Heidrick & Struggles Posts 4.3 Percent Revenue Decrease

The Chicago-based firm saw 2023 annual net revenue exceed $1 billion for third consecutive year, while a record annual net revenue for On-Demand Talent and Heidrick Consulting was experienced. “These results cap off an impressive year in which we made meaningful strides on our strategic goals of growing and diversifying our revenue,” says Krishnan Rajagopalan, Heidrick & Struggles’ president and CEO, who recently announced his retirement. Hunt Scanlon Media takes a closer look inside these just released numbers from the fourth largest search firm.

February 27, 2024 – Executive search, leadership consulting, and culture shaping services provider Heidrick & Struggles / (NASDAQ:HSII) has posted global full-year revenues of $1.03 billion, a decrease of 4.3 percent, compared to $1.07 billion in 2022. The Chicago-headquartered recruiter — the fourth largest global firm as ranked by Hunt Scanlon Media — reported net income was $54.4 million and diluted earnings per share was $2.62. This compares to net income of $79.5 million and diluted earnings per share of $3.86 with an effective tax rate of 31 percent in 2022.

Executive Search net revenue decreased 13.5 percent, or $121.9 million, to $780.0 million from $901.9 million in 2022 (down 13.5 percent, or $121.6 million on a constant currency basis). In 2023, net revenue decreased 14.7 percent in the Americas, decreased 5.6 percent in Europe, and decreased 19.6 percent in Asia Pacific. All industry practices exhibited decline over the prior year with the exception of the social impact and industrial practice groups. Productivity was $1.9 million, compared to $2.3 million in 2022. The average revenue per executive search was approximately $139,000 compared to $144,000 in 2022, while confirmations decreased 10.5 percent.

On-Demand Talent increased 66.9 percent to a record net revenue of $152.5 million compared to $91.3 million in 2022 (up 64.1 percent on a constant currency basis). The increase in net revenue was primarily due to the acquisition of Atreus.

Heidrick Consulting net revenue increased 17.6 percent, to a record $94.3 million from $80.2 million in 2022 (up 16.9 percent on a constant currency basis). The increase in net revenue was primarily due to the acquisition of businessfourzero.

Fourth Quarter Results

For the fourth quarter, Heidrick recorded revenues of $253.2 million, a seven percent increase compared to consolidated net revenue of $235.7 million, a year ago. The firm experienced growth in On-Demand Talent and Heidrick Consulting, partially offset by declines in Executive Search in Asia Pacific and the Americas.

Executive Search net revenue was $184 million compared to net revenue of $192.7 million in the 2022 fourth quarter. However, executive search confirmations increased by four percent in the fourth quarter of 2023 when compared to the same period last year. Net revenue decreased 5.6 percent, or $10.7 million on a constant currency basis from the 2022 fourth quarter. Net revenue decreased 4.4 percent in the Americas (down 4.7 percent on a constant currency basis), was flat in Europe (down 4.9 percent on a constant currency basis), and decreased 11.8 percent in Asia Pacific (down 11.2 percent on a constant currency basis) when compared to the prior year fourth quarter.

Related: Heidrick & Struggles Appoints New Global and Regional Leaders

Heidrick had 414 executive search consultants at December 31, 2023, compared to 390 at December 31, 2022. Productivity, as measured by annualized executive search net revenue per consultant, was $1.8 million compared to $2.0 million in the 2022 fourth quarter, reflecting a higher number of consultants combined with lower revenue. Average revenue per executive search was approximately $138,000 compared to $150,000 in the prior year period.

On-Demand Talent net revenue was $41.1 million, an increase of 83.7 percent compared to net revenue of $22.4 million in the 2022 fourth quarter, primarily due to the acquisition of Atreus Group GmbH.

Heidrick Consulting net revenue was $28.1 million compared to net revenue of $20.7 million in the 2022 fourth quarter due to organic growth coupled with the acquisition of businessfourzero. The firm had 89 Heidrick Consulting consultants at December 31, 2023, compared to 70 at December 31, 2022.

Heidrick & Struggles Closes Atreus Acquisition
Heidrick & Struggles has closed the acquisition of Atreus, one of the leading players for executive interim management in Germany. Together, Atreus and Heidrick & Struggles’ wholly owned, U.S.-based Business Talent Group (BTG), which was acquired in 2021, constitute the company’s on-demand talent segment and build on its strong market position in this space. The brand name Atreus, well-known in the German market, will be retained, and the Atreus management team, led by Dr. Harald Linné and Rainer Nagel, will remain in place.

