FTI Consulting, Inc. (FCN) SEC Filings & Earnings Calls

Margin compression from higher direct costs, SG&A, and interest expense.

“Adjusted EBITDA margin declined to 10.5% from 11.8% due to higher direct costs, SG&A expenses and interest expense.”

Increased leverage from share repurchase financing; total debt net of cash rose to $856.3M from $317.2M YoY.

“Total debt, net of cash, of $856.3 million at June 30, 2026 compared to $317.2 million at June 30, 2025.” · word for word

Extraordinary litigation-related expenses of $6.6M ($0.17 EPS impact) and $0.40 estimated for full year.

“Second quarter 2026 Adjusted EBITDA excludes $6.6 million of Extraordinary Litigation-Related Expenses. Full year guidance includes an estimated $0.40 of Extraordinary Litigation-Related Expenses.”

Margin compression from cost inflation

“The decrease in Adjusted EBITDA was primarily due to higher direct costs and SG&A expenses” · word for word

Litigation expense overhang

“Extraordinary Litigation-Related Expenses $6,623”

Economic Consulting segment weakness

“Economic Consulting 7,444 12,807” · word for word

Increased debt capacity may lead to higher leverage if utilized.

“permits the Company ... to incur incremental facilities in an aggregate amount of up to ... $500.0 million and ... 100% of consolidated EBITDA”

Margin compression from cost inflation

“Adjusted EBITDA Margin of 9.8% for the three months ended March 31, 2026 compared to 12.8% for the three months ended March 31, 2025.” · word for word

Economic Consulting segment weakness

“Segment operating income (loss) (7,331) 12,089 ... Percentage change in segment operating income (loss) from prior year -160.6%” · word for word

Key person / succession risk for CEO

“During this extended term, a key goal of the NCGSR Committee, the Board and Mr. Gunby is to identify a successor for the CEO role and to have Mr. Gunby mentor that successor as he or she assumes the role of CEO.” · word for word

Competitive pressure in Compass Lexecon

“The expectation for substantial headwinds in our Economic Consulting segment in 2025 compared with 2024 due to a disruption in the Compass Lexecon business within the Economic Consulting segment. At the time the Company provided guidance on February 20, 2025, a number of senior professionals in Compass Lexecon had either departed or shared their intent to de” · word for word

Increased leverage from $300M incremental debt.

“Creation of a direct financial obligation; incremental term loan increases total debt.”

CFO transition risk; new CFO may take time to acclimate.

“New CFO appointed; start date expected on or about May 1, 2026.”

Cash flow decline due to higher forgivable loan issuances and compensation payments

“Net cash provided by operating activities decreased to $152.1M from $395.1M”

M&A Demand Dependency

“The decrease in revenues was primarily due to lower demand for our M&A-related antitrust and non-M&A-related antitrust services” · word for word

Free Cash Flow Deterioration

“Free Cash Flow was an inflow of $93.6 million and $360.2 million for the years ended December 31, 2025 and 2024, respectively.” · word for word

Interest Expense Increase

“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.” · word for word

Headcount Reduction

“Total number of employees 8,118 8,374 -3.1 %” · word for word

Revenue decline in Economic Consulting and Technology segments indicates headwinds in those areas.

“partially offset by lower revenues in the Economic Consulting and Technology segments” · word for word

Operating cash flow decreased YoY due to lower cash collections and higher tax payments.

“Net cash provided by operating activities of $201.9 million... compared to $219.4 million... primarily due to lower cash collections and an increase in income tax” · word for word