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Q2 Revenue Exceeds High End of Outlook
All Business Segments Contribute to Consolidated Revenue Growth
Second Quarter 2025 Financial Highlights:
CHICAGO, Aug. 4, 2025 /PRNewswire/ -- Heidrick & Struggles International, Inc. (Nasdaq: HSII) ("Heidrick & Struggles", "Heidrick" or the "Company"), a premier provider of global leadership advisory and on-demand talent solutions, today announced financial results for its second quarter ended June 30, 2025.
"We had a strong first half in 2025 highlighted by second quarter results that exceeded the high end of our outlook," said Tom Monahan, CEO of Heidrick & Struggles. "While the macroeconomic environment remains uncertain, our teams are focused on staying close to clients, helping them navigate complexity, and maintaining our position as the most trusted advisor to the C-Suite.
As we enter the second half of the year, we remain laser focused on growing differentiated, deep and durable client relationships by meeting evolving client needs. We have proven that by focusing on what we can control — investing in and growing our bench of world-class professionals to deliver exceptional impact for our clients — we can create value for our shareholders."
Selected Consolidated Results | ||
(Dollars in millions, except per share amounts, and average revenue per executive search in thousands) | ||
Three Months Ended June 30, | ||
2025 | 2024 | |
Revenue before reimbursements (net revenue) | $ 317.2 | $ 278.6 |
Adjusted results (a): | ||
Adjusted EBITDA | $ 33.9 | $ 28.8 |
Adjusted EBITDA margin | 10.7 % | 10.3 % |
Adjusted net income | $ 18.1 | $ 14.1 |
Adjusted diluted earnings per share | $ 0.85 | $ 0.67 |
Selected Executive Search Data | ||
Revenue before reimbursements (net revenue) | $ 238.2 | $ 210.0 |
Ending number of consultants | 420 | 415 |
Annualized consultant productivity | $ 2.3 | $ 2.0 |
Average revenue per executive search | $ 162 | $ 151 |
Confirmations (% increase/decrease) | 5.2 % | (1.6) % |
Selected On-Demand Talent Data | ||
Revenue before reimbursements (net revenue) | $ 47.9 | $ 41.9 |
Selected Heidrick Consulting Data | ||
Revenue before reimbursements (net revenue) | $ 31.2 | $ 26.8 |
Ending number of consultants | 90 | 85 |
(a) Non-GAAP financial measures. See Non-GAAP Financial Measures, Reconciliations of Net Income (Loss) and | ||
2025 Second Quarter Results
Consolidated net revenue increased, 13.9%, or $38.6 million, to $317.2 million in the 2025 second quarter compared to consolidated net revenue of $278.6 million in the 2024 second quarter (up 12.4%, or $34.5 million on a constant currency basis). The revenue increase was driven by year-over-year growth in each of the Company's lines of business — Executive Search, On-Demand Talent, and Heidrick Consulting.
2025 second quarter net income was $21.1 million and diluted earnings per share was $0.99 which included acquisition-related earnout and contingent compensation fair value adjustments of $4.4 million related to the On-Demand Talent and Heidrick Consulting segments. Excluding these adjustments, 2025 second quarter adjusted net income was $18.1 million compared to adjusted net income of $14.1 million in the 2024 second quarter, reflecting goodwill impairment, restructuring charges and earnout and contingent compensation fair value adjustments. 2025 second quarter adjusted diluted earnings per share was $0.85 compared to $0.67 in the 2024 second quarter.
Adjusted EBITDA increased $5.0 million to $33.9 million in the 2025 second quarter compared to $28.8 million in the 2024 second quarter, and 2025 second quarter adjusted EBITDA margin expanded 40 basis points to 10.7% compared to 10.3% in the 2024 second quarter.
Executive Search net revenue was $238.2 million in the 2025 second quarter compared to net revenue of $210.0 million in the 2024 second quarter, an increase of $28.2 million, or 13.4% (up $26.1 million, or 12.4% on a constant currency basis). The higher revenue versus the year-ago period was driven by increases in all regions including 8.9% in the Americas (up 9.3% on a constant currency basis), 30.9% in Europe (up 24.1% on a constant currency basis), and 12.0% in Asia Pacific (up 11.8% on a constant currency basis) when compared to the 2024 second quarter.
Adjusted EBITDA increased $1.9 million to $54.6 million in the 2025 second quarter compared to $52.7 million in the 2024 second quarter, and 2025 second quarter adjusted EBITDA margin was 22.9% compared to 25.1% in the 2024 second quarter.
On-Demand Talent net revenue increased $6.0 million, or 14.3%, to $47.9 million in the 2025 second quarter compared to net revenue of $41.9 million in the 2024 second quarter (up $4.7 million, or 11.3% on a constant currency basis).
Adjusted EBITDA was $1.0 million in the 2025 second quarter compared to a loss of $1.6 million in the 2024 second quarter, and Adjusted EBITDA margin was 2.1% compared to (3.9)% in the 2024 second quarter.
