Q3 YoY Revenue Growth of 4%, Q3 YoY Net Revenue Growth of 6%
Q3 YoY Net Revenue Growth excluding Advocacy of 10%, Digital Transformation Net Revenue Growth of 12%, Marketing Services Net Revenue Growth of 9%
Q3 Net Income Attributable to Stagwell Inc. Common Shareholders of $25 million; Q3 Adjusted EBITDA of $115 million; Q3 Adjusted EBITDA ex. Advocacy YoY Growth of 23% to $103 million
Q3 EPS of $0.09; Adjusted EPS of $0.24
YTD Increase in Cash Flow from Operations of $100 million Over Prior Year Period
Net New Business of $122 million in Q3; LTM Net New Business of $472 million
Announced a Groundbreaking Partnership with Palantir
Guidance for 2025 of Total Net Revenue Growth of 8%; Adjusted EBITDA of $410 million to $460 million; Free Cash Flow Conversion in excess of 45%
NEW YORK, Nov. 6, 2025 /PRNewswire/ -- $(STGW)$ -- Stagwell Inc. ("Stagwell") today announced financial results for the three and nine months ended September 30, 2025.
THIRD QUARTER RESULTS:
-- Q3 Revenue of $743 million, an increase of 4% versus the prior year
period; YTD Revenue of $2,102 million, an increase of 2% versus the prior
year period;
-- Q3 Revenue ex. Advocacy of $686 million, an increase of 12% versus the
prior year period; YTD Revenue ex. Advocacy of $1,947 million, an
increase of 7% versus the prior year period;
-- Q3 Net Revenue of $615 million, an increase of 6% versus the prior year
period; YTD Net Revenue of $1,777 million, an increase of 7% versus the
prior year period;
-- Q3 Net Revenue ex. Advocacy of $578 million, an increase of 10% versus
the prior year period; YTD Net Revenue ex. Advocacy of $1,672 million, an
increase of 10% versus the prior year period;
-- Q3 Net Income attributable to Stagwell Inc. Common Shareholders of $25
million versus $3 million in the prior year period; YTD Net Income
attributable to Stagwell Inc. Common Shareholders of $16 million versus a
Net Loss attributable to Stagwell Inc. Common Shareholders of $1 million
in the prior year period;
-- Q3 Adjusted EBITDA of $115 million, an increase of 3% versus the prior
year period; YTD Adjusted EBITDA of $288 million, flat versus the prior
year period;
-- Q3 Adjusted EBITDA Margin of 19% on net revenue; YTD Adjusted EBITDA
Margin of 16% on net revenue;
-- Q3 Earnings Per Share Attributable to Stagwell Inc. Common Shareholders
of $0.09 versus $0.03 in the prior year period; YTD Earnings Per Share
Attributable to Stagwell Inc. Common Shareholders of $0.04 versus $(0.01)
in the prior year period;
-- Q3 Adjusted Earnings Per Share attributable to Stagwell Inc. Common
Shareholders of $0.24 versus $0.22 in the prior year period; YTD Adjusted
Earnings Per Share attributable to Stagwell Inc. Common Shareholders of
$0.53 versus $0.53 in the prior year period;
-- YTD Net Cash provided by Operating Activities of $31 million versus net
cash used in Operating Activities of $69 million in the prior year
period;
-- Net new business of $122 million in the third quarter, last twelve-month
net new business of $472 million
See "Non-GAAP Financial Measures" below for explanations and reconciliations of the Company's non-GAAP financial measures.
Mark Penn, Chairman and CEO of Stagwell, said, "With double-digit growth in non-advocacy work, strong organic growth in nearly all areas, enhanced cash flow and increased non-advocacy margin, this quarter again demonstrates how Stagwell is a winner in an industry undergoing significant transformation. Our newly announced partnership with Palantir is yet another example of how Stagwell is a leader in the application of AI for marketing."
Ryan Greene, Chief Financial Officer, commented: "While achieving significant growth, we're successfully trimming our costs. An active focus on labor efficiency and cost discipline resulted in a 19% adjusted EBITDA margin, and drove an impressive 9% year-over-year increase in adjusted EPS to $0.24, even with the cyclical advocacy pullback. The momentum we've built through the third quarter gives us confidence in a strong finish to the year."
Financial Outlook
2025 financial guidance is as follows:
-- Total Net Revenue growth of 8% -- Adjusted EBITDA of $410 million to $460 million -- Free Cash Flow Conversion in excess of 45% -- Adjusted EPS of $0.75 - $0.88 -- Guidance includes anticipated impact from acquisitions or dispositions. * The Company has excluded a quantitative reconciliation with respect to the Company's 2025 guidance under the "unreasonable efforts" exception in Item 10(e)(1)(i)$(B)$ of Regulation S-K. See "Non-GAAP Financial Measures" below for additional information.
