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Our business, financial condition or results of operations could be materially adversely affected by the occurrence of any of these risks.
+Added: Moreover, some of the factors, events, and contingencies discussed below may have occurred in the past, but the disclosures below are not representations as to whether or not the factors, events or contingencies have occurred in the past and instead reflect our beliefs and opinions as to the factors, events, or contingencies that could materially and adversely affect us in the future.
Risks Related to Our Business
−Removed: Our inability to successfully recover should we experience a disaster or other business continuity problem could cause material financial loss, loss of human capital, regulatory actions, reputational harm or legal liability.
−Removed: Should we experience a disaster or other business continuity problem, such as a natural disaster, unusual weather conditions, terrorist attack, security breach, power loss, telecommunications failure or other man-made disaster, our continued success will depend, in part, on the availability of our personnel, our office facilities, and the proper functioning of our computer, telecommunication and other related systems and operations.
−Removed: In such an event, we could experience near-term operational challenges with regard to particular areas of our operations.
−Removed: In particular, our ability to recover from any disaster or other business continuity problem will depend on our ability to protect our technology infrastructure against damage from business continuity events that could have a significant disruptive effect on our operations.
−Removed: For example, a large number of our corporate staff are based in California, which has a high level of risk from wildfires and earthquakes.
−Removed: The impacts of climate change present notable risks, including damage to assets and technology caused by extreme weather events linked to climate change and may otherwise heighten or exacerbate the occurrence of such weather events.
−Removed: We could potentially lose client data or experience material adverse interruptions to our operations or delivery of services to our clients in a disaster.
−Removed: A disaster on a significant scale or affecting certain of our key operating areas within or across regions, or our inability to successfully recover should we experience a disaster, pandemic or other business continuity problem, could materially interrupt our business operations and cause material financial loss, loss of human capital, regulatory actions, reputational harm, damaged client relationships or legal liability.
−Removed: We are limited in our ability to recruit candidates from certain of our clients due to off-limit agreements with those clients and for client relation and marketing purposes.
−Removed: Such limitations could harm our business.
−Removed: Either by agreement with clients, or for client relations or marketing purposes, we are required to or elect to refrain from, for a specified period of time, recruiting candidates from a client when conducting searches on behalf of other clients.
−Removed: These off-limit agreements can cause us to lose search opportunities to our competition.
−Removed: The duration and scope of the off-limit agreement, including whether it covers all operations of the client and its affiliates or only certain divisions of a client, generally are subject to negotiation or internal policies and may depend on factors such as the scope, size and complexity of the client’s business, the length of the client relationship and the frequency with which we have been engaged to perform executive and professional searches for the client.
−Removed: We cannot ensure that off-limit agreements will not impede our growth or our ability to attract and serve new clients, or otherwise harm our business.
We face significant competition.
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We continue to face significant competition within each of our services and product offerings.
−Removed: The human resource consulting market has been traditionally fragmented and a number of large consulting firms, such as AON, McKinsey, Mercer, Willis Towers Watson and Deloitte have built businesses in human resource consulting to serve these needs.
+Added: The human resource consulting market has been traditionally fragmented and a number of large consulting firms, such as AON, Deloitte, McKinsey, Mercer and Willis Towers Watson have built businesses in human resource consulting to serve these needs.
Our consulting business line has and continues to face competition from human resource consulting businesses.
Many of these competitors are significantly larger than Korn Ferry and have considerable resources at their disposal, allowing for potentially significant investment to grow their human resource consulting business.
−Removed: Digital products in the human resource market have been traditionally fragmented and a number of firms such as AON, Hogan, Mercer, Willis Towers Watson, KPMG, Eightfold, SHL and other boutique HR technology firms offer competitive products.
+Added: Digital products in the human resource market have been traditionally fragmented and a number of firms such as AON, Eightfold, Hogan, Mercer, SHL, Richardson/Challenger, Willis Towers Watson and other boutique HR technology firms offer competitive products.
Competitors in the digital marketplace are a combination of large, well-capitalized firms and niche players who have received multiple rounds of private financing.
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We believe the continuing development and increased availability of information technology will continue to attract new competitors, especially web-enabled professional and social networking website providers, and these providers may be facilitating a company’s ability to insource their recruiting capabilities.
−Removed: Competitors in these fields include SmashFly, iCIMS, Yello, Indeed, Google for Jobs and Jobvite.
+Added: Competitors in these fields include Google for Jobs, HireVue, iCIMS, Indeed, Jobvite, Phenom, SmashFly and Yello.
As these providers continue to evolve, they may develop offerings similar to or more expansive than ours, thereby increasing competition for our services or more broadly causing disruption in the executive search industry.
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As a result, companies may turn to such sites for their talent needs, which could negatively impact demand for the services we offer.
−Removed: Our RPO services primarily compete for business with other RPO providers such as Cielo, Alexander Mann Solutions, IBM, Allegis, WilsonHCG and Randstad while Professional Search & Interim services compete for mid-level professional search assignments with regional contingency recruitment firms and large national retained recruitment firms such as Robert Half, Michael Page, Harvey Nash, Robert Walters, TekSystems, KForce and BTG.
