Executive Summary](index=1&type=section&id=Executive%20Summary) This section provides a high-level overview of Advantage Solutions' Q2 2025 consolidated financial performance, key strategic initiatives, and CEO commentary [Q2'25 Consolidated Financial Highlights](index=1&type=section&id=Q2%2725%20Consolidated%20Financial%20Highlights) Advantage Solutions reported stable revenues for Q2 2025 compared to the prior year, with a significant reduction in net loss. However, Adjusted EBITDA saw a slight decline. The company noted strong sequential improvement driven by resolving staffing shortfalls and continued strategic investments. Q2'25 Consolidated Financial Highlights (in thousands) | Metric | Three Months Ended June 30, 2025 (thousands) | Three Months Ended June 30, 2024 (thousands) | Change ($) (thousands) | Change (%) | | :----------------- | :------------------------------- | :------------------------------- | :--------- | :--------- | | Total Revenues | $873,707 | $873,357 | $350 | 0.0% | | Total Net Loss | $(30,440) | $(113,016) | $82,576 | (73.1%) | | Total Adjusted EBITDA | $86,412 | $89,898 | $(3,486) | (3.9%) | | Adjusted EBITDA Margin | 9.9% | 10.3% | | | | **Six Months Ended June 30,** | | | | | | Total Revenues | $1,695,499 | $1,734,769 | $(39,270) | (2.3%) | | Total Net Loss | $(86,570) | $(163,149) | $76,579 | NMF | | Total Adjusted EBITDA | $144,593 | $160,539 | $(15,946) | (9.9%) | | Adjusted EBITDA Margin | 8.5% | 9.3% | | | - Strong sequential improvement was driven by solid progress in resolving the staffing shortfall from the first quarter, coupled with continued strategic IT and capability investments[6](index=6&type=chunk) - The company maintains a strong balance sheet with ample liquidity, supported by **$103 million in cash** and an incremental **$23 million** received on July 31 related to a deferred purchase price installment for Jun Group[6](index=6&type=chunk) [CEO Commentary & Strategic Initiatives](index=1&type=section&id=CEO%20Commentary%20%26%20Strategic%20Initiatives) CEO Dave Peacock expressed satisfaction with the progress of transformation initiatives aimed at enhancing client sales and optimizing ROI. He highlighted the resolution of first-quarter staffing shortfalls, leading to improved sequential performance, and reaffirmed the 2025 guidance with expectations for stronger financial performance and cash generation in the second half of the year. - Advancing transformation initiatives to accelerate AI enablement and improved business insights[1](index=1&type=chunk) - Largely resolved the staffing shortfall from the first quarter, resulting in increased execution for improved sequential performance in the second quarter[5](index=5&type=chunk) - Reaffirming 2025 guidance with the expectation of delivering stronger performance and cash generation in the second half of the year, considering current market conditions and operational execution plans[1](index=1&type=chunk)[5](index=5&type=chunk) Segment Performance Overview](index=2&type=section&id=Segment%20Performance%20Overview) This section details the financial performance of the Branded Services, Experiential Services, and Retailer Services segments, highlighting revenue and Adjusted EBITDA trends. [Branded Services](index=2&type=section&id=Branded%20Services) The Branded Services segment experienced declines in revenue and Adjusted EBITDA for both the three and six months ended June 30, 2025, primarily due to market headwinds and client investment reductions. Despite this, operating loss significantly improved year-over-year. Branded Services Segment Financial Performance (in thousands) | Metric | Q2 2025 (thousands) | Q2 2024 (thousands) | YoY Change (%) | YTD 2025 (thousands) | YTD 2024 (thousands) | YTD Change (%) | | :----------------- | :----------- | :----------- | :------------- | :------------ | :------------ | :------------- | | Revenues | 295,221 | 322,340 | (8.4%) | 585,062 | 651,394 | (10.2%) | | Operating (Loss) Income | (10,540) | (107,280) | 90.2% | (25,862) | (129,398) | NMF | | Adjusted EBITDA | 34,042 | 42,856 | (20.6%) | 61,987 | 77,191 | (19.7%) | - Market headwinds and client investment reductions negatively impacted brokerage and omni-commerce marketing services[8](index=8&type=chunk) - Expect improved H2'25 performance from previous new business wins, leveraging new capabilities, and streamlined operations[8](index=8&type=chunk) [Experiential Services](index=2&type=section&id=Experiential%20Services) Experiential Services demonstrated strong growth in Q2 2025, with increased revenues, operating income, and Adjusted EBITDA. This performance was attributed to improved staffing levels and solid execution of a greater number of events. Experiential Services Segment Financial Performance (in thousands) | Metric | Q2 2025 (thousands) | Q2 2024 (thousands) | YoY Change (%) | YTD 2025 (thousands) | YTD 2024 (thousands) | YTD Change (%) | | :----------------- | :----------- | :----------- | :------------- | :------------ | :------------ | :------------- | | Revenues | 347,706 | 319,508 | 8.8% | 661,726 | 626,859 | 5.6% | | Operating (Loss) Income | 10,859 | 6,453 | 68.3% | 7,355 | 2,811 | 161.7% | | Adjusted EBITDA | 25,886 | 22,611 | 14.5% | 37,955 | 39,304 | (3.4%) | - Improved staffing levels and solid execution of