Good morning, Marc, and good morning, everyone. I have a deck here I'm gonna try to take everyone through in about 15 to 20 minutes, and hopefully leave enough time for any questions you may have. I apologize in advance for the speed-dating feel of getting through this, but we got a lot of content to cover. You know, as I'm saying I have to rush through this presentation, one may ask, "Wow, why are you showing this picture that took place in June of 2025?" Because right now we're in the middle of the first quarter of 2026, we have formally put a bow on 2025 with the release of our Q4 earnings and the guidance for 2026.
I want to take a moment to highlight CRA's 60th anniversary, which we celebrated by ringing the bell on Nasdaq. A lot has happened in those 60 years. A lot has happened even in my 16 years as CEO. If I do say so myself, it all has been a really good experience. The success of this firm over extended windows of time talks to its resiliency and our positioning to succeed in a market going forward. We celebrated 60 years, and you would say a lot has probably changed, and that is probably true. The fact is, the fundamentals of the firm have stayed the same throughout these last several decades, and that we are bringing deep levels of expertise in economics, finance, and strategy to help business leaders make more informed decisions.
Our services are divided up across two lines of business, Legal & Regulatory and Management Consulting, with Legal & Regulatory making up roughly 80% of the aggregate portfolio. As with any consulting firm, particularly CRA, it starts and ends with the quality of our people. We hire the best and brightest individuals at CRA, and we have a wonderful track record of retaining and developing these individuals for it. In the upper left-hand corner, you can see that we are a highly pedigreed shop as it relates to, you know, educational pedigree. Our people, once here, stay a long time, with roughly half of my senior colleagues being at CRA at five years or more.
To talk about the selectivity of the firm, when we go on campus, we're accepting less than 1% of the applicants. So we work hard to identify and recruit these individuals, but we have not eased up on our expectations of what these individuals should bring to CRA. The last square of this chart that I wanna talk about is in the upper right-hand corner, and it reads, "Less than 5% voluntary turnover among top revenue generators over the past five years." The reason I wanna highlight that is, if you're a large revenue generator, quite frankly, you can go anywhere you want, and probably demand a premium over what you're enjoying at CRA. So I start with that. When I talk about less than 5% voluntary turnover, that's not 5% annually, that's 5% in aggregate.
Every year I present to the board our top 30 revenue generators, and we talk about the composition, the drivers of these revenue generators. If I look at the union of that top 30 over the past five years, probably roughly about 60 vice presidents who make up that top 30 list over the past five years. When I talk about less than 5%, that means over a five-year window of time, I have lost less than three people in aggregate. That speaks a lot to me because these individuals who have a plethora of choices are choosing to make their careers at CRA. On it. We talked about the two lines of business.
Probably the best way to divide up these different practice areas is to identify the practices who make up the Management Consulting side of the house, and that being Life Sciences, Energy, and Marakon make up the Management Consulting side of the house. All the other practices listed here make up Legal & Regulatory. Our Antitrust & Competition Economics practice makes up roughly 40%-45% of the entire firm's revenue. The top three practices at CRA in terms of revenue are comprised of the Antitrust & Competition Economics practice, our Forensic Services practice, and our Life Sciences practice.
Together, these top three make up roughly 75% of the firm's total revenue. You may not have heard of CRA, you may not have heard of the practices that I just referenced, but I'm pretty sure all of you have heard of our clients. What this is just a little sampling of some of the logos of our clients. As the title reads, in the past two years, we have worked with 88 of the Fortune 100 companies. If I showed you this chart from last year, or I showed you this chart from five years ago, you're gonna see roughly the same share of the Fortune 100 companies comprising of our client base. It's 88, 89, 85. That's not because I have annuity-based or subscription-based relationship with these clients.
