FTI Consulting Q2 2025 slides: sequential growth amid year-over-year declines

FTI Consulting, Inc. (NYSE:FCN) released its second quarter 2025 earnings presentation on July 24, showing sequential improvement in key financial metrics while still facing year-over-year challenges. The company’s stock edged up 0.39% in premarket trading to $168.20, reflecting cautious investor optimism about the mixed results.

Executive Summary

FTI Consulting reported Q2 2025 revenues of $943.7 million, representing a 5.1% increase from the previous quarter but a slight 0.6% decrease compared to the same period last year. Net income reached $71.7 million, up 16.0% sequentially but down 14.6% year-over-year. Earnings per diluted share came in at $2.13, showing a significant 22.4% improvement from Q1 2025’s $1.74, though still 9.0% below the $2.34 reported in Q2 2024.

As shown in the following consolidated financial results:

The company’s adjusted EBITDA for the quarter was $111.6 million, representing an 11.8% margin, down from 12.8% in Q1 2025 and 12.2% in Q2 2024. This margin compression comes despite the sequential revenue growth, suggesting ongoing cost pressures.

Detailed Financial Analysis

FTI Consulting’s performance varied significantly across its business segments. The segment breakdown reveals the diverse performance across the company’s portfolio:

From a geographic perspective, North America continues to be the company’s largest market, accounting for 71.2% of consolidated revenues in Q2 2025. The EMEA region represented 19.7%, while Asia Pacific and Latin America contributed 7.5% and 1.6%, respectively.

The company’s cash position remained relatively stable at $152.8 million as of June 30, 2025, compared to $151.1 million at the end of the previous quarter. However, total debt increased substantially to $470 million from $160 million in Q1 2025, reflecting a significant change in capital structure.

Free cash flow showed marked improvement, reaching $38.3 million in Q2 2025 compared to negative $483.0 million in the previous quarter. Days sales outstanding remained steady at 100 days, an improvement from 105 days in the same period last year.

The reconciliation of net income to adjusted figures provides additional insight into the company’s performance without special charges that affected Q1 results:

Strategic Initiatives

FTI Consulting’s capital allocation strategy has shifted notably, with substantial resources directed toward share repurchases. The company spent $354.0 million on stock buybacks in Q2 2025, significantly higher than the $182.6 million spent in Q1. This aggressive repurchase program, combined with the substantial increase in debt, suggests management’s confidence in the company’s long-term prospects despite current challenges.

The increase in property and equipment purchases to $17.4 million in Q2 2025 from $10.1 million in Q2 2024 indicates continued investment in operational infrastructure. This comes as the company balances growth initiatives with profitability pressures.

Competitive Industry Position

Despite financial challenges, FTI Consulting continues to maintain strong industry recognition. The company’s expertise and market leadership are reflected in numerous awards and accolades received during the quarter:

These recognitions highlight FTI Consulting’s continued industry leadership and expertise across multiple practice areas, particularly in restructuring, investigations, and crisis management. The company’s #1 ranking as Financial Advisor in the Americas Restructuring Rankings is especially notable given current economic uncertainties.

Forward-Looking Statements

The sequential improvement in FTI Consulting’s financial performance suggests potential stabilization after the challenging first quarter. However, year-over-year declines in key metrics indicate ongoing market pressures. The significant increase in debt levels, while providing capital for share repurchases, may raise concerns about financial flexibility if market conditions deteriorate.

Based on the previous quarter’s earnings call, the company had expressed caution about achieving adjusted EPS growth for the full year. The Q2 results, while showing sequential improvement, still reflect a 9.0% year-over-year decline in EPS, suggesting these challenges persist.

The company’s continued investment in talent and strategic areas, coupled with its industry recognition, positions it to navigate market uncertainties. However, investors will likely monitor the balance between growth initiatives, debt management, and shareholder returns as FTI Consulting moves through the second half of 2025.

Full presentation:

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