Heidrick Consulting net revenue increased $4.4 million, or 16.6%, to $31.2 million in the 2025 second quarter compared to net revenue of $26.8 million in the 2024 second quarter (up $3.7 million, or 13.8% on a constant currency basis).
Adjusted EBITDA was $0.6 million in the 2025 second quarter compared to a loss of $1.4 million in the 2024 second quarter, and Adjusted EBITDA margin grew to 1.8% compared to (5.2)% in the 2024 second quarter.
Dividend
The Board of Directors declared a 2025 third quarter cash dividend of $0.15 per share payable on August 28, 2025, to shareholders of record at the close of business on August 14, 2025.
2025 Third Quarter Outlook
The Company expects 2025 third quarter consolidated net revenue between $295 million and $315 million, which may be impacted by external factors, such as the foreign exchange and interest rate environments, foreign conflicts, inflation and macroeconomic constraints on pricing actions. In addition, this outlook is based on the average currency rates in June 2025 and reflects, among other factors, management's assumptions for the anticipated volume of new Executive Search confirmations, On-Demand Talent projects, and Heidrick Consulting assignments, consultant productivity, and consultant retention along with the current backlog.
Quarterly Webcast and Conference Call
Heidrick & Struggles will host a conference call to review its second quarter results today, August 4, 2025, at 5:00 pm Eastern Time. Participants may access the Company's call and supporting slides through its website at www.heidrick.com or by dialing (800) 715 9871 or 646 307-1963, conference ID #4805686. For those unable to participate on the live call, a webcast and copy of the slides will be archived at www.heidrick.com and available for up to 30 days following the investor call.
About Heidrick & Struggles International, Inc.
Heidrick & Struggles (Nasdaq: HSII) is the world's foremost advisor on executive leadership, driving superior client performance through premier human capital leadership advisory services. For more than 70 years, we've delivered value for our clients by leveraging unrivaled expertise to help organizations discover and enable outstanding leaders and teams. Learn more at www.heidrick.com.
Non-GAAP Financial Measures
To supplement the financial results presented in accordance with generally accepted accounting principles in the United States ("GAAP"), Heidrick & Struggles presents certain non-GAAP financial measures. A "non-GAAP financial measure" is defined as a numerical measure of a company's financial performance that excludes or includes amounts different than the most directly comparable measure calculated and presented in accordance with GAAP in the statements of comprehensive income, balance sheets or statements of cash flow of the Company.
Non-GAAP financial measures used within this earnings release are adjusted net income, adjusted diluted earnings per share, adjusted EBITDA, and adjusted EBITDA margin, excluding the impact of exchange rate fluctuations (referred to as constant currency). These measures are presented because management uses this information to monitor and evaluate financial results and allocate resources. Management believes this information is also useful for investors to evaluate the comparability of financial information presented. Reconciliations of these non-GAAP financial measures to the most directly comparable measures calculated and presented in accordance with GAAP are provided as schedules attached to this release.
Adjusted net income and adjusted diluted earnings per share are net income and diluted earnings per share excluding goodwill impairment, restructuring charges and earnout and acquisition contingent compensation fair value adjustments, net of tax.
Adjusted EBITDA refers to net income before interest, taxes, depreciation and amortization, as adjusted, to the extent they occur, for earnout accretion, earnout fair value adjustments, contingent compensation, deferred compensation plan income or expense, certain reorganization costs, impairment charges and restructuring charges.
Adjusted EBITDA margin refers to adjusted EBITDA as a percentage of net revenue in the same period.
