What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-06-26 compared with 2025-06-27 · 206 added, 202 removed, 299 unchanged (58% of the section changed)

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Similarly, statements that describe our objectives, plans or goals, including the timing and anticipated impacts of our business strategy, expected demand for and relevance of our products and services, and expected results of our business diversification strategy, are also forward-looking statements.

These forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially from those contemplated by the relevant forward-looking statement.

The principal risk factors that could cause actual performance and future actions to differ materially from the forward-looking statements include, but are not limited to, those relating to global and local political and or economic developments in or affecting countries where we have operations, such as inflation, trade wars, global slowdowns, or recessions, competition, geopolitical tensions, shifts in global trade patterns, changes in demand for our services as a result of automation, dependence on and costs of attracting and retaining qualified and experienced consultants, impact of inflationary pressures on our profitability, maintaining our relationships with customers and suppliers and retaining key employees, maintaining our brand name and professional reputation, potential legal liability and regulatory developments, portability of client relationships, consolidation of or within the industries we serve, changes and developments in governmental laws and regulations, evolving investor and customer expectations with regard to corporate responsibility matters, currency fluctuations in our international operations, risks related to growth, alignment of our cost structure, including as a result of workforce, real estate, and other restructuring initiatives, restrictions imposed by off-limits agreements, reliance on information processing systems, cyber security vulnerabilities or events, changes to data security, data privacy, and data protection laws, dependence on third parties for the execution of critical functions, limited protection of our intellectual property (“IP”), our ability to enhance and develop new technology, including artificial intelligence ("AI"), our ability to successfully recover from a disaster or other business continuity problems, employment liability risk, an impairment in the carrying value of goodwill and other intangible assets, treaties, or regulations on our business and our Company, deferred tax assets that we may not be able to use, our ability to develop new products and services, changes in our accounting estimates and assumptions, the utilization and billing rates of our consultants, seasonality, the expansion of social media platforms, the ability to effect acquisitions and integrate acquired businesses, including Trilogy International ("Trilogy"), resulting organizational changes, our indebtedness, the ultimate magnitude and duration of any future pandemics or similar outbreaks, and related restrictions and operational requirements that apply to our business and the businesses of our clients, and any related negative impacts on our business, employees, customers and our ability to provide services in affected regions, and the matters disclosed under the heading “Risk Factors” in the Company’s Exchange Act reports, including Item 1A included in this Annual Report on Form 10-K.

These forward-looking statements are subject to risks and uncertainties that could cause our actual results or outcomes, or the timing of our results or outcomes, to differ materially from those contemplated by the relevant forward-looking statement.

The principal risk factors that could cause actual performance, results, outcomes and timing and future actions to differ materially from the forward-looking statements include, but are not limited to, those relating to global and local political and or economic developments in or affecting countries where we have operations, such as inflation, trade wars, global slowdowns, or recessions, competition, geopolitical tensions, shifts in global trade patterns, changes in demand for our services as a result of automation, dependence on and costs of attracting and retaining qualified and experienced consultants, impact of inflationary pressures on our profitability, maintaining our relationships with customers and suppliers and retaining key employees, maintaining our brand name and professional reputation, potential legal liability and regulatory developments, portability of client relationships, consolidation of or within the industries we serve, changes and developments in governmental laws and regulations, evolving investor and customer expectations with regard to corporate responsibility matters, currency fluctuations in our international operations, risks related to growth, alignment of our cost structure, including as a result of workforce, real estate, and other restructuring initiatives, restrictions imposed by off-limits agreements, reliance on information processing systems, cyber security vulnerabilities or events, changes to data security, data privacy, and data protection laws, dependence on third parties for the execution of critical functions, limited protection of our intellectual property (“IP”), our ability to enhance and develop new technology, including artificial intelligence (“AI”), our ability to successfully recover from a disaster or other business continuity problems, employment liability risk, an impairment in the carrying value of goodwill and other intangible assets, the impact of treaties or regulations on our business and our Company, deferred tax assets that we may not be able to use, our ability to develop new products and services, changes in our accounting estimates and assumptions, the utilization and billing rates of our consultants, seasonality, the use of social media platforms, the ability to effect acquisitions and integrate acquired businesses, resulting organizational changes, our indebtedness, the ultimate magnitude and duration of any future pandemics or similar outbreaks, and related restrictions and operational requirements that apply to our business and the businesses of our clients, and any related negative impacts on our business, employees, customers and our ability to provide services in affected regions, and the matters disclosed under the heading “Risk Factors” in the Company’s Exchange Act reports, including Item 1A included in this Annual Report on Form 10-K.

Readers are urged to consider these factors carefully in evaluating the forward-looking statements.

The forward-looking statements included in this Annual Report on Form 10-K are made only as of the date of this Annual Report on Form 10-K and we undertake no obligation to publicly update these forward-looking statements to reflect subsequent events or circumstances.

The forward-looking statements included in this Annual Report on Form 10-K are made only as of the date of this Annual Report on Form 10-K, and we undertake no obligation to publicly update these forward-looking statements to reflect subsequent events, circumstances or otherwise, except as required by law.

The following presentation of management’s discussion and analysis of our financial condition and results of operations should be read together with our consolidated financial statements and related notes included in this Annual Report on Form 10-K.

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Executive Summary

Korn Ferry (referred to herein as the “Company” or in the first-person notations “we,” “our” and “us”) is a global consulting firm that powers performance.

We help unlock the potential in people and unleash transformation across organizations—synchronizing strategy, operations, and talent to accelerate performance, fuel growth, and inspire a legacy of change.

That’s why the world’s most admired companies across every major industry turn to us—for a shared commitment to lasting impact and the bold ambition to Be More Than .

As client needs have grown more complex, Korn Ferry has expanded its capabilities and become a comprehensive partner for talent and organizational performance.

Today, we deliver a broad range of offerings across the talent lifecycle, combining deep expertise with scalable delivery models to meet the needs of organizations at every stage of growth.

Our talent, industry expertise, global reach, and specialized solutions come together to solve our clients’ toughest performance challenges.

We pair this with 10 billion data points, behavioral science, and powerful intellectual property—our Foundational Assets .

These assets support a broad set of Capabilities and power Integrated Solutions designed to keep pace with change.

Our Capabilities span the full talent lifecycle and are built on the strength of our Foundational Assets.

Our Capabilities consist of the following:

• Organizational Strategy - Aligning people, processes, and structure to support business goals through organizational design, role clarity, and operating model optimization.

• Assessment & Succession - Evaluating individual potential and readiness to guide hiring, promotion, mobility and succession decisions.

• Talent Acquisition - Sourcing and hiring top talent across all levels via executive search, professional recruiting, interim talent, and RPO.

• Leadership & Professional Development - Developing leaders and building critical skills through coaching, experimental learning programs, and scalable digital programs.

• Total Rewards - Designing compensation, benefits, and recognition programs that drive performance and reflect business priorities.

• Board and CEO Services - Advising boards and CEOs on leadership transitions, governance, and long-term planning.

Korn Ferry serves clients through a combination of strategic account partnerships and flexible engagement models designed to meet organizations where they are.

At the center of this model is our Marquee and Diamond Accounts Program (the “Program”)—a structured approach to managing long-term relationships with many of the world’s most complex organizations.

Clients within the Program are supported by dedicated account leaders who coordinate engagement across Korn Ferry’s full portfolio—enabling consistent delivery, deep understanding of client priorities, and early access to new offerings.

Korn Ferry (referred to herein as the “Company” or in the first-person notations “we,” “our” and “us”) is a global consulting firm that powers individual and business performance.

The impact we create spans entire organizations, but it always starts with people.

In every market cycle and every technology shift, strategy sets direction, but people make it happen.

They lead, adapt, innovate and execute the work that moves organizations forward.

For more than 50 years, we studied how people and organizations perform.

With decades of workforce intelligence and real-world experience, we've built a deep understanding of what drives organizational success, what gets in the way and what needs to change.

We put that insight into practice every day.

Korn Ferry works across the full organization—from strategy and leadership to hiring, development, rewards and the roles, skills and workforce models needed for the future.

While many firms address individual parts of that system, we look across and connect them.

By aligning leaders, teams, and organizations around a common definition of success, we help organizations make better decisions, execute with confidence and achieve stronger outcomes.

Our business is organized around three connected elements:

Foundational Assets, Capabilities, and Integrated Solutions.

Together, they allow us to apply what we know, deploy the right expertise and combine capabilities to address high-priority business challenges.

Our Foundational Assets are the proprietary data, science and IP that inform our work and help clients make better people and organizational decisions.

Our Capabilities are the areas of expertise we bring to clients.

• Organization Strategy:

Aligning people, processes, structures and operating models to support business goals.

• Assessment & Succession:

Evaluating potential, readiness and fit to guide hiring, promotion, mobility and succession decisions.

• Talent Acquisition:

Sourcing and hiring talent across all levels through executive search, professional recruiting, interim talent and Recruitment Process Outsourcing ("RPO").

• Leadership & Professional Development:

Developing leaders and building critical skills through coaching, experiential learning and scalable digital programs.

