FCN

FTI CONSULTING, INC

NYSE · INDUSTRIALS · SERVICES-MANAGEMENT CONSULTING SERVICES

161.40

+4.16 +2.65%

USD · close Oct 26

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MKT CAP $4.5BP/E 19.4DIV YIELD —FCF YIELD 8.05%REV TTM $3.9B +7.1%NET INCOME $252.8M +1.2%NET DEBT $855.6M52W 130.45 – 187.03SEC XBRL · TTM TO Invalid Date

How FCN rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

Text kept

76%

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new sentences

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sentences removed

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+173

words, now 11,658

New in FY2025

RISK FACTORS All of the following risks, uncertainties and factors could materially and adversely affect our business, prospects, financial condition, results of operations, cash flows and liquidity.
In addition to the risks, uncertainties and factors discussed below and elsewhere in this Annual Report, other risks, uncertainties and factors not currently known to us or that we currently consider immaterial could, in the future, materially and adversely affect our business, prospects, financial condition, financial results, cash flows and liquidity.
Some of the risks, uncertainties and factors discussed below may have occurred in the past, but the disclosures below are not representations as to whether or not the risks, uncertainties or factors have occurred in the past, and instead reflect our beliefs and opinions as to the risks, uncertainties and factors that could materially and adversely affect us in the future.
These include: (i) fluctuations in U.S. and/or global economies, including economic downturns or recessions and the strength and rate of any general economic recoveries; (ii) the U.S. or global financial markets and the availability, costs, and terms of credit and credit modifications, including interest rate levels and inflationary pressures; (iii) level of leverage incurred by countries or businesses; (iv) M&A activity; (v) frequency and complexity of significant commercial litigation; (vi) overexpansion by businesses causing financial difficulties; (vii) business and management crises, including the occurrence of alleged fraudulent or illegal activities and practices; (viii) new and complex laws and regulations, repeals of existing laws and regulations or changes of enforcement of laws, rules and regulations, including antitrust/competition reviews of proposed M&A transactions; (ix) other economic, geographic or political factors, including wars and other geopolitical conflicts; (x) widespread public health crises, including epidemics and pandemics and government restrictions or regulations enacted in response thereto, or employees’ refusal to adhere to such restrictions; and (xi) general business or other conditions in the U.S. and other jurisdictions in which we conduct business or our employee population resides.
On the other hand, those same factors may cause one or more of our other segments and practices, such as our M&A-related “second request” services in Technology, to experience reduced demand.
Technology — The settlement of litigation; a decline in volume and complexity of litigation proceedings and governmental investigations; a decline in volume and the timing of M&A activities and reduced or less aggressive enforcement of antitrust and competition regulations; the more rapid and successful integration of new and emerging technologies in client offerings, such as artificial intelligence (“AI”) or machine learning, by competitors, or the availability and engagement of independent consultants, which this segment, more than our other segments, relies on for staffing e-discovery and certain other types of client engagements.
Our segments may face risks of fee non-payment, and clients may seek to renegotiate existing fees and contract arrangements and may not accept billable rate or price increases, which could result in loss of engagements, fee write-offs, reduced revenues and less profitable business.
Our segments and practices could suffer competitive, reputational and business harm or increased liability or legal or regulatory action arising from the rapid introduction, integration, deployment, evolution and use of new technologies, including AI.
The benefits and risks of adopting and implementing new and emerging technologies, such as AI, necessitates, in most cases, our review and analysis of such technology and its risks and benefits on a service-by-service basis.
Moreover, AI algorithms and training methodologies may be flawed and datasets may be over-broad, insufficient or contain biased or inaccurate information.
The adoption of new technologies, such as AI, may require the investment of significant capital, time and resources.
Leveraging AI capabilities for our internal functions and operations presents additional risks, costs and challenges, including those discussed in these risk factors.
The development, adoption and use of AI technologies are still in the early stages and involve significant risks and uncertainties, which may expose us to legal, reputational and financial harm.
In addition, AI and other technologies that are open source and available for no or low cost could result in low barriers to development and utilization, and additional competition from third parties, and the adoption and deployment of AI and other new and emerging technologies by competitors more rapidly or successfully than we do could materially adversely affect our competitive position and financial results.