+Added: Our RPO services primarily compete for business with other RPO providers such as Alexander Mann Solutions, Allegis, Cielo, IBM, Randstad and WilsonHCG while Professional Search & Interim services compete for mid-level professional search assignments with regional contingency recruitment firms and large national retained recruitment firms such as BTG, Harvey Nash, KForce, Michael Page, Robert Half, Robert Walters and TekSystems.
In addition, some organizations have developed or may develop internal solutions to address talent acquisition that may be competitive with our solutions.
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Our failure to compete effectively could adversely affect our operating results and future growth.
+Added: We are limited in our ability to recruit candidates from certain of our clients due to off-limit agreements with those clients and for client relation and marketing purposes.
+Added: Such limitations could harm our business.
+Added: Either by agreement with clients, or for client relations or marketing purposes, we are required to or elect to refrain from, for a specified period of time, recruiting candidates from a client when conducting searches on behalf of other clients.
+Added: These off-limit agreements can cause us to lose search opportunities to our competition.
+Added: The duration and scope of the off-limit agreement, including whether it covers all operations of the client and its affiliates or only certain divisions of a client, generally are subject to negotiation or internal policies and may depend on factors such as the scope, size and complexity of the client’s business, the length of the client relationship and the frequency with which we have been engaged to perform executive and professional searches for the client.
+Added: We cannot ensure that off-limit agreements will not impede our growth or our ability to attract and serve new clients, or otherwise harm our business.
Failure to attract and retain qualified and experienced consultants could result in a loss of clients which in turn could cause a decline in our revenue and harm to our business.
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These other firms may be able to offer greater bonuses, incentives or compensation and benefits or more attractive lifestyle choices, career paths, office cultures, or geographic locations than we do.
−Removed: Competition for these consultants typically increases during periods of wage inflation, labor constraints, and/or low unemployment, and can result in material increases to our costs and stock usage under authorized employee stock plans, among other impacts.
+Added: Competition for these consultants typically increases during periods of wage inflation, labor constraints, and/or low unemployment, such as the period from 2021 to 2022, and can result in material increases to our costs and stock usage under authorized employee stock plans, among other impacts.
Attracting and retaining consultants in our industry is particularly important because, generally, a small number of consultants have primary responsibility for a client relationship.
Because client responsibility is so concentrated, the loss of key consultants may lead to the loss of client relationships.
−Removed: In fiscal 2024, our top six consultants generated business equal to approximately 2% of our total fee revenues.
−Removed: Furthermore, our top ten consultants generated business equal to approximately 3% of our total fee revenues.
+Added: In fiscal 2025, our top six consultants combined generated business equal to approximately 3% of our total fee revenues.
+Added: Furthermore, our top ten consultants combined generated business equal to approximately 5% of our total fee revenues.
This risk is heightened due to the general portability of a consultant’s business:
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Any decrease in the quality of our reputation, reduction in our compensation levels relative to our peers or modifications of our compensation program, whether as a result of insufficient revenue, a decline in the market price of our common stock or for any other reason, could impair our ability to retain existing consultants or attract additional qualified consultants with the requisite experience, skills and established client relationships.
−Removed: Our failure to retain our most productive consultants, whether in Executive Search, Consulting, Digital, Professional Search & Interim or RPO, or maintain the quality of service to which our clients are accustomed, as well as the ability of a departing consultant to move business to his or her new employer, could result in a loss of clients, which could in turn cause our fee revenue to decline and our business to be harmed.
+Added: Our failure to retain our most productive consultants, whether in Executive Search, Consulting, Digital, Professional Search & Interim or RPO, or maintain the quality of service to
+Added: which our clients are accustomed, as well as the ability of a departing consultant to move business to his or her new employer, could result in a loss of clients, which could in turn cause our fee revenue to decline and our business to be harmed.
We may also lose clients if the departing consultant has widespread name recognition or a reputation as a specialist in his or her line of business in a specific industry or management function.
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Failing to limit departing consultants from moving business or recruiting our consultants to a competitor could adversely affect our business, financial condition and results of operations.
−Removed: We are working to advance culture change through the continued implementation of diversity, equity and inclusion ("DE&I") initiatives throughout our organization.
−Removed: If we do not or are perceived not to successfully implement these initiatives, our ability to recruit, attract and retain talent may be adversely impacted and shifts in perspective and expectations about social issues and priorities surrounding DE&I may occur at a faster pace than we are capable of managing effectively.
+Added: We are working to advance culture change through the continued implementation of inclusion and talent development initiatives throughout our organization.
+Added: If we do not or are perceived not to successfully implement these initiatives, our ability to recruit, attract and retain talent may be adversely impacted and shifts in perspective and expectations about social issues and priorities surrounding such initiatives may occur at a faster pace than we are capable of managing effectively.
If we are unable to identify, attract and retain sufficient talent in key positions, it may prevent us from achieving our strategic vision, disrupt our business, impact revenues, increase costs, damage employee morale and affect the quality and continuity of client service.
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If any factor, including poor performance or negative publicity, whether or not true, hurts our reputation, we may experience difficulties in competing successfully for both new engagements and qualified consultants, which could seriously harm our business.
