Strong Experiential Services performance and improved Retailer Services profitability drove Adjusted EBITDA growth
Centralized labor model implementation continues to enhance execution, productivity, and margins
Reaffirming 2026 guidance for Revenues, Adjusted EBITDA and Cash Flow
ST. LOUIS, May 06, 2026 (GLOBE NEWSWIRE) -- Advantage Solutions Inc. (NASDAQ: ADV) (“Advantage,” “Advantage Solutions,” the “Company,” “we,” or “our”), a leading business solutions provider to consumer goods manufacturers and retailers, today reported financial results for the three months ended March 31, 2026.
Revenues for the three months ended March 31, 2026 were $869.6 million compared with $821.8 million, and net loss was $71.8 million compared with a net loss of $56.1 million.
Q1'26 Financial Highlights• Revenues increased 5.8% to $869.6 million and Adjusted EBITDA increased 16.4% to $67.7 million• Experiential Services delivered very strong growth driven by higher event volumes and improved execution, while Branded Services remained under pressure, and Retailer Services showed improved profitability
• Strengthened the balance sheet through debt reduction and the extension of maturities to 2030, improving liquidity and financial flexibility. Ended the quarter with $144 million in cash after $131 million in debt paydown
“Advantage delivered a solid start to the year, highlighted by strong growth in Experiential Services and disciplined execution across the business,” said Advantage CEO Dave Peacock. “While the environment remains uncertain, we are making meaningful progress on our growth and productivity initiatives, including our centralized labor model and technology transformation. We remain focused on driving efficiency, generating strong cash flow, and positioning the Company for sustainable, profitable growth.”
Consolidated Financial Summary(amounts in thousands)Three Months Ended March 31, Change (Reported) 2026 2025 $ %Total Revenues$869,601 $821,792 $47,809 5.8% Total Net Loss$(71,831) $(56,130) $(15,701) (28.0%) Total Adjusted EBITDA$67,747 $58,181 $9,566 16.4% Adjusted EBITDA Margin 7.8% 7.1%Q1'26 Segment Highlights
Branded Services Experiential Services Retailer Services•Continued macro pressure, client insourcing, procurement, and select client losses with stabilization initiatives underway •Strong Q1 results, with events growth of nearly 20% and improved execution rate (94%) year-over-year and sequentially •Revenues and Adjusted EBITDA growth supported by new business wins, pricing, and key client program ramps. •Focused on stabilizing the revenue base with stronger client retention, executive engagement, and targeted growth opportunities •Increasing profitability by advancing the centralized labor model rollout, enhancing training and safety protocols, and shifting mix towards higher margin events •Q1 featured a more moderate impact of the channel mix shift and improvingconversion trends in the retail merchandising business •Enhancing our value proposition through partnerships, data/analytics, and tools like Pulse to deliver measurable ROI • Expecting continued momentum through the year • Solid pipeline momentum with new customers and programs expected to support growth
Cash Flow and Balance Sheet Highlights
(Amounts in Millions)
March 31, 2026Adjusted Unlevered Free Cash Flow / % of Adjusted EBITDA$74.4 / 109.8%Capex$11Gross Debt$1,592Cash and Cash Equivalents$144Net Leverage Ratio(1)4.2x
Fiscal Year 2026 Outlook
(Amounts in Millions)
Net: ~25% of EBITDA Net Interest Expense$160 to $170Capex$50 to $60
2026 revenue outlook excludes reimbursable expenses. 2026 guidance excludes the effect of recently announced divestitures.
(10 minutes before the call)(800) 715-9871 within the United States or +1 (646) 307-1963 outside the United States
Conference ID: 6984882WebcastAvailable at: ADV 1Q26 Earnings WebcastReplay(800) 770-2030 within the United States or +1(609) 800-9909 outside the United States
Playback ID: 6984882#
Investor Contact: [email protected]
Media Contact: [email protected]
NMF = Not Meaningful
(1) Net leverage ratio is defined as Net Debt divided by LTM Adjusted EBITDA.
(2) Net free cash flow is defined as cash flow from operations, less capital expenditures. Net FCF conversion of 25% is excluding incremental debt refinancing costs.
