Open the filing on EDGARFOR IMMEDIATE ISSUE
STAGWELL INC. (NASDAQ: STGW) REPORTS RESULTS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2026
Q3 YoY Revenue Growth of 10% to $816 million; Q3 YoY Net Revenue Growth of 8% to $664 million
Q3 YoY Digital Transformation Organic Net Revenue Growth of 23%; Q3 YoY The Marketing Cloud Organic Net Revenue Growth of 108%; Enterprise Technology Products Contracted to Date of $59 million More Than Double Initial 2026 Goal
Q3 EPS of $0.07; Q3 Adjusted EPS Growth YoY of 42% to $0.34
Q3 Net Income Attributable to Stagwell Inc. Common Shareholders of $18 million; Q3 Adjusted EBITDA Growth YoY of 25% to $145 million
Year-to-Date Net Cash Provided by Operating Activities Increased 396% YoY to $152 million; Year-to-Date Free Cash Flow Increased 227% YoY to $52 million
Net New Business of $168 million in Q3; LTM Net New Business of $586 million
Largest Multi-Agency Deal in Stagwell History With ServiceNow; Secured First Major Federal Government Win; Expanded Partnership with Palantir
Raise Full-Year Adjusted EBITDA Guidance to $490 million to $540 million; Raise Full-Year Adjusted EPS Guidance to $1.07 to $1.21
New York, NY, October 29, 2026 (NASDAQ: STGW) - Stagwell Inc. (“Stagwell”) today announced financial results for the three and nine months ended September 30, 2026.
THIRD QUARTER RESULTS:
- Q3 Revenue of $816 million, an increase of 10% versus the prior year period; YTD Revenue of $2,306 million, an increase of 10%;
- Q3 Revenue increased 11% organically versus the prior year period; YTD Revenue increased 9% organically;
- Q3 Net Revenue of $664 million, an increase of 8% versus the prior year period; YTD Net Revenue of $1,880 million, an increase of 6%;
- Q3 Net Revenue increased 7% organically versus the prior year period; YTD Net Revenue increased 5% organically;
- Q3 Digital Transformation Net Revenue of $119 million, an organic increase of 23% versus the prior year period;
- Two-Year Net Revenue Growth Stack for Digital Transformation of 38%, Two-Year Organic Net Revenue Growth Stack for Digital Transformation of 30%;
- Q3 The Marketing Cloud Net Revenue of $56 million, an organic increase of 108% versus the prior year period;
- YTD enterprise technology products contracted to date of $59 million, more than double initial FY26 target;
- Q3 Net Income attributable to Stagwell Inc. Common Shareholders of $18 million versus $25 million in the prior year period; YTD Net Loss attributable to Stagwell Inc. Common Shareholders of $3 million versus income of $16 million in the prior year period;
- Q3 Adjusted EBITDA of $145 million, an increase of 25% versus the prior year period; YTD Adjusted EBITDA of $343 million an increase of 17%;
- Q3 Adjusted EBITDA Margin of 22% on net revenue; YTD Adjusted EBITDA Margin of 18%;
- Q3 Earnings Per Share attributable to Stagwell Inc. Common Shareholders of $0.07 versus $0.09; YTD Loss Per Share attributable to Stagwell Inc. Common Shareholders of $(0.01) versus Earnings Per Share of $0.04 in the prior year period;
- Q3 Adjusted Earnings Per Share attributable to Stagwell Inc. Common Shareholders of $0.34 versus $0.24; YTD Adjusted Earnings Per Share attributable to Stagwell Inc. Common Shareholders of $0.77 versus $0.54 in the prior year period;
- YTD Net Cash provided by Operating Activities of $152 million versus $31 million in the prior year period;
- Net new business of $168 million in the third quarter, last twelve-month net new business of $586 million
See “Non-GAAP Financial Measures” below for explanations and reconciliations of the Company’s non-GAAP financial measures.