New technologies, such as AI, continue to evolve and as a result, risks continue to be unknown or uncertain.
We are increasingly applying AI-based technologies to our solutions and services, to how we deliver work for our clients, and in our own internal operations.
As these technologies evolve, some non-expert services and tasks currently performed by our professionals have been and will continue to be replaced by automation, including AI-enabled solutions, which could lead to reduced demand for our services and/or adversely affect the utilization rate of our professionals, if demand for those services is not replaced by demand for new solutions and services or if the pace and level of spending on new solutions or services are not sufficient to make up any shortfall.
If we are unable to introduce or if our clients do not accept new pricing or commercial models that reflect the value of these AI-enabled solutions, our results of operations may be adversely affected.
There is no assurance that (i) we can successfully develop, integrate and deploy AI or other technologies in our business, (ii) such technologies will improve and enhance our services, operations or profitability, (iii) clients will accept the incorporation of such technology in our services, (iv) we can successfully market the use of these technologies to prospective clients, (v) we can hire and retain staff with the required specialized knowledge and skills to utilize these technologies, (vi) new or heightened cybersecurity, data protection or other operational risks will not arise, (vii) we can identify, mitigate or recover from cybersecurity incidents or other adverse events that occur, (viii) we can protect and maintain the privacy of our employees and safeguard confidential and proprietary information, (ix) new laws, regulations or regulatory interpretations will not be adopted, or that compliance with any such requirements will not be burdensome, (x) material additional monetary and time expenditures will not be required, (xi) we can pass on costs of such technologies to clients, (xii) AI and other emerging technologies will be compatible with our existing systems and technologies, or (xiii) AI and other new technologies will not result in significant legal and other liabilities, challenges, regulatory, reputational or operational issues, and ethical or other dilemmas.
Our Technology segment faces certain risks, including (i) industry consolidation and a highly competitive environment, (ii) downward pricing pressure, (iii) data breaches, (iv) technology changes and obsolescence, including AI and machine learning, and (v) failure to protect intellectual property (“IP”) used by the segment, which individually or together could cause the financial results and prospects of this segment and the Company to decline.
There is no assurance that we will not incur losses related to cyber incidents or malicious data breaches from external or internal sources in the future.
As of December 31, 2025, we are not aware of any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, that have materially affected us, including our business strategy, results of operations or financial condition, or that we believe are reasonably likely to have such an effect over the long term.
Our operations involve financial and business risks that differ among the U.S. and the different foreign jurisdictions in which we operate including: (i) cultural and language differences; (ii) various levels of FTI Consulting “brand” recognition; (iii) different employment laws and rules, employment or service contracts, compensation methods, and social and cultural factors that could result in employee turnover, lower utilization rates, higher costs and cyclical fluctuations in utilization that could adversely affect financial and operating results; (iv) foreign currency disruptions and currency fluctuations between the U.S. dollar and foreign currencies that could adversely affect financial and operating results; (v) differing legal and regulatory requirements and other barriers to conducting business; (vi) difficulties resolving the collection of receivables when legal proceedings are necessary; (vii) difficulties in managing our non-U.S. operations, including client relationships, in certain locations; (viii) disparate systems, policies, procedures and processes; (ix) failure to comply with the Foreign Corrupt Practices Act and anti-bribery laws of other jurisdictions; (x) higher operating costs; (xi) longer sales and/or collections cycles; (xii) potential restrictions or adverse tax consequences resulting from the repatriation of foreign earnings, such as trapped foreign losses and importation or withholding taxes; (xiii) different or less stable political and/or economic environments; (xiv) wars and other geopolitical conflicts; (xv) conflicts between and among the U.S. and countries in which we conduct business, including those arising from trade disputes or disruptions, the termination or suspension of treaties, or boycotts; (xvi) civil disturbances or other catastrophic events that reduce business activity; (xvii) political interference with our ability to conduct business in the applicable jurisdiction; (xviii) impact of public health crises, including varying governmental responses and requirements, client impacts and travel restrictions; (xix) failure to meet evolving governmental or client-related standards and requirements pertaining to sustainability and corporate responsibility-related issues; and (xx) physical risks associated with climate change, including rising temperatures, severe storms, energy disruptions, fires or wildfires, flooding and rising sea levels, among others.