a greater number of events led to year-over-year growth[8](index=8&type=chunk) - Events per day grew **1%** (up **5%** excluding a client loss) compared to the prior year, with an execution rate of approximately **93%**[8](index=8&type=chunk) - Demand signals remain favorable in the upcoming peak seasonal period[8](index=8&type=chunk) [Retailer Services](index=2&type=section&id=Retailer%20Services) Retailer Services showed stable revenue performance in Q2 2025, with slight declines, but achieved growth in operating income and Adjusted EBITDA. This was driven by staffing recovery and increased project activity, including some pull-forward from Q3'25. Retailer Services Segment Financial Performance (in thousands) | Metric | Q2 2025 (thousands) | Q2 2024 (thousands) | YoY Change (%) | YTD 2025 (thousands) | YTD 2024 (thousands) | YTD Change (%) | | :----------------- | :----------- | :----------- | :------------- | :------------ | :------------ | :------------- | | Revenues | 230,780 | 231,509 | (0.3%) | 448,711 | 456,516 | (1.7%) | | Operating (Loss) Income | 9,692 | 9,568 | 1.3% | 13,897 | 5,378 | 158.4% | | Adjusted EBITDA | 26,484 | 24,431 | 8.4% | 44,651 | 44,044 | 1.4% | - Staffing recovery and increased project activity, including a pull forward from Q3'25, led to growth versus the prior year[8](index=8&type=chunk) - Financial results were affected by a client loss in H2'24 that will be largely lapped in Q3'25[8](index=8&type=chunk) - Customer demand remains favorable for merchandising services[8](index=8&type=chunk) Financial Position and Outlook](index=3&type=section&id=Financial%20Position%20and%20Outlook) This section outlines the company's cash flow and balance sheet highlights, along with the reaffirmed fiscal year 2025 financial guidance. [Cash Flow and Balance Sheet Highlights](index=3&type=section&id=Cash%20Flow%20and%20Balance%20Sheet%20Highlights) Advantage Solutions reported an Adjusted Unlevered Free Cash Flow of $57 million for the period ended June 30, 2025, representing 66% of Adjusted EBITDA. The company maintains a strong balance sheet with $103 million in cash and a net leverage ratio of 4.6x. Cash Flow and Balance Sheet Highlights (in millions) | Metric | Period Ended June 30, 2025 (millions) | | :---------------------------------- | :------------------------------------ | | Adjusted Unlevered Free Cash Flow | $57 | | % of Adjusted EBITDA | 66% | | Capex | ~$2 | | Gross Debt | ~$1,694 | | Cash and Cash Equivalents | ~$103 | | Net Leverage Ratio (1) | 4.6x | - Maintaining a strong balance sheet with ample liquidity supported by **$103 million in cash** and an incremental **$23 million** received on July 31 related to the first of two deferred purchase price installments for Jun Group[6](index=6&type=chunk) [Fiscal Year 2025 Outlook](index=3&type=section&id=Fiscal%20Year%202025%20Outlook) The company reaffirmed its fiscal year 2025 outlook, expecting revenues and Adjusted EBITDA to be down low single digits to flat. Adjusted Unlevered Free Cash Flow conversion is projected to be greater than 50% of Adjusted EBITDA, with a revised Capex guidance of $50 to $60 million. Fiscal Year 2025 Outlook (in millions) | Metric | Fiscal Year 2025 Outlook (millions) | | :---------------------------------- | :------------------------------------ | | Revenues | Down Low Single Digits to Flat | | Adjusted EBITDA | Down Low Single Digits to Flat | | Adjusted Unlevered Free Cash Flow (1) Conversion | >50% of Adjusted EBITDA | | Net Interest Expense | $140 to $150 | | Capex | $50 to $60 (prior guidance was $65 to $75) | - 2025 revenue outlook excludes pass-through costs. 2025 guidance compares to 2024 on a continuing operations basis[14](index=14&type=chunk) Company Information & Disclosures](index=3&type=section&id=Company%20Information%20%26%20Disclosures) This section provides an overview of Advantage Solutions, includes cautionary statements regarding forward-looking information, and lists investor relations contacts. [About Advantage Solutions](index=4&type=section&id=About%20Advantage%20Solutions) Advantage Solutions is a leading omnichannel retail solutions agency in North America, leveraging data and technology to help CPG brands and retailers drive demand and get products to consumers. The company offers services such as in-store and online experiences, assortment optimization, and e-commerce acceleration. - Advantage Solutions is the leading omnichannel retail solutions agency in North America, positioned at the intersection of consumer-packaged goods (CPG) brands and retailers[19](index=19&type=chunk) - Leverages data- and technology-powered services, unparalleled insights, expertise, and scale to help brands and retailers generate demand and get products to consumers[19](index=19&type=chunk) - Services include creating in-store and online experiences, optimizing assortment and merchandising, and accelerating e-commerce and digital capabilities[19](index=19&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This section serves as a cautionary note regarding forward-looking statements in the press release, emphasizing that such statements are based on current expectations and assumptions, but are subject to inherent risks and uncertainties that could cause actual results to differ materially. The company