The Company evaluates its results of operations on both an as reported and a constant currency basis. The constant currency presentation is a non-GAAP financial measure, which excludes the impact of fluctuations in foreign currency exchange rates. The Company believes providing constant currency information provides valuable supplemental information regarding its results of operations, consistent with how it evaluates its performance. The Company calculates constant currency percentages by converting its financial results in a local currency for a period using the average exchange rate for the prior period to which it is comparing. This calculation may differ from similarly titled measures used by other companies.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the federal securities laws, including statements regarding guidance for the third quarter of 2025. The forward-looking statements are based on current expectations, estimates, forecasts, and projections about the industry in which we operate and management's beliefs and assumptions. Forward-looking statements may be identified by the use of words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "outlook," "projects," "forecasts," "aim" and similar expressions. Forward-looking statements are not guarantees of future performance, rely on a number of assumptions, and involve certain known and unknown risks and uncertainties that are difficult to predict, many of which are beyond our control. Factors that may cause actual outcomes and results to differ materially from what is expressed, forecasted or implied in the forward-looking statements include, among other things, our ability to attract, integrate, develop, manage, retain and motivate qualified consultants and senior leaders; our ability to prevent our consultants from taking our clients with them to another firm; our ability to maintain our professional reputation and brand name; our clients' ability to restrict us from recruiting their employees; our heavy reliance on information management systems; risks arising from our implementation of new technology and intellectual property to deliver new products and services to our clients; our dependence on third parties for the execution of certain critical functions; the fact that we face the risk of liability in the services we perform; the fact that data security, data privacy and data protection laws and other evolving regulations and cross-border data transfer restrictions may limit the use of our services and adversely affect our business; any challenges to the classification of our on-demand talent as independent contractors; the fact that increased cybersecurity requirements, vulnerabilities, threats and more sophisticated and targeted cyber-related attacks could pose a risk to our systems, networks, solutions, services and data; the fact that our net revenue may be affected by adverse macroeconomic or labor market conditions, including impacts of inflation and effects of geopolitical instability; the aggressive competition we face; the impact of foreign currency exchange rate fluctuations; our ability to access additional credit; social, political, regulatory, legal and economic risks in markets where we operate, including the impact of the ongoing war in Ukraine, the conflict between Israel and Hamas and any broader regional conflict in the Middle East, the risks of an expansion or escalation of those conflicts and our ability to quickly and completely recover from any disruption to our business; the impact from actions by the U.S. presidential administration and Congress; unfavorable tax law changes and tax authority rulings; our ability to realize the benefit of our net deferred tax assets; the fact that we may not be able to align our cost structure with net revenue; any impairment of our goodwill, other intangible assets and other long-lived assets; our ability to maintain an effective system of disclosure controls and internal control over our financial reporting and produce accurate and timely financial statements; our ability to execute and integrate future acquisitions; and the fact that we have anti-takeover provisions that make an acquisition of us difficult and expensive. We caution the reader that the list of factors may not be exhaustive. For more information on these risks, uncertainties and other factors, refer to our Annual Report on Form 10-K for the year ended December 31, 2024, under the heading "Risk Factors" in Item 1A. The forward-looking statements contained in this press release speak only as of the date of this press release. We undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
