FTI CONSULTING, INC
For the period ended Dec 31, 2025. Filed Feb 26, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 26, 2026
FCN$195.71-0.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-20.
0000887936-25-000014
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-26.
0000887936-26-000013
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 169 previous paragraphs and 170 current paragraphs.
112 unchanged; 39 reworded; 18 added; 16 removed; 2 previous and 1 current paragraphs rearranged.
Tables are not compared: 16 previous and 16 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
The Company renamed its Corporate Finance & Restructuring segment to Corporate Finance to better align with the segment’s business activities, structure and strategy, as of December 31, 2025. The segment name change did not result in any change to the composition of the segment and has no impact on previously reported financial information.
Current report
Revenues for the year ended December 31, 2025 increased $90.2 million, or 2.4%, compared to the year ended December 31, 2024, due to higher revenues in our Corporate Finance, FLC and Strategic Communications segments, which was partially offset by lower revenues in our Economic Consulting and Technology segments.
Current report
Unallocated corporate expenses decreased $19.8 million, or 13.4%, to $127.8 million compared to $147.6 million for the year ended December 31, 2024, primarily due to legal settlement gains.
Current report
Interest expense increased $14.4 million, or 207.8%, to $21.4 million for the year ended December 31, 2025 compared to $7.0 million for the year ended December 31, 2024, primarily due to higher borrowings on our senior unsecured bank revolving credit facility (“Credit Facility”).
Current report
CORPORATE FINANCE
Current report
Revenues increased $159.8 million, or 11.5%, to $1,551.0 million for the year ended December 31, 2025, primarily due to higher demand for our turnaround & restructuring and transactions services, higher realized bill rates for our transformation and transactions services and an increase in success fees, which was partially offset by lower demand for our transformation services and lower realized bill rates for our turnaround & restructuring services.
Current report
Revenues increased $74.5 million, or 10.8%, to $764.7 million for the year ended December 31, 2025, primarily due to higher realized bill rates for our risk & investigations, data & analytics and construction solutions services.
Current report
Gross profit increased $48.9 million, or 21.7%, to $274.1 million for the year ended December 31, 2025. Gross profit margin increased 3.2 percentage points from 2024 to 2025. The increase in gross profit margin was primarily due to higher realized bill rates.
Current report
SG&A expenses increased $1.4 million, or 1.0%, to $146.5 million for the year ended December 31, 2025. SG&A expenses of 19.2% of revenues in 2025 compared to 21.0% in 2024. The increase in SG&A expenses was primarily due to higher compensation and infrastructure support expenses, which was partially offset by favorable litigation settlements.
Current report
Gross profit decreased $92.8 million, or 39.5%, to $142.4 million for the year ended December 31, 2025. Gross profit margin decreased 7.5 percentage points from 2024 to 2025. The decrease in gross profit margin was primarily due to a 7 percentage point decrease in utilization and higher forgivable loan amortization expenses, which was partially offset by higher realized bill rates for our non-M&A-related antitrust and M&A-related antitrust services and lower compensation expenses, including the impact of an 8.6% decline in billable headcount.
Current report
SG&A expenses decreased $8.5 million, or 6.5%, to $122.6 million for the year ended December 31, 2025, which included a 1.3% estimated negative impact from FX. SG&A expenses of 17.0% of revenues in 2025 compared to 15.2% of revenues in 2024. The decrease in SG&A expenses was primarily driven by lower bad debt expense.
Current report
SG&A expenses decreased $8.7 million, or 8.5%, to $93.9 million for the year ended December 31, 2025. SG&A expenses of 25.1% of revenues in 2025 compared with 24.6% of revenues in 2024. The decrease in SG&A expenses was primarily due to lower compensation, travel and entertainment and outside services expenses.
Current report
Revenues increased $42.4 million, or 12.6%, to $378.5 million for the year ended December 31, 2025, which included a 1.5% estimated positive impact from FX. Excluding the estimated impact from FX, revenues increased $37.4 million, or 11.1%, primarily due to higher demand for our corporate reputation services and an $18.2 million increase in pass-through revenues.
Current report
SG&A expenses were flat over the prior year period at $76.4 million for the year ended December 31, 2025, which included a 1.7% estimated negative impact from FX. SG&A expenses were 20.2% of revenues in 2025 compared to 22.7% in 2024.
Current report
On November 21, 2025, we entered into a material lease agreement to accept possession of three leases (the “Leases”) for our new office space in London, England. We expect to accept possession of the premises on or about September 25, 2027, subject to the satisfaction of certain conditions. The Leases will have a fixed term of 15 years, subject to a break option allowing the tenant, which is a wholly-owned subsidiary of the Company, to terminate the Leases at the end of the 10th year. At the end of the initial 15-year term, the tenant has a one-time contractual right to renew each of the Leases for a term of either five years or ten years. Fixed rental payments under the Leases are scheduled to commence in February 2028, payable in quarterly installments, and will aggregate to approximately $115.0 million.
Current report
Income Taxes. As part of the process of preparing our consolidated financial statements, we estimate our income taxes for each of our legal entities in its respective jurisdiction. Differences which are temporary in nature result in deferred tax assets and liabilities. Significant judgment is required in determining our provision for income taxes, our deferred tax assets and liabilities and any valuation allowance recorded against our deferred tax assets.
