LOS ANGELES – Global management consulting firm Korn Ferry (NYSE:) reported better-than-expected first-quarter results Thursday, but gave mixed guidance for the current quarter.
Korn Ferry posted adjusted earnings per share of $1.18 for the quarter ended July 31, beating analyst expectations of $1.12. Revenue came in at $682.8 million, also beating the consensus forecast of $664.4 million.
However, fee income declined 3% year over year to $674.9 million, or 2% at constant exchange rates. The company attributed this decline primarily to lower fee income in the Professional Search & Interim and RPO segments due to reduced demand in the current economic climate.
“I am pleased with our first quarter results as we generated $675 million in fee revenue,” said CEO Gary D. Burnison. He highlighted that profits and profitability increased year-on-year, with adjusted EBITDA of $111 million at a margin of 16.5%, marking the fifth consecutive quarter of profitability improvement.
Executive Search fee revenues increased 2% year over year, while the Consulting and Digital segments were flat year over year but showed positive momentum at constant exchange rates.
For its fiscal second quarter, Korn Ferry expects adjusted earnings per share between $1.14 and $1.26, compared with analyst expectations of $1.20. The company expects second-quarter revenue of $655 million to $685 million, below the consensus estimate of $687.8 million.
The company repurchased 351,250 shares for $23.5 million during the quarter and declared a quarterly dividend of $0.37 per share, payable on October 15.
Korn Ferry’s operating margin increased 320 basis points year-over-year to 11.3%, while adjusted EBITDA margin increased 280 basis points to 16.5%.
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