Korn Ferry (NYSE:KFY) Q1 2026 Earnings Call September 09, 2025 12:00 PM ET Company ParticipantsTobey Sommer - Managing DirectorGary Burnison - CEOBob Rozek - CFOConference Call ParticipantsTrevor Romeo - Equity Research AnalystSamuel Wisner - Investment Banking AnalystMark Marcon - Senior Research AnalystJosh Chan - Equity Research AnalystOperatorLadies and gentlemen, thank you for standing by and welcome to the Korn Ferry first quarter fiscal year 2026 conference call. At this time, all participants are in ...

Financial Data and Key Metrics Changes - Consolidated fee revenue grew 5% year over year to $709 million, marking the second consecutive quarter of positive growth [12] - Adjusted EBITDA increased by $9 million, or 8% year over year, to $120 million, with an adjusted EBITDA margin growth of 50 basis points year over year to 17% [12] - Adjusted diluted earnings per share rose by $0.13, or 11% year over year, to $1.31 [12] Business Line Data and Key Metrics Changes - Executive Search fee revenue grew 8% year over year, marking the fifth consecutive quarter of growth in this area [11] - Professional Search and Interim fee revenue increased by 10% year over year, with Professional Services per employee up 5% and Interim up 14% [11] - Digital subscription and licensed new business grew 10% year over year, contributing to 39% of total digital new business [11] Market Data and Key Metrics Changes - Fee revenue in the Americas decreased by 2% year over year, while EMEA fee revenue grew by 19% and APAC fee revenue increased by 12% [14][15] - Total company new business, excluding RPO, grew 5% year over year, with strength noted in EMEA and APAC [13] Company Strategy and Development Direction - The company is focused on a diversification strategy that enhances resilience and durability, contributing to sustained shareholder value [8] - The upcoming launch of the TalentSuite platform is expected to enhance the delivery of integrated solutions and improve client engagement [10] - The company aims to increase the proportion of digital subscriptions to over 60% in the long term [21] Management's Comments on Operating Environment and Future Outlook - The management expressed optimism about the company's trajectory despite ongoing economic uncertainties, emphasizing the importance of their integrated business strategy [9] - The outlook for the second quarter of fiscal 2026 anticipates fee revenue to range from $690 million to $710 million, with adjusted EBITDA margins expected between 17% and 17.5% [15][16] - Management noted that the current economic environment presents opportunities for strengthening client relationships and addressing complex talent challenges [9] Other Important Information - The company returned $36 million to shareholders through share repurchases and dividends, while investing $22 million in capital expenditures focused on TalentSuite and productivity tools [15] - Estimated remaining fees under existing contracts amounted to $1.67 billion, up 9% year over year, with expectations for approximately 58% to be recognized as fees within the next year [14] Q&A Session Summary Question: Key milestones for TalentSuite rollout and timeline for financial benefits - Management indicated that true benefits from TalentSuite are expected towards the end of calendar 2026, with key milestones including partnerships and training for consultants [19] Question: Long-term aspirational target for digital subscriptions - The company aims for digital subscriptions to exceed 60% of segment revenue in the long term, leveraging partnerships for growth [21] Question: Guidance for Q2 revenue and potential conservatism - Management acknowledged a conservative approach in guidance due to uncertainties in the economic backdrop [24] Question: Client feedback on economic uncertainty and job creation - Management noted optimism in the Americas but acknowledged challenges in pricing power and labor market dynamics [28] Question: Performance of Consulting new business and outlook - Management expects continued momentum in Europe and Asia for consulting solutions, while the Americas may face challenges [39] Question: Impact of AI on workforce and consulting services - Management discussed the dual impact of AI on reducing headcount and enhancing efficiency in service delivery [66][70] Question: Performance of Executive Search in North America - The Executive Search segment is benefiting from demographic shifts and changes in leadership needs post-COVID [45] Question: Opportunities in Professional Search and Interim Solutions - Management sees significant opportunities in Professional Search and Interim Solutions, particularly outside the U.S. [59]

Korn Ferry (NYSE:KFY) Q1 2026 Earnings Call September 09, 2025 12:00 PM ET Company ParticipantsTobey Sommer - Managing DirectorGary Burnison - CEOBob Rozek - CFOConference Call ParticipantsTrevor Romeo - Equity Research AnalystSamuel Wisner - Investment Banking AnalystMark Marcon - Senior Research AnalystJosh Chan - Equity Research AnalystOperatorLadies and gentlemen, thank you for standing by and welcome to the Korn Ferry first quarter fiscal year 2026 conference call. At this time, all participants are in ...

