Korn Ferry Reports 2% Drop in Revenue but Improvement in Net Income

Korn Ferry has announced its third quarter fiscal 2024 results, revealing a 2% year-over-year decrease in fee revenue to $668.7 million. However, the company's net income attributable to Korn Ferry increased significantly to $59.1 million in Q3 FY'24 from $11.2 million in Q3 FY'23. Diluted earnings per share were reported at $1.13, and adjusted diluted earnings per share stood at $1.07 in Q3 FY'24.

The company's operating income experienced a substantial increase, reaching $49.9 million with an operating margin of 7.5%, marking a 570 basis points increase compared to the year-ago quarter. Adjusted EBITDA also saw growth, reaching $101.7 million with an adjusted EBITDA margin of 15.2%, a 110 basis points increase compared to the year-ago quarter.

Consulting and digital segments showed resilience, with consulting fee revenue growing by 3% year-over-year and digital fee revenue increasing by 6% year-over-year, driven by an 11% increase in subscription & license fee revenue, amounting to approximately $33.0 million in the quarter.

Korn Ferry repurchased 382,500 shares of stock during the quarter for $21.0 million and declared a quarterly dividend of $0.33 per share. The company's CEO, Gary D. Burnison, expressed satisfaction with the third quarter results, highlighting the resilience and potential of Korn Ferry.

Looking ahead, assuming steady worldwide geopolitical conditions, economic conditions, financial markets, and foreign exchange rates, Korn Ferry expects its Q4 FY’24 fee revenue to range between $675 million and $695 million, with diluted earnings per share expected to range between $1.06 and $1.14. On a consolidated adjusted basis, Q4 FY’24 adjusted diluted earnings per share are expected to be in the range of $1.09 to $1.17.

The market has reacted to these announcements by moving the company's shares 0.1% to a price of $64.12. Check out the company's full 8-K submission here.

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