Heidrick & Struggles International (HSII) Q1 2025 earnings summary

Executive summary

• Q1 2025 net revenue grew 6.9% year-over-year to $283.6M, surpassing the high end of guidance, with all business segments and regions contributing to growth.

• Adjusted EBITDA reached $29.1M (10.3% margin), up 12.6% year-over-year, and adjusted net income was $14.2M with adjusted EPS of $0.67.

• Net income was $13.3M, down from $14.0M in Q1 2024, reflecting higher operating expenses.

• New CEO, President, and CFO appointed in early 2024 and January 2025.

• Board declared a $0.15 per share cash dividend for Q1 2025.

Financial highlights

• Total revenue reached $287.4M, up 6.8% year-over-year; constant currency net revenue was $286.8M.

• Adjusted EBITDA margin improved to 10.3% from 9.8% year-over-year.

• Net income for Q1 2025 was $13.3M; adjusted net income was $14.2M, with adjusted diluted EPS of $0.67.

• Salaries and benefits expense increased 8.6% to $189.5M, representing 66.8% of net revenue.

• Cash, cash equivalents, and marketable securities totaled $324.7M at quarter-end.

Outlook and guidance

• Q2 2025 revenue expected between $285M and $305M, compared to $278.6M in Q2 2024.

• Medium-term targets: organic revenue growth of 4-6% and adjusted EBITDA growth of 5-8% per year.

• Guidance reflects assumptions on project volume, consultant productivity, retention, and backlog, with sensitivity to FX, interest rates, inflation, and geopolitical risks.