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Sep 30, 2022

Advantage Solutions Q3 2022 Earnings Report

Advantage Solutions' third quarter performance was marked by a 13% year-over-year revenue increase, driven by recovery in in-store sampling and retail merchandising services, but faced challenges due to the tight labor market and wage inflation.

Key Takeaways

Advantage Solutions reported a 13.2% increase in revenue for Q3 2022 compared to Q3 2021. However, operating income, net income, and Adjusted EBITDA decreased due to investments in wages and macroeconomic pressures. The company is updating its fiscal year 2022 Adjusted EBITDA guidance range to $430 million to $440 million.

Revenues increased by 13.2% to $1,051.1 million compared to the third quarter of 2021.

Operating income decreased by 28.6% to $46.8 million compared to the third quarter of 2021.

Net income decreased by 4.5% to $23.2 million compared to the third quarter of 2021.

Adjusted EBITDA decreased by 11.6% to $118.3 million compared to the third quarter of 2021.

Total Revenue
$1.05B
Previous year: $929M
+13.2%
EPS
$0.2
Previous year: $0.18
+11.1%
Adjusted EBITDA
$118M
Previous year: $520M
-77.3%
Gross Profit
$143M
Previous year: $163M
-12.3%
Cash and Equivalents
$96.2M
Previous year: $168M
-42.7%
Free Cash Flow
$43.5M
Previous year: $34M
+27.8%
Total Assets
$5.81B
Previous year: $5.85B
-0.7%

Advantage Solutions

Advantage Solutions

Forward Guidance

The Company is updating its fiscal year 2022 Adjusted EBITDA guidance range to $430 million to $440 million.

Positive Outlook

  • Strong customer demand.
  • Sampling and demonstration business will continue to build back in 2023.

Challenges Ahead

  • Unprecedented tight labor market.
  • Increasing inflationary pressures.
  • Broad macro-economic uncertainty are challenging consumers, retailers and CPG brands, alike.