Korn Ferry (KFY) F1Q First Take Revenue, margin and EPS upside mitigated by a mixed F2Q outlook

Equity Research 9 September 2026 | 6:38AM PDT

Korn Ferry (KFY): F1Q First Take: Revenue, margin and EPS upside mitigated by a mixed F2Q outlook

We expect investors to have a mixed reaction to Korn Ferry’s F1Q 2027 earnings George K. Tong, CFA | release, with revenue, EBITDA margins and EPS outperforming consensus estimates, Goldman Sachs & Co. LLC and guidance for F2Q revenue coming above the Street, mitigated by a shortfall in Sami Nasir, CFA the F2Q EPS outlook vs consensus due to the AMS deal. Total fee revenue increased | Goldman Sachs & Co. LLC 7% y/y on a CC basis, accelerating from 5% growth in F4Q. New business rose 12% y/y in F1Q on a CC basis, pointing to an accelerating fee revenue growth outlook. Alex Lakritz | Goldman Sachs & Co. LLC EBITDA margins were flat y/y at 17.0%. KFY completed its $1bn acquisition of AMS on 9/1, expanding its capabilities in outsourced talent acquisition services including RPO, campus recruiting, contingent workforce management and consulting. On the earnings call, we expect investors to focus on new business trends across KFY’s new search, talent & organizational solutions and workforce solutions segments, the overall macro outlook and selling environment, traction with cross-selling, and cost take-out strategies in the current uncertain economic landscape, and the integration progress of AMS.

Exhibit 1: F1Q Actuals vs GS and FactSet Estimates $ in millions, except per share data

F1Q Actuals GS Estimates FactSet Consensus Revenue $756.5 $736.3 $737.7 y/y growth 6.8% 3.9% 4.1% y/y growth - CC 7.0% 4.0%

EBITDA $128.2 $125.5 $124.9 EBITDA margins 17.0% 17.0% 16.9%

Source: FactSet, Company data, Goldman Sachs Global Investment Research

Actuals vs GS and FactSet estimates. Fee revenue of $756.5mn increased 6.8% y/y, surpassing our 3.9% forecast and FactSet consensus of 4.1%. On a constant currency basis, fee revenue increased 7% y/y, ahead of our estimate of 4.0%. Revenue in Search (Executive and Professional Search) increased 10.4% y/y, Talent & Organizational Solutions (Digital and Consulting) was flat and Workforce Solution (RPO and Interim Search) grew 11.1%. By geography, revenue grew 9% y/y in the Americas, 4% in EMEA and 1% in APAC. EBITDA margins were flat y/y at 17.0% with operating leverage offset by higher compensation and costs of services, and came in-line our estimate and ahead of consensus of 16.9%. EPS of $1.43 beat our forecast of $1.35 and consensus of $1.36.

Goldman Sachs does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and other important disclosures, see the Disclosure Appendix, or go to Analysts employed by non-US affiliates are not registered/qualified as research analysts with FINRA in the U.S.

Goldman Sachs Korn Ferry (KFY)

Guidance vs Street. KFY introduced F2Q 2027 guidance for fee revenue of $860-878mn, EBITDA margins of 16.8-17.2% and EPS of $1.30-1.40. Guidance assumes no further changes in worldwide geopolitical conditions, economic conditions, financial markets and FX rates, and includes the addition of AMS for September and October. Guidance points to positive consensus estimate revisions for revenue and negative consensus estimate revisions for EBITDA margins and EPS, reflecting the AMS acquisition. Prior to the F1Q print, our F2Q forecasts were $731mn in revenue and $1.41 in EPS compared to FactSet consensus of $743mn in revenue and $1.46 in EPS.

Valuation: Our 12-month price target of $84 is based on 13.0x our NTM + 1YR EPS of $6.92. Our target multiple is below staffing peer median NTM P/E of 15.3x reflecting headwinds from the pro-cyclical executive search, RPO and professional search & interim businesses balanced by structural advantages enabling market share gains from cross-selling and more resilient revenue performance given a diversified business mix.

Risks: Key risks to the downside include macroeconomic headwinds, competitive threats, acquisition integration risk and FX…