For example, to the extent the expansion of Section 162(m) of the U.S.
Internal Revenue Code, which will become effective for the Company’s year ending December 31, 2027, reduces the amount of tax deductions available to us, our income tax expense would increase, which would reduce our net income.
Due to the global nature of our business, we are exposed to a variety of physical risks that may be exacerbated by climate change, including extreme temperatures, severe storms, energy disruptions, fires or wildfires, floods and rising sea levels, among others, all of which are beyond our control.
There has also been increased regulation as well as focus from governmental organizations, and our investors, clients and employees, as well as other stakeholders and the media (including social media), on environmental- and sustainability-related issues.
Governments and regulators in the U.S. and around the world have been enacting or revising laws and regulations regarding these issues and their priorities or requirements may not be reconcilable.
Any failure to comply with U.S. federal and state and international laws and regulations or court decisions, or to meet the evolving and disparate expectations of our investors, other stakeholders and interested parties, and the media (including social media), could result in legal or regulatory proceedings against us, increased adverse public scrutiny, client dissatisfaction, reputational harm, employee disenfranchisement, increased employee turnover and other challenges in retaining, recruiting and hiring employees, which may give rise to damages or penalties, and materially adversely affect our business, financial results and stock performance.
Our success and future growth are dependent, in large part, on our ability to keep our supply of skills and human resources in balance with client demand around the world.
Our continued success depends upon our ability to attract and retain professionals who have expertise, good reputations and client relationships critical to maintaining and developing our business.
That is a trend that we see continuing and that has contributed to and in the future is likely to continue to contribute to increased costs of operations and, in some cases, lower operating margins.
There is no assurance we will be able to enter into new or extend existing employment agreements with professionals subject to written employment agreements.
These situations have increased, and we expect that they will continue in the future to increase, our costs to retain other professionals at the Company and impact our ability to retain existing clients and win new engagements.
From time to time we may decide that we cannot or should not accept an engagement from an existing or prospective client or represent multiple clients in connection with the same or competitive engagements.
In addition, on occasion, we may decide that we should or must resign from a client engagement.
Acquisitions also may involve a number of special financial, business and operational risks, such as: (i) difficulties in integrating differing corporate cultures and management styles; (ii) disparate policies and practices; (iii) client relationship issues; (iv) decreased utilization during the integration process; (v) loss of key existing or acquired personnel; (vi) increased costs to improve or coordinate managerial, operational, financial and administrative systems; (vii) dilutive issuances of equity securities, including convertible debt securities, to finance acquisitions; (viii) the assumption of legal liabilities; (ix) future earn-out payments or other price adjustments; (x) potential future write-offs relating to the impairment of goodwill or other acquired intangible assets or the revaluation of assets; (xi) difficulty or inability to collect receivables; and (xii) undisclosed liabilities.
In some cases, different management practices and policies may lead to workplace dissatisfaction on the part of professionals who join our Company following an acquisition.
Some professionals of an acquired company may choose not to join our Company or leave after joining us.
Our senior unsecured bank revolving credit facility (“Credit Facility”), or our other indebtedness outstanding from time to time, contains or may contain operating covenants that may, subject to exceptions, limit our ability and the ability of our subsidiaries to, among other things: (i) create, incur or assume certain liens; (ii) make certain restricted payments, investments and loans; (iii) create, incur or assume additional indebtedness or guarantees; (iv) create restrictions on the payment of dividends or other distributions to us from our restricted subsidiaries; (v) engage in M&A transactions, consolidations, sale-leasebacks, joint ventures, and asset and security sales and dispositions; (vi) pay dividends or redeem or repurchase our capital stock; (vii) alter the business that we and our subsidiaries conduct; (viii) engage in certain transactions with affiliates; (ix) modify the terms of certain indebtedness; (x) prepay, redeem or purchase certain indebtedness; and (xi) make material changes to accounting and reporting practices.

