Abstract

CRA International Inc will report quarterly financial results on February 26, 2026 Pre-Market, with consensus anticipating year-over-year gains in revenue and EPS while investors weigh contract mix, cost discipline, and margin resilience into the print.

Market Forecast

Consensus for the current quarter points to revenue of $190.54 million, up 14.23% year-over-year, with EPS estimated at $2.07, a 28.04% year-over-year increase, and EBIT projected at $20.36 million, 19.62% higher year-over-year; based on last quarter’s 29.28% gross profit margin and 6.17% net profit margin, expectations imply stable-to-improving operating leverage to support the earnings trajectory. Time-and-materials, the principal revenue stream, is expected to remain the backbone of the quarter, supported by steady client demand and continued utilization discipline. Fixed-price engagements, while smaller, have the potential to amplify margin outcomes as delivery models scale and project execution strengthens.

Last Quarter Review

CRA International Inc delivered revenue of $185.89 million, a 10.82% year-over-year increase, with a gross profit margin of 29.28%, GAAP net profit attributable to the parent company of $11.47 million, a net profit margin of 6.17%, and adjusted EPS of $2.06, up 16.38% year-over-year. EPS exceeded expectations by $0.26, and EBIT reached $20.92 million, outpacing estimates by $2.43 million, reflecting healthy operating execution against prior-quarter internal and external benchmarks. Time-and-materials contributed $154.30 million last quarter, representing approximately 83.01% of total revenue, while fixed-price engagements generated $31.59 million, shaping the contract mix that underpinned margins and utilization trends.

Current Quarter Outlook

Time-and-Materials: Revenue Anchor and Utilization Levers

Time-and-materials is the primary revenue driver, accounting for $154.30 million last quarter and roughly four-fifths of the overall mix, and it remains central to this quarter’s outlook. In a time-and-materials environment, billable hours, consultant utilization, and realized billing rates form the core revenue equation; management’s operating cadence typically emphasizes staffing alignment with demand and tight oversight of utilization, which can elevate revenue when demand is consistent. With consensus revenue growth at 14.23% year-over-year and EPS growth at 28.04%, the setup implies improved throughput and favorable mix within fee structures, provided that utilization maintains traction and rate realization holds. Operating leverage from existing teams can strengthen EBIT flow-through if wage inflation is matched by pricing discipline and engagement timing aligns with the quarter’s cadence. The balance of client activity across practice areas feeds time-and-materials demand, so any unevenness in project starts or pauses can create intra-quarter variability; this quarter’s key for the segment will be sustaining billable intensity while controlling travel and engagement-related costs to protect the 29.28% gross margin benchmark established last quarter.

Fixed-Price Work: Margin Swing Factor and Delivery Discipline

Fixed-price projects, at $31.59 million last quarter, are smaller in absolute dollars but can act as a meaningful swing factor for margins. Execution quality — specifically project scoping, milestones, and delivery discipline — dictates whether fixed-price engagements contribute to margin expansion or compression; tight project management is essential to hit cost targets and avoid scope creep. If delivery frameworks and oversight are robust, fixed-price can lift gross margins by reducing engagement variability; conversely, underestimating complexity or staffing requirements can pressure margins. For the current quarter, EBIT expectations of $20.36 million, up 19.62% year-over-year, align with a constructive view that fixed-price and time-and-materials together sustain operating efficiency; the calibration of fixed-price performance relative to time-and-materials will define the quarter’s margin narrative. This segment’s impact on EPS will hinge on resource allocation, milestone timing toward period-end, and the extent to which project outcomes permit incremental recognition without sacrificing cost control. If fixed-price work pulls through smoothly, it can amplify the EPS trajectory implied by consensus without requiring unusual cost containment; if project timing slips or costs drift above plan, EBIT could still meet targets through time-and-materials momentum, but EPS sensitivity would rise.

Stock Price Drivers This Quarter: Beat/Miss Dynamics, Contract Mix, and Cost Control

The stock’s near-term reaction will be most sensitive to beat/miss outcomes versus consensus on revenue and EPS, alongside commentary on contract mix stability and cost control. With EPS modeled to expand 28.04% year-over-year and revenue up 14.23%, investors will look for confirmation that last quarter’s operating execution — reflected in the EBIT and EPS surprise — is repeatable, not a one-off. Any upside on utilization and realized rates within time-and-materials can create incremental revenue leverage, while disciplined delivery in fixed-price can drive margin lift; conversely, wage inflation or higher engagement costs without price offsets would constrain flow-through to EBIT. The quarter-on-quarter movement in net profit last period registered a 5.35% decline, so stability or improvement in sequential profitability will be watched closely as a signal of earnings consistency. Share count dynamics can modestly influence EPS print-to-print, but operating drivers — revenue conversion, cost control, and contract execution — remain the primary determinants of whether the company surpasses or lags the consensus trajectory. Management’s commentary on backlog conversion within the current quarter, the pace of new engagements, and the timing of larger matters relative to the period-end will shape how investors recalibrate expectations for the next few quarters.

Analyst Opinions

Across the limited commentary observed within the specified period, the prevailing tone is cautious, emphasizing execution consistency and margin protection over aggressive upside calls. The market’s consensus framework — forecasting revenue of $190.54 million with 14.23% year-over-year growth, EPS of $2.07 up 28.04% year-over-year, and EBIT of $20.36 million growing 19.62% year-over-year — reflects constructive fundamentals but also embeds the expectation that last quarter’s operating discipline continues without relying on atypical cost measures. The cautious stance centers on three themes: first, confirmation that time-and-materials utilization and realized rates can sustain double-digit revenue growth; second, the sensitivity of fixed-price margins to project execution and scope control; and third, the degree to which quarterly timing of engagements influences sequential net profit, given last quarter’s 5.35% quarter-on-quarter decline in net profit. In this context, the majority view avoids extrapolating outsized upside and instead looks for steady delivery in the core metrics — revenue, EBIT, and EPS — aligned with consensus, along with detailed visibility into contract mix and cost trajectories. Should the company demonstrate that time-and-materials throughput remains firm and that fixed-price engagements are tracking to plan, cautious expectations could tilt more constructive post-print; if execution signals are mixed, maintaining a measured stance would be consistent with the consensus profile embedded in current forecasts.