Contacts:
Investors & Analysts:
Vance Edelson
[email protected]
Media:
Bianca Wilson, Global Director, Public Relations
[email protected]
Heidrick & Struggles International, Inc. Consolidated Statements of Comprehensive Income (Loss) (In thousands, except per share amounts) (Unaudited)
| |||||||
Three Months Ended June 30, | |||||||
2025 | 2024 | $ Change | % Change | ||||
Revenue | |||||||
Revenue before reimbursements (net revenue) | $ 317,248 | $ 278,626 | $ 38,622 | 13.9 % | |||
Reimbursements | 4,660 | 4,251 | 409 | 9.6 % | |||
Total revenue | 321,908 | 282,877 | 39,031 | 13.8 % | |||
Operating expenses | |||||||
Salaries and benefits | 209,203 | 177,892 | 31,311 | 17.6 % | |||
General and administrative expenses | 42,184 | 46,453 | (4,269) | (9.2) % | |||
Cost of services | 34,594 | 29,696 | 4,898 | 16.5 % | |||
Research and development | 6,037 | 5,605 | 432 | 7.7 % | |||
Impairment charges | — | 16,224 | (16,224) | (100.0) % | |||
Restructuring charges | — | 6,939 | (6,939) | (100.0) % | |||
Reimbursed expenses | 4,660 | 4,251 | 409 | 9.6 % | |||
Total operating expenses | 296,678 | 287,060 | 9,618 | 3.4 % | |||
Operating income (loss) | 25,230 | (4,183) | 29,413 | NM | |||
Non-operating income | |||||||
Interest, net | 2,639 | 2,612 | |||||
Other, net | 3,276 | 997 | |||||
Net non-operating income | 5,915 | 3,609 | |||||
Income (loss) before income taxes | 31,145 | (574) | |||||
Provision for income taxes | 10,072 | 4,583 | |||||
Net income (loss) | 21,073 | (5,157) | |||||
Other comprehensive income (loss), net of tax | 6,519 | (2,094) | |||||
Comprehensive income (loss) | $ 27,592 | $ (7,251) | |||||
Weighted-average common shares outstanding | |||||||
Basic | 20,649 | 20,259 | |||||
Diluted | 21,215 | 20,259 | |||||
Earnings (loss) per common share | |||||||
Basic | $ 1.02 | $ (0.25) | |||||
Diluted | $ 0.99 | $ (0.25) | |||||
Salaries and benefits as a % of net revenue | 65.9 % | 63.8 % | |||||
General and administrative expenses as a % of net revenue | 13.3 % | 16.7 % | |||||
Cost of services as a % of net revenue | 10.9 % | 10.7 % | |||||
Research and development as a % of net revenue | 1.9 % | 2.0 % | |||||
Operating margin | 8.0 % | (1.5) % | |||||
Heidrick & Struggles International, Inc. Segment Information (In thousands) (Unaudited)
| |||||||||||
Three Months Ended June 30, | |||||||||||
2025 | 2024 | $ | % | 2025 | 2024 | ||||||
Revenue | |||||||||||
Executive Search | |||||||||||
Americas | $ 160,170 | $ 147,078 | $ 13,092 | 8.9 % | |||||||
Europe | 52,451 | 40,082 | 12,369 | 30.9 % | |||||||
Asia Pacific | 25,553 | 22,807 | 2,746 | 12.0 % | |||||||
Total Executive Search | 238,174 | 209,967 | 28,207 | 13.4 % | |||||||
On-Demand Talent | 47,866 | 41,895 | 5,971 | 14.3 % | |||||||
Heidrick Consulting | 31,208 | 26,764 | 4,444 | 16.6 % | |||||||
Revenue before reimbursements (net revenue) | 317,248 | 278,626 | 38,622 | 13.9 % | |||||||
Reimbursements | 4,660 | 4,251 | 409 | 9.6 % | |||||||
Total revenue | $ 321,908 | $ 282,877 | $ 39,031 | 13.8 % | |||||||
Adjusted EBITDA | |||||||||||
Executive Search | |||||||||||
Americas | $ 46,655 | $ 48,112 | $ (1,457) | (3.0) % | 29.1 % | 32.7 % | |||||
Europe | 5,388 | 2,840 | 2,548 | 89.7 % | 10.3 % | 7.1 % | |||||
Asia Pacific | 2,507 | 1,740 | 767 | 44.1 % | 9.8 % | 7.6 % | |||||
Total Executive Search | 54,550 | 52,692 | 1,858 | 3.5 % | 22.9 % | 25.1 % | |||||
On-Demand Talent | 1,028 | (1,629) | 2,657 | 163.1 % | 2.1 % | (3.9) % | |||||
Heidrick Consulting | 555 | (1,395) | 1,950 | 139.8 % | 1.8 % | (5.2) % | |||||
Total segments | 56,133 | 49,668 | 6,465 | 13.0 % | 17.7 % | 17.8 % | |||||
Research and Development | (4,638) | (4,781) | 143 | 3.0 % | (1.5) % | (1.7) % | |||||
Global Operations Support | (17,643) | (16,076) | (1,567) | (9.7) % | (5.6) % | (5.8) % | |||||
Total Adjusted EBITDA | $ 33,852 | $ 28,811 | $ 5,041 | 17.5 % | 10.7 % | 10.3 % | |||||
1 Margin based on revenue before reimbursements (net revenue). | |||||||||||
Heidrick & Struggles International, Inc. Consolidated Statements of Comprehensive Income (In thousands, except per share amounts) (Unaudited)
| |||||||
Six Months Ended June 30, | |||||||
2025 | 2024 | $ Change | % Change | ||||
Revenue | |||||||
Revenue before reimbursements (net revenue) | $ 600,826 | $ 543,823 | $ 57,003 | 10.5 % | |||
Reimbursements | 8,524 | 8,152 | 372 | 4.6 % | |||
Total revenue | 609,350 | 551,975 | 57,375 | 10.4 % | |||