• Total Rewards:

Designing compensation, benefits, recognition and pay transparency strategies that support performance and reflect evolving regulatory and business priorities.

• Board and Chief Executive Officer ("CEO") Services:

Advising boards and CEOs on leadership transitions, governance, succession and long-term planning.

Our Integrated Solutions combine multiple Capabilities to address high-priority business challenges.

Korn Ferry serves clients through strategic account partnerships and flexible engagement models tailored to client needs.

Core to this is our Marquee and Diamond Accounts Program (the “Program”)—a structured approach to managing long-term relationships with many of the world’s most complex organizations.

Clients within the Program are supported by dedicated account leaders who coordinate engagement across Korn Ferry’s portfolio.

This model supports consistent delivery, a deeper understanding of client priorities and broader access to the firm's capabilities.

As of fiscal year-end 2026, our 350 Marquee and Diamond accounts represented approximately 40% of consolidated fee revenue—more than double their contribution at the Program’s inception.

Korn Ferry delivers services through five solution areas.

The Solution areas reflect the breadth of our talent and organizational offerings and correspond to eight reportable segments supported by centralized functions that drive consistency, innovation, and scale.

These segments represent how we currently organize and deliver our work to the market, enabling us to deliver specialized expertise at scale while remaining agile in response to evolving client needs and together, these areas comprise eight reportable segments.

These solutions reflect the breadth of our expertise and correspond to eight reportable segments supported by centralized corporate functions that help connect expertise, intelligence and delivery across the firm, driving alignment, connectivity and scale.

The five solution areas are the following:

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Our consulting teams collaborate across Korn Ferry to deliver integrated solutions that support end-to-end transformation—from strategy through execution.

Digital leads the development, integration and commercialization of products in the Korn Ferry Talent Suite, as well as enabling technology across Korn Ferry's other Solution areas.

Built on decades of proprietary data, IP, behavioral science, and talent intelligence, these tools empower data-driven decision-making and provide real-time access to benchmarks, assessments, talent development, rewards, and diagnostics across the talent lifecycle.

They are leveraged in multiple ways:

by consultants within service delivery, as embedded components of Integrated Solutions, or accessed directly by clients through subscription- and license-based models.

Digital develops and manages the technology, data, platform, and AI capabilities that power Talent Suite and help us unlock the value of our Foundational Assets.

Working closely with our Solution teams, Digital enables consultants and clients to access and apply our insights through embedded and subscription-based offerings.

Executive Search delivers industry-leading executive recruitment across global markets, powered by decades of expertise and deep industry/sector specialization and our own top-tier executive search professionals.

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Professional Search & Interim focuses on scalable, high impact recruiting and interim talent solutions at the professional level that offer flexibility and speed in dynamic business environments.

We help clients rapidly place permanent professionals and senior/professional interim leaders across business-critical functions such Finance and Accounting, IT, HR, and Operations.

Recruitment Process Outsourcing ("RPO") provides high-volume, outsourced hiring solutions that deliver end-to-end talent acquisition services for enterprise clients.

We help clients rapidly place permanent professionals and senior/professional interim leaders across business-critical functions such as Finance and Accounting, IT, Human Resources and Operations.

RPO provides high-volume, outsourced hiring solutions that deliver end-to-end talent acquisition services for enterprise clients.

These programs are delivered through global Talent Delivery Centers, using a technology-enabled platform and are designed and managed to align with each client’s business objectives, leveraging our IP, data, science and deep talent expertise.

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Performance Highlights in fiscal 2026 include:

▪ More than 80% of the executive searches we performed in fiscal 2025 were for board level, chief executive and other senior executive and general management positions.

Our more than 3,700 search engagement clients in fiscal 2025 included many of the world’s largest and most prestigious public and private companies.

▪ We have built strong client loyalty, with more than 83% of the assignments performed during fiscal 2025 having been on behalf of clients for whom we had conducted assignments in the previous three fiscal years.

▪ More than 75% of our fee revenues were generated from clients that have utilized multiple solutions.

▪ Net income attributable to Korn Ferry was $246.1 million and Adjusted EBITDA was $463.9 million in fiscal 2025.

▪ Net income attributable to Korn Ferry margin was 9.0%, a 290 basis point ("bps") increase compared to the year-ago period.

Adjusted EBITDA margin was 17.0%, a 220 bps increase compared to the year-ago period.

▪ Fee revenue was $2,907.5 million , an increase of 7% year-over-year, led by Professional Search & Interim, Executive Search and Consulting.

▪ Net income attributable to Korn Ferry was $277.4 million, with a margin of 9.5%, an increase of 50 basis points ("bps") compared to the year-ago period.

▪ Adjusted EBITDA was $497.8 million in fiscal 2026, with a margin of 17.1%.

▪ Diluted earnings per share was $5.22 in fiscal 2026.

▪ Our fiscal 2026 Marquee and Diamond Accounts fee revenue generated approximately 40% of our consolidated fee revenue and grew 8% compared to fiscal year 2025.

▪ Executive Search fee revenue increased 5.0% in fiscal 2025 due to a 3% increase in the w eighted-average fee billed per engagement and a 2% increase in the number of engagements billed.

On November 1, 2024, we completed the acquisition of Trilogy for $44.4 million, net of cash acquired.

Headquartered in London, Trilogy is a leading provider of digital interim talent across EMEA and in the United States.

Trilogy operates at the forefront of change, in a large addressable market, with highly relevant digital interim professional offerings and a broad EMEA footprint.

Through the combination with Trilogy, Korn Ferry's Professional Search & Interim business is expected to extend our ability to scale the Company's solutions at the intersection of talent, transformation and strategy.

▪ We have built strong client loyalty, with approximately 82% of the assignments performed during fiscal 2026 having been on behalf of clients for whom we had conducted assignments in the previous three fiscal years.

▪ More than 75% of our fee revenues were generated from clients that have utilized multiple solutions.

▪ Approximately 80% of the executive searches we performed in fiscal 2026 were for board level, chief executive and other senior executive and general management positions.

Our more than 3,700 search engagement clients in fiscal 2026 included many of the world’s largest and most prestigious public and private companies.

The Company evaluates performance and allocates resources based on the chief operating decision maker’s review of (1) fee revenue and (2) adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”).

To the extent that such charges occur, Adjusted EBITDA excludes restructuring charges, integration/acquisition costs, certain separation costs and certain non-cash charges (goodwill, intangible asset and other impairments charges).

For fiscal 2026, Adjusted EBITDA excluded $4.4 million of integration/acquisition costs and $13.9 million of gain on the modification of an office lease.

For fiscal 2025, Adjusted EBITDA excluded $8.8 million of integration/acquisition costs, $4.6 million of management separation charges due to contractual obligations upon an executive's death, $2.5 million of impairment of right-of-use assets, $1.9 million of restructuring charges, net, and $0.5 million of impairment of fixed assets.

For fiscal 2024, Adjusted EBITDA excluded $68.6 million of restructuring charges, net, $14.9 million of integration/acquisition costs, $1.6 million impairment of right-of-use assets and $1.6 million impairment of fixed assets.

For fiscal 2023, Adjusted EBITDA excluded $42.6 million of restructuring charges, net, $14.9 million of integration/acquisition costs, $5.5 million impairment of right-of-use assets and $4.4 million impairment of fixed assets.

Consolidated and subtotals of Executive Search Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures and have limitations as analytical tools.

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Revenue Recognition .

Substantially all fee revenue is derived from talent and organizational consulting services and digital sales, stand-alone or as part of a solution, fees for professional services related to executive and professional recruitment performed on a retained basis, interim services and RPO, either stand-alone or as part of a solution.

Revenue is recognized when control of the goods and services are transferred to the customer in an amount that reflects the consideration that we expect to be entitled to in exchange for those goods and services.

Revenue contracts with customers are evaluated based on the five-step model outlined in Accounting Standard Codification (“ASC”) 606 ("ASC 606"), Revenue from Contracts with Customers:

Revenue is recognized when control of the goods and services is transferred to the customer in an amount that reflects the consideration we expect to be entitled to in exchange for those goods and services.

Revenue contracts with customers are evaluated based on the five-step model outlined in Accounting Standards Codification (“ASC”) 606 (“ASC 606”), Revenue from Contracts with Customers:

(1) identify the contract with a customer;

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and (5) recognize revenue when (or as) each performance obligation is satisfied.

Consulting fee revenue is primarily recognized as services are rendered, measured by total hours incurred as a percentage of total estimated hours at completion.

Consulting fee revenue is primarily recognized as services are rendered, measured by total hours incurred as a percentage of the total estimated hours at completion.

It is possible that updated estimates for consulting engagements may vary from initial estimates with such updates being recognized in the period of determination.

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Because the IP content license has significant stand-alone functionality, revenue is recognized upon delivery and when an enforceable right to payment exists.

Revenue for tangible and digital products sold by the Company, such as books and digital files, is recognized when these products are shipped.

