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0000876883false00008768832025-05-082025-05-08

 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM 8-K
 
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of Earliest Event Reported) — May 8, 2025
 
Stagwell Inc.  
(Exact Name of Registrant as Specified in its Charter)
 
Delaware 001-13718 86-1390679
(Jurisdiction of Incorporation) (Commission File Number) (IRS Employer Identification No.)
 
One World Trade Center, Floor 65, New York, NY 10007
(Address of principal executive offices and zip code)
 
(646) 429-1800
(Registrant’s Telephone Number)
 
 
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading symbol(s) Name of each exchange on which registered
Class A Common Stock, $0.001 par value
STGW NASDAQ

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company     ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.                              ☐

 
 



   
Item 2.02 Results of Operations and Financial Condition

On May 8, 2025, Stagwell Inc. (the “Company”) issued an earnings release reporting its financial results for the three months ended March 31, 2025. A copy of this earnings release is attached as Exhibit 99.1 hereto. Following the issuance of this earnings release, the Company will host an earnings call in which its financial results for the three months ended March 31, 2025 will be discussed. The investor presentation to be used for the call is attached as Exhibit 99.2 hereto.

The Company has posted the materials attached as Exhibit 99.1, and 99.2 on its website (www.stagwellglobal.com). The information found on, or otherwise accessible through, the Company’s website is not incorporated into, and does not form a part of, this Current Report on Form 8-K.
         
The foregoing information (including the exhibits hereto) is being furnished under “Item 2.02 - Results of Operations and Financial Condition”. Such information (including the exhibits hereto) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
    
The foregoing information and the exhibits hereto contain forward-looking statements within the meaning of the federal securities laws. These statements are based on present expectations, and are subject to the limitations listed therein and in the Company’s other SEC reports, including that actual events or results may differ materially from those in the forward-looking statements.










































Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.
99.1 Press release dated May 8, 2025, relating to the Company’s results for the three months ended March 31, 2025.

99.2 Investor presentation dated May 8, 2025.

104 Cover Page Interactive Data File (embedded within the Inline XBRL document)





Signatures
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed by the undersigned hereunto duly authorized.
 
Date: February 27, 2025
Stagwell Inc.
By: /s/ Frank Lanuto
Frank Lanuto
Chief Financial Officer
 


        
EX-99.1 2 stgw2025331pr.htm EX-99.1 Document
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FOR IMMEDIATE ISSUE


STAGWELL INC. (NASDAQ: STGW) REPORTS RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2025

Q1 YoY Revenue Decline of 3%, Q1 YoY Net Revenue Growth of 6%
Q1 YoY Net Revenue Growth excluding Advocacy of 9%, Digital Transformation Net Revenue ex. Advocacy Growth of 15%
Q1 Net Loss Attributable to Stagwell Inc. Common Shareholders of $3 million; Q1 Adjusted EBITDA of $81 million; Adjusted EBITDA Margin of 14%
Q1 EPS of $(0.04); Adjusted EPS of $0.12
Net New Business of $130 million in Q1; LTM Net New Business of $446 million
Reiterate Guidance for 2025 of Total Net Revenue Growth of ~8%; Adjusted EBITDA of $410 million to $460 million; Free Cash Flow Conversion in excess of 45%



New York, NY, May 8, 2025 (NASDAQ: STGW) – Stagwell Inc. (“Stagwell”) today announced financial results for the quarter and three months ended March 31, 2025.

FIRST QUARTER RESULTS:

•Q1 Revenue of $652 million, a decrease of 3% versus the prior year period;
•Q1 Revenue ex. Advocacy of $610 million, an increase of 1% versus the prior year period;
•Q1 Net Revenue of $564 million, an increase of 6% versus the prior year period;
•Q1 Net Revenue ex. Advocacy of $535 million, an increase of 9% versus the prior year period;
•Q1 Net Loss attributable to Stagwell Inc. Common Shareholders of $3 million versus $1 million in the prior year period;
•Q1 Adjusted EBITDA of $81 million, a decrease of 11% versus the prior year period;
•Q1 Adjusted EBITDA Margin of 14% on net revenue;
•Q1 Earnings Per Share Attributable to Stagwell Inc. Common Shareholders of $(0.04) versus $(0.01) in the prior year period;
•Q1 Adjusted Earnings Per Share attributable to Stagwell Inc. Common Shareholders of $0.12 versus $0.16 in the prior year period;
•Net new business of $130 million in the first quarter, last twelve-month net new business of $446 million
See “Non-GAAP Financial Measures” below for explanations and reconciliations of the Company’s non-GAAP financial measures.
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Mark Penn, Chairman and CEO of Stagwell, said, “Despite the macro noise from tariffs, Stagwell’s first quarter results were in-line with our expectations, setting us up for a strong year ahead. Q1 is a low point in the political cycle and yet we delivered solid growth in the quarter, led by double-digit increases in our Digital Transformation, Creativity and Stagwell Marketing Cloud capabilities. We hit a record $130M of net new business and, consequently, we remain optimistic about our outlook for the rest of the year.”