Financial Data and Key Metrics Changes - Consolidated fee revenue grew 5% year over year to $709 million, marking the second consecutive quarter of positive growth [11] - Adjusted EBITDA increased by $9 million, or 8% year over year, reaching $120 million, with an adjusted EBITDA margin growth of 50 basis points to 17% [11] - Adjusted diluted earnings per share rose by $0.13, or 11% year over year, to $1.31 [11] Business Line Data and Key Metrics Changes - Executive Search fee revenue grew 8% year over year, marking the fifth consecutive quarter of growth in this area [10] - Professional Search and Interim fee revenue increased by 10% year over year, with Professional Services per employee up 5% and Interim up 14% [10] - Digital subscription and licensed new business grew 10% year over year, contributing to 39% of total digital new business [10] Market Data and Key Metrics Changes - Fee revenue in the Americas decreased by 2% year over year, while EMEA fee revenue grew by 19% and APAC fee revenue increased by 12% [12][13] - Estimated remaining fees under existing contracts rose by 9% year over year to $1.67 billion, with 58% expected to be recognized as fees within the next year [12] Company Strategy and Development Direction - The company is focused on a diversification strategy that enhances resilience and durability, contributing to sustained shareholder value [7] - The launch of the TalentSuite platform is expected to enhance service delivery and client engagement, with a market launch planned for November [9] - The company aims to increase the proportion of digital subscriptions to over 60% in the long term [19] Management's Comments on Operating Environment and Future Outlook - The management expressed optimism about the company's trajectory despite ongoing economic uncertainties, emphasizing the importance of their integrated business strategy [8] - The outlook for the second quarter of fiscal 2026 anticipates fee revenue between $690 million and $710 million, with adjusted EBITDA margins expected to range from 17% to 17.5% [14] - Management noted that the current economic environment presents opportunities for strengthening client relationships and addressing complex organizational challenges [8] Other Important Information - The company returned $36 million to shareholders through share repurchases and dividends, while investing $22 million in capital expenditures focused on TalentSuite and productivity tools [13] - The company has a balanced capital allocation strategy, evidenced by six dividend increases in the last five years [7] Q&A Session Summary Question: What are the key milestones for the TalentSuite rollout? - The benefits of TalentSuite are expected to materialize towards the end of calendar 2026, with milestones including partnerships and training for consultants [17] Question: What is the long-term target for digital subscriptions? - The company aims for digital subscriptions to exceed 60% of segment revenue in the long term [19] Question: What are clients saying about the economic environment? - Clients express optimism in the Americas, while facing challenges such as lack of pricing power and rising costs [26] Question: How is the consulting business performing? - The consulting market remains challenging, but there is momentum in Europe and Asia, with a focus on larger, integrated solutions [34] Question: How is AI impacting the workforce? - Management believes AI will lead to a reduction in workforce size, but it will also free up capacity to deliver services more efficiently [64][66]

Financial Performance - Fee revenue reached $709 million, a 5% year-over-year increase[15] - Adjusted EBITDA was $120 million, up 8% year-over-year[15] - Adjusted diluted EPS increased by 11% year-over-year to $1.31[15] - Digital solutions contributed over $360 million in sales, representing over 13% of total fee revenue[14] Segment Performance - Executive Search fee revenue increased by 8% year-over-year[15] - Professional Search & Interim fee revenue grew by 10% year-over-year[15] - Consulting fee revenue increased by 1% year-over-year[15] - RPO (Recruitment Process Outsourcing) fee revenue increased by 3% year-over-year[15] Regional Performance - EMEA (Europe, Middle East, and Africa) experienced a 19% year-over-year increase in fee revenue[15] - APAC (Asia-Pacific) saw a 12% year-over-year increase in fee revenue[15] - Americas experienced a 2% year-over-year decrease in fee revenue[15] Contracts and New Business - Estimated remaining fees under existing contracts totaled $1711 million[16] - RPO new business was $99 million, with 46% coming from new logos[17] Capital Allocation - The company deployed $67 million of cash, including $22 million in CAPEX, $9 million in debt service, and $36 million returned to shareholders through dividends and share repurchases[49]

Shares of Korn Ferry (NYSE: KFY ) have been a solid performer over the past year, gaining nearly 10%. While the U.S. labor market has definitely slowed, Korn Ferry’s diverse and global footprint has made its own financial resultsOver fifteen years of experience making contrarian bets based on my macro view and stock-specific turnaround stories to garner outsized returns with a favorable risk/reward profile. If you want me to cover a specific stock or have a question for an article, just let me know!Analyst’ ...

Shares of Korn Ferry (NYSE: KFY ) have been a solid performer over the past year, gaining nearly 10%. While the U.S. labor market has definitely slowed, Korn Ferry’s diverse and global footprint has made its own financial resultsOver fifteen years of experience making contrarian bets based on my macro view and stock-specific turnaround stories to garner outsized returns with a favorable risk/reward profile. If you want me to cover a specific stock or have a question for an article, just let me know!Analyst’ ...

For the quarter ended July 2025, Korn/Ferry (KFY) reported revenue of $708.61 million, up 5% over the same period last year. EPS came in at $1.31, compared to $1.18 in the year-ago quarter.The reported revenue represents a surprise of +3.43% over the Zacks Consensus Estimate of $685.13 million. With the consensus EPS estimate being $1.24, the EPS surprise was +5.65%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expecta ...

Korn/Ferry (KFY) came out with quarterly earnings of $1.31 per share, beating the Zacks Consensus Estimate of $1.24 per share. This compares to earnings of $1.18 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of +5.65%. A quarter ago, it was expected that this staffing company would post earnings of $1.26 per share when it actually produced earnings of $1.32, delivering a surprise of +4.76%.Over the last four quarters, the compa ...

[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) [First Quarter Fiscal 2026 Results Overview](index=1&type=section&id=First%20Quarter%20Fiscal%202026%20Results%20Overview) Korn Ferry announced strong first quarter fiscal 2026 results, with fee revenue reaching $708.6 million, diluted EPS at $1.26, and adjusted diluted EPS at $1.31, demonstrating the effectiveness of its strategic approach amidst a dynamic labor and economic environment - Korn Ferry reported first quarter fee revenue of **$708.6 million**[2](index=2&type=chunk) - Diluted earnings per share was **$1.26** and adjusted diluted earnings per share was **$1.31**[2](index=2&type=chunk) [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Gary D. Burnison expressed satisfaction with the company's performance, attributing success to a sophisticated, holistic strategy that leverages expertise, robust IP, and relevant solutions globally. He highlighted the immense opportunity driven by diversification and demographic shifts - CEO Gary D. Burnison stated that the company's strategy is working, driving performance with a sophisticated, holistic approach[3](index=3&type=chunk) - The strategy brings together expertise, robust IP, and relevant solutions globally to address client challenges[3](index=3&type=chunk) - The CEO emphasized the immense opportunity for Korn Ferry due to its diversification strategy and demographic shifts[3](index=3&type=chunk) [Key Financial Highlights](index=1&type=section&id=Key%20Financial%20Highlights) Korn Ferry achieved significant year-over-year growth in Q1 FY'26, with fee revenue up 5% to $708.6 million, net income increasing 6% to $66.6 million, and adjusted EBITDA rising 8% to $120.4 million. Diluted EPS and adjusted diluted EPS also saw increases of 8% and 11% respectively Q1 FY'26 Key Financial Highlights (YoY Change) | Metric | Q1 FY'26 Value | YoY Change (Actual) | YoY Change (Constant Currency) | | :-------------------------------- | :---------------- | :------------------ | :----------------------------- | | Fee revenue | $708.6 million | +5% | +4% | | Net income attributable to Korn Ferry | $66.6 million | +6% | N/A | | Net income margin | 9.4% | +10bps | N/A | | Adjusted EBITDA | $120.4 million | +8% | N/A | | Adjusted EBITDA margin | 17.0% | +50bps | N/A | | Diluted earnings per share | $1.26 | +8% | N/A | | Adjusted diluted earnings per share | $1.31 | +11% | N/A | | Shares repurchased | 145,770 shares | N/A | N/A | | Value of shares repurchased | $9.9 million | N/A | N/A | [Consolidated Financial Performance](index=2&type=section&id=Consolidated%20Financial%20Performance) [Selected Consolidated Financial Results](index=2&type=section&id=Selected%20Consolidated%20Financial%20Results) Korn Ferry reported Q1 FY'26 fee revenue of $708.6 million, a 5% increase year-over-year, primarily driving a 10bps increase in net income margin to 9.4% and a 50bps increase in Adjusted EBITDA margin to 17.0%. Estimated remaining fees under existing contracts also grew to $1,674.1 million Selected Consolidated Financial Results (Q1 FY'26 vs Q1 FY'25) | Metric | Q1 FY'26 | Q1 FY'25 | | :------------------------------------------ | :------- | :------- | | Fee revenue | $708.6 | $674.9 | | Total revenue | $715.5 | $682.8 | | Estimated remaining fees under existing contracts | $1,674.1 | $1,532.6 | | Net income attributable to Korn Ferry | $66.6 | $62.6 | | Net income attributable to Korn Ferry margin | 9.4% | 9.3% | | Basic earnings per share | $1.28 | $1.19 | | Diluted earnings per share | $1.26 | $1.17 | | Adjusted EBITDA | $120.4 | $111.2 | | Adjusted EBITDA margin | 17.0% | 16.5% | | Adjusted net income attributable to Korn Ferry | $69.2 | $63.1 | | Adjusted basic earnings per share | $1.33 | $1.20 | | Adjusted diluted earnings per share | $1.31 | $1.18 | - Fee revenue in Q1 FY'26 increased by **5%** year-over-year (**4.0%** at constant currency) to **$708.6 million**[8](index=8&type=chunk) - Net income attributable to Korn Ferry margin increased by **10bps** year-over-year to **9.4%**, primarily due to increased fee revenue[8](index=8&type=chunk) - Adjusted EBITDA margin increased by **50bps** year-over-year to **17.0%**, also primarily due to increased fee revenue[9](index=9&type=chunk) [GAAP Consolidated Statements of Income](index=11&type=section&id=GAAP%20Consolidated%20Statements%20of%20Income) Korn Ferry's consolidated statements of income for Q1 FY'26 show a 4.8% increase in total revenue to $715.5 million, with operating income rising to $83.4 million. Net income attributable to Korn Ferry grew to $66.6 million, resulting in diluted EPS of $1.26 Condensed Consolidated Statements of Income (Three Months Ended July 31) | Metric (in thousands) | 2025 (unaudited) | 2024 | | :------------------------------------ | :--------------- | :----- | | Fee revenue | $708,613 | $674,946 | | Reimbursed out-of-pocket engagement expenses | $6,930 | $7,815 | | Total revenue | $715,543 | $682,761 | | Compensation and benefits | $461,411 | $451,775 | | General and administrative expenses | $63,874 | $59,999 | | Reimbursed expenses | $6,930 | $7,815 | | Cost of services | $77,194 | $67,544 | | Depreciation and amortization | $22,686 | $19,578 | | Total operating expenses | $632,095 | $606,711 | | Operating income | $83,448 | $76,050 | | Other income, net | $12,752 | $14,505 | | Interest expense, net | $(3,516) | $(3,945) | | Income before provision for income taxes | $92,684 | $86,610 | | Income tax provision | $25,250 | $22,354 | | Net income | $67,434 | $64,256 | | Net income attributable to noncontrolling interest | $(798) | $(1,652) | | Net income attributable to Korn Ferry | $66,636 | $62,604 | | Basic earnings per share | $1.28 | $1.19 | | Diluted earnings per share | $1.26 | $1.17 | | Weighted-average common shares outstanding (Basic) | 51,466 | 51,950 | | Weighted-average common shares outstanding (Diluted) | 52,368 | 52,745 | [GAAP Consolidated Balance Sheets](index=13&type=section&id=GAAP%20Consolidated%20Balance%20Sheets) As of July 31, 2025, Korn Ferry's total assets were $3,630.6 million, a decrease from April 30, 2025, primarily due to a reduction in cash and cash equivalents. Total liabilities also decreased to $1,731.8 million, while total stockholders' equity increased to $1,898.8 million Condensed Consolidated Balance Sheets (in thousands) | Metric | July 31, 2025 (unaudited) | April 30, 2025 (audited) | | :------------------------------------------ | :------------------------ | :----------------------- | | **ASSETS** | | | | Cash and cash equivalents | $684,855 | $1,006,964 | | Total current assets | $1,490,902 | $1,750,138 | | Total assets | $3,630,597 | $3,861,224 | | **LIABILITIES AND STOCKHOLDERS' EQUITY** | | | | Compensation and benefits payable | $266,671 | $530,473 | | Total current liabilities | $674,400 | $955,598 | | Total liabilities | $1,731,784 | $1,989,085 | | Total Korn Ferry stockholders' equity | $1,892,088 | $1,866,456 | | Total stockholders' equity | $1,898,813 | $1,872,139 | | Total liabilities and stockholders' equity | $3,630,597 | $3,861,224 | [Reconciliation of GAAP to Non-GAAP Measures](index=14&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Measures) Korn Ferry provides non-GAAP financial measures, including Adjusted EBITDA and Adjusted Net Income, to offer a clearer view of ongoing operating results by excluding integration/acquisition costs and accelerated depreciation on its Digital platform. For Q1 FY'26, Adjusted EBITDA was $120.4 million and Adjusted diluted EPS was $1.31 Reconciliation of GAAP to Non-GAAP Financial Measures (Three Months Ended July 31) | Metric (in thousands, except per share) | 2025 | 2024 | | :------------------------------------------ | :--- | :--- | | Net income attributable to Korn Ferry | $66,636 | $62,604 | | Integration/acquisition costs (1) | $1,508 | $1,076 | | Accelerated depreciation on Digital platform (2) | $1,977 | — | | Tax effect on the adjusted items (3) | $(883) | $(560) | | Adjusted net income attributable to Korn Ferry | $69,238 | $63,120 | | Diluted earnings per common share | $1.26 | $1.17 | | Adjusted diluted earnings per share | $1.31 | $1.18 | | Adjusted EBITDA | $120,394 | $111,209 | | Adjusted EBITDA margin | 17.0% | 16.5% | - Non-GAAP measures adjust for integration/acquisition costs and accelerated depreciation on the Digital platform to provide meaningful supplemental information on ongoing operating results[42](index=42&type=chunk) - Accelerated depreciation of **$2.0 million** in Q1 FY'26 is associated with the decision to sunset the Digital platform upon the introduction of the Korn Ferry Talent Suite platform, expected in Q3 FY'26[7](index=7&type=chunk) [Results by Solution](index=3&type=section&id=Results%20by%20Solution) [Consulting](index=3&type=section&id=Consulting) Consulting fee revenue increased by 1% year-over-year to $170.0 million in Q1 FY'26, driven by a 9% increase in average bill rates due to a shift towards larger, longer-duration engagements. However, Adjusted EBITDA decreased by 1.7% to $28.8 million, with the margin declining by 50bps to 17.0% Selected Consulting Data (Q1 FY'26 vs Q1 FY'25) | Metric | Q1 FY'26 | Q1 FY'25 | | :------------------------------------------ | :------- | :------- | | Fee revenue | $170.0 | $167.9 | | Total revenue | $172.7 | $170.8 | | Estimated remaining fees under existing contracts | $372.3 | $349.3 | | Ending number of consultants and execution staff | 1,550 | 1,663 | | Hours worked in thousands | 367 | 395 | | Average bill rate | $463 | $425 | | Adjusted EBITDA | $28.8 | $29.3 | | Adjusted EBITDA margin | 17.0% | 17.5% | - Consulting fee revenue increased by **1%** year-over-year, primarily due to a **9%** increase in average bill rates, reflecting a shift to larger and longer duration engagements[13](index=13&type=chunk) - Adjusted EBITDA margin for Consulting decreased by **50bps** year-over-year to **17.0%**[14](index=14&type=chunk) [Digital](index=4&type=section&id=Digital) Digital fee revenue grew 1% year-over-year to $89.2 million in Q1 FY'26, with subscription & license fee revenue increasing to $37.2 million. Adjusted EBITDA for the Digital segment rose to $27.6 million, and its margin improved by 80bps to 31.0% Selected Digital Data (Q1 FY'26 vs Q1 FY'25) | Metric | Q1 FY'26 | Q1 FY'25 | | :------------------------------------------ | :------- | :------- | | Fee revenue | $89.2 | $88.2 | | Total revenue | $89.2 | $88.2 | | Estimated remaining fees under existing contracts | $398.0 | $372.1 | | Ending number of consultants | 225 | 259 | | Subscription & License fee revenue | $37.2 | $34.1 | | Adjusted EBITDA | $27.6 | $26.6 | | Adjusted EBITDA margin | 31.0% | 30.2% | - Digital fee revenue increased by **1%** year-over-year to **$89.2 million** (down **1%** at constant currency)[17](index=17&type=chunk) - Adjusted EBITDA margin for Digital increased by **80bps** year-over-year to **31.0%**[17](index=17&type=chunk) [Executive Search](index=5&type=section&id=Executive%20Search) Executive Search reported a robust 8% year-over-year increase in fee revenue to $224.3 million in Q1 FY'26, primarily driven by a higher number of engagements billed. Adjusted EBITDA surged by 16% to $57.5 million, with the margin expanding by 190bps to 25.6% Selected Executive Search Data (Q1 FY'26 vs Q1 FY'25) | Metric | Q1 FY'26 | Q1 FY'25 | | :------------------------------------------ | :------- | :------- | | Fee revenue | $224.3 | $208.6 | | Total revenue | $226.3 | $210.4 | | Estimated remaining fees under existing contracts | $66.6 | $61.5 | | Ending number of consultants | 574 | 559 | | Average number of consultants | 567 | 551 | | Engagements billed | 3,751 | 3,448 | | New engagements | 1,596 | 1,556 | | Adjusted EBITDA | $57.5 | $49.4 | | Adjusted EBITDA margin | 25.6% | 23.7% | - Executive Search fee revenue increased by **8%** year-over-year (**6%** at constant currency) to **$224.3 million**, driven by an increase in engagements billed[22](index=22&type=chunk) - Adjusted EBITDA for Executive Search increased by **16%** year-over-year to **$57.5 million**, with the margin increasing by **190bps** to **25.6%**[23](index=23&type=chunk) [Executive Search Regional Performance](index=12&type=section&id=Executive%20Search%20Regional%20Performance) Executive Search experienced fee revenue growth across EMEA (17.0%), Asia Pacific (20.0%), and North America (3.6%) in Q1 FY'26, while Latin America saw a decline of 16.5% Executive Search Fee Revenue by Region (Q1 FY'26 vs Q1 FY'25) | Region | Q1 FY'26 Fee Revenue | Q1 FY'25 Fee Revenue | % Change | | :------------- | :------------------- | :------------------- | :------- | | North America | $139,654 | $134,752 | 3.6% | | EMEA | $53,781 | $45,981 | 17.0% | | Asia Pacific | $24,701 | $20,579 | 20.0% | | Latin America | $6,117 | $7,323 | (16.5%) | | Total Executive Search | $224,253 | $208,635 | 7.5% | - Executive Search experienced fee revenue growth in EMEA, North America, and APAC regions[22](index=22&type=chunk) [Professional Search & Interim](index=6&type=section&id=Professional%20Search%20%26%20Interim) Professional Search & Interim fee revenue increased by 10% year-over-year to $133.9 million in Q1 FY'26, primarily due to higher Interim fee revenue associated with the acquisition of Trilogy International. Adjusted EBITDA grew to $28.0 million, with the margin remaining essentially flat at 20.9% Selected Professional Search & Interim Data (Q1 FY'26 vs Q1 FY'25) | Metric | Q1 FY'26 | Q1 FY'25 | | :------------------------------------------ | :------- | :------- | | Fee revenue | $133.9 | $121.7 | | Total revenue | $135.1 | $122.7 | | Permanent Placement Fee revenue | $54.7 | $52.2 | | Interim Fee revenue | $79.2 | $69.5 | | Estimated remaining fees under existing contracts (Interim) | $93.3 | $79.4 | | Average weekly billable consultants (Interim) | 1,219 | 1,068 | | Adjusted EBITDA | $28.0 | $25.7 | | Adjusted EBITDA margin | 20.9% | 21.1% | - Professional Search & Interim fee revenue increased by **10%** year-over-year to **$133.9 million**, primarily due to higher Interim fee revenue associated with the acquisition of Trilogy International[26](index=26&type=chunk) - Adjusted EBITDA margin for Professional Search & Interim was **20.9%**, essentially flat year-over-year[27](index=27&type=chunk) [Recruitment Process Outsourcing (RPO)](index=7&type=section&id=Recruitment%20Process%20Outsourcing%20%28RPO%29) RPO fee revenue increased by 3% year-over-year to $91.3 million in Q1 FY'26, driven by new logo clients in North America. Adjusted EBITDA for RPO grew to $14.3 million, and its margin improved significantly by 160bps to 15.7% Selected Recruitment Process Outsourcing (RPO) Data (Q1 FY'26 vs Q1 FY'25) | Metric | Q1 FY'26 | Q1 FY'25 | | :------------------------------------------ | :------- | :------- | | Fee revenue | $91.3 | $88.5 | | Total revenue | $92.2 | $90.7 | | Estimated remaining fees under existing contracts | $728.8 | $656.1 | | RPO new business | $99.3 | $103.6 | | Adjusted EBITDA | $14.3 | $12.5 | | Adjusted EBITDA margin | 15.7% | 14.1% | - RPO fee revenue increased by **3%** year-over-year (**1%** at constant currency) to **$91.3 million**, primarily due to new logo clients in North America[30](index=30&type=chunk) - Adjusted EBITDA margin for RPO increased by **160bps** year-over-year to **15.7%**[31](index=31&type=chunk) [Outlook & Corporate Information](index=8&type=section&id=Outlook%20%26%20Corporate%20Information) [Q2 FY'26 Financial Outlook](index=8&type=section&id=Q2%20FY%2726%20Financial%20Outlook) Korn Ferry projects Q2 FY'26 fee revenue to be between $690 million and $710 million. Consolidated diluted earnings per share is expected to range from $1.10 to $1.16, with adjusted diluted earnings per share projected between $1.23 and $1.33 - Q2 FY'26 fee revenue is expected to be in the range of **$690 million** and **$710 million**[36](index=36&type=chunk) - Q2 FY'26 diluted earnings per share is expected to range between **$1.10** to **$1.16**[36](index=36&type=chunk) Q2 FY'26 Earnings Per Share Outlook | Metric | Low | High | | :---------------------------------------------------- | :---- | :---- | | Consolidated diluted earnings per share | $1.10 | $1.16 | | Integration/acquisition costs and accelerated depreciation