Korn Ferry(US:KFY)2025-12-09 11:50Financial Performance - Korn Ferry reported Q2 FY'26 fee revenue of $721.7 million, a 7% increase year-over-year, with 6% growth at constant currency[4]. - Net income attributable to Korn Ferry was $72.4 million, up 19% year-over-year, with a margin of 10.0%, an increase of 100bps[4][8]. - Adjusted EBITDA for Q2 FY'26 was $124.8 million, reflecting a 7% increase year-over-year, with an adjusted EBITDA margin of 17.3%[4][10]. - Korn Ferry reported total revenue of $729.8 million for the three months ended October 31, 2025, representing a 7.0% increase compared to $681.96 million for the same period in 2024[43]. - Fee revenue for the six months ended October 31, 2025, was $1.43 billion, up 6.0% from $1.35 billion in the prior year[45]. - Net income attributable to Korn Ferry for the three months ended October 31, 2025, was $72.4 million, a 19.2% increase from $60.8 million in the same quarter of 2024[43]. - Adjusted EBITDA for the six months ended October 31, 2025, reached $245.2 million, up 7.4% from $228.2 million in the prior year[49]. - The total fee revenue for the three months ended October 31, 2025, was $721.7 million, slightly down from $729.8 million in the same period of 2024[53]. - The adjusted EBITDA margin for the three months ended October 31, 2025, was 17.3%, compared to 17.4% in the same period of 2024[53]. Segment Performance - Executive Search fee revenue was $226.0 million in Q2 FY'26, a 9.7% increase from $206.0 million in Q2 FY'25[19]. - Consulting fee revenue increased to $172.8 million in Q2 FY'26, up 4% year-over-year, driven by a 10% rise in average bill rates[11][12]. - Digital segment fee revenue was $91.0 million in Q2 FY'26, a decrease of 2% from $92.9 million in Q2 FY'25[15][16]. - In the Professional Search & Interim segment, fee revenue reached $141.1 million in Q2 FY'26, a 17% increase from Q2 FY'25, primarily due to higher revenue from Interim services[24]. - RPO fee revenue for Q2 FY'26 was $90.8 million, a 4% increase from Q2 FY'25, attributed to new logo clients in North America[28]. - The Consulting segment saw a fee revenue increase of 3.6% to $172.8 million for the three months ended October 31, 2025[45]. - The Executive Search segment's fee revenue increased by 9.7% to $225.9 million for the same period[45]. Engagements and Contracts - Estimated remaining fees under existing contracts reached $1.842 billion, a 20% increase year-over-year[4]. - New engagements in Executive Search increased to 1,633 in Q2 FY'26, compared to 1,567 in Q2 FY'25[19]. - New engagements in the Professional Search segment totaled 1,004 in Q2 FY'26, compared to 947 in Q2 FY'25, indicating strong growth in client demand[23]. - Estimated remaining fees under existing contracts in the RPO segment were $886.9 million, significantly higher than $659.2 million in the previous year[27]. Earnings and Shares - Adjusted diluted earnings per share for Q2 FY'26 were $1.33, a 10% increase year-over-year[4]. - The company expects Q3 FY'26 fee revenue to be in the range of $680 million to $694 million, with diluted earnings per share projected between $1.15 to $1.21[34]. - The company reported a basic earnings per share of $1.38 for the three months ended October 31, 2025, compared to $1.16 in the same period of 2024[43]. - The adjusted net income attributable to Korn Ferry for the three months ended October 31, 2025, was $70.5 million, compared to $64.7 million in the same period of 2024, reflecting a 9.0% increase[49]. Assets and Liabilities - Korn Ferry's cash and cash equivalents decreased to $761.6 million as of October 31, 2025, down from $1.01 billion in April 2025[47]. - Total assets decreased to $3.72 billion as of October 31, 2025, compared to $3.86 billion in April 2025[47]. - The company reported that total liabilities decreased to $1.77 billion as of October 31, 2025, from $1.99 billion in April 2025[47]. Cost Management - The company incurred integration/acquisition costs of $1.3 million for the three months ended October 31, 2025, down from $3.9 million in the same period of 2024[49].