ADV-EARNS
About Advantage Solutions
Advantage Solutions is the leading omnichannel retail solutions agency in North America, uniquely positioned at the intersection of consumer-packaged goods (CPG) brands and retailers. With its data- and technology-powered services, Advantage leverages its unparalleled insights, expertise and scale to help brands and retailers of all sizes generate demand and get products into the hands of consumers, wherever they shop. Whether it’s creating meaningful moments and experiences in-store and online, optimizing assortment and merchandising, or accelerating e-commerce and digital capabilities, Advantage is the trusted partner that keeps commerce and life moving. Advantage has offices throughout North America and strategic investments and owned operations in select international markets. For more information, please visit YourADV.com.
Included with this press release are the Company’s consolidated and condensed financial statements as of and for the three months ended March 31, 2026. These financial statements should be read in conjunction with the information contained in the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (the "SEC") on May 6, 2026.
Forward-Looking Statements
Certain statements in this press release may be considered forward-looking statements within the meaning of the federal securities laws, including statements regarding the expected future performance of Advantage's business and projected financial results. Forward-looking statements generally relate to future events or Advantage’s future financial or operating performance. These forward-looking statements generally are identified by the words “may”, “should”, “expect”, “intend”, “will”, “would”, “could”, “estimate”, “anticipate”, “believe”, “predict”, “confident”, “potential” or “continue”, or the negatives of these terms or variations of them or similar terminology. Such forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks, uncertainties and other factors which could cause actual results to differ materially from those expressed or implied by such forward-looking statements.
These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by Advantage and its management at the time of such statements, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations include, but are not limited to, market-driven wage changes or changes to labor laws or wage or job classification regulations, including minimum wage; developments with respect to retailers that are out of our control; the impact from tariffs; future potential pandemics or health epidemics; Advantage’s ability to continue to generate significant operating cash flow; client procurement strategies and consolidation of Advantage’s clients’ industries creating pressure on the nature and pricing of its services; consumer goods manufacturers and retailers reviewing and changing their sales, retail, marketing and technology programs and relationships; Advantage’s ability to successfully develop and maintain relevant omni-channel services for our clients in an evolving industry and to otherwise adapt to significant technological change; Advantage’s ability to maintain proper and effective internal control over financial reporting in the future; Advantage’s substantial indebtedness and our ability to refinance at favorable rates; and other risks and uncertainties set forth in the section titled “Risk Factors” in the Annual Report on Form 10-K filed by the Company with the SEC on March 3, 2026, and in its other filings made from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and Advantage assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Non-GAAP Financial Measures and Related Information
This press release includes certain financial measures not presented in accordance with generally accepted accounting principles (“GAAP”), including Adjusted EBITDA, Adjusted EBITDA by Segment, Adjusted Unlevered Free Cash Flow and Net Debt. These are not measures of financial performance calculated in accordance with GAAP and may exclude items that are significant in understanding and assessing Advantage’s financial results. Therefore, the measures are in addition to, and not a substitute for or superior to, measures of financial performance prepared in accordance with GAAP, and should not be considered in isolation or as an alternative to net income, cash flows from operations or other measures of profitability, liquidity or performance under GAAP. You should be aware that Advantage’s presentation of these measures may not be comparable to similarly titled measures used by other companies. Reconciliations of historical non-GAAP measures to their most directly comparable GAAP counterparts are included below.
Advantage believes these non-GAAP measures provide useful information to management and investors regarding certain financial and business trends relating to Advantage’s financial condition and results of operations. Advantage believes that the use of Adjusted, Adjusted EBITDA by Segment, Adjusted Unlevered Free Cash Flow, and Net Debt provide an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing Advantage’s financial measures with other similar companies, many of which present similar non-GAAP financial measures to investors. Non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by management about which expense and income are excluded or included in determining these non-GAAP financial measures. Additionally, other companies may calculate non-GAAP measures differently, or may use other measures to calculate their financial performance, and therefore Advantage’s non-GAAP measures may not be directly comparable to similarly titled measures of other companies.