Video Webcast
Management will host a video webcast on Thursday, November 6, 2025, at 8:30 a.m. $(ET)$ to discuss results for Stagwell Inc. for the three and nine months ended September 30, 2025. The video webcast will be accessible at https://edge.media-server.com/mmc/p/xtchu5qq/. An investor presentation has been posted on our website at www.stagwellglobal.com and may be referred to during the webcast.
A recording of the webcast will be accessible one hour after the webcast and available for ninety days at www.stagwellglobal.com.
Stagwell Inc.
Stagwell is the challenger network built to transform marketing. We deliver scaled creative performance for the world's most ambitious brands, connecting culture-moving creativity with leading-edge technology to harmonize the art and science of marketing. Led by entrepreneurs, our specialists in 45+ countries are unified under a single purpose: to drive effectiveness and improve business results for their clients. Join us at www.stagwellglobal.com.
Contacts
For Investors:
Ben Allanson
IR@stagwellglobal.com
For Press:
Beth Sidhu
PR@stagwellglobal.com
Non-GAAP Financial Measures
In addition to its reported results, Stagwell Inc. has included in this earnings release certain financial results that the Securities and Exchange Commission (SEC) defines as "non-GAAP Financial Measures." Management believes that such non-GAAP financial measures, when read in conjunction with the Company's reported results, can provide useful supplemental information for investors analyzing period to period comparisons of the Company's results. Such non-GAAP financial measures include the following:
(1) Organic Net Revenue: "Organic net revenue growth" and "Organic net revenue decline" reflects the year-over-year change in the Company's reported net revenue attributable to the Company's management of the entities it owns. We calculate organic net revenue growth (decline) by subtracting the net impact of acquisitions (divestitures) and the impact of foreign currency exchange fluctuations from the aggregate year-over-year increase or decrease in the Company's reported net revenue. The net impact of acquisitions (divestitures) reflects the year-over-year change in the Company's reported net revenue attributable to the impact of all individual entities that were acquired or divested in the current and prior year. We calculate impact of an acquisition as follows: (a) for an entity acquired during the current year, we present the entity's current period reported revenue as the impact of the acquisition in the current year; and (b) for an entity acquired in the prior year, we present an amount equal to the entity's current year net revenue for the same period during which we didn't own the entity in the prior year as the impact of the acquisition in the current year. We calculate impact of a divestiture as follows: (a) for a divestiture in the current year, we present the entity's prior year net revenue for the same period during which we no longer owned it in the current year as impact of the divestiture in the current year; and (b) for a divestiture in the prior year, we present the entity's prior year net revenue for the period during which we owned it in the prior year as impact of the divestiture in the current year. We calculate the impact of any acquisition or divestiture without adjusting for foreign currency exchange fluctuations. The impact of foreign currency exchange fluctuations reflects the year-over-year change in the Company's reported net revenue attributable to changes in foreign currency exchange rates. We calculate the impact of foreign currency exchange fluctuations for the portion of the reporting period in which we recognized revenue from a foreign entity in both the current year and the prior year. The impact is calculated as the difference between (1) reported prior period net revenue (converted to U.S. dollars at historical foreign currency exchange rates) and (2) prior period net revenue converted to U.S. dollars at current period foreign exchange rates.
(2) Net New Business: Estimate of annualized revenue for new wins less annualized revenue for losses incurred in the period.
(3) Adjusted EBITDA: defined as Net income excluding non-operating income or expense to achieve operating income, plus depreciation and amortization, stock-based compensation, deferred acquisition consideration adjustments, and other items. Other items include restructuring costs, acquisition-related expenses, and non-recurring items.
(4) Adjusted Diluted EPS is defined as (i) Net income (loss) attributable to Stagwell Inc. common shareholders, plus net income attributable to Class C shareholders, excluding amortization expense, impairment and other losses, stock-based compensation, deferred acquisition consideration adjustments, discrete tax items, and other items, divided by (ii) the diluted weighted average shares outstanding. The diluted weighted average shares outstanding is calculated as (a) the diluted weighted average number of common shares outstanding plus (b) the shares of Class C Common Stock as if converted to shares of Class A Common Stock if not yet included because they were anti-dilutive. Other items includes restructuring costs, acquisition-related expenses, and non-recurring items, and subject to the anti-dilution rules.
(5) Free Cash Flow: defined as Adjusted EBITDA less capital expenditures, change in net working capital, cash taxes, interest, and distributions to minority interests, but excludes contingent M&A payments. Free Cash Flow Conversion is the percentage of adjusted EBITDA.
Included in this earnings release are tables reconciling reported Stagwell Inc. results to arrive at certain of these non-GAAP financial measures.
