The Hackett Group Announces Fourth Quarter 2025 Results

The Hackett Group, Inc. (NASDAQ:HCKT), a leading generative artificial intelligence (Gen AI) consultancy and digital transformation firm that enables Digital World Class^® performance, today announced its financial results for the fourth quarter, which ended on December 26, 2025.

"We reported operating results with revenues and adjusted earnings per share that were above and at the high end of our guidance, respectively. While we cannot control short-term market sentiment or demand volatility, we can - and do - control the intrinsic value we create," stated Ted A. Fernandez, Chairman and CEO of The Hackett Group, Inc. "The current environment also creates the opportunity for new leaders to emerge. Over the past two years, we have been systematically expanding our suite of Gen AI enabled platforms to lead in the rapidly emerging Agentic Enterprise era. By embedding our IP into our new platforms and models, we believe we will be able to generate new revenue with higher margins, in entirely new ways that allow us to deliver breakthrough ROI. We are looking forward to 2026!"

Financial Highlights

• Total revenue in the fourth quarter of 2025 was $75.8 million and revenue before reimbursements was $74.8 million, which exceeded the high end of our guidance. This compares to total revenue of $79.2 million and revenue before reimbursements of $77.5 million in the fourth quarter of the prior year.
• GAAP diluted earnings per share was $0.21 in the fourth quarter of 2025, as compared to $0.12 in the fourth quarter of 2024. 2025 fourth quarter GAAP net income was impacted by non-cash compensation expense recognized in association with the stock price award program announced in September 2024 of $1.8 million, or $0.08 per diluted earnings per share. In addition, 2025 GAAP net income was impacted by the LeewayHertz acquisition related non-cash compensation and related expenses of $1.1 million, or $0.04 per diluted earnings per share.
• Adjusted diluted earnings per share, a non-GAAP measure, for the fourth quarter of 2025 was $0.40, which was at the high end of our guidance, as compared to $0.47 in the fourth quarter of 2024. Adjusted financial information is provided to enhance the understanding of the Company's financial performance and is reconciled to the Company's GAAP information in the accompanying tables.
• During the fourth quarter of 2025, the Company completed its "Dutch auction" tender offer through which it repurchased 2.0 million shares for a total cost of $41.2 million, or $20.29 per share, including transaction related fees; lowering the outstanding shares by approximately 7%. As of the end of the fourth quarter, the Company's remaining share repurchase program authorization was $11.4 million.
• As of December 26, 2025, the Company's cash balances were $18.2 million, with $76.0 million outstanding on the Company's credit facility. Cash flows from operations were $19.1 million in the fourth quarter of 2025, as compared to $20.6 million in the fourth quarter of 2024.
• Subsequent to the end of the fourth quarter, the Company's Board of Directors approved an additional $13.6 million under its share repurchase program and declared the first quarterly dividend of $0.12 per share for its shareholders of record on March 20, 2026, to be paid on April 3, 2026.

Business Outlook for the First Quarter of 2026

Based on the Company's current outlook:

• The Company estimates total revenue before reimbursements for the first quarter of 2026 will be in the range of $70.5 million to $72.0 million.
• The Company estimates adjusted diluted earnings per share for the first quarter of 2026 to be in the range of $0.34 and $0.36, assuming a GAAP effective tax rate of 26.3%.

Conference Call and Webcast Details

• On Tuesday, February 17, 2026, senior management will discuss fourth quarter results in a conference call at 5:00 P.M. ET. The number for the conference call is (800) 593-0486, [Passcode: Fourth Quarter]. For International callers, please dial (517) 308-9371. Please dial in at least 5-10 minutes prior to start time. If you are unable to participate on the conference call, a rebroadcast will be available beginning at 8:00 P.M. ET on Tuesday, February 17, 2026 and will run through 5:00 P.M. ET on Tuesday, March 3, 2026. To access the rebroadcast, please dial (800) 568-3652. For International callers, please dial (203) 369-3289.
• In addition, The Hackett Group^® will also be webcasting this conference call live. To participate, simply visit https://www.thehackettgroup.com approximately 10 minutes prior to the start of the call and click on the conference call link provided. An online replay of the call will be available after 8:00 P.M. ET on Tuesday, February 17, 2026 and will run through 5:00 P.M. ET on Tuesday, March 3, 2026. To access the replay, visit www.thehackettgroup.com.