“This is the biggest quarter in Stagwell’s history. It shows we are on track to become number one in marketing transformation,” said Mark Penn, Chairman and CEO of Stagwell. “Software products, like our agentic Stagwell Machines, and the Digital Transformation segment are driving our business as we pivot from primarily marketing services to AI-powered marketing transformation. We have more than doubled our initial Enterprise Technology Bookings goal for the year, saw 23% organic net revenue growth in Digital Transformation, and 108% organic growth in The Marketing Cloud."
Ryan Greene, Chief Financial Officer, added: “The third quarter was Stagwell’s largest ever on virtually every metric. Organic net revenue for the company grew more than 7% year-over-year to $664 million, while our adjusted EBITDA grew 25% to $145 million, and our adjusted EPS grew 42% to $0.34. These improved earnings also contributed to a more than 400% increase in operating cash flow year to date. Net leverage now stands at 2.7x, a 0.7x improvement year-over-year, and our lowest ever third quarter ratio. Results through the first three quarters give us the confidence to raise our adjusted EBITDA and adjusted EPS guidance today.”
Financial Outlook
2026 financial guidance is updated as follows:
- Raise Adjusted EBITDA to $490 million to $540 million
- Raise Adjusted EPS to $1.07 - $1.21
- Reiterate Total Net Revenue growth of 8% to 12%
- Reiterate Free Cash Flow Conversion of 50% to 60%
- Guidance includes anticipated impact from acquisitions or dispositions.
* The Company has excluded a quantitative reconciliation with respect to the Company’s 2026 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, October 29, 2026, at 8:30 a.m. (ET) to discuss results for Stagwell Inc. for the three and nine months ended September 30, 2026. The video webcast will be accessible at https://edge.media-server.com/mmc/p/qudoyxam/. 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 global challenger network transforming marketing through AI. 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 40+ countries are unified under a single purpose: to drive effectiveness and improve business results for our clients. Join us at www.stagwellglobal.com.
For Press:
Lena Petersen
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 (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 the 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 the 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: is defined as Net income (loss) attributable to Stagwell Inc. common shareholders excluding non-operating income or expense, income tax expense or benefit, equity in income or loss of non-consolidated entities and net income or loss attributable to noncontrolling and redeemable noncontrolling interest holders to achieve Operating income (loss), plus depreciation and amortization, stock-based compensation, deferred acquisition consideration adjustments, impairment and other losses, and other items. Other items primarily include restructuring, certain system implementation costs, working capital administrative fees, acquisition-related expenses, and other non-recurring income and expenses. Adjusted EBITDA for our reportable segments is reconciled to Operating income (loss), as Net income (loss) is not relevant for a reportable segment financial metric.
(4) Adjusted Diluted EPS: is defined as Adjusted Net Income (loss) attributable to Stagwell Inc. common and Class C shareholders, divided by the diluted weighted average shares outstanding. Adjusted Net Income represents net income (loss) attributable to Stagwell Inc. common and Class C shareholders, excluding amortization, impairment and other losses, stock-based compensation, deferred acquisition consideration adjustments, discrete tax items, and other items (as defined above), allocated between the two share classes based on their respective income allocation percentages using a normalized effective tax rate. The diluted weighted average shares outstanding includes the diluted weighted average common shares outstanding plus Class C common stock, par value $0.00001 per share (the “Class C Common Stock”) as if converted to shares of Class A Common Stock if not included because they were anti-dilutive.
(5) Free Cash Flow: defined as consolidated net cash flow from operations less cash outflow from capital expenditures and capitalized software, excluding material nonrecurring capital purchases. 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.
Forward-looking statements notice
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,” “depend,” “develop, “drive,” “enhance,” “estimate,” “evaluate,” “expand,” “expect,” “focus,” “forecast,” “future,” “grow,” “guidance,” “illustrative,” “improve,” “intend,” “likely,” “maintain,” “may,” “objective,” “ongoing,” “opportunity,” “optimize,” “outlook,” “plan,” “position,” “possible,” “potential,” “probable,” “project,” “realize,” “remain,” “scenario,” “seek,” “should,” “strategy,” “sufficient,” “support,” “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 notice
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 tariffs 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 address inflation, including changes in interest rates;
- 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, and its ability to realize anticipated efficiencies and other benefits from its investments in artificial intelligence and automation technologies, and changes in client demand for artificial intelligence-related services;
- 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, such as errors requiring out-of-period adjustments;
- 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 in Iran and the Middle East, and between Russia and Ukraine), terrorist activities, natural disasters, public health events, and tariff and trade policies, including the resulting effects on client marketing spend in affected regions;
- stock price volatility; and
- foreign currency fluctuations.