Current report
Subsequent to the initial recognition of deferred tax assets, we assess the likelihood that such deferred tax assets will be realized. We weigh all available positive and negative evidence, including scheduled reversals of temporary differences, projected future taxable income, tax planning strategies and historical results of operations, and if we determine that we may not fully derive the benefit from a deferred tax asset, we consider whether it would be appropriate to apply a valuation allowance against the applicable deferred tax asset. The weight we give to any particular item is, in part, dependent upon the degree to which it can be objectively verified. Pre-tax operating losses on a three-year cumulative basis or lack of sustainable profitability are considered objectively verifiable evidence and will generally outweigh a projection of future taxable income.
Current report
Certain of our legal entities have individually experienced operating losses on a three-year cumulative basis or have tax attributes that we have determined may expire unused. In addition, some of our legal entities have recorded a valuation allowance on all or a portion of their deferred tax assets due to the combined effect of operating losses in certain subsidiaries of these entities. Based on all available evidence, we have determined that there is not available objective evidence of a greater than 50% likelihood that the deferred tax assets held by these entities will be realized. Consequently, we have recorded valuation allowances on the deferred tax assets held by these entities as of December 31, 2025. Refer to Note 16, “Income Taxes” in Part II, Item 8 of this Annual Report for further information on income taxes.
Removed paragraphs (16)
Previous report
Revenues for the year ended December 31, 2024 increased $209.4 million, or 6.0%, compared to the year ended December 31, 2023 due to increased revenues in all of our business segments.
Previous report
There were no special charges recorded during the year ended December 31, 2023.
Previous report
Q1 2025 Special Charge
Previous report
During the first quarter of 2025, we continued to implement targeted headcount reductions in areas of each segment and region where we need to realign our workforce with current business demands. The Company expects to record a special charge of approximately $17 million in the first quarter of 2025.
Previous report
Unallocated corporate expenses increased $22.2 million, or 17.7%, to $147.6 million compared to $125.4 million for the year ended December 31, 2023. The increase was primarily due to investments related to artificial intelligence (“AI”) capabilities, higher compensation expenses, largely related to headcount growth, and an increase in legal expenses.
Previous report
Interest expense decreased $7.4 million, or 51.5%, to $7.0 million in 2024 compared to $14.3 million for the year ended December 31, 2023. The decrease was primarily due to lower borrowings, which was partially offset by higher interest rates on our borrowings. Our borrowings in the prior year included amounts owed on our 2.0% convertible senior notes due 2023 (“2023 Convertible Notes”), which matured in August 2023, as well as borrowings on our senior secured bank revolving credit facility (“Credit Facility”).
Previous report
CORPORATE FINANCE & RESTRUCTURING
Previous report
Revenues increased $44.5 million, or 3.3%, to $1,391.2 million for the year ended December 31, 2024. Pass-through revenues contributed $9.7 million, or 0.7% of the increase. Excluding the pass-through revenues, the $34.9 million, or 2.7%, increase in revenues was primarily due to higher realized bill rates for our restructuring and transactions services and higher demand for our transactions services, which was partially offset by lower demand for our transformation & strategy services.
Previous report
SG&A expenses increased $9.3 million, or 4.4%, to $219.6 million for the year ended December 31, 2024. SG&A expenses of 15.8% of revenues in 2024 compared to 15.6% in 2023. The increase in SG&A expenses was primarily due to higher infrastructure support and bad debt expenses.
Previous report
Revenues increased $36.1 million, or 5.5%, to $690.2 million for the year ended December 31, 2024. Acquisition-related revenues contributed $6.8 million, or 1.0% of the increase. Excluding the acquisition-related revenues, the $29.3 million, or 4.5%, increase in revenues was primarily due to higher realized bill rates and demand for our constructions solutions services, higher realized bill rates for our disputes services and an increase in success fees.
Previous report
Gross profit increased $8.4 million, or 3.9%, to $225.2 million for the year ended December 31, 2024. Gross profit margin decreased 0.5 percentage points from 2023 to 2024. The decrease in gross profit margin was primarily due to higher compensation expenses as a percentage of revenues, which was largely offset by internal cost recovery related to an initiative to develop AI capabilities for the Company. The related costs are included in our unallocated corporate expenses.
Previous report
SG&A expenses increased $10.4 million, or 7.7%, to $145.1 million for the year ended December 31, 2024. SG&A expenses of 21.0% of revenues in 2024 compared to 20.6% in 2023. The increase in SG&A expenses was primarily driven by higher bad debt, travel and entertainment, rent, and other general and administrative expenses.
Previous report
Gross profit increased $16.5 million, or 7.5%, to $235.1 million for the year ended December 31, 2024. Gross profit margin decreased 1.1 percentage points from 2023 to 2024. The decrease in gross profit margin was primarily due to an increase in compensation and outside consultant expenses as a percentage of revenues, which was partially offset by the impact of higher realized bill rates.
Previous report
SG&A expenses increased $22.2 million, or 20.4%, to $131.0 million for the year ended December 31, 2024. SG&A expenses of 15.2% of revenues in 2024 compared to 14.1% in 2023. The increase in SG&A expenses was primarily driven by higher bad debt, largely related to one engagement, compensation and infrastructure support expenses.
Previous report
SG&A expenses increased $2.3 million, or 2.3%, to $102.6 million for the year ended December 31, 2024. SG&A expenses of 24.6% of revenues in 2024 compared to 25.9% of revenues in 2023. The increase in SG&A expenses was primarily due to higher compensation, infrastructure support and travel and entertainment expenses, which was partially offset by lower bad debt expenses.
