ICF International Reports 7% Revenue Decline in Q2 2025, Net Income Down 7.6%

ICF International, Inc. reported a decline in financial performance for the second quarter of 2025, with total revenue of $476.2 million, down 7% from $512.0 million in the same period last year. For the first half of 2025, revenue also decreased by 4.2% to $963.8 million compared to $1.0 billion in the first half of 2024. The company's net income for the quarter was $23.7 million, a decrease of 7.6% from $25.6 million in the prior year, while net income for the six months ended June 30, 2025, was $50.5 million, down 4.6% from $52.9 million in 2024. Earnings per share for the quarter were $1.28, compared to $1.36 in the previous year.

The decline in revenue was primarily attributed to a significant reduction in contracts with U.S. federal government clients, which fell by $68.8 million due to contract terminations linked to changing government priorities. This was partially offset by increases in revenue from commercial clients and state and local government clients. The company also noted a decrease in direct costs, which fell by 9.4% to $298.4 million, reflecting the impact of the terminated contracts. Indirect and selling expenses decreased slightly by 3.2% to $123.0 million, contributing to a total operating income of $40.0 million for the quarter.

In terms of strategic developments, ICF completed the acquisition of Applied Energy Group, Inc. in December 2024 for $59.9 million, enhancing its service offerings in energy technology and advisory services. The company continues to focus on integrating this acquisition and expanding its client base. As of June 30, 2025, ICF reported total assets of $2.1 billion, with stockholders' equity increasing to $1.0 billion, up from $982.5 million at the end of 2024.

Operationally, ICF's customer base remains diverse, with significant contributions from various sectors. The company reported a total of 24.3 million shares outstanding as of June 30, 2025, and continued its share repurchase program, buying back 31,339 shares during the quarter. The company also maintained a strong liquidity position, with $488.3 million available under its credit facility, which supports ongoing operations and potential future acquisitions.

Looking ahead, ICF anticipates continued demand for its services, particularly in disaster recovery and environmental solutions, as government and industry stakeholders address critical societal issues. However, the company acknowledges challenges related to government spending and procurement cycles, which may impact future revenue. ICF remains committed to enhancing client relationships and pursuing strategic acquisitions to drive growth in the coming quarters.