Company: STGW
Filing Date: 2025-07-31
Form Type: 10-Q
Source: 0000876883-25-000024
Chunk: 105

Company: Stagwell Inc
Filing Date: 2025-07-31
Form: 10-Q
Item: Item 1
Chunk 105
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 new client wins and increased spending in the technology, retail, and automotive sectors, partially offset by lower spending due to budget cuts by large clients in the food and beverage and consumer products sectors. The increase in net acquisitions (divestitures) was primarily driven by the acquisitions of Jetfuel and Create.

Operating Income

Operating Income for the three months ended June 30, 2025 was $46.1 million, compared to $37.1 million for the three months ended June 30, 2024, representing an increase of $9.0 million, primarily attributable to an increase in Revenue and a decrease in Office and general expenses, partially offset by an increase in Cost of services.

The increase in Cost of services was primarily attributable to higher staff costs due to the inclusion of costs from acquired entities, and higher stock-based compensation.

The decrease in Office and general expenses was primarily attributable to a decrease in deferred acquisition consideration expense.

Stock-based compensation increased by $7.4 million, primarily due to an increase in the fair value of profit interest awards.

Deferred acquisition consideration decreased by $6.8 million, primarily attributable to a reduction in the fair value of the deferred acquisition consideration liability associated with certain Brands.

Adjusted EBITDA increased by $9.5 million, primarily driven by an increase in Revenue, partially offset by an increase in expenses, as discussed above.

Brand Performance Network

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

Three Months Ended June 30,20252024Change(dollars in thousands)$%Revenue$170,099 $177,245 $(7,146)(4.0)%Operating ExpensesCost of services101,720 109,418 (7,698)(7.0)%Office and general expenses60,132 56,106 4,026 7.2 %Depreciation and amortization8,145 11,715 (3,570)(30.5)%$169,997 $177,239 $(7,242)(4.1)%Operating Income$102 $6 $96 NM

48

Three Months Ended June 30,20252024Change(dollars in thousands)$%Net Revenue$154,868 $157,108 $(2,240)(1.4)%Billable costs 15,231 20,137 (