Fee revenue from executive and professional search activities is generally one-third of the estimated first-year cash compensation of the placed candidate, plus a percentage of the fee to cover indirect engagement-related expenses.

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The post-implementation recruitment phase represents end-to-end recruiting services to clients for which there are both fixed and variable fees, which are recognized over the period that the related recruiting services are performed.

Carrying Values .

Valuations are required under GAAP to determine the carrying value of various assets.

Goodwill is our most significant asset for which management is required to prepare a valuation.

Management must identify whether events have occurred that may impact the carrying value of goodwill and make assumptions regarding future events, such as cash flows and profitability.

Differences between the assumptions used to prepare these valuations and actual results could materially impact the carrying amount of these assets and our operating results.

As of February 1, 2025, we completed our annual qualitative test which did not indicate any impairment.

While historical performance and current expectations have resulted in fair values of goodwill in excess of carrying values, if our assumptions are not realized, it is possible that in the future an impairment charge may need to be recorded.

However, it is not possible at this time to determine if an impairment charge would result or if such a charge would be material.

Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions and factors.

As a result, there can be no assurance that the estimates and assumptions made for purposes of the annual goodwill impairment test will prove to be accurate predictions of the future.

There was no indication of potential impairment through April 30, 2025 that would have required further testing.

When a quantitative test is required the fair value of goodwill for purposes of the goodwill impairment test is determined utilizing (1) a discounted cash flow analysis based on forecasted cash flows (including estimated underlying revenue and operating income growth rates) discounted using an estimated weighted-average cost of capital for market participants and (2) a market approach, utilizing observable market data such as comparable companies in similar lines of business that are publicly traded or which are part of a public or private transaction (to the extent available).

We also reconcile the results of these analyses to its market capitalization.

If the carrying amount of a reporting unit exceeds its estimated fair value, goodwill is considered impaired and further tests are performed to measure the amount of impairment loss, if any.

Examples of events or circumstances that could reasonably be expected to negatively affect the underlying key assumptions and ultimately impact the estimated fair value of the reporting units may include such items as follows:

▪ A prolonged downturn in the business environment in which the reporting units operate;

▪ An economic climate that significantly differs from our future profitability assumptions in timing or degree;

▪ The deterioration of the labor markets;

▪ Volatility in equity and debt markets;

▪ Competition and disruption in our core business;

▪ Technological advances such as AI that impact labor markets and can diminish the value of our IP.

Results of Operations

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Management separation charges — — 4,614 0.2 — —

4,614 0.2 — — — —

Restructuring charges, net — — 1,892 0.1 68,558 2.5

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Impairment of right-of-use assets — — 2,452 0.1 1,629 0.1

Gain on modification of office lease

(13,907) (0.5) — — — —

Adjusted EBITDA $ 497,805 17.1 % $ 463,866 17.0 % $ 408,204 14.8 %

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Fiscal 2026 Compared to Fiscal 2025

Fee revenue decreased by $32.6 million, or 1%, to $2,730.1 million in fiscal 2025 compared to $2,762.7 million in fiscal 2024.

Exchange rates unfavorably impacted fee revenue by $15.4 million, or 1% in fiscal 2025 compared to fiscal 2024.

The decrease in fee revenue was primarily due to lower fee revenues in Professional Search & Interim and Consulting driven by a decline in demand due to the current economic environment and other factors, partially offset by an increase in fee revenue in Executive Search North America, Executive Search EMEA and Executive Search APAC.

Consulting reported fee revenue of $662.7 million in fiscal 2025, a decrease of $32.3 million, or 5%, compared to $695.0 million in fiscal 2024.

Exchange rates unfavorably impacted fee revenue by $4.0 million, or 1% in fiscal 2025 compared to fiscal 2024.

The decrease in fee revenue was primarily driven by a decline in demand for our organizational strategy, assessment & succession, and leadership and professional development offerings.

Digital reported fee revenue of $363.5 million in fiscal 2025, a decrease of $3.2 million, or 1%, compared to $366.7 million in fiscal 2024.

Exchange rates unfavorably impacted fee revenue by $3.9 million, or 1% in fiscal 2025 compared to fiscal 2024.

The decrease in fee revenue was primarily driven by decreases in demand for leadership and development and assessment & succession offerings, partially offset by increases in organizational strategy and total rewards offerings.

Fee revenue increased by $177.4 million, or 7%, to $2,907.5 million in fiscal 2026 compared to $2,730.1 million in fiscal 2025.

Exchange rates favorably impacted fee revenue by $48.1 million, or 2%, in fiscal 2026 compared to fiscal 2025.

The increase in fee revenue was due to higher fee revenues in Professional Search & Interim, Executive Search North America, Executive Search EMEA, Consulting and RPO.

Consulting reported fee revenue of $691.7 million in fiscal 2026, an increase of $29.0 million, or 4%, compared to $662.7 million in fiscal 2025.

Exchange rates favorably impacted fee revenue by $12.9 million, or 2%, in fiscal 2026 compared to fiscal 2025.

The increase in fee revenue was primarily driven by an increase in demand for our assessment & succession, organizational strategy and leadership development offerings.

Digital reported fee revenue of $363.5 million in fiscal 2026, essentially flat compared to $363.5 million in fiscal 2025.

Exchange rates favorably impacted fee revenue by $9.7 million, or 3%, in fiscal 2026 compared to fiscal 2025.

Executive Search North America .

Executive Search North America reported fee revenue of $583.4 million in fiscal 2026, an increase of $47.5 million, or 9%, compared to $535.9 million in fiscal 2025.

North America fee revenue increased due to a 4% increase in the number of engagements billed coupled with a 2% increase in the weighted-average fee billed per engagement (calculated using local currency) in fiscal 2025 compared to fiscal 2024.

North America’s fee revenue increased primarily due to a 6% increase in the weighted-average fee billed per engagement (calculated using local currency) and a 3% increase in the number of engagements billed in fiscal 2026 compared to fiscal 2025.

Executive Search EMEA.

Executive Search EMEA reported fee revenue of $215.1 million in fiscal 2026, an increase of $21.0 million, or 11%, compared to $194.1 million in fiscal 2025.

The increase in fee revenue was due to a 5% increase in the weighted-average fee billed per engagement (calculated using local currency) in fiscal 2025 compared to fiscal 2024.

Exchange rates favorably impacted fee revenue by $11.8 million, or 6%, in fiscal 2026 compared to fiscal 2025.

The increase in fee revenue was primarily due to a 6% increase in the number of engagements billed and a 5% increase in the weighted-average fee billed per engagement in fiscal 2026 compared to fiscal 2025.

Executive Search Asia Pacific.

Executive Search Asia Pacific reported fee revenue of $97.5 million in fiscal 2026, an increase of $10.2 million, or 12%, compared to $87.3 million in fiscal 2025.

The slight increase in fee revenue was due to a 1% increase in the number of engagements billed coupled with a 1% increase in the weighted-average fee billed per engagement (calculated using local currency) in fiscal 2025 compared to fiscal 2024.

The increase in fee revenue was primarily due to an 8% increase in the number of engagements billed and a 3% increase in weighted-average fee billed per engagement (calculated using local currency) in fiscal 2026 compared to fiscal 2025.

Executive Search Latin America.

Executive Search Latin America reported fee revenue of $28.9 million in both fiscal 2025 and 2024.

Exchange rates unfavorably impacted fee revenue by $3.5 million, or 12%, in fiscal 2025 compared to fiscal 2024.

Executive Search Latin America reported fee revenue of $28.0 million in fiscal 2026, a decrease of $0.9 million, or 3%, compared to $28.9 million in fiscal 2025.

Exchange rates favorably impacted fee revenue by $1.2 million, or 4%, in fiscal 2026 compared to fiscal 2025.

Professional Search & Interim.

Professional Search & Interim reported fee revenue of $503.5 million in fiscal 2025, a decrease of $37.1 million, or 7%, compared to $540.6 million in fiscal 2024.

The decrease in fee revenue was primarily due to a decrease in permanent placement fee revenue of $19.7 million as well as a decrease in interim fee revenue of $17.4 million, each of which resulted from lower demand in the current economic environment.

RPO reported fee revenue of $354.1 million in both fiscal 2025 and 2024.

Professional Search & Interim reported fee revenue of $561.1 million in fiscal 2026, an increase of $57.6 million, or 11%, compared to $503.5 million in fiscal 2025.

Exchange rates favorably impacted fee revenue by $6.0 million, or 1%, in fiscal 2026 compared to fiscal 2025.

Interim fee revenue increased by $39.0 million primarily due to the acquisition of Trilogy International ("Trilogy") effective November 1, 2024.

The rest of the increase was due to higher fee revenue in Permanent placement of $18.6 million in fiscal 2026 compared to fiscal 2025 due to an increase in the weighted-average fee billed per engagement.

RPO reported fee revenue of $367.1 million in fiscal 2026, an increase of $13.0 million, or 4%, compared to $354.1 million in fiscal 2025.

Exchange rates favorably impacted fee revenue by $5.5 million, or 2%, in fiscal 2026 compared to fiscal 2025.