Adjusted EBITDA and Adjusted EBITDA by Segment are supplemental non-GAAP financial measures of our operating performance. Adjusted EBITDA means net loss before (i) interest expense (net), (ii) provision for (benefit from) income taxes, (iii) depreciation, (iv) amortization of intangible assets, (v) impairment of goodwill, (vi) changes in fair value of warrant liability, (vii) stock based compensation expense, (viii) equity-based compensation of Karman Topco L.P., (ix) fair value adjustments of contingent consideration related to acquisitions, (x) acquisition and divestiture related expenses, (xi) (gain) loss on divestitures, (xii) restructuring expenses, (xiii) reorganization expenses, (xiv) litigation expenses (recovery), (xv) COVID-19 benefits received, (xvi) EBITDA for economic interests in investments and (xvii) other adjustments that management believes are helpful in evaluating our operating performance.
Adjusted EBITDA by Segment means, with respect to each segment, operating income (loss) before (i) depreciation, (ii) amortization of intangible assets, (iii) impairment of goodwill, (iv) stock based compensation expense, (v) equity-based compensation of Karman Topco L.P., (vi) fair value adjustments of contingent consideration related to acquisitions, (vii) acquisition and divestiture related expenses, (viii) restructuring expenses, (ix) reorganization expenses, (x) litigation expenses (recovery), (xi) COVID-19 benefits received, (xii) EBITDA for economic interests in investments and (xiii) other adjustments that management believes are helpful in evaluating our operating performance, in each case, attributable to such segment.
Adjusted EBITDA Margin means Adjusted EBITDA divided by total revenues.
Adjusted Unlevered Free Cash Flow represents net cash provided by (used in) operating activities less purchase of property and equipment as disclosed in the Statements of Cash Flows further adjusted by (i) cash payments for interest, (ii) cash received from interest rate derivatives, (iii) cash paid for income taxes; (iv) cash paid for acquisition and divestiture related expenses, (v) cash paid for restructuring expenses, (vi) cash paid for reorganization expenses, (vii) cash paid for contingent earnout payments included in operating cash flow, (viii) COVID-19 benefits received, (ix) net effect of foreign currency fluctuations on cash, and (x) other adjustments that management believes are helpful in evaluating our operating performance. Adjusted Unlevered Free Cash Flow as a percentage of Adjusted EBITDA means Adjusted Unlevered Free Cash Flow divided by Adjusted EBITDA.
Net Debt represents the sum of current portion of long-term debt and long-term debt, less cash and cash equivalents. With respect to Net Debt, cash and cash equivalents are subtracted from the GAAP measure, total debt, because they could be used to reduce the debt obligations. We present Net Debt because we believe this non-GAAP measure provides useful information to management and investors regarding certain financial and business trends relating to the Company’s financial condition and to evaluate changes to the Company's capital structure and credit quality assessment.
Advantage Solutions Inc.Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended March 31, (in thousands, except share and per share data)2026 2025 Revenues$869,601 $821,792 Cost of revenues (exclusive of depreciation and amortization shown separately below) 761,574 722,754 Selling, general, and administrative expenses 53,309 64,865 Depreciation and amortization 51,570 50,361 Gain on divestiture and income from investments in European joint venture (1,014) (1,567) Total operating expenses 865,439 836,413 Operating income (loss) 4,162 (14,621) Other expenses (income): Interest expense, net 34,798 34,360 Income from unconsolidated investments (2,472) — Other expense, including debt fees 20,352 10 Total other expenses, net 52,678 34,370 Loss before benefit from income taxes (48,516) (48,991) Income tax expense 23,315 7,139 Net loss$(71,831) $(56,130) Basic loss per common share$(5.49) $(4.36) Diluted loss per common share$(5.49) $(4.36) Weighted-average number of common shares: Basic 13,077,003 12,867,338 Diluted 13,077,003 12,867,338
Condensed Consolidated Balance Sheet
(Unaudited)
(in thousands, except share data) March 31,
2026 December 31,
