Advantage Solutions(ADV) - 2025 Q3 - Quarterly Results

Financial Performance - Revenues for Q3 2025 were $915 million, a decline of 2.6% compared to $939 million in Q3 2024[3] - Net income for the quarter was $21 million, a significant improvement from a net loss of $37 million in the prior year[3] - Adjusted EBITDA decreased by 1.4% to $100 million, with an adjusted EBITDA margin of 10.9%[5] - Revenues for Q3 2025 were $915,012,000, a decrease of 2.7% compared to $939,270,000 in Q3 2024[35] - Operating income from continuing operations was $40,160,000, compared to a loss of $3,177,000 in Q3 2024[35] - Net income from continuing operations was $20,565,000, compared to a loss of $37,320,000 in the same quarter last year[35] - Adjusted EBITDA from Continuing Operations was not explicitly stated but is a key performance metric for evaluating operational performance[33] - Adjusted EBITDA from continuing operations for the nine months ended September 30, 2025, was $244,142 thousand, down 6.6% from $261,458 thousand in 2024[43] - The company reported a net loss of $244,049 for the twelve months ended September 30, 2025, with LTM Adjusted EBITDA from Continuing and Discontinued Operations at $338,698[58] Revenue Segments - Experiential Services revenue grew by 10.2% year-over-year to $377.7 million, while Branded Services revenue fell by 12.8% to $288.8 million[8] - The Branded Services segment reported an operating income of $8,196 thousand for the three months ended September 30, 2025, compared to a loss of $12,210 thousand in 2024[46] - The Experiential Services segment achieved an operating income of $20,912 thousand for the three months ended September 30, 2025, a significant increase from $587 thousand in 2024[46] Cash Flow and Liquidity - The company generated $98 million in adjusted unlevered free cash flow, ending the quarter with a cash position of $201 million[2] - Cash provided by operating activities for the nine months ended September 30, 2025, was $15,902 thousand, compared to $78,009 thousand in 2024, indicating a decrease of 79.6%[41] - Cash provided by operating activities from continuing operations for the three months ended September 30, 2025, is $63,631[49] - Cash payments for interest during the same period amounted to $26,185, while cash payments for income taxes were $2,750[49] - Cash and cash equivalents were $201,137,000 as of September 30, 2025, slightly down from $205,233,000 at the end of 2024[38] - Cash, cash equivalents, and restricted cash at the end of the period were $213,248 thousand, slightly up from $212,469 thousand at the end of the same period in 2024[41] Debt and Financial Position - The net leverage ratio stands at 4.4x, with gross debt approximately $1.691 billion[14] - Total Net Debt as of September 30, 2025, is $1,474,271, with a Net Debt to LTM Adjusted EBITDA ratio of 4.4x[49] - The total debt as of September 30, 2025, is $1,675,408, after accounting for debt issuance costs of $15,737[49] - Net debt was not explicitly stated but is calculated as total debt minus cash and cash equivalents, providing insight into the company's financial condition[33] Cost Management - Selling, general, and administrative expenses decreased to $57,568,000 from $98,438,000 in Q3 2024, indicating improved cost management[35] - The company incurred stock-based compensation expenses of $20,483 thousand for the nine months ended September 30, 2025, down from $24,224 thousand in 2024[43] - The company incurred restructuring expenses of $6,864 and reorganization expenses of $53,265 over the twelve months ended September 30, 2025[58] Future Outlook - The outlook for 2025 projects revenues to decline in low-single digits and adjusted EBITDA to decrease in mid-single digits[16] - The company reaffirmed its revenue guidance but modestly lowered its adjusted EBITDA outlook due to divestiture impacts and macroeconomic challenges[7] - Strong demand in high-volume labor businesses contributed to improved margins despite ongoing macro headwinds in Branded Services[5] Asset Management - Total assets decreased to $2,993,522,000 as of September 30, 2025, from $3,106,517,000 at the end of 2024[38] - The accumulated deficit increased to $(2,707,617,000) from $(2,641,612,000) at the end of 2024, reflecting ongoing financial challenges[38] - The company recorded a gain on divestiture of $8,472 thousand for the nine months ended September 30, 2025[43] - The company reported gains and losses on disposal of assets related to divestitures, totaling $8,472 for the twelve months ended September 30, 2025[58] - The company has ongoing costs associated with the Take 5 Matter, amounting to $1,749 for the twelve months ended September 30, 2025[58]