−Removed: As we develop new services, clients and practices, enter new lines of business, and focus more of our business on providing a full range of client solutions, the demands on our business and our operating and legal risks may increase.
−Removed: As part of our corporate strategy, we are attempting to leverage our research and consulting services to sell a full range of services across the life cycle of a policy, program, project or initiative, and we are regularly searching for ways to provide new services to clients, such as our entry into the Interim business and strategic acquisitions.
−Removed: This strategy, even if effectively executed, may prove insufficient in light of changes in market conditions, workforce trends, technology, competitive pressures or other external factors.
+Added: As we develop new services, obtain clients, enter new practices and lines of business, and focus more of our business on providing a full range of client solutions, the demands on our business and our operating and legal risks may increase.
+Added: As part of our corporate strategy, we are attempting to market a more unified firm bringing together the full range of our Capabilities and Solutions to address our clients' talent and organizational challenges, including to accelerate cross-Solution integration and deepen our client-centric focus, across the life cycle of a policy, program, project or initiative.
+Added: We are also regularly searching for ways to provide new services to clients, such as our entry into the Interim business in fiscal 2022 and strategic acquisitions in fiscal 2022 through fiscal 2025.
+Added: This strategy may not be effective or timely executed, due to disruptions or operational challenges that may arise from efforts to consolidate or coordinate new teams, areas of the business, or business operations.
+Added: Even if this strategy is effectively executed, may prove insufficient in light of changes in market or economic conditions, workforce trends, technology, competitive pressures or other external factors.
In addition, we plan to extend our services to new clients and into new lines of business and geographic locations.
As we focus on developing new services, clients, practice areas and lines of business;
−Removed: acquire or dispose of business;
+Added: acquire or dispose of businesses;
and engage in business in new geographic locations, our operations are exposed to additional as well as enhanced risks.
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Therefore, even if we do grow, the demands on our people and systems, controls, compliance efforts, policies and procedures may exceed the benefits of such growth, and our operating results may suffer, at least in the short-term, and perhaps in the long-term.
−Removed: Efforts involving a different focus and/or new services, clients, practice areas, lines of business, offices and geographic locations entail inherent risks associated with our inexperience and competition from mature participants in those areas.
+Added: Efforts involving a different focus and/or new services, clients, practice areas, solutions, offices and geographic locations entail inherent risks associated with our inexperience and competition from mature participants in those areas.
Our inexperience may result in costly decisions that could harm our profit and operating results.
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Future legislation, regulatory changes or policy shifts under the current U.S.
−Removed: administration or other governments could impact our business.
−Removed: Our failure to comply with applicable laws and regulations could restrict our ability to provide certain services or result in the imposition of fines and penalties, substantial regulatory and compliance costs, litigation expense, adverse publicity, and loss of revenue.
+Added: administration or other governments could in the future impact our business.
+Added: Our failure to comply with applicable laws and regulations could restrict our ability to provide certain services including to federal, state, local and foreign governments or result in the imposition of fines and penalties, substantial regulatory and compliance costs, litigation expense, adverse publicity, and loss of revenue.
We incur, and expect to continue to incur, significant expenses in our attempt to comply with these laws, and our businesses are also subject to an increasing degree of compliance oversight by regulators and by our clients.
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Any failure by us to comply with applicable laws or regulations could also result in significant liability to us from private legal actions, or may result in the cessation of our operations or portions of our operations or impositions of fines and restrictions on our ability to carry on or expand our operations.
−Removed: Our operations could also be negatively affected by changes to laws and regulations and enhanced regulatory oversight of our clients and us.
+Added: Our operations could also be negatively affected by changes to laws and regulations or their application or interpretation and enhanced regulatory oversight of our clients and us.
These changes may compel us to change our prices, may restrict our ability to implement price increases, and may limit the manner in which we conduct our business or otherwise may have a negative impact on our ability to generate revenues, earnings, and cash flows.
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Our business and operations are impacted by developing laws and regulations, as well as evolving investor and customer expectations with regard to, corporate responsibility matters and reporting, which expose us to numerous risks.
−Removed: We are subject to evolving local, state, federal and/or international laws, regulations, and expectations regarding corporate responsibility matters, including sustainability, the environment, climate change, human capital management, DE&I, procurement, philanthropy, data privacy and cybersecurity, human rights, business risks and opportunities, including shifts in market preferences for reporting, more sustainable or socially responsible products and services, and other actions.
+Added: We are subject to evolving local, state, federal and/or international laws, regulations, and expectations regarding corporate responsibility matters, including sustainability, the environment, climate change, human capital management, procurement, philanthropy, data privacy and cybersecurity, human rights, business risks and opportunities, including shifts in market preferences for reporting, more sustainable or socially responsible products and services, and other actions.
These requirements, expectations, and/or frameworks, which can include assessment and ratings published by third-party firms, are not synchronized and vary by stakeholder, industry, and geography;
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impact our business opportunities, supplier and customer choices and reputation;
+Added: limit our ability to satisfy all stakeholders, some of whom may disagree with our focus on such initiatives;
and expose us to heightened scrutiny, liability, and risks that could negatively affect us.
