Korn Ferry 2025 Q4 Earnings Strong Performance Despite Net Income Decline

Korn Ferry(KFY) reported its fiscal 2025 Q4 earnings on Jun 27th, 2025. Korn Ferry exceeded analyst expectations with adjusted EPS of $1.32 compared to the consensus estimate of $1.26. Additionally, the company outperformed Street forecasts with total sales of $719.83 million versus the expected $689.90 million. However, Korn Ferry's guidance for the first quarter of fiscal year 2026 fell in line with analyst predictions, projecting an adjusted EPS between $1.18 and $1.26, and fee revenue ranging from $675 million to $695 million.

Revenue
The total revenue of Korn Ferry increased by 2.8% to $719.83 million in 2025 Q4, up from $699.92 million in 2024 Q4.

Earnings/Net Income
Korn Ferry's EPS declined 0.4% to $1.25 in 2025 Q4 from $1.25 in 2024 Q4. Meanwhile, the company's net income declined to $65.14 million in 2025 Q4, down 0.7% from $65.61 million reported in 2024 Q4. The EPS reflects stable performance despite the slight net income decrease.

Post-Earnings Price Action Review
The strategy of buying KFY shares when revenues exceed expectations and holding for 30 days proved effective, yielding a substantial 138.14% return, significantly outperforming the benchmark. Despite experiencing a maximum drawdown of -41.37%, the strategy demonstrated a reasonable Sharpe ratio of 0.66, signifying robust risk-adjusted returns. Implementing a 30-day holding period helped mitigate volatility, which was reported at 31.29%. This strategic approach highlights the importance of timing and duration in managing market fluctuations, providing a balanced method to leverage positive earnings surprises while controlling for potential risks.

CEO Commentary
Gary D. Burnison, CEO of Korn Ferry, expressed confidence in the company’s performance amid evolving global economic and political challenges, attributing success to the firm's diversification strategy and disciplined cost management. He noted that the increase in fee revenue in Executive Search and Recruitment Process Outsourcing (RPO) has been a significant growth driver, despite a decline in Consulting fee revenue. Burnison emphasized ongoing investments in expanding offerings will continue to fuel future growth, aligning Korn Ferry's solutions with client needs and reinforcing its market position.

Guidance
Korn Ferry expects first-quarter adjusted EPS to range between $1.18 and $1.26, compared to the consensus estimate of $1.20. The company forecasts quarterly fee revenue between $675 million and $695 million, reflecting a stable outlook in a challenging market environment.

Additional News
Over the past few weeks, Korn Ferry has actively engaged in capital allocation strategies, including repurchasing 232,000 shares for $15 million and distributing $25 million in dividends, underscoring its commitment to returning value to shareholders. Furthermore, Korn Ferry was recognized for the eighth consecutive year as a leader in Everest Group’s RPO Services PEAK Matrix® Assessment 2025. These efforts reflect Korn Ferry's strategic focus on enhancing shareholder value and maintaining its leadership position in the industry. Additionally, the company announced a quarterly cash dividend, reinforcing its consistent payout policy to investors.