FTI Consulting (FCN) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenues were $898.3M, down 3.3% year-over-year, mainly due to declines in Economic Consulting and Corporate Finance & Restructuring, partially offset by growth in Forensic & Litigation Consulting (FLC) and Strategic Communications.

• Net income was $61.8M, down 22.7% year-over-year, impacted by a $25.3M special charge for severance and employee-related costs.

• Adjusted EBITDA rose 3.7% to $115.2M (12.8% margin), driven by lower SG&A expenses and legal settlement gains.

• Adjusted EPS increased to $2.29 from $2.23, while reported EPS fell to $1.74 from $2.23 due to special charges.

• Management remains confident in medium- and long-term prospects despite near-term challenges and market volatility.

Financial highlights

• Revenue: $898.3M (down 3.3% year-over-year); net income: $61.8M (down 22.7% year-over-year).

• Adjusted EBITDA: $115.2M (up 3.7% year-over-year; 12.8% margin, up from 12.0%).

• Adjusted EPS: $2.29 (up from $2.23); GAAP EPS: $1.74 (down from $2.23) due to $25.3M special charge.

• Free cash flow was negative $483.0M, compared to negative $279.5M in the prior year.

• Cash and cash equivalents stood at $151.1M at quarter-end, down from $243.9M a year earlier.

Outlook and guidance

• 2025 guidance remains unchanged; management will reevaluate after Q2.

• Management expects annualized cost savings of approximately $85M from recent workforce reductions.

• SG&A expected to rise by $15–$20M per quarter in Q2 and Q3 due to lower legal settlements in Q1.

• Amortization of $162M in forgivable loans will impact adjusted EBITDA starting Q2.

• Management expects adequate liquidity for at least the next 12 months, supported by $151.1M in cash and $740M in available credit.