−Removed: We report on our aspirations, targets, and initiatives related to corporate responsibility matters (both directly and in response to third-party inquiries), including our Scope 1 and 2 emissions reduction goal for 2025 and our recently submitted goal to the Science-Based Target initiative.
+Added: We report on our aspirations, targets, and initiatives related to corporate responsibility matters (both directly and in response to third-party inquiries), including our Scope 1 and 2 emissions reduction goal for 2025 and our commitment to set future goals with the Science-Based Target initiative.
These efforts have also, and may in the future include, voluntary reporting intended to address certain third-party frameworks, such as the recommendations of the Sustainability Accounting Standards Board, the Task Force for Climate-Related Financial Disclosures and other mandatory or voluntary standards or assessments related to corporate responsibility matters.
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and efforts to mitigate or reduce our operations’ impacts from or on the environment, such as a shift to cloud technology or a leasing preference for buildings that are LEED-certified.
−Removed: We have also developed and offer corporate responsibility services and products designed to address customer demand for human capital management, DE&I, and sustainability matters within their own organizations and workforce, the success of which depends on many factors and may not be fully realized.
+Added: We have also developed and offer corporate responsibility services and products designed to address customer demand for human capital management, and sustainability matters within their own organizations and workforce, the success of which depends on many factors and may not be fully realized.
+Added: Our inability to successfully recover should we experience a disaster or other business continuity problem could cause material financial loss, loss of human capital, regulatory actions, reputational harm or legal liability.
+Added: Should we experience a disaster or other business continuity problem, such as a natural disaster, unusual weather conditions, terrorist attack, security breach, power loss, telecommunications failure or other man-made disaster, our continued success will depend, in part, on the availability of our personnel, our office facilities, and the proper functioning of our computer, telecommunication and other related systems and operations.
+Added: In such an event, we could experience near-term operational challenges with regard to particular areas of our operations.
+Added: In particular, our ability to recover from any disaster or other business continuity problem will depend on our ability to protect our technology infrastructure against damage from business continuity events that could have a significant disruptive effect on our operations.
+Added: For example, a large number of our corporate staff are based in California, which has a high level of risk from wildfires and earthquakes.
+Added: The impacts of climate change may present risks, including damage to assets and technology caused by extreme weather events and may otherwise heighten or exacerbate the occurrence of such weather events.
+Added: We could potentially lose client data or experience material adverse interruptions to our operations or delivery of services to our clients in a disaster.
+Added: A disaster on a significant scale or affecting certain of our key operating areas within or across regions, or our inability to successfully recover should we experience a disaster, pandemic or other business continuity problem, could materially interrupt our business operations and cause material financial loss, loss of human capital, regulatory actions, reputational harm, damaged client relationships or legal liability.
Risks Related to Our Profitability
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Our efforts to align our cost structure with the current realities of our markets may not be successful.
−Removed: When actual or projected fee revenues are negatively impacted by weakening customer demand, we have and may again find it necessary to take cost cutting measures so that we can minimize the impact on our profitability, such as the restructuring recently initiated in the first half of fiscal 2024.
+Added: When actual or projected fee revenues are negatively impacted by weakening customer demand, we have and may again find it necessary to take cost cutting measures so that we can minimize the impact on our profitability, such as the restructuring initiated in the first half of fiscal 2024.
Failing to maintain a balance between our cost structure and our revenue could adversely affect our business, financial condition, and results of operations and lead to negative cash flows, which in turn might require us to obtain additional financing to meet our capital needs.
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Demand for our services is affected by global economic conditions and the general level of economic activity in the geographic regions in which we operate.
−Removed: During periods of slowed economic activity, many companies hire fewer permanent employees, and our business, financial condition and results of operations may be adversely affected.
+Added: During periods of slowed economic activity, many companies hire fewer permanent employees, and our business, financial condition and results of operations has been and may in the future be adversely affected.
If unfavorable changes in regional or global economic conditions occur, our business, financial condition and results of operations could suffer.
−Removed: Accelerated and pronounced economic pressures, such as the ongoing inflationary cost pressures and rise in interest rates in the last few years, as well as geopolitical uncertainty, has and may continue to negatively impact our expense base by increasing our operating costs, including labor, borrowing, and other costs of doing business.
+Added: Accelerated and pronounced economic pressures, such as the ongoing inflationary cost pressures and recent increases in interest rates, as well as geopolitical uncertainty, has and may continue to negatively impact our expense base by increasing our operating costs, including labor, borrowing, and other costs of doing business.
Continued inflationary pressures may result in increases in operating costs that we may not be able to fully offset by raising prices for our services because if we do our clients may choose to reduce their business with us, which may reduce our operating margin.
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As a result, our financial results are affected by changes in foreign currency exchange rates or weak economic conditions in foreign markets in which we have operations, among other factors.
+Added: Global events, including political instability, international conflicts, trade disputes, economic sanctions, inflation, increasing interest rates and emerging market volatility, and the resulting uncertainties, may cause foreign currency exchange rates to fluctuate in relation to the U.S.
Fluctuations in the value of those currencies in relation to the U.S.
