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CFO Nirupam Sinha stated the Q3 guidance is prudent, with the high end supported by continued demand and cross-selling, while the low end accounts for potential macro-driven project delays. He noted that while Q2 search productivity was high at $2.3M annualized, the trailing twelve-month figure is closer to the $2.0M target, which still signals strong demand. Sinha confirmed hiring is broad-based. CEO Tom Monahan added that unlike last year's single global conference, future team events will be spread more evenly throughout the year.

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Executive Nirupam Sinha addressed the consulting question, citing one-time Q1 charges and timing of bonus accruals, while reaffirming the long-term margin guidance of 11-13%. Executive Thomas Monahan described organic investments as focusing on two areas: acquiring top talent and enhancing their success with digital tools and IP. Monahan also noted that while client needs vary, key long-term themes driving demand include supply chain resilience, adapting to higher interest rates, and the expanding strategic role of the Chief People Officer.

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CFO Nirupam Sinha explained that the expected margin expansion in 2025 will primarily come from the non-search businesses as they gain leverage from shared corporate costs. Regarding Heidrick Consulting, he clarified that the Q4 variable compensation increase was partly a catch-up for strong full-year performance and is not expected to be a recurring material issue. He also confirmed that no significant currency impact was factored into the Q1 2025 outlook.

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CEO Thomas Monahan explained that the focus on organic growth is to fully leverage and scale powerful capabilities acquired in recent years, though selective M&A remains an option. For On-Demand Talent, Monahan cited a differentiated strategy in critical roles, while VP & Controller Steve Bondi noted Europe saw more confirmations and the U.S. saw higher contract values. Regarding G&A, Bondi confirmed it is a source of future leverage but declined to provide a specific 2025 target, linking leverage to successful organic growth.

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President & CEO Thomas Tedford affirmed that ACCO has a good range of price points for North America but is actively repositioning products in Brazil to compete with lower-cost Chinese imports. He noted it's hard to predict the sustainability of this competition. EVP & CFO Deborah A. O'Connor added that gross margin is expected to modestly improve in the second half as pricing actions are designed to cover tariff costs and maintain margins. She also confirmed a favorable FX benefit is expected, particularly in Q4.

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CFO Deb O'Connor attributed the favorable mix to a large Kensington sale and an early pull-forward of profitable back-to-school products. President and CEO Tom Tedford explained the higher gross margin target reflects ongoing cost structure optimization. He also confirmed that U.S.-bound sourcing from China will be 'insignificant' by year-end. O'Connor reaffirmed the full-year cost savings target of $40 million.

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EVP and CFO Deb O'Connor clarified that the comparable sales outlook excludes FX, noting an expected 4% headwind in Q1 tapering to 2% for the full year. President and CEO Tom Tedford addressed tariffs by highlighting ACCO's balanced global supply chain, which is not overly dependent on China. He mentioned that the company is passing on costs via price increases and actively managing its supply sources. Regarding M&A, Tedford described the pipeline as solid but emphasized a disciplined, balanced approach focused on synergistic, strategically relevant deals that would not adversely impact leverage.

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President and CEO Tom Tedford identified computer accessories (Kensington), business machines, and ergonomics as categories showing positive stabilization. He discussed a major product development review, assisted by a third party, aimed at improving revenue outcomes across the portfolio. He highlighted recent launches like the Kensington EQ line and confirmed he expects continued growth from the computer accessories business.

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CEO Mark Hussey detailed Huron's comprehensive performance improvement offerings, including revenue cycle, supply chain, and clinical operations, which help clients find both cost savings and growth opportunities. Regarding the Trelliant acquisition, Hussey explained that it is highly complementary to Huron's existing financial services practice, adding specialized expertise in risk, compliance, and financial crimes that is aligned with but not overlapping current capabilities, creating a more comprehensive solution.

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CFO John D. Kelly expressed confidence in the Commercial segment's 20%+ guided growth for 2025, driven by the AXIA acquisition and organic growth in digital and financial advisory, supported by a strong backlog. He confirmed that delayed Education projects are now at a run rate. CEO C. Hussey detailed plans to broaden the Healthcare offering by expanding financial advisory services, growing managed services, and pushing further into digital and payer-related services, leveraging deep client relationships.

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Chief Financial Officer John Kelly quantified the project shift from Q3 to Q4 as being in the '$5 million to $10 million range' and confirmed that the majority of these delays occurred in the Education segment. Executive C. Hussey characterized Q3 as an 'inflection point' for the Commercial segment, with a rebuilding pipeline. He expressed optimism for 2025, stating that 'the signs are pointing green and up' as clients appear to be moving forward with investments.

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CEO John Wasson explained that contract cancellations have flattened and there has been a pickup in contract modifications, led by the IT modernization area but also seen across complex program management. He expressed confidence that the federal technology business will return to growth in 2026. Regarding guidance, Wasson stated that while they are confident the revenue decline will not be as severe as 10%, it is too early to provide a specific number due to ongoing budget uncertainties. However, he noted that EPS is likely to be at the higher end of the guidance range due to strong commercial energy growth and cost management.

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Executive John Wasson confirmed that while the administration is expected to continue investing in IT modernization and AI, new opportunities are likely a second-half 2025 event that would primarily set up for potential growth in 2026. He reiterated that the 2025 forecast remains a 5% to 10% decline for the business, driven by the slow pace of new awards.

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Executive John Wasson noted that the renewable energy business is driven by strong economics and that the most at-risk portion, offshore wind, is not material to ICF's revenue. He described 2025 as a transition year due to a temporary slowdown in IT procurements as the new administration resets its strategy, but he anticipates new opportunities in 2026. Executive Barry Broadus confirmed that ICF will continue to repurchase shares opportunistically, citing the company's balance sheet capacity.