and 7 more.

Gone since FY2024

RISK FACTORS All of the following risks could materially and adversely affect our business, prospects, financial condition and results of operations.
In addition to the risks discussed below and elsewhere in this Annual Report, other risks and uncertainties not currently known to us or that we currently consider immaterial could, in the future, materially and adversely affect our business, prospects, financial condition and financial results.
Some of the factors, events and contingencies discussed below may have occurred in the past, but the disclosures below are not representations as to whether or not the factors, events or contingencies have occurred in the past, and instead reflect our beliefs and opinions as to the factors, events, or contingencies that could materially and adversely affect us in the future.
These include: (i) fluctuations in U.S. and/or global economies, including economic downturns or recessions and the strength and rate of any general economic recoveries; (ii) the U.S. or global financial markets and the availability, costs, and terms of credit and credit modifications, including interest levels and inflationary pressures; (iii) level of leverage incurred by countries or businesses; (iv) M&A activity; (v) frequency and complexity of significant commercial litigation; (vi) overexpansion by businesses causing financial difficulties; (vii) business and management crises, including the occurrence of alleged fraudulent or illegal activities and practices; (viii) new and complex laws and regulations, repeals of existing laws and regulations or changes of enforcement of laws, rules and regulations, including antitrust/competition reviews of proposed M&A transactions; (ix) other economic, geographic or political factors, including wars and other geopolitical conflicts; (x) widespread public health crises, including epidemics and pandemics and government restrictions or regulations enacted in response thereto, or employees’ refusal to adhere to such restrictions; and (xi) general business or other conditions in the U.S. and other jurisdictions in which we conduct business or our employee population resides.
On the other hand, those same factors may cause one or more of our other segments and practices, such as our antitrust & competition practice in Economic Consulting, to experience reduced demand.
Technology — The settlement of litigation; a decline in volume and complexity of litigation proceedings and governmental investigations; a decline in volume and the timing of M&A activities and reduced or less aggressive enforcement of antitrust and competition regulations; the more rapid and successful integration of new and emerging technologies in client offerings, such as AI or machine learning, by competitors, or the availability and engagement of independent consultants, which this segment, more than our other segments, relies on for staffing e-discovery and certain other types of client engagements.
Our segments may face risks of fee non-payment, clients may seek to renegotiate existing fees and contract arrangements, and may not accept billable rate or price increases, which could result in loss of engagements, fee write-offs, reduced revenues and less profitable business.
Our segments and practices could suffer competitive, reputational and business harm or increased liability arising from the rapid introduction, deployment, evolution and use of new technologies, including AI and machine learning.
Our services are extremely complicated and differ materially among our segment and practice offerings.
As a result, the benefits and risks of adopting and implementing new and emerging technologies, such as AI and machine learning in their many forms, necessitates, in most cases, our review and analysis of such technology and its risks and benefits on a service-by-service basis.
The adoption of technologies, such as AI and machine learning, may require the investment of significant capital, time and resources.
In addition, the adoption and deployment of AI, machine learning and other new and emerging technologies by competitors more rapidly or successfully than we do could materially adversely affect our competitive position and financial results.
New technologies, such as AI and machine learning, continue to evolve and as a result risks continue to be unknown or uncertain.
There is no assurance that (i) we can successfully develop and deploy AI or other technologies in our business, (ii) such technologies will improve and enhance our services, operations or profitability, (iii) clients will accept the incorporation of such technology in our services, (iv) we can successfully market the use of these technologies to prospective clients, (vi) we can hire and retain staff with the required specialized knowledge and skills to utilize these technologies, (vi) new cybersecurity and other threats and incidents will not arise, (vii) we can identify, mitigate or recover from cybersecurity or other adverse events that occur, (viii) we can protect and maintain the privacy of our employees and confidential and proprietary information, (ix) governmental regulation will be adopted and what such requirements will be, (x) material additional monetary and time expenditures will not be required, (xi) we can pass on costs of such technologies to clients, (xii) we can integrate other technologies we use with AI, or (xiii) AI and machine learning and other new technologies will not result in significant legal and other liabilities, challenges, regulatory or operational issues, and ethical or other dilemmas.
