KORN FERRY (KFY) Q1 2026 Earnings Summary

Executive Summary

Q1 FY’26 fee revenue rose 5% to $708.6M, with growth across all Solutions; adjusted diluted EPS was $1.31 (+11% YoY), and adjusted EBITDA margin expanded 50 bps to 17.0% .
Results beat Wall Street: revenue beat by ~$19.4M and EPS beat by ~$0.07 versus S&P Global consensus for Q1 FY’26; Q4 FY’25 and Q3 FY’25 were also beats on both revenue and EPS (see Estimates Context) [Values retrieved from S&P Global].
Management guided Q2 FY’26 fee revenue to $690–$710M and adjusted diluted EPS to $1.23–$1.33; GAAP diluted EPS $1.10–$1.16 includes ~$0.14 per-share accelerated depreciation as Digital is sunset ahead of November Talent Suite launch .
Catalysts: execution on large, multi-solution engagements, Talent Suite launch and AI enablement, and continued strength in Executive Search across EMEA/APAC; guidance tone is conservative given macro uncertainties and tariff backdrop .

What Went Well and What Went Wrong

What Went Well

Broad-based growth: Fee revenue up 5% YoY to $708.6M; Executive Search +8%, Professional Search & Interim +10%, RPO +3%, Digital +1% .
Margin expansion and EPS growth: Adjusted EBITDA margin +50 bps to 17.0%; adjusted diluted EPS rose 11% YoY to $1.31, supported by pricing and productivity .
Strong regional performance: EMEA fee revenue +17%, APAC +20% within Executive Search; total company new business led by EMEA/APAC strength per CFO commentary .

“Today we are driving performance with a far more sophisticated, holistic approach… the opportunity for Korn Ferry is immense.” — CEO Gary D. Burnison .
“We remain on track for the market launch of our new Talent Suite platform this November.” — CFO Robert Rozek .

What Went Wrong

Americas softness: Fee revenue in the Americas down ~2% YoY across several Solutions amid macro caution; management struck a conservative tone on guidance .
Consulting mixed: Consulting fee revenue +1% YoY but margin -50 bps to 17.0% due to slower client consumption of backlog despite higher bill rates (+9%) .
GAAP EPS headwind: Q2 guidance includes ~$0.14 per-share accelerated depreciation as Digital platform sunsets ahead of Talent Suite, lowering GAAP EPS guidance versus adjusted .

Financial Results

Consolidated performance vs prior quarters and estimates

Metric	Q3 FY’25	Q4 FY’25	Q1 FY’26
Fee Revenue ($USD Millions)	$668.7	$712.0	$708.6
Diluted EPS (GAAP) ($)	$1.10	$1.21	$1.26
Adjusted Diluted EPS ($)	$1.19	$1.32	$1.31
Net Income Margin (%)	8.7%	9.0%	9.4%
Adjusted EBITDA Margin (%)	17.1%	17.0%	17.0%

Estimates comparison (S&P Global)

Metric	Q3 FY’25 Estimate	Q3 FY’25 Actual	Q4 FY’25 Estimate	Q4 FY’25 Actual	Q1 FY’26 Estimate	Q1 FY’26 Actual
Revenue ($USD Millions)	$650.45*	$668.73	$689.89*	$712.05	$689.23*	$708.61
Primary EPS ($)	$1.129*	$1.19	$1.260*	$1.32	$1.236*	$1.31

Beats: Q1 FY’26 revenue and EPS beat; Q4 FY’25 and Q3 FY’25 also beat both revenue and EPS.
*Values retrieved from S&P Global.

Segment breakdown (Q1 FY’26 vs Q1 FY’25)

Solution	Fee Revenue Q1 FY’25 ($MM)	Fee Revenue Q1 FY’26 ($MM)	YoY %	Adj. EBITDA Margin Q1 FY’25	Adj. EBITDA Margin Q1 FY’26
Consulting	$167.9	$170.0	+1%	17.5%	17.0%
Digital	$88.2	$89.2	+1%	30.2%	31.0%
Executive Search (Total)	$208.6	$224.3	+8%	23.7%	25.6%
Professional Search & Interim	$121.7	$133.9	+10%	21.1%	20.9%
RPO	$88.5	$91.3	+3%	14.1%	15.7%

KPIs and operating metrics (Q1 FY’26)

KPI	Q1 FY’25	Q1 FY’26
Estimated remaining fees under existing contracts (Company) ($MM)	$1,532.6	$1,674.1
Consulting hours worked (‘000)	395	367
Consulting avg bill rate ($/hr)	$425	$463
Digital subscription & license fee revenue ($MM)	$34.1	$37.2
Executive Search engagements billed	3,448	3,751
Executive Search new engagements	1,556	1,596
PS&I Interim avg bill rate ($/hr)	$133	$138
PS&I avg weekly billable consultants	1,068	1,219
RPO new business ($MM)	$103.6	$99.3
Shares repurchased (units/$MM)	—	145,770 / $9.9

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Fee Revenue ($MM)	Q1 FY’26	$675–$695	—	—
Fee Revenue ($MM)	Q2 FY’26	—	$690–$710	Raised vs prior quarter midpoint (from $685 to $700)
Diluted EPS (GAAP) ($)	Q1 FY’26	$1.16–$1.24	—	—
Diluted EPS (GAAP) ($)	Q2 FY’26	—	$1.10–$1.16	Lowered vs prior quarter midpoint due to accelerated depreciation
Adjusted Diluted EPS ($)	Q1 FY’26	$1.18–$1.26	—	—
Adjusted Diluted EPS ($)	Q2 FY’26	—	$1.23–$1.33	Raised vs prior quarter midpoint (from $1.22 to $1.28)
EPS adjustments ($/share)	Q2 FY’26	—	+$0.19–$0.23 (integration/acquisition + accelerated depreciation)	New
Tax rate impact ($/share)	Q1 vs Q2	(0.01)	(0.06)	More negative