Previous report
Revenues increased $6.8 million, or 2.1%, to $336.0 million for the year ended December 31, 2024, primarily due to higher public affairs and financial communications revenues, which was partially offset by lower corporate reputation revenues.
Reworded paragraphs (39)
Previous wording
FTI Consulting, Inc., including its consolidated subsidiaries (collectively, the “Company,” “we,” “our” or “FTI Consulting”) is a global business advisory firm dedicated to helping organizations manage change, mitigate risk and resolve disputes: financial, legal, operational, political & regulatory, reputational and transactional. Individually, each of our segments and practices is staffed with experts recognized for the depth of their knowledge and a track record of making an impact. Collectively, FTI Consulting offers a comprehensive suite of services designed to assist clients across the business cycle, from proactive risk management to rapid response to unexpected events and dynamic environments.
Current wording
FTI Consulting, Inc., including its consolidated subsidiaries (collectively, the “Company,” “we,” “our” or “FTI Consulting”) is a leading global expert firm for organizations facing crisis and transformation. Individually, each of our segments and practices is staffed with experts recognized for the depth of their knowledge and a track record of making an impact.
Previous wording
Our Corporate Finance & Restructuring (“Corporate Finance”)segment focuses on the strategic, operational, financial, transactional and capital needs of our clients around the world. Our clients include companies, boards of directors, investors, private equity sponsors, lenders, and other financing sources and creditor groups, as well as other parties-in-interest and governments. We deliver a wide range of services centered around three core offerings: Transactions, Transformation & Strategy and Turnaround & Restructuring.
Current wording
Our Corporate Finance segment focuses on the strategic, operational, financial, transactional and capital needs of our clients around the world. Our clients include companies, boards of directors, investors, private equity sponsors, lenders, and other financing sources and creditor groups, governments and other interested parties. We deliver a wide range of services centered around three core offerings: Transactions, Transformation and Turnaround & Restructuring.
Previous wording
Our Forensic and Litigation Consulting (“FLC”) segment provides law firms, companies, boards of directors, government entities, private equity firms and other interested parties with a multidisciplinary and independent range of services across risk & investigations and disputes, supported by our data & analytics technology-enabled solutions, with a focus on highly regulated industries. Our services are centered around five core offerings: Construction, Projects & Assets and Environmental Solutions, Data & Analytics, Disputes, Healthcare Risk Management & Advisory and Risk and Investigations.
Current wording
Our Forensic and Litigation Consulting (“FLC”) segment provides law firms, companies, boards of directors, government entities, private equity firms and other interested parties with a multidisciplinary and independent range of services across risk & investigations and disputes, supported by our data & analytics technology-enabled solutions, with a focus on highly regulated industries. Our services are centered around five core offerings: Construction, Projects & Assets and Environmental Solutions, Data & Analytics, Dispute Advisory Services, Healthcare Risk Management & Advisory and Risk & Investigations, which includes our cybersecurity and financial services-related offerings.
Previous wording
Our Technology segment provides companies, law firms, private equity firms and government entities with a comprehensive global portfolio of digital insights and risk management consulting and data services. Our professionals help organizations better address risk as the growing volume and variety of enterprise and emerging data intersects with legal, regulatory and compliance needs. We deliver a wide range of expert and analytics-powered solutions driven by investigations, litigation, antitrust and competition, M&A, restructuring and compliance and risk through three core offerings: Corporate Legal Department Consulting, E-discovery and Analytics Services and Expertise, and Information Governance, Privacy & Security Services.
Current wording
Our Technology segment provides companies, law firms, private equity firms and government entities with a comprehensive global portfolio of digital insights and risk management, artificial intelligence (“AI”) and data services. Our professionals help organizations better address risk as the growing volume and variety of enterprise and emerging data intersects with legal, regulatory and compliance needs. We deliver a wide range of expert and AI-powered solutions driven by five core client needs: Blockchain & Digital Assets, Information Governance, Privacy & Security, Investigations, Litigation, and M&A, Antitrust and Competition.
Previous wording
Our Strategic Communications segment develops and executes communications strategies to help management teams, boards of directors, law firms, governments and regulators manage change and mitigate risk surrounding transformational and disruptive events, including transactions, investigations, disputes, crises, regulation and legislation. We deliver a wide range of services centered around three core offerings: Corporate Reputation, Financial Communications and Public Affairs.
Current wording
Our Strategic Communications segment develops and executes communications strategies to help management teams, boards of directors, law firms, governments and regulators manage change and mitigate risk surrounding transformational and disruptive events, including crises, transactions, investigations, disputes, regulation and legislation. We deliver a wide range of services centered around three core offerings: Corporate Reputation, Financial Communications and Public Affairs.
Previous wording
We derive substantially all of our revenues from providing professional services to both U.S. and international clients. Most of our services are rendered under time and expense contract arrangements, which require the client to pay us based on the number of hours worked at contractually agreed-upon rates. Under this arrangement, we typically bill our clients for reimbursable expenses, including those relating to travel, out-of-pocket expenses, outside consultants and other outside service costs. Certain contracts are rendered under fixed-fee arrangements, which require the client to pay a fixed-fee in exchange for a predetermined set of professional services. Fixed-fee arrangements may require certain clients to pay us a recurring retainer.
