Stagwell (STGW) Q2 Revenue Rises 5%

Core Insights - Stagwell reported Q2 2025 GAAP revenue of $707 million, exceeding analyst estimates of $693.77 million, marking a 5% year-over-year increase [1][2] - Adjusted EPS (non-GAAP) was $0.17, surpassing expectations by $0.01 and reflecting a 21.4% rise from the previous year [1][2] - The company experienced a GAAP net loss of $0.02 per share, an improvement from a loss of $0.03 in the same quarter last year [1][2] Financial Performance - Q2 2025 Adjusted EPS (non-GAAP) was $0.17, compared to estimates of $0.16 and $0.14 in Q2 2024, representing a 21.4% increase [2] - GAAP revenue reached $707 million, exceeding the estimate of $693.77 million and up from $671 million in Q2 2024, reflecting a 5.4% increase [2] - Net revenue (non-GAAP) was $598 million, an 8.0% increase from $554 million in Q2 2024 [2] - Adjusted EBITDA for Q2 2025 was $93 million, up 8.1% from $86 million in the prior year [2] Business Strategy and Focus - Stagwell is a technology-focused marketing network offering advertising, digital transformation, strategic communications, and data-driven services globally [3] - The company emphasizes digital transformation, investing in AI-enabled marketing and cloud platforms, and expanding its global footprint through acquisitions and partnerships [4] Segment Performance - Integrated Agencies Network segment saw a 7.2% year-over-year increase in net revenue and a 14.0% rise in adjusted EBITDA [6] - Brand Performance Network experienced a 1.4% decline in net revenue and a 12.0% decrease in adjusted EBITDA [6] - Communications Network reported a slight revenue increase but a 12.7% drop in profitability [6] - The All Other segment increased net revenue nearly sevenfold but continued to operate at a loss [6] Business Development and Client Growth - Stagwell achieved record net new business of $117 million in Q2 2025, following $130 million in Q1 2025, with a total of $451 million in net new business over the last twelve months [7] - The company reported strong performance among its top 25 customers, with revenue growth of 26% in Q2 2025 [9] Financial Outlook - Management reiterated FY2025 guidance, projecting approximately 8% net revenue growth, adjusted EBITDA of $410–$460 million, and adjusted EPS of $0.75–$0.88 [10] - The leadership team highlighted a strong pipeline of new business and continued demand for digital transformation services [10]