Q1 FY'27
Filed Sep 9, 2026Korn Ferry reports Q1 FY'27 fee revenue of $756.5 million, an increase of 7% year-over-year at both actual and constant currency.
Fee revenue grew 7% year-over-year, estimated remaining fees rose 14% year-over-year, and adjusted diluted earnings per share increased 9% year-over-year. Growth was broad across regions and was led by Search and Workforce Solutions, while net income margin declined and APAC adjusted EBITDA declined.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Fee revenueGAAP | $ 756.5 million | – | 7% |
| Total revenueGAAP | $ 764,622 (in thousands) | – | 6.9 % |
| Reimbursed out-of-pocket engagement expensesGAAP | $ 8,126 (in thousands) | – | 17.3 % |
| Estimated remaining fees under existing contractsother | $ 1,915.0 million | – | 14% |
| New businessother | $ 832.3 million | – | – |
| Fee earner new business productivityother | $ 1,840 (in thousands) | – | – |
| Ending number of fee earnersother | 1,811 | – | – |
| Compensation and benefitsGAAP | 477,362 (in thousands) | – | – |
| General and administrative expensesGAAP | 80,231 (in thousands) | – | – |
| Cost of servicesGAAP | 83,328 (in thousands) | – | – |
| Depreciation and amortizationGAAP | 22,195 (in thousands) | – | – |
| Total operating expensesGAAP | 671,242 (in thousands) | – | – |
| Operating incomeGAAP | 93,380 (in thousands) | – | – |
| Income before provision for income taxesGAAP | 94,145 (in thousands) | – | – |
| Income tax provisionGAAP | 24,648 (in thousands) | – | – |
| Net incomeGAAP | 69,497 (in thousands) | – | – |
| Net income attributable to Korn FerryGAAP | $ 69.0 million | – | 4% |
| Net income attributable to Korn Ferry marginGAAP | 9.1% | – | – |
| Basic earnings per shareGAAP | $ 1.35 | – | – |
| Diluted earnings per shareGAAP | $ 1.32 | – | 5% |
| Adjusted EBITDAnon-GAAP | $ 128.2 million | – | 7% |
| Adjusted EBITDA marginnon-GAAP | 17.0 % | – | flat year-over-year |
| Adjusted net income attributable to Korn Ferrynon-GAAP | $ 74.6 million | – | – |
| Adjusted basic earnings per sharenon-GAAP | $ 1.46 | – | – |
| Adjusted diluted earnings per sharenon-GAAP | $ 1.43 | – | 9% |
| Integration/acquisition costsnon-GAAP | $ 7.6 million | – | – |
| Cash and cash equivalentsGAAP | $ 800,852 (in thousands) | – | – |
| Marketable securitiesGAAP | 15,439 (in thousands) | – | – |
| Marketable securities, non-currentGAAP | 234,778 (in thousands) | – | – |
| Long-term debtGAAP | 398,778 (in thousands) | – | – |
| Total assetsGAAP | $ 3,816,876 (in thousands) | – | – |
| Total liabilitiesGAAP | 1,815,599 (in thousands) | – | – |
| Total stockholders' equityGAAP | 2,001,277 (in thousands) | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| AmericasThe fee revenue increase was primarily driven by increases of 14% in both Search and Workforce Solutions. | $ 442.1 million | – | 9% |
| EMEAFee revenue increased in all Solution groups, led by Workforce Solutions and Talent & Organizational Solutions up 8% and 4%, respectively. | $ 227.7 million | – | 4% |
| APACFee revenue increased primarily driven by a 7% increase in Search, offset by a decline in the other Solution Groups. | $ 86.7 million | – | 1% |
| SearchSearch fee revenue increased across Americas, EMEA and APAC. | $ 307,898 (in thousands) | – | 10.4 % |
| Talent & Organizational SolutionsGrowth in EMEA was offset by declines in Americas and APAC. | $ 259,220 (in thousands) | – | — % |
| Workforce SolutionsWorkforce Solutions fee revenue increased in Americas and EMEA and declined in APAC. | $ 189,378 (in thousands) | – | 11.1 % |
Q2 FY’27 outlook
- Revenue$860 million and $878 million
- NoteAdjusted EBITDA margin is expected to range from 16.8% to 17.2%.
- NoteAdjusted diluted earnings per share is expected to be in the range from $1.30 to $1.40.
- NoteAdjusted diluted earnings per share includes the net after tax impact of two months of incremental intangible asset amortization, incremental net interest expense and incremental shares issued in connection with the acquisition of AMS which closed on September 1, 2026.
What drove it
- Fee revenue grew in all regions year-over-year, led by double digit growth in Search and Workforce Solutions of 10% and 11%, respectively.
- Net income attributable to Korn Ferry and Adjusted EBITDA increased primarily due to an increase in fee revenue, partially offset by increases in compensation and benefits expenses and general and administrative expenses.
- Americas adjusted EBITDA increased primarily due to an increase in fee revenue, partially offset by increases in compensation and benefits expenses and cost of services.
- AMS became part of Korn Ferry on September 1, 2026 and is included in the Q2 FY'27 outlook for September and October.
Concerns
- Net income attributable to Korn Ferry margin was 9.1% compared to 9.4% in Q1 FY'26.
