CRA (NASDAQ:CRAI) Surpasses Q4 CY2025 Revenue Forecasts

CRA International Surpasses Q4 Revenue Projections

CRA International (NASDAQ: CRAI), a leading economic consulting firm, delivered fourth-quarter results for fiscal year 2025 that outperformed Wall Street’s revenue forecasts. The company posted $197 million in sales, marking an 11.6% increase compared to the same period last year. For the full year, CRA anticipates revenue to reach $795 million at the midpoint, which is 2.9% higher than analysts’ consensus. Adjusted earnings per share came in at $2.06, closely matching market expectations.

Q4 2025 Performance Highlights

• Revenue: $197 million, surpassing analyst expectations of $190.5 million (11.6% year-over-year growth, 3.4% above estimates)
• Adjusted EPS: $2.06, in line with the anticipated $2.07
• Adjusted EBITDA: $24.35 million, exceeding projections of $23.41 million (12.4% margin, 4% above estimates)
• Operating Margin: 10.5%, a decrease from 12.1% in the prior year’s quarter
• Free Cash Flow Margin: 29.9%, down from 39% a year ago
• Market Cap: $1.05 billion

“For the eighth year in a row, CRA has set a new record for annual revenue,” commented Paul Maleh, President and CEO of CRA.

About CRA International

CRA International is frequently engaged for complex, high-value assignments with significant financial stakes. The firm offers economic, financial, and management consulting services to corporations, law firms, and government agencies, supporting litigation, regulatory matters, and strategic business decisions.

Revenue Trends

Consistent revenue growth is a key indicator of a company’s strength. While any business can have a strong quarter, sustained expansion over time is a sign of quality.

With $751.6 million in revenue over the past year, CRA is considered a smaller player in the business services sector. While this can present challenges compared to larger rivals, it also provides more room for rapid growth.

Over the past five years, CRA has achieved an annualized revenue growth rate of 8.1%, outpacing many of its peers in the industry.

Looking at more recent performance, CRA’s two-year annualized revenue growth stands at 9.8%, indicating an acceleration in demand compared to its five-year average.

This quarter, the company’s revenue grew 11.6% year over year, with the $197 million result beating analyst forecasts by 3.4%.

However, analysts predict that revenue will remain steady over the next year, suggesting that CRA may face headwinds in maintaining its recent growth momentum. Despite this, the company continues to demonstrate solid financial health in other areas.

Profitability and Margins

Over the past five years, CRA has maintained an average operating margin of 10.1%, outperforming the broader business services sector. The company’s operating margin has improved by 1.2 percentage points during this period, reflecting the benefits of sales growth and operational efficiency.

In the latest quarter, CRA reported an operating margin of 10.5%, a slight decline of 1.6 percentage points from the previous year. This modest decrease suggests that the company’s cost structure remains well-managed.

Earnings Per Share Growth

Tracking long-term changes in earnings per share (EPS) helps assess whether a company’s growth is translating into profitability. CRA’s EPS has grown at a compound annual rate of 19.7% over the past five years, significantly outpacing its revenue growth. This indicates that the company has become more profitable on a per-share basis as it has expanded.

Several factors have contributed to this improvement, including a 1.2 percentage point increase in operating margin over five years and a 16.2% reduction in share count, both of which have boosted EPS growth relative to revenue.

Examining shorter-term trends, CRA’s two-year annualized EPS growth of 22.6% exceeds its five-year average, highlighting accelerating profitability.

For Q4, adjusted EPS reached $2.06, up from $2.03 a year earlier and closely aligned with analyst expectations. Looking ahead, Wall Street expects CRA’s full-year EPS to rise 8.4% to $8.22 over the next 12 months.

Summary and Outlook

CRA’s latest quarter featured revenue and guidance that surpassed market expectations, making for a solid performance overall. The company’s shares remained steady at $160.26 following the announcement.

Is CRA a compelling investment right now? While the recent results are encouraging, they represent just one aspect of the company’s long-term prospects. Assessing both business quality and valuation is essential when considering a stock purchase.