Core Insights - FTI Consulting has appointed Josh Harris as a Senior Managing Director in the Private Equity practice within its Corporate Finance & Restructuring segment [1][2] - Mr. Harris brings nearly 20 years of experience in partnering with private equity firms and corporate clients, focusing on value creation throughout the deal lifecycle [2] - His expertise includes portfolio strategy, performance improvement, post-merger integration, and organizational restructuring [2] Company Overview - FTI Consulting is a global expert firm specializing in crisis and transformation, with over 8,100 employees across 33 countries as of March 31, 2025 [5] - The company generated $3.70 billion in revenues during fiscal year 2024 [5] Role and Responsibilities - In his new role, Mr. Harris will focus on large-scale transformations, change management, and operational design for private equity firms and clients in regulated sectors such as aerospace, defense, and technology [3][4] - His previous experience includes leadership roles at Bain & Company and PwC Strategy&, where he managed enterprise strategy and transformation projects for Fortune 200 clients [4] Strategic Focus - Mr. Harris emphasizes the need for customized solutions to complex business challenges, aiming to help clients enhance profitability through revenue growth and cost optimization [5]

FTI Consulting, Inc. First Quarter 2025 Earnings Conference Call April 24, 2025 Cautionary Note About Forward-Looking Statements This presentation includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve uncertainties and risks. Forward-looking statements include statements concerning our plans, initiatives, projections, prospects, policies, processes and practices, obje ...

FTI Consulting, Inc. (NYSE:FCN) Q1 2025 Earnings Conference Call April 24, 2025 9:00 AM ET Company Participants Mollie Hawkes - Head of IR Steven Gunby - President and CEO Ajay Sabherwal - CFO Conference Call Participants James Yaro - Goldman Sachs Tobey Sommer - Truist Andrew Nicholas - William Blair Operator Good morning, everyone, and welcome to the FTI Consulting, Inc. First Quarter 2025 Earnings Conference Call. All participants will be in a listen-only mode. Should you need assistance, please send to ...

Financial Data and Key Metrics Changes - First quarter 2025 revenues were $898.3 million, a decrease of $30.3 million or 3.3% compared to the first quarter of the previous year [49] - GAAP earnings per share (EPS) were $1.74 compared to $2.23 in the prior year quarter, while adjusted EPS was $2.29 compared to $2.23 in the prior year quarter [50] - Net income decreased to $61.8 million from $80 million in the prior year quarter, primarily due to lower revenues and a special charge [51] - Adjusted EBITDA for the first quarter 2025 was $115.2 million, or 12.8% of revenues, compared to $111.1 million, or 12% of revenues in the prior year quarter [53] Business Line Data and Key Metrics Changes - **Corporate Finance and Restructuring**: Revenues decreased by 6.1% to $343.6 million, with adjusted segment EBITDA of $55.9 million or 16.3% of segment revenues [56] - **Forensic and Litigation Consulting (FLC)**: Achieved record revenues of $190.6 million, an increase of 8.3%, with adjusted segment EBITDA of $37.5 million or 19.7% of segment revenues [59] - **Economic Consulting**: Revenues decreased by 12.1% to $179.9 million, with adjusted segment EBITDA of $14.4 million or 8% of segment revenues [62] - **Technology**: Revenues decreased by 3.5% to $97.2 million, with adjusted segment EBITDA of $11.6 million or 11.9% of segment revenues [64] - **Strategic Communications**: Revenues increased by 7.2% to $87 million, with adjusted segment EBITDA of $12.9 million or 14.8% of segment revenues [67] Market Data and Key Metrics Changes - The restructuring market is currently not particularly strong, impacting the Corporate Finance and Restructuring segment [21] - The M&A market has seen a decline, with U.S. deal volume falling 13% year over year [75] - The federal premerger notification program recorded the lowest monthly filing total in nearly five years, with only 89 transactions in March 2025 [66] Company Strategy and Development Direction - The company is focused on enhancing its visibility and expertise in various sectors, particularly in forensic and litigation consulting, which has shown strong performance [12][18] - There is a commitment to investing in talent acquisition, particularly in areas like antitrust, financial economics, and digital assets, despite the near-term financial impact [78] - The company is cautious about the potential impacts of regulatory changes on its business, particularly in areas like anti-consumer fraud and anti-money laundering [90] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the medium to long-term trajectory of the business despite current uncertainties in the market [42][43] - The company anticipates potential headwinds in 2025, particularly in the Economic Consulting segment due to recent departures and market conditions [30][34] - Management highlighted the importance of adapting to macroeconomic factors and maintaining a focus on client needs amidst regulatory changes [25][41] Other Important Information - The company funded $162 million in forgivable loans to attract new talent, which will impact adjusted EBITDA in the near term [73] - The board of directors authorized an additional $400 million for share repurchases, with approximately $568.3 million remaining available under the program [71] Q&A Session Summary Question: Impact of tariffs on business - Management noted that tariffs could have both positive and negative impacts across various segments, particularly in restructuring and supply chain consulting [83][86] Question: Effect of regulatory changes on forensic and litigation consulting - Management indicated that while there has not been a significant effect yet, potential regulatory rollbacks could impact the business in the future [89][90] Question: Guidance for the year - Management confirmed that the guidance provided at the fourth quarter 2024 earnings call remains applicable and will be updated at the second quarter earnings call [93][94] Question: Revenue headwinds from departures in Economic Consulting - Management acknowledged that the financial impact from departures is expected to be significant, with a potential increase in the estimated revenue headwind [102] Question: Trends in healthcare business within FLC - Management reported positive performance in healthcare practices, with good business activity compared to the previous year [112][113] Question: Distribution of headcount actions - Management provided details on headcount actions, indicating a balanced distribution across segments and geographies, with a slight emphasis on senior roles [119]