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it may be difficult for us to satisfy our obligations, including debt service requirements under our outstanding debt;
−Removed: our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions or other general corporate
−Removed: purposes may be impaired;
+Added: our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions or other general corporate purposes may be impaired;
requiring a substantial portion of cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, including the Notes, therefore reducing our ability to use our cash flow to fund our operations, capital expenditures, future business opportunities and other purposes;
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Use of AI may result in operational challenges, legal liability, reputational concerns and privacy concerns and competitive risks.
−Removed: Our business uses and intends to further rely on AI technology, which introduces certain risks including dependency on accurate AI performance, potential data privacy and security breaches, challenges in regulatory compliance, ethical considerations, potential workforce disruption, the risk of intellectual property infringement, and emerging technology risks.
−Removed: While we have established policies governing the use of AI technology, and we safeguard our assets, including intellectual property and sensitive information, we cannot ensure that our employees, contractors or other agents would adhere to those policies.
−Removed: Failure to address these risks adequately may negatively impact our operations, reputation and financial performance.
+Added: Our business uses and intends to further rely on AI technology, which introduces certain risks including dependency on accurate AI performance, potential data privacy and security breaches, challenges in regulatory compliance, ethical considerations, potential workforce disruption, the risk of IP infringement, and emerging technology risks.
+Added: Our employees, contractors or other agents may not adhere to our policies governing the use of AI technology and safeguarding of our assets, including IP and sensitive information.
+Added: Failure to address the risks relating to the use of AI technology adequately may negatively impact our operations, reputation and financial performance.
Additionally, other unforeseen risks stemming from our use and development of AI tools and technology may arise in the future that could adversely affect our business, financial condition and results of operations.
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Our success is directly dependent on our customers’ demands for talent.
−Removed: As technology continues to evolve, more tasks currently performed by people have been and may continue to be replaced by automation, robotics, machine learning, artificial intelligence and other technological advances outside of our control.
+Added: As technology continues to evolve, more tasks currently performed by people have been and may continue to be replaced by automation, robotics, machine learning, AI and other technological advances outside of our control.
The human resource industry has been and continues to be impacted by significant technological changes, enabling companies to offer services competitive with ours.
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Additionally, rapid changes in AI and generative AI, which involves the use of advanced algorithms and machine learning techniques to create content, generate ideas, or simulate human-like behaviors, and block chain-based technology are increasing the competitiveness landscape.
−Removed: We may not be successful in anticipating or responding to these changes and demand for our services could be further reduced by advanced technologies being deployed by our competitors.
+Added: We may not be successful in anticipating or responding to these changes and demand for our services could be further reduced by advanced technologies being deployed by our competitors or new competitors leveraging AI and other technologies to offer competitive services at lower costs and quicker turnaround, disrupting our business model.
Technological developments such as these may materially affect the cost and use of technology by our clients and demand for our services, and if we do not sufficiently invest in new technology and industry developments, or if we do not make the right strategic investments to respond to these developments and successfully drive innovation, our services and solutions, our ability to generate demand for our services, attract and retain clients, and our ability to develop and achieve a competitive advantage and continue to grow could be negatively affected.
−Removed: If we are unable to keep pace with the industry changes this could result in an impairment of goodwill or other intangible assets and would have a negative impact on our profitability and operating results.
−Removed: In some cases, we depend on key vendors and partners to provide technology and other support.
+Added: If we are unable to keep pace with industry changes this could result in an impairment of goodwill or other intangible assets and would have a negative impact on our profitability and operating results.
+Added: Reliance on third party technology to provide technology and other support for both our internal operations and delivering services to our clients could adversely affect our ability to execute our strategic initiative if these third parties fail to perform their obligations.
+Added: We depend on key vendors and partners to provide technology and other support for both our internal operations and delivering services to our clients.
If these third parties fail to perform their obligations or cease to work with us, including as a result damage or disruption from fire, power loss, system malfunctions, telecommunications failure, computer viruses, cybersecurity attacks, natural disasters, acts of war or terrorism, employee errors or malfeasance, or other events beyond our control, our ability to execute on our strategic initiatives could be adversely affected .
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Our systems and networks and the vendors who provide us services are vulnerable to incidents, including physical and electronic break-ins, attacks by hackers, computer viruses, malware, worms, router disruption, sabotage or espionage, ransomware attacks, supply chain attacks, disruptions from unauthorized access and tampering (including through social engineering such as phishing attacks), employee error and misconduct, impersonation of authorized users and coordinated denial-of-service attacks.
−Removed: We have experienced and may again in the future experience cybersecurity incidents resulting from unauthorized access to our systems, which to date have not had a material impact on our business or results of operations;
+Added: We have experienced and may again in the future experience cybersecurity incidents resulting from unauthorized access to our systems, which over the past decade have not had a material impact on our business or results of operations;
however, there is no assurance that such impacts will not be material in the future.
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We depend on our overall reputation and brand name recognition to secure new engagements.
−Removed: Perceptions that we do not adequately protect the privacy of information could inhibit attaining new engagements, qualified consultants and could potentially damage currently existing client relationships.