Frank Lanuto, Chief Financial Officer, commented: “Stagwell delivered solid first quarter results. We reported 9% total net revenue growth excluding advocacy, while posting $81 million in adjusted EBITDA as we effectively managed costs. Additionally, we have made significant progress in simplifying our capital structure and refinancing our revolving credit facility. Our results and these actions position us well for the year ahead.”


Financial Outlook
2025 financial guidance is reiterated as follows:
•Total Net Revenue growth of approximately 8%
•Adjusted EBITDA of $410 million to $460 million
•Free Cash Flow Conversion in excess of 45%
•Adjusted EPS of $0.75 - $0.88
•Guidance includes anticipated impact from acquisitions or dispositions.
* The Company has excluded a quantitative reconciliation with respect to the Company’s 2025 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, May 8, 2025, at 8:30 a.m. (ET) to discuss results for Stagwell Inc. for the quarter and three months ended March 31, 2025. The video webcast will be accessible at https://bit.ly/436rkSP. 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 challenger network built to transform marketing. 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 45+ countries are unified under a single purpose: to drive effectiveness and improve business results for their clients. Join us at www.stagwellglobal.com.

Contacts
For Investors:
Ben Allanson
IR@stagwellglobal.com

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For Press:
Beth Sidhu
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) Net New Business: Estimate of annualized revenue for new wins less annualized revenue for losses incurred in the period.
(2) Adjusted EBITDA: defined as Net income excluding non-operating income or expense to achieve operating income, plus depreciation and amortization, stock-based compensation, deferred acquisition consideration adjustments, and other items. Other items include restructuring costs, acquisition-related expenses, and non-recurring items.
(3) Adjusted Diluted EPS is defined as (i) Net income (loss) attributable to Stagwell Inc. common shareholders, plus net income attributable to Class C shareholders, excluding amortization expense, impairment and other losses, stock-based compensation, deferred acquisition consideration adjustments, discrete tax items, and other items, divided by (ii) (a) the per weighted average number of common shares outstanding plus (b) the weighted average number of Class C shares outstanding, (if dilutive). Other items includes restructuring costs, acquisition-related expenses, and non-recurring items, and subject to the anti-dilution rules.
(4) Free Cash Flow: defined as Adjusted EBITDA less capital expenditures, change in net working capital, cash taxes, interest, and distributions to minority interests, but excludes contingent M&A payments. 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.
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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,” “build,” “consider,” “continue,” “could,” “develop,” “drive,” “estimate,” “expect,” “focus,” “forecast,” “future,” “guidance,” “intend,” “likely,” “maintain,” “may,” “ongoing,” “opportunity,” “outlook,” “plan,” “possible,” “potential,” “probable,” “project,” “seek,” “should,” “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 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 tariff 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 counter inflation;
•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 and deferred acquisition consideration;
•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;
•adverse tax consequences for the Company, its operations and its stockholders, that may differ from the expectations of the Company, including that future changes in tax laws, potential increases 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”);
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•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;
•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 between Russia and Ukraine and in the Middle East), terrorist activities, natural disasters, public health events and tariff and trade policies;
•stock price volatility; and
•foreign currency fluctuations.
Investors should carefully consider these risk factors, other risk factors described herein, and the additional risk factors outlined in more detail in our 2024 Form 10-K, filed with the Securities and Exchange Commission (the “SEC”) on March 11, 2025, and accessible on the SEC’s website at www.sec.gov, under the caption “Risk Factors,” and in the Company’s other SEC filings.
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SCHEDULE 1
STAGWELL INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands, except per share amounts)
Three Months Ended March 31,
2025 2024
Revenue $ 651,740  $ 670,059 
Operating Expenses
Cost of services 412,087  444,526 
Office and general expenses 179,362  163,343 
Depreciation and amortization 42,006  34,836 
Impairment and other losses —  1,500 
633,455  644,205 
Operating Income 18,285  25,854 
Other income (expenses):
Interest expense, net (23,356) (20,965)
Foreign exchange, net 1,220  (2,258)
Other, net
249  (1,267)
(21,887) (24,490)
Income (loss) before income taxes and equity in earnings of non-consolidated affiliates
(3,602) 1,364 
Income tax expense 1,722  2,585 
Loss before equity in earnings of non-consolidated affiliates (5,324) (1,221)
Equity in income (loss) of non-consolidated affiliates
(1) 508 
Net loss (5,325) (713)
Net (income) loss attributable to noncontrolling and redeemable noncontrolling interests 2,408  (569)
Net loss attributable to Stagwell Inc. common shareholders $ (2,917) $ (1,282)
Loss Per Common Share:
   Basic $ (0.03) $ (0.01)
   Diluted $ (0.04) $ (0.01)
Weighted Average Number of Common Shares Outstanding:
   Basic 112,088  112,633 
   Diluted 263,737  116,405 
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SCHEDULE 3
STAGWELL INC.
UNAUDITED SEGMENT OPERATING RESULTS
(amounts in thousands)