The increase in fee revenue was primarily due to new logo clients in North America.

Compensation and Benefits

Compensation and benefits expense decreased by $86.2 million, or 5%, to $1,758.0 million in fiscal 2025 from $1,844.2 million in fiscal 2024.

The decrease in compensation and benefits expense was primarily due to a decrease in salaries and related payroll taxes of $66.6 million as a result of a 7% reduction in average headcount, a decrease of $14.9 million in deferred compensation expense due to a decrease in the fair value of participants' accounts in fiscal 2025 compared to fiscal 2024 and lower commission expense of $13.0 million.

These decreases were partially offset by an increase of $10.2 million in performance-related bonus expense.

Consulting compensation and benefits expense decreased by $26.1 million, or 5%, to $458.4 million in fiscal 2025 from $484.5 million in fiscal 2024.

The decrease in compensation and benefits expense was primarily due to a decrease in salaries and related payroll taxes of $19.1 million as a result of a 7% reduction in average headcount in fiscal 2025 compared to fiscal 2024 and a decrease in performance-related bonus expense of $14.0 million.

The decrease was partially offset by an increase in restricted stock compensation expense of $3.9 million.

Digital compensation and benefits expense decreased by $8.4 million, or 4%, to $179.5 million in fiscal 2025 from $187.9 million in fiscal 2024.

Exchange rates favorably impacted compensation and benefits by $1.6 million, or 1% in fiscal 2025 compared to fiscal 2024.

The decrease in compensation and benefits expense was primarily due to a decrease in salaries and related payroll taxes of $6.7 million as a result of a 5% reduction in average headcount in fiscal 2025 compared to fiscal 2024 and a decrease in performance-related bonus expense of $1.7 million.

Executive Search North America compensation and benefits expense decreased by $8.9 million, or 2%, to $362.3 million in fiscal 2025 compared to $371.2 million in fiscal 2024.

Compensation and benefits expense decreased primarily due to a decrease of $8.3 million in deferred compensation expense due to a decrease in the fair value of participants' accounts in fiscal 2025 compared to fiscal 2024.

Compensation and benefits expense increased by $109.0 million, or 6%, to $1,867.0 million in fiscal 2026 from $1,758.0 million in fiscal 2025.

Exchange rates unfavorably impacted compensation and benefits by $31.6 million, or 2%, in fiscal 2026 compared to fiscal 2025.

The increase in compensation and benefits expense was primarily due to an increase in performance-related bonus expense of $33.6 million due to higher fee revenue in fiscal 2026 compared to fiscal 2025.

Also contributing to the increase were higher salaries and related payroll taxes, deferred compensation expense and severance-related expenses of $29.2 million, $22.7 million and $12.2 million, respectively, in fiscal 2026 compared to fiscal 2025.

Consulting compensation and benefits expense increased by $17.7 million, or 4%, to $476.1 million in fiscal 2026 from $458.4 million in fiscal 2025.

Exchange rates unfavorably impacted compensation and benefits by $10.0 million, or 2%, in fiscal 2026 compared to fiscal 2025.

The increase in compensation and benefits expense was primarily due to increases of $15.7 million in performance-related bonus expense due to higher segment fee revenue in fiscal 2026 compared to fiscal 2025, $4.2 million in severance-related costs, and higher deferred compensation expense of $3.7 million in fiscal 2026 compared to fiscal 2025.

The increase was partially offset by a decrease of $6.7 million in restricted stock compensation expense in fiscal 2026 compared to fiscal 2025.

Digital compensation and benefits expense was $179.5 million in both fiscal 2026 and fiscal 2025.

Exchange rates unfavorably impacted compensation and benefits by $4.4 million, or 2%, in fiscal 2026 compared to fiscal 2025.

Executive Search North America compensation and benefits expense increased by $39.7 million, or 11%, to $402.0 million in fiscal 2026 compared to $362.3 million in fiscal 2025.

Compensation and benefits expense increased primarily due to an increase of $24.3 million in performance-related bonus expense due to higher segment fee revenue in fiscal 2026 compared to fiscal 2025.

Also contributing to the increase was $13.9 million more in deferred compensation expense in fiscal 2026 compared to fiscal 2025.

Executive Search EMEA compensation and benefits expense increased by $14.9 million, or 10%, to $160.3 million in fiscal 2026 compared to $145.4 million in fiscal 2025.

Exchange rates unfavorably impacted compensation and benefits by $9.0 million, or 6%, in fiscal 2026 compared to fiscal 2025.

The increase in compensation and benefits expense was primarily due to an increase in performance-related bonus expense of $8.0 million, partially offset by a decrease in severance-related expense of $2.7 million in fiscal 2025 compared to fiscal 2024.

Compensation and benefits expense increased primarily due to an increase of $9.5 million in salaries and related payroll taxes as a result of a 5% increase in average headcount in fiscal 2026 compared to fiscal 2025.

Also contributing to the increase were $3.0 million more in amortization of long-term awards and an increase in performance-related bonus expense of $2.5 million due to higher segment fee revenue in fiscal 2026 compared to fiscal 2025.

Executive Search Asia Pacific compensation and benefits expense increased by $5.2 million, or 8%, to $66.9 million in fiscal 2026 compared to $61.7 million in fiscal 2025.

The increase in compensation and benefits expense was primarily due to increases of $1.8 million and $1.5 million in performance-related bonus expense and severance-related expenses, respectively.

Executive Search Latin America compensation and benefits expense was $18.2 million in fiscal 2025, essentially flat compared to $18.7 million in fiscal 2024.

Exchange rates favorably impacted compensation and benefits by $2.2 million, or 12%, in fiscal 2025 compared to fiscal 2024.

Professional Search & Interim compensation and benefits expense decreased by $32.8 million, or 15%, to $191.6 million in fiscal 2025 compared to $224.4 million in fiscal 2024.

The decrease in compensation and benefits expense was primarily due to a decrease in commission expense of $12.3 million driven by lower segment fee revenue, a decrease in salaries and related payroll taxes of $10.2 million as a result of a 12% decrease in average headcount, and lower integration/acquisition cost of $8.6 million in fiscal 2025 compared to fiscal 2024.

RPO compensation and benefits expense decreased by $15.3 million, or 5%, to $269.0 million in fiscal 2025 from $284.3 million in fiscal 2024.

The decrease in compensation and benefits expense was primarily due to a decrease in salaries and related payroll taxes of $23.2 million as a result of a 9% decrease in average headcount, partially offset by an increase in performance-related bonus expense of $7.7 million in fiscal 2025 compared to fiscal 2024.

Corporate compensation and benefits expense was $71.9 million in fiscal 2025, essentially flat compared to $72.6 million in fiscal 2024.

The increase in compensation and benefits expense was primarily due to an increase in performance-related bonus expense of $4.2 million due to higher segment fee revenue in fiscal 2026 compared to fiscal 2025 and an increase of $1.1 million in salaries and related payroll taxes in fiscal 2026 compared to fiscal 2025.

Executive Search Latin America compensation and benefits expense increased by $0.8 million, or 4% , to $19.0 million in fiscal 2026 compared to $18.2 million in fiscal 2025.

Professional Search & Interim compensation and benefits expense increased by $13.9 million, or 7%, to $205.5 million in fiscal 2026 compared to $191.6 million in fiscal 2025.

Exchange rates unfavorably impacted compensation and benefits by $2.2 million, or 1%, in fiscal 2026 compared to fiscal 2025.

The increase in compensation and benefits expense was primarily due to an increase in salaries and related payroll taxes of $6.7 million in fiscal 2026 compared to fiscal 2025.

Also contributing to the increase were higher severance-related expenses of $3.2 million and commission expense of $2.8 million in fiscal 2026 compared to fiscal 2025.

RPO compensation and benefits expense increased by $8.4 million, or 3%, to $277.4 million in fiscal 2026 from $269.0 million in fiscal 2025.

Exchange rates unfavorably impacted compensation and benefits by $4.3 million, or 2%, in fiscal 2026 compared to fiscal 2025.

The increase in compensation and benefits expense was primarily due to the increases in use of outside contractors to support the increase on segment fee revenue, severance-related expenses, and salaries and related payroll taxes of $3.8 million, $1.9 million and $1.8 million, respectively, in fiscal 2026 compared to fiscal 2025.

Corporate compensation and benefits expense increased by $8.5 million, or 12%, to $80.4 million in fiscal 2026 compared to $71.9 million in fiscal 2025.

The increase was primarily due to increases of $3.8 million in restricted stock compensation expense, $2.7 million in salaries and related payroll taxes and $1.0 million in deferred compensation expense in fiscal 2026 compared to fiscal 2025.

General and Administrative Expenses

General and administrative expenses were $258.5 million in fiscal 2025, essentially flat compared to $259.0 million in fiscal 2024.

There were decreases in legal and other professional fees and foreign exchange loss of $2.5 million and $1.7 million, respectively, in fiscal 2025 compared to fiscal 2024.

These decreases were partially offset by an increase in integration/acquisition cost of $2.6 million as a result of the acquisition of Trilogy in fiscal 2025, and an increase of $1.4 million in marketing and business development expenses.