+Added: Perceptions that we do not adequately protect the privacy of information could inhibit attaining new engagements and/or qualified consultants and could potentially damage currently existing client relationships.
Further, unauthorized use or misuse of AI by the Company's employees, vendors or others may result in disclosure of confidential company and customer data, reputational harm, privacy law violations and legal liability.
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Data security, data privacy and data protection laws, such as the European Union General Data Protection Regulation (“GDPR”), and other evolving regulations and cross-border data transfer restrictions, may limit the use of our services, increase our costs and adversely affect our business.
−Removed: We are subject to numerous U.S.
−Removed: and foreign jurisdiction laws and regulations designed to protect client, colleague, supplier and company data, such as the GDPR, which requires companies to meet stringent requirements regarding the handling of personal data, including its use, protection and transfer and the ability of persons whose data is stored to correct or delete such data about themselves.
−Removed: Complying with the enhanced obligations imposed by the GDPR has resulted and may continue to result in additional costs to our business and has required and may further require us to amend certain of our business practices.
−Removed: Failure to meet the GDPR requirements could result in significant penalties, including fines up to 4% of annual worldwide revenue.
−Removed: The GDPR also confers a private right of action on certain individuals and associations.
+Added: We are subject to numerous laws and regulations, both within the U.S.
+Added: and internationally, designed to protect client, colleague, supplier and company data, such as the GDPR, which requires companies to meet stringent requirements regarding the handling of personal data, including its use, protection and transfer and the ability of persons whose data is stored to correct or delete such data about themselves.
+Added: Complying with the enhanced obligations imposed by laws, like the GDPR, has resulted and may continue to result in additional costs to our business and has required and may further require us to amend certain of our business practices.
+Added: Failure to meet the various legal and regulatory requirements could result in significant penalties, including fines up to 4% of annual worldwide revenue.
+Added: These laws may also confer a private right of action on certain individuals and associations.
Laws and regulations in this area are evolving and generally becoming more stringent.
−Removed: For example, the New York State Department of Financial Services has issued cybersecurity regulations that outline a variety of required security measures for protection of data.
−Removed: states, including California and Virginia, have also enacted cybersecurity laws requiring certain security measures of regulated entities that are broadly similar to GDPR requirements, such as the California Consumer Privacy Act, California Privacy Rights Act and Virginia Consumer Data Protection Act.
−Removed: New privacy laws in Colorado took effect in calendar year 2023, and we expect that other states will continue to adopt legislation in this area.
+Added: State legislatures and regulators across the globe and here in the U.S.
+Added: have significantly amplified their focus on data privacy and cybersecurity regulations this year, reflecting the growing public concern over data security.
+Added: For instance, within the U.S.
+Added: in calendar year 2024, a number of new state privacy laws were enacted, and we expect that other states will continue to adopt legislation in this area.
+Added: Department of Justice ("DOJ") became a relatively new regulator of sensitive data this year with the release of its rule regarding transfers of bulk U.S.
+Added: sensitive personal data to certain "countries of concern." In addition, enforcement of privacy and data protection laws has increased over the last calendar year.
+Added: For example, the California Privacy Protection Agency ("CPPA") issued its first-ever enforcement advisory reaffirming core principles of the California Consumer Protection Act ("CCPA"), including data minimization.
+Added: Other countries have amended their privacy laws to bring them in line with international regulations, such as the GDPR.
As these laws continue to evolve, we may be required to make changes to our services, solutions and/or products so as to enable the Company and/or our clients to meet the new legal requirements, including by taking on more onerous obligations in our contracts, limiting our storage, transfer and processing of data and, in some cases, limiting our service and/or solution offerings in certain locations.
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Acquisitions, or our inability to effect acquisitions, may have an adverse effect on our business.
−Removed: We have completed several strategic acquisitions of businesses in the last several years, including our acquisition of The Lucas Group and Patina Solutions Group, Inc.
−Removed: in fiscal 2022 and Infinity Consulting Solutions and Salo LLC in fiscal 2023.
+Added: We have completed several strategic acquisitions of businesses in the last several years, including our acquisition of Infinity Consulting Solutions and Salo LLC in fiscal 2023 and Trilogy International ("Trilogy") in fiscal 2025.
Targeted acquisitions have been and continue to be part of our growth strategy, and we may in the future selectively acquire businesses that are complementary to our existing service offerings.
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If we are unable to make strategic acquisitions, or the acquisitions we do make are not on terms favorable to us or not effected in a timely manner, it may impede the growth of our business, which could adversely impact our profitability and our stock price.
+Added: We may not be able to successfully integrate or realize the expected benefits from our acquisitions.
+Added: Our future success depends in part on our ability to complete the integration of acquisition targets successfully into our operations.
+Added: The process of integrating an acquired business subjects us to a number of risks, including:
+Added: ▪ diversion of management attention;
+Added: ▪ amortization of intangible assets, adversely affecting our reported results of operations;
+Added: ▪ inability to retain and/or integrate the management, key personnel and other employees of the acquired business;
+Added: ▪ inability to properly integrate businesses resulting in operating inefficiencies;
+Added: ▪ inability to establish uniform standards, disclosure controls and procedures, internal control over financial reporting and other systems, procedures and policies in a timely manner;
+Added: ▪ inability to retain the acquired company’s clients;
+Added: ▪ exposure to legal claims for activities of the acquired business prior to acquisition;
+Added: ▪ incurrence of additional expenses in connection with the integration process.