Core Insights - FTI Consulting reported revenue of $898.28 million for Q1 2025, a year-over-year decline of 3.3%, with an EPS of $2.29 compared to $2.23 a year ago, indicating a positive EPS surprise of 27.93% against the consensus estimate of $1.79 [1][2] Revenue Performance by Segment - Technology segment generated $97.16 million, below the average estimate of $98.64 million, reflecting a year-over-year decline of 3.5% [4] - Strategic Communications segment achieved $87.02 million, exceeding the average estimate of $86.30 million, with a year-over-year increase of 7.2% [4] - Corporate Finance & Restructuring segment reported $343.65 million, below the estimated $352.91 million, marking a decline of 6.1% year-over-year [4] - Economic Consulting segment earned $179.86 million, under the average estimate of $182.74 million, showing a year-over-year decrease of 12.1% [4] - Forensic and Litigation Consulting segment reached $190.60 million, surpassing the estimated $180.63 million, with an 8.3% increase compared to the previous year [4] Stock Performance - FTI Consulting shares have returned +3.8% over the past month, contrasting with the Zacks S&P 500 composite's -5.1% change, although the stock currently holds a Zacks Rank 4 (Sell), suggesting potential underperformance in the near term [3]

FTI Consulting (FCN) Q1 2025 Earnings Call April 24, 2025 09:00 AM ET Company Participants Mollie Hawkes - Head of Marketing, Communications & Investor RelationsSteven Gunby - President and CEOAjay Sabherwal - CFOTobey Sommer - Managing Director Conference Call Participants James Yaro - AnalystAndrew Nicholas - Equity Research Analyst Operator Good morning, everyone, and welcome to the FTI Consulting First Quarter twenty twenty five Earnings Conference Call. All participants will be in a listen only mode. A ...

Core Insights - FTI Consulting reported quarterly earnings of $2.29 per share, exceeding the Zacks Consensus Estimate of $1.79 per share, and showing a slight increase from $2.23 per share a year ago, resulting in an earnings surprise of 27.93% [1] - The company posted revenues of $898.28 million for the quarter ended March 2025, which fell short of the Zacks Consensus Estimate by 0.27% and decreased from $928.55 million year-over-year [2] - FTI Consulting has surpassed consensus EPS estimates two times over the last four quarters, while it has only topped revenue estimates once during the same period [2] Earnings Outlook - The immediate price movement of FTI Consulting's stock will largely depend on management's commentary during the earnings call and the sustainability of earnings expectations [3][4] - The current consensus EPS estimate for the upcoming quarter is $1.89, with projected revenues of $916.33 million, and for the current fiscal year, the EPS estimate is $7.85 on revenues of $3.69 billion [7] Industry Context - The Consulting Services industry, to which FTI Consulting belongs, is currently ranked in the top 9% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% of industries [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5] Stock Performance - FTI Consulting shares have declined approximately 11.8% since the beginning of the year, while the S&P 500 has decreased by 8.6% [3] - The estimate revisions trend for FTI Consulting is currently unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expectations of underperformance in the near future [6]

