Strong Overall Revenue Growth (RBR)
Revenues before reimbursable expenses (RBR) were $443.7M in Q1 2026, up 12.1% versus $395.7M in Q1 2025, driven by growth across health care, education, and commercial segments.
Huron Consulting
· HURN
May 5th, 2026
Summary
- Earnings Call Date:
- 2026-05-05
- Change Since:
- -26.99%
- Next Earnings Date:
- 2026-07-23
Earnings Call Sentiment
PositiveThe call conveyed solid top-line growth, margin expansion, record healthcare performance, strong bookings and backlog, and confidence in AI-driven opportunities—leading management to reaffirm full-year guidance. Offsetting items include significant Q1 cash outflows (annual bonuses and buybacks) that produced negative free cash flow, higher net debt and leverage (3.1x), rising corporate costs, and some digital revenue softness and timing-related DSO increases. Management signaled they will moderate repurchases and target leverage reduction to the low twos by year-end.
Company Guidance
Management affirmed 2026 guidance, reiterating RBR of $1.78–$1.86 billion, adjusted EBITDA of 14.5%–15.0% of RBR, and adjusted (non‑GAAP) diluted EPS of $8.35–$9.15; they also expect a full‑year effective tax rate of about 28%–30%, positive free cash flow of $180–$220 million (net of cash taxes and interest, excluding noncash stock‑based comp), and a year‑end leverage target of 2.0x–2.5x adjusted EBITDA (after a seasonal Q1 leverage of 3.1x). Management reiterated disciplined capital allocation—continued programmatic tuck‑in M&A (M&A contribution to growth ~2%–4%, likely toward the lower end) and ongoing share repurchases (Q1 buybacks were $155.5M, ~1.1M shares).
Record Health Care Performance
Health care segment posted record RBR of $225.2M, up $26.7M or 13.5% year-over-year; organic health care growth (ex-acquisitions) was 10% in Q1 2026.
Robust Commercial and Education Growth
Commercial RBR grew 22.3% to $91.0M (including $11.0M incremental RBR from acquisitions); education RBR increased 3.8% to $127.5M with education operating margin improving to 21.6% from 18.8%.
Margin Expansion and Profitability
Adjusted EBITDA increased to $50.6M (11.4% of RBR) from $41.5M (10.5% of RBR) a year earlier; segment operating margins improved in education (21.6% vs 18.8%) and commercial (16.4% vs 15.2%); health care margin remained strong at 28.4%.
Strong Bookings, Backlog, and Pipeline
Bookings in the trailing six months were up over 20% across all three segments; backlog provides historically high coverage ratios and pipeline is at near-record levels as of April versus December 31.
Affirmed Full-Year Guidance
Management affirmed 2026 guidance: RBR $1.78B–$1.86B, adjusted EBITDA 14.5%–15.0% of RBR, and adjusted non-GAAP EPS $8.35–$9.15, reflecting confidence from a strong Q1 start.
Active Capital Allocation and Share Repurchases
Company repurchased ~$155.5M of stock in Q1 (approx. 1.1M shares, 6.5% of outstanding at start of year); since 12/31/2022 repurchased 5M shares (25% of common stock outstanding), demonstrating shareholder return focus.
Strategic Positioning Around AI and Digital
Management is bullish on AI as a double-digit growth market and has increased investment in AI capabilities; digital talent comprises a substantial portion of the business (~40% historically tied to technology/digital), positioning the firm to capture AI-driven demand.
Operator
Good afternoon, and welcome to Huron Consulting Group Inc.'s webcast to discuss financial results for 2026. At this time, conference call lines are in a listen-only mode. Later, we will conduct a question-and-answer session for the conference call and instructions will follow at that time. As a reminder, this conference call is being recorded. Before we begin, I would like to point all of you to the disclosure at the end of the company's news release for information about any forward-looking statements that may be made or discussed on this call. The news release is posted on Huron Consulting Group Inc.'s website. Please review that information along with the filings with the SEC for disclosure of factors that may impact subjects discussed in this afternoon's webcast. The company will be discussing one or more non-GAAP financial measures.
Please look at the earnings release and on Huron Consulting Group Inc.'s website for all of the disclosures required by the SEC, including reconciliation to the most comparable GAAP numbers. And now I would like to turn the call over to C. Mark Hussey, Chief Executive and President of Huron Consulting Group Inc. Mr. Hussey, please go ahead.
C. Mark Hussey
Good afternoon, and welcome to Huron Consulting Group Inc.'s first quarter 2026 earnings call. With me today are John D. Kelly, our Chief Financial Officer, and Ronnie Dale, our Chief Operating Officer. I will begin by noting that the execution of our growth strategy continues to deliver performance consistent with the financial goals outlined for 2025 investor day. Revenues before reimbursable expenses,...
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