Korn Ferry (KFY) 5 Sep 24 2025 Q1 Earnings call transcript

In Korn Ferry's latest earnings call, the company showcased a robust performance, with solid revenue and profitability growth, strategic initiatives, and a positive outlook for the future. The call, led by CEO Gary Burnison, revealed a company that is not only navigating the current economic challenges but also capitalizing on growth opportunities.

Strategic Growth and Financial Resilience

Korn Ferry's financial performance for the first quarter of Fiscal Year 2025 was a testament to its strategic focus and financial resilience. The company's adjusted EBITDA margin expanded for the fifth consecutive quarter, demonstrating its ability to manage costs effectively and maintain profitability. Fee revenue grew year-over-year, with Consulting and Digital solutions driving significant revenue, and Executive Search experiencing a return to growth.

The company's strategic focus on its marquee and regional accounts, innovation and IP, brand, M&A, and colleagues has been instrumental in its growth. The marquee and regional accounts, which account for 37% of the portfolio, are a key driver of revenue, with cross-referrals contributing to 27% of total revenue. The company's investment in its brand and intellectual property has positioned it as a trusted advisor in organizational consultancy, with a strong presence in the market.

Navigating the Challenges

Despite the challenging business environment, Korn Ferry remains optimistic about its future. The company's focus on innovation and strategic investments has helped it tap into a potentially $300 billion market opportunity. Its go-to-market approach, anchored on its marquee and regional accounts, has proven to be successful, with clients benefiting from the company's IP and full suite of offerings.

Investing in the Future

Korn Ferry's capital allocation strategy reflects its confidence in its future prospects. The company has continued to invest in its business, hiring approximately 50 fee earners across all lines of business and making significant investments in digital product upgrades and technology. These investments are aimed at driving growth and enhancing its competitive edge.

Looking Ahead

Looking ahead, Korn Ferry expects fee revenue in the second quarter to range from $655 million to $685 million, with an adjusted EBITDA margin approximating 16.3% to 16.7%. The company is also confident in its ability to maintain profitability while investing in its business to position itself for long-term growth.

Conclusion

Korn Ferry's earnings call painted a picture of a company that is not only weathering the current economic challenges but also capitalizing on growth opportunities. Its strategic focus on innovation, brand, and colleagues, coupled with its financial resilience, positions it well for the future. With a strong focus on its marquee and regional accounts, Korn Ferry is demonstrating its ability to drive deeper impact for its clients and tap into significant market opportunities. As the company looks ahead, its strategic investments and focus on innovation are expected to fuel its growth and sustain its competitive edge.