Korn Ferry (NYSE:KFY) stock fell 4.92% (As on June 14, 11:19:38 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the fourth quarter of FY 24. Operating income was $83.5 million (at an operating margin of 12.1%) in Q4 FY’24, compared to $72.6 million (at an operating margin of 9.9%) in the year-ago quarter, an increase of 15% (and 220bps). Net income attributable to Korn Ferry was $65.2 million in Q4 FY’24, compared to $47.5 million in Q4 FY’23. Adjusted EBITDA was $112.3 million in Q4 FY’24 compared to $97.9 million in Q4 FY’23. Adjusted EBITDA margin was 16.3% in Q4 FY’24, an increase of 290bps. Operating income and margin increased as a result of pro-active workforce capacity management (“workforce actions”) taken during the year and the lower cost of services expense and integration/acquisition costs compared to the year-ago quarter. Consulting and Digital both posted full year record high fee revenue at $695.0 million and $366.7 million, respectively. Subscription and License full year fee revenue increased 9% to $131 million. Consulting’s full year average hourly bill rate increased 11% to $420, with an average bill rate of $437 in the fourth quarter.

KFY in the fourth quarter of FY 24 has reported the adjusted earnings per share of $1.26, beating the analysts’ estimates for the adjusted earnings per share of $1.13, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue decline of 5 percent to $690.8 million in the fourth quarter of FY 24, beating the analysts’ estimates for revenue by 0.77%. Moderation in fee revenue from the talent acquisition offerings was buoyed by year-over-year growth in the Consulting fee revenue and stability in the Digital fee revenue, in-line with the business diversification strategy. The moderation in fee revenue in the talent acquisition offerings was driven by the challenging global economic environment.

Additionally, the company repurchased 365,000 shares of stock during the quarter for $22.9 million, bringing full year repurchases to 930,000 shares for $52.5 million. On June 12, 2024, the company increased its regular quarterly dividend to $0.37 per share, which is payable on July 31, 2024 to stockholders of record on July 3, 2024.

Q1 FY’25 fee revenue is expected to be in the range of $655 million and $675 million; and Q1 FY’25 adjusted diluted earnings per share is expected to be in the range from $1.07 to $1.17.