Advantage Solutions (ADV) Q1 2026 earnings summary

Executive summary

• Revenues for Q1 2026 increased 5.8% year-over-year to $869.6 million, led by Experiential and Retailer Services growth, while Branded Services declined.

• Adjusted EBITDA rose 16.4% to $67.7 million, with margin improvement and strong performance in Experiential Services.

• Net loss widened to $71.8 million from $56.1 million, mainly due to higher debt issuance costs and increased income tax expense.

• Centralized labor model and technology transformation initiatives are enhancing execution, productivity, and margins.

• Significant debt reduction and refinancing extended maturities to 2030, ending Q1 with $144 million in cash.

Financial highlights

• Q1 2026 revenues: $869.6 million (+5.8% YoY); Adjusted EBITDA: $67.7 million (+16.4% YoY); margin improved to 7.8%.

• Adjusted Unlevered Free Cash Flow was $74.4 million, representing 109.8% of Adjusted EBITDA.

• Net leverage ratio stood at 4.2x LTM Adjusted EBITDA, with $1.45 billion in net debt.

• Cost of revenues decreased as a percentage of revenue to 87.6% from 87.9% YoY; SG&A expenses fell to 6.1% of revenue.

• Cash flow from operations was $23.7 million, up from a $39.6 million outflow YoY.

Outlook and guidance

• Fiscal 2026 revenue expected to be flat to up low single digits; Adjusted EBITDA flat to down mid-single digits.

• Adjusted Unlevered Free Cash Flow guidance: $250–$275 million; net FCF conversion ~25% of EBITDA.

• Capex projected at $50–$60 million; net interest expense $160–$170 million.

• Additional restructuring costs of $4–6 million anticipated through 2027.

• Guidance excludes reimbursable expenses and effects of recent divestitures.