Investors should carefully consider these risks and the additional risk factors described in more detail in our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Form 10-K”), filed with the Securities and Exchange Commission (the “SEC”) on March 13, 2026, and accessible on the SEC’s website at www.sec.gov, under the caption “Risk Factors,” in our subsequent Quarterly Reports on Form 10-Q and in the Company’s other SEC filings.
SCHEDULE 1
STAGWELL INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
| Three Months Ended September 30, | Nine Months Ended September 30, |
|---|
| 2026 | 2025 | 2026 | 2025 |
|---|
| Revenue | $816,027 | | $742,998 | | $2,306,477 | | $2,101,556 | |
| Operating expenses | | | | |
| Cost of services | 511,698 | | 470,937 | | 1,488,293 | | 1,342,240 | |
| Office and general expenses | 206,942 | | 166,422 | | 611,323 | | 528,845 | |
| Depreciation and amortization | 48,300 | | 44,260 | | 136,395 | | 127,635 | |
| Impairment and other losses | 1,028 | | 466 | | 1,219 | | 466 | |
| 767,968 | | 682,085 | | 2,237,230 | | 1,999,186 | |
| Operating Income | 48,059 | | 60,913 | | 69,247 | | 102,370 | |
| Other income (expenses): | | | | |
| Interest expense, net | (23,993) | | (25,196) | | (69,587) | | (72,007) | |
| Foreign exchange, net | 2,244 | | (366) | | (172) | | (484) | |
| Other, net | 2,526 | | (2,032) | | 3,394 | | (2,143) | |
| (19,223) | | (27,594) | | (66,365) | | (74,634) | |
| Income before income taxes and equity in earnings of non-consolidated affiliates | 28,836 | | 33,319 | | 2,882 | | 27,736 | |
| Income tax expense | 10,882 | | 9,555 | | 7,646 | | 13,950 | |
| Income (loss) before equity in earnings of non-consolidated affiliates | 17,954 | | 23,764 | | (4,764) | | 13,786 | |
| Equity in income (loss) of non-consolidated affiliates | 442 | | (1) | | 512 | | 18 | |
| Net income (loss) | 18,396 | | 23,763 | | (4,252) | | 13,804 | |
| Net (income) loss attributable to noncontrolling and redeemable noncontrolling interests | (277) | | 856 | | 1,282 | | 2,637 | |
| Net income (loss) attributable to Stagwell Inc. common shareholders | $18,119 | | $24,619 | | $(2,970) | | $16,441 | |
| Earnings (loss) per common share: | | | | |
| Basic | $0.07 | | $0.10 | | $(0.01) | | $0.08 | |
| Diluted | $0.07 | | $0.09 | | $(0.01) | | $0.04 | |
| Weighted average number of common shares outstanding: | | | | |
| Basic | 244,666 | | 255,952 | | 247,131 | | 210,139 | |
| Diluted | 250,989 | | 259,583 | | 247,131 | | 266,773 | |
SCHEDULE 2
UNAUDITED COMPONENTS OF NET REVENUE CHANGE
| | Net Revenue - Components of Change | | | Change |
|---|
| Three Months Ended September 30, 2025 | Foreign Currency | Net Acquisitions (Divestitures) | Organic | Total Change | Three Months Ended September 30, 2026 | Organic | Total |
|---|
| Marketing Services | $239,961 | $(176) | | $(3,996) | $(18,108) | $(22,280) | $217,681 | (7.5)% | (9.3)% |
| Digital Transformation | 96,111 | | (233) | 599 | 22,182 | 22,548 | 118,659 | 23.1% | 23.5% |
| Media & Commerce | 162,542 | | (432) | - | (3,366) | (3,798) | 158,744 | (2.1)% | (2.3)% |
| Communications | 96,631 | 72 | | 7,657 | 19,324 | 27,053 | 123,684 | 20.0% | 28.0% |
| The Marketing Cloud | 26,571 | 304 | | - | 28,808 | 29,112 | 55,683 | 108.4% | 109.6% |
| Corporate, eliminations and other | (7,294) | 12 | | - | (3,152) | (3,140) | (10,434) | 43.2% | 43.0% |
| $614,522 | $(453) | | $4,260 | $45,688 | $49,495 | $664,017 | 7.4% | 8.1% |
See Non-GAAP Financial Measures section above for the definition of Organic Net Revenue.
