Korn Ferry (KFY) Q3 2025 earnings summary

Executive summary

• Q3 FY'25 fee revenue was $668.7M, flat year-over-year (up 2% at constant currency), with net income attributable to Korn Ferry at $58.4M and adjusted EBITDA at $114.5M, up 13% year-over-year; adjusted diluted EPS was $1.19, up 11% year-over-year.

• RPO and Executive Search returned to growth, with RPO fee revenue up 4% and $210M in new business, 64% from new clients; Professional Search & Interim remained flat, aided by the Trilogy acquisition.

• New business increased 13% year-over-year in constant currency, with strong performance in large-scale transformation engagements and marquee accounts now representing 39% of the portfolio.

• Announced a 30% increase in quarterly dividend to $0.48, marking the sixth increase in five years and reflecting confidence in future earnings and cash flow.

• 237,000 shares were repurchased for $17.9M during the quarter, with $133M returned to shareholders year-to-date via repurchases and dividends.

Financial highlights

• Adjusted EBITDA was $114.5M (17.1% margin), up from $101.7M (15.2%) last year; adjusted diluted EPS was $1.19.

• Net income attributable to Korn Ferry was $58.4M, down 1% year-over-year; diluted EPS was $1.10.

• Compensation and benefits expense decreased 7% to $425.3M, while general and administrative expenses rose 4% to $65.3M due to real estate impairment charges.

• Cash and cash equivalents plus marketable securities totaled $1.06B at quarter end; working capital was $739.6M.

• Year-to-date fee revenue was $2.02B, down 2.6% from $2.07B last year.

Outlook and guidance

• Q4 FY'25 fee revenue expected between $680M and $700M; adjusted diluted EPS guidance of $1.22–$1.30; GAAP diluted EPS of $1.20–$1.28.

• Adjusted EBITDA margin projected at 16.8%–17%; margin targets remain at 16%–18%.

• Focus remains on expanding integrated, recurring revenue streams and leveraging digital and consulting synergies for more predictable earnings.

• Continued investment in marquee and regional accounts to drive sustainable growth and deeper client penetration.

• Management expects continued growth opportunities despite near-term economic uncertainty, with disciplined cost management.