First Advantage (FA) Q4 2025 earnings summary

Executive summary

• Delivered record Q4 and full-year 2025 results, with Q4 revenue up 12% year-over-year and adjusted diluted EPS up 67%, exceeding all updated guidance metrics.

• Completed core integration of Sterling acquisition, realizing $55 million in run-rate synergies by year-end 2025 and maintaining high customer retention rates of 96-97%.

• Announced $25 million voluntary debt prepayment and a new $100 million share repurchase authorization, totaling $95.5 million in cumulative debt repayments since the Sterling acquisition.

• Maintained strong go-to-market momentum, with robust upsell, cross-sell, and new logo activity, and introduced 2026 guidance with continued top-line momentum and a two-year adjusted diluted EPS CAGR of 20% from 2024 to 2026 midpoint.

• Introduced full year 2026 guidance, progressing toward 2028 long-term targets.

Financial highlights

• Q4 2025 revenues reached $420 million (up 11.9% year-over-year), with adjusted EBITDA of $117 million (27.8% margin, up 16.8% year-over-year), and adjusted diluted EPS of $0.30 (up 66.7% year-over-year).

• Full-year 2025 revenues were $1,574.4 million, with adjusted EBITDA of $441.4 million (28.0% margin) and adjusted diluted EPS of $1.04 (up 26.8% year-over-year).

• Adjusted operating cash flows for 2025 were $231.9 million, up 41% year-over-year; cash balance at year-end was $240 million.

• Q4 2025 net income was $3.5 million (0.8% margin); full-year net loss was $(34.8) million.

Outlook and guidance

• 2026 revenue guidance: $1,625–$1,700 million (3% to 8% growth); adjusted EBITDA: $460–$485 million (4% to 10% growth); adjusted diluted EPS: $1.15–$1.25 (11% to 20% growth).

• Free cash flow expected in the range of $160–$190 million for 2026.

• Base growth expected to remain modestly negative (0% to -2%) in 2026, with upside from go-to-market initiatives.

• Margin expansion of 40 basis points expected at midpoint, with synergies and investments supporting future growth.

• Reaffirmed 2028 long-term targets: $1.8–$2.0 billion revenue, $560–$630 million adjusted EBITDA, 31%–32% margin, $1.65–$2.00 adjusted diluted EPS.