Company: STGW
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0000876883-25-000034
Chunk: 108

Company: Stagwell Inc
Filing Date: 2025-11-06
Form: 10-Q
Item: Item 1
Chunk 108
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.2%Component % change0.4 %2.2 %6.5 %9.2 %

The increase in organic net revenue was primarily attributable to new client wins and increased spending in the retail and financials sectors, partially offset by lower spending due to budget cuts by large clients in the consumer products sectors. The increase in net acquisitions (divestitures) was primarily driven by the acquisition of Jetfuel.

Operating Income

Operating Income for the three months ended September 30, 2025 was $37.5 million, compared to $21.0 million for the three months ended September 30, 2024, representing an increase of $16.5 million. The increase in Operating Income was primarily attributable to an increase in Net revenue of $20.7 million, partially offset by an increase in Cost of services excluding Billable costs. Cost of services increased $12.2 million. Excluding the decline in Billable costs of $8.8 million, Cost of services increased $3.4 million, primarily attributable to higher staff costs.

Adjusted EBITDA increased by $13.1 million, primarily driven by an increase in Net revenue, as discussed above.

Digital Transformation

The components of operating results for the three months ended September 30, 2025 compared to the three months ended September 30, 2024 were as follows: 

Three Months Ended September 30,20252024Change(dollars in thousands)$%Revenue$103,710 $88,292 $15,418 17.5 %Operating ExpensesCost of services62,601 51,862 10,739 20.7 %Office and general expenses18,464 17,339 1,125 6.5 %Depreciation and amortization5,932 5,536 396 7.2 %$86,997 $74,737 $12,260 16.4 %Operating Income$16,713 $13,555 $3,158 23.3 %

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Three Months Ended September 30,20252024Change(dollars in thousands)$%Net Revenue$95,376 $85,270 $10,106 11.9 %Billable costs 8,334 3,022 5,312 175.8 %Revenue103,710 88,292 15,418 17