For the Three Months Ended March 31, 2025
Integrated Agencies Network Brand Performance Network Communications Network All Other Corporate Total
Net Revenue $ 325,794  $ 146,858  $ 66,998  $ 24,537  $ —  $ 564,187 
Billable costs 51,560  15,360  20,630  —  87,553 
Revenue 377,354  162,218  87,628  24,540  —  651,740 
Billable costs 51,560  15,360  20,630  —  87,553 
Staff costs 199,882  96,450  44,577  15,455  11,898  368,262 
Administrative costs 31,644  23,407  10,174  8,225  1,659  75,109 
Unbillable and other costs, net 17,099  15,458  490  7,187  —  40,234 
Adjusted EBITDA (1)
77,169  11,543  11,757  (6,330) (13,557) 80,582 
Stock-based compensation 4,145  1,368  693  229  5,108  11,543 
Depreciation and amortization 21,364  7,722  5,175  4,301  3,444  42,006 
Deferred acquisition consideration 5,863  (1,282) 1,213  863  —  6,657 
Other items, net (1)
(2,246) 3,654  128  311  244  2,091 
Operating income (loss) $ 48,043  $ 81  $ 4,548  $ (12,034) $ (22,353) $ 18,285 

(1) See Non-GAAP Financial Measures section above for the definition of Adjusted EBITDA and Other items, net.






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SCHEDULE 4
STAGWELL INC.
UNAUDITED SEGMENT OPERATING RESULTS
(amounts in thousands)

For the Three Months Ended March 31, 2024
Integrated Agencies Network Brand Performance Network Communications Network All Other Corporate Total
Net Revenue $ 292,772  $ 162,562  $ 67,488  $ 9,632  $ —  $ 532,454 
Billable costs 59,947  51,400  26,258  —  —  137,605 
Revenue 352,719  213,962  93,746  9,632  —  670,059 
Billable costs 59,947  51,400  26,258  —  —  137,605 
Staff costs 186,534  98,431  39,264  7,821  10,107  342,157 
Administrative costs 30,602  22,071  8,704  3,209  2,577  67,163 
Unbillable and other costs, net 15,528  14,566  136  2,588  —  32,818 
Adjusted EBITDA (1)
60,108  27,494  19,384  (3,986) (12,684) 90,316 
Stock-based compensation 9,321  2,043  1,049  98  3,605  16,116 
Depreciation and amortization 19,381  7,514  2,894  2,421  2,626  34,836 
Deferred acquisition consideration 2,045  (777) (1,114) —  —  154 
Impairment and other losses 1,500  —  —  —  —  1,500 
Other items, net (1)
5,511  5,019  282  174  870  11,856 
Operating income (loss) $ 22,350  $ 13,695  $ 16,273  $ (6,679) $ (19,785) $ 25,854 

(1) See Non-GAAP Financial Measures section above for the definition of Adjusted EBITDA and Other items, net.






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SCHEDULE 5
STAGWELL INC.
UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP MEASURE)
(amounts in thousands, except per share amounts)

For the Three Months Ended March 31, 2025
GAAP Adjustments Non-GAAP
Net income (loss) attributable to Stagwell Inc. common shareholders $ (2,917) $ 18,439  $ 15,522 
Net income (loss) attributable to Class C shareholders (6,637) 24,513  17,876 
Net income (loss) attributable to Stagwell Inc. and Class C shareholders and adjusted net income
$ (9,554) $ 42,952  $ 33,398 
Weighted average number of common shares outstanding 112,088  9,462  121,550 
Weighted average number of shares of Class C Common Stock outstanding 151,649  —  151,649 
Weighted average number of shares outstanding 263,737  9,462  273,199 
Diluted EPS and Adjusted Diluted EPS (1)
$ (0.04) $ 0.12 
Adjustments to Net Income (loss)
Amortization $ 32,981 
Stock-based compensation 11,543 
Deferred acquisition consideration 6,657 
Other items, net 2,091 
53,272 
Adjusted tax expense (10,320)
$ 42,952 

(1) Adjusted Diluted EPS is defined within the Non-GAAP Financial Measures section of the Executive Summary.



