What Happened?
Shares of organizational consulting firm Korn Ferry (NYSE: KFY) jumped 9.9% in the morning session after the company reported impressive first quarter 2025 (fiscal Q4) results which beat Wall Street's sales, operating income, and earnings per share estimates. In addition, its EPS guidance for next quarter outperformed Wall Street's estimates.
Sales grew 3% compared to the previous year, bucking the trend of growth decline in recent quarters. The growth was driven by higher fee revenue in Executive Search and Recruitment process outsourcing, partially offset by a decline in fee revenue in Consulting.
On the other hand, its revenue guidance for the next quarter slightly missed. Still, this was a strong quarter, with significant top and bottom line improvements.
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What The Market Is Telling Us
Korn Ferry’s shares are not very volatile and have only had 5 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 3 months ago when the stock gained 16.8% on the news that the company reported strong third-quarter (fiscal 2025) results, exceeding analysts' sales expectations, though its guidance for the next quarter painted a mixed picture, with earnings per share projected to outperform but revenue expected to fall short.
Also, despite the results revealing a mixed segment performance, overall sales remained flat year over year, reflecting resilience amid economic uncertainty. Overall, the quarter was solid, with profitability improvements offsetting muted revenue growth.
Korn Ferry is up 9.6% since the beginning of the year, and at $73.20 per share, it is trading close to its 52-week high of $79.40 from November 2024. Investors who bought $1,000 worth of Korn Ferry’s shares 5 years ago would now be looking at an investment worth $2,452.
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