2025 ASSETS Current assets Cash and cash equivalents $143,870 $240,850 Restricted cash 12,142 12,137 Accounts receivable, net of allowance for expected credit losses of $17,505 and $16,771, respectively 572,572 594,999 Prepaid expenses and other current assets 76,169 124,629 Total current assets 804,753 972,615 Property, equipment, and capitalized software, net 121,817 115,858 Goodwill 438,900 438,900 Other intangible assets, net 951,593 993,927 Investments in unconsolidated affiliates 205,336 234,138 Other assets 42,451 37,977 Total assets $2,564,850 $2,793,415 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Current portion of long-term debt $25,865 $13,250 Accounts payable 176,466 162,376 Accrued compensation and benefits 97,101 121,105 Other accrued expenses 87,467 105,449 Deferred revenues 25,141 30,454 Total current liabilities 412,040 432,634 Long-term debt, net of current portion 1,520,790 1,660,611 Deferred income tax liabilities 99,107 90,023 Other long-term liabilities 54,885 56,189 Total liabilities 2,086,822 2,239,457 Commitments and contingencies (Note 10) Equity attributable to stockholders of Advantage Solutions Inc. Common stock, $0.0001 par value, 197,400,000 shares authorized; 13,080,791 and 13,058,852 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively 1 1 Additional paid in capital 3,436,566 3,489,020 Accumulated deficit (2,941,178) (2,869,347)Loans to Karman Topco L.P. (7,834) (7,673)Accumulated other comprehensive loss (8,461) (4,158)Treasury stock, at cost; 43,548 and 515,781 shares as of March 31, 2026 and December 31, 2025, respectively (1,066) (53,885)Total stockholders' equity 478,028 553,958 Total liabilities and stockholders' equity $2,564,850 $2,793,415
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Three Months Ended March 31, (in thousands) 2026 2025 CASH FLOWS FROM OPERATING ACTIVITIES Net loss $(71,831) $(56,130)Adjustments to reconcile net loss to net cash provided by (used in) operating activities Non-cash adjustments on derivatives and non-cash interest income (451) (2,694)Amortization of deferred financing fees 1,297 1,748 Depreciation and amortization 51,570 50,361 Deferred income taxes 9,091 449 Equity-based compensation of Karman Topco L.P. — (1,524)Stock-based compensation 2,000 6,485 Gain on divestiture and income from investments in European joint venture (1,014) (1,567)Income from unconsolidated investments (2,472) — Distribution received from equity method investments 2,684 — Other 1,178 (1,614)Changes in operating assets and liabilities: Accounts receivable, net 21,507 (38,200)Prepaid expenses and other assets 44,070 16,743 Accounts payable 14,404 22,236 Accrued compensation and benefits (23,716) (41,928)Deferred revenues (5,265) 2,521 Other accrued expenses and other liabilities (19,324) 3,487 Net cash provided by (used in) operating activities 23,728 (39,627)CASH FLOWS FROM INVESTING ACTIVITIES Purchase of investments in unconsolidated affiliates (2,000) (3,328)Purchase of property and equipment and development of capitalized software (11,401) (15,104)Proceeds from divestitures 40,919 — Net cash provided by (used in) investing activities 27,518 (18,432)CASH FLOWS FROM FINANCING ACTIVITIES Payment of deferred financing fees for line of credit modification (13,702) — Principal payments on long-term debt (131,319) (3,313)Repurchases of senior secured notes and Term Loan Facility — (18,243)Proceeds from 2020 Employee Stock Purchase Plan 744 993 Payments for taxes related to net share settlement of equity awards (73) (707)Purchase of treasury stock (2,306) (869)Net cash used in financing activities (146,656) (22,139)Net effect of foreign currency changes on cash, cash equivalents and restricted cash (1,565) (3,685)Net change in cash, cash equivalents and restricted cash (96,975) (83,883)Cash, cash equivalents and restricted cash, beginning of period 252,987 220,751 Cash, cash equivalents and restricted cash, end of period $156,012 $136,868
Reconciliation of Net Loss to Adjusted EBITDA
(Unaudited)
Three Months Ended March 31, (in thousands)2026 2025 Net loss$(71,831) $(56,130) Add: Interest expense, net 34,798 34,360 Income tax expense 23,315 7,139 Depreciation and amortization 51,570 50,361 Gain on divestiture from investments in European joint venture (1,014) — Other expense, including debt fees 20,352 10 Stock-based compensation expense (a) 2,000 6,485 Equity-based compensation of Karman Topco L.P. (b) — (1,524) Divestiture related expenses (c) 237 423 Restructuring expenses (d) 2,246 931 Reorganization expenses (e) 5,461 12,240 Litigation expenses (f) 362 831 EBITDA for economic interests in investments (g) 251 3,055 Adjusted EBITDA$67,747 $58,181
