Third Quarter 2025 EARNINGS PRESENTATION November 6 | 2025 FORWARD LOOKING STATEMENTS & OTHER INFORMATION 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 fac ...

Financial Performance - Q3 2025 revenue of $743 million, a 4% increase year-over-year; year-to-date revenue of $2,102 million, a 2% increase year-over-year[4] - Q3 net income attributable to Stagwell Inc. common shareholders of $25 million, compared to $3 million in the prior year period; year-to-date net income of $16 million, compared to a net loss of $1 million in the prior year[4] - Q3 adjusted EBITDA of $115 million, a 3% increase year-over-year; adjusted EBITDA margin of 19% on net revenue[8] - Q3 adjusted EPS of $0.24, a 9% year-over-year increase; year-to-date adjusted EPS remains at $0.53[8] - Operating income for the three months ended September 30, 2025, was $60.913 million, up 45.8% from $41.779 million in the prior year[24] - The company reported an adjusted EBITDA of $114.582 million for the three months ended September 30, 2025[31] - Adjusted EBITDA for the same period was $288,019,000, with a margin of approximately 16.2%[34] - The diluted earnings per share (EPS) for the same period was $0.04, while the adjusted diluted EPS was $0.53[45] Revenue Growth - Net new business of $122 million in Q3; last twelve-month net new business totaled $472 million[3] - Guidance for 2025 includes total net revenue growth of approximately 8% and adjusted EBITDA between $410 million and $460 million[9] - Digital transformation net revenue growth of 12% in Q3[2] - Strong organic growth in nearly all areas, with non-advocacy work showing double-digit growth[6] - Organic net revenue growth for the three months ended September 30, 2025, was 5.9%, with total net revenue reaching $614.522 million[26] - Marketing Services segment generated $246.094 million in net revenue for the three months ended September 30, 2025, reflecting a 6.5% increase[31] - Digital Transformation segment reported net revenue of $95.376 million, representing an 11.9% increase year-over-year[31] - Media & Commerce segment's net revenue was $154.157 million, a 5.9% increase compared to the previous year[31] - For the nine months ended September 30, 2025, total net revenue was $2.101556 billion, a 2.4% increase from $2.052508 billion in the same period of 2024[24] Cash Flow and Costs - Free cash flow conversion expected to exceed 45% in 2025[9] - Total staff costs for the nine months ended September 30, 2025, amounted to $1,136,742,000, reflecting a strategic investment in human resources[34] - The company incurred $222,775,000 in administrative costs during the nine months ended September 30, 2025[34] - Billable costs for the nine months ended September 30, 2025, totaled $324,718,000, indicating effective cost management[34] - The company reported $15,627,000 in stock-based compensation for the nine months ended September 30, 2025[34] - Stock-based compensation for the nine months ended September 30, 2025, was $44,143,000, compared to $38,926,000 in the same period of 2024[52] Assets and Liabilities - Total assets increased to $4,261,895,000 as of September 30, 2025, compared to $3,908,221,000 at the end of 2024, reflecting a growth of approximately 9%[50] - Cash and cash equivalents at the end of the period were $132,238,000, slightly up from $131,339,000 at the beginning of the period[52] - The company reported net cash provided by operating activities of $30,713,000 for the nine months ended September 30, 2025, compared to a net cash used of $69,230,000 in the same period of 2024[52] - Stagwell Inc. had total current liabilities of $1,376,240,000 as of September 30, 2025, which is relatively stable compared to $1,367,296,000 at the end of 2024[50] - The company’s long-term debt increased to $1,526,291,000 as of September 30, 2025, up from $1,353,624,000 at the end of 2024[50] Future Outlook - Future outlook includes continued focus on market expansion and new product development to drive revenue growth[34] - Announced a groundbreaking partnership with Palantir, enhancing Stagwell's leadership in AI for marketing[6]