In addition, AI and other technologies that are open source and available for no or low cost could result in low barriers to development and utilization, and additional competition from third parties.
Our Technology segment faces certain risks, including (i) industry consolidation and a highly competitive environment, (ii) downward pricing pressure, (iii) data breach, (iv) technology changes and obsolescence, including AI and machine learning, and (v) failure to protect intellectual property (“IP”) used by the segment, which individually or together could cause the financial results and prospects of this segment and the Company to decline.
There is no assurance that we will not incur losses related to cyber incidents or malicious data breach from external or internal sources in the future.
As of December 31, 2024, we are not aware of any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, that have materially affected us, including our business strategy, results of operations or financial condition, or that we believe are reasonably likely to have such an effect over the long term.
Our operations involve financial and business risks that differ among the U.S. and the different foreign jurisdictions in which we operate including: (i) cultural and language differences; (ii) various levels of FTI Consulting “brand” recognition; (iii) different employment laws and rules, employment or service contracts, compensation methods, and social and cultural factors that could result in employee turnover, lower utilization rates, higher costs and cyclical fluctuations in utilization that could adversely affect financial and operating results; (iv) foreign currency disruptions and currency fluctuations between the U.S. dollar and foreign currencies that could adversely affect financial and operating results; (v) differing legal and regulatory requirements and other barriers to conducting business; (vi) difficulties resolving the collection of receivables when legal proceedings are necessary; (vii) difficulties in managing our non-U.S. operations, including client relationships, in certain locations; (viii) disparate systems, policies, procedures and processes; (ix) failure to comply with the FCPA and anti-bribery laws of other jurisdictions; (x) higher operating costs; (xi) longer sales and/or collections cycles; (xii) potential restrictions or adverse tax consequences resulting from the repatriation of foreign earnings, such as trapped foreign losses and importation or withholding taxes; (xiii) different or less stable political and/or economic environments; (xiv) wars and other geopolitical conflicts; (xv) conflicts between and among the U.S. and countries in which we conduct business, including those arising from trade disputes or disruptions, the termination or suspension of treaties, or boycotts; (xvi) civil disturbances or other catastrophic events that reduce business activity; (xvii) political interference with our ability to conduct business in the applicable jurisdiction; (xviii) impact of public health crises, including varying governmental responses and requirements, client impacts and travel restrictions; (xix) failure to achieve or maintain a diverse workforce or otherwise meet evolving governmental or client-related standards and requirements pertaining to ESG-related issues; and (xx) physical risks associated with climate change, including rising temperatures, severe storms, energy disruptions, fires or wildfires, flooding and rising sea levels, among others.
We are also exposed to new and changing regulations related to climate change, both in the U.S. and internationally.
The fast pace of changes to regulation in this area can pose compliance challenges, and we may face risks similar to those described above.
Due to the global nature of our business, we are exposed to a variety of physical risks related to climate change, including extreme temperatures, severe storms, energy disruptions, fires or wildfires, floods and rising sea levels, among others, all of which are beyond our control.
There is increased regulation as well as focus from governmental organizations, and our investors, clients and employees, as well as other stakeholders and the media (including social media), on environmental- and sustainability-related issues.
Governments and regulators around the world are increasingly enacting laws and regulations regarding climate change.