Use of Non-GAAP Financial Measures

The Company provides adjusted earnings results (which excluded non-cash stock-based compensation expense, acquisition-related non-cash stock-based compensation expense, legal settlement and related costs and includes a GAAP tax rate) as a complement to results provided in accordance with Generally Accepted Accounting Principles (GAAP). These non-GAAP results are provided to enhance the users' overall understanding of the Company's current financial performance and its prospects for the future. The Company believes the non-GAAP results provide useful information to both management and investors and by excluding certain expenses that it believes are not indicative of its core operating results. The non-GAAP measures are included to provide investors and management with an alternative method for assessing operating results in a manner that is focused on the performance of its ongoing primary operations and to provide a consistent basis for comparison between quarters. Further, these non-GAAP results are one of the primary indicators management uses for planning and forecasting. The presentation of this additional non-GAAP information should be considered in addition to, and not as a substitute for or superior to, any results prepared in accordance with GAAP. See the reconciliation of actual results titled "Reconciliation of GAAP to Non-GAAP Measures" in the accompanying tables.

The Company believes that the presentation of non-GAAP financial information on a forward-looking basis, including the guidance contained in this release, provides important supplemental information to management and investors regarding its anticipated results of operations. The Company is unable to provide a reconciliation of GAAP measures to corresponding forward-looking non-GAAP measures without unreasonable effort due to the high variability and low visibility of most of the items that have been excluded from these non-GAAP measures. For example, non-cash stock-based compensation expense is impacted by the Company's future hiring needs, the type and volume of equity awards necessary for such future hiring, and the price at which the Company's stock will trade in those future periods. In addition, the provision or benefit for income taxes is impacted by non-recurring income tax adjustments, valuation allowance on deferred tax assets, and the income tax effect of non-GAAP exclusions. The effects of these reconciling items may be significant, as the items that are being excluded are difficult to predict.

About The Hackett Group®

The Hackett Group, Inc. (NASDAQ:HCKT) is a Gen AI strategic consulting and digital transformation firm that enables Digital World Class® performance. Using Hackett AI XPLR™, ZBrain™, XT™, AIXelerator™, AskHackett™ and Quantum Leap® platforms, the company's experienced professionals and engineers help organizations realize the power of Gen AI from ideation through implementation to achieve quantifiable, breakthrough results with unprecedented speed, allowing it to be key architects of their Gen AI journey. The company's expertise is grounded in unparalleled best practices insights from enterprise performance benchmarks from the world's leading businesses – including 97% of the Dow Jones Industrials, 90% of the Fortune 100, 68% of the DAX 40 and 53% of the FTSE 100. Visit us at www.thehackettgroup.com.

Trademarks

The Hackett Group®, quadrant logo, Digital World Class® and Quantum Leap® are the registered marks of The Hackett Group®.

Cautionary Statement Regarding "Forward-Looking" Statements

This release contains "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Statements including without limitation, words such as "expects," "anticipates," "intends," "plans," "believes," seeks," "estimates," or other similar phrases or variations of such words or similar expressions indicating, present or future anticipated or expected occurrences or outcomes are intended to identify such forward-looking statements. Forward-looking statements are not statements of historical fact and involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements to be materially different from the results, performance or achievements expressed or implied by the forward-looking statements. Factors that could impact such forward-looking statements include, among others, changes in worldwide and U.S. economic conditions that impact business confidence and the demand for our products and services, our ability to transition our capabilities to support generative artificial intelligence (AI)-related consulting services and solutions, our ability to effectively integrate acquisitions, including the Leeway acquisition, into our operations, our ability to manage joint ventures and successfully cooperate with our joint venture partners, our ability to retain existing business, our ability to attract additional business, our ability to effectively market and sell our product offerings and other services, the timing of projects and the potential for contract cancellation by our customers, changes in expectations regarding the business consulting and information technology industries, our ability to attract and retain skilled employees, possible changes in collections of accounts receivable due to the bankruptcy or financial difficulties of our customers, risks of competition, price and margin trends, foreign currency fluctuations, the impact of the geopolitical conflict involving Russia and Ukraine and in the Middle East on our business and changes in general economic conditions, interest rates and our ability to obtain additional debt financing if needed as well as other risk detailed in The Hackett Group's reports filed with the United States Securities and Exchange Commission. The Hackett Group does not undertake any duty to update this release or any forward-looking statements contained herein.

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Robert A. Ramirez, CFO, 305-375-8005 or [email protected]