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Segments | 6 Months Ended
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Oct. 31, 2023
Segment Reporting [Abstract] |
Segments | Segments The Company has eight reportable segments: Consulting, Digital, Executive Search North America, Executive Search EMEA, Executive Search Asia Pacific, Executive Search Latin America, Professional Search & Interim and RPO. The Company’s eight reportable segments operate through the following five lines of business: 1.Consulting aligns organizational structure, culture, performance and people to drive sustainable growth by addressing four fundamental needs: Organizational Strategy, Assessment and Succession, Leadership and Professional Development and Total Rewards. This work is enabled by a set of Digital Performance Management Tools, based on some of the world’s leading lP and data. The Consulting teams employ an integrated approach across our core capabilities and integrated solutions, each one intended to strengthen the work and thinking in the next, to help clients execute their strategy in a digitally enabled world. 2.Digital develops technology-enabled Performance Management Tools that empower our clients. The digital products give clients direct access to Korn Ferry proprietary data, client data, and analytics to deliver clear insights with the training and tools needed to align organizational structure with business strategy. 3.Executive Search helps organizations recruit board level, chief executive and other senior executive and general management talent to deliver lasting impact. The Company’s approach to placing talent is bringing together research-based IP, proprietary assessments and behavioral interviewing with practical experience to determine the ideal organizational fit. Salary benchmarking then helps the Company build appropriate frameworks for compensation and retention. This business is managed and reported on a geographic basis and represents four of the Company’s reportable segments (Executive Search North America, Executive Search EMEA, Executive Search Asia Pacific and Executive Search Latin America). 4.Professional Search & Interim delivers enterprise talent acquisition solutions for professional level middle and upper management. The Company helps clients source high-quality candidates at speed and scale globally, covering single-hire to multi-hire permanent placements and interim contractors. 5.RPO offers scalable recruitment outsourcing solutions leveraging customized technology and talent insights. The Company's scalable solutions, built on science and powered by best-in-class technology and consulting expertise, enables the Company to act as a strategic partner in clients’ quest for superior recruitment outcomes and better candidate fit. Executive Search is managed by geographic regional leaders. Worldwide operations for Consulting, Professional Search & Interim and RPO are managed by their Chief Executive Officers. Beginning in the second quarter of fiscal 2024, Digital is led by the President of Technology. The Executive Search geographic regional leaders, the Chief Executive Officers of Consulting, Professional Search & Interim and RPO and the President of Technology report directly to the Chief Executive Officer of the Company. The Company also operates Corporate to record global expenses. The Company evaluates performance and allocates resources based on the Company’s chief operating decision maker (“CODM”) review of 1) fee revenue and 2) adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”). To the extent that such costs or charges occur, Adjusted EBITDA excludes restructuring charges, integration/acquisition costs, certain separation costs and certain non-cash charges (goodwill, intangible asset and other impairment charges). The CODM is not provided asset information by reportable segment. Financial highlights are as follows:
| Three Months Ended October 31, |  | Six Months Ended October 31,
| 2023 |  | 2022 |  | 2023 |  | 2022
| Consolidated
| (in thousands)
Fee revenue | $ | 704,003 |  |  | $ | 727,849 |  |  | $ | 1,403,192 |  |  | $ | 1,423,752 |
Total revenue | $ | 712,447 |  |  | $ | 735,719 |  |  | $ | 1,418,709 |  |  | $ | 1,438,867 |
Net (loss) income attributable to Korn Ferry | $ | (1,711) |  |  | $ | 73,541 |  |  | $ | 44,894 |  |  | $ | 150,788 |
Net income attributable to noncontrolling interest | 1,755 |  |  | 1,074 |  |  | 2,335 |  |  | 2,363 |
Other loss, net | 13,835 |  |  | 9,048 |  |  | 258 |  |  | 8,273 |
Interest expense, net | 6,596 |  |  | 7,098 |  |  | 11,336 |  |  | 14,710 |
Income tax provision | 2,341 |  |  | 28,886 |  |  | 20,761 |  |  | 55,112 |
Operating income | 22,816 |  |  | 119,647 |  |  | 79,584 |  |  | 231,246 |
Depreciation and amortization | 19,554 |  |  | 17,093 |  |  | 38,566 |  |  | 33,322 |
Other loss, net | (13,835) |  |  | (9,048) |  |  | (258) |  |  | (8,273) |
Integration/acquisition costs | 5,030 |  |  | 3,411 |  |  | 9,158 |  |  | 7,016 |
Impairment of fixed assets | 1,452 |  |  | — |  |  | 1,575 |  |  | — |
Impairment of right-of-use assets | — |  |  | — |  |  | 1,629 |  |  | — |
Restructuring charges, net | 63,525 |  |  | — |  |  | 63,946 |  |  | — |
Adjusted EBITDA (1) | $ | 98,542 |  |  | $ | 131,103 |  |  | $ | 194,200 |  |  | $ | 263,311 |
___________________
(1) | Adjusted EBITDA refers to earnings before interest, taxes, depreciation and amortization, and further excludes integration/acquisition costs, impairment of fixed assets, impairment of right-of-use assets, and restructuring charges, net.