Context: Management highlighted conservatism in Q2 guidance given macro/tariff uncertainty, with GAAP EPS lowered by accelerated depreciation tied to Digital platform sunset ahead of Talent Suite launch .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 FY’25)	Previous Mentions (Q4 FY’25)	Current Period (Q1 FY’26)	Trend
AI/Technology initiatives (Talent Suite)	Digital stable, subscription mix improving	Continued investment in tech platforms; Digital margin ~31%	Talent Suite on track for November; AI/GenAI enablement across workflows; centralized AI team (~40 people)	Improving/accelerating
Macro/tariffs/interest rates	Labor supply/demand imbalance; cautious consulting demand	Consulting down 7% YoY in Q4; macro backdrop cautious	Uncertainty persists (tariffs, inflation, rates “higher for longer”); conservative guidance	Unchanged/uncertain
Regional trends	Exec Search up modestly; EMEA/APAC mixed	EMEA/APAC Exec Search strong double-digit growth	EMEA +19% and APAC +12% total company new business; strength across Solutions	Improving
Consulting backlog consumption	Larger multi-year engagements slow conversion	Similar dynamic; hours down; bill rate up	Backlog up; slower client consumption persists despite 9% bill rate increase	Mixed
Executive Search demographics	Pent-up demand supports activity	Strong growth (+14% YoY Q4)	Drivers include Peak-65 retirements and C-suite transitions; boards reassessing skills	Improving
PS&I/Interim strategy	Trilogy adds interim revenue; perm demand slower	Interim strength; perm softness; acquisitions ongoing	Interim growth (+14%); focus on interim acquisitions over contingent Pro Search	Improving (Interim)
RPO	New business $210M in Q3; stand-ups driving growth	New business $118.8M Q4; margin up	New business $99.3M in Q1; estimated remaining fees $728.8M	Stable

Management Commentary

Strategy and diversification: “We’re driving performance with a… holistic approach… in every major region… the opportunity for Korn Ferry is immense.” — CEO Gary D. Burnison .
Integrated solutions: “We Are Korn Ferry go-to-market… selling larger, more integrated solutions… paving the way for stronger, more durable long-term growth.” — CFO Bob Rozek .
Talent Suite launch: “On track for the market launch… this November… enables clients to make better hiring decisions… assess, develop, and reward their talent… at scale.” — CEO/CFO .
Capital allocation: “Returned $36M via repurchases and dividends; invested $22M in capex focused on Talent Suite and product enhancements.” — CFO .
Regional color: “EMEA fee revenue was strong, growing 19% YoY; APAC grew 12% YoY… growth in all solutions.” — CFO .

Q&A Highlights

Talent Suite milestones and timing: Benefits expected to build into late CY2026; training 1,800 frontline consultants; partnerships with major HCMs to drive scale .
Guidance conservatism: Q2 midpoint sequentially modest; management intentionally conservative given macro/tariff backdrop .
Digital/AI enablement: Subscription mix targeted >60% long-term; AI/GenAI as efficiency tools and agents integrated into workflows to free capacity (not just reduce headcount) .
Americas vs EMEA/APAC: Americas softer across several Solutions; Exec Search resilient; EMEA/APAC broad-based strength .
Exec Search drivers: Demographics (Peak-65), post-COVID C-suite reshaping, boards reevaluating skill profiles for next five years .
M&A posture: Prefer Interim acquisitions over Pro Search contingent models; global expansion opportunity (underpenetrated outside U.S.) .

Estimates Context

Q1 FY’26: Actual revenue $708.61M vs consensus $689.23M*; actual primary EPS $1.31 vs consensus $1.236* — bold beat on both.
Q4 FY’25: Actual revenue $712.05M vs consensus $689.89M*; actual primary EPS $1.32 vs consensus $1.260* — bold beat.
Q3 FY’25: Actual revenue $668.73M vs consensus $650.45M*; actual primary EPS $1.19 vs consensus $1.129* — bold beat.

Implications: With three consecutive quarterly beats on revenue and EPS, consensus may need to adjust upward for Subscription/Digital margin durability and Exec Search volume/mix, while GAAP EPS for Q2 incorporates Digital sunset depreciation.
*Values retrieved from S&P Global.

Key Takeaways for Investors

Broad-based growth with margin expansion: Q1 fee revenue +5% YoY to $708.6M and adjusted EBITDA margin +50 bps to 17.0%; signals resilience across diversified Solutions .
Durable Exec Search momentum: Engagements billed rose to 3,751 (+9% YoY) with EMEA/APAC strength; margin expanded to 25.6% .
Digital scaling with Talent Suite: Subscription & license revenue up to $37.2M; Talent Suite launch in November should support cross-solution delivery and analytics/AI leverage .
Americas caution vs EMEA/APAC strength: Expect conservative near-term guide but continued regional diversification benefits .
Near-term trading: Q2 GAAP EPS guide includes ~$0.14 per-share accelerated depreciation; focus on adjusted EPS range ($1.23–$1.33) and fee revenue range ($690–$710M) for underlying performance .
Medium-term thesis: Integrated multi-year engagements and AI-enabled delivery should lift pricing/productivity; backlog and estimated remaining fees ($1.67B) provide visibility .
Capital returns continue: Ongoing dividends ($0.48 declared for Oct. 15, 2025) and buybacks ($9.9M Q1 repurchases) support shareholder yield and confidence .