Operating expenses | |||||||
Salaries and benefits | 398,678 | 352,305 | 46,373 | 13.2 % | |||
General and administrative expenses | 83,608 | 87,816 | (4,208) | (4.8) % | |||
Cost of services | 64,653 | 57,128 | 7,525 | 13.2 % | |||
Research and development | 12,429 | 11,320 | 1,109 | 9.8 % | |||
Impairment charges | — | 16,224 | (16,224) | (100.0) % | |||
Restructuring charges | — | 6,939 | (6,939) | (100.0) % | |||
Reimbursed expenses | 8,524 | 8,152 | 372 | 4.6 % | |||
Total operating expenses | 567,892 | 539,884 | 28,008 | 5.2 % | |||
Operating income | 41,458 | 12,091 | 29,367 | 242.9 % | |||
Non-operating income | |||||||
Interest, net | 6,594 | 6,698 | |||||
Other, net | 710 | 3,568 | |||||
Net non-operating income | 7,304 | 10,266 | |||||
Income before income taxes | 48,762 | 22,357 | |||||
Provision for income taxes | 14,383 | 13,482 | |||||
Net income | 34,379 | 8,875 | |||||
Other comprehensive income (loss), net of tax | 9,021 | (6,185) | |||||
Comprehensive income | $ 43,400 | $ 2,690 | |||||
Weighted-average common shares outstanding | |||||||
Basic | 20,557 | 20,202 | |||||
Diluted | 21,333 | 21,061 | |||||
Earnings per common share | |||||||
Basic | $ 1.67 | $ 0.44 | |||||
Diluted | $ 1.61 | $ 0.42 | |||||
Salaries and benefits as a % of net revenue | 66.4 % | 64.8 % | |||||
General and administrative expenses as a % of net revenue | 13.9 % | 16.1 % | |||||
Cost of services as a % of net revenue | 10.8 % | 10.5 % | |||||
Research and development as a % of net revenue | 2.1 % | 2.1 % | |||||
Operating margin | 6.9 % | 2.2 % | |||||
Heidrick & Struggles International, Inc. Segment Information (In thousands) (Unaudited)
| |||||||||||
Six Months Ended June 30, | |||||||||||
2025 | 2024 | $ Change | % Change | 2025 | 2024 | ||||||
Revenue | |||||||||||
Executive Search | |||||||||||
Americas | $ 304,574 | $ 283,757 | $ 20,817 | 7.3 % | |||||||
Europe | 97,842 | 81,563 | 16,279 | 20.0 % | |||||||
Asia Pacific | 49,148 | 46,128 | 3,020 | 6.5 % | |||||||
Total Executive Search | 451,564 | 411,448 | 40,116 | 9.7 % | |||||||
On-Demand Talent | 90,430 | 79,752 | 10,678 | 13.4 % | |||||||
Heidrick Consulting | 58,832 | 52,623 | 6,209 | 11.8 % | |||||||
Revenue before reimbursements (net revenue) | 600,826 | 543,823 | 57,003 | 10.5 % | |||||||
Reimbursements | 8,524 | 8,152 | 372 | 4.6 % | |||||||
Total revenue | $ 609,350 | $ 551,975 | $ 57,375 | 10.4 % | |||||||
Adjusted EBITDA | |||||||||||
Executive Search | |||||||||||
Americas | $ 90,877 | $ 89,983 | $ 894 | 1.0 % | 29.8 % | 31.7 % | |||||
Europe | 10,430 | 6,193 | 4,237 | 68.4 % | 10.7 % | 7.6 % | |||||
Asia Pacific | 5,542 | 4,935 | 607 | 12.3 % | 11.3 % | 10.7 % | |||||
Total Executive Search | 106,849 | 101,111 | 5,738 | 5.7 % | 23.7 % | 24.6 % | |||||
On-Demand Talent | 1,428 | (2,550) | 3,978 | 156.0 % | 1.6 % | (3.2) % | |||||
Heidrick Consulting | (1,541) | (3,422) | 1,881 | 55.0 % | (2.6) % | (6.5) % | |||||
Total Segments | 106,736 | 95,139 | 11,597 | 12.2 % | 17.8 % | 17.5 % | |||||
Research and Development | (9,262) | (9,706) | 444 | 4.6 % | (1.5) % | (1.8) % | |||||
Global Operations Support | (34,500) | (30,754) | (3,746) | (12.2) % | (5.7) % | (5.7) % | |||||
Total Adjusted EBITDA | $ 62,974 | $ 54,679 | $ 8,295 | 15.2 % | 10.5 % | 10.1 % | |||||
1 Margin based on revenue before reimbursements (net revenue). | |||||||||||
Heidrick & Struggles International, Inc. Reconciliation of Net Income (Loss) and Adjusted Net Income (Non-GAAP) (In thousands, except per share amounts) (Unaudited)
| |||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||
2025 | 2024 | 2025 | 2024 | ||||
Net income (loss) | $ 21,073 | $ (5,157) | $ 34,379 | $ 8,875 | |||
Adjustments | |||||||
Acquisition related earnout and contingent compensation fair value adjustments, net of tax | (2,980) | 749 | (2,095) | 749 | |||
Impairment charges, net of tax | — | 14,190 | — | 14,190 | |||
Restructuring charges, net of tax | — | 4,291 | 4,291 | ||||
Total adjustments | (2,980) | 19,230 | (2,095) | 19,230 | |||
Adjusted net income | $ 18,093 | $ 14,073 | $ 32,284 | $ 28,105 | |||
Weighted-average common shares outstanding | |||||||
Basic | 20,649 | 20,259 | 20,557 | 20,202 | |||
Diluted | 21,215 | 20,865 | 21,333 | 21,061 | |||
Earnings (loss) per common share | |||||||
Basic | $ 1.02 | $ (0.25) | $ 1.67 | $ 0.44 | |||
Diluted | $ 0.99 | $ (0.25) | $ 1.61 | $ 0.42 | |||
Adjusted earnings per common share | |||||||