This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Company's representatives may also make forward-looking statements orally or in writing from time to time. Statements in this document that are not historical facts, including, statements about the Company's beliefs and expectations, future financial performance, growth, and future prospects, the Company's strategy, business and economic trends and growth, technological leadership and differentiation, potential and completed acquisitions, anticipated and actual operating efficiencies and synergies and estimates of amounts for redeemable noncontrolling interests and deferred acquisition consideration, constitute forward-looking statements. Forward-looking statements, which are generally denoted by words such as "ability," "aim," "anticipate," "assume," "believe," "better," "build," "consider," "continue," "could," "develop," "drive," "enhance," "estimate," "expect," "focus," "forecast," "future," "grow," "guidance," "improve," "intend," "likely," "maintain," "may," "ongoing,", "outlook," "plan," "position," "possible," "potential," "probable," "project," "seek," "should," "target," "will," "would" or the negative of such terms or other variations thereof and terms of similar substance used in connection with any discussion of current plans, estimates and projections are subject to change based on a number of factors, including those outlined in this section.
Forward-looking statements in this document are based on certain key expectations and assumptions made by the Company. Although the management of the Company believes that the expectations and assumptions on which such forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. The material assumptions upon which such forward-looking statements are based include, among others, assumptions with respect to general business, economic and market conditions, the competitive environment, anticipated and unanticipated tax consequences and anticipated and unanticipated costs. These forward-looking statements are based on current plans, estimates and projections, and are subject to change based on a number of factors, including those outlined in this section. These forward-looking statements are subject to various risks and uncertainties, many of which are outside the Company's control. Therefore, you should not place undue reliance on such statements. Forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update publicly any of them in light of new information or future events, if any.
Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statements. Such risk factors include, but are not limited to, the following:
-- risks associated with international, national and regional unfavorable
economic conditions, including the effect of changing tariff and other
trade policies, inflation and other macroeconomic factors that could
affect the Company or its clients;
-- demand for the Company's services, which may precipitate or exacerbate
other risks and uncertainties;
-- inflation and actions taken by central banks to counter inflation;
-- the Company's ability to attract new clients and retain existing clients;
-- the impact of a reduction in client spending and changes in client
advertising, marketing and corporate communications requirements;
-- financial failure of the Company's clients;
-- the Company's ability to retain and attract key employees;
-- the Company's ability to compete in the markets in which it operates;
-- the Company's ability to achieve its cost saving initiatives;
-- the Company's implementation of strategic initiatives;
-- the Company's ability to remain in compliance with its debt agreements
and the Company's ability to finance its contingent payment obligations
when due and payable, including but not limited to those relating to
redeemable noncontrolling interests, deferred acquisition consideration
and profit interests;
-- the Company's ability to manage its growth effectively;
-- the Company's ability to identify and complete acquisitions or other
strategic transactions that complement and expand the Company's business
capabilities and successfully integrate newly acquired businesses into
the Company's operations, retain key employees, and realize cost savings,
synergies and other related anticipated benefits within the expected time
period;
-- the Company's ability to identify and complete divestitures and to
achieve the anticipated benefits therefrom;
-- the Company's ability to develop products incorporating new technologies,
including augmented reality, artificial intelligence, and virtual reality,
and realize benefits from such products;
-- the Company's use of artificial intelligence, including generative
artificial intelligence;
-- adverse tax consequences for the Company, its operations and its
stockholders, that may differ from the expectations of the Company,
including that recent or future changes in tax laws, potential changes to
corporate tax rates in the United States and disagreements with tax
authorities on the Company's determinations that may result in increased
tax costs;
-- adverse tax consequences in connection with the business combination that
formed the Company in August 2021, including the incurrence of material
Canadian federal income tax (including material "emigration tax");
-- the Company's ability to maintain an effective system of internal control
over financial reporting, including the risk that the Company's internal
controls will fail to detect misstatements in its financial statements;
-- the Company's ability to accurately forecast its future financial
performance and provide accurate guidance;
-- the Company's ability to protect client data from security incidents or
cyberattacks;
-- economic disruptions resulting from war and other economic and
geopolitical tensions (such as the ongoing military conflicts between
Russia and Ukraine and in the Middle East), terrorist activities, natural
disasters, public health events and tariff and trade policies;
-- stock price volatility; and
-- foreign currency fluctuations.
Investors should carefully consider these risk factors, other risk factors described herein, and the additional risk factors outlined in more detail in our 2024 Form 10-K, filed with the Securities and Exchange Commission (the "SEC") on March 11, 2025, and accessible on the SEC's website at www.sec.gov, under the caption "Risk Factors," and in the Company's other SEC filings.