General and administrative expenses decreased by $10.8 million, or 4%, to $247.7 million in fiscal 2026 compared to $258.5 million in fiscal 2025.

Exchange rates unfavorably impacted general and administrative expenses by $4.3 million, or 2%, in fiscal 2026 compared to fiscal 2025.

The decrease in general and administrative expenses was primarily due to a gain from the modification of an office lease of $13.9 million in fiscal 2026 compared to fiscal 2025.

Further contributing to the decrease were decreases of $4.4 million in bad debt expense and $3.4 million in integration and acquisition costs in fiscal 2026 compared to fiscal 2025, as well as impairment charges of $3.0 million associated primarily with the reduction of the Company's real estate footprint in fiscal 2025.

These decreases were partially offset by increases in marketing and business development expenses and computer software licenses of $11.2 million and $3.6 million, respectively, in fiscal 2026 compared to fiscal 2025.

Consulting general and administrative expenses decreased by $2.9 million, or 6%, to $48.6 million in fiscal 2026 compared to $51.5 million in fiscal 2025.

The decrease in general and administrative expenses was primarily due to decreases in legal and other professional fees and foreign exchange loss of $1.2 million and $0.8 million, respectively, in fiscal 2025 compared to fiscal 2024.

Further contributing to the decrease in general and administrative expenses was an impairment of right-of-use assets of $0.6 million incurred in fiscal 2024.

Digital general and administrative expenses were $39.1 million in fiscal 2025, essentially flat compared to $39.9 million in fiscal 2024.

Executive Search North America general and administrative expenses increased by $3.7 million, or 11%, to $35.9 million in fiscal 2025 from $32.2 million in fiscal 2024.

The increase in general and administrative expenses was primarily due to increases in legal and other professional fees and impairment of right-of-use assets of $2.5 million and $2.0 million, respectively, in fiscal 2025 compared to fiscal 2024.

Executive Search EMEA general and administrative expenses were $17.0 million in fiscal 2025, essentially flat compared to $16.8 million in fiscal 2024.

Executive Search Asia Pacific general and administrative expenses decreased by $1.0 million, or 11%, to $7.8 million in fiscal 2025 from $8.8 million in fiscal 2024.

The decrease in general and administrative expenses was primarily due to a decrease in bad debt expense of $1.3 million in fiscal 2025 compared to fiscal 2024.

Executive Search Latin America general and administrative expenses decreased by $2.3 million, or 48%, to $2.5 million in fiscal 2025 from $4.8 million in fiscal 2024.

The decrease in general and administrative expenses was primarily due to the impact of a foreign exchange gain of $1.1 million in fiscal 2025 compared to a foreign exchange loss of $0.8 million in fiscal 2024.

The decrease in general and administrative expenses was primarily due to a gain from the modification of an office lease of $4.1 million in fiscal 2026 compared to fiscal 2025.

The decrease was partially offset by an increase in marketing and business development expenses of $1.4 million in fiscal 2026 compared to fiscal 2025.

Digital general and administrative expenses increased by $0.6 million, or 2%, to $39.7 million in fiscal 2026 compared to $39.1 million in fiscal 2025.

Executive Search North America general and administrative expenses decreased by $9.2 million, or 26%, to $26.7 million in fiscal 2026 from $35.9 million in fiscal 2025.

The decrease in general and administrative expenses was primarily due to lower legal and other professional fees of $5.1 million in fiscal 2026 compared to fiscal 2025.

Also contributing to the decrease was impairment charges of $2.6 million associated with the reduction of the Company's real estate footprint in fiscal 2025.

Executive Search EMEA general and administrative expenses decreased by $2.5 million, or 15%, to $14.5 million in fiscal 2026 from $17.0 million in fiscal 2025.

The decrease in general and administrative expenses was primarily due to a gain from the modification of an office lease of $3.7 million in fiscal 2026.

This decrease was partially offset by the impact of foreign currency, with a foreign currency loss of $0.1 million in fiscal 2026 compared to a foreign currency gain of $0.5 million in fiscal 2025.

Executive Search Asia Pacific general and administrative expenses increased by $1.2 million, or 15%, to $9.0 million in fiscal 2026 from $7.8 million in fiscal 2025.

The increase in general and administrative expenses was primarily due to an increase of $1.0 million in bad debt expense in fiscal 2026 compared to fiscal 2025.

Executive Search Latin America general and administrative expenses increased by $1.1 million, or 44%, to $3.6 million in fiscal 2026 from $2.5 million in fiscal 2025.

The increase in general and administrative expenses was primarily due to the impact of foreign currency, with a foreign currency loss of $0.3 million in fiscal 2026 compared to a foreign currency gain of $1.1 million in fiscal 2025.

Professional Search & Interim general and administrative expenses decreased by $4.2 million, or 21%, to $15.9 million in fiscal 2026 from $20.1 million in fiscal 2025.

The decrease in general and administrative expenses was primarily due to decreases in premise and office expense and bad debt expense of $2.2 million and $1.6 million, respectively, in fiscal 2025 compared to fiscal 2024.

RPO general and administrative expenses increased by $2.4 million, or 13%, to $21.2 million in fiscal 2025 from $18.8 million in fiscal 2024.

The increase in general and administrative expenses was primarily due to an increase in bad debt expense of $2.9 million in fiscal 2025 compared to fiscal 2024.

The decrease in general and administrative expenses was primarily due to a gain from the modification of an office lease of $2.6 million in fiscal 2026 and a decrease of $1.7 million in bad debt expense in fiscal 2026 compared to fiscal 2025.

RPO general and administrative expenses decreased by $3.8 million, or 18%, to $17.4 million in fiscal 2026 from $21.2 million in fiscal 2025.

The decrease in general and administrative expenses was primarily due to a decrease of $3.0 million in bad debt expense in fiscal 2026 compared to fiscal 2025 and a gain from the modification of an office lease of $1.5 million in fiscal 2026.

Corporate general and administrative expenses increased by $9.0 million, or 14%, to $72.3 million in fiscal 2026 compared to $63.3 million in fiscal 2025.

The increase was primarily due to increases in integration/acquisition costs of $2.4 million and $1.8 million in marketing and business development expenses in fiscal 2025 compared to fiscal 2024.

The increase in general and administrative expenses was primarily due to increases in marketing and business development expenses and legal and other professional fees of $10.1 million and $2.1 million, respectively, in fiscal 2026 compared to fiscal 2025.

These increases were partially offset by a decrease in integration and acquisition costs of $2.8 million in fiscal 2026 compared to fiscal 2025.

Cost of Services Expense

Cost of services expense consists of contractor and product costs related to the delivery of various services and products through Consulting, Digital, Professional Search & Interim and RPO.

Cost of services expense was $285.1 million in fiscal 2025, a decrease of $14.9 million, or 5%, compared to $300.0 million in fiscal 2024.

Professional Search & Interim accounts for $15.0 million of the decrease due to a decline in fee revenue in the segment as the Company's interim services have a higher cost of service expense as compared to the Company's other segments.

Cost of services expense, as a percentage of fee revenue, decreased to 10% in fiscal 2025 from 11% in fiscal 2024.

Cost of services expense was $319.2 million in fiscal 2026, an increase of $34.1 million, or 12%, compared to $285.1 million in fiscal 2025.

Professional Search & Interim accounted for $30.3 million of the increase due to an increase in fee revenue in the segment as a significant amount of interim services performed had a higher cost of service expense as compared to the Company's other segments.

Depreciation and Amortization Expenses

Depreciation and amortization expenses were $98.8 million in fiscal 2026, an increase of $18.5 million, or 23%, compared to $80.3 million in fiscal 2025.

The increase was primarily due to the technology investments made in the current and prior year in our Digital segment.

The increase was primarily due to the accelerated depreciation associated with the decision to sunset our Digital platform with the replacement of our Korn Ferry Talent Suite combined with technology investments made in the current and prior year in our Digital segment.

Restructuring Charges, Net

During the second quarter of fiscal 2024, we implemented a plan intended to eliminate excess capacity resulting from the challenging and uncertain macroeconomic business environment.

As a result, the Company recorded restructuring charges, net of $68.6 million in fiscal 2024.

During the second quarter of fiscal 2024, we implemented a plan intended to eliminate excess capacity resulting from a challenging macroeconomic business environment impacting demand.

During fiscal 2025, we recorded an adjustment to the previously recorded restructuring accruals of $1.9 million.

There were no restructuring charges during fiscal 2026.

Net Income Attributable to Korn Ferry

Net income attributable to Korn Ferry was $277.4 million in fiscal 2026, an increase of $31.3 million, or 13%, compared to $246.1 million in fiscal 2025.

The increase in net income attributable to Korn Ferry was primarily due to decreases in compensation and benefits expense, restructuring charges, net and cost of services expense in fiscal 2025 compared to fiscal 2024, partially offset by an increase in income tax provision, lower fee revenue and a decrease in other income, net.