SCHEDULE 3
STAGWELL INC. AND SUBSIDIARIES
UNAUDITED COMPONENTS OF NET REVENUE CHANGE
| | Net Revenue - Components of Change | | | Change |
|---|
| Nine Months Ended September 30, 2025 | Foreign Currency | Net Acquisitions (Divestitures) | Organic | Total Change | Nine Months Ended September 30, 2026 | Organic | Total |
|---|
| Marketing Services | $692,760 | $3,086 | | $(7,740) | $(15,436) | $(20,090) | $672,670 | (2.2)% | (2.9)% |
| Digital Transformation | 277,091 | | (617) | 3,826 | 45,734 | 48,943 | 326,034 | 16.5% | 17.7% |
| Media & Commerce | 459,911 | | 1,855 | 4,185 | (191) | 5,849 | 465,760 | - % | 1.3% |
| Communications | 285,447 | 1,041 | | 10,271 | 36,114 | 47,426 | 332,873 | 12.7% | 16.6% |
| The Marketing Cloud | 77,364 | 2,863 | | - | 30,576 | 33,439 | 110,803 | 39.5% | 43.2% |
| Corporate, eliminations and other | (15,735) | (8) | | - | (12,173) | (12,181) | (27,916) | 77.4% | 77.4% |
| $1,776,838 | $8,220 | | $10,542 | $84,624 | $103,386 | $1,880,224 | 4.8% | 5.8% |
See Non-GAAP Financial Measures section above for the definition of Organic Net Revenue.
SCHEDULE 4
UNAUDITED SEGMENT OPERATING RESULTS
For the Three Months Ended September 30, 2026
| Marketing Services | Digital Transformation | Media & Commerce | Communications | The Marketing Cloud | Corporate, Elimination and Other | Total |
|---|
| Revenue | $255,445 | $127,176 | $176,857 | $210,913 | $55,825 | $(10,189) | $816,027 |
| Billable costs | 37,764 | 8,517 | 18,113 | 87,229 | 142 | 245 | 152,010 |
| Net revenue | 217,681 | 118,659 | 158,744 | 123,684 | 55,683 | (10,434) | 664,017 |
| Staff costs | 126,795 | 73,620 | 95,403 | 59,939 | 16,572 | 13,288 | 385,617 |
| Administrative costs | 24,677 | 6,830 | 26,650 | 13,432 | 5,291 | 5,878 | 82,758 |
| Unbillable and other costs, net | 24,254 | 71 | 16,917 | 2,455 | 9,165 | (2,056) | 50,806 |
| Adjusted EBITDA | 41,955 | 38,138 | 19,774 | 47,858 | 24,655 | (27,544) | 144,836 |
| Stock-based compensation | 11,717 | 3,675 | 1,230 | 4,221 | 400 | 7,677 | 28,920 |
| Depreciation and amortization | 11,841 | 6,256 | 8,601 | 6,925 | 5,995 | 8,682 | 48,300 |
| Deferred acquisition consideration | - | 3,433 | 1,216 | 3,013 | 13 | - | 7,675 |
| Impairment and other losses | - | - | - | - | 1,028 | - | 1,028 |
| Other items, net | 3,161 | 318 | 3,712 | 701 | 986 | 1,976 | 10,854 |
| Operating income (loss) | $15,236 | $24,456 | $5,015 | $32,998 | $16,233 | $(45,879) | $48,059 |
See Non-GAAP Financial Measures section above for the definition of Adjusted EBITDA and Other items, net.