Core Viewpoint - FTI Consulting reported a decline in revenues and net income for the first quarter of 2025, primarily due to lower performance in the Economic Consulting and Corporate Finance & Restructuring segments, although some segments showed growth. The company also announced an increase in its share repurchase authorization. Financial Performance - First quarter 2025 revenues were $898.3 million, a decrease of $30.3 million or 3.3% from $928.6 million in the prior year quarter [2] - Net income for the first quarter was $61.8 million, down from $80.0 million in the prior year quarter, impacted by a special charge of $25.3 million related to severance and employee-related costs [2][3] - Adjusted EBITDA was $115.2 million, representing 12.8% of revenues, compared to $111.1 million or 12.0% of revenues in the prior year quarter [2] Earnings Per Share - Earnings per diluted share (EPS) for the first quarter 2025 was $1.74, down from $2.23 in the prior year quarter, with a special charge reducing EPS by $0.55 [3] - Adjusted EPS for the first quarter was $2.29, slightly up from $2.23 in the prior year quarter [3] Segment Performance - Corporate Finance & Restructuring segment revenues decreased by $22.4 million or 6.1% to $343.6 million, primarily due to lower demand for transformation and strategy services [9] - Forensic and Litigation Consulting segment revenues increased by $14.5 million or 8.3% to $190.6 million, driven by higher realized bill rates for risk and investigations services [12] - Economic Consulting segment revenues decreased by $24.7 million or 12.1% to $179.9 million, mainly due to lower demand for M&A-related services [13] - Technology segment revenues decreased by $3.6 million or 3.5% to $97.2 million, attributed to lower demand for M&A-related services [14] - Strategic Communications segment revenues increased by $5.8 million or 7.2% to $87.0 million, supported by higher demand for corporate reputation services [15] Cash Position and Capital Allocation - Net cash used in operating activities was $465.2 million for the quarter, compared to $274.8 million in the prior year quarter, primarily due to increased forgivable loan issuances and higher variable compensation [5] - The company repurchased 1,126,995 shares at an average price of $165.15, totaling $186.1 million, with approximately $264.3 million remaining for future repurchases [6][8] - Cash and cash equivalents decreased to $151.1 million from $244.0 million a year ago, with total debt net of cash at $8.9 million [7] Special Charges - The company incurred a special charge of $25.3 million in the first quarter, part of a broader restructuring effort that included a total of $33.5 million in special charges over two quarters, reflecting a reduction of approximately 5% of its workforce [16]