The increase in net income attributable to Korn Ferry was primarily due to an increase in fee revenue of $177.4 million, partially offset by increases in compensation and benefits expense of $109.0 million and cost of services expense of $34.1 million in fiscal 2026 compared to fiscal 2025.

Net income attributable to Korn Ferry, as a percentage of fee revenue, was 10% and 9% in fiscal 2026 and 2025, respectively.

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Adjusted EBITDA was $497.8 million in fiscal 2026, an increase of $33.9 million, or 7%, compared to $463.9 million in fiscal 2025.

The increase in Adjusted EBITDA was primarily driven by decreases in compensation and benefits expense (excluding integration/acquisition costs and management separation charges) and cost of services expense in fiscal 2025 compared to fiscal 2024.

The increase in Adjusted EBITDA was partially offset by a decrease in fee revenue and a decrease in other income, net.

Adjusted EBITDA, as a percentage of fee revenue, was 17% in fiscal 2025 compared to 15% in fiscal 2024.

The increase in Adjusted EBITDA was driven by an increase in fee revenue, partially offset by increases in compensation and benefit expense (excluding management separation charges and integration/acquisition costs) and cost of services expense in fiscal 2026 compared to fiscal 2025.

Adjusted EBITDA, as a percentage of fee revenue, was 17.1% in both fiscal 2026 and 2025.

Consulting Adjusted EBITDA was $118.4 million in fiscal 2026, an increase of $2.9 million, or 3%, compared to $115.5 million in fiscal 2025.

This increase in Adjusted EBITDA was driven by decreases in compensation and benefits expense (excluding management separation charges), general and administrative expenses (excluding impairment of right-of-use assets), and cost of services expense in fiscal 2025 compared to fiscal 2024.

The increase in Adjusted EBITDA was partially offset by a decrease in fee revenue in fiscal 2025 compared to fiscal 2024.

Consulting Adjusted EBITDA, as a percentage of fee revenue, was 17% in fiscal 2025 compared to 16% in fiscal 2024.

Digital Adjusted EBITDA was $112.7 million in fiscal 2025, an increase of $4.0 million, or 4%, compared to $108.7 million in fiscal 2024.

This increase in Adjusted EBITDA was mainly driven by a decrease in compensation and benefits expense, partially offset by a decrease in fee revenue in fiscal 2025 compared to fiscal 2024.

Digital Adjusted EBITDA, as a percentage of fee revenue, was 31% in fiscal 2025 compared to 30% in fiscal 2024.

The increase in Adjusted EBITDA was primarily driven by an increase in fee revenue, partially offset by increases in compensation and benefits expense (excluding management separation charges) and cost of services expense in fiscal 2026 compared to fiscal 2025.

Consulting Adjusted EBITDA, as a percentage of fee revenue, was 17% in both fiscal 2026 and fiscal 2025.

Digital Adjusted EBITDA was $113.1 million in fiscal 2026, essentially flat, compared to $112.7 million in fiscal 2025.

Digital Adjusted EBITDA, as a percentage of fee revenue, was 31% in both fiscal 2026 and fiscal 2025.

Executive Search North America Adjusted EBITDA increased by $25.5 million, or 17%, to $173.7 million in fiscal 2026 compared to $148.2 million in fiscal 2025.

The increase in Adjusted EBITDA was primarily driven by an increase in fee revenue in fiscal 2025 compared to fiscal 2024.

The increase in Adjusted EBITDA was primarily driven by increases in fee revenue and other income, net coupled with lower general and administrative expenses (excluding impairment of right-of-use assets and fixed assets), partially offset by an increase in compensation and benefits expense in fiscal 2026 compared to fiscal 2025.

Executive Search North America Adjusted EBITDA, as a percentage of fee revenue, was 30% in fiscal 2026 compared to 28% in fiscal 2025.

Executive Search EMEA Adjusted EBITDA increased by $4.9 million, or 15%, to $36.6 million in fiscal 2026 compared to $31.7 million in fiscal 2025.

The increase in Adjusted EBITDA was primarily driven by an increase in fee revenue, partially offset by an increase in compensation and benefits expense in fiscal 2025 compared to fiscal 2024.

The increase in Adjusted EBITDA was primarily driven by an increase in fee revenue, partially offset by higher compensation and benefits expense and an increase in general and administrative expenses (excluding gain from modification of an office lease) in fiscal 2026 compared to fiscal 2025.

Executive Search EMEA Adjusted EBITDA, as a percentage of fee revenue, was 17% in fiscal 2026 compared to 16% in fiscal 2025.

Executive Search Asia Pacific Adjusted EBITDA decreased by $0.8 million, or 4%, to $18.1 million in fiscal 2025 compared to $18.9 million in fiscal 2024.

The decrease in Adjusted EBITDA was primarily driven by an increase in compensation and benefits expense, partially offset by an increase in fee revenue.

Executive Search Asia Pacific Adjusted EBITDA increased by $3.4 million, or 19%, to $21.5 million in fiscal 2026 compared to $18.1 million in fiscal 2025.

The increase in Adjusted EBITDA was primarily driven by an increase in fee revenue, partially offset by increases in compensation and benefits expense and general and administrative expenses in fiscal 2026 compared to fiscal 2025.

Executive Search Asia Pacific Adjusted EBITDA, as a percentage of fee revenue, was 22% in fiscal 2026 compared to 21% in fiscal 2025.

Executive Search Latin America Adjusted EBITDA increased by $2.5 million, or 45%, to $8.1 million in fiscal 2025 compared to $5.6 million in fiscal 2024.

The increase in Adjusted EBITDA was primarily driven by a decrease in general and administrative expenses in fiscal 2025 compared to fiscal 2024.

Executive Search Latin America Adjusted EBITDA decreased by $2.5 million, or 31%, to $5.6 million in fiscal 2026 compared to $8.1 million in fiscal 2025.

The decrease in Adjusted EBITDA was primarily driven by increases in general and administrative expenses and compensation and benefits expense, coupled with a decrease in fee revenue in fiscal 2026 compared to fiscal 2025.

Executive Search Latin America Adjusted EBITDA, as a percentage of fee revenue, was 20% in fiscal 2026 compared to 28% in fiscal 2025.

Professional Search & Interim Adjusted EBITDA was $121.2 million in fiscal 2026, an increase of $13.6 million, or 13%, compared to $107.6 million in fiscal 2025.

The increase in Adjusted EBITDA was mainly driven by decreases in compensation and benefits expense (excluding integration/acquisition costs), cost of services expense, and general and administrative expenses (excluding integration/acquisition costs).

These decreases were partially offset by lower fee revenue.

The increase in Adjusted EBITDA was driven by an increase in fee revenue, partially offset by increases in cost of services expense and compensation and benefits expense (excluding integration/acquisition costs).

Professional Search & Interim Adjusted EBITDA, as a percentage of fee revenue, was 22% in fiscal 2026 compared to 21% in fiscal 2025.

RPO Adjusted EBITDA was $57.7 million in fiscal 2026, an increase of $5.1 million, or 10%, compared to $52.6 million in fiscal 2025.

The increase in Adjusted EBITDA was primarily driven by a decrease in compensation and benefits expense, partially offset by an increase in general and administrative expenses (excluding impairment of right-of-use assets).

The increase in Adjusted EBITDA was primarily driven by an increase in fee revenue, partially offset by an increase in compensation and benefits expense in fiscal 2026 compared to fiscal 2025.

RPO Adjusted EBITDA, as a percentage of fee revenue, was 16% in fiscal 2026 compared to 15% in fiscal 2025.

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Other income, net was $33.7 million in fiscal 2026 compared to $19.0 million in fiscal 2025.

The difference was primarily due to lower gains from the increase in the fair value of our marketable securities that are held in trust for the settlement of the Company's obligation under the ECAP in fiscal 2025 compared to fiscal 2024.

The difference was primarily due to an increase in the gains generated from the increase in fair value of our marketable securities that are held in trust for the settlement of the Company's obligations under the ECAP in fiscal 2026 compared to fiscal 2025.

Interest Expense, Net

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Interest expense, net was $20.0 million in fiscal 2026 compared to $20.4 million in fiscal 2025.

Interest expense, net decreased due to an increase in interest income earned on cash and cash equivalent balances and investment income from our marketable securities as a result of higher average cash and cash equivalent and marketable securities balances in fiscal 2025 compared to fiscal 2024, partially offset by an increase in interest expense on deferred compensation plans.

Income Tax Provision

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This reflects a 27.7% effective tax rate for fiscal 2026 compared to a 27.2% effective tax rate for fiscal 2025.

The effective tax rate for fiscal 2025 was primarily impacted by U.S.

The effective tax rate was primarily impacted by U.S.

state income taxes and jurisdictional mix of earnings, which generally create variability in our effective tax rate over time.

The lower effective tax rate in fiscal 2024 was primarily due to a $9.7 million non-recurring tax benefit from actions taken in connection with the worldwide minimum tax that resulted in the release of a valuation allowance.

On July 4, 2025, House Resolution 1, commonly referred to as the One Big Beautiful Bill Act (the "Act") was enacted into law.

