Huron Consulting Group Inc. (HURN) - Q2 2026 10-Q Summary
Business Context and Reporting Period
This report covers the quarterly period ended June 30, 2026. Huron Consulting Group Inc. is a global professional services firm operating in three segments: Healthcare, Education, and Commercial. The company delivers services through two principal capabilities: Consulting and Managed Services and Digital. The reporting period includes the impact of the June 2026 acquisition of RelateCare, an AI-enabled clinical and patient access solutions provider.
Key Financial Metrics
| Metric | Q2 2026 | Q2 2025 | YTD 2026 | YTD 2025 |
|---|---|---|---|---|
| Total Revenues | $475.0 million | $411.8 million | $926.8 million | $815.9 million |
| Revenues Before Reimbursable Expenses (RBR) | $465.6 million | $402.5 million | $909.3 million | $798.2 million |
| Operating Income | $50.2 million | $45.7 million | $86.8 million | $78.4 million |
| Net Income | $31.2 million | $19.4 million | $54.5 million | $44.0 million |
| Diluted EPS | $1.91 | $1.09 | $3.22 | $2.42 |
| Adjusted Diluted EPS | $2.46 | $1.89 | $4.16 | $3.57 |
| Adjusted EBITDA Margin (of RBR) | 15.6% | 15.1% | 13.6% | 12.8% |
| Cash and Cash Equivalents | $31.2 million | $24.5 million (Dec 31, 2025) | N/A | |
| Total Debt Outstanding | $834.0 million | $511.0 million (Dec 31, 2025) | N/A | |
| Unused Revolver Capacity | $245.6 million | N/A | N/A |
Material Changes vs. Prior Period
- Revenue Growth: RBR increased 15.7% in Q2 2026 compared to Q2 2025, driven by organic growth of 10.8% and $19.5 million in incremental revenue from acquisitions. The Commercial segment saw the highest growth at 24.6%, followed by Healthcare at 17.4%.
- Profitability: Net income surged 60.8% year-over-year. This increase is partially attributable to the absence of an $8.2 million non-cash credit-related impairment charge on a convertible debt investment that occurred in Q2 2025.
- Debt Levels: Total borrowings increased significantly from $511.0 million at year-end 2025 to $834.0 million as of June 30, 2026. This increase funded operations, share repurchases, and the RelateCare acquisition.
- Headcount: Total revenue-generating professionals increased to 9,248 (up from 6,881 in Q2 2025), with a notable increase in Managed Services professionals due to the RelateCare acquisition.
- Utilization: Utilization rates improved across capabilities, with Consulting at 81.3% and Digital at 81.8% in Q2 2026, compared to 77.0% and 77.8% respectively in Q2 2025.
Guidance, Outlook, and Risks
- Outlook: Management emphasizes a strategy of accelerating growth in Healthcare and Education, expanding the Commercial footprint, and scaling digital capabilities. The company remains committed to margin expansion and returning capital to shareholders.
- Share Repurchases: The company repurchased $53.1 million of stock in Q2 2026. As of June 30, 2026, $92.0 million remains available under the current $900 million authorization.
- Acquisitions: The June 2026 acquisition of RelateCare is expected to strengthen managed services offerings. The company continues to pursue strategic, tuck-in acquisitions.
- Risks: Key risks include the ability to realize benefits from AI, dependence on client renewals, integration of acquired businesses, and potential impairment of goodwill. The company also faces market risks related to interest rates and foreign currency exchange, which are partially hedged.
- Unusual Items: Q2 2026 included a $3.9 million loss related to the remeasurement of contingent consideration liabilities. Q2 2025 included a significant $11.1 million non-cash impairment charge on a convertible debt investment.
Investor Verification Checklist
- Debt Covenants: Verify continued compliance with the Consolidated Leverage Ratio (2.82x as of June 30, 2026) and Interest Coverage Ratio (7.48x) given the increased debt load.
- Acquisition Integration: Monitor the integration progress and revenue contribution of the RelateCare acquisition, which added approximately 1,100 Managed Services professionals.
- Investment Valuations: Review the fair value and credit allowance assumptions for the Shorelight Holdings convertible debt investment ($33.8 million fair value) and the hospital-at-home equity investment ($0.1 million carrying value), which have historically generated non-cash impairments.
- Contingent Consideration: Track the $34.1 million liability for contingent consideration, which is subject to remeasurement based on future financial performance targets.
- Organic Growth: Assess the sustainability of the 10.8% organic RBR growth rate excluding acquisition impacts.