Basic | $ 0.88 | $ 0.69 | $ 1.57 | $ 1.39 | |||
Diluted | $ 0.85 | $ 0.67 | $ 1.51 | $ 1.33 | |||
Heidrick & Struggles International, Inc. Consolidated Balance Sheets (In thousands) (Unaudited)
| |||
June 30, | December 31, | ||
Current assets | |||
Cash and cash equivalents | $ 211,172 | $ 515,627 | |
Marketable securities | 188,355 | 47,896 | |
Accounts receivable, net | 210,577 | 134,331 | |
Prepaid expenses | 30,436 | 28,718 | |
Other current assets | 48,200 | 39,935 | |
Income taxes recoverable | 10,868 | 6,470 | |
Total current assets | 699,608 | 772,977 | |
Non-current assets | |||
Property and equipment, net | 54,687 | 51,685 | |
Operating lease right-of-use assets | 82,282 | 83,518 | |
Assets designated for retirement and pension plans | 11,361 | 9,976 | |
Investments | 69,160 | 58,290 | |
Other non-current assets | 26,395 | 25,500 | |
Goodwill | 142,635 | 137,861 | |
Other intangible assets, net | 10,539 | 12,483 | |
Deferred income taxes | 44,378 | 41,898 | |
Total non-current assets | 441,437 | 421,211 | |
Total assets | $ 1,141,045 | $ 1,194,188 | |
Current liabilities | |||
Accounts payable | $ 25,834 | $ 25,088 | |
Accrued salaries and benefits | 251,668 | 353,531 | |
Deferred revenue | 58,859 | 51,085 | |
Operating lease liabilities | 18,225 | 17,653 | |
Other current liabilities | 65,898 | 21,369 | |
Income taxes payable | 9,402 | 14,287 | |
Total current liabilities | 429,886 | 483,013 | |
Non-current liabilities | |||
Accrued salaries and benefits | 40,789 | 58,547 | |
Retirement and pension plans | 84,999 | 72,138 | |
Operating lease liabilities | 86,914 | 83,152 | |
Other non-current liabilities | 4,527 | 42,905 | |
Deferred income taxes | 1,439 | 1,616 | |
Total non-current liabilities | 218,668 | 258,358 | |
Total liabilities | 648,554 | 741,371 | |
Stockholders' equity | 492,491 | 452,817 | |
Total liabilities and stockholders' equity | $ 1,141,045 | $ 1,194,188 | |
Heidrick & Struggles International, Inc. Consolidated Statements of Cash Flows (In thousands) (Unaudited)
| ||||
Three Months Ended June 30, | ||||
2025 | 2024 | |||
Cash flows - operating activities | ||||
Net income (loss) | $ 21,073 | $ (5,157) | ||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||
Depreciation and amortization | 5,015 | 3,910 | ||
Deferred income taxes | 509 | (2,246) | ||
Stock-based compensation expense | 3,987 | 3,465 | ||
Accretion expense related to earnout payments | 536 | 469 | ||
Gain on marketable securities | (1,702) | (441) | ||
Loss on disposal of property and equipment | 19 | 247 | ||
Impairment charges | — | 16,224 | ||
Changes in assets and liabilities, net of effects of acquisition: | ||||
Accounts receivable | (23,178) | (14,717) | ||
Accounts payable | 980 | (255) | ||
Accrued expenses | 72,256 | 57,843 | ||
Restructuring accrual | (461) | 4,386 | ||
Deferred revenue | 1,628 | (2,624) | ||
Income taxes recoverable and payable, net | (11,471) | 645 | ||
Retirement and pension plan assets and liabilities | (702) | 347 | ||
Prepaid expenses | 4,097 | 3,339 | ||
Other assets and liabilities, net | (3,976) | (2,913) | ||
Net cash provided by in operating activities | 68,610 | 62,522 | ||
Cash flows - investing activities | ||||
Capital expenditures | (3,906) | (10,365) | ||
Purchases of marketable securities and investments | (177,487) | (109,862) | ||
Proceeds from sales of marketable securities and investments | 104,106 | 289 | ||
Net cash used in investing activities | (77,287) | (119,938) | ||
Cash flows - financing activities | ||||
Cash dividends paid | (3,251) | (3,182) | ||
Payment of employee tax withholdings on equity transactions | (887) | (885) | ||
Net cash used in financing activities | (4,138) | (4,067) | ||
Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash | 12,119 | (1,426) | ||
Net decrease in cash, cash equivalents and restricted cash | (696) | (62,909) | ||
Cash, cash equivalents and restricted cash at beginning of period | 212,138 | 252,831 | ||
Cash, cash equivalents and restricted cash at end of period | $ 211,442 | $ 189,922 | ||
Heidrick & Struggles International, Inc. Consolidated Statements of Cash Flows (In thousands) (Unaudited)
| ||||
Six Months Ended June 30, | ||||
2025 | 2024 | |||
Cash flows - operating activities | ||||
Net income | $ 34,379 | $ 8,875 | ||
Adjustments to reconcile net income to net cash used in operating activities: | ||||
Depreciation and amortization | 9,862 | 8,700 | ||
