March 9, 2022 – Korn Ferry (NYSE:KFY) has posted 2022 fiscal third quarter revenue of $680.7 million, an increase of 43 percent from the third quarter of last year. Revenue increased in all lines of business. The increase in fee revenue was driven by an increase in the number of new search engagements as well as an increase in average fee revenue per search. These increases were across all regions with the largest increase seen in North America. Growth in consulting fee revenue continues to be driven by significant client workforce transformation initiatives, including DE&I and ESG, delivered through Korn Ferry’s organization strategy, assessment and succession, and leadership development solutions. In addition, total rewards offering has increased as clients address compensation and retention issues associated with labor market dislocation and pay governance issues.
The Los Angeles-headquartered executive recruiter and leadership consultant – the largest globally and in the Americas as ranked by Hunt Scanlon Media – recorded net income of $84.1 million and record diluted and adjusted diluted earnings per share of $1.54 and $1.59 in Q3 fiscal year 2022, respectively.
“I am extremely pleased with our results during the fiscal third quarter, as Korn Ferry once again achieved new financial performance highs,” said CEO Gary D. Burnison. “We generated $681 million in fee revenue, up 43 percent year over year and a new quarterly high. Our diluted and adjusted diluted earnings per share, at $1.54 and $1.59, respectively, were also new highs.”
“Our solid performance over recent quarters is a reflection of the relevance of our strategy and solutions, the resilience of our colleagues, and the connection with our Korn Ferry brand,” Mr. Burnison said. “We are replicating and scaling our success and continuing to lead innovation at the intersection of talent and strategy in a digitally-enabled new world of work.”
Korn Ferry recently acquired Lucas Group. Financial terms of the deal were not disclosed. Lucas Group gives Korn Ferry professional search and contracting expertise which is expected to enhance the firm’s search portfolio. The addition of Lucas Group to Korn Ferry’s broader talent acquisition portfolio – spanning executive search, recruitment process outsourcing, and professional search – is expected to accelerate Korn Ferry’s ability to capture additional share of this significant market.
“This combination is the right move at the right time,” said Mr. Burnison. “Today’s workscape is being transformed before our eyes – people working anywhere, everywhere and at any time. Professionals are on the move, Boomers are retiring, and career nomads are looking for change – early and often. We are seizing this opportunity to help clients find the right talent who are highly agile with specialized skills and expertise to help them drive superior performance,” added Mr. Burnison.
New AI-Enabled Talent Analytics Platform
Korn Ferry recently expanded its digital footprint with the launch of Korn Ferry Intelligence Cloud, a new AI-enabled talent analytics platform. The HR technology combines data-driven insights with Korn Ferry’s consulting expertise and IP. Intelligence Cloud helps solve the challenges of acquiring, managing and mobilizing the right talent and skills. “Intelligence Cloud builds on Korn Ferry’s 50-plus years of consulting expertise and insights,” said Byrne Mulrooney, CEO of Korn Ferry Digital. “When combined with labor market data and our clients’ HR information system (HRIS) data, the platform helps clients better understand and act on today’s talent shortages and design talent strategies for the workforce of tomorrow.”
“Intelligence Cloud’s AI-enabled digital apps help organizations gain a clearer, real-time picture of their workforce,” Korn Ferry said in a statement. “With this holistic view, they can model how the environment might change, and map the actions needed to reach their business goals. Intelligence Cloud advances traditional HR data with a greater depth of insight and guidance, which helps uncover and develop the talent and skills organizations need. It’s also vital for creating a talent blueprint—the organization’s best possible design of its future workforce.”
“Today, with so many people on the move, shortages of skills and talent are rapidly becoming business critical,” Mr. Mulrooney said. “CHROs need a single, accurate source of insight to guide decision-making and bring talent strategy and business strategy closer together.”
Despite the continuing strength in new business trends coming out of Q3 fiscal 2022, the very recent situation in Eastern Europe presents a level of risk and uncertainty that is difficult to quantify. Korn Ferry says with this in mind and assuming no new major pandemic related lockdowns or further changes in worldwide geopolitical conditions, economic conditions, financial markets or foreign exchange rates, it expects on a consolidated basis Q4 fee revenue to be in the range of $670 million and $690 million.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media