Current wording
We derive substantially all of our revenues from providing professional services to both U.S. and international clients. Most of our services are rendered under time and expense contract arrangements, which require the client to pay us based on the number of hours worked at contractually agreed-upon rates. Under this arrangement, we typically bill our clients for reimbursable expenses, including those relating to travel, out-of-pocket expenses, outside consultants and other outside service costs. Certain contracts are rendered under fixed-fee arrangements, which require the client to pay a fixed-fee in exchange for a predetermined set of professional services. Fixed-fee arrangements may require certain clients to pay us a recurring retainer. Our contract arrangements may also contain success fees or performance-based arrangements in which our fees are based on the attainment of contractually defined objectives with our client. This type of success fee may supplement a time and expense or fixed-fee arrangement. Success fees and other contractual terms may cause variations in our revenues and operating results due to the timing of when achieving the performance-based criteria becomes probable. Seasonal factors, such as the timing of our employees’ and clients’ vacations and holidays, may impact the timing of our revenue recognition across our segments.
Previous wording
We define Segment Operating Income as a segment’s share of consolidated operating income. We define Total Segment Operating Income, which is a non-GAAP financial measure, as the total of Segment Operating Income for all segments, which excludes unallocated corporate expenses. We use Segment Operating Income for the purpose of calculating Adjusted Segment EBITDA, which is a non-GAAP financial measure. We define Adjusted Segment EBITDA as a segment’s share of consolidated operating income before depreciation, amortization of intangible assets, remeasurement of acquisition-related contingent consideration, special charges and goodwill impairment charges. We use Adjusted Segment EBITDA as a basis to internally evaluate the financial performance of our segments because we believe it reflects core operating performance and provides an indicator of the segment’s ability to generate cash. We define Total Adjusted Segment EBITDA, which is a non-GAAP financial measure, as the total of Adjusted Segment EBITDA for all segments, which excludes unallocated corporate expenses.
Current wording
We define Segment Operating Income as a segment’s share of consolidated operating income. We define Total Segment Operating Income, which is a non-GAAP financial measure, as the total of Segment Operating Income for all segments, which excludes unallocated corporate expenses. We use Segment Operating Income for the purpose of calculating Adjusted Segment EBITDA, which is a non-GAAP financial measure. We define Adjusted Segment EBITDA as Segment Operating Income before depreciation, amortization of intangible assets, remeasurement of acquisition-related contingent consideration, special charges and goodwill impairment charges. We use Adjusted Segment EBITDA as a basis to internally evaluate the financial performance of our segments because we believe it reflects core operating performance and provides an indicator of the segment’s ability to generate cash. We define Total Adjusted Segment EBITDA, which is a non-GAAP financial measure, as the total of Adjusted Segment EBITDA for all segments, which excludes unallocated corporate expenses.
Previous wording
(1)Excluded from non-GAAP financial measures
Current wording
(1)Excluded from non-GAAP financial measures, including Adjusted EBITDA and Adjusted EPS.
Previous wording
During the year ended December 31, 2024, we recorded special charges of $8.2 million. The charges related to targeted headcount reductions in areas of each segment and region where we realigned our workforce with current business demand for our consulting services. A portion of the special charges was paid during the year ended December 31, 2024 and the remaining amounts will be paid in cash in the next 12 months.
Current wording
During the year ended December 31, 2025, we recorded special charges of $25.3 million. The charges related to targeted headcount reductions in areas of each segment and region where we realigned our workforce with current business demand for our consulting services. The majority of the special charges were paid during the year ended December 31, 2025 and the remaining amounts will be paid in cash in the next three months.
Previous wording
Net income for the year ended December 31, 2024 increased $5.2 million, or 1.9%, compared to the year ended December 31, 2023. The increase in net income was primarily due to higher revenues, lower income taxes and an FX gain compared to an FX loss in the prior year. This increase was partially offset by higher direct compensation expenses, which includes the impact of a 4.5% increase in billable headcount, higher selling, general and administrative (“SG&A”) expenses, which includes the impact of a 6.2% increase in non-billable headcount, and an increase in bad debt and outside services expenses.
Current wording
Net income for the year ended December 31, 2025 decreased $9.2 million, or 3.3%, compared to the year ended December 31, 2024. The decrease in net income was primarily due to higher direct costs, which includes the impact of an increase in variable compensation and forgivable loan amortization, as well as higher income taxes, special charges and interest expense. The decrease was partially offset by higher revenues and lower selling, general and administrative (“SG&A”) expenses, which include legal settlement gains.
Previous wording
Adjusted EBITDA for the year ended December 31, 2024 decreased $21.1 million, or 5.0%, compared to the year ended December 31, 2023. Adjusted EBITDA Margin of 10.9% of revenues for the year ended December 31, 2024 compared to 12.2% of revenues for the year ended December 31, 2023. The decrease in Adjusted EBITDA was primarily due to an increase in direct compensation expenses, which includes the impact of a 4.5% increase in billable headcount, higher SG&A expenses, which includes the impact of a 6.2% increase in non-billable headcount, and an increase in bad debt and outside services expenses, which was partially offset by higher revenues. Adjusted EBITDA for the year ended December 31, 2024 excludes the $8.2 million special charge.
Current wording
Adjusted EBITDA for the year ended December 31, 2025 increased $59.9 million, or 14.8%, compared to the year ended December 31, 2024. Adjusted EBITDA Margin of 12.2% of revenues for the year ended December 31, 2025 compared to 10.9% of revenues for the year ended December 31, 2024. The increase in Adjusted EBITDA was primarily due to higher revenues and lower SG&A expenses, which include legal settlement gains. The increase was partially offset by higher direct costs, which includes the impact of higher variable compensation and forgivable loan amortization. Adjusted EBITDA for the years ended December 31, 2025 and 2024 excludes the $25.3 million and $8.2 million special charges, respectively.