It's because these clients, time and time again, come to CRA for their most challenging, strategic decisions on that. Our share is even greater when you look at law firms. In just the past two years, we've worked for 98 of the top 100 law firms, you know, in the world here. Our goal is not necessarily to expand into the next 100 top law firms. Our goal is to continue to gain penetration into these important, intermediary clients. The individuals, the client relationships all, translate into the financial performance that you see here. It just is a summary of CRA's financial performance in 2025, the last five years, the last 10 years.
What I want the takeaway to be is irrespective of the time period that you're looking at, the financial performance looks pretty similar. It looks pretty similar across a wide array of macroeconomic and micro conditions that CRA has encountered. Time and time again, we have demonstrated our ability to grow revenue, high single digits, 9%, 10% a year, to grow profits at an even faster rate than revenue, and at the same time, return substantial amount of capital back to our shareholders in the form of stock repurchases and cash dividends. This fundamental model of revenue growth and profitability and return of capital to shareholders has been our trademark for the last, you know, 10+ years, and I see it continuing in the next 5+ years, for CRA. Our investment thesis is really quite simple.
My goal is to maximize CRA's long-term value per share, right? We are value-based decision maker. Every dollar spent, we wanna make sure we are earning a return north of our cost of capital at CRA. The per share part of this objective statement is that if we don't have the positive NPV opportunities for reinvestment, we're gonna give the money back to all of you on that. Okay. I wanna pivot a little bit, and it's hard for me not to talk about the impact of AI on CRA, because despite record setting performance in Q4 of 2025, despite the record year that we demonstrated in 2025, and guidance that would translate into record year number nine for CRA, our stock has been hammered in the past four or so weeks on fears of AI.
If it's to make me feel better, it's not. The large sector of our markets as a whole have been hammered by AI fears with it. I thought I would cover a couple of fundamental beliefs on it. First, I really think CRA is positioned on the right side of this technology revolution that is happening. AI will enhance the value or increase the value of expertise, which CRA has been known for for the last 60 years. That is not just our belief, it is belief of you know current experts on this AI revolution. It has also been the experience with past technological advancements at CRA. I think AI also is gonna continue to increase the complexity of economic decisions that our clients are facing.
Increased complexity will increase demand for the kinds of services that CRA provides. In addition, I think it will create new revenue streams for CRA because clients don't come to CRA for our ability to process data quickly. Clients come to CRA for our ability to ask the right questions, to provide insights into that information, and help them defend their conclusion in the various markets. All of that will continue to grow in importance with AI. AI is gonna increase our ability to be more efficient, our ability to be more productive into the future. The fact is, it hasn't been improving our ability to be more efficient for the last several years. AI is not a new tool at CRA.
We have been using many of the large language models for the last several years that have allowed us to intake information more efficiently, have allowed us to digest and manipulate that information more efficiently. I think we are on the right road going forward. Lastly, the more efficient we get, the higher the value is of the services that we provide. It may also introduce other markets that we were previously priced out of. Our ability to do the more manual data manipulations more efficiently means that we can provide our value-added services to a wider array of clients in the marketplace. On it. Okay. Shifting back to the financials here.
I talked about CRA has grown revenue in the high single digits for the last dozen or so years, and we've grown that revenue, and we've grown it profitably, with our profit margin steadily expanding. There is one little asterisk to that, in that there's a large non-cash item that flows through our income statement called non-cash amortization of forgivable loans. This non-cash amortization of forgivable loans is the result of talent investments that we make either to retain talent or to acquire inorganic pursuits of growth and revenue here. Our true cash-generating capacity of our profits are not going to be conveyed by just looking at EBITDA. They're gonna be conveyed by looking at EBITDA and taking into consideration, or I would say, adding back the non-cash amortization of forgivable loans to it. We can show you the two numbers.