SCHEDULE 1
STAGWELL INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------------------- --------------------------------
2025 2024 2025 2024
--------------- --------------- --------------- ---------------
Revenue $ 742,998 $ 711,281 $ 2,101,556 $ 2,052,508
Operating
Expenses
Cost of services 470,937 457,018 1,342,240 1,340,456
Office and
general
expenses 166,422 176,440 528,845 507,916
Depreciation and
amortization 44,260 36,044 127,635 112,881
Impairment and
other losses 466 -- 466 1,715
--------------- --------------- --------------- ---------------
682,085 669,502 1,999,186 1,962,968
--------------- --------------- --------------- ---------------
Operating Income 60,913 41,779 102,370 89,540
Other income
(expenses):
Interest
expense, net (25,196) (23,781) (72,007) (68,279)
Foreign
exchange, net (366) 1,312 (484) (2,301)
Other, net (2,032) 249 (2,143) (825)
--------------- --------------- --------------- ---------------
(27,594) (22,220) (74,634) (71,405)
--------------- --------------- --------------- ---------------
Income before
income taxes and
equity in
earnings of
non-consolidated
affiliates 33,319 19,559 27,736 18,135
Income tax
expense 9,555 5,691 13,950 9,441
--------------- --------------- --------------- ---------------
Income before
equity in
earnings of
non-consolidated
affiliates 23,764 13,868 13,786 8,694
Equity in income
(loss) of
non-consolidated
affiliates (1) (4) 18 503
--------------- --------------- --------------- ---------------
Net income 23,763 13,864 13,804 9,197
Net (income) loss
attributable to
noncontrolling
and redeemable
noncontrolling
interests 856 (10,593) 2,637 (10,173)
--------------- --------------- --------------- ---------------
Net income (loss)
attributable to
Stagwell Inc.
common
shareholders $ 24,619 $ 3,271 $ 16,441 $ (976)
=============== =============== =============== ===============
Earnings (Loss)
Per Common
Share:
Basic $ 0.10 $ 0.03 $ 0.08 $ (0.01)
=============== =============== =============== ===============
Diluted $ 0.09 $ 0.03 $ 0.04 $ (0.01)
=============== =============== =============== ===============
Weighted Average
Number of Common
Shares
Outstanding:
Basic 255,952 108,198 210,139 111,436
Diluted 259,583 112,190 266,773 111,436
SCHEDULE 2
STAGWELL INC.
UNAUDITED COMPONENTS OF NET REVENUE CHANGE
(amounts in thousands)
Net Revenue - Components of Change Change
------------------------------------------------------ --------------- -------------- ------------------
Three Months Three Months
Ended Net Ended
September 30, Foreign Acquisitions September 30,
2024 Currency (Divestitures) Organic (1) Total Change 2025 Organic Total
--------------- --------------- ------------------ ---------------- ---------------- --------------- -------------- -------- --------
Marketing
Services $ 225,411 $ 989 $ 4,970 $ 14,724 $ 20,683 $ 246,094 6.5 % 9.2 %
Digital
Transformation 85,270 (99) 4,356 5,849 10,106 95,376 6.9 % 11.9 %
Media &
Commerce 145,558 1,109 2,782 4,708 8,599 154,157 3.2 % 5.9 %
Communications 112,563 214 7,291 (23,576) (16,071) 96,492 (20.9) % (14.3) %
The Marketing
Cloud 11,443 416 14,567 756 15,739 27,182 6.6 % 137.5 %
Eliminations (52) -- -- (4,727) (4,727) (4,779) NM NM
--------------- ------------------ ---------------- ---------------- --------------- -------------- -------- --------
$ 580,193 $ 2,629 $ 33,966 $ (2,266) $ 34,329 $ 614,522 (0.4) % 5.9 %
=============== ================== ================ ================ =============== ============== ======== ========
(1) See Non-GAAP Financial Measures section above for the definition of
Organic Net Revenue.
SCHEDULE 3
STAGWELL INC.
UNAUDITED COMPONENTS OF NET REVENUE CHANGE
(amounts in thousands)
Net Revenue - Components of Change Change
--------------------------------------------------- --------------- -------------- -----------------
Nine Months Nine Months
Ended Net Ended
September 30, Foreign Acquisitions September 30,
2024 Currency (Divestitures) Organic (1) Total Change 2025 Organic Total
--------------- --------------- ---------------- ---------------- --------------- --------------- -------------- -------- -------
Marketing
Services $ 658,175 $ 1,473 $ 2,916 $ 52,303 $ 56,692 $ 714,867 7.9 % 8.6 %
Digital
Transformation 239,613 (275) 8,196 27,444 35,365 274,978 11.5 % 14.8 %
Media &
Commerce 439,783 1,651 2,675 (12,254) (7,928) 431,855 (2.8) % (1.8) %
Communications 303,890 162 29,002 (47,948) (18,784) 285,106 (15.8) % (6.2) %
The Marketing
Cloud 25,823 455 53,523 (1,032) 52,946 78,769 (4.0) % NM
Eliminations (245) -- -- (8,492) (8,492) (8,737) NM NM
--------------- ---------------- ---------------- --------------- --------------- -------------- -------- -------
$ 1,667,039 $ 3,466 $ 96,312 $ 10,021 $ 109,799 $ 1,776,838 0.6 % 6.6 %
=============== ================ ================ =============== =============== ============== ======== =======
(1) See Non-GAAP Financial Measures section above for the definition of
Organic Net Revenue.
SCHEDULE 4
STAGWELL INC.
