Huron Consulting Group Q2 Earnings Call Highlights

Key Points

• Record second-quarter performance: Huron’s RBR increased 15.7% year over year to $465.6 million, while adjusted EBITDA rose to $72.6 million and adjusted EPS reached $2.46.
• Full-year outlook raised: The company now expects 2026 RBR of $1.85 billion to $1.89 billion and adjusted EPS of $9.00 to $9.40, supported by strong bookings, backlog, organic growth and the RelateCare acquisition.
• Healthcare, commercial and AI demand led growth: Healthcare RBR grew 17.4% and commercial RBR rose 24.6%; digital bookings increased more than 20% in the first half, with over 60% involving direct or AI-enabled work.

Huron Consulting Group NASDAQ: HURN reported record revenue before reimbursable expenses, or RBR, for the second quarter of 2026, supported by double-digit organic growth, demand across its three operating segments and contributions from acquisitions.

Second-quarter RBR rose 15.7% year over year to $465.6 million, including 10.8% organic growth, Chief Financial Officer John Kelly said on the company’s earnings call. Net income increased to $31.2 million, or $1.91 per diluted share, from $19.4 million, or $1.09 per diluted share, a year earlier.

Adjusted EBITDA climbed to $72.6 million from $60.6 million, while adjusted EBITDA margin expanded to 15.6% of RBR from 15.1%. Adjusted net income totaled $40.2 million, or $2.46 per diluted share, compared with $33.7 million, or $1.89 per diluted share, in the prior-year quarter.

Higher Full-Year Outlook

CEO Mark Hussey said the company’s first-half performance, bookings growth, backlog and pipeline supported an increase in full-year guidance. Huron raised and narrowed its 2026 RBR outlook to $1.85 billion to $1.89 billion, representing 12% growth at the midpoint compared with 2025.

The company maintained its adjusted EBITDA margin outlook of 14.5% to 15% of RBR and increased its adjusted non-GAAP earnings-per-share guidance to $9 to $9.40. The midpoint of the EPS outlook would represent a 17% increase from 2025, Hussey said.

Huron expects its June acquisition of RelateCare, a provider of AI-enabled clinical and patient-access managed services, to contribute about $30 million in RBR during 2026 and approximately $0.10 in adjusted EPS. RelateCare’s results were included in the healthcare segment beginning with the partial second quarter following the June 3 closing, Kelly said.

Segment Results Led by Healthcare and Commercial

Healthcare, which accounted for 50% of second-quarter RBR, generated a record $232.3 million in RBR, up 17.4% from a year earlier. The figure included $10.1 million of incremental RBR from RelateCare, Eclipse Insights and AXIOM Systems. Excluding acquisitions, healthcare grew 12% organically, Hussey said.

Healthcare operating income margin was 30.1%, essentially unchanged from the prior-year quarter. Hussey cited demand for managed services, performance improvement, strategy, financial advisory and digital offerings. Healthcare managed services grew 64% year over year, including 43% organic growth, according to the company.

The education segment reported RBR of $139.4 million, up 7.8%, driven primarily by digital and managed-services demand. Its operating income margin rose to 26.8% from 25%, as revenue growth outpaced related professional compensation costs and project costs declined, partly offset by higher performance-bonus expense.

Commercial RBR increased 24.6% to $94 million, including $9.2 million from the Treliant and Wilson Perumal acquisitions. Organic commercial growth was 12.2%, driven by demand for financial advisory and strategy services. Commercial operating income margin increased to 21% from 16.6%.

For the full year, Huron now expects healthcare RBR growth in the mid-teens and education growth in the mid- to upper-single-digit percentage range. It retained its expectation for low-teens commercial RBR growth. Kelly said commercial growth in the second half will face pressure from annualizing acquisitions made in late 2025 and the expected wind-down of several distressed financial-advisory projects.

AI Bookings and Digital Demand

Hussey said artificial intelligence is becoming a larger contributor to the company’s digital-services opportunity. Total bookings for Huron’s digital capability increased more than 20% in the first half of 2026 from a year earlier, with more than 60% of bookings involving direct AI work or delivery substantially enabled by Huron’s AI tools. Comparable projects represented about 35% of total bookings in the first half of 2025.

Digital RBR rose 9% year over year and sequentially in the second quarter, reaching a record level. Kelly said the company expects double-digit digital growth in the second half, led in part by healthcare clients investing in data foundations, digital platforms, automation and AI projects.

Hussey said Huron is using AI in its own delivery processes as well as in client engagements. In healthcare, its clinical intelligent automation offering is intended to shorten the time required to identify clinical performance-improvement opportunities from days or weeks to hours. The company also cited internal uses in contracting, billing and collections, and sales research.

During the question-and-answer session, Hussey said AI opportunities are not entirely incremental because clients may shift technology spending among priorities. However, he said Huron has not experienced material AI-related price compression and remains bullish on the technology’s longer-term potential.

Cash Flow, Buybacks and Hiring

Cash flow from operations increased to $120.5 million in the second quarter from $80.1 million a year earlier. After $9.1 million in capital expenditures, free cash flow was $111.3 million. Huron maintained its full-year free-cash-flow forecast of $180 million to $220 million, excluding non-cash stock compensation.

The company spent $53.1 million during the quarter to repurchase about 438,000 shares. Year-to-date repurchases totaled $208.6 million, or approximately 1.6 million shares, representing 9% of shares outstanding at the start of the year.

Huron ended the quarter with $834 million of debt and $31.2 million of cash, resulting in net debt of $802.8 million. Its leverage ratio declined to 2.8 times adjusted EBITDA at June 30 from 3.1 times at March 31. Kelly said the company remains committed to reducing leverage to between two and 2.5 times by year-end.

Management also said it plans to continue hiring in areas with elevated utilization. Kelly said consulting headcount growth for the full year could land in the upper-single-digit percentage range, below the company’s expected revenue growth rate.

About Huron Consulting Group (NASDAQ:HURN)

Huron Consulting Group NASDAQ: HURN is a global professional services firm that advises organizations across a range of industries on strategy, operations and technology. Founded in 2002 and headquartered in Chicago, the company helps clients address complex business challenges such as performance improvement, digital transformation and organizational change. Huron's consultants work alongside executive leadership teams to develop and implement tailored solutions that drive growth, increase efficiency and manage risk.

Huron's service offerings encompass business and financial advisory, healthcare performance improvement, life sciences consulting, higher education and research lifecycle support, as well as legal and regulatory consulting.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.