The SEC says I can't add the two numbers together for your review. We have, though, in the last couple of years, provided an adjusted cash flow from ops that makes the various adjustments you need to analyze the true cash-generating capacity of the firm. One of the best ways to demonstrate that is that if you look at EBITDA, many firms' ability to take EBITDA, and convert it to cash generation, is usually at a number less than one. For CRA, our history has been that for 2025, we converted about 112% of EBITDA into these net cash flows from operations. If you look at the last three years, 111%. Last five years, 112%. If I look at even further, that percentage is even higher.
The reason I'm highlighting this is that the talk about forgivable loan amortization is not smoke and mirrors. We have demonstrated the ability to take these non-cash charges and convert them into cash that allows the firm to reinvest back in the business. The next set of slides shows what our use of this capital has been in the last five years. To demonstrate that all of this foots, the last five years, the total cash outlays are summarized on this chart. It foots because during this time period, we have no long-term debt. Everything was funded by internal cash from operations. What we spent is what we generated in our cash generation.
What you see is roughly half of the cash generation has gone to talent investments, the other half has been redistribution back to our shareholders, and a very small piece has been to what I would call traditional CapEx. So going into the talent here. We have spent roughly $230 million on talent over the last five years. That spending of $230 million had generated more than $240 million of revenue in a single year. This is not cumulative revenue. It has generated roughly $240 million of current year revenue. That is probably an underestimate of the true revenue-generating capacity, 'cause that includes talent investments that we made for inorganic pursuits in 2024, 2025, that haven't come to full fruition in terms of revenue contribution.
When presented with the opportunity to invest in talent, we will take that every day of the week over any of the other redistribution options. CapEx, it has been small, and we expect it continue to be small for the next five years or so. What you see here on the last bullet is, you know, we expect non-real estate expenditures to average less than $5 million a year going forward. Last, but definitely not least, the money spent on redistributions to cash flows. We've returned roughly $240 million back to our shareholders over the past five years, and I think those outlays have proved to be quite attractive for CRA and for our shareholders.
We purchased back 1.7 million shares over the past five years at an average price of $110 per share. The reduction in the net shares outstanding was about by 15%. If I look at the last 10 or 12 years, we've reduced our share count by more than 30%. Not only are we rebuying shares, but we're also have a pretty healthy dividend. Our first dividend was put out there in Q4 of 2016. We'll be coming up on our 10-year anniversary soon. That $0.14 per share on the quarterly dividend is up to $0.57 per share. All of this combined has produced a shareholder yield of roughly 5.5%.
Marc, I think I'm gonna stop there, see if there's any questions that I can try to address in the last few minutes.
Excellent. Thank you very much, Paul. As a reminder for folks, if you would like to ask a question, just click on the Q&A prompt at the bottom of your screen, and we'll be glad to get your questions. Actually, this slide, I'd go ahead and start here with the slide, kinda gives us a launching point, if you will, with the guide that was put out for the year. Maybe you could talk a little bit about some of the drivers behind that. For those who may not be as familiar with the company, you know, these are not coming off of. Yeah, you guys have had record years pretty consistently, so we're not exactly looking at a situation where, you know, you're going against an easy comp.
I don't think we've seen that year at CRA for quite some time. Maybe you could talk a little bit about the revenue range guide and some of the puts and takes that were in place there.
Sure. The first thing I wanna say about the revenue range guidance, it is on a constant currency basis. We use the currency that existed in the prior year in estimating that. We, right now, based on the forecast of exchange rates, we expect that our reported revenue stated on a constant currency basis will be roughly $5 million less. If I were to convert this range of $785 million-$805 million in annual revenue for fiscal 2026 on a reported revenue basis, that would be $790 million-$810 million on a reported revenue basis. You know, the midpoint of that would be somewhere in the mid-sixes on a reported basis. Yes, it's relative to a record year in 2025.