SCHEDULE 5
STAGWELL INC. AND SUBSIDIARIES
UNAUDITED SEGMENT OPERATING RESULTS
For the Nine Months Ended September 30, 2026
| Marketing Services | Digital Transformation | Media & Commerce | Communications | The Marketing Cloud | Corporate, eliminations and other | Total |
|---|
| Revenue | $786,650 | $349,756 | $534,561 | $552,767 | $110,963 | $(28,220) | $2,306,477 |
| Billable costs | 113,980 | 23,722 | 68,801 | 219,894 | 160 | (304) | 426,253 |
| Net revenue | 672,670 | 326,034 | 465,760 | 332,873 | 110,803 | (27,916) | 1,880,224 |
| Staff costs | 390,338 | 208,901 | 291,338 | 178,086 | 51,460 | 30,062 | 1,150,185 |
| Administrative costs | 74,036 | 20,966 | 74,902 | 40,634 | 18,003 | 10,932 | 239,473 |
| Unbillable and other costs, net | 75,327 | 381 | 45,820 | 6,291 | 23,962 | (4,423) | 147,358 |
| Adjusted EBITDA | 132,969 | 95,786 | 53,700 | 107,862 | 17,378 | (64,487) | 343,208 |
| Stock-based compensation | 24,649 | 8,368 | 2,871 | 9,131 | 906 | 15,810 | 61,735 |
| Depreciation and amortization | 36,749 | 18,011 | 24,319 | 19,972 | 18,945 | 18,399 | 136,395 |
| Deferred acquisition consideration | (1,969) | 13,535 | 9,854 | 4,773 | 573 | - | 26,766 |
| Impairment and other losses | - | - | 191 | - | 1,028 | - | 1,219 |
| Other items, net | 9,085 | 1,938 | 11,692 | 4,205 | 1,686 | 19,240 | 47,846 |
| Operating income (loss) | $64,455 | $53,934 | $4,773 | $69,781 | $(5,760) | $(117,936) | $69,247 |
See Non-GAAP Financial Measures section above for the definition of Adjusted EBITDA and Other items, net.
SCHEDULE 6
STAGWELL INC. AND SUBSIDIARIES
UNAUDITED SEGMENT OPERATING RESULTS
For the Three Months Ended September 30, 2025
| Marketing Services | Digital Transformation | Media & Commerce | Communications | The Marketing Cloud | Corporate, eliminations and other | Total |
|---|
| Revenue | $291,089 | $104,445 | $183,112 | $145,086 | $26,576 | $(7,310) | $742,998 |
| Billable costs | 51,128 | 8,334 | 20,570 | 48,455 | 5 | (16) | 128,476 |
| Net revenue | 239,961 | 96,111 | 162,542 | 96,631 | 26,571 | (7,294) | 614,522 |
| Staff costs | 138,310 | 62,845 | 98,212 | 56,650 | 17,969 | 13,224 | 387,210 |
| Administrative costs | 26,835 | 6,981 | 24,225 | 12,516 | 3,068 | (3,238) | 70,387 |
| Unbillable and other costs, net | 17,187 | 401 | 15,554 | 2,344 | 6,898 | (1,446) | 40,938 |
| Adjusted EBITDA | 57,629 | 25,884 | 24,551 | 25,121 | (1,364) | (15,834) | 115,987 |
| Stock-based compensation | 4,240 | 934 | 1,111 | 1,594 | 200 | 4,567 | 12,646 |
| Depreciation and amortization | 12,820 | 5,932 | 7,524 | 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 | 2,200 | 432 | 4,153 | 1,624 | 1,284 | 1,357 | 11,050 |
| Operating income (loss) | $38,869 | $16,712 | $10,350 | $19,034 | $2,872 | $(26,924) | $60,913 |
See Non-GAAP Financial Measures section above for the definition of Adjusted EBITDA and Other items.