- APAC fee revenue increased 1% year-over-year, or 2% at constant currency, and adjusted EBITDA was $19.2 million compared to $19.8 million in the year-ago quarter.
- Corporate adjusted EBITDA was $(44,682) (in thousands) compared to $(35,849) (in thousands) in the prior-year quarter.
- Q2 FY'27 outlook assumes no further changes in worldwide geopolitical conditions, economic conditions, financial markets and foreign exchange rates.
What to watch
- Execution of the AMS acquisition, including integration/acquisition costs and the expected benefits of the combination.
- Whether Q2 FY'27 fee revenue falls within the expected range of $860 million and $878 million.
- Whether Q2 FY'27 adjusted EBITDA margin falls within the expected range from 16.8% to 17.2%.
- Whether APAC can improve from its 1% year-over-year fee revenue growth and adjusted EBITDA decline.
Balance sheet and cash flow
- Cash and cash equivalents were $ 800,852 (in thousands) at July 31, 2026, compared to $ 1,095,445 (in thousands) at April 30, 2026.
- Marketable securities were 15,439 (in thousands) and marketable securities, non-current were 234,778 (in thousands) at July 31, 2026.
- Long-term debt was 398,778 (in thousands) at July 31, 2026.
- Total assets were $ 3,816,876 (in thousands), total liabilities were 1,815,599 (in thousands), and total stockholders' equity was 2,001,277 (in thousands) at July 31, 2026.
Analysis
Korn Ferry delivered its sixth consecutive quarter of top-line growth, reporting Q1 FY'27 fee revenue of $756.5 million, up 7% year-over-year at both actual and constant currency. Total revenue was $ 764,622 (in thousands), up 6.9 %, while estimated remaining fees under existing contracts reached $ 1,915.0 million, up 14% year-over-year. New business was $ 832.3 million and fee earner new business productivity was $ 1,840 (in thousands). The ending number of fee earners was 1,811, compared with 1,830 in Q1 FY'26.
Growth was broad geographically. Americas fee revenue was $442.1 million, up 9%, driven by increases of 14% in both Search and Workforce Solutions. EMEA fee revenue was $227.7 million, up 4%, with Workforce Solutions and Talent & Organizational Solutions up 8% and 4%, respectively. APAC fee revenue was $86.7 million, up 1%, as a 7% increase in Search was offset by declines in the other Solution Groups. By solution group, Search fee revenue increased 10.4 % to $ 307,898 (in thousands), Workforce Solutions increased 11.1 % to $ 189,378 (in thousands), and Talent & Organizational Solutions was $ 259,220 (in thousands) with — % change.
Profit growth trailed revenue growth on a GAAP basis. Net income attributable to Korn Ferry rose 4% to $69.0 million, but its margin declined to 9.1% from 9.4%. Diluted earnings per share was $1.32, up 5%. Adjusted EBITDA increased 7% to $128.2 million and its margin was flat year-over-year at 17.0 %. Adjusted diluted earnings per share increased 9% to $1.43. The company attributed the increases in net income attributable to Korn Ferry and Adjusted EBITDA primarily to higher fee revenue, partly offset by higher compensation and benefits expenses and general and administrative expenses.
Regional profitability was strongest in the Americas, where adjusted EBITDA was $116.4 million and adjusted EBITDA margin increased by 140 bps to 26.3%. EMEA adjusted EBITDA increased to $37.3 million and margin was 16.4 % compared with 16.3 %. APAC adjusted EBITDA declined to $19.2 million from $19.8 million, with margin declining to 22.2 % from 23.1 %. Corporate adjusted EBITDA was $(44,682) (in thousands), compared with $(35,849) (in thousands), while integration/acquisition costs were $7.6 million compared with $1.5 million.
For Q2 FY'27, Korn Ferry expects fee revenue between $860 million and $878 million, adjusted EBITDA margin from 16.8% to 17.2%, and adjusted diluted earnings per share from $1.30 to $1.40. The outlook includes AMS for September and October following the September 1, 2026 closing of the acquisition. Adjusted diluted earnings per share includes the net after tax impact of two months of incremental intangible asset amortization, incremental net interest expense and incremental shares issued in connection with the AMS acquisition. The company did not provide GAAP net income attributable to Korn Ferry margin or diluted earnings per share guidance because it could not estimate integration and acquisition costs during the second quarter of fiscal 2027 with reasonable certainty.
Management, verbatim
I am very pleased with our quarterly performance. This marks our sixth consecutive quarter of top-line growth, demonstrating the momentum and durability of our business, as well as the sustaining value we are creating for our clients.
Gary D. Burnison, CEO, Korn Ferry
AMS brings profound operational capability, delivering technology-enabled talent solutions at scale, supported by long-term contracted client relationships.
Gary D. Burnison, CEO, Korn Ferry
Not in the filing
stated, not guessed- Prior-quarter operating results and quarter-over-quarter comparisons.
- Gross profit and gross margin.
- Operating cash flow.
- Free cash flow.
- Capital expenditures.
- Share repurchases.
- Dividends.
- Forward GAAP net income attributable to Korn Ferry margin guidance.
- Forward GAAP diluted earnings per share guidance.
- Forward operating expenses guidance.
- Forward tax rate guidance.
- Prior-period guidance for comparison.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.