Financial Performance - Q3 2025 revenue reached $743 million, a 4% increase year-over-year, while net revenue grew by 6% to $615 million [9] - Excluding advocacy, Q3 revenue was $686 million, reflecting a 12% increase, and net revenue was $578 million, up 10% year-over-year [9] - Net income attributable to Stagwell Inc. common shareholders was $25 million, compared to $3 million in the prior year [9] - Adjusted EBITDA for Q3 was $115 million, a 3% increase year-over-year, with an adjusted EBITDA margin of 19% [9][4] - Q3 earnings per share (EPS) was $0.09, while adjusted EPS was $0.24, up from $0.22 in the prior year [9][4] Business Growth and New Partnerships - Stagwell reported net new business of $122 million in Q3, with a last twelve-month (LTM) net new business total of $472 million [9] - The company announced a partnership with Palantir, emphasizing its leadership in applying AI for marketing [4][2] - Guidance for 2025 indicates total net revenue growth of approximately 8%, with adjusted EBITDA projected between $410 million and $460 million [2][10] Cash Flow and Operational Efficiency - Year-to-date cash flow from operations increased by $100 million compared to the prior year [9] - The company achieved a 19% adjusted EBITDA margin, driven by cost discipline and labor efficiency [4]

Core Insights - Palantir Technologies Inc. and Stagwell have formed a partnership to create an AI-driven marketing platform aimed at enhancing marketing ROI for corporate marketers [1][2][5] Company Overview - Palantir's Foundry will be integrated with Code and Theory's software and The Marketing Cloud's data solutions to develop advanced marketing tools [2] - Stagwell is a marketing holding company focused on transforming marketing through technology and creativity [6] Product Features - The new platform will serve as a central hub for marketing, enabling audience alignment optimization and campaign management [3] - It allows enterprises to analyze millions of records to better understand audiences and improve brand performance strategies [4] - The platform will be available as a standalone solution for companies to monitor and enhance their marketing efforts [4] Market Impact - The partnership is expected to generate significant revenue, potentially reaching hundreds of millions of dollars over the coming years [5]

Core Insights - Stagwell Inc. (NASDAQ:STGW) is identified as one of the best stocks under $5 with significant upside potential, with a Buy rating and a price target of $9 set by Rosenblatt Securities analyst Barton Crockett [1][2] Company Overview - Stagwell Inc. is a global marketing company that specializes in performance media and data, digital transformation, creativity and communications, and consumer insights and strategy [4] - The Brand Performance Network segment includes creative media consulting and business-to-business marketing capabilities, while the Communications Network focuses on strategic corporate communications, advocacy, public relations, investor relations, and online fundraising services [4] Product Launch - On October 21, Stagwell announced the public launch of Agent Cloud, a secure and unified platform designed to simplify access to leading AI tools and marketing assistants [2] - Agent Cloud provides agencies and brands with instant access to top multimodal LLMs and image/video tools, streamlining the process by eliminating the need for multiple subscriptions [3]

Core Insights - The Marketing Cloud has launched Agent Cloud, a unified platform that provides secure access to leading AI tools and marketing assistants, aimed at simplifying the marketing process for brands and agencies [2][3]. Group 1: Product Features and Benefits - Agent Cloud offers a single entry point to top multimodal AI models, including GPT-5 and Gemini 2.5 Pro, eliminating the need for multiple subscriptions and ensuring compliance with client data requirements [3][4]. - The platform allows marketers to build, deploy, and manage AI-powered workflows across various teams, facilitating the creation of custom AI assistants that can be shared organization-wide [4][6]. - Key benefits include enhanced productivity, streamlined workflows, and the ability to innovate confidently while maintaining data security, as none of the organization's data is used to train any LLMs [8][6]. Group 2: Market Reception and Future Outlook - Early users of Agent Cloud have reported significant improvements in AI adoption and productivity, with some stating it has been a game-changer for their operations [7][6]. - The Marketing Cloud aims to provide organizations with the foundation needed to compete in an increasingly AI-driven landscape as they head into 2026 [6][8]. - The launch coincides with The Marketing Cloud's presence at the ANA Masters of Marketing event, highlighting its commitment to innovation in marketing technology [7].