SCHEDULE 7
UNAUDITED SEGMENT OPERATING RESULTS
For the Nine Months Ended September 30, 2025
| Marketing Services | Digital Transformation | Media & Commerce | Communications | The Marketing Cloud | Corporate, Elimination and Other | Total |
|---|
| Revenue | $817,294 | $294,301 | $509,416 | $420,556 | $77,380 | $(17,391) | $2,101,556 |
| Billable costs | 124,534 | 17,210 | 49,505 | 135,109 | 16 | (1,656) | 324,718 |
| Net Revenue | 692,760 | 277,091 | 459,911 | 285,447 | 77,364 | (15,735) | 1,776,838 |
| Staff costs | 401,036 | 186,972 | 291,228 | 172,273 | 52,001 | 33,232 | 1,136,742 |
| Administrative costs | 83,338 | 19,599 | 70,963 | 37,042 | 11,582 | (4,301) | 218,223 |
| Unbillable and other costs, net | 61,801 | 1,178 | 44,486 | 7,103 | 18,399 | (3,665) | 129,302 |
| Adjusted EBITDA | 146,585 | 69,342 | 53,234 | 69,029 | (4,618) | (41,001) | 292,571 |
| Stock-based compensation | 14,832 | 3,081 | 3,302 | 6,760 | 541 | 15,627 | 44,143 |
| Depreciation and amortization | 39,556 | 17,250 | 22,211 | 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 | 3,133 | 1,493 | 11,210 | 3,686 | 2,609 | 5,737 | 27,868 |
| Operating income (loss) | $93,848 | $39,789 | $13,569 | $43,891 | $(14,529) | $(74,198) | $102,370 |
See Non-GAAP Financial Measures section above for the definition of Adjusted EBITDA and Other items, net.
SCHEDULE 8
UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP MEASURE)
For the Three Months Ended September 30, 2026
| GAAP | Adjustments | Non-GAAP |
|---|
| Net income attributable to Stagwell Inc. common shareholders | $18,119 | $67,859 | $85,978 |
| Diluted - Weighted average number of shares outstanding | 250,989 | - | 250,989 |
| Diluted EPS and Adjusted Diluted EPS | $0.07 | | $0.34 |
| Adjustments to Net income |
| Amortization | | $42,884 | |
| Impairment and other losses | | 1,028 | |
| Stock-based compensation | | 28,920 | |
| Deferred acquisition consideration | | 7,675 | |
| Other items, net | | 7,409 | |
| | 87,916 | |
| Adjustment to GAAP income tax expense | | (20,057) | |
| | $67,859 | |
See Non-GAAP Financial Measures section above for the definition of Adjusted Diluted EPS.
Other items, net, primarily includes restructuring, certain system implementation costs, working capital administrative fees, acquisition-related expense, and other non-recurring expenses.
Represents the difference between the income tax expense of $10.9 million at an effective tax rate of 37.7% on a GAAP basis and the income tax expense of $30.9 million at an effective tax rate of 26.5% on a non-GAAP basis. The difference reflects the tax impact of non-GAAP adjustments.
SCHEDULE 9
STAGWELL INC. AND SUBSIDIARIES
UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP MEASURE)
For the Nine Months Ended September 30, 2026
| GAAP | Adjustments | Non-GAAP |
|---|
| Net (loss) income attributable to Stagwell Inc. common shareholders | $(2,970) | $193,633 | $190,663 |
| Diluted - Weighted average number of common shares outstanding | 247,131 | - | 247,131 |
| Diluted EPS and Adjusted Diluted EPS | $(0.01) | | $0.77 |
| Adjustments to Net (loss) income |
| Amortization | | $119,962 | |
| Impairment and other losses | | 1,219 | |
| Stock-based compensation | | 61,735 | |
| Deferred acquisition consideration | | 26,766 | |
| Other items, net | | 44,401 | |
| | 254,083 | |
| Adjustment to GAAP income tax expense | | (60,450) | |
| | $193,633 | |
See Non-GAAP Financial Measures section above for the definition of Adjusted Diluted EPS.