Previous wording
EPS for the year ended December 31, 2024 increased $0.10 to $7.81 compared to $7.71 for the year ended December 31, 2023. The increase in EPS was primarily due to the higher net income described above.
Current wording
EPS for the year ended December 31, 2025 increased $0.43 to $8.24 compared to $7.81 for the year ended December 31, 2024. The increase in EPS was primarily due to lower weighted average shares outstanding, which was partially offset by a decrease in net income, as described above.
Previous wording
Adjusted EPS for the year ended December 31, 2024 increased $0.28 to $7.99 compared to $7.71 for the year ended December 31, 2023. Adjusted EPS for the year ended December 31, 2024 excludes the $8.2 million special charge, which increased Adjusted EPS by $0.18.
Current wording
Adjusted EPS for the year ended December 31, 2025 increased $0.84 to $8.83 compared to $7.99 for the year ended December 31, 2024. Adjusted EPS for the years ended December 31, 2025 and 2024 excludes the $25.3 million and $8.2 million special charges, which increased Adjusted EPS by $0.59 and $0.18, respectively.
Previous wording
Net cash provided by operating activities for the year ended December 31, 2024 increased $170.6 million to $395.1 million compared to $224.5 million for the year ended December 31, 2023. The increase in net cash provided by operating activities was primarily due to an increase in cash collections, which was partially offset by higher compensation, forgivable loan issuances, operating expenses and income tax payments as compared to the same period in the prior year. Days sales outstanding (“DSO”) was 97 days at December 31, 2024 and 100 days at December 31, 2023. The decrease in DSO was primarily due to cash collections that outpaced the increase in revenues.
Current wording
Net cash provided by operating activities for the year ended December 31, 2025 decreased $243.0 million to $152.1 million compared to $395.1 million for the year ended December 31, 2024. The decrease in net cash provided by operating activities was primarily due to higher forgivable loan issuances, compensation and income tax payments, which was partially offset by an increase in cash collections. Days sales outstanding (“DSO”) was 88 days at December 31, 2025 and 97 days at December 31, 2024.
Previous wording
Free Cash Flow was $360.2 million and $174.9 million for the years ended December 31, 2024 and 2023, respectively. The increase in Free Cash Flow for the year ended December 31, 2024 was primarily due to higher net cash provided by operating activities, as described above, and a decrease in net cash used for purchases of property and equipment.
Current wording
Free Cash Flow was an inflow of $93.6 million and $360.2 million for the years ended December 31, 2025 and 2024, respectively. The decrease in Free Cash Flow was primarily due to lower net cash provided by operating activities, as described above, and higher net cash used for purchases of property and equipment.
Previous wording
A portion of net cash provided by operating activities was used to repurchase and retire 51,717 shares of our common stock under our Repurchase Program for an average price per share of $197.53, at a total cost of $10.2 million during the year ended December 31, 2024. We had $450.4 million remaining under the Repurchase Program to repurchase additional shares as of December 31, 2024.
Current wording
A portion of net cash provided by operating activities was used to repurchase and retire 5,264,916 shares of our common stock under our Repurchase Program for an average price per share of $163.07, at a total cost of $858.6 million, excluding commissions, during the year ended December 31, 2025. We had $491.8 million remaining under the Repurchase Program to repurchase additional shares as of December 31, 2025.
Previous wording
The following table includes the net headcount additions by segment and in total for the year ended December 31, 2024. The net additions include targeted reductions in areas of each segment described in the “Special Charges” section above:
Current wording
The following table includes the net headcount additions (reductions) by segment and in total for the year ended December 31, 2025:
Previous wording
Interest income and other, which includes FX gains and losses, increased $15.2 million to a gain of $10.4 million for the year ended December 31, 2024, compared to a loss of $4.9 million for the year ended December 31, 2023. The increase was primarily due to a $0.5 million net FX gain for the year ended December 31, 2024 compared to a $9.3 million net FX loss for the year ended December 31, 2023 and a $3.3 million increase in interest income.
Current wording
Interest income and other, which includes FX gains and losses, decreased $7.0 million, or 67.9%, to a gain of $3.3 million for the year ended December 31, 2025, compared to a gain of $10.4 million for the year ended December 31, 2024. The decrease was primarily due to a $4.3 million net FX loss for the year ended December 31, 2025 compared to a $0.5 million net FX gain for the year ended December 31, 2024, as well as a $1.4 million decrease in interest income.
Previous wording
Our income tax provision decreased $12.8 million, or 15.3%, to $70.7 million in 2024 compared to $83.5 million for the year ended December 31, 2023. Our effective tax rate of 20.2% for 2024 compared to 23.3% for 2023. The decrease in the income tax provision was primarily due to a more favorable tax benefit related to share-based compensation, as a larger number of non-qualified stock options were exercised during the year ended December 31, 2024 as compared to the prior year.
Current wording
Our income tax provision increased $29.5 million, or 41.7%, to $100.1 million for the year ended December 31, 2025 compared to $70.7 million for the year ended December 31, 2024. Our effective tax rate of 27.0% in 2025 compared to 20.2% in 2024. The increase in the income tax provision was primarily due to a less favorable tax benefit related to share-based compensation, resulting from fewer non-qualified stock option exercises and an increase in valuation allowances against certain foreign deferred tax assets as compared to the prior year.