UNAUDITED SEGMENT OPERATING RESULTS
(amounts in thousands)
For the Three Months Ended September 30, 2025
The Corporate
Marketing Digital Media & Marketing &
Services Transformation Commerce Communications Cloud Eliminations Total
---------------- ----------- --------------------- ------------ ----------------------- ------------- ---------------- ----------
Net Revenue $ 246,094 $ 95,376 $ 154,157 $ 96,492 $ 27,182 $ (4,779) $ 614,522
Billable costs 51,101 8,334 20,581 48,455 5 -- 128,476
----------- --------------------- ------------ ----------------------- ------------- ---------------- ----------
Revenue 297,195 103,710 174,738 144,947 27,187 (4,779) 742,998
----------- --------------------- ------------ ----------------------- ------------- ---------------- ----------
Billable costs 51,101 8,334 20,581 48,455 5 -- 128,476
Staff costs 144,354 62,123 91,365 56,650 18,763 13,955 387,210
Administrative
costs 27,919 6,981 22,966 12,516 3,663 (2,253) 71,792
Unbillable and
other costs,
net 17,227 387 15,196 2,245 5,883 -- 40,938
----------- --------------------- ------------ ----------------------- ------------- ---------------- ----------
Adjusted EBITDA
(1) 56,594 25,885 24,630 25,081 (1,127) (16,481) 114,582
Stock-based
compensation 4,346 934 1,005 1,594 200 4,567 12,646
Depreciation
and
amortization 13,012 5,932 7,332 6,363 6,455 5,166 44,260
Deferred
acquisition
consideration (500) 1,874 1,413 (3,716) (12,419) -- (13,348)
Impairment and
other losses -- -- -- 222 244 -- 466
Other items,
net (1) 2,241 432 3,780 1,624 1,196 372 9,645
----------- --------------------- ------------ ----------------------- ------------- ---------------- ----------
Operating income
(loss) $ 37,495 $ 16,713 $ 11,100 $ 18,994 $ 3,197 $ (26,586) $ 60,913
=========== ===================== ============ ======================= ============= ================ ==========
(1) See Non-GAAP Financial Measures section above for the definition of
Adjusted EBITDA and Other items, net.
SCHEDULE 5
STAGWELL INC.
UNAUDITED SEGMENT OPERATING RESULTS
(amounts in thousands)
For the Nine Months Ended September 30, 2025
The Corporate
Marketing Digital Media & Marketing &
Services Transformation Commerce Communications Cloud Eliminations Total
---------------- ----------- --------------------- ------------ --------------------- ----------- ---------------- -----------
Net Revenue $ 714,867 $ 274,978 $ 431,855 $ 285,106 $ 78,769 $ (8,737) $ 1,776,838
Billable costs 124,590 17,210 47,793 135,109 16 -- 324,718
----------- --------------------- ------------ --------------------- ----------- ---------------- -----------
Revenue 839,457 292,188 479,648 420,215 78,785 (8,737) 2,101,556
----------- --------------------- ------------ --------------------- ----------- ---------------- -----------
Billable costs 124,590 17,210 47,793 135,109 16 -- 324,718
Staff costs 421,226 184,886 269,318 172,273 53,683 35,356 1,136,742
Administrative
costs 86,433 19,599 67,097 37,042 13,531 (927) 222,775
Unbillable and
other costs,
net 60,230 1,151 43,833 6,910 17,178 -- 129,302
----------- --------------------- ------------ --------------------- ----------- ---------------- -----------
Adjusted EBITDA
(1) 146,978 69,342 51,607 68,881 (5,623) (43,166) 288,019
Stock-based
compensation 15,069 3,081 3,065 6,760 541 15,627 44,143
Depreciation
and
amortization 40,141 17,250 21,626 19,349 17,436 11,833 127,635
Deferred
acquisition
consideration (4,784) 7,729 2,942 (4,879) (10,919) -- (9,911)
Impairment and
other losses -- -- -- 222 244 -- 466
Other items,
net (1) 3,296 1,493 10,030 3,686 2,448 2,363 23,316
----------- --------------------- ------------ --------------------- ----------- ---------------- -----------
Operating income
(loss) $ 93,256 $ 39,789 $ 13,944 $ 43,743 $ (15,373) $ (72,989) $ 102,370
=========== ===================== ============ ===================== =========== ================ ===========
(1) See Non-GAAP Financial Measures section above for the definition of
Adjusted EBITDA and Other items, net.
SCHEDULE 6
STAGWELL INC.