+Added: If our acquisitions are not successfully integrated, our business, financial condition and results of operations, as well as our professional reputation, could be materially adversely affected.
+Added: Further, we cannot assure you that acquisitions will result in the financial, operational or other benefits that we anticipate.
+Added: Some acquisitions may not be immediately accretive to earnings and some expansion may result in significant expenditures.
+Added: Businesses we acquire may have liabilities or adverse operating issues that could harm our operating results.
+Added: Businesses we acquire may have liabilities or adverse operating issues, or both, that we either fail to discover through due diligence or underestimate prior to the consummation of the acquisition.
+Added: These liabilities and/or issues may include the acquired business’ failure to comply with, or other violations of, applicable laws, rules or regulations or contractual or other obligations or liabilities.
+Added: As the successor owner, we may be financially responsible for, and may suffer harm to our reputation or otherwise be adversely affected by, such liabilities and/or issues.
+Added: An acquired business also may have problems with internal controls over financial reporting, which could in turn cause us to have significant deficiencies or material weaknesses in our own internal controls over financial reporting.
+Added: These and any other costs, liabilities, issues, and/or disruptions associated with any past or future acquisitions, and the related integration, could harm our operating results.
As a result of our acquisitions, we have substantial amounts of goodwill and intangible assets, and changes in business conditions could cause these assets to become impaired, requiring write-downs that would adversely affect our operating results.
−Removed: All of our acquisitions have been accounted for as purchases and involved purchase prices well in excess of tangible net asset values, resulting in the creation of a significant amount of goodwill and other intangible assets .
−Removed: As of April 30, 2024, goodwill and purchased intangibles accounted for approximately 25% and 2%, respectively, of our total assets.
+Added: Our acquisitions involved purchase prices well in excess of tangible net asset values, resulting in the creation of a significant amount of goodwill and other intangible assets .
+Added: As of April 30, 2025, goodwill and purchased intangibles accounted for approximate ly 25% and 2%, respectively, of our total assets.
We review goodwill and intangible assets annually (or more frequently, if impairment indicators arise) for impairment.
−Removed: Future events or changes in circumstances that result in an impairment of goodwill or other intangible assets would have a negative impact on our profitability and operating results.
−Removed: An impairment in the carrying value of goodwill and other intangible assets could negatively impact our consolidated results of operations and net worth.
−Removed: Goodwill is initially recorded as the excess of amounts paid over the fair value of net assets acquired.
−Removed: While goodwill is not amortized, it is reviewed for impairment at least annually or more frequently, if impairment indicators are present.
In assessing the carrying value of goodwill, we make qualitative and quantitative assumptions and estimates about revenues, operating margins, growth rates and discount rates based on our business plans, economic projections, anticipated future cash flows and marketplace data.
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We could be required to evaluate the carrying value of goodwill prior to the annual assessment if we experience unexpected, significant declines in operating results or sustained market capitalization declines.
−Removed: These types of events and the resulting analyses could result in goodwill impairment charges in the future and therefore impact the value of assets we hold, or otherwise significantly adversely affect our business, which could limit our financial flexibility and liquidity.
+Added: These types of events and the resulting analyses could result in goodwill impairment charges in the future and therefore impact the value of assets we hold, or otherwise significantly adversely affect our profitability and operating results, which could limit our financial flexibility and liquidity.
Risks Related to Global Operations
−Removed: We are a cyclical company whose performance is tied to local and global economic conditions.
+Added: We are a company whose performance is tied to local and global economic conditions that can be cyclical.
Demand for our services is affected by global economic conditions, including recessions, inflation, interest rates, tax rates and economic uncertainty, and the general level of economic activity in the geographic regions and industries in which we operate.
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If the geopolitical uncertainties result in a reduction in business confidence, when the national or global economy or credit market conditions in general deteriorate, the unemployment rate increases or any changes occur in U.S.
−Removed: trade policy (including any increases in tariffs that result in a trade war), such uncertainty or changes put negative pressure on demand for our services and our pricing, resulting in lower cash flows and a negative effect on our business, financial condition and results of operations.
+Added: trade policy (including any increases in tariffs
+Added: that result in a trade war), such uncertainty or changes put negative pressure on demand for our services and our pricing, resulting in lower cash flows and a negative effect on our business, financial condition and results of operations.
In addition, some of our clients experience reduced access to credit and lower revenues, resulting in their inability to meet their payment obligations to us.
We face risks associated with social and political instability, legal requirements and economic conditions in our international operations.
−Removed: We operate in 51 countries and, during the year ended April 30, 2024, generated 45% of our fee revenue from operations outside of the U.S.
+Added: We operate in 51 c ountries and, during the year ended April 30, 2025, generated 47% of our fee revenue from operations outside of the U.S.
We are exposed to the risk of changes in social, political, legal and economic conditions inherent in international operations.