Key provisions of the Act include the extension and modification of certain provisions of the Tax Cuts and Jobs Act of 2017, changes to bonus depreciation, adjustments to business interest expense limitations, and modifications to the treatment of research and development expenditures.

The Act has multiple effective dates, with certain provisions effective in our fiscal 2026 and others becoming effective in fiscal 2027.

We have reflected the effect of the Act within the provision for income taxes and the deferred tax balances.

The Act did not materially impact our effective tax rate.

Net Income Attributable to Noncontrolling Interest

Net income attributable to noncontrolling interest represents the portion of a subsidiary’s net earnings that are attributable to shares of such subsidiary not held by Korn Ferry that are included in the consolidated results of income.

Net income attributable to noncontrolling interest represents the portion of a subsidiary’s net earnings that is attributable to shares of such subsidiary not held by Korn Ferry that are included in the consolidated statements of income.

Net income attributable to noncontrolling interest was $3.4 million and $5.0 million in fiscal 2026 and fiscal 2025, respectively.

Liquidity and Capital Resources

The Company and its Board of Directors endorse a balanced approach to capital allocation.

The Company and its Board of Directors (the "Board") endorse a balanced approach to capital allocation.

The Company’s long-term priority is to invest in growth initiatives, such as the hiring of consultants, the continued development of IP and derivative products and services and the investment in synergistic, accretive merger and acquisition transactions that are expected to earn a return that is superior to the Company's cost of capital.

Next, the Company’s capital allocation approach contemplates the return of a portion of excess capital to stockholders, in the form of a regular quarterly dividend, subject to the factors discussed below and in the “Risk Factors” section of this Annual Report on Form 10-K.

Additionally, the Company considers share repurchases on an opportunistic basis and subject to the terms of our Amended Credit Agreement (defined below) and Notes, as well as using excess cash to repay the Notes.

On November 1, 2024, we completed the acquisition of Trilogy, a provider of technology/digital interim talent across Europe and in the United States, for $44.4 million, net of cash acquired.

Trilogy is part of our Interim business, which is a part of our Professional Search & Interim segment.

Additionally, the Company considers share repurchases on an opportunistic basis and subject to the terms of our Credit Agreement (defined below) and Notes, as well as using excess cash to repay the Notes.

On December 16, 2019, we completed a private placement of the Notes with a $400.0 million principal amount pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as amended.

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The indenture governing the Notes requires that, upon the occurrence of both a Change of Control and a Rating Decline (each as defined in the indenture), we shall make an offer to purchase all of the Notes at 101% of their principal amount, and accrued and unpaid interest.

We used the proceeds from the offering of the Notes to repay $276.9 million outstanding under our prior revolving credit facility and to pay expenses and fees in connection therewith.

As of April 30, 2026, the fair value of the Notes was $396.5 million, which is based on borrowing rates currently required of notes with similar terms, maturity and credit risk.

On June 24, 2022, we entered into an amendment (the "Amendment") to our December 16, 2019 Credit Agreement (the "Credit Agreement";

as amended by the Amendment, the “Amended Credit Agreement”) with the lenders party thereto and Bank of America, National Association as administrative agent, to, among other things (i) extend the existing maturity date of the revolving facility to June 24, 2027, (ii) replace the London interbank offered rate with Term Secured Overnight Financing Rate (" SOFR ") , and (iii) replace the existing financial covenants with financial covenants described below.

The Amended Credit Agreement provides for five-year senior secured credit facilities comprised of a $650.0 million revolving credit facility (the "Revolver").

The Amended Credit Agreement also provides that, under certain circumstances, the Company may incur term loans or increase the aggregate principal amount of revolving commitments by an aggregate amount of up to $250 million plus an unlimited amount subject to a consolidated secured net leverage ratio of 3.25 to 1.00.

See Note 11 — Long-Term Debt for a further description of the Amended Credit Agreement.

The Company has a total of $645.6 million and $645.5 million available under the Revolver after $4.4 million and $4.5 million of standby letters of credit have been issued as of April 30, 2025 and 2024, respectively.

On July 1, 2025, we entered into a Credit Agreement (the “Credit Agreement”) with Wells Fargo Bank, National Association as administrative agent and other lender parties thereto.

The Credit Agreement provides for an $850.0 million five-year senior secured revolving credit facility (the “Facility”).

The Credit Agreement also provides that, under certain circumstances, we may incur term loans or increase the aggregate principal amount of revolving commitments by an aggregate amount of up to $600.0 million plus an unlimited amount subject to a consolidated secured net leverage ratio of 3.25 to 1.00.

The Credit Agreement replaced a previous credit agreement dated as of December 16, 2019 (as amended, amended and restated or otherwise modified, the “Prior Credit Agreement”) with Bank of America, National Association as administrative agent and other lenders party thereto.

We repaid all outstanding obligations under the Prior Credit Agreement, and expenses and fees in connection therewith.

See Note 11 — Long-Term Debt for a further description of the Credit Agreement.

The Company had a total of $845.7 million available under the Facility and $645.6 million available under the Prior Credit Agreement as of April 30, 2026 and 2025, respectively, after $4.3 million and $4.4 million of standby letters of credit were issued as of April 30, 2026 and 2025, respectively.

The Company had a total of $15.5 million and $13.1 million of standby letters with other financial institutions as of April 30, 2026 and 2025, respectively.

The standby letters of credit were generally issued in connection with the entry into certain office premise leases.

On December 8, 2014, the Board of Directors adopted a dividend policy to distribute to our stockholders a regular quarterly cash dividend of $0.10 per share.

The standby letters of credit were generally issued as a result of entering into office premise leases.

On December 8, 2014, the Board adopted a dividend policy to distribute to our stockholders a regular quarterly cash dividend of $0.10 per share.

Every quarter since the adoption of the dividend policy, the Company has declared a quarterly dividend.

On June 21, 2021 and 2022, the Board of Directors increased the quarterly dividend to $0.12 per share and $0.15 per share, respectively.

On June 26, 2023, the Board of Directors approved an increase of 20% in the quarterly dividend, which increased the quarterly dividend to $0.18 per share.

On December 5, 2023, the Board of Directors approved an increase of 83% in the quarterly dividend, which increased the quarterly dividend to $0.33 per share.

On June 12, 2024, the Board of Directors approved an increase in the quarterly dividend to $0.37 per share.

On March 10, 2025, the Board of Directors approved a further increase of 30% in the quarterly dividend, which increased the quarterly dividend to $0.48 per share.

The Amended Credit Agreement permits us to pay dividends to our stockholders and make share repurchases so

long as there is no default under the Amended Credit Agreement, our total funded debt to adjusted EBITDA ratio (as set forth in the Amended Credit Agreement, the “consolidated net leverage ratio”) is no greater than 5.00 to 1.00, and we are in pro forma compliance with our financial covenant.

On June 21, 2021 and 2022, the Board increased the quarterly dividend to $0.12 per share and $0.15 per share, respectively.

On June 26, 2023, the Board approved an increase of 20% in the quarterly dividend, which increased the quarterly dividend to $0.18 per share.

On December 5, 2023, the Board approved an increase of 83% in the quarterly dividend, which increased the quarterly dividend to $0.33 per share.

On June 12, 2024, the Board approved an increase in the quarterly dividend to $0.37 per share.

On March 10, 2025, the Board approved a further increase of 30% in the quarterly dividend, which increased the quarterly dividend to $0.48 per share.

On March 5, 2026, the Board approved a 15% increase in the quarterly dividend, which increased the quarterly dividend to $0.55 per share.

The Credit Agreement permits us to pay dividends to our stockholders and make share repurchases so long as there is no default under the Credit Agreement, our total funded debt to adjusted EBITDA ratio (as set forth in the Credit Agreement, the “consolidated net leverage ratio”) is no greater than 5.00 to 1.00, and we are in pro forma compliance with our financial covenants that require the Company to maintain a consolidated secured net leverage ratio of not greater than 3.75 to 1.00 (which may be temporarily increased to 4.25 following certain material acquisitions under certain circumstances) (the "Financial Covenant").

Furthermore, our Notes allow us to pay $25.0 million of dividends per fiscal year with no restrictions plus an unlimited amount of dividends so long as our consolidated total leverage ratio is not greater than 3.50 to 1.00, and there is no default under the indenture governing the Notes.

The declaration and payment of future dividends under the quarterly dividend program will be at the discretion of the Board of Directors and will depend upon many factors, including our earnings, capital requirements, financial conditions, the terms of our indebtedness and other factors our Board of Directors may deem to be relevant.

Our Board of Directors may, however, amend, revoke or suspend our dividend policy at any time and for any reason.

On June 21, 2022, our Board of Directors approved an increase to the share repurchase program of approximately $300.0 million, which at the time brought our available capacity to repurchase shares in the open market or privately negotiated transactions to $318.0 million.

The declaration and payment of future dividends under the quarterly dividend program will be at the discretion of the Board and will depend upon many factors, including our earnings, capital requirements, financial conditions, the terms of our indebtedness and other factors our Board may deem to be relevant.