on Digital platform | $0.19 | $0.23 | | Tax rate impact | $(0.06) | $(0.06) | | Consolidated adjusted diluted earnings per share | $1.23 | $1.33 | [Earnings Conference Call](index=8&type=section&id=Earnings%20Conference%20Call) Korn Ferry will host an earnings conference call on September 9, 2025, at 12:00 PM (EDT), featuring CEO Gary Burnison and other executives. The webcast and accompanying slides will be available on the investor relations section of their website - An earnings conference call will be held on September 9, 2025, at **12:00 PM (EDT)**[35](index=35&type=chunk) - The call will be hosted by CEO Gary Burnison, CFO Robert Rozek, SVP Business Development & Analytics Gregg Kvochak, and VP Investor Relations Tiffany Louder[35](index=35&type=chunk) - The conference call will be webcast and available online at ir.kornferry.com, along with earnings slides and other important information[35](index=35&type=chunk) [About Korn Ferry](index=9&type=section&id=About%20Korn%20Ferry) Korn Ferry is a global consulting firm focused on powering performance by unlocking potential in people and driving business transformation through synchronizing strategy, operations, and talent. They aim to accelerate performance, fuel growth, and inspire lasting change for clients across major industries - Korn Ferry is a global consulting firm that powers performance by unlocking potential in people and unleashing transformation across businesses[38](index=38&type=chunk) - The firm synchronizes strategy, operations, and talent to accelerate performance, fuel growth, and inspire a legacy of change[38](index=38&type=chunk) [Forward-Looking Statements](index=9&type=section&id=Forward-Looking%20Statements) This section cautions readers that statements regarding outlook, projections, goals, and future expectations are forward-looking and subject to various risks and uncertainties. These include global economic conditions, competition, labor market dynamics, regulatory changes, and technological advancements like AI, which could cause actual results to differ materially from current expectations - Statements regarding outlook, projections, goals, strategies, future plans, and expectations are forward-looking and involve risks and uncertainties[39](index=39&type=chunk) - Potential risks include global and local political/economic developments (inflation, trade wars, interest rates), labor market conditions, competition, geopolitical tensions, and changes in demand due to automation[39](index=39&type=chunk) - Korn Ferry disclaims any intention or obligation to update or revise any forward-looking statements[39](index=39&type=chunk) [Use of Non-GAAP Financial Measures](index=9&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) Korn Ferry utilizes non-GAAP financial measures, such as Adjusted net income, Adjusted EPS, constant currency percentages, and Adjusted EBITDA, to provide supplemental information on performance. These adjustments exclude items like integration/acquisition costs and accelerated depreciation, which management believes are not indicative of ongoing operating results, facilitating more meaningful period-to-period comparisons - Non-GAAP financial measures include Adjusted net income, Adjusted basic and diluted earnings per share, constant currency percentages, and Consolidated and Executive Search Adjusted EBITDA[41](index=41&type=chunk) - These measures exclude charges like integration/acquisition costs and accelerated depreciation on the Digital platform, which management believes are not indicative of ongoing operating results[42](index=42&type=chunk) - The use of non-GAAP measures aims to provide greater transparency, facilitate historical performance comparisons, and help investors identify operating trends by excluding the impact of exchange rate changes[42](index=42&type=chunk)