Previous wording
We evaluate the performance of each of our operating segments based on multiple measures of segment profit, including Adjusted Segment EBITDA, which is a non-GAAP financial measure. The following table reconciles Segment Operating Income to Adjusted Segment EBITDA for the years ended December 31, 2024 and 2023:
Current wording
We evaluate the performance of each of our operating segments based on multiple measures of segment profit, including Adjusted Segment EBITDA, which is a non-GAAP financial measure. The following tables reconcile Segment Operating Income to Adjusted Segment EBITDA for the years ended December 31, 2025 and 2024:
Previous wording
(1)The number of billable professionals for the Technology segment excludes as-needed professionals, who we employ based on demand for the segment’s services. We employed an average of 776 and 670 as-needed employees during the years ended December 31, 2024 and 2023, respectively.
Current wording
(1)The number of billable professionals for the Technology segment excludes as-needed professionals, who we employ based on demand for the segment’s services. We employed an average of 602 and 776 as-needed employees during the years ended December 31, 2025 and 2024, respectively.
Previous wording
Gross profit increased $21.8 million, or 5.0%, to $453.8 million for the year ended December 31, 2024. Gross profit margin increased 0.5 percentage points from 2023 to 2024. The increase in gross profit margin was primarily due to the impact of higher realized bill rates, which was partially offset by a 2 percentage point decline in utilization.
Current wording
Gross profit increased $83.4 million, or 18.4%, to $537.1 million for the year ended December 31, 2025. Gross profit margin increased 2.0 percentage points from 2024 to 2025. The increase in gross profit margin was primarily due to a 2 percentage point increase in utilization and the impact of higher realized bill rates.
Previous wording
SG&A expenses increased $4.8 million, or 6.7%, to $76.4 million for the year ended December 31, 2024. SG&A expenses of 22.7% of revenues in 2024 compared to 21.8% in 2023. The increase in SG&A expenses was primarily due to higher rent, compensation, marketing, and other general and administrative expenses.
Current wording
SG&A expenses increased $14.7 million, or 6.7%, to $234.4 million for the year ended December 31, 2025. SG&A expenses of 15.1% of revenues in 2025 compared to 15.8% in 2024. The increase in SG&A expenses was primarily due to higher bad debt, outside services, infrastructure support, and other general and administrative expenses.
Previous wording
Revenues increased $92.2 million, or 12.0%, to $863.6 million for the year ended December 31, 2024, primarily due to higher demand and realized bill rates for our M&A-related antitrust and financial economics services and higher realized bill rates for our non-M&A-related antitrust services, which was partially offset by lower demand for our non-M&A-related antitrust services.
Current wording
Revenues decreased $142.7 million, or 16.5%, to $720.8 million for the year ended December 31, 2025, which included a 1.2% estimated positive impact from FX. Excluding the estimated impact from FX, revenues decreased $153.5 million, or 17.8%. The decrease in revenues was primarily due to lower demand for our M&A-related antitrust and non-M&A-related antitrust services, which was partially offset by higher demand for our financial economics services, as well as higher realized bill rates for our non-M&A-related antitrust and M&A-related antitrust services.
Previous wording
Revenues increased $29.8 million, or 7.7%, to $417.6 million for the year ended December 31, 2024, primarily due to higher demand for our M&A-related “second request” and information governance, privacy & security services, which was partially offset by lower demand for our investigations services.
Current wording
Revenues decreased $43.8 million, or 10.5%, to $373.9 million for the year ended December 31, 2025, primarily due to lower demand for our M&A-related “second request” services.
Previous wording
Gross profit decreased $3.4 million, or 2.3%, to $145.1 million for the year ended December 31, 2024. Gross profit margin decreased 3.5 percentage points from 2023 to 2024. The decrease in gross profit margin was primarily due to lower profitability of our consulting and hosting services.
Current wording
Gross profit decreased $21.2 million, or 14.6%, to $123.9 million for the year ended December 31, 2025. Gross profit margin decreased 1.6 percentage points from 2024 to 2025. The decrease in gross profit margin was primarily due to lower profitability of our processing, hosting and managed review services, primarily resulting from the decline in revenues from our M&A-related “second request” services, which was partially offset by an increase in profitability of our consulting services.
Previous wording
Gross profit increased $3.7 million, or 3.1%, to $122.7 million for the year ended December 31, 2024. Gross profit margin increased 0.4 percentage points from 2023 to 2024. The increase in gross profit margin was primarily due to lower compensation expenses as a percentage of revenues.
Current wording
Gross profit increased $17.3 million, or 14.1%, to $140.0 million for the year ended December 31, 2025. Gross profit margin increased 0.5 percentage points from 2024 to 2025. The increase in gross profit margin was primarily due to lower compensation expenses as a percentage of revenues, which included a 7.5% decline in billable headcount. This increase was partially offset by higher pass-through revenues and expenses.
Previous wording
Results of operations for our non-U.S. subsidiaries are translated from the designated functional currency to our reporting currency of USD. Revenues and expenses are translated at average exchange rates for each month, while assets and liabilities are translated at balance sheet date exchange rates. Resulting net translation adjustments are recorded as a component of stockholders’ equity in “Accumulated other comprehensive loss.”