Financial Performance - Revenues for Q1 2025 decreased by $30.3 million, or 3.3%, to $898.3 million compared to Q1 2024[76] - Net income for Q1 2025 decreased by $18.1 million, or 22.7%, to $61.8 million compared to Q1 2024[80] - Adjusted EBITDA for Q1 2025 increased by $4.1 million, or 3.7%, to $115.2 million, with an Adjusted EBITDA Margin of 12.8%[81] - Total revenues for the three months ended March 31, 2025, were $898,282,000, a decrease of 3.2% from $928,553,000 in the same period of 2024[86] - Net income for the three months ended March 31, 2025, was $61,824,000, down 22.7% from $79,965,000 in the prior year[86] - Adjusted EBITDA for the three months ended March 31, 2025, increased to $115,164,000, compared to $111,073,000 in 2024, reflecting a growth of 3.5%[87] Cash Flow and Expenses - Free Cash Flow was an outflow of $483.0 million in Q1 2025, compared to an outflow of $279.5 million in Q1 2024[84] - Net cash used in operating activities increased by $190.4 million, or 69.3%, to $465.2 million in Q1 2025[83] - The company reported a net cash used in operating activities of $465,210,000 for the three months ended March 31, 2025, compared to $274,818,000 in 2024[89] - Unallocated corporate expenses decreased by $19.8 million, or 50.0%, to $19.8 million for the three months ended March 31, 2025, primarily due to a legal settlement gain[91] - Net cash used in investing activities was $17.8 million, a decrease of $38.4 million compared to net cash provided by investing activities of $20.6 million in the prior year[131] - Net cash used in financing activities increased by $230.9 million to $32.3 million, primarily due to $182.6 million in common stock repurchases[132] Segment Performance - The decrease in revenues was primarily due to lower performance in the Economic Consulting and Corporate Finance segments[77] - Revenues for the Corporate Finance segment decreased by $22.4 million, or 6.1%, to $343.6 million, primarily due to lower demand and realized bill rates for transformation & strategy and restructuring services[102] - Gross profit for the Corporate Finance segment decreased by $15.7 million, or 12.3%, with a gross profit margin decline of 2.3 percentage points to 32.6%[103] - Revenues for the Forensic and Litigation Consulting segment increased by $14.5 million, or 8.3%, to $190.6 million, driven by higher realized bill rates and increased demand for data & analytics services[106] - Gross profit for the Forensic and Litigation Consulting segment increased by $9.0 million, or 14.1%, with a gross profit margin of 38.1%[107] - Revenues for the Economic Consulting segment decreased by $24.7 million, or 12.1%, to $179.9 million, primarily due to lower demand for M&A-related services[110] - Gross profit for the Economic Consulting segment decreased by $3.7 million, or 8.2%, with a gross profit margin increase of 1.0 percentage points to 23.0%[111] - Revenues for the Technology segment decreased by $3.6 million, or 3.5%, to $97.2 million, primarily due to lower demand for M&A-related services[114] - Gross profit for the Technology segment decreased by $3.7 million, or 10.2%, with a gross profit margin decline of 2.5 percentage points to 33.9%[115] Employee Metrics - The total number of employees increased to 8,105 in Q1 2025 from 8,055 in Q1 2024[76] - The company experienced a net reduction in headcount of 269, or 3.2%, from December 31, 2024, to March 31, 2025[85] - The total number of billable professionals increased to 6,395, up from 6,366, reflecting a 0.5% increase year-over-year[1] - The number of billable professionals decreased by 4.5% to 937 compared to 981 in the prior year[118] Financial Obligations and Risks - Future contractual obligations include long-term obligations of $160.0 million related to outstanding borrowings under the Credit Facility as of March 31, 2025[141] - Current obligations under operating leases amount to $33.8 million, with non-current obligations totaling $201.2 million[141] - The company was contingently liable under bank guarantees totaling $13.1 million as of March 31, 2025, up from $10.9 million as of December 31, 2024[143] - Available amounts under guarantee facilities were $33.7 million as of March 31, 2025, compared to $31.8 million as of December 31, 2024[143] - Key risks include changes in demand for services, ability to recruit qualified professionals, and competition for clients and key personnel[146] - The company has no material changes in market risk exposure during the period covered by the report[148] - Future events could cause actual payments to differ from projected amounts due to various assumptions including interest rates[142] Forward-Looking Statements - The company emphasizes that forward-looking statements involve uncertainties and risks that could cause actual results to differ materially[144] - The company does not intend to publicly update or revise any forward-looking statements to reflect subsequent events or circumstances[147] - The company has guaranteed facilities totaling $46.8 million as of March 31, 2025[143] - The company anticipates additional capital expenditures of between $50 million and $60 million for the remainder of 2025, including costs related to new office space[138] - During the three months ended March 31, 2025, the company made $182.6 million in payments for common stock repurchases, with $264.3 million remaining available under the Repurchase Program[140]

Core Viewpoint - FTI Consulting (FCN) is expected to report a quarterly earnings per share (EPS) of $1.79, reflecting a year-over-year decline of 19.7%, with revenues projected at $900.7 million, down 3% from the previous year [1] Earnings Estimates - The consensus EPS estimate has been adjusted downward by 1.6% over the past 30 days, indicating a reassessment by analysts [1][2] - Changes in earnings estimates are crucial for predicting investor reactions and have shown a strong correlation with short-term stock performance [2] Revenue Projections - Revenue estimates for various segments include: - Technology: $98.64 million, a decrease of 2.1% year-over-year [4] - Strategic Communications: $86.30 million, an increase of 6.3% year-over-year [4] - Corporate Finance & Restructuring: $352.91 million, a decrease of 3.6% year-over-year [4] - Economic Consulting: $182.74 million, a decrease of 10.7% year-over-year [5] - Forensic and Litigation Consulting: $180.63 million, an increase of 2.6% year-over-year [5] Stock Performance - FTI Consulting shares have increased by 3% over the past month, contrasting with a decline of 5.6% in the Zacks S&P 500 composite [6] - The company holds a Zacks Rank of 4 (Sell), indicating expectations of underperformance relative to the overall market in the near future [6]