disclaims any obligation to update these statements. - Forward-looking statements relate to future events or Advantage's future financial or operating performance and are identified by words like "may", "should", "expect", "intend", "will", etc[21](index=21&type=chunk) - These statements are based on current expectations and assumptions but are inherently uncertain and subject to risks that could cause actual results to differ materially[21](index=21&type=chunk)[22](index=22&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking statements, and Advantage assumes no obligation to update or revise them, except as required by law[22](index=22&type=chunk) [Investor Relations](index=3&type=section&id=Investor%20Relations) This section provides details for the Q2 2025 earnings conference call, including date, time, dial-in information, and webcast availability. It also lists contact information for investor and media inquiries. Q2 2025 Earnings Conference Call Details | Conference Call Detail | Information | | :--------------------- | :------------------------------------ | | Date/Time | August 7, 2025, 8:30 am EDT | | Dial-in (US) | 800-715-9871 | | Dial-in (International)| +1-646-307-1963 | | Conference ID | 5720569 | | Webcast | ADV 2Q 2025 Earnings Webcast | | Replay (US) | 800-770-2030 | | Replay (International) | +1-609-800-9909 | | Playback ID | 5720569 | - Investor Contact: Ruben Mella, CFA (investorrelations@youradv.com)[16](index=16&type=chunk) - Media Contact: Jeff Levine (press@youradv.com)[16](index=16&type=chunk) Non-GAAP Financial Measures](index=5&type=section&id=Non-GAAP%20Financial%20Measures) This section defines and explains the purpose of various non-GAAP financial measures used by the company, including Adjusted EBITDA and Adjusted Unlevered Free Cash Flow. [Definitions of Non-GAAP Measures](index=5&type=section&id=Definitions%20of%20Non-GAAP%20Measures) This section clarifies that certain financial measures presented, such as Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Unlevered Free Cash Flow, and Net Debt, are non-GAAP. It provides detailed definitions for each, outlining the specific adjustments made to GAAP measures, and explains their purpose in providing useful information to management and investors for evaluating operating results and trends. - Non-GAAP measures are not substitutes for or superior to GAAP measures and should not be considered in isolation[25](index=25&type=chunk) - Adjusted EBITDA from Continuing Operations, Adjusted EBITDA from Discontinued Operations, and Adjusted EBITDA by Segment are supplemental non-GAAP measures of operating performance, adjusting net (loss) income for items like interest, taxes, depreciation, amortization, impairment, and various non-recurring expenses[27](index=27&type=chunk)[28](index=28&type=chunk) - Adjusted Unlevered Free Cash Flow represents net cash from operating activities less capital expenditures, further adjusted for cash payments for interest, taxes, acquisition/divestiture expenses, restructuring, reorganization, and other items[30](index=30&type=chunk) - Net Debt represents total debt less cash and cash equivalents and debt issuance costs, providing insight into the company's capital structure and credit quality[33](index=33&type=chunk) Condensed Consolidated Financial Statements](index=6&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the company's condensed consolidated statements of operations, balance sheet, and cash flows for the reported periods. [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The Condensed Consolidated Statements of Operations detail Advantage Solutions' financial performance for the three and six months ended June 30, 2025 and 2024. It shows a significant reduction in net loss from continuing operations year-over-year, despite relatively stable revenues, driven by lower operating expenses and the absence of goodwill impairment in 2025. Condensed Consolidated Statements of Operations (in thousands) | (in thousands, except share and per share data) | Three Months Ended June 30, 2025 (thousands) | Three Months Ended June 30, 2024 (thousands) | Six Months Ended June 30, 2025 (thousands) | Six Months Ended June 30, 2024 (thousands) | | :---------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenues | $873,707 | $873,357 | $1,695,499 | $1,734,769 | | Total operating expenses | 863,696 | 964,616 | 1,700,109 | 1,855,978 | | Operating income (loss) from continuing operations | 10,011 | (91,259) | (4,610) | (121,209) | | Net loss from continuing operations | (30,440) | (113,016) | (86,570) | (163,149) | | Net loss | (30,440) | (100,835) | (86,570) | (103,950) | | Basic loss per common share from continuing operations | $(0.09) | $(0.35) | $(0.27) | $(0.51) | - Impairment of goodwill and indefinite-lived asset was **$0** in Q2 2025, compared to **$99,670 thousand** in Q2 2024, contributing significantly to the improved operating income[35](index=35&type=chunk) [Condensed Consolidated Balance Sheet](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheet) The Condensed Consolidated Balance Sheet presents the company's financial position as of June 30, 2025, compared to December 31, 2024. It shows a decrease in cash and cash equivalents, a rise in accounts receivable, and a slight reduction in total