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As a result of such restrictions, we may be limited in our ability to pay dividends unless we redeem our Notes and amend our Amended Credit Agreement or otherwise obtain a waiver from our lenders.
−Removed: In addition, as a result of general
−Removed: economic conditions, conditions in the lending markets, the results of our business or for any other reason, we may elect or be required to amend or refinance our Revolver, at or prior to maturity, or enter into additional agreements for indebtedness.
+Added: In addition, as a result of general economic conditions, conditions in the lending markets, the results of our business or for any other reason, we may elect or be required to amend or refinance our Revolver, at or prior to maturity, or enter into additional agreements for indebtedness.
Any such amendment, refinancing or additional agreement may contain covenants that could limit in a significant manner or entirely our ability to pay dividends to you.
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These claims may harm our reputation, result in financial liability and prevent us from offering some services or products.
−Removed: We may not be able to successfully integrate or realize the expected benefits from our acquisitions.
−Removed: Our future success depends in part on our ability to complete the integration of acquisition targets successfully into our operations.
−Removed: The process of integrating an acquired business subjects us to a number of risks, including:
−Removed: ▪ diversion of management attention;
−Removed: ▪ amortization of intangible assets, adversely affecting our reported results of operations;
−Removed: ▪ inability to retain and/or integrate the management, key personnel and other employees of the acquired business;
−Removed: ▪ inability to properly integrate businesses resulting in operating inefficiencies;
−Removed: ▪ inability to establish uniform standards, disclosure controls and procedures, internal control over financial reporting and other systems, procedures and policies in a timely manner;
−Removed: ▪ inability to retain the acquired company’s clients;
−Removed: ▪ exposure to legal claims for activities of the acquired business prior to acquisition;
−Removed: ▪ incurrence of additional expenses in connection with the integration process.
−Removed: If our acquisitions are not successfully integrated, our business, financial condition and results of operations, as well as our professional reputation, could be materially adversely affected.
−Removed: Further, we cannot assure you that acquisitions will result in the financial, operational or other benefits that we anticipate.
−Removed: Some acquisitions may not be immediately accretive to earnings and some expansion may result in significant expenditures.
−Removed: Businesses we acquire may have liabilities or adverse operating issues that could harm our operating results.
−Removed: Businesses we acquire may have liabilities or adverse operating issues, or both, that we either fail to discover through due diligence or underestimate prior to the consummation of the acquisition.
−Removed: These liabilities and/or issues may include the acquired business’ failure to comply with, or other violations of, applicable laws, rules or regulations or contractual or other obligations or liabilities.
−Removed: As the successor owner, we may be financially responsible for, and may suffer harm to our reputation or otherwise be adversely affected by, such liabilities and/or issues.
−Removed: An acquired business also may have problems with internal controls over financial reporting, which could in turn cause us to have significant deficiencies or material weaknesses in our own internal controls over financial reporting.
−Removed: These and any other costs, liabilities, issues, and/or disruptions associated with any past or future acquisitions, and the related integration, could harm our operating results.
We may be subject to the actions of activist stockholders, which could disrupt our business.
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Activist campaigns can create perceived uncertainties as to our future direction, strategy, or leadership and may result in the loss of potential business opportunities, harm our ability to attract new employees, investors, and customers, and cause our stock price to experience periods of volatility or stagnation.
−Removed: We face various risks related to health epidemics, pandemics, and similar outbreaks that negatively impact our operations and financial performance and those of the clients we serve.
−Removed: The ultimate magnitude of any future pandemics or similar outbreaks depends on numerous factors, the full extent of which we may not be capable of predicting.
−Removed: Our business and financial results have been, and could be in the future, adversely affected by health epidemics, pandemics, and similar outbreaks.
−Removed: Pandemics can cause a global slowdown in economic activity, a decrease in demand for a broad variety of goods and services, disruptions in global supply chains, and significant volatility and disruption of financial markets.
−Removed: Because the severity, magnitude and duration of a pandemic and its economic consequences are uncertain and vary by region, its full impact on our operations and financial performance is uncertain and difficult to predict.
−Removed: Further, a pandemic’s ultimate impact depends in part on many factors not within our control, including (1) restrictive governmental and business actions (including travel restrictions, vaccine mandates, testing requirements, and other workforce limitations), (2) economic stimulus, funding and relief programs and other governmental economic responses, (3) the effectiveness of governmental actions, (4) economic uncertainty in key global markets and financial market volatility, (5) levels of economic contraction or growth, (6) the impact of the pandemic on health and safety and (7) the availability and effectiveness of vaccines and booster shots.
−Removed: In addition, pandemics can subject our operations and financial performance to a number of risks, including operational challenges, such as heightened attention to employee health and safety, workplace disruptions or shutdowns, cybersecurity risks, supplier disruptions or delays, and travel restrictions, as well as client-related risks, as clients may experience similar disruptions, fluctuations, and restrictions that may impact our ability to provide products and services to our clients (or for clients to pay for such products and services) and may reduce demand for our products and services.
Bank failures or other events affecting financial institutions could have a material adverse effect on our business, results of operations or financial condition, or have other adverse consequences .
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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.