UNAUDITED SEGMENT OPERATING RESULTS
(amounts in thousands)
For the Three Months Ended September 30, 2024
The Corporate
Marketing Digital Media & Marketing &
Services Transformation Commerce Communications Cloud Eliminations Total
---------------- ----------- --------------------- ------------ --------------------- ------------- ------------------- ----------
Net Revenue $ 225,411 $ 85,270 $ 145,558 $ 112,563 $ 11,443 $ (52) $ 580,193
Billable costs 42,264 3,022 14,037 72,102 -- (337) 131,088
----------- --------------------- ------------ --------------------- ------------- ------------------- ----------
Revenue 267,675 88,292 159,595 184,665 11,443 (389) 711,281
----------- --------------------- ------------ --------------------- ------------- ------------------- ----------
Billable costs 42,264 3,022 14,037 72,102 -- (337) 131,088
Staff costs 139,694 56,384 88,390 55,518 8,887 13,106 361,979
Administrative
costs 26,825 5,036 20,171 11,668 3,505 2,351 69,556
Unbillable and
other costs,
net 15,435 368 16,357 2,848 2,481 -- 37,489
----------- --------------------- ------------ --------------------- ------------- ------------------- ----------
Adjusted EBITDA
(1) 43,457 23,482 20,640 42,529 (3,430) (15,509) 111,169
Stock-based
compensation 6,001 2,617 1,359 3,394 363 3,201 16,935
Depreciation
and
amortization 13,572 5,536 6,509 4,473 2,679 3,275 36,044
Deferred
acquisition
consideration (151) 1,265 (6,948) 6,778 (384) -- 560
Other items,
net (1) 3,047 509 7,821 1,850 43 2,581 15,851
----------- --------------------- ------------ --------------------- ------------- ------------------- ----------
Operating income
(loss) $ 20,988 $ 13,555 $ 11,899 $ 26,034 $ (6,131) $ (24,566) $ 41,779
=========== ===================== ============ ===================== ============= =================== ==========
(1) See Non-GAAP Financial Measures section above for the definition of
Adjusted EBITDA and Other items.
SCHEDULE 7
STAGWELL INC.
UNAUDITED SEGMENT OPERATING RESULTS
(amounts in thousands)
For the Nine Months Ended September 30, 2024
The Corporate
Marketing Digital Media & Marketing &
Services Transformation Commerce Communications Cloud Eliminations Total
---------------- ----------- --------------------- ------------ ----------------------- ----------- ------------------ -----------
Net Revenue $ 658,175 $ 239,613 $ 439,783 $ 303,890 $ 25,823 $ (245) $ 1,667,039
Billable costs 124,196 9,363 82,180 170,067 -- (337) 385,469
----------- --------------------- ------------ ----------------------- ----------- ------------------ -----------
Revenue 782,371 248,976 521,963 473,957 25,823 (582) 2,052,508
----------- --------------------- ------------ ----------------------- ----------- ------------------ -----------
Billable costs 124,196 9,363 82,180 170,067 -- (337) 385,469
Staff costs 407,948 166,965 265,576 162,715 21,024 35,257 1,059,485
Administrative
costs 74,293 15,707 61,509 33,689 9,659 11,396 206,253
Unbillable and
other costs,
net 53,176 788 46,244 7,958 5,547 -- 113,713
----------- --------------------- ------------ ----------------------- ----------- ------------------ -----------
Adjusted EBITDA
(1) 122,758 56,153 66,454 99,528 (10,407) (46,898) 287,588
Stock-based
compensation 15,002 8,102 4,399 5,467 648 5,308 38,926
Depreciation
and
amortization 40,426 16,813 24,149 13,544 9,309 8,640 112,881
Deferred
acquisition
consideration 2,000 3,690 (6,453) 9,097 (384) -- 7,950
Impairment and
other losses 1,500 -- -- -- -- 215 1,715
Other items,
net (1) 10,372 2,889 15,113 3,457 542 4,203 36,576
----------- --------------------- ------------ ----------------------- ----------- ------------------ -----------
Operating income
(loss) $ 53,458 $ 24,659 $ 29,246 $ 67,963 $ (20,522) $ (65,264) $ 89,540
=========== ===================== ============ ======================= =========== ================== ===========
(1) See Non-GAAP Financial Measures section above for the definition of
Adjusted EBITDA and Other items, net.
SCHEDULE 8 STAGWELL INC. UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS
PER SHARE (NON-GAAP MEASURE) (amounts in thousands, except per share amounts)
For the Three Months Ended September 30, 2025
GAAP Adjustments Non-GAAP
-------------------- ------------------ --------------------
Net income
attributable
to Stagwell
Inc. common
shareholders
and adjusted
net income $ 24,619 $ 38,147 $ 62,766
Diluted -
Weighted
average number
of shares
outstanding 259,583 -- 259,583
-------------------- ------------------ --------------------
Diluted EPS and
Adjusted
Diluted EPS
(1) $ 0.09 $ 0.24
==================== ====================
Adjustments to Net income
Amortization $ 38,707
Impairment and
other losses 466
Stock-based
compensation 12,646
Deferred
acquisition
consideration (13,348)
Other items,
net 11,928
------------------
50,399
Adjusted tax
expense (12,252)
------------------
$ 38,147
==================
(1) See Non-GAAP Financial Measures section above for the definition of
Adjusted Diluted EPS.