Financial highlights by reportable segments are as follows:
| Three Months Ended October 31,
| 2023 |  | 2022
| Fee revenue |  | Total revenue |  | Adjusted EBITDA |  | Fee revenue |  | Total revenue |  | Adjusted EBITDA
| (in thousands)
Consulting | $ | 177,795 |  |  | $ | 180,953 |  |  | $ | 28,928 |  |  | $ | 173,092 |  |  | $ | 175,845 |  |  | $ | 31,089 |
Digital | 97,092 |  |  | 97,157 |  |  | 28,983 |  |  | 94,329 |  |  | 94,577 |  |  | 27,524 |
Executive Search: |  |  |  |  |  |  |  |  |  |  |
North America | 132,512 |  |  | 133,933 |  |  | 29,436 |  |  | 142,485 |  |  | 144,147 |  |  | 37,969 |
EMEA | 43,098 |  |  | 43,315 |  |  | 5,619 |  |  | 44,645 |  |  | 44,919 |  |  | 8,081 |
Asia Pacific | 19,304 |  |  | 19,460 |  |  | 3,875 |  |  | 23,408 |  |  | 23,523 |  |  | 5,834 |
Latin America | 8,079 |  |  | 8,085 |  |  | 805 |  |  | 7,821 |  |  | 7,822 |  |  | 2,607 |
Professional Search & Interim | 138,384 |  |  | 139,455 |  |  | 25,622 |  |  | 134,743 |  |  | 135,762 |  |  | 32,457 |
RPO | 87,739 |  |  | 90,089 |  |  | 8,855 |  |  | 107,326 |  |  | 109,124 |  |  | 16,004 |
Corporate | — |  |  | — |  |  | (33,581) |  |  | — |  |  | — |  |  | (30,462) |
Consolidated | $ | 704,003 |  |  | $ | 712,447 |  |  | $ | 98,542 |  |  | $ | 727,849 |  |  | $ | 735,719 |  |  | $ | 131,103 |
| Six Months Ended October 31,
| 2023 |  | 2022
| Fee revenue |  | Total revenue |  | Adjusted EBITDA |  | Fee revenue |  | Total revenue |  | Adjusted EBITDA
| (in thousands)
Consulting | $ | 345,883 |  |  | $ | 351,746 |  |  | $ | 54,108 |  |  | $ | 339,576 |  |  | $ | 344,580 |  |  | $ | 60,639 |
Digital | 185,078 |  |  | 185,169 |  |  | 53,308 |  |  | 178,090 |  |  | 178,392 |  |  | 51,702 |
Executive Search: |  |  |  |  |  |  |  |  |  |  |
North America | 260,010 |  |  | 263,346 |  |  | 58,192 |  |  | 294,029 |  |  | 297,031 |  |  | 81,718 |
EMEA | 89,874 |  |  | 90,450 |  |  | 11,257 |  |  | 91,701 |  |  | 92,248 |  |  | 16,596 |
Asia Pacific | 43,843 |  |  | 44,070 |  |  | 10,190 |  |  | 49,789 |  |  | 49,975 |  |  | 13,185 |
Latin America | 14,500 |  |  | 14,507 |  |  | 2,546 |  |  | 15,629 |  |  | 15,631 |  |  | 5,224 |
Professional Search & Interim | 280,563 |  |  | 282,524 |  |  | 49,951 |  |  | 233,690 |  |  | 235,814 |  |  | 61,618 |
RPO | 183,441 |  |  | 186,897 |  |  | 19,326 |  |  | 221,248 |  |  | 225,196 |  |  | 33,713 |
Corporate | — |  |  | — |  |  | (64,678) |  |  | — |  |  | — |  |  | (61,084) |
Consolidated | $ | 1,403,192 |  |  | $ | 1,418,709 |  |  | $ | 194,200 |  |  | $ | 1,423,752 |  |  | $ | 1,438,867 |  |  | $ | 263,311 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 22 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-22 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-15 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 31 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-31 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 42 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-42 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 40 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-40 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//280/tableOfContent Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 26 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-26 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 34 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-34 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 41 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-41 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 + Details
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