Executive Summary
Korn Ferry reported a solid start to fiscal 2026 with consolidated fee revenue up 5% year-over-year to approximately $715.5 million and adjusted EBITDA of about $120.0 million, corresponding to an adjusted EBITDA margin of roughly 17%. GAAP net income was $66.6 million, with basic earnings per share (EPS) of $1.28 and diluted EPS of $1.26. The quarter underscores the company’s strategy of delivering larger, multi-solution engagements across a diversified global footprint, supported by a strong backlog (estimated remaining fees under existing contracts) of $1.67 billion, up 9% YoY, and a robust pipeline of new business (RPO at $99 million). Regional performance was mixed but constructive: Americas declined 2% YoY as consulting and interim demand softened, while EMEA (+19% YoY) and APAC (+12% YoY) posted solid growth across solutions. Management emphasized the accelerating transition toward large-scale, integrated platforms (Talent Suite) and AI-enabled capabilities as core catalysts for future growth, with a market launch targeted for November and a realization of benefits more evident toward the end of calendar 2026.
Key Performance Indicators
Key Insights
Revenue: $715.5M, up 5% YoY; Gross profit: $176.9M, gross margin 24.7%; Adjusted EBITDA: $120.0M, margin 17.0%; Operating income: $83.4M, margin 11.7%; Net income: $66.6M, net income margin 9.3%; GAAP EPS: $1.28, Diluted EPS: $1.26; Backlog (fees under existing contracts): $1.67B, up 9% YoY; RPO new business: $99M, 46% new logos, 54% renewals; Regional fee revenue: Americas -2% YoY; EMEA +19% YoY; APAC +12% YoY; Digital subscriptions: +10% YoY with 39% of digital new business; Marquee & Diam...
Financial Highlights
Revenue: $715.5M, up 5% YoY; Gross profit: $176.9M, gross margin 24.7%; Adjusted EBITDA: $120.0M, margin 17.0%; Operating income: $83.4M, margin 11.7%; Net income: $66.6M, net income margin 9.3%; GAAP EPS: $1.28, Diluted EPS: $1.26; Backlog (fees under existing contracts): $1.67B, up 9% YoY; RPO new business: $99M, 46% new logos, 54% renewals; Regional fee revenue: Americas -2% YoY; EMEA +19% YoY; APAC +12% YoY; Digital subscriptions: +10% YoY with 39% of digital new business; Marquee & Diamond revenue share: ~40% of total revenue, +7% YoY; Cross-solution referrals: 25% of revenue; Year-to-date guidance for Q2: Revenue $690–$710M; Adjusted EBITDA margin 17%–17.5%; Adjusted EPS $1.23–$1.33; GAAP EPS $1.10–$1.16.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
715.54M |
2.23% |
5.77% |
| Gross Profit |
176.94M |
19.39% |
2.17% |
| Operating Income |
83.45M |
-5.05% |
6.67% |
| Net Income |
66.64M |
2.22% |
14.08% |
| EPS |
1.28 |
1.59% |
14.29% |
Management Commentary
Key management themes from the Q1 earnings call: 1) Strategy validation and multi-solution growth: Diversification and integration of solutions are driving durable, recurring revenue and expanding client relationships; 'the opportunity is immense' under a diversified, multi-solution model. 2) Talent Suite launch as a strategic catalyst: November market launch with expected benefits materializing toward the end of calendar 2026; partnerships and training programs are central to scale. 3) AI and efficiency initiatives: Central AI team and Gen AI usage are being embedded to boost capacity and unlock backlog, with an emphasis on human-plus-AI workflows and the potential to reduce cycle times. 4) Backlog and backlog conversion: Backlog is growing, with a shift toward multi-year, multi-million dollar engagements; Talent Suite is positioned as an enabler to deliver these engagements more efficiently. 5) Regional dynamics: Americas softness in some segments balanced by strong EMEA and APAC growth; Exec Search in North America remains a bright spot due to demographic tailwinds and leadership transition demand.
“The opportunity is immense.”
— Gary Burnison
“Talent Suite will enable our consultants and clients to more easily derive and prioritize insights across our multiple Talent products using client data, our own proprietary data and select third-party data to help them make better and more insightful talent decisions.”
— Robert Rozek
Forward Guidance
Management projects Q2 2026 fee revenue of $690–$710 million with adjusted EBITDA margin of about 17–17.5% and adjusted diluted EPS of $1.23–$1.33 (GAAP EPS $1.10–$1.16). The company expects approximately $10 million ($0.14 per share) of accelerated depreciation related to the old product platform, with the Talent Suite sunset planned for the start of the Q3 launch in November. The long lead-time for Talent Suite benefits suggests material contributions will begin to surface toward the end of calendar 2026, not in the immediate quarter. Investment thesis centers on: (1) monetizing Talent Suite via subscriptions/licenses as well as as an enabler for core services; (2) cross-solution referrals and expansion into large, multi-year engagements; (3) AI and Gen AI integration to improve delivery efficiency and expand capacity; (4) continued geographic expansion, particularly outside the U.S. near-term risk: macroeconomic uncertainty, rate volatility, and potential timing of AI-driven productivity gains. Key monitors: Talent Suite adoption progress, partnerships with major HCM players, backlog conversion rate, cross-solution cross-sell intensity, and regional demand signals (Americas, EMEA, APAC).