Core Insights - Stagwell hosted the inaugural Future of News NewsFronts in New York, focusing on the productization, monetization, and innovation of news media [1][2] - CEO Mark Penn emphasized the importance of a thriving free press as essential for informed citizens and effective marketing [2] - The event featured discussions on storytelling in the age of AI and the need for bold marketing strategies [3] Event Highlights - The event included panels with industry leaders discussing challenges and opportunities in news media [3] - Notable speakers included Craig Brommers from American Eagle Outfitters, who advocated for taking bigger marketing risks [3] - A fireside chat featured Michael Barbaro from The New York Times discussing the creation of enduring news products [3] Future Initiatives - Stagwell announced a 35% ownership investment in RealClearPolitics during the NewsFronts event [8] - The company is expanding its Future of News initiative into the Asia-Pacific region with a summit in Singapore [9]

Core Insights - Stagwell has acquired a 35% stake in Real Clear Holdings LLC, which publishes RealClearPolitics and other news sites, reflecting its commitment to high-quality owned media and the belief in the commercial potential of journalism [1][2][3] Group 1: Investment and Strategy - The investment in RealClear is part of Stagwell's broader strategy to enhance its owned media platforms, including ReachTV, and is aligned with its Future of News initiative [1][2] - Stagwell's clients will gain access to RealClear's audience, op-ed aggregation, and polling capabilities, enhancing their marketing effectiveness [2][3] Group 2: Leadership Perspectives - Mark Penn, Stagwell's Chairman and CEO, emphasized that quality news can drive significant business results, indicating a strong belief in the value of quality journalism for businesses [3] - John McIntyre, CEO of Real Clear Holdings, expressed confidence in the partnership with Stagwell, highlighting the potential benefits for both audiences and stakeholders [4]

Core Insights - Stagwell expanded its Future of News initiative into the APAC region, hosting a summit in Singapore to unveil new research on news advertising [1][4] - The study involved nearly 10,000 respondents from Hong Kong, Japan, Singapore, and Vietnam, reinforcing the safety of brand advertising adjacent to quality news content [2][4] Research Findings - 74% of APAC adults are news readers, averaging 7.1 articles per day, with 21% identified as 'news junkies' who check news 7.2 times daily and read 9.4 articles [7] - The study found no brand safety concerns across key demographics, including News Junkies, Gen Z, Millennials, and university-educated adults [7] - Among highly educated respondents, purchase intent for brands advertising next to news articles on global politics and crime was 66%, compared to 64% for sports and 63% for business, indicating statistically insignificant differences [7] - For parents, purchase intent for brands advertising next to news articles on crime and entertainment was 77%, further supporting the safety of advertising in these contexts [7] Industry Perspectives - Mark Penn, Chairman and CEO of Stagwell, emphasized the critical role of trusted journalism in connecting brands with engaged audiences and enhancing business outcomes [4] - Kevin Huang, COO of South China Morning Post, highlighted the importance of brand suitability and the opportunity for brands to collaborate with trusted journalism to share authentic stories [6]

Core Viewpoint - Stagwell, a challenger network focused on transforming marketing, will report its financial results for Q3 2025 on November 6, 2025, before the market opens [1]. Group 1: Financial Reporting - Stagwell will host a video webcast to review its financial results on the same day at 8:30 AM (ET) [1]. - A replay of the webcast will be available on Stagwell's website after the event [1]. Group 2: Company Overview - Stagwell is a holding company designed to transform marketing, delivering scaled creative performance for ambitious brands [2]. - The company connects culture-moving creativity with advanced technology to harmonize marketing's art and science [2]. - Stagwell operates in over 45 countries, driven by a unified purpose to enhance effectiveness and improve business results for clients [2].