CRA International (CRAI) Q1 2025 earnings summary

Executive summary

• Achieved record quarterly revenue of $182 million, up 6% year-over-year, with broad-based contributions across practices and strong international growth.

• Net income rose 31.5% year-over-year to $18.0 million, with GAAP EPS up 34.4% to $2.62 and non-GAAP EPS up 13% year-over-year.

• Five practices grew year-over-year, with Energy, Finance, Intellectual Property, and Life Sciences posting double-digit revenue growth.

• Utilization improved to 76% year-over-year, supported by a replenished sales pipeline and increased project lead flow, while headcount decreased 5%.

• Maintains a diversified client base, serving 85 of the Fortune 100 and 98 of the top 100 law firms over the past two years.

Financial highlights

• Q1 FY2025 revenue reached $182 million, a 6% increase year-over-year, with non-GAAP EBITDA margin at 13.6%.

• Operating income rose to $25.5 million (14.0% of revenue), and net income margin improved to 9.9%.

• Non-GAAP net income, EPS, and EBITDA increased by 10.5%, 13%, and 10.6% year-over-year, respectively.

• Consultant headcount decreased 5% year-over-year to 947, but was flat sequentially.

• Cash and cash equivalents at quarter-end were $25.6 million, with $85 million in borrowings and $161.1 million available under the credit facility.

Outlook and guidance

• Reaffirmed full-year fiscal 2025 revenue guidance of $715–$735 million and non-GAAP EBITDA margin of 12.0%–13.0% on a constant currency basis.

• Management remains cautious due to uncertain global macroeconomic, business, and political conditions.

• Plans to continue regular quarterly dividends and share repurchases, subject to board discretion.

• Management expects current cash, cash flow, and credit facility to cover working capital and capital expenditures for at least 12 months.

• Targets mid-single-digit average annual revenue growth, primarily organic.