Reconciliation of Operating (loss) Income to Adjusted EBITDA by Segment
(Unaudited)
Branded Services segmentThree Months Ended March 31, (in thousands)2026 2025 Operating loss$(16,061) $(15,322) Add: Depreciation and amortization 31,322 31,462 Gain on divestiture from investments in European joint venture (1,014) — Stock-based compensation expense (a) 512 2,172 Equity-based compensation of Karman Topco L.P. (b) — (95) Divestiture related expenses (c) 237 378 Restructuring expenses (d) 1,390 358 Reorganization expenses (e) 1,674 5,455 Litigation expenses (f) 99 482 EBITDA for economic interests in investments (g) 2,723 3,055 Branded Services segment Adjusted EBITDA$20,882 $27,945
Net Debt and Adjusted Unlevered Free Cash Flow Reconciliation
(Unaudited)
(amounts in thousands) March 31, 2026 Current portion of long-term debt $25,865 Long-term debt, net of current portion 1,565,702 Total debt 1,591,567 Less: Cash and cash equivalents 143,870 Total Net Debt $1,447,697 LTM Adjusted EBITDA $341,373 Net Debt / LTM Adjusted EBITDA ratio 4.2x
March 31, 2026 Net cash provided by operating activities $23,728 Less: Purchase of property and equipment and development of capitalized software (11,401)Add: Cash payments for interest 53,175 Cash payments for income taxes 5,494 Cash paid for divestiture related expenses (i) 237 Cash paid for reorganization expenses (j) 4,687 Net effect of foreign currency fluctuations on cash (1,565)Adjusted Unlevered Free Cash Flow $74,355 Numerator - Adjusted Unlevered Free Cash Flow $74,355 Denominator - Adjusted EBITDA $67,747 Adjusted Unlevered Free Cash Flow as a percentage of Adjusted EBITDA 109.8%
March 31, 2026(in thousands) Net loss $(243,436)Add: Interest expense, net 139,374 Provision for income taxes (21,408)Depreciation and amortization 203,467 Impairment of goodwill and indefinite-lived asset 203,685 Gain on divestitures (28,997)Other expense, including debt fees 20,259 Stock-based compensation expense (a) 22,430 Divestiture related expenses (c) 2,051 Restructuring expenses (d) 2,246 Reorganization expenses (e) 56,160 Litigation recoveries (f) (20,056)Costs associated with COVID-19, net of benefits received (h) (5,723)EBITDA for economic interests in investments (g) 11,321 LTM Adjusted EBITDA $341,373
________________________
(a)Represents non-cash compensation expense related to performance stock units, restricted stock units, and stock options under the 2020 Advantage Solutions Incentive Award Plan and the Advantage Solutions 2020 Employee Stock Purchase Plan.(b)Represents expenses related to equity-based compensation expense associated with grants of Common Series D Units of Karman Topco L.P. made to one of the Company's private equity sponsors.(c)Represents fees and costs associated with activities related to our divestitures and related reorganization activities, including professional fees, due diligence, and integration activities.(d)Restructuring charges including programs designed to integrate and reduce costs intended to further improve efficiencies in operational activities and align cost structures consistent with revenue levels associated with business changes.(e)Represents fees and costs associated with various internal reorganization and transformational activities, including professional fees, lease and other contract exit costs, severance, and nonrecurring compensation costs.(f)Represents legal settlements, net of reserves and expenses, that are unusual or infrequent costs associated with our operating activities.(g)Represents adjustments to reflect the Company’s proportional share of Adjusted EBITDA related to its equity method investments. For these investments, the adjustment reflects the Company’s proportional share of Adjusted EBITDA rather than reported earnings, consistent with how management evaluates operating performance.(h)Represents (i) costs related to implementation of strategies for workplace safety in response to COVID-19, including employee-relief fund, additional sick pay for front-line teammates, medical benefit payments for furloughed teammates, and personal protective equipment; and (ii) benefits received from government grants for COVID-19 relief.(i)Represents cash paid for fees and costs associated with activities related to our divestitures and reorganization activities including professional fees, due diligence, and integration activities.(j)Represents cash paid for fees and costs associated with various reorganization activities, including professional fees, lease exit costs, severance, and nonrecurring compensation costs.