Organizational consulting firm Korn Ferry (NYSE: KFY) reported Q4 CY2025 results topping the market’s revenue expectations, with sales up 7.2% year on year to $725 million. On the other hand, next quarter’s revenue guidance of $740 million was less impressive, coming in 1% below analysts’ estimates. Its GAAP profit of $1.23 per share was in line with analysts’ consensus estimates.

Is now the time to buy Korn Ferry? Find out by accessing our full research report, it’s free.

“Our strong quarterly performance continues to reflect the evolution of our firm,” said Gary D. Burnison, CEO, Korn Ferry.

Company Overview

With clients including 97% of the S&P 100 and operations in 103 offices across 51 countries, Korn Ferry (NYSE: KFY) is a global consulting firm that helps organizations design optimal structures, recruit talent, develop leaders, and create effective compensation strategies.

Revenue Growth

A company’s long-term sales performance is one signal of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul.

With $2.89 billion in revenue over the past 12 months, Korn Ferry is a mid-sized business services company, which sometimes brings disadvantages compared to larger competitors benefiting from better economies of scale. On the bright side, it can still flex high growth rates because it’s working from a smaller revenue base.

As you can see below, Korn Ferry’s 11% annualized revenue growth over the last five years was excellent. This shows it had high demand, a useful starting point for our analysis.

Long-term growth is the most important, but within business services, a half-decade historical view may miss new innovations or demand cycles. Korn Ferry’s recent performance shows its demand has slowed significantly as its revenue was flat over the last two years.

This quarter, Korn Ferry reported year-on-year revenue growth of 7.2%, and its $725 million of revenue exceeded Wall Street’s estimates by 2.3%. Company management is currently guiding for a 2.8% year-on-year increase in sales next quarter.

Looking further ahead, sell-side analysts expect revenue to grow 3.2% over the next 12 months. While this projection indicates its newer products and services will fuel better top-line performance, it is still below average for the sector.

WHILE YOU’RE HERE: The Next Palantir? One satellite company captures images of every point on Earth. Every single day. The Pentagon wants it. Hedge funds are using it to beat earnings. You’ve probably never heard of it.

This is what the early days of Palantir looked like before it became a $437 billion giant. Same playbook. Different technology. If you missed Palantir, you need to see this. Claim The Stock Ticker for Free HERE.

Operating Margin

Korn Ferry has managed its cost base well over the last five years. It demonstrated solid profitability for a business services business, producing an average operating margin of 12.4%.

Looking at the trend in its profitability, Korn Ferry’s operating margin decreased by 3.8 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

This quarter, Korn Ferry generated an operating margin profit margin of 12.6%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Korn Ferry’s EPS grew at 41.6% compounded annual growth rate over the last five years, higher than its 11% annualized revenue growth. However, this alone doesn’t tell us much about its business quality because its operating margin didn’t improve.

Diving into Korn Ferry’s quality of earnings can give us a better understanding of its performance. A five-year view shows that Korn Ferry has repurchased its stock, shrinking its share count by 1.1%. This tells us its EPS outperformed its revenue not because of increased operational efficiency but financial engineering, as buybacks boost per share earnings.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For Korn Ferry, its two-year annual EPS growth of 31.4% was lower than its five-year trend. We still think its growth was good and hope it can accelerate in the future.

In Q4, Korn Ferry reported EPS of $1.23, up from $1.12 in the same quarter last year. This print was close to analysts’ estimates. Over the next 12 months, Wall Street expects Korn Ferry’s full-year EPS of $5.10 to grow 8%.

Key Takeaways from Korn Ferry’s Q4 Results

It was encouraging to see Korn Ferry beat analysts’ revenue expectations this quarter. On the other hand, its revenue guidance for next quarter slightly missed and its EPS guidance for next quarter fell slightly short of Wall Street’s estimates. Overall, this was a weaker quarter. The stock traded down 3.6% to $61.31 immediately following the results.

Is Korn Ferry an attractive investment opportunity right now? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).