Deferred income taxes | (1,374) | (2,333) | ||
Stock-based compensation expense | 6,497 | 6,109 | ||
Accretion expense related to earnout payments | 1,017 | 935 | ||
Gain on marketable securities | (2,650) | (980) | ||
Loss on disposal of property and equipment | 26 | 261 | ||
Impairment charges | — | 16,224 | ||
Changes in assets and liabilities: | ||||
Accounts receivable | (68,787) | (55,842) | ||
Accounts payable | (1,530) | (2,324) | ||
Accrued expenses | (127,064) | (124,747) | ||
Restructuring accrual | (1,425) | 4,386 | ||
Deferred revenue | 5,975 | (673) | ||
Income taxes recoverable and payable, net | (9,625) | 5,368 | ||
Retirement and pension plan assets and liabilities | 6,030 | 5,800 | ||
Prepaid expenses | (576) | (4,652) | ||
Other assets and liabilities, net | (14,369) | (6,009) | ||
Net cash used in operating activities | (163,614) | (140,902) | ||
Cash flows - investing activities | ||||
Capital expenditures | (6,640) | (16,538) | ||
Purchases of marketable securities and investments | (296,206) | (115,262) | ||
Proceeds from sales of marketable securities and investments | 152,431 | 66,574 | ||
Net cash used in investing activities | (150,415) | (65,226) | ||
Cash flows - financing activities | ||||
Debt issuance costs | (360) | — | ||
Cash dividends paid | (6,447) | (6,398) | ||
Payment of employee tax withholdings on equity transactions | (3,776) | (3,747) | ||
Net cash used in financing activities | (10,583) | (10,145) | ||
Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash | 20,241 | (6,423) | ||
Net decrease in cash, cash equivalents and restricted cash | (304,371) | (222,696) | ||
Cash, cash equivalents and restricted cash at beginning of period | 515,813 | 412,618 | ||
Cash, cash equivalents and restricted cash at end of period | $ 211,442 | $ 189,922 | ||
Heidrick & Struggles International, Inc. Reconciliation of Net Income (Loss) to Adjusted EBITDA (Non-GAAP) (In thousands) (Unaudited)
| |||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||
2025 | 2024 | 2025 | 2024 | ||||
Revenue before reimbursements (net revenue) | $ 317,248 | $ 278,626 | $ 600,826 | $ 543,823 | |||
Net income (loss) | 21,073 | (5,157) | 34,379 | 8,875 | |||
Interest, net | (2,639) | (2,612) | (6,594) | (6,698) | |||
Other, net | (3,276) | (997) | (710) | (3,568) | |||
Provision for income taxes | 10,072 | 4,583 | 14,383 | 13,482 | |||
Operating income (loss) | 25,230 | (4,183) | 41,458 | 12,091 | |||
Adjustments | |||||||
Depreciation | 3,428 | 1,990 | 6,607 | 4,483 | |||
Intangible amortization | 1,587 | 1,920 | 3,255 | 4,217 | |||
Earnout accretion | 536 | 469 | 1,017 | 935 | |||
Earnout fair value adjustments | (3,257) | 1,211 | (2,315) | 1,211 | |||
Acquisition contingent consideration | 1,566 | 3,285 | 4,387 | 5,273 | |||
Deferred compensation plan | 5,198 | 956 | 4,840 | 3,306 | |||
Reorganization costs | (436) | — | 3,725 | — | |||
Impairment charges | — | 16,224 | — | 16,224 | |||
Restructuring charges | — | 6,939 | — | 6,939 | |||
Total adjustments | 8,622 | 32,994 | 21,516 | 42,588 | |||
Adjusted EBITDA | $ 33,852 | $ 28,811 | $ 62,974 | $ 54,679 | |||
Adjusted EBITDA margin | 10.7 % | 10.3 % | 10.5 % | 10.1 % | |||
Heidrick & Struggles International, Inc. Reconciliation of Operating Income (Loss) to Adjusted EBITDA by Line of Business (Non-GAAP) (In thousands) (Unaudited)
| |||||||||||
Three Months Ended June 30, 2025 | |||||||||||
Executive | On-Demand | Heidrick | Research & | Global | Total | ||||||
Revenue before reimbursements (net revenue) | $ 238,174 | $ 47,866 | $ 31,208 | $ — | $ — | $ 317,248 | |||||
Operating income (loss)1 | 48,200 | 3,198 | (1,557) | (6,037) | (18,574) | 25,230 | |||||
Adjustments | |||||||||||
Depreciation | 1,329 | 196 | 233 | 1,501 | 169 | 3,428 | |||||
Intangible amortization | 11 | 1,279 | 297 | — | — | 1,587 | |||||
Earnout accretion | — | 479 | 57 | — | — | 536 | |||||
Earnout fair value adjustments | — | (3,419) | 162 | — | — | (3,257) | |||||
Acquisition contingent compensation | — | 293 | 1,273 | — | — | 1,566 | |||||
Deferred compensation plan | 5,010 | 2 | 90 | 84 | 12 | 5,198 | |||||
Reorganization costs | — | (1,000) | — | (186) | 750 | (436) | |||||
Total adjustments | 6,350 | (2,170) | 2,112 | 1,399 | 931 | 8,622 | |||||
Adjusted EBITDA | $ 54,550 | $ 1,028 | $ 555 | $ (4,638) | $ (17,643) | $ 33,852 | |||||
Adjusted EBITDA margin | 22.9 % | 2.1 % | 1.8 % | (1.5) % | (5.6) % | 10.7 % | |||||
