FTI Consulting drops as Q1 revenue rises but margins compress sharply
FCN•FTI Consulting shares slid after its April 30, 2026 Q1 results showed solid top-line growth but weaker profitability. Revenue rose 9.5% to $983.3 million and GAAP EPS increased to $1.90, while adjusted EBITDA margin fell to 9.8% and Economic Consulting swung to an operating loss.
1) What happened
FTI Consulting (FCN) is down about 4.65% after reporting first-quarter 2026 results before the open on April 30, 2026. The headline numbers showed continued demand, but investors focused on profitability pressure, segment mix, and a higher leverage profile following the quarter.
2) The numbers driving the selloff
Q1 revenue increased 9.5% year over year to $983.3 million and GAAP EPS rose 9.2% to $1.90. However, adjusted EBITDA fell to $96.8 million and adjusted EBITDA margin compressed to 9.8% from 12.8% a year ago, alongside a decline in net income to $57.6 million from $61.8 million. Economic Consulting was a key weak spot, posting an operating loss of $7.3 million versus operating income of $12.1 million in the prior-year quarter.
3) Guidance, capital returns, and balance-sheet watchpoints
The company reaffirmed full-year 2026 guidance of $3.94 billion to $4.10 billion in revenue and $8.90 to $9.60 in EPS, signaling management still expects full-year growth despite the margin dip. FTI repurchased $126.8 million of shares in Q1 and ended the quarter with about $364.9 million remaining under its authorization, but net debt increased to $556.7 million (total debt less cash) compared with $8.9 million a year earlier, which added to investor caution even as revenue momentum held up.