Other items, net, primarily includes restructuring, certain system implementation costs, working capital administrative fees, acquisition-related expense, and other non-recurring expenses.
Represents the difference between the income tax expense of $7.6 million at an effective tax rate of 265.3% on a GAAP basis and the income tax expense of $68.1 million at an effective tax rate of 26.5% on a non-GAAP basis. The difference reflects the tax impact of non-GAAP adjustments.
SCHEDULE 10
UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP MEASURE)
For the Three Months Ended September 30, 2025
| GAAP | Adjustments | Non-GAAP |
|---|
| Net income attributable to Stagwell Inc. common shareholders | $24,619 | $38,575 | $63,194 |
| Diluted - Weighted average number of common shares outstanding | 259,583 | - | 259,583 |
| Diluted EPS and Adjusted Diluted EPS | $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 | | 13,333 | |
| | 51,804 | |
| Adjustment to GAAP income tax expense | | (13,229) | |
| | 38,575 | |
See Non-GAAP Financial Measures section above for the definition of Adjusted Diluted EPS.
Other items, net, primarily includes restructuring, certain system implementation costs, working capital administrative fees, acquisition-related expense, and other non-recurring expenses.
Represents the difference between the income tax expense of $9.6 million at an effective tax rate of 28.7% on a GAAP basis and the income tax expense of $22.8 million at an effective tax rate of 26.5% on a non-GAAP basis. The difference reflects the tax impact of non-GAAP adjustments.
SCHEDULE 11
STAGWELL INC. AND SUBSIDIARIES
UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP MEASURE)
For the Nine Months Ended September 30, 2025
| GAAP | Adjustments | Non-GAAP |
|---|
| Net income attributable to Stagwell Inc. common shareholders | $16,441 | $134,175 | $150,616 |
| 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 | $134,175 | $143,979 |
| 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 | $0.04 | | $0.54 |
| 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 | | 30,151 | |
| | 172,130 | |
| Adjustment to GAAP income tax expense | | (37,955) | |
| | $134,175 | |
See Non-GAAP Financial Measures section above for the definition of Adjusted Diluted EPS.
Other items, net, primarily includes restructuring, certain system implementation costs, working capital administrative fees, acquisition-related expense, and other non-recurring expenses.
Represents the difference between the income tax expense of $14.0 million at an effective tax rate of 50.3% on a GAAP basis and the income tax expense of $51.9 million at an effective tax rate of 26.5% on a non-GAAP basis. The difference reflects the tax impact of non-GAAP adjustments.
SCHEDULE 12
STAGWELL INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS
| September 30, 2026 | December 31, 2025 |
|---|
| ASSETS | | |
| Current Assets | | |
| Cash and cash equivalents | $132,197 | $104,537 |
| Accounts receivable, net | 772,787 | 735,752 |
| Expenditures billable to clients | 144,015 | 164,694 |
| Other current assets | 174,932 | 157,309 |
| Total Current Assets | 1,223,931 | 1,162,292 |
| Fixed assets, net | 70,083 | 73,081 |
| Right-of-use assets - operating leases | 189,243 | 213,576 |
| Goodwill | 1,598,491 | 1,595,238 |
| Other intangible assets, net | 795,689 | 834,248 |
| Deferred tax assets | 280,193 | 281,057 |
| Other assets | 53,812 | 55,055 |
| Total Assets | $4,211,442 | $4,214,547 |
| LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS ("RNCI"), AND SHAREHOLDERS’ EQUITY | | |
| Current Liabilities | | |
| Accounts payable | $489,376 | $548,320 |
| Accrued media | 228,612 | 239,490 |
| Accruals and other liabilities | 330,142 | 291,554 |
| Advance billings | 365,529 | 329,815 |