“We are very pleased with how we finished the year and what is reflected by our fourth quarter results, having delivered solid year over year growth in both revenue and adjusted EBITDA,” said Krishnan Rajagopalan, president and CEO. “These results cap off an impressive year in which we made meaningful strides on our strategic goals of growing and diversifying our revenue. Our diversified solutions of On-Demand Talent, Heidrick Consulting, and our nascent Heidrick Digital grew 44 percent during 2023, and exited the year representing 27 percent of our fourth quarter revenue. Additionally, our full year consolidated adjusted EBITDA margins were 12 percent, and our free cash flow allowed us to invest in two key businesses. We also continued to invest in Heidrick Digital, which not only yielded our first customers for the Heidrick Navigator SaaS product, but also advanced our enterprise platform by digitally enabling our businesses.”

Related: Heidrick & Struggles Enters Agreement to Acquire RosExpert in Russia and WE Partners in Ukraine and Kazakhstan

“As a world-class leadership advisory firm, we believe we are well positioned to take advantage of improving market conditions to grow both revenue and profitability in 2024,” said Mr. Rajagopalan. “We will continue to partner with our clients to provide them with the most comprehensive suite of services to help find them the world’s best leaders, create diverse and inclusive cultures, and transform their teams to achieve the highest levels of profitability and performance.”

Newly Appointed CEO and President

Heidrick recently announced that Mr. Rajagopalan has decided to retire, after more than 23 years with the firm. Following a planned succession process, the board has appointed Thomas L. Monahan to succeed Mr. Rajagopalan as CEO and member of the board, effective March 4. Mr. Monahan currently serves as managing partner of Norton Street Holdings and was previously president and CEO of DeVry University. Mr. Rajagopalan will step down, effective March 4, 2024, and will retire from the firm as of April 1, 2024, after which he will continue to serve as an advisor. “Search firms are highly focused on trying to leverage data, innovative technology, analytics, and IT to not only lift their client’s performance, but also their own,” said Scott Scanlon, CEO of Hunt Scanlon Media. “Bringing in this outsider at this time makes a whole lot of sense.”

“The board of directors, including Krishnan, have thoughtfully and deliberately developed this succession plan, and we are confident these leadership announcements position Heidrick & Struggles for continued success well into the future,” said Adam Warby, chairman of the board of Heidrick & Struggles. “Tom Monahan is a proven and innovative executive with a deep passion for the leadership arena and a unique view into what matters – and what works – when driving corporate performance. Tom’s decades of experience in growing technology-enabled services firms focused on delivering C-suite advice makes him the right person to build on our strengths in leadership advisory and to unlock transformative growth through our strategy of innovative diversification.

“Anyone who knows me, understands that I am passionate about the work of finding, developing, and supporting great leaders,” said Mr. Monahan. “Heidrick & Struggles has shaped the leadership advisory industry for decades. As a longtime client, I can see endless possibilities to extend our strength in search, which will continue to be the cornerstone of our strategy, and leverage our diverse assets — including our On-Demand, Consulting and Digital solutions — to deliver value for our clients and our shareholders, and I look forward to leading the company’s talented team as we help clients put the right leadership teams and strategies in place to change the world.”

Heidrick also announced that Mr. Murray, global managing partner of Executive Search, will become president, reporting to Mr. Monahan, effective March 4. In addition to continuing to lead Executive Search, he will have operational responsibility for On-Demand Talent, Heidrick Consulting and Go-to-Market in his new role. Based in Heidrick’s Boston office, Mr. Murray is a member of the global management committee and is responsible for leading the firm’s global executive search business and client operations.


Heidrick expects 2024 first quarter consolidated net revenue of between $245 million and $265 million, which may be impacted by external factors, such as the foreign exchange and interest rate environments, foreign conflicts, inflation and macroeconomic constraints on pricing actions. In addition, this outlook is based on the average currency rates in December 2023 and reflects, among other factors, management’s assumptions for the anticipated volume of new executive search confirmations, On-Demand Talent projects, and Heidrick Consulting assignments, consultant productivity, and consultant retention along with the current backlog.

Related: Heidrick & Struggles to Acquire London-based businessfourzero

Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Executive Editor; Lily Fauver, Senior Editor – Hunt Scanlon Media

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