assets and total liabilities, while stockholders' equity also decreased. Condensed Consolidated Balance Sheet (in thousands) | (in thousands) | June 30, 2025 (thousands) | December 31, 2024 (thousands) | | :---------------------------------------------- | :------------ | :---------------- | | Cash and cash equivalents | $102,869 | $205,233 | | Accounts receivable, net | 673,258 | 603,069 | | Total current assets | 926,709 | 910,738 | | Total assets | 3,028,790 | 3,106,517 | | Total current liabilities | 473,358 | 460,062 | | Long-term debt, net of current portion | 1,663,700 | 1,686,690 | | Total liabilities | 2,345,216 | 2,357,782 | | Total stockholders' equity | 683,574 | 748,735 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) The Consolidated Statements of Cash Flows for the six months ended June 30, 2025, show a shift from cash provided by operating activities in 2024 to cash used in 2025. Investing activities continued to use cash, while financing activities also resulted in a net cash outflow, leading to an overall net decrease in cash, cash equivalents, and restricted cash. Consolidated Statements of Cash Flows (in thousands) | (in thousands) | Six Months Ended June 30, 2025 (thousands) | Six Months Ended June 30, 2024 (thousands) | | :---------------------------------------------- | :----------------------------- | :----------------------------- | | Net cash (used in) provided by operating activities | $(47,728) | $44,055 | | Net cash (used in) provided by investing activities | $(20,677) | $110,867 | | Net cash used in financing activities | $(28,368) | $(114,533) | | Net change in cash, cash equivalents and restricted cash | $(100,548) | $37,810 | | Cash, cash equivalents and restricted cash, end of period | $120,203 | $169,370 | - The significant change in net cash from investing activities is largely due to proceeds from divestitures of **$146,828 thousand** in 2024, with no comparable proceeds in 2025[40](index=40&type=chunk) Reconciliation of Non-GAAP Measures](index=9&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) This section provides detailed reconciliations of GAAP net loss and operating income to various non-GAAP measures, including Adjusted EBITDA and Adjusted Unlevered Free Cash Flow. [Reconciliation of Net Loss to Adjusted EBITDA (Continuing Operations)](index=9&type=section&id=Reconciliation%20of%20Net%20Loss%20to%20Adjusted%20EBITDA%20%28Continuing%20Operations%29) This section provides a detailed reconciliation of Net Loss from Continuing Operations to Adjusted EBITDA for the three and six months ended June 30, 2025 and 2024. Key adjustments include interest expense, taxes, depreciation and amortization, and the absence of goodwill impairment in 2025, which significantly improved the adjusted metric. Reconciliation of Net Loss to Adjusted EBITDA (Continuing Operations) (in thousands) | (in thousands) | Q2 2025 (thousands) | Q2 2024 (thousands) | YTD 2025 (thousands) | YTD 2024 (thousands) | | :---------------------------------------------- | :------ | :------ | :------- | :------- | | Net loss from continuing operations | $(30,440) | $(113,016) | $(86,570) | $(163,149) | | Add: Interest expense, net | 35,814 | 39,754 | 70,174 | 75,515 | | Add: Provision for (benefit from) income taxes | 4,621 | (17,311) | 11,760 | (33,176) | | Add: Depreciation and amortization | 50,698 | 51,317 | 101,059 | 101,065 | | Add: Impairment of goodwill | — | 99,670 | — | 99,670 | | Add: Stock-based compensation expense | 6,584 | 7,528 | 13,069 | 16,082 | | Add: Reorganization expenses | 16,434 | 20,291 | 28,674 | 55,343 | | Adjusted EBITDA from Continuing Operations | $86,412 | $89,898 | $144,593 | $160,539 | [Reconciliation of Adjusted EBITDA (Discontinued Operations)](index=9&type=section&id=Reconciliation%20of%20Adjusted%20EBITDA%20%28Discontinued%20Operations%29) This section reconciles Net Income from Discontinued Operations to Adjusted EBITDA for the three and six months ended June 30, 2024. Key adjustments include the gain on divestitures, which significantly impacted the reported net income, and other non-recurring expenses. Reconciliation of Adjusted EBITDA (Discontinued Operations) (in thousands) | (in thousands) | Q2 2024 (thousands) | YTD 2024 (thousands) | | :---------------------------------------------- | :------ | :------- | | Net income from discontinued operations, net of tax | $12,181 | $59,199 | | Add: Interest expense, net | 16 | 48 | | Add: Provision for income taxes | (2,377) | 11,860 | | Add: Depreciation and amortization | 1,883 | 4,491 | | Less: Gain on divestitures | (13,179) | (70,195) | | Add: Reorganization expenses | 5,211 | 7,285 | | Adjusted EBITDA from Discontinued Operations | $7,938 | $16,057 | [Reconciliation of Operating Income (Loss) to Adjusted EBITDA by Segment](index=10&type=section&id=Reconciliation%20of%20Operating%20Income%20%28Loss%29%20to%20Adjusted%20EBITDA%20by%20Segment) This section provides a detailed reconciliation of Operating Income (Loss) to Adjusted EBITDA for each of the Branded Services, Experiential Services, and Retailer Services segments for the three and six months ended June 30, 2025 and 2024. Adjustments primarily include depreciation and amortization, stock-based compensation, and reorganization expenses. Reconciliation of Operating Income (Loss) to Adjusted EBITDA by Segment (in thousands) **Branded Services Segment** | (in thousands) | Q2 2025 (thousands) | Q2 2024 (thousands) | YTD 2025 (thousands) | YTD 2024 (thousands) | | :---------------------------------------------- | :------ | :------ | :------- | :------- | | Operating loss | $(10,540) | $(107,280) | $(25,862) | $(129,398) | | Add: Depreciation and amortization | 31,561 | 32,327 | 63,023 | 64,314 | | Add: Impairment of goodwill | — | 99,670 | — | 99,670 | | Add: Reorganization expenses | 7,741 | 9,248 | 13,196 | 22,904 | | Branded Services segment Adjusted EBITDA | $34,042 | $42,856 | $61,987 | $77,191 | **Experiential Services Segment** | (in thousands) | Q2 2025 (thousands) | Q2 2024 (thousands) | YTD 2025 (thousands) | YTD 2024 (thousands) | | :---------------------------------------------- | :------ | :------ | :------- | :------- | | Operating income | $10,859 | $6,453 | $7,355 | $2,811 | | Add: Depreciation and amortization | 10,684 | 11,015 | 21,221 | 20,935 | | Add: Reorganization expenses | 2,548 | 3,472 | 6,129 | 11,724 | | Experiential Services segment Adjusted EBITDA | $25,886 | $22,611 | $37,955 | $39,304 | **Retailer Services Segment** | (in thousands) | Q2 2025 (thousands) | Q2 2024 (thousands) | YTD 2025 (thousands) | YTD 2024 (thousands) | | :---------------------------------------------- | :------ | :------ | :------- | :------- | | Operating income | $9,692 | $9,568 | $13,897 | $5,378 | | Add: Depreciation and amortization | 8,453 | 7,975 | 16,815 | 15,816 | | Add: Reorganization expenses | 6,145 | 7,571 | 9,349 | 20,715 | | Retailer Services segment Adjusted EBITDA | $26,484 | $24,431 | $44,651 | $44,044 | [Net Debt and Adjusted Unlevered Free Cash Flow Reconciliation](index=11&type=section&id=Net%20Debt%20and%20Adjusted%20Unlevered%20Free%20Cash%20Flow%20Reconciliation) This section provides a reconciliation of total debt to Net Debt and calculates the Net Debt / LTM Adjusted EBITDA ratio as of June 30, 2025. It also reconciles net cash used in operating activities to Adjusted Unlevered Free Cash Flow for the three months ended June 30, 2025, showing a conversion rate of 65.8%. Net Debt and Adjusted Unlevered Free Cash Flow Reconciliation (in thousands) **Net Debt Calculation** | (amounts in thousands) | June 30, 2025 (thousands) | | :---------------------------------------------- | :------------ | | Current portion of long-term debt | $13,250 | | Long-term debt, net of current portion | 1,681,207 | | Less: Debt issuance costs | 17,507 | | Total debt | 1,676,950 | | Less: Cash and cash equivalents | 102,869 | | Total Net Debt | $1,574,081 | | LTM Adjusted EBITDA from Continuing and Discontinued Operations | $342,370 | | Net Debt / LTM Adjusted EBITDA ratio | 4.6x | **Adjusted Unlevered Free Cash Flow Reconciliation** | (amounts in thousands) | Three Months Ended June 30, 2025 (thousands) | | :---------------------------------------------- | :------------------------------- | | Net cash used in operating activities from continuing and discontinued operations | $(8,102) | | Less: Purchase of property and equipment | (2,115) | | Add: Cash payments for interest | 43,764 | | Add: Cash payments for income taxes | 9,942 | | Add: Cash paid for reorganization expenses | 8,120 | | Adjusted Unlevered Free Cash Flow | $56,835 | | Adjusted Unlevered Free Cash Flow as a percentage of Adjusted EBITDA | 65.8% | [LTM Adjusted EBITDA Reconciliation & Non-GAAP Footnotes](index=12&type=section&id=LTM%20Adjusted%20EBITDA%20Reconciliation%20%26%20Non-GAAP%20Footnotes) This section provides the reconciliation of net loss to LTM Adjusted EBITDA from continuing and discontinued operations for the twelve months ended June 30, 2025. It also includes detailed footnotes explaining the various adjustments made to non-GAAP measures, such as stock-based compensation, acquisition/divestiture expenses, restructuring, and reorganization costs. LTM Adjusted EBITDA Reconciliation (in thousands) | (in thousands) | Twelve Months Ended June 30, 2025 (thousands) | | :---------------------------------------------- | :-------------------------------- | | Net loss | $(307,390) | | Add: Interest expense, net | 141,451 | | Add: Provision for income taxes | 11,607 | | Add: Depreciation and amortization | 204,751 | | Add: Impairment of goodwill and indefinite-lived asset | 175,500 | | Less: Gain on divestitures | (24,904) | | Add: Stock-based compensation expense | 26,430 | | Add: Reorganization expenses | 64,381 | | LTM Adjusted EBITDA from Continuing and Discontinued Operations | $342,370 | - Adjustments to non-GAAP measures include non-cash compensation, equity-based compensation, fair value adjustments for contingent consideration, acquisition and divestiture related expenses, restructuring expenses, reorganization expenses, litigation expenses, COVID-19 benefits, and costs associated with the Take 5 Matter[50](index=50&type=chunk)[51](index=51&type=chunk)[52](index=52&type=chunk)[53](index=53&type=chunk)[54](index=54&type=chunk)

Core Insights - Advantage Solutions Inc. reported a slight increase in revenues for Q2 2025, totaling $874 million, compared to $873 million in Q2 2024, while significantly reducing its net loss from $113 million to $30 million, marking a 73.1% improvement [3][7][24] - The company is advancing its transformation initiatives to enhance AI capabilities and improve business insights, expecting stronger financial performance and cash generation in the second half of the year [1][5] - Advantage Solutions reaffirmed its 2025 guidance, indicating confidence in its operational execution and market conditions [1][5] Financial Performance - Total revenues for the six months ended June 30, 2025, were $1.695 billion, down 2.3% from $1.735 billion in the same period of 2024 [3][7] - Adjusted EBITDA for Q2 2025 was $86 million, a decline of 3.9% from $89.9 million in Q2 2024, with an adjusted EBITDA margin of 9.9% [3][7][24] - The company maintained a strong balance sheet with $103 million in cash and received an additional $23 million related to deferred purchase price installments [7] Operational Highlights - The company resolved staffing shortages from Q1, leading to improved execution and performance in Q2 [5][7] - Strategic investments in IT and capabilities are ongoing to enhance services for clients [7] - The company expects adjusted unlevered free cash flow conversion to exceed 50% of adjusted EBITDA for 2025 [8] 2025 Guidance - The revenue outlook for 2025 is expected to be flat to low single digits down, with adjusted EBITDA also projected to decline in a similar range [8] - Net interest expense is anticipated to be between $140 million and $150 million, with capital expenditures projected at $50 million to $60 million [8]

Group 1 - Advantage Solutions Inc. will participate in the Canaccord Genuity 45th Annual Growth Conference in Boston on August 12, 2025, with a live fireside chat featuring CEO Dave Peacock [1] - The webcast of the event will be available on the Advantage Solutions website [1] - For further inquiries, contact Canaccord Genuity representatives [1] Group 2 - Advantage Solutions is the leading omnichannel retail solutions agency in North America, positioned at the intersection of consumer-packaged goods brands and retailers [2] - The company utilizes data- and technology-powered services to help brands and retailers generate demand and distribute products effectively [2] - Advantage Solutions offers a range of services including in-store and online experiences, assortment optimization, and e-commerce acceleration [2] - The company has a presence throughout North America and strategic investments in select international markets [2]

Company Overview - Advantage Solutions Inc. is the leading omnichannel retail solutions agency in North America, positioned at the intersection of consumer-packaged goods brands and retailers [4] - The company utilizes data- and technology-powered services to provide insights, expertise, and scale to help brands and retailers generate demand and deliver products to consumers [4] - Advantage Solutions offers services that include optimizing assortment and merchandising, enhancing e-commerce and digital capabilities, and creating meaningful in-store and online experiences [4] Upcoming Financial Results - Advantage Solutions will release its financial results for the second quarter on August 7, 2025, at 7 a.m. EDT [1] - A conference call will follow at 8:30 a.m. EDT on the same day to discuss the results [1] Conference Call Details - The conference call can be accessed by U.S. callers at 1-800-715-9871 and international callers at 1-646-307-1963, with a conference ID of 5720569 [2] - A replay of the call will be available approximately three hours after it concludes, accessible at 1-800-770-2030 for U.S. callers and 1-609-800-9909 for international callers, with playback ID 5720569 [2] - The replay will be available until August 14, 2025 [2] Investor Relations - Interested parties can listen to a simultaneous conference call webcast by visiting the Investor Relations section of the Advantage Solutions website [3] - The online replay will be available for a limited time shortly after the call [3]

Company Overview - Advantage Solutions ranks as the 12 largest agency in the United States and No. 18 worldwide according to the Ad Age Agency Report 2025, with a revenue of $1.2 billion in 2024 [1] - The company is recognized for its omnichannel retail solutions, uniquely positioned at the intersection of consumer-packaged goods (CPG) brands and retailers [6] Industry Trends - The Ad Age Agency Report identifies three major trends in 2025: AI reshaping creativity, evolving client expectations, and agencies being asked to do more with greater precision and agility [3] Client Engagement and Services - Advantage Solutions emphasizes its ability to unify sales and marketing, delivering an award-winning shopper experience and redefining possibilities across omnicommerce [4] - The company continues to strengthen its relationship with Amazon, receiving the inaugural Gold Tier award for excellence in on-time, accurate delivery [5] Strategic Positioning - Advantage Solutions leverages data and technology-powered services to help brands and retailers generate demand and connect with consumers across various shopping platforms [6]

Core Insights - Advantage Solutions Inc. ranks as the 9th largest agency in North America and 18th globally, with a revenue of $1.2 billion in 2024, making it one of only two Midwest-based agencies in the top 25 list [1] - The company is recognized for its innovative approach in shaping shopping experiences and delivering high-tech, high-touch solutions to clients [2] - The Ad Age Agency Report highlights three major trends for 2025: AI reshaping creativity, evolving client expectations, and the demand for greater precision and agility from agencies [3] Company Overview - Advantage Solutions is positioned at the intersection of consumer-packaged goods (CPG) brands and retailers, providing a full suite of omnichannel services including branding, retail media, creative services, and e-commerce solutions [5][6] - The company has established a strong relationship with Amazon, receiving the inaugural Gold Tier award for excellence in delivery [5] - Advantage leverages data and technology to optimize consumer experiences both in-store and online, enhancing e-commerce capabilities and driving demand for brands [6]

Summary of Key Points Core Viewpoint - Advantage Solutions (NASDAQ: ADV) is experiencing significant stock price pressure, with the stock recently hitting an all-time low of $1.09, reminiscent of its previous struggles in 2023 when it dipped to $1.15 in April [1]. Company Performance - The stock price of Advantage Solutions has shown volatility, testing the $1 mark again after previously reaching a low of $1.15 in April 2023 [1]. - The current all-time low of $1.09 indicates ongoing challenges for the company in maintaining investor confidence and market stability [1]. Historical Context - The company has a history of stock price fluctuations, with the recent decline reflecting a pattern observed over the past two years [1]. - The reference to the stock nearing $1 again suggests a potential trend that investors may need to monitor closely [1].

Core Points - Advantage Solutions Inc. is providing financial assistance and mobilizing employee volunteers to support recovery efforts after recent tornadoes in St. Louis [1][2] - The company is donating $25,000 to the Urban League of Metropolitan St. Louis for emergency relief efforts [2] - Advantage Solutions is committed to supporting its employees affected by the disaster through grants and access to an Employee Assistance Program [3] Company Initiatives - The support for the Urban League is part of a multi-year partnership that includes the Save Our Sisters Fund, which offers various services to empower women [4] - Advantage Solutions positions itself as a leading omnichannel retail solutions agency in North America, leveraging data and technology to assist brands and retailers [5] Urban League Overview - The Urban League of Metropolitan St. Louis aims to empower African Americans and others in the region, focusing on economic self-reliance and social equality [6]

Financial Performance - Revenues decreased by $39.6 million, or 4.6%, to $821.8 million for the three months ended March 31, 2025 compared to the same period in 2024[95] - Operating loss from continuing operations decreased by $15.3 million to $14.6 million[95] - Net loss from continuing operations increased by $6.0 million to $56.1 million[95] - Adjusted Net Income decreased by $25.3 million, or 274.5%, to $16.1 million[95] - Adjusted EBITDA from Continuing Operations decreased by $12.5 million or 17.6%, to $58.2 million[95] - Total revenues decreased by $39.6 million, or 4.6%, to $821.8 million for the three months ended March 31, 2025, compared to $861.4 million for the same period in 2024[119] - Net loss from continuing operations for Q1 2025 was $(56,130) thousand, compared to $(50,133) thousand in Q1 2024, indicating a worsening financial performance[144] - Adjusted EBITDA from Continuing Operations for Q1 2025 was $58,181 thousand, down from $70,639 thousand in Q1 2024, showing a decline of approximately 17.6%[144] - The Branded Services segment reported an Adjusted EBITDA of $27,945 thousand in Q1 2025, down from $34,334 thousand in Q1 2024, a decrease of about 18.5%[146] - The Experiential Services segment's Adjusted EBITDA decreased to $12,069 thousand in Q1 2025 from $16,692 thousand in Q1 2024, representing a decline of approximately 27.6%[146] - The Retailer Services segment achieved an Adjusted EBITDA of $18,167 thousand in Q1 2025, slightly down from $19,613 thousand in Q1 2024, a decrease of about 7.4%[146] Segment Performance - Branded Services segment generated approximately 35.3% of revenues in Q1 2025, down from 38.2% in Q1 2024[90] - Experiential Services segment generated approximately 38.2% of revenues in Q1 2025, up from 35.7% in Q1 2024[91] - Retailer Services segment generated approximately 26.5% of revenues in Q1 2025, slightly up from 26.1% in Q1 2024[92] - The Branded Services segment revenues decreased by $39.2 million, or 11.9%, primarily due to a weaker economic environment and an intentional client resignation[120] - The Experiential Services segment revenues increased by $6.7 million, or 2.2%, driven by an increase in events per day volume[121] - The Retailer Services segment revenues decreased by $7.1 million, or 3.1%, primarily due to staffing challenges[122] Cost Management and Restructuring - Selling, general, and administrative expenses decreased to 7.9% of revenues, down from 10.3% in the prior year, due to a $22.8 million reduction in internal reorganization costs[124] - The company announced a restructuring plan in July 2024 to improve cost structure and operational efficiency, with substantial completion expected by the end of fiscal year 2024[113] - Restructuring expenses for Q1 2025 amounted to $931 thousand, compared to no such expenses in Q1 2024, indicating increased costs related to operational adjustments[144] Cash Flow and Liquidity - Net cash used in operating activities for Q1 2025 was $39.6 million, compared to $9.4 million in Q1 2024, reflecting a significant increase in accounts receivable[150] - Net cash used in investing activities in Q1 2025 was $18.4 million, primarily due to the purchase of property and equipment related to the enterprise resource planning initiative[152] - Net cash used in financing activities for Q1 2025 was $22.1 million, primarily related to repurchases of Notes totaling $18.2 million[153] - The company’s cash flow from operating activities was negatively impacted by an increase in accounts receivable in Q1 2025 compared to a decrease in Q1 2024[151] - The company’s principal sources of liquidity include cash receipts for services performed and borrowings under the Revolving Credit Facility[149] - As of March 31, 2025, the company held $67.5 million in cash and cash equivalents outside the United States, an increase from $65.0 million as of December 31, 2024[180] Debt and Interest Management - The Revolving Credit Facility has an aggregate principal amount of up to $500 million, with $451 million available as of March 31, 2025[156] - The Term Loan Facility has an aggregate principal amount of $1.1 billion, with borrowings amortizing at 1% per annum of the original issued amount[163] - The company recognized a gain of $1.8 million on the repurchase of Notes during Q1 2025, classified under interest expense[171] - The company may refinance existing debt or enter into additional interest rate cap agreements to manage interest rate risk in the future[197] - The company has interest rate collar contracts with an aggregate notional value of $700.0 million as of March 31, 2025, to manage interest rate exposure[195] - The company has entered into interest rate collar agreements to manage exposure to potential interest rate increases, with a net liability of $0.8 million as of March 31, 2025[195] Legal and Compliance - Litigation expenses increased to $523 thousand in Q1 2025 from $284 thousand in Q1 2024, indicating rising legal costs[137] - The company recorded a deferred tax liability of approximately $0.6 million for unremitted earnings in Canada, indicating a need for tax planning regarding foreign earnings[181] - The company is evaluating the impact of new accounting standards on its consolidated financial statements, including ASU 2023-09 and ASU 2024-03[186][188] - The company has no off-balance sheet financing arrangements or liabilities, ensuring transparency in its financial position[182] - The company has no majority-owned subsidiaries excluded from consolidated financial statements, ensuring comprehensive financial reporting[182] Other Financial Metrics - Interest expense decreased by $1.4 million, or 3.9%, to $34.4 million for the three months ended March 31, 2025, primarily due to a lower debt balance[130] - Equity-based compensation of Karman Topco L.P. was $(1,524) thousand in Q1 2025, a significant change from $390 thousand in Q1 2024, reflecting a shift in compensation strategy[137] - The company reported a fair value adjustment related to contingent consideration of $0 in Q1 2025, down from $778 thousand in Q1 2024, suggesting changes in acquisition-related liabilities[144] - A 10% unfavorable change in foreign exchange rates could have decreased the company's consolidated loss before taxes by approximately $0.8 million for the three months ended March 31, 2025[192] - The company expects existing domestic cash and cash flows to be sufficient to fund operations and cash commitments for at least the next 12 months[181]

Company Performance - Advantage Solutions Inc. reported a quarterly loss of $0.12 per share, missing the Zacks Consensus Estimate of $0.06, and showing an improvement from a loss of $0.16 per share a year ago, resulting in an earnings surprise of -300% [1] - The company posted revenues of $821.79 million for the quarter ended March 2025, which was 3.96% below the Zacks Consensus Estimate and a decrease from year-ago revenues of $879 million [2] - Over the last four quarters, Advantage Solutions has not surpassed consensus EPS estimates and has topped consensus revenue estimates only once [2] Stock Performance - Advantage Solutions shares have declined approximately 49.7% since the beginning of the year, contrasting with the S&P 500's decline of -3.8% [3] - The current Zacks Rank for Advantage Solutions is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.10 on revenues of $886.99 million, and for the current fiscal year, it is $0.42 on revenues of $3.61 billion [7] - The estimate revisions trend for Advantage Solutions is mixed, and future changes in estimates will be closely monitored following the recent earnings report [6][7] Industry Context - The Consumer Products - Discretionary industry, to which Advantage Solutions belongs, is currently ranked in the bottom 44% of over 250 Zacks industries, suggesting potential challenges for stock performance [8]