Our Board may, however, amend, revoke or suspend our dividend policy at any time and for any reason.

On September 18, 2025, our Board approved an increase to the share repurchase program of $250.0 million, which at the time brought our available capacity to repurchase shares in the open market or privately negotiated transactions to $331.4 million.

The Company repurchased approximately $116.1 million and $88.9 million of the Company’s stock during fiscal 2026 and fiscal 2025, respectively.

As of April 30, 2026, $227.7 million remained available for common stock repurchases under our share repurchase program.

Any decision to continue to execute our currently outstanding share repurchase program will depend on our earnings, capital requirements, financial condition and other factors considered relevant by our Board of Directors.

Our primary source of liquidity is the fee revenue generated from our operations, supplemented by our borrowing capacity under our Amended Credit Agreement.

Our primary source of liquidity is the fee revenue generated from our operations, supplemented by our borrowing capacity under our Credit Agreement.

Our performance is subject to the general level of economic activity in the geographic regions and the industries we service.

We believe, based on current economic conditions, that our cash on hand and funds from operations and the Amended Credit Agreement will be sufficient to meet anticipated working capital, capital expenditures, general corporate requirements, debt repayments, share repurchases and dividend payments under our dividend policy during the next 12 months and thereafter for the foreseeable future.

However, if the national or global economy, credit market conditions and/or labor markets were to deteriorate in the future, including as a result of ongoing macroeconomic uncertainty due to inflation and a potential recession, such changes have and could put further negative pressure on demand for our services and affect our operating cash flows.

If these conditions were to persist over an extended period of time, we may incur negative cash flows and it might require us to access additional borrowings under the Amended Credit Agreement to meet our capital needs and/or discontinue our share repurchases and dividend policy.

We believe, based on current economic conditions, that our cash on hand and funds from operations and the Credit Agreement will be sufficient to meet anticipated working capital, capital expenditures, general corporate requirements, debt repayments, share repurchases and dividend payments under our dividend policy during the next 12 months and thereafter for the foreseeable future.

However, if the national or global economy, credit market conditions and/or labor markets were to deteriorate in the future, including as a result of ongoing macroeconomic uncertainty due to inflation and a potential recession, such changes have put and could continue to put, further negative pressure on demand for our services and affect our operating cash flows.

If these conditions were to persist over an extended period of time, we may incur negative cash flows and it might require us to access additional borrowings under the Credit Agreement to meet our capital needs and/or discontinue our share repurchases and dividend policy.

Cash and cash equivalents and marketable securities were $1,381.5 million and $1,277.0 million as of April 30, 2026 and 2025, respectively.

10 unchanged sentences

Our working capital (current assets less current liabilities) was $924.0 million as of April 30, 2026 and $794.5 million as of April 30, 2025.

The net increase in our working capital of $54.9 million as of April 30, 2025 compared to April 30, 2024 is primarily attributable to an increase in cash and cash equivalents.

The increase in cash and cash equivalents was primarily due to cash from operations, partially offset by payments of annual bonuses earned in fiscal 2024 and paid during the first quarter of fiscal 2025, repurchases of common stock and dividends paid to shareholders, purchase of property and equipment, and the acquisition of Trilogy.

The net increase in our working capital of $129.5 million as of April 30, 2026 compared to April 30, 2025 was primarily attributable to an increase in cash and cash equivalents, as well as increases in income taxes and other receivables and prepaid expenses and other assets.

These increases were partially offset by an increase in compensation and benefits payable.

The increase in cash and cash equivalents was primarily due to cash from operations, partially offset by payments of annual bonuses earned in fiscal 2025 and paid during the first quarter of fiscal 2026, purchase of property and equipment, repurchases of common stock and dividends paid to shareholders.

Income taxes and other receivables increased primarily due to lease incentives we expect to receive within a year due to the modification of an office lease that we entered into in the second quarter of fiscal 2026 and large tax payments made in fiscal 2026.

Prepaid expenses and other assets increased primarily due to an increase in prepaid advertising of sponsorship events and timing of payment of computer software licenses costs.

Compensation and benefits payable increased primarily due to higher performance-related bonus accrued for as a result of higher fee revenue in fiscal 2026 compared to fiscal 2025 and an increase in deferred compensation liability due within a year.

Cash provided by operating activities was $414.2 million in fiscal 2026 compared to $364.4 million in fiscal 2025.

Cash used in investing activities was $98.7 million in fiscal 2026 compared to $125.5 million in fiscal 2025.

The increase in cash used in investing activities was primarily due to $44.4 million in cash paid for the acquisition of Trilogy during fiscal 2025.

Further contributing to this increase was an increase of $13.3 million on cash paid for premium on company-owned life insurance policies and a decrease of $8.9 million in proceeds received from life insurance policies in fiscal 2025 compared to fiscal 2024.

The decrease from cash used in investing activities was primarily due to $44.4 million in cash paid for the acquisition of Trilogy in fiscal 2025 and an increase in proceeds received from sales/maturities of marketable securities net of purchases of $13.6 million in fiscal 2026 compared to fiscal 2025.

The decrease was partially offset by an increase in the purchase of property and equipment of $27.4 million in fiscal 2026 compared to fiscal 2025 and a decrease in proceeds from life insurance policies of $3.9 million.

Cash used in financing activities was $238.4 million in fiscal 2026 compared to $190.7 million in fiscal 2025.

The increase in cash used in financing activities was primarily due to $35.7 million more in repurchases of the Company’s common stock, as well as a $29.2 million increase in dividends paid to shareholders in fiscal 2025 compared to fiscal 2024.

The increase in cash used in financing activities was primarily due to higher repurchases of the Company’s common stock of $26.9 million and an increase in dividends paid to stockholders of $21.0 million in fiscal 2026 compared to fiscal 2025.

Off-Balance Sheet Arrangements

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Finance lease commitments 15 4,916 2,104 2,496 316 —

Accrued restructuring charges 13 169 169 — — —

Interest payments on COLI loans (2)

22 unchanged sentences

Recently Adopted Accounting Standards

In November 2023, the Financial Accounting Standards Board issued an accounting update for all public entities that are required to report segment information in accordance with Topic 280, Segment Reporting.

The amendment in this update improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expense.

The amendment in this update is effective for fiscal years beginning after December 15, 2023, and interim periods with fiscal years beginning after December 15, 2024.

We adopted this guidance in fiscal 2025 and will adopt the guidance in interim periods beginning in fiscal 2026.

The adoption of this guidance did not have a material impact on the consolidated financial statements.

In December 2023, the Financial Accounting Standards Board ("FASB") issued an amendment to the accounting update for income taxes disclosures.

The new amendments provide improvements to annual income tax disclosures by requiring specific categories in the rate reconciliation and disaggregated information for income taxes paid.

The amendment is effective for annual periods beginning after December 15, 2024, and can be applied on a prospective or retrospective basis.

We adopted this guidance on a prospective basis in fiscal 2026 and it did not have a material impact on the consolidated financial statements.

Recent Accounting Standards - Not Yet Adopted

In December 2023, the Financial Accounting Standards Board issued an accounting update for income taxes disclosures.

The new amendments provide improvements to income tax disclosures by requiring specific categories in the rate reconciliation and disaggregated information for income taxes paid.

The amendment of this update is effective for annual periods beginning after December 15, 2024, and should be applied on a prospective basis.

We will adopt this guidance in our fiscal year beginning May 1, 2025.

The adoption of this guidance is not anticipated to have a material impact on the consolidated financial statements.

In November 2024, the Financial Accounting Standards Board issued an accounting update that requires public companies to disclose, in the notes to financial statements, specified information about certain costs and expenses at each interim and annual reporting period.

The amendment in this update is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027.

We will adopt this guidance in fiscal 2028 and in interim periods beginning in fiscal 2029.

In November 2024, the FASB issued an accounting update that requires public companies to disclose, in the notes to financial statements, specified information about certain costs and expenses at each interim and annual reporting period.

This update is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027.

We will adopt this guidance in fiscal 2028 and in the interim periods beginning in fiscal 2029.

The adoption of this guidance is not anticipated to have a material impact on the consolidated financial statements.

In July 2025, the FASB issued an amendment to the accounting update for measurement of credit losses for accounts receivable and contract assets.

The amendment provides an accounting policy election when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606.

The amendment will be effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods.

Early adoption is permitted in both interim and annual reporting periods in which the financial statements have not yet been issued or made available for issuance.

We will adopt this guidance in the interim periods beginning in fiscal 2027.

The adoption of this guidance is not anticipated to have a material impact on our consolidated financial statements.

In September 2025, the FASB issued an amendment to the accounting update for internal-use software.

The new amendment removes all references to prescriptive and sequential software development stages and requires the Company to start capitalizing software costs when (1) management has authorized and committed to funding the software project and (2) it is probable that the project will be completed and the software will be used to perform the function intended.

The amendment is effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods.

Early adoption is permitted as of the beginning of an annual reporting period.

We are currently evaluating the impact of this accounting guidance on our consolidated financial statements.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis