Advantage Solutions Inc.

Second-quarter net revenues were $757 million, up 3% year over year and 4% excluding divestitures. Adjusted EBITDA was $76 million, down 12% year over year and down 9% excluding divestitures. By segment, Branded Services generated $224 million of revenue and $22 million of adjusted EBITDA, down 13% and 36% year over year; Experiential Services generated $296 million of revenue and $34 million of adjusted EBITDA, up 19% and 32%; and Retailer Services generated $237 million of revenue and $20 million of adjusted EBITDA, up 3% and down about 25%. Cash at quarter end was $102 million, adjusted unlevered free cash flow was $19 million, and net debt was about 4.5x trailing EBITDA. Management reiterated full-year 2026 revenue and adjusted EBITDA guidance, full-year adjusted unlevered free cash flow of $250 million to $275 million, and net free cash flow conversion of 25% excluding debt refinancing costs. They also said second-half adjusted EBITDA should represent about 53% of the full-year total, with fourth-quarter adjusted EBITDA higher than third-quarter adjusted EBITDA.

Dave Peacock said the company is being shaped by a consumer environment focused on value, promotions, and measurable ROI, which favors Advantage’s execution-heavy model. He emphasized that Experiential demand remains very strong, Retailer Services should improve in the second half as larger projects ramp, and Branded Services is still in a longer recovery with modest improvement expected later. His tone was confident but measured, repeatedly stressing disciplined staffing, better operating visibility, and AI-enabled productivity rather than a near-term turnaround in all segments.

Chris Growe said divestitures were a $5 million revenue headwind and about a $3 million EBITDA headwind in Q2, and are still expected to be a roughly $20 million revenue headwind and over $10 million EBITDA headwind for 2026. He highlighted that free cash flow was pressured by elevated DSO tied to the final SAP implementation and customer payment timing, but expects DSO and working capital to improve through the second half. He also noted $15 million of share repurchases in Q2, said free cash flow will primarily go toward debt reduction, and said interest expense and capex guidance were lowered slightly even as the full-year cash flow outlook stayed unchanged.

Analysts focused on what would stabilize Branded Services into 2027, how durable the strong Experiential growth is, and whether mix pressure is depressing margins. Management said Branded is benefiting from a more fragmented client base and a rise in project work tied to out-of-stocks and retail display issues, and they pointed to growing top-25/top-30 client revenues as evidence of stabilization. On Experiential, management said demand from both existing and new customers is strong, execution rates were about 95%, and AI and labor-process improvements should help sustain growth. On Retailer Services, they framed the weak quarter as temporary and tied to project timing and a tough comparison, with improvement expected as larger projects ramp in the second half.