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SCHEDULE 6
STAGWELL INC.
UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP MEASURE)
(amounts in thousands, except per share amounts)

For the Three Months Ended March 31, 2024
GAAP Adjustments Non-GAAP
Net income (loss) attributable to Stagwell Inc. common shareholders $ (1,506) $ 19,480  $ 17,974 
Net income attributable to Class C shareholders —  24,554  24,554 
Net income (loss) attributable to Stagwell Inc. and Class C shareholders and adjusted net income
$ (1,506) $ 44,034  $ 42,528 
Weighted average number of common shares outstanding 116,405  4,534  120,939 
Weighted average number of shares of Class C Common Stock outstanding —  151,649  151,649 
Weighted average number of shares outstanding 116,405  156,183  272,588 
Diluted EPS and Adjusted Diluted EPS (1)
$ (0.01) $ 0.16 
Adjustments to Net income (loss)
Amortization
$ 28,203 
Impairment and other losses 1,500 
Stock-based compensation 16,116 
Deferred acquisition consideration 154 
Other items, net 11,856 
57,829 
Adjusted tax expense (12,748)
45,081 
Net loss attributable to Class C shareholders (1,047)
$ 44,034 
Allocation of adjustments to Net income
Net income attributable to Stagwell Inc. common shareholders $ 19,480 
Net income attributable to Class C shareholders - add-backs 25,601 
Net loss attributable to Class C shareholders (1,047)
24,554 
$ 44,034 

(1) Adjusted Diluted EPS is defined within the Non-GAAP Financial Measures section of the Executive Summary.
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SCHEDULE 7
STAGWELL INC.
UNAUDITED CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
  March 31, 2025 December 31, 2024
 
ASSETS    
Current Assets    
Cash and cash equivalents $ 137,653  $ 131,339 
Accounts receivable, net 772,974  716,415 
Expenditures billable to clients 163,702  173,194 
Other current assets 147,163  114,200 
Total Current Assets 1,221,492  1,135,148 
Fixed assets, net 69,017  72,706 
Right-of-use assets - operating leases 209,720  219,400 
Goodwill 1,562,490  1,554,146 
Other intangible assets, net 822,964  836,783 
Other assets 96,671  90,038 
Total Assets $ 3,982,354  $ 3,908,221 
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS ("RNCI"), AND SHAREHOLDERS’ EQUITY
Current Liabilities
Accounts payable $ 420,779  $ 449,347 
Accrued media 295,964  245,883 
Accruals and other liabilities 219,047  265,356 
Advance billings 311,329  294,609 
Current portion of lease liabilities - operating leases 56,390  60,195 
Current portion of deferred acquisition consideration 37,336  51,906 
Total Current Liabilities 1,340,845  1,367,296 
Long-term debt 1,465,323  1,353,624 
Long-term portion of deferred acquisition consideration 55,941  50,209 
Long-term lease liabilities - operating leases 224,323  245,397 
Deferred tax liabilities, net 47,323  47,239 
Other liabilities 57,850  59,139 
Total Liabilities 3,191,605  3,122,904 
Redeemable Noncontrolling Interests 10,856  8,412 
Commitments, Contingencies and Guarantees
Shareholders' Equity
Common shares - Class A 114  115 
Common shares - Class C
Paid-in capital 343,082  343,647 
Retained earnings 10,504  11,740 
Accumulated other comprehensive loss (19,302) (23,773)
Stagwell Inc. Shareholders' Equity 334,400  331,731 
Noncontrolling interests 445,493  445,174 
Total Shareholders' Equity 779,893  776,905 
Total Liabilities, Redeemable Noncontrolling Interests and Shareholders’ Equity
$ 3,982,354  $ 3,908,221 
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SCHEDULE 8
STAGWELL INC.
UNAUDITED SUMMARY CASH FLOW DATA
(amounts in thousands)
  Three Months Ended March 31,
2025 2024
Cash flows from operating activities:
Net loss $ (5,325) $ (713)
Adjustments to reconcile net income to cash used in operating activities:
Stock-based compensation 11,543  16,116 
Depreciation and amortization 42,006  34,836 
Amortization of right-of-use lease assets and lease liability interest
17,118  20,912 
Impairment and other (gains) losses (3,529) 1,500 
Deferred income taxes (747) (655)
Adjustment to deferred acquisition consideration 6,657  154 
Other, net (2,060) 292 
Changes in working capital:
Accounts receivable (44,701) (42,976)
Expenditures billable to clients 11,095  6,681 
Other assets (32,778) (19,584)
Accounts payable (35,287) 22,206 
Accrued expenses and other liabilities (19,075) (63,856)
Advance billings 15,628  (6,124)
Current portion of lease liabilities - operating leases (20,558) (21,660)
Deferred acquisition related payments —  (250)
Net cash used in operating activities
(60,013) (53,121)
Cash flows from investing activities:
Capitalized software (11,966) (8,794)
Capital expenditures (3,912) (5,439)
Acquisitions, net of cash acquired (1,090) (11,673)
Other (3,391) (218)
Net cash used in investing activities
(20,359) (26,124)
Cash flows from financing activities:
Repayment of borrowings under revolving credit facility (432,000) (417,000)
Proceeds from borrowings under revolving credit facility 543,000  540,000 
Shares repurchased and cancelled (11,068) (29,698)
Distributions to noncontrolling interests (581) (559)
Payment of deferred consideration (16,103) (1,657)
Net cash provided by financing activities
83,248  91,086 
Effect of exchange rate changes on cash and cash equivalents 3,438  (1,754)
Net increase in cash and cash equivalents 6,314  10,087 
Cash and cash equivalents at beginning of period 131,339  119,737 
Cash and cash equivalents at end of period $ 137,653  $ 129,824 

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EX-99.2 3 a1q25earningspresentatio.htm EX-99.2 a1q25earningspresentatio
First Quarter 2025 EARNINGS PRESENTATION May 8 | 2025


 
This document contains forward-looking statements within the meaning of Section 27A of the Securities Ac t of 1933, as amended (the “Securities Ac t”) , and Section 21E of the Securities Exchange Ac t of 1934, as amended (the “Exchange Ac t”). 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 historic al 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,” “build,” “consider,” “continue,” “could,” “develop,” “drive,” “estimate,” “expect,” “focus,” “forecast,” “future,” “guidance,” “intend,” “likely,” “maintain,” “may,” “ongoing,” “opportunity,” “outlook,” “plan,” “possible,” “potential,” “probable,” “project,” “seek,” “should,” “target,” “will,” “would” or the negative of such terms or other variations thereof and terms of similar substanc e used in connec tion 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 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 assuranc e that they will prove to be correc t. 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 tariff 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 exac erbate other risks and uncertainties; • inflation and actions taken by central banks to counter inflation; • 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 and deferred acquisition consideration; • 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; • adverse tax consequences for the Company, its operations and its stoc kholders, that may differ from the expectations of the Company, including that future changes in tax laws, potential increases 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 connec tion with the business combination that formed the Company in August 2021, including the incurrence of material Canadian federal income tax (inc luding 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 f inancial statements; • 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 conflic ts between Russia and Ukraine and in the Middle East), terrorist activities, natural disasters, public health events and tariff and trade policies; • Stock price volatility; and • foreign currency fluctuations. Investors should carefully consider these risk factors, other risk factors described herein, and the additional risk factors outlined in more detail in our 2024 Form 10-K, filed with the Securities and Exchange Commission (the “SEC ”) on March 11, 2025, and accessible on the SEC ’s website at www.sec.gov, under the caption “Risk Factors,” and in the Company’s other SEC filings. FORWARD LOOKING STATEMENTS & OTHER INFORMATION 2


 
DEFINITIONS OF NON-GAAP FINANCIAL MEASURES 3 In addition to its reported results, Stagwell Inc. has included in this earnings presentation 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: Pro Forma Results: The Pro Forma amounts presented for each period were prepared by combining the historical standalone state ments of operations for each of legacy MDC and SMG. The unaudited pro forma results are provided for illustrative purposes only and do not purport to represent what the act ual consolidated results of operations or consolidated financial condition would have been had the combination actually occurred on the date indicated, nor do they purport to proje ct the future consolidated results of operations or consolidated financial condition for any future period or as of any future date. The Company has excluded a quantitative reco nciliation of Adjusted Pro Forma EBITDA to net income under the “unreasonable efforts” exception in Item 10(e)(1)(i)(B) of Regulation S-K. 1) Net New Business: Estimate of annualized revenue for new wins less annualized revenue for losses incurred in the period. 2) Adjusted EBITDA: defined as Net income excluding non-operating income or expense to achieve operating income, plus depreciation and amortization, stock-based compensation, deferred acquisition consideration adjustments, and other items. Other items include restructuring costs, acquisition-related expenses, and nonrecurring items. 3) Adjusted Diluted EPS is defined as (i) Net income (loss) attributable to Stagwell Inc. common shareholders, plus net income attributable to Class C shareholders, excluding amortization expense, impairment and other losses, stock-based compensation, deferred acquisition consideration adjustments, discrete tax items, and other items, divided by (ii) (a) the per weighted average number of common shares outstanding plus (b) the weighted average number of Class C shares outstanding (if dilutive). Other items includes restructuring costs, acquisition- related expenses, and non-recurring items, and subject to the anti-dilution rules. 4) Free Cash Flow: defined as Adjusted EBITDA less capital expenditures, change in net working capital, cash taxes, interest, and distributions to minority interests, but excludes contingent M&A payments. 5) Financial Guidance: The Company provides guidance on a non-GAAP basis as it cannot predict certain elements which are included in reported GAAP results. Included in this earnings presentation are tables reconciling reported Stagwell Inc. results to arrive at certain of these non-GAAP financial measures.


 
4 FINANCIAL Outlook Reiterating Full-Year 2025 Outlook ~ 8% Total Net Revenue Growth $410M - $460M Adjusted EBITDA > 45% EBITDA Conversion on Free Cash Flow $0.75 - $0.88 In Adjusted Earnings Per Share Note: Guidance as of 05/08/2025. The Company has excluded a quantitative reconcil iation with respect to the Company’s 2025 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 on defini tions for Organic Net Revenue, Organic Net Revenue ex. Advocacy, Adjusted EBITDA, Adjusted Earnings Per Share, and Free Cash Flow. Please refer to our investor website at stagwellglobal.com/investors for information on Forwar d Looking Statements and risk factors outlined in our 2024 Form 10-K, filed with the Securities and Exchange Commission (the “SEC”) on March 5 2025, and accessible on the SEC’s website at www.sec.gov, under the capt ion “Risk Factors,” and in the Company’s other SEC fi lings.


 
F I R S T Q U A R T E R H I G H L I G H T S NET REVENUE: $564M | NET LEVERAGE RATIO: 3.3x | ADJ. EBITDA: $81M Innovating IN TECHNOLOGY Growing OUR BUSINESS Scaling CAPABILITIES & REACH Record-Breaking NEW BUSINESS Nearly 200% growth in Quest Brand for 1Q with the addition of BERA.ai Continued investing in Stagwell Marketing Cloud to service blue-chip clients like BBC, Intel, Amazon, HP, Lenovo, and PayPal Deepened our relationship with Adobe, debuting Code and Theory's content supply chain solution at Adobe Summit with ~700 demos and leads Rolled out version 1 of Stagwell ID Graph with 130M unique emails Launched AI-powered tools like Quest Brand's CustomQuest, which delivered >70% organic growth YoY Record $130M of net new business wins in 1Q25, bringing LTM to $446M Secured high-profile new customer wins with leading companies including Starbucks, Visa, PayPal, Panera, CarMax, Celsius, and Hyatt Grew relationships with fast-growing marketing verticals, with an 18% increase in tech spend and a 52% increase in retail Net Revenue growth ex. Advocacy of 9% year-over-year Digital Transformation grew 15% ex. Advocacy over the prior period Stagwell Marketing Cloud posted 45% ex. Advocacy growth year-over-year Consumer Insights returned to positive year-over-year growth Announced 3 acquisitions YTD to expand global reach and sports marketing capabilities Announced intent to acquire ADK Global in Q1, which will complete our APAC offering and add 10 new offices in the region Acquired sport marketing agency Gold Rabbit Sports in Q1 to bolster sports and entertainment services and experiential capabilities Acquired JetFuel in early Q2, an experiential agency bringing expertise in live brand experiences, retail and shopper marketing, and digital activations Note: Net Leverage Ratio defined as Net Debt divided by LTM Adjusted EBITDA.


 
O U R P R I N C I P A L C A P A B I L I T I E S Creativity & Communications Blue-Chip Customer Base Performance Media & Data Addressable on a Global Scale Consumer Insights & Strategy Tracking Across the Entire Consumer Journey Digital Transformation Building & Designing Digital Platforms & Technology 2 3 4 5 6 57% 1Q25Stagwell Marketing Cloud Group SaaS and DaaS Tools for the Modern Marketer 1 Notes: Digital Revenue Percentage is percentage of Total Net Revenue from Stagwell Marketing Cloud Group, Digital Transformation, Performance Media & Data, and Consumer Insights & Strategy capabilities


 
G L O B A L N E T W O R K 7 North America Latin America Europe Asia Pacific • Australia • China • Hong Kong • India • Indonesia • Japan • Malaysia • Philippines • Taiwan • Thailand • Singapore • South Korea Middle East & Africa • Austria • Belgium • Bulgaria • Italy • Latvia • Romania • Slovak Republic • Slovenia • Switzerland • Turkey • Ukraine • France • Germany • Netherlands • Poland • Spain • Sweden • United Kingdom • Argentina • Aruba • Bolivia • Brazil • Curacao • Colombia • Costa Rica • Dominican • Ecuador • El Salvador • Guatemala • Honduras • Jamaica • Nicaragua • Panama • Peru • Republic • Uruguay • Venezuela • Algeria • Bahrain • Egypt • Jordan • Kuwait • Lebanon • Libya • Morocco • Nigeria • Oman • Saudi Arabia • South Africa • Tunisia • United Arab Emirates Stagwell Affiliates COUNTRIES 45+ 75+ EMPLOYEES 11K+ 21K+ Stagwell’s Affiliate Network Significantly Expands Our Global Footprint • Canada • USA • Mexico Note: As of March 31, 2025.


 
S U M M A R Y C O M B I N E D F I N A N C I A L S Note: Figures may not foot due to rounding. Three Months Ended March 31, 2025 2024 Net Revenue $ 564,187 $ 532,454 Billable Costs 87,553 137,605 Revenue $ 651,740 $ 670,059 Billable Costs 87,553 137,605 Staff costs 368,262 342,157 Administrative costs 75,109 67,163 Unbillable and other costs, net 40,234 32,818 Adjusted EBITDA $ 80,582 $ 90,316 Stock-based compensation 11,543 16,116 Depreciation and amortization 42,006 34,836 Deferred acquisition consideration 6,657 154 Impairment and other losses - 1,500 Other items, net 2,091 11,856 Operating income $ 18,285 $ 25,854 Adjusted EBITDA margin (on net revenue) 14.3% 17.0% 8 $ in Thousands


 
78.1% 6.4% 15.5% 1 Q 2 5 N E T R E V E N U E B Y G E O G R A P H Y Note: Figures may not foot due to rounding. 1Q Total Growth Y/Y 9 % OF NET REVENUE Geography 1Q25 United States 1.4% United Kingdom (2.3)% Other 43.6% TOTAL 6.0% TOTAL EX-ADVOCACY 9.1%


 
1 Q 2 5 G R O W T H B Y C A P A B I L I T Y Notes: Advocacy includes Targeted Victory, SKDK, and TMA Direct. Figures may not foot due to rounding. EBITDA includes corporate expenses, notionally allocated ratably across each capability. 1Q25 Principal Capability Net Revenue Growth Adjusted EBITDA Growth Stagwell Marketing Cloud Group 32.0% (274.8)% Digital Transformation 7.9% 31.9% Performance Media & Data (9.8)% (51.8)% Consumer Insights & Strategy 7.6% (2.8)% Creativity & Communications 7.3% 8.8% TOTAL 6.0% (10.8)% TOTAL EX-ADVOCACY 9.1% (2.2)% % OF NET REVENUE 1Q 11% 19% 18% 9% 43%


 
Three Months Ended, March 31, 2025 March 31, 2024 % Change Total Net Revenue $564 $532 6.0% Advocacy Net Revenue 29 42 -30.2% Total Ex Advocacy 535 490 9.1% Three Months Ended, March 31, 2025 March 31, 2024 % Change Total Adj. EBITDA $81 $90 -10.8% Advocacy Adj. EBITDA 5 13 -60.2% Total Ex Advocacy 75 77 -2.2% E X - A D V O C A C Y N E T R E V E N U E & A D J U S T E D E B I T D A Note: Advocacy includes Targeted Victory, SKDK, & TMA Direct. Actuals may not foot due to rounding $ in Millions NET REVENUE ADJ. EBITDA 11


 
N E W B U S I N E S S U P D A T E 12 PER CLIENT AT TOP 25 Notable Business WINS & EXPANSIONS Net New Business 1Q25 $130M LTM $446M Avg. Net Revenue 1Q25 $6.8M


 
S T A G W E L L M A R K E T I N G C L O U D G R O U P 13 Net Revenue1 1. Defined as GAAP Revenue minus Billable Costs – Includes both the Advanced Media Platform and Stagwell Marketing Cloud groups. In Millions. Numbers may not foot due to rounding. Net Revenue Adj. EBITDA Margin Advanced Media Platforms $34.8 (3.5)% Stagwell Marketing Cloud $28.4 (11.8)% TOTAL $62.8 (7.7)% GROWTH (y/y) 24.1% $48M $63M 1Q24 1Q25 $ in Millions


 
14 LIQUIDITY Available Liquidity (as of 03/31/2025) Commitment Under Credit Facility $ 640 Drawn 375 Letters of Credit 15 Undrawn Commitments Under Facility $ 250 Total Cash & Cash Equivalents 138 Total Available Liquidity $ 388 $ in Millions Note: Numbers may not foot due to rounding.


 
15 MAINTAINING DISCIPLINE AROUND Deferred Acquisition Costs DAC DECREASED BY $8M FROM 1Q24 QUARTER-END BALANCE $73M FROM 1Q23 QUARTER-END BALANCE Numbers may not foot due to rounding. 166M 101M 93M 1Q23 1Q24 1Q25


 
A D J U S T E D E A R N I N G S P E R S H A R E Three Months Ended March 31, 2025 Reported (GAAP) Adjustments Non-GAAP Net income (loss) attributable to Stagwell Inc. common shareholders $ (2,917) $ 18,439 $ 15,522 Net income (loss) attributable to Class C Shareholders (6,637) 24,513 17,876 Net income (loss) attributable to Stagwell Inc. common and Class C shareholders $ (9,554) $ 42,952 $ 33,398 Weighted average number of common shares outstanding 112,088 9,462 121,550 Weighted average number of common class C shares outstanding 151,649 - 151,649 Weighted average number of shares outstanding 263,737 9,462 273,199 Diluted and Adjusted Diluted earnings (loss) per share $ (0.04) $ 0.12 Adjustments to net income (loss) Amortization expense $ 32,981 Impairment and other losses - Stock-based compensation 11,543 Deferred acquisition consideration 6,657 Other items, net 2,091 Total add-backs 53,272 Adjusted tax expense (10,320) $ 42,952 16 $ and Shares in Thousands Note: Numbers may not foot due to rounding.