SCHEDULE 9 STAGWELL INC. UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS
PER SHARE (NON-GAAP MEASURE) (amounts in thousands, except per share amounts)
For the Nine Months Ended September 30, 2025
GAAP Adjustments Non-GAAP
--------------- -------------------- ----------------- --------------------
Net income
attributable to
Stagwell Inc.
common
shareholders $ 16,441 $ 131,430 $ 147,871
Net loss
attributable to
Class C
shareholders (6,637) -- (6,637)
-------------------- ----------------- --------------------
Net income
attributable to
Stagwell Inc.
and Class C
shareholders
and adjusted
net income $ 9,804 $ 131,430 $ 141,234
Diluted -
Weighted
average number
of common
shares
outstanding 214,557 -- 214,557
Weighted average
number of
shares of Class
C Common Stock
outstanding 52,216 -- 52,216
-------------------- ----------------- --------------------
Diluted -
Weighted
average number
of shares
outstanding 266,773 -- 266,773
Diluted EPS and
Adjusted
Diluted EPS
(1) $ 0.04 $ 0.53
==================== ====================
Adjustments to Net Income
Amortization $ 107,281
Impairment and
other losses 466
Stock-based
compensation 44,143
Deferred
acquisition
consideration (9,911)
Other items, net 25,599
-----------------
167,578
Adjusted tax
expense (36,148)
-----------------
$ 131,430
=================
(1) See Non-GAAP Financial Measures section above for the definition of
Adjusted Diluted EPS.
SCHEDULE 10 STAGWELL INC. UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS
PER SHARE (NON-GAAP MEASURE) (amounts in thousands, except per share amounts)
For the Three Months Ended September 30, 2024
GAAP Adjustments Non-GAAP
-------------------- ------------------ --------------------
Net income
attributable
to Stagwell
Inc. common
shareholders $ 3,271 $ 19,762 $ 23,033
Net income
attributable
to Class C
shareholders -- 36,060 36,060
-------------------- ------------------ --------------------
Net income
attributable
to Stagwell
Inc. and Class
C and adjusted
net income $ 3,271 $ 55,822 $ 59,093
Diluted -
Weighted
average number
of common
shares
outstanding 112,190 -- 112,190
Weighted
average number
of shares of
Class C Common
Stock
outstanding -- 151,649 151,649
-------------------- ------------------ --------------------
Diluted -
Weighted
average number
of shares
outstanding 112,190 151,649 263,839
Diluted EPS and
Adjusted
Diluted EPS
(1) $ 0.03 $ 0.22
==================== ====================
Adjustments to Net income
Amortization $ 28,659
Stock-based
compensation 16,935
Deferred
acquisition
consideration 560
Other items,
net 15,851
------------------
62,005
Adjusted tax
expense (15,615)
------------------
46,390
Net income
attributable
to Class C
shareholders 9,432
------------------
$ 55,822
==================
Allocation of
adjustments to
Net income
--------------
Net income
attributable
to Stagwell
Inc. common
shareholders $ 19,762
Net income
attributable
to Class C
shareholders -
add-backs 26,628
Net income
attributable
to Class C
shareholders 9,432
------------------
36,060
------------------
$ 55,822
==================
(1) See Non-GAAP Financial Measures section above for the definition of
Adjusted Diluted EPS.
SCHEDULE 11 STAGWELL INC. UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS
PER SHARE (NON-GAAP MEASURE) (amounts in thousands, except per share amounts)
For the Nine Months Ended September 30, 2024
GAAP Adjustments Non-GAAP
-------------- -------------------- ------------------ --------------------
Net income
(loss)
attributable
to Stagwell
Inc. common
shareholders $ (976) $ 58,177 $ 57,201
Net income
attributable
to Class C
shareholders -- 83,442 83,442
-------------------- ------------------ --------------------
Net income
(loss)
attributable
to Stagwell
Inc. and Class
C shareholders
and adjusted
net income $ (976) $ 141,619 $ 140,643
Diluted -
Weighted
average number
of common
shares
outstanding 111,436 -- 111,436
Weighted
average number
of shares of
Class C Common
Stock
outstanding -- 151,649 151,649
-------------------- ------------------ --------------------
Diluted -
Weighted
average number
of shares
outstanding 111,436 151,649 263,085
Diluted EPS and
Adjusted
Diluted EPS
(1) $ (0.01) $ 0.53
==================== ====================
Adjustments to Net income (loss)
Amortization $ 91,870
Impairment and
other losses 1,715
Stock-based
compensation 38,926
Deferred
acquisition
consideration 7,950
Other items,
net 36,576
------------------
177,037
Adjusted tax
expense (41,268)
------------------
135,769
Net income
attributable
to Class C
shareholders 5,850
------------------
$ 141,619
==================
Allocation of
adjustments to
Net income
Net income
attributable
to Stagwell
Inc. common
shareholders $ 58,177
Net income
attributable
to Class C
shareholders -
add-backs 77,592
Net income
attributable
to Class C
shareholders 5,850
------------------
83,442
------------------
$ 141,619
==================
(1) See Non-GAAP Financial Measures section above for the definition of
Adjusted Diluted EPS.
SCHEDULE 12
STAGWELL INC.
