Advantage Solutions reported third-quarter pro forma revenue of $782 million, up 1% from a year earlier, marking its fourth consecutive quarter of growth. Adjusted EBITDA fell 12% to $85 million as the company invested in staffing and faced ongoing pressure in its Branded Services segment.
Investors reacted negatively to the results. The shares fell 9.02% in regular trading to $29.15 before gaining 0.51% after hours to $29.30.
Performance varied across the company’s businesses. Experiential Services revenue rose 12% to $306 million, while its Adjusted EBITDA increased 0.3% to $35 million. Retailer Services revenue grew 1% to $251 million and Adjusted EBITDA climbed 43% to $32 million. Branded Services remained the weakest segment: revenue declined 11% to $225 million and Adjusted EBITDA fell 55% to $18 million.
Chief Executive Dave Peacock attributed the overall EBITDA decline to planned investment and continued headwinds in Branded Services. The company said the segment has been affected by client losses and pullbacks among smaller clients, although it expects performance to improve sequentially in the fourth quarter and move toward stabilization in 2027.
Advantage generated $99 million in adjusted unlevered free cash flow during the quarter, equal to 116% of Adjusted EBITDA. For the first nine months of 2026, revenue was up 3% and Adjusted EBITDA was down 3%, which management said was broadly in line with its earlier outlook.
The company reiterated its full-year 2026 guidance for flat to low-single-digit revenue growth and Adjusted EBITDA ranging from flat to down mid-single digits year over year. It also maintained its adjusted unlevered free cash flow target of $250 million to $275 million.
Advantage lowered its capital spending outlook to $40 million to $45 million after pausing its Workday implementation. It expects capital expenditures of $35 million to $40 million in 2027.
The new restructuring phase is set to begin in the fourth quarter and continue into 2027. Management expects about $25 million in annualized savings, net of investment, as well as more than $5 million in additional net savings over time. Restructuring charges are projected at $7 million to $10 million, mostly in the fourth quarter.
For the fourth quarter and full year, management expects double-digit revenue and EBITDA growth in Experiential Services. Retailer Services is forecast to be roughly flat for the year, while Branded Services is expected to improve sequentially before stabilizing in 2027.
Sources: Investing.com News.