Three Months Ended June 30, 2024 | |||||||||||
Executive | On-Demand | Heidrick | Research & | Global | Total | ||||||
Revenue before reimbursements (net revenue) | $ 209,967 | $ 41,895 | $ 26,764 | $ — | $ — | $ 278,626 | |||||
Operating income (loss)1 | 46,821 | (21,695) | (6,530) | (5,605) | (17,174) | (4,183) | |||||
Adjustments | |||||||||||
Depreciation | 863 | 117 | 82 | 809 | 119 | 1,990 | |||||
Intangible amortization | 20 | 1,533 | 367 | — | — | 1,920 | |||||
Earnout accretion | — | 409 | 60 | — | — | 469 | |||||
Earnout fair value adjustments | — | 1,125 | 86 | — | — | 1,211 | |||||
Acquisition contingent compensation | 295 | 1,835 | 1,155 | — | — | 3,285 | |||||
Deferred compensation plan | 920 | — | 18 | 15 | 3 | 956 | |||||
Impairment charges | 1,463 | 14,761 | — | — | — | 16,224 | |||||
Restructuring charges | 2,310 | 286 | 3,367 | — | 976 | 6,939 | |||||
Total adjustments | 5,871 | 20,066 | 5,135 | 824 | 1,098 | 32,994 | |||||
Adjusted EBITDA | $ 52,692 | $ (1,629) | $ (1,395) | $ (4,781) | $ (16,076) | $ 28,811 | |||||
Adjusted EBITDA margin | 25.1 % | (3.9 %) | (5.2 %) | (1.7) % | (5.8) % | 10.3 % | |||||
1 The Company does not allocate interest income or expense, other income or expense, and the provision for income taxes to the Company's reportable operating segments. As such, the Company has concluded that operating income (loss) represents the most directly comparable measure of financial performance presented in accordance with U.S. GAAP for the reconciliation of Adjusted EBITDA in this presentation. |
Heidrick & Struggles International, Inc. Reconciliation of Operating Income (Loss) to Adjusted EBITDA (Non-GAAP) (In thousands) (Unaudited)
| |||||||||||
Six Months Ended June 30, 2025 | |||||||||||
Executive | On-Demand | Heidrick | Research & | Global | Total | ||||||
Revenue before reimbursements (net revenue) | $ 451,564 | $ 90,430 | $ 58,832 | $ — | $ — | $ 600,826 | |||||
Operating income (loss)1 | 98,708 | (2,436) | (5,384) | (12,429) | (37,001) | 41,458 | |||||
Adjustments | |||||||||||
Depreciation | 2,505 | 404 | 441 | 2,938 | 319 | 6,607 | |||||
Intangible amortization | 22 | 2,569 | 664 | — | — | 3,255 | |||||
Earnout accretion | — | 906 | 111 | — | — | 1,017 | |||||
Earnout fair value adjustments | — | (2,477) | 162 | — | — | (2,315) | |||||
Acquisition contingent compensation | — | 2,210 | 2,177 | — | — | 4,387 | |||||
Deferred compensation plan | 4,661 | 2 | 86 | 79 | 12 | 4,840 | |||||
Reorganization costs | 953 | 250 | 202 | 150 | 2,170 | 3,725 | |||||
Total adjustments | 8,141 | 3,864 | 3,843 | 3,167 | 2,501 | 21,516 | |||||
Adjusted EBITDA | $ 106,849 | $ 1,428 | $ (1,541) | $ (9,262) | $ (34,500) | $ 62,974 | |||||
Adjusted EBITDA margin | 23.7 % | 1.6 % | (2.6 %) | (1.5 %) | (5.7) % | 10.5 % | |||||
Six Months Ended June 30, 2024 | |||||||||||
Executive | On-Demand | Heidrick | Research & | Global | Total | ||||||
Revenue before reimbursements (net revenue) | $ 411,448 | $ 79,752 | $ 52,623 | $ — | $ — | $ 543,823 | |||||
Operating income (loss)1 | 92,353 | (26,544) | (10,372) | (11,320) | (32,026) | 12,091 | |||||
Adjustments | |||||||||||
Depreciation | 2,104 | 248 | 279 | 1,563 | 289 | 4,483 | |||||
Intangible amortization | 37 | 3,368 | 812 | — | — | 4,217 | |||||
Earnout accretion | — | 815 | 120 | — | — | 935 | |||||
Earnout fair value adjustments | — | 1,125 | 86 | — | — | 1,211 | |||||
Acquisition contingent compensation | (335) | 3,391 | 2,217 | — | — | 5,273 | |||||
Deferred compensation plan | 3,179 | — | 69 | 51 | 7 | 3,306 | |||||
Impairment charges | 1,463 | 14,761 | — | — | — | 16,224 | |||||
Restructuring charges | 2,310 | 286 | 3,367 | — | 976 | 6,939 | |||||
Total adjustments | 8,758 | 23,994 | 6,950 | 1,614 | 1,272 | 42,588 | |||||
Adjusted EBITDA | $ 101,111 | $ (2,550) | $ (3,422) | $ (9,706) | $ (30,754) | $ 54,679 | |||||
Adjusted EBITDA margin | 24.6 % | (3.2 %) | (6.5 %) | (1.8 %) | (5.7 %) | 10.1 % | |||||
1 The Company does not allocate interest income or expense, other income or expense, and the provision for income taxes to the Company's reportable operating segments. As such, the Company has concluded that operating income (loss) represents the most directly comparable measure of financial performance presented in accordance with U.S. GAAP for the reconciliation of Adjusted EBITDA in this presentation. |
SOURCE Heidrick & Struggles
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