UNAUDITED CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
September 30, 2025 December 31, 2024
------------------------- -------------------------
ASSETS
Current Assets
Cash and cash
equivalents $ 132,238 $ 131,339
Accounts receivable,
net 777,947 716,415
Expenditures billable
to clients 150,255 173,194
Other current assets 170,011 114,200
------------------------- -------------------------
Total Current Assets 1,230,451 1,135,148
Fixed assets, net 64,895 72,706
Right-of-use assets -
operating leases 217,398 219,400
Goodwill 1,597,312 1,554,146
Other intangible
assets, net 851,487 836,783
Deferred tax assets 250,360 46,926
Other assets 49,992 43,112
------------------------- -------------------------
Total Assets $ 4,261,895 $ 3,908,221
========================= =========================
LIABILITIES,
REDEEMABLE
NONCONTROLLING
INTERESTS ("RNCI"),
AND SHAREHOLDERS'
EQUITY
Current Liabilities
Accounts payable $ 408,149 $ 449,347
Accrued media 206,753 245,883
Accruals and other
liabilities 275,227 265,356
Advance billings 375,768 294,609
Current portion of
lease liabilities -
operating leases 56,774 60,195
Current portion of
deferred acquisition
consideration 53,569 51,906
------------------------- -------------------------
Total Current
Liabilities 1,376,240 1,367,296
Long-term debt 1,526,291 1,353,624
Long-term portion of
deferred acquisition
consideration 23,478 50,209
Long-term lease
liabilities -
operating leases 227,540 245,397
Deferred tax
liabilities 53,497 47,239
Long-term tax
receivable agreement
liability 223,600 25,493
Other liabilities 52,179 33,646
------------------------- -------------------------
Total Liabilities 3,482,825 3,122,904
Redeemable
Noncontrolling
Interests 8,589 8,412
Commitments,
Contingencies and
Guarantees
Shareholders' Equity
Common shares - Class
A 254 115
Common shares - Class
C -- 2
Paid-in capital 741,702 343,647
Retained earnings 29,542 11,740
Accumulated other
comprehensive loss (22,451) (23,773)
------------------------- -------------------------
Stagwell Inc.
Shareholders' Equity 749,047 331,731
Noncontrolling
interests 21,434 445,174
------------------------- -------------------------
Total Shareholders'
Equity 770,481 776,905
------------------------- -------------------------
Total Liabilities,
Redeemable
Noncontrolling
Interests and
Shareholders' Equity $ 4,261,895 $ 3,908,221
========================= =========================
SCHEDULE 13
STAGWELL INC.
UNAUDITED SUMMARY CASH FLOW DATA
(amounts in thousands)
Nine Months Ended September 30,
2025 2024
---------------------- -----------------------
Cash flows from operating
activities:
Net income $ 13,804 $ 9,197
Adjustments to reconcile
net income to cash provided
by (used in) operating
activities:
Stock-based compensation 44,143 38,926
Depreciation and
amortization 127,635 112,881
Amortization of
right-of-use lease assets
and lease liability
interest 51,208 58,052
Impairment and other
(gains) losses (3,063) 1,715
Deferred income taxes 3,216 (3,446)
Adjustment to deferred
acquisition
consideration (9,911) 7,950
Other, net 1,319 6,371
Changes in working capital:
Accounts receivable (3,477) (6,212)
Expenditures billable to
clients 26,266 (15,705)
Other assets (53,377) (9,068)
Accounts payable (57,306) (94,160)
Accrued expenses and other
liabilities (117,118) (121,647)
Advance billings 67,964 23,984
Current portion of lease
liabilities - operating
leases (59,414) (63,956)
Deferred acquisition
related payments (1,176) (14,112)
---------------------- -----------------------
Net cash provided by (used
in) operating activities 30,713 (69,230)
---------------------- -----------------------
Cash flows from investing
activities:
Capitalized software (45,315) (19,320)
Capital expenditures (26,338) (16,728)
Acquisitions, net of cash
acquired (6,179) (23,781)
Other (2,927) (6,656)
---------------------- -----------------------
Net cash used in investing
activities (80,759) (66,485)
---------------------- -----------------------
Cash flows from financing
activities:
Repayment of borrowings
under revolving credit
facility (1,412,000) (1,176,000)
Proceeds from borrowings
under revolving credit
facility 1,586,326 1,492,000
Shares repurchased and
cancelled (105,183) (101,249)
Distributions to
noncontrolling interests (5,018) (23,583)
Payment of deferred
consideration (16,103) (28,721)
Purchase of noncontrolling
interest -- (3,316)
Debt financing and other
costs (3,795) --
Net cash provided by
financing activities 44,227 159,131
---------------------- -----------------------
Effect of exchange rate
changes on cash and cash
equivalents 6,718 2,654
Net increase in cash and
cash equivalents 899 26,070
Cash and cash equivalents
at beginning of period 131,339 119,737
---------------------- -----------------------
Cash and cash equivalents
at end of period $ 132,238 $ 145,807
====================== =======================
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SOURCE Stagwell Inc.
(END) Dow Jones Newswires
November 06, 2025 07:15 ET (12:15 GMT)
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