Current wording
Results of operations for our non-U.S. subsidiaries are translated from the designated functional currency to our reporting currency of USD. Revenues and expenses are translated at average exchange rates for each month, while assets and liabilities are translated at balance sheet date exchange rates and certain equity transactions are translated at historical rates. Resulting net translation adjustments are recorded as a component of stockholders’ equity in “Accumulated other comprehensive loss.”
Previous wording
Net cash provided by operating activities increased $170.6 million, or 76.0%, to $395.1 million compared to $224.5 million for the year ended December 31, 2023. The increase was primarily due to an increase in cash collections, which was partially offset by higher compensation, forgivable loan issuances to retain key professionals, operating expenses and income tax payments as compared to the prior year. DSO was 97 days as of December 31, 2024 and 100 days as of December 31, 2023. The decrease in DSO was primarily due to cash collections that outpaced the increase in revenues.
Current wording
Net cash provided by operating activities decreased $243.0 million to $152.1 million compared to $395.1 million for the year ended December 31, 2024. The decrease in net cash provided by operating activities was primarily due to higher forgivable loan issuances, compensation payments and income tax payments, which was partially offset by an increase in cash collections. DSO was 88 and 97 days as of December 31, 2025 and 2024, respectively.
Previous wording
Net cash used in investing activities decreased $63.7 million, or 86.2%, to $10.2 million compared to $73.8 million for the year ended December 31, 2023. The decrease was primarily due to a $24.4 million payment for a short-term investment during 2023 and the maturity of the short-term investment of $25.2 million during 2024. In addition, there was a $14.1 million decrease in capital expenditures primarily driven by lower spend on cloud computing costs and leasehold improvements as compared to the prior year.
Current wording
Net cash used in investing activities increased $48.4 million to $58.5 million compared to $10.2 million for the year ended December 31, 2024. The increase in net cash used in investing activities was due to a $23.1 million increase in capital expenditures, primarily related to higher spend on leasehold improvements as compared to the year ended December 31, 2024, as well as the prior year maturity of a short-term investment of $25.2 million, which created an inflow in the comparative prior year period.
Previous wording
Net cash used in financing activities decreased $339.3 million, or 95.7%, to $15.4 million compared to $354.7 million for the year ended December 31, 2023. The decrease was primarily due to the repayment of the $315.8 million principal amount of our 2023 Convertible Notes at maturity during 2023, a decrease of $10.8 million in payments for common stock repurchases under the Repurchase Program and an increase in proceeds on stock option exercises of $9.6 million as compared to the prior year.
Current wording
Net cash used in financing activities increased $495.1 million to $510.5 million compared to $15.4 million for the year ended December 31, 2024. The increase in net cash used in financing activities was primarily due to an increase of $848.5 million in payments for common stock repurchases under the Repurchase Program, which was partially offset by an increase in net borrowings of $365.0 million under our Credit Facility compared to the year ended December 31, 2024.
Previous wording
The effect of exchange rate changes on cash and cash equivalents had an unfavorable impact of $12.3 million for 2024 compared to a favorable impact of $15.6 million for 2023.
Current wording
The effect of exchange rate changes on cash and cash equivalents had a favorable impact of $21.5 million for the year ended December 31, 2025 compared to an unfavorable impact of $12.3 million for the year ended December 31, 2024.
Previous wording
For the year ended December 31, 2024, cash paid for income taxes and tax credits, net of refunds included $40.6 million of payments for the purchase of tax credits.
Current wording
Cash paid for income taxes and tax credits, net of tax refunds, included $28.9 million and $40.6 million of payments for the purchase of tax credits during the years ended December 31, 2025 and 2024, respectively.
Previous wording
As of December 31, 2024, our capital resources included $660.5 million of cash and cash equivalents and available borrowing capacity of $900.0 million under the revolving line of credit under our Credit Facility. The $900.0 million revolving line of credit under our Credit Facility includes a $125.0 million sublimit for borrowings in currencies other than USD, including the euro, British pound, Australian dollar, Canadian dollar, Swiss franc and Japanese yen.
Current wording
As of December 31, 2025, our capital resources included $265.1 million of cash and cash equivalents and available borrowing capacity of $535.0 million under the revolving line of credit under our Credit Facility. The $900.0 million revolving line of credit under our Credit Facility includes a $125.0 million sublimit for borrowings in currencies other than USD, including the euro, British pound, Australian dollar, Canadian dollar, Swiss franc and Japanese yen.
Previous wording
enter into transactions with affiliates or related persons; or engage in any business other than consulting-related businesses. In addition, the Credit Agreement includes a financial covenant that requires us not to exceed a maximum consolidated total net leverage ratio (the ratio of funded debt (less unrestricted cash up to $300.0 million) to Consolidated EBITDA, as defined in the Credit Agreement). As of December 31, 2024, we were in compliance with the covenants contained in the Credit Agreement. See Note 14, “Debt” in Part II, Item 8 of this Annual Report for a further discussion of the Credit Agreement.
