Korn Ferry reported second‑quarter fiscal 2026 results that surpassed consensus estimates, with fee revenue reaching $721.7 million, a 7% year‑over‑year increase, and adjusted diluted earnings per share of $1.33, beating the $1.31 consensus by $0.02 (1.5%). The company’s diluted EPS rose 19% to $1.36 from $1.14 a year earlier, driven by a mix shift toward higher‑margin consulting and executive‑search work and disciplined cost management that kept operating leverage strong.
Revenue growth was led by the Executive Search and Professional Search & Interim segments, which grew 10% and 17% respectively, reflecting robust demand for talent‑acquisition services in a tight labor market. The Digital segment, while down 2% overall, saw its subscription and license fee revenue climb 5%, underscoring the company’s progress toward a recurring‑revenue model. Adjusted EBITDA margin held steady at 17.3%, flat year‑over‑year, indicating that margin compression from the Digital decline was offset by higher‑margin consulting and search work.
Korn Ferry’s consulting backlog increased 20% to $1.842 billion, a sign of strong future revenue visibility, though the company did not confirm it as an all‑time high. The firm’s guidance for the third quarter projects fee revenue of $680–$694 million and adjusted diluted EPS of $1.19–$1.25, slightly below analyst expectations of $687 million and $1.24, respectively. Management cited a cautious outlook on macro‑economic conditions and competitive pricing pressures as reasons for the conservative guidance.
CEO Gary D. Burnison highlighted the company’s “integrated solutions approach” as a key driver of higher bill rates and client stickiness, noting that “in a world defined by disruption, digitization and economic fluctuation, organizations require more than static strategies.” He added that the firm remains confident in its ability to maintain profitability through disciplined cost control and continued investment in high‑return digital capabilities.
The market reaction was tempered by the Q3 guidance, with investors weighing the strong Q2 beat against the modestly lower outlook. The guidance signals management’s confidence in sustaining revenue growth while acknowledging potential headwinds, a balance that will shape investor expectations for the remainder of the fiscal year.
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