Earnings call transcript: Stagwell Q4 2024 earnings meet forecasts, stock rises

Stagwell Inc. (STGW) reported its fourth-quarter earnings for 2024, meeting analysts’ expectations with an earnings per share (EPS) of $0.24 and revenue of $789 million. The company’s revenue surpassed forecasts by approximately 5%, reflecting a strong performance. In premarket trading, Stagwell’s stock rose by 2.09% to $6.85, indicating positive investor sentiment. According to InvestingPro analysis, the company appears undervalued against its Fair Value, presenting a potential opportunity for investors. With a market capitalization of $1.79 billion, Stagwell has shown significant momentum, delivering a 27.45% return over the past year.

Key Takeaways

• Stagwell’s Q4 revenue grew by 20% year-over-year, reaching $789 million.
• The company invested heavily in AI and cloud solutions, totaling $23 million in Q4.
• Stagwell repurchased 14.8 million shares in 2024, enhancing shareholder value.
• Digital transformation revenue increased by 22% in Q4.
• The stock price increased by 2.09% in premarket trading following the earnings release.

Company Performance

Stagwell Inc. demonstrated robust growth in the fourth quarter of 2024, with a 20% increase in revenue compared to the previous year. The company’s strategic investments in technology and AI have begun to pay off, contributing to its strong performance. With a beta of 1.73 and strong price momentum, as reported by InvestingPro, the stock exhibits higher volatility than the market average. Stagwell’s expansion into international markets, including the Middle East, Europe, Latin America, and Asia, further bolstered its revenue streams, supporting its 4.92% trailing twelve-month revenue growth.

Financial Highlights

• Revenue: $789 million (up 20% YoY)
• Net Revenue: $630 million (up 14% YoY)
• Full Year Revenue: $2.84 billion (up 12% YoY)
• Adjusted EBITDA for Q4: $123 million
• Full Year Adjusted EBITDA: $411 million (18% margin)
• EPS: $0.24 (met expectations)

Earnings vs. Forecast

Stagwell’s earnings per share of $0.24 met analysts’ forecasts, while its revenue of $789 million exceeded expectations by approximately 5%, or $38.37 million. This performance aligns with the company’s historical trend of meeting or slightly surpassing market expectations.

Market Reaction

Following the earnings announcement, Stagwell’s stock price rose by 2.09% in premarket trading, reaching $6.85. This increase suggests a positive reaction from investors, likely driven by the company’s revenue beat and optimistic outlook for its technology investments.

Outlook & Guidance

For 2025, Stagwell projects total net revenue growth of approximately 8% and adjusted EBITDA between $410 million and $460 million. The company anticipates a decline in advocacy revenue by 30% but expects non-advocacy organic growth to range between 5.5% and 7.5%. Stagwell is also preparing for the launch of "The Machine," an AI-based content development platform, slated for release in the summer.

Executive Commentary

Mark Penn, CEO of Stagwell, described 2024 as a "breakthrough year" for the company, emphasizing its strategic investments in AI. Frank Lanuta, CFO, highlighted Stagwell’s position as a "Goldilocks company," balancing collaboration and scale effectively.

Risks and Challenges

• Potential decline in advocacy revenue by 30%, impacting overall growth.
• Market saturation in technology sectors could limit expansion opportunities.
• Macroeconomic pressures may affect advertising budgets and client spending.
• Competition in AI and digital transformation markets remains intense.
• Geopolitical tensions could disrupt international expansion plans.

Q&A

During the earnings call, analysts inquired about Stagwell’s growth strategy and its competitive positioning amid industry consolidation. Executives emphasized the company’s robust RFP activity, projecting $1.5 billion in 2025, and reiterated their commitment to AI-driven digital transformation.

Full transcript - Stagwell Inc (STGW) Q4 2024:

Ben Allinson, Investor Relations Lead, Stagwell Inc.: Good morning from Stagwell’s offices in Florida. Welcome to Stagwell Inc. Fourth Quarter and Full Year twenty twenty four Earnings Webcast. My name is Ben Allinson, and I lead the Investor Relations function here at Stagwell. With me today are Mark Penn, Stagwell’s Chairman and Chief Executive Officer and Frank Lanuta, the Chief Financial Officer.

Mark will provide a business update and Frank will share a financial review. After the prepared remarks, we will open the floor for Q and A. You’re welcome to submit questions through the chat function. Before we begin, I’d like to remind you that the following remarks include forward looking statements and non GAAP financial data. Forward looking statements about the company, including those related to earnings guidance, are subject to uncertainties and risk factors addressed in our earnings release, slide presentation and the company’s SEC filings.

Please refer to our website, stagwellglobal.com/investors for an investor presentation and additional resources. This morning’s press release and slide deck provide definitions, explanations and reconciliations of non GAAP financial data. And with that, I’d like to turn the call over to our Chairman and CEO, Mark Penn.

