Korn Ferry (NYSE:KFY) reported third-quarter results on Monday that came in above Wall Street expectations but issued a cautious outlook for the upcoming quarter.
Shares of the global consulting firm declined 4.73% in pre-market trading following the announcement, as investors reacted to the company’s guarded guidance.
For the third quarter, Korn Ferry posted adjusted earnings per share of $1.28, surpassing the analyst consensus estimate of $1.23 by $0.05.
Fee revenue totaled $717.4 million, representing a 7% year-over-year increase and significantly exceeding the consensus forecast of $692.44 million. Net income attributable to Korn Ferry rose 12% from the prior year to $65.3 million, while adjusted EBITDA increased 8% to $123.1 million, resulting in a margin of 17.2%.
Looking ahead to the fourth quarter, the company projected earnings between $1.34 and $1.40 per share. The midpoint of $1.37 aligns with analysts’ expectations of $1.37. Korn Ferry also expects revenue in the range of $730 million to $750 million, with a midpoint of $740 million slightly above the consensus estimate of $732.7 million.
“Our strong quarterly performance continues to reflect the evolution of our firm,” said Gary D. Burnison, CEO of Korn Ferry. “Today the world is enveloped by unprecedented levels of change – shifts in population, demographics and technological advancement that are converging to exert great impact on the way people live, work and consume.”
Growth in fee revenue was recorded across all solution areas, led by Executive Search with a 13% increase, followed by Professional Search & Interim and Consulting, each growing 5%.
The company also reported estimated remaining fees under existing contracts totaling $1.9 billion at the end of the quarter, marking an 11% increase compared with the same period last year.