segment (Q3 FY2019 vs Q3 FY2018) | Segment | Fee Revenue (Q3'19) | Growth (YoY) | | :--- | :--- | :--- | | Executive Search | $193.4M | 7% | | Advisory | $201.5M | 2% | | RPO & Professional Search | $79.6M | 15% | | **Total** | **$474.5M** | **6%** | Operating Income (Loss) by Segment (Nine Months Ended Jan 31) | Segment | FY2019 (in millions) | FY2018 (in millions) | | :--- | :--- | :--- | | Executive Search | $137.0 | $102.6 | | Advisory | ($24.4) | $72.5 | | RPO & Professional Search | $36.3 | $27.7 | | **Total Operating Income** | **$78.6** | **$144.2** | - The nine-month operating income for the Advisory segment swung to a loss of **$24.4 million** from an income of **$72.5 million** in the prior year, primarily due to the **$106.6 million** tradename write-off; excluding this charge, operating income would have been approximately **$82.2 million**[214](index=214&type=chunk)[206](index=206&type=chunk) [Liquidity and Capital Resources](index=42&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a balanced capital allocation strategy, enhanced by a new **$650 million** credit agreement with **$420.2 million** available, and increased its share repurchase authorization to approximately **$250 million** - The company's capital allocation priorities are: 1) investing in growth, 2) returning capital to stockholders via dividends, and 3) opportunistic share repurchases[227](index=227&type=chunk) - Entered into a new **$650 million** Amended and Restated Credit Agreement on December 19, 2018; as of January 31, 2019, **$226.9 million** was drawn, leaving **$420.2 million** available[228](index=228&type=chunk) - On March 6, 2019, the Board approved a **$200 million** increase to the share repurchase program, bringing the total available capacity to approximately **$250 million**[231](index=231&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=45&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from foreign currency fluctuations, where a **10%** adverse change could result in a **$10.3 million** loss, and interest rate changes, partially mitigated by an interest rate swap - The company's primary foreign currency exposures are to the Canadian Dollar, Euro, Pound Sterling, Swiss Franc, Singapore Dollar, Brazilian Real, and Mexican Peso; a hypothetical **10%** adverse change in these exchange rates could result in a foreign exchange loss of **$10.3 million**[259](index=259&type=chunk) - Interest rate risk exists on the **$226.9 million** outstanding under the variable-rate Revolver; this risk is partially mitigated by an interest rate swap with a notional amount of **$110.0 million**, maturing June 15, 2021, which locks the interest rate at **1.919%** (exclusive of credit spread) on that portion of the debt[260](index=260&type=chunk)[262](index=262&type=chunk) [Controls and Procedures](index=46&type=section&id=Item%204.%20Controls%20and%20Procedures) The CEO and CFO concluded that the company's disclosure controls and procedures are effective, with no material changes in internal control over financial reporting during the quarter - The CEO and CFO have concluded that the company's disclosure controls and procedures are effective as of January 31, 2019[264](index=264&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, internal controls[264](index=264&type=chunk) [Part II. Other Information](index=47&type=section&id=Part%20II.%20Other%20Information) [Legal Proceedings](index=47&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in routine litigation but is not currently engaged in any legal proceedings expected to have a material adverse effect on its business or financial condition - As of the report date, the company is not engaged in any legal proceedings that are expected to have a material adverse effect on its business or financial condition[267](index=267&type=chunk) [Risk Factors](index=47&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the fiscal year ended April 30, 2018 - No material changes have occurred to the risk factors described in the company's Form 10-K for the year ended April 30, 2018[268](index=268&type=chunk) [Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities](index=47&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%20and%20Issuer%20Purchases%20of%20Equity%20Securities) During Q3 FY2019, the company repurchased **503,027 shares** for **$21.9 million**, and subsequently increased its share repurchase authorization by **$200 million** to approximately **$250 million** Issuer Purchases of Equity Securities (Quarter Ended Jan 31, 2019) | Period | Total Shares Purchased | Average Price Paid Per Share | Shares Purchased as Part of Publicly Announced Program | | :--- | :--- | :--- | :--- | | Nov 2018 | — | $— | — | | Dec 2018 | 454,023 | $44.05 | 304,500 | | Jan 2019 | 49,004 | $39.59 | 48,300 | | **Total** | **503,027** | **$43.62** | **352,800** | - On March 6, 2019, the Board of Directors approved an increase to the share repurchase program of approximately **$200 million**, bringing the total available capacity to approximately **$250 million**[270](index=270&type=chunk) [Exhibits](index=48&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including amendments to corporate documents, the new Credit Agreement, and CEO/CFO certifications - Key exhibits filed include the Amended and Restated Credit Agreement dated December 19, 2018, and CEO/CFO certifications pursuant to Sarbanes-Oxley[271](index=271&type=chunk) [Signatures](index=49&type=section&id=Signatures) The Form 10-Q report was signed on March 11, 2019, by Robert P. Rozek, Executive Vice President, Chief Financial Officer, and Chief Corporate Officer of Korn Ferry - The report was signed on March 11, 2019, by Robert P. Rozek, EVP, CFO, and Chief Corporate Officer[274](index=274&type=chunk)