In October 2023, California enacted legislation addressing the disclosure of greenhouse gas emissions, climate-related risks, environmental claims, and the use or sale of voluntary carbon offsets.
In January 2023, the EU enacted the Corporate Sustainability Reporting Directive, which will require sustainability reporting across a broad range of topics for both EU and non-EU companies.
Numerous countries have also begun proposing climate-reporting frameworks aligned with the International Sustainability Standards Board standards.
Any failure to comply with U.S. federal and state and international laws and regulations or court decisions, or to meet the evolving expectations of our investors, other stakeholders and interested parties, and the media (including social media), could result in legal or regulatory proceedings against us, increased adverse public scrutiny, client dissatisfaction, reputational harm, employee disenfranchisement, increased employee turnover and other challenges in retaining, recruiting and hiring employees, which may give rise to damages or penalties, and materially adversely affect our business, financial results and stock performance.
Our success and future growth is dependent, in large part, on our ability to keep our supply of skills and human resources in balance with client demand around the world.
Our continued success depends upon our ability to attract and retain professionals who have expertise, a good reputation and client relationships critical to maintaining and developing our business.
That is a trend that we see continuing and that has contributed and in the future is likely to continue to contribute to increased costs of operations and, in some cases, lower operating margins.
There is no assurance we will enter into new or extend existing employment agreements with professionals subject to written employment agreements.
These situations have increased, and we expect that they will continue into the future to increase, our costs to retain other professionals at the Company and impact our ability to retain existing clients and win new engagements.
From time to time we decide that we cannot or should not accept an engagement from an existing or prospective client or represent multiple clients in connection with the same or competitive engagements.
In addition, upon occasion, we decide that we should or must resign from a client engagement.
Acquisitions also may involve a number of special financial, business and operational risks, such as: (i) difficulties in integrating diverse corporate cultures and management styles; (ii) disparate policies and practices; (iii) client relationship issues; (iv) decreased utilization during the integration process; (v) loss of key existing or acquired personnel; (vi) increased costs to improve or coordinate managerial, operational, financial and administrative systems; (vii) dilutive issuances of equity securities, including convertible debt securities, to finance acquisitions; (viii) the assumption of legal liabilities; (ix) future earn-out payments or other price adjustments; (x) potential future write-offs relating to the impairment of goodwill or other acquired intangible assets or the revaluation of assets; (xi) difficulty or inability to collect receivables; and (xii) undisclosed liabilities.
In some cases, different management practices and policies may lead to workplace dissatisfaction on the part of professionals who join our Company.
Some professionals may choose not to join our Company or leave after joining us.
Our senior secured bank revolving credit facility (“Credit Facility”), or our other indebtedness outstanding from time to time, contains or may contain operating covenants that may, subject to exceptions, limit our ability and the ability of our subsidiaries to, among other things: (i) create, incur or assume certain liens; (ii) make certain restricted payments, investments and loans; (iii) create, incur or assume additional indebtedness or guarantees; (iv) create restrictions on the payment of dividends or other distributions to us from our restricted subsidiaries; (v) engage in M&A transactions, consolidations, sale-leasebacks, joint ventures, and asset and security sales and dispositions; (vi) pay dividends or redeem or repurchase our capital stock; (vii) alter the business that we and our subsidiaries conduct; (viii) engage in certain transactions with affiliates; (ix) modify the terms of certain indebtedness; (x) prepay, redeem or purchase certain indebtedness; and (xi) make material changes to accounting and reporting practices.
If we violate any applicable covenants and are unable to obtain waivers, our agreements governing our indebtedness or other applicable agreement could be declared in default and could be accelerated, which could permit, in the case of secured debt, the lenders to foreclose on our assets securing the debt thereunder.

and 6 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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