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Paul Maleh, Chairman, President & CEO, praised the Energy practice's remarkable organic growth, led by its internal leadership, and confirmed that while they are actively looking for inorganic opportunities, any acquisition must be a strong strategic fit. Regarding the new executive roles, Maleh explained the promotions aim to elevate the strategic value provided by the corporate team to the consulting practices. He characterized the incoming analyst class as a typical size, clarifying that while aggregate headcount is flat, the company is actively investing in and expanding headcount within its high-growth practices.

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CEO Paul Maleh declined to provide specific details on the restructuring to respect the individuals and avoid misrepresenting the health of the affected practices, noting the disclosure was for financial clarity. He praised the Antitrust & Competition Economics practice for its consistent record-setting performance, driven by both merger-related work and antitrust investigations. Maleh confirmed that cross-practice and cross-geography collaboration is a frequent and 'underreported' part of CRA's strategy, focused on bringing the best talent to bear on client problems.

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Executive Paul Maleh stated that the strong 2025 guidance builds on a record 2024 and anticipates broad-based growth, with a goal for practices like Life Sciences and Energy to increase their growth rates. He noted the margin guidance reflects confidence in maintaining recent profitability gains. Maleh sees potential for utilization to rise above the mid-70s but acknowledged that faster growth in management consulting could temper this. He described a competitive but opportunity-rich market for senior talent, where CRA aims to be a net gainer from industry disruption.

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CEO Paul Maleh responded that voluntary attrition rates remain on the low side and the company is planning accordingly, having not yet seen a return to higher historical levels. Regarding the U.S. election, Maleh expressed confidence, stating that the firm has operated successfully under different administrations and is well-positioned to adapt its strong service portfolio to meet evolving client needs, irrespective of the outcome.

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Chairman & CEO J. Bryan King explained that TestEquity has a clear path to double-digit EBITDA margins by optimizing its high-value specialty offerings. For Lawson, he reiterated a long-term goal of mid-to-high teens or even 20%+ EBITDA margins post-investment cycle. EVP & CFO Ron Knutson added that excluding the military headwind, Lawson's organic ADS grew 0.5% in the quarter. King also highlighted that Lawson's core 'street business' has begun to show positive growth for the first time in years.

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Executive John King stated that while the current environment will create more M&A opportunities, DSG is taking a measured approach, preferring to let market complexity from Washington settle. He noted the M&A pipeline is robust but that share buybacks are currently the most attractive use of capital. On reshoring, King confirmed a firm belief in the long-term benefits, stating that DSG's sourcing expertise becomes more valuable in murky times and that the company has been positioning itself for this shift for years.

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Executive John King confirmed that Q4 organic growth was firmer than anticipated, driven by momentum in the Gexpro Services and Test and Measurement verticals. Regarding Lawson, King detailed the significant investments in the sales force and noted that reducing historical rep turnover is a key to long-term margin improvement, expecting good progress in 2025 but a multi-year journey. He described the military order situation as an 'enigma' with uncertain timing. For Source Atlantic, he explained that margin improvement hinges on cost structure optimization and facility consolidation, which should be completed by mid-year, though seasonality will affect near-term results. Executive Ronald Knutson added color on Lawson's improving rep productivity and the conservative forecasting approach for the military business.

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Executive Ronald Knutson explained that most of the new territories are greenfield opportunities identified through data analysis, and that hiring rates increased by approximately 50% in Q3. Executive John King added that new territories are scoped for higher revenue to improve new rep success, and acknowledged that the company was previously too slow to hire while implementing new sales tools.

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J. Joel Quadracci, President, CEO, Chairman & Director, expressed cautious optimism regarding postal rates, citing a new USPS catalog discount test and a regulatory review suggesting a return to CPI-capped increases. He explained that Audience Builder 2.0 democratizes access to Quad's data stack, using AI to automate and accelerate the creation of high-propensity audiences for clients. Quadracci pointed to strong year-to-date sales growth in targeted print areas like direct mail and in-store as concrete evidence of the company's strategic progress toward its long-term growth inflection point.

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J. Joel Quadracci, Chairman, President and CEO, explained that while some clients have made minor marketing adjustments due to tariff-related product uncertainty, a major pullback has not yet occurred. He noted that a new USPS promotion for catalogers starting in October could offset the July rate hike. Quadracci also detailed that the Enru acquisition adds high-density co-mailing capabilities, benefiting the entire industry. He confirmed In-Store Connect has expanded to over 45 stores, with new grocer wins. CFO Anthony Staniak added that the expansion of the Save Mart partnership is a positive development.

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CFO Tony Staniak detailed increased capital expenditures for technology like AI and In-Store Connect, alongside higher operating expenses to scale new offerings. CEO J. Joel Quadracci and CFO Tony Staniak explained that growth in Agency Solutions, International Print, and Targeted Print is expected to improve the revenue trend. Quadracci elaborated on the monetization of At-Home Connect as an integrated service driving direct mail volume, addressed tariff risks by noting pre-purchased paper inventory, and highlighted ongoing cost management through AI, labor flexibility, and process automation.

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J. Joel Quadracci, Chairman, President & CEO, explained that the Google partnership leverages Quad's proprietary data stack with AI to create personalized content at scale, which he sees as a significant differentiator with strong early client interest. He noted the lower leverage target is due to both the European divestiture and the Saratoga Springs asset sale. CFO Anthony Staniak added that the European sale's timing means it won't materially impact 2024 sales guidance and confirmed the company remains bullish on its Americas operations, highlighting a strong quarter in Mexico.

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