CRA International: Record Q2, Raised Guidance, and a Bullish Bet on Data-Center-Driven Demand

Broad-based growth across eight practices, led by Energy and Life Sciences, pushes revenue to an all-time high and prompts management to expand its credit facility.

CRAI · Earnings Call · 2026-08-06

A record quarter built on breadth

CRA International capped off the first half of fiscal 2026 with its strongest quarter ever. Revenue hit $210.8M, a 12.8% year-over-year increase, and non-GAAP EBITDA grew 15.3%. As CEO Paul Maleh put it, “Broad-based contributions once again characterized CRA's financial performance, reflecting both the quality and the depth of the portfolio.” — Paul Maleh, Chief Executive Officer · 2026-08-06 Eight practices grew year-over-year, accounting for 95% of revenue, and six posted double-digit growth. The breadth is notable—this is not a one-practice story. Life Sciences and Energy both grew north of 20%, while M&A activity reached a record $1.6 trillion in Q2, powering yet another record quarter for the Antitrust & Competition Economics practice. The management consulting segment, up roughly 25–26%, was a key driver. In the Q&A, Maleh explained the persistence: "Life Sciences and the Energy practice both grew in excess of 20% year-over-year. They have been persistent now for the last 2 or 3 quarters... the utility industry right now in the United States is experiencing change like it has never seen before." “The utility industry right now in the United States is experiencing change like it has never seen before.” — Paul Maleh, Chief Executive Officer · 2026-08-06 This isn't just a one-quarter spike—the pipeline of new project opportunities is also at record levels, with double-digit growth in lead flow and originations.

AI and data centers: demand amplifier, not just efficiency tool

A recurring theme on the call was the role of artificial intelligence. Maleh described it in stark terms:

AI is a productivity enhancer and a demand amplifier. Being a demand amplifier doesn't mean that this is all revenue that we have created because we use AI tools. Sometimes it's the complexity that AI is introducing into our markets.
Paul Maleh, Chief Executive Officer · 2026-08-06

This complexity is showing up in Forensic Services, which grew over 20% and set a quarterly record, driven by cyber incident response work as hackers become more sophisticated and corporate America more reliant on digital infrastructure. Similarly, electric system operators and utilities are turning to CRA for data-center load forecasting and grid planning—an area where CRA's Energy practice is winning multiyear engagements, including one with PJM. The data center theme is also echoing across the broader market. In the global keyword trajectory, “data center” and related terms like “AI data centers” appear in the top decile of movers for several quarters, and CRA is clearly riding that wave. Management noted that inbound demand from utilities, private equity, and tech companies "doesn't seem to be dissipating."

Capital deployment and a confident outlook

Alongside the operating strength, CRA made two notable capital moves. It expanded its credit facility to $400 million, replacing the existing one that was set to mature in 2027. Chad Holmes explained: “The expanded facility... reflects both CRA's growth since the prior facility was established in 2022 and management's bullish views on CRA's prospect in the years ahead.” — Chad Holmes, Unknown · 2026-08-06 The company also returned $31.4 million to shareholders in Q2, including $27.8 million of buybacks at an average price of $144 per share—a signal that management believes the stock is undervalued, especially given it still has $16.6 million available under the repurchase program. These moves are backed by a raised revenue guide: full-year revenue guidance now stands at $805–$820 million, up from $785–$805 million. Management reaffirmed the non-GAAP EBITDA margin range of 12–13%, though they noted the increase in non-cash forgivable loan amortization—expected to climb ~$15M this year—will continue to pressure reported margins. Senior talent additions, including nearly 30 VPs hired in 2025, are ramping faster than expected, and Maleh said the medium-term headcount growth should return to mid-single digits. A key nuance: the fundamentals show operating margin dipped to 9.0% in Q2 from 11.9% a year ago, driven by those forgivable loan amortization expenses and higher SG&A. But on an EBITDA-plus-amortization basis, the story is far more positive. The credit expansion provides flexibility for continued investment in AI tools and talent to meet the demand that management sees ahead. Overall, this quarter confirms that CRA has entered a new gear—growing at a double-digit clip across nearly all practices, with a clear line of sight into both consulting and litigation demand. The raised guidance and facility expansion reflect confidence, while the active buyback underscores a belief that the market hasn't yet fully priced in the company's trajectory. As Maleh admitted, "We are forecasting off peaks," but the peak keeps getting higher.