Stagwell Inc. (NASDAQ:STGW) beat revenue expectations in the second quarter, supported by robust gains in its digital transformation business and market share growth. Following the announcement, shares inched up 0.19% in after-hours trading.
The marketing services company reported adjusted earnings per share of $0.17, in line with analyst forecasts. Revenue came in at $707 million, topping the $699.86 million consensus estimate and reflecting a 5% year-over-year increase. Excluding its advocacy business, net revenue surged 10% from the same period in 2024.
“With 10% ex advocacy net revenue growth, Stagwell is taking share and building momentum across all key metrics this quarter,” said Mark Penn, Chairman and CEO. “In Q2, we posted net new business of $117 million, strong performance at our Digital Transformation businesses, 26% growth among our Top 25 customers, and our first major Government win.”
Despite the top-line beat, Stagwell posted a net loss of $5 million, or $0.02 per share, attributable to common shareholders, compared to a $3 million loss, or $0.03 per share, in the prior-year quarter. Adjusted EBITDA rose 8% to $93 million, while EBITDA excluding advocacy advanced 23% to $80 million.
By segment, the Integrated Agencies Network, Stagwell’s largest business unit, generated $344.9 million in net revenue, up 7.2% year-over-year. The Communications Network segment grew 2.7% to $74.3 million, while Brand Performance Network revenue declined 1.4% to $154.9 million.
Chief Financial Officer Ryan Greene pointed to meaningful progress on financial efficiency: “We have made significant progress on two key initiatives: improving our year-to-date cash flow from operations by $122 million versus the same period last year, and taking actions amounting to $20 million in annualized cost savings.”
The company reaffirmed its full-year 2025 outlook, forecasting approximately 8% total net revenue growth, adjusted EBITDA of $410 million to $460 million, and adjusted EPS between $0.75 and $0.88, consistent with the analyst consensus of $0.80.
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