Mark Penn, Chairman and Chief Executive Officer, Stagwell Inc.: Thank you, Ben, and thank you for everyone joining us for our earnings call. Twenty twenty four was a breakthrough year for Stagwell. We reestablished ourselves as the fastest growing business in the industry, accelerated rapidly in digital transformation, and worked diligently in an unprecedented US election cycle and made strategic investments to expand our capabilities and geographical reach. The result of Stagwell’s twenty twenty four work sets the stage for another period of best in class growth in 2025 and beyond. Q4 marked a continuation of the improving trends we saw throughout the year.

During the quarter, we grew revenue by 20%, net revenue by 14%. These results were driven by continued strong momentum in digital transformation, which grew revenue by 22%, net revenue by 15% year over year, and by performance media and data, which grew revenue by 12% and net revenue by 16% year over year. Adjusted EBITDA for the fourth quarter was $123,000,000 as we continue to invest in growing our cloud and AI based software solutions. We also made strong progress in managing our cost structure, bringing our comp to revenue ratio down to 57.5%, a record low for Stagwell. For the full year, Stagwell posted revenue of $2,840,000,000 growth of 12% over the prior year net revenue of $2,300,000,000 growth of 7% and adjusted EBITDA of $411,000,000 representing an 18% margin and improvement of 120 bps versus twenty twenty three.

Stagwell’s return to industry leading growth was due to five breakthroughs. First, we saw a rebound followed by an acceleration in our digital transformation businesses. We saw a growth of 12% among our tech customers within digital transformation in the fourth quarter, led by CodeN Theory’s unique blend of engineering expertise and creative ability. Ahead of Election Day, Code and Theory launched Context Lens in collaboration with RealClearPolitics, a cutting edge anticipatory generative AI tool that offers relevant visual polling data for deeper insight into political trends. And Left Field Labs created Best Phones Forever AI Road Trip, a generative AI powered campaign for Google (NASDAQ:GOOGL) Pixel, which used Gemini and Imagine to respond to fan suggestions.

The interactive adventure was Google Pixel’s highest performing Instagram post. This is just a taste of what we can do with AI for brands. As I discussed with Elon Musk at CES in early January twenty twenty five, this is the year where companies begin to recognize what AI can do and build applications around it, and our digital transformation agencies are ready to do just that. Second, results were strengthened by the culmination of the US election cycle with an unprecedented political ad spend. Our advocacy businesses grew 80% in the fourth quarter.

Targeted Victory raised 400,000,000 in low dollar contributions and supported over a hundred candidates and political groups. SKDK created, printed, and sent over 86,700,000 pieces of mail, wrote over 3,000 scripts, and produced nearly a thousand ads and a hundred film shoots. Wundercave, our best in class AI powered text messaging platform, supported over 500 political and advocacy organizations sending more than 4,000,000,000 text messages to support organizations fundraising, voter contact, and get out the vote efforts. While advocacy will experience headwinds in 2025 due to the lack of a federal election cycle, we still expect it to be a solid year in advocacy. We anticipate an uptick in public affairs and issue advocacy campaigns this year and remain very optimistic looking ahead to the midterms seasons in 2026 and a twenty twenty eight presidential cycle, which should break all records with primaries on both sides.

Third, our new business momentum continued as we posted 102,000,000 in net new business, the third consecutive quarter with net new business figures in excess of 100,000,000. This brings our trailing twelve month figure to $382,000,000 yet another record for the company. This year end figure is 111,000,000 larger than in 2023, ’1 hundred and ’60 ’9 million larger than a hundred in 2022. The results in the fourth quarter were led by high profile wins with Starbucks (NASDAQ:SBUX), Stellantis (NYSE:STLA), and Target (NYSE:TGT), and we’ve seen this momentum continue into the new year with recently announced wins with MassMutual and work breaking just today with Visa (NYSE:V). These wins show that we are winning ever larger mandates with the world’s leading companies.

Our average top customer is now a $25,000,000 relationship. The thesis of Stagwell is that as we scale, we will climb the ladder up to larger and larger assignments, and that is exactly what is happening now. Our number one client scales to over $80,000,000 of work a year, and tech companies are four out of five of our top clients underscoring that we are truly a tech company’s tech company. Fourth, Stagwell made significant investments to enhance our tools to help marketers. In the fourth quarter, we invested $23,000,000 in OpEx to grow our cloud and AI based software solutions.

This brings our full year investment in the Stagwell Marketing Cloud to approximately $70,000,000 These investments are beginning to pay off as the Stagwell Marketing Cloud delivered 24% revenue growth in the fourth quarter, the third consecutive quarter of double digit growth. And so our long term margin is considerably understated by these OpEx investments. We also made strong progress in our Stagwell ID Graph to centralize our data and information to better target consumers. And we are on the cusp of launching The Machine, a fully integrated AI based content development platform built in conjunction with Adobe (NASDAQ:