Current wording
The second amended and restated credit agreement entered into on November 21, 2022 (the “Credit Agreement”) governing the Credit Facility and our other indebtedness outstanding from time to time contains covenants that, among other things, may limit our ability to: incur additional indebtedness; create liens; pay dividends on our capital stock, make distributions or repurchases of our capital stock or make specified other restricted payments; consolidate, merge or sell all or substantially all of our assets; guarantee obligations of other entities or our foreign subsidiaries; enter into hedging agreements; enter into transactions with affiliates or related persons; or engage in any business other than consulting-related businesses. In addition, the Credit Agreement includes a financial covenant that requires us not to exceed a maximum consolidated total net leverage ratio (the ratio of funded debt (less unrestricted cash up to $300.0 million) to Consolidated EBITDA, as defined in the Credit Agreement). As of December 31, 2025, we were in compliance with the covenants contained in the Credit Agreement. See Note 13, “Debt” in Part II, Item 8 of this Annual Report for a further discussion of the Credit Agreement.
Previous wording
During 2024, we spent $34.9 million in capital expenditures to support our organization, including direct support for specific client engagements. During 2025, we currently expect to make capital expenditures to support our organization in an aggregate amount of between $70 million and $86 million, which includes costs related to leasehold improvements for our new office space in Chicago, Illinois, cloud computing costs and investments related to AI capabilities. Our estimate takes into consideration the needs of our existing businesses but does not include the impact of any purchases that we may be required to make as a result of future acquisitions or specific client engagements that are not completed or not currently contemplated. Our capital expenditure requirements may change if our staffing levels or technology needs change significantly from what we currently anticipate, if we are required to purchase additional equipment specifically to support new client engagements or if we pursue and complete acquisitions.
Current wording
During 2025, we spent $58.5 million in capital expenditures to support our organization. During 2026, we currently expect to make capital expenditures to support our organization in an aggregate amount of between $48 million and $58 million. Our estimate takes into consideration the needs of our existing businesses but does not include the impact of any expenditures that we may be required to make as a result of future acquisitions or specific client engagements that are not completed or not currently contemplated. Our capital expenditure requirements may change if our staffing levels or technology needs change significantly from what we currently anticipate, if we are required to purchase additional equipment specifically to support new client engagements or if we pursue and complete acquisitions.
Previous wording
During the year ended December 31, 2024, we made $10.2 million in payments for common stock repurchases under the Repurchase Program. We had $450.4 million remaining under the Repurchase Program to repurchase additional shares as of December 31, 2024.
Current wording
During the year ended December 31, 2025, we made $858.7 million in payments, including commissions, for common stock repurchases under the Repurchase Program. We had $491.8 million remaining under the Repurchase Program to repurchase additional shares as of December 31, 2025.
Previous wording
We have no future contractual obligations as of December 31, 2024 related to outstanding borrowings under our Credit Facility. For more information on our Credit Facility, refer to Note 14, “Debt” in Part II, Item 8 of this Annual Report. Under our operating leases as described in Note 15, “Leases” in Part II, Item 8 of this Annual Report, we have current obligations of $34.1 million and non-current obligations of $208.0 million.
Current wording
Our future contractual obligations as of December 31, 2025 include long-term obligations of $365.0 million related to outstanding borrowings under our Credit Facility. For more information on our Credit Facility, refer to Note 13, “Debt” in Part II, Item 8 of this Annual Report. Under our operating leases as described in Note 14, “Leases” in Part II, Item 8 of this Annual Report, we have current obligations of $37.2 million and non-current obligations of $224.5 million as of December 31, 2025.
Previous wording
As of December 31, 2024 and 2023, the Company was contingently liable under bank guarantees issued by our banks in favor of third parties that totaled $10.9 million and $7.8 million, respectively. These bank guarantees primarily support bid and performance obligations and operating leases for office space. The amounts are guaranteed under guarantee facilities totaling $42.7 million and $36.2 million at December 31, 2024 and 2023, respectively. The Company had $31.8 million and $28.4 million available under the facilities at December 31, 2024 and 2023, respectively. These bank guarantees are issued separate from our Credit Facility and, as a result, do not affect available borrowings under our Credit Facility.
Current wording
As of December 31, 2025 and 2024, we were contingently liable under bank guarantees issued in favor of third parties that totaled $17.5 million and $10.9 million, respectively. These bank guarantees primarily support bid and performance obligations and operating leases for office space. The amounts are guaranteed under guarantee facilities totaling $32.5 million and $42.7 million as of December 31, 2025 and 2024, respectively. We had $15.0 million and $31.8 million available under the guarantee facilities as of December 31, 2025 and 2024, respectively. These bank guarantees are issued separately from our Credit Facility and, as a result, do not affect available borrowing capacity under our Credit Facility.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
During the year ended December 31, 2024, we recorded special charges of $8.2 million. The charges related to targeted headcount reductions in areas of each segment and region where we realigned our workforce with current business demand for our consulting services.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Our contract arrangements may also contain success fees or performance-based arrangements in which our fees are based on the attainment of contractually defined objectives with our client. This type of success fee may supplement a time and expense or fixed-fee arrangement. Success fees and other contractual terms may cause variations in our revenues and operating results due to the timing of when achieving the performance-based criteria becomes probable. Seasonal factors, such as the timing of our employees’ and clients’ vacations and holidays, may impact the timing of our revenues across our segments.
Previous report — wording carried elsewhere
The second amended and restated credit agreement entered into on November 21, 2022 (the “Credit Agreement”) governing the Credit Facility and our other indebtedness outstanding from time to time contains covenants that, among other things, may limit our ability to: incur additional indebtedness; create liens; pay dividends on our capital stock, make distributions or repurchases of our capital stock or make specified other restricted payments; consolidate, merge or sell all or substantially all of our assets; guarantee obligations of other entities or our foreign subsidiaries; enter into hedging agreements;