 
G A A P C O N S O L I D A T E D O P E R A T I N G P E R F O R M A N C E Note: Numbers may not foot due to rounding. 17 $ and Shares in Thousands Three Months Ended March 31, 2025 2024 Revenue $ 651,740 $ 670,059 Cost of services 412,087 444,526 Office & general expenses 179,362 163,343 Depreciation & amortization 42,006 34,836 Impairment & other losses - 1,500 Total operating expenses $ 633455 $ 644,205 Operating income (Loss) $ 18,285 $ 25,854 Interest expense, net (23,356) (20,965) Foreign exchange, net 1,220 (2,258) Gain on sale of business - - Other, net 249 (1,267) Other income (expenses) $ (21,887) $ (24,490) Income (loss) before income taxes and equity in earnings of non-consolidated affiliates (3,602) 1,364 Income tax expense 1,722 2,585 Loss before equity in earnings of non-consolidated affiliates $ (5,324) $ (1,221) Equity in income (loss) of non-consolidated affiliates (1) 508 Net loss $ (5,325) (713) Net (income) loss attributable to non-controlling & redeemable non-controlling interests 2,408 (569) Net loss attributable to Stagwell Inc. common shareholders $ (2,917) $ (1,282) Loss Per Share Basic $ (0.03) $ (0.01) Diluted $ (0.04) $ (0.01) Weighted Average Number of Shares Outstanding Basic 112,088 112,633 Diluted 263,737 116,405


 
C A P I T A L S T R U C T U R E Note: Share count assumes full conversion of Class C shares to Class A on a one-to-one basis. Numbers may not foot due to rounding 1. Excludes non-controll ing interest of Stagwell Class C shareholders to reflect NCI balance pro forma for full conversion of Class C shares to Class A. 2. A portion of the DAC will be paid with approximately 7.0m shares assuming conversion as of 3/31/25. 3. Includes redeemable non-controll ing interest and obligations in connection with profit interests held by employees. 4. Non-consolidated investments 5. Share Count does not include unvested stock grants, unsettled SARs or portion of DAC to be settled in stock. Pro Forma total share count as of 4/30/2025 would be 267.7m Class A shares, 7.1m shares to settle DAC and 7.8m share-based awards, for a total of 280.8m shares outstanding. In addition, the share count does not reflect the 2.0m Class A shares issued on 5/1/2025 in conjunction with the close of the JetFuel acquisition. 6. Effective April 2, 2025, all outstanding shares of Class C Common Stock were converted to shares of Class A Common Stock in connection with the Class C Exchange 7. Estimated shares to be issued upon the exercise of settled SAR awards using treasury method. Net Debt & Debt-Like ($M, as of 3/31/2025) Revolving Credit Facility $ 375 Bonds 1,100 NCI1 21 DAC2 93 RNCI3 29 Less: Investments4 16 Less: Cash 138 TOTAL NET DEBT & DEBT-LIKE $ 1,464 Share Count5 (Thousands, as of 4/30/2025) Class A 265,765 Class C6 (equal voting & economic rights to Class A) - Share-based awards7 7,881 DILUTED 273,646 18


 
19 APPLYING A PROVEN PLAYBOOK to scale Stagwell Marketing Cloud Group Building complementary software solutions leveraging the domain expertise and distribution channels already in place at Stagwell Advanced Media Platforms Proprietary & Premium Owned Media Channels Media Studio Solution for Modern Media Planners and Buyers Harris Quest Research Market Research Products by The Harris Poll PRophet Comms Tech AI-Driven Platform for Modern Communicators Digital Services Technology Digital Transformation Building Digital Platforms & Consumer Experiences Performance Media & Data Integrated Omnichannel Media, Data & E-Commerce Consumer Insights & Strategy Tracking Across the Consumer Journey Creativity & Communications Blue-Chip Customer Base 1 2 3 4


 
20 We've developed a proven strategy to develop and incubate new technologies, making informed product roadmap decisions based off agency clients while leveraging our world-class tech team STAGWELL MARKETING CLOUD GROUP Product Incubation Playbook WE BUILD ADVANCED PRODUCTS MORE EFFICIENTLY than the rest Faster Shared infrastructure + tech expertise DEVELOP & ITERATE FAST Cheaper World's most ambitious clients + upselling opportunities LOWER GO-TO-MARKET COSTS Better Proprietary data + the best marketers in the world INTERNAL TESTING & INSIGHTS THAT DELIVER BETTER PRODUCTS


 
21 REAL-TIME INSIGHTS Product Spotlight Customer Benefit Unlocking continuous brand tracking on an affordable, global, modern basis for research professionals


 
22 ARTIFICAL INTELLIGENCE Product Spotlight Customer Benefit Revolutionizing the PR process through AI, saving PR professionals from millions of tedious working hours


 
23 AUGMENTED REALITY Product Spotlight Customer Benefit Bringing a whole new level of stadium entertainment and fan engagement to sports and entertainment through shared AR


 
24 STAGWELL MARKETING CLOUD GROUP Pricing Model Modern, flexible pricing models that fit the needs and budgets for the modern marketer Subscription Pricing Annual SaaS contract Consumption Fee Data and media spend Advertising-Based Sponsorship fees


 
Thank You Contact Us: IR@StagwellGlobal.com