The other thing to keep in mind, if people wanna look at growth rates, it's also relative to a year of 2025 that had 53 weeks in it, and fiscal 2026 will have 52 weeks in it. So we're expecting a nice, healthy revenue growth. Our initial revenue estimates are not based on any expectations of new inorganic pursuits. So our revenue guidance is based on the revenue expectations of the assets I have at CRA today or at the end of the year, not ones I expect to bring on going forward. So that provides some upside opportunity there. With respect to our non-GAAP EBITDA margin, we expect forgivable loan amortization to grow by roughly $14 million in 2026 relative to 2025.
When you evaluate the non-GAAP EBITDA margin, please take that into account for year-over-year comparisons on that. With respect to our utilization going forward, we expect to be in the mid- to upper 70s%, which should continue to give rise to healthy profitability for the firm.
Okay. Excellent. As we look at the beginning of the year, are there any areas of the business that maybe don't get as much attention as some others do that you would like to sort of highlight that maybe investors are not as familiar with as they are with your larger parts of the business?
Sure. The good thing for anyone who listens in and reads any of our investment material is the fact that you've got to hear about almost every single one of our practices over the last few years. The reason for that is our success is tied to the contributions of our entire portfolio. We constantly use the phrase, broad-based contributions, and that's because I have a majority of my practices are contributing to our profitable growth. In addition to the big three made up of the Competition, Forensics, and Life Sciences practice, some of the real gems that I expect to be contributing in the years ahead is our Energy practice has been on a wonderful trajectory.
The quality of the services, I think, are bar none, and the need in the electric utility space is growing for sophisticated consulting services, so I'm really bullish on that practice in the years ahead. I'm also really bullish on our Intellectual Property practice because intellectual property rights will continue to become more complicated, particularly in this AI world, as to who exactly owns the rights to the information being disseminated through these tools.
Okay, great. We do have a question that came in and asking about the share repurchase authorization, how much remains there and the current appetite to buy back stocks given the AI-driven pullback in the shares more recently.
Yeah. I mean, our goal continues to be to return roughly 50% of our adjusted cash flows back to shareholders, as in years past. I think that will be dominated by share repurchases. That hasn't changed at all. If anything, I believe the gap between the intrinsic valuation for CRA and the prevailing stock price has grown, unfortunately, but gives us a great buying opportunity, and we're gonna try to take advantage of that in the weeks and months ahead.
Okay, great. Shifting gears, in your prepared remarks, you talked about the lack of turnover and the fact that folks stay and stay for long periods of time with the company. Maybe talk a little bit about the level of activity that you're seeing just overall in the industry. Do you get a sense that presents an opportunity for adding talent or maybe what you're seeing out there from your peers and how that positions you.
I think everyone wants to either join or be a part of a thriving platform. It's so growth and profitable growth is not just attractive to shareholders, it's attractive to my colleagues because of the stability. The vibrancy of the platform continues to increase. We hired lateral hires, 19 new vice presidents in 2025, and the pipeline remains really rich right now and full as we enter 2026. I don't know whether we will repeat the level of laterals in 2026, but we are fortunate enough to be able to talk to a lot of really talented people and succeed more often than not at bringing them onto the CRA platform, which could improve on the overall quality.
With all that said, I just wanna highlight that the majority of our growth is still on the organic side of the equation, right? Roughly 60% of our aggregate growth is driven by organic expansion, not inorganic contributions. You need that organic base in order to even consider the inorganic opportunities.
Excellent. That pretty much brings us to the end of our time today. I just wanted to leave you with a moment for any closing remarks you'd like to share.
No. Look, I really appreciate the opportunity. I appreciate all of you guys listening in to it. You know, we remain very bullish on CRA. There is nothing that I have seen with respect to our operation, with respect to the feedback we're getting from clients, to lead me to believe that the punishing actions on our stock over the past four weeks are indicative of the underlying economics and opportunities for the overall company. With that, please reach out if there's any questions or insights that anyone can provide. Thank you, Marc, and thank you to everyone.
Thank you very much, Paul. Thank you to everyone at CRA, and this will conclude our time today. Everybody have a wonderful and productive remainder of the day. Thank you, Paul.
Thank you.