LOS ANGELES - Global organizational consulting firm Korn Ferry (NYSE:KFY) reported better-than-expected fiscal first quarter results on Thursday, but provided a mixed outlook for the current quarter.
Korn Ferry posted adjusted earnings per share of $1.18 for the quarter ended July 31, surpassing analyst estimates of $1.12. Revenue came in at $682.8 million, also beating the consensus forecast of $664.4 million.
However, fee revenue declined 3% YoY to $674.9 million, or 2% on a constant currency basis. The company attributed this decrease primarily to lower fee revenues in its Professional Search & Interim and RPO segments due to reduced demand in the current economic environment.
"I am pleased with our first quarter results, as we generated $675 million in fee revenue," said CEO Gary D. Burnison. He highlighted that earnings and profitability increased YoY, with Adjusted EBITDA of $111 million at a 16.5% margin, marking the fifth consecutive quarter of profitability improvement.
Executive Search fee revenue grew 2% YoY, while Consulting and Digital segments remained flat YoY but showed positive momentum on a constant currency basis.
For the fiscal second quarter, Korn Ferry expects adjusted EPS between $1.14 and $1.26, compared to analysts' expectations of $1.20. The company projects Q2 revenue in the range 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 YoY to 11.3%, while Adjusted EBITDA margin rose 280 basis points to 16.5%.
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