| Current portion of lease liabilities - operating leases | 55,073 | 55,386 |
| Current portion of deferred acquisition consideration | 42,871 | 15,446 |
| Total Current Liabilities | 1,511,603 | 1,480,011 |
| Long-term debt | 1,414,574 | 1,326,013 |
| Long-term portion of deferred acquisition consideration | 21,494 | 24,598 |
| Long-term lease liabilities - operating leases | 195,482 | 224,397 |
| Deferred tax liabilities | 53,899 | 54,726 |
| Long-term tax receivable agreement liability | 252,390 | 252,390 |
| Other liabilities | 30,456 | 51,077 |
| Total Liabilities | 3,479,898 | 3,413,212 |
| Redeemable Noncontrolling Interests | 21,247 | 24,968 |
| Commitments, contingencies and guarantees | | |
| Shareholders' Equity | | |
| Common shares - Class A | 245 | 252 |
| Paid-in capital | 697,402 | 744,463 |
| Retained earnings | 31,203 | 32,930 |
| Accumulated other comprehensive loss | (34,787) | (19,252) |
| Stagwell Inc. Shareholders' Equity | 694,063 | 758,393 |
| Noncontrolling interests | 16,234 | 17,974 |
| Total Shareholders' Equity | 710,297 | 776,367 |
| Total liabilities, RNCI, and shareholders’ equity | $4,211,442 | $4,214,547 |
SCHEDULE 13
STAGWELL INC. AND SUBSIDIARIES
UNAUDITED SUMMARY CASH FLOW DATA
| Nine Months Ended September 30, |
|---|
| 2026 | 2025 |
|---|
| Cash flows from operating activities: | | |
| Net (loss) income | $(4,252) | | $13,804 | |
| Adjustments to reconcile net loss to cash provided by operating activities: | | |
| Stock-based compensation | 61,735 | | 44,143 | |
| Depreciation and amortization | 136,395 | | 127,635 | |
| Amortization of right-of-use lease assets and lease liability interest | 47,471 | | 51,208 | |
| Impairment and other (gains) losses | (2,226) | | (3,063) | |
| Deferred income taxes | 476 | | 3,216 | |
| Adjustment to deferred acquisition consideration | 26,766 | | (9,911) | |
| Other, net | 2,280 | | 1,319 | |
| Changes in working capital: | | |
| Accounts receivable | (51,575) | | (3,477) | |
| Expenditures billable to clients | 20,723 | | 26,266 | |
| Other current assets | (22,408) | | (53,377) | |
| Accounts payable | (50,059) | | (57,306) | |
| Accrued expenses and other liabilities | 5,297 | | (117,118) | |
| Advance billings | 35,360 | | 67,964 | |
| Current portion of lease liabilities - operating leases | (52,254) | | (59,414) | |
| Deferred acquisition related payments | (1,450) | | (1,176) | |
| Net cash provided by operating activities | 152,279 | | 30,713 | |
| Cash flows from investing activities: | | |
| Capitalized software | (75,855) | | (45,315) | |
| Capital expenditures | (27,405) | | (26,338) | |
| Acquisitions, net of cash acquired | (6,347) | | (6,179) | |
| Other | (4,303) | | (2,927) | |
| Net cash used in investing activities | (113,910) | | (80,759) | |
| Cash flows from financing activities: | | |
| Repayment of borrowings under revolving credit facility | (1,533,426) | | (1,412,000) | |
| Proceeds from borrowings under revolving credit facility | 1,619,780 | | 1,586,326 | |
| Shares repurchased and cancelled | (90,716) | | (105,183) | |
| Distributions to noncontrolling interests and RNCI | (3,903) | | (5,018) | |
| Payment of deferred consideration | (337) | | (16,103) | |
| Purchase of noncontrolling interest | (450) | | - | |
| Tax Receivables Agreement payment | (2,554) | | - | |
| Debt financing and other costs | - | | (3,795) | |
| Net cash (used in) provided by financing activities | (11,606) | | 44,227 | |
| Effect of exchange rate changes on cash and cash equivalents | 897 | | 6,718 | |
| Net increase in cash and cash equivalents | 27,660 | | 899 | |
| Cash and cash equivalents at beginning of period | 104,537 | | 131,339 | |
| Cash and cash equivalents at end of period | $132,197 | | $132,238 | |
Contacts
Ben Allanson
IR@stagwellglobal.com