FTI Consulting (FCN) Q3 2025 Earnings Transcript

Core Insights - The company reported record results for Q3 2025, with earnings per share (EPS) and adjusted EPS of $2.6, reflecting a year-over-year increase of over 40% [5][41] - Despite facing headwinds in two of its business segments, the company achieved double-digit organic revenue growth across its core segments [40][41] - The leadership emphasized the importance of long-term investments in talent and capabilities, which have contributed to the company's resilience and growth trajectory [38][63] Financial Performance - Total revenue for Q3 2025 was $956.2 million, a 3.3% increase compared to the same quarter last year [41] - Net income rose to $82.8 million, marking a 25% increase year-over-year [41] - Adjusted EBITDA for Q3 2025 was $130.6 million, representing 13.7% of revenue, compared to 11.1% in the prior year quarter [42] Segment Performance - Corporate Finance (Corp Fin) revenue increased by 18.6% to $404.9 million, driven by higher demand for restructuring and transaction services [44] - FTI's Financial and Litigation Consulting (FLC) segment saw a revenue increase of 15.4% to $194.7 million, attributed to higher realized bill rates and demand for risk and investigation services [48] - The Economic Consulting segment experienced a revenue decline of 22% to $173.1 million, primarily due to lower demand for antitrust services [50] Strategic Focus - The company is committed to organic growth and enhancing its service offerings, particularly in high-demand areas such as cybersecurity and risk investigations [25][63] - Investments in talent acquisition have been prioritized, with 79 senior management and affiliate hires announced year-to-date, significantly higher than previous years [61][63] - The leadership believes in the potential for continued rate increases across all segments, although the pace may moderate compared to the current year [76] Guidance and Outlook - The company updated its full-year 2025 revenue guidance to a range of $3.685 billion to $3.735 billion, with EPS expected between $7.62 and $8.12 [60] - The fourth quarter is typically weaker due to seasonal business slowdowns, but the company remains optimistic about stabilizing its economic consulting business and gradual revenue growth [61][63] - The leadership expressed confidence in the long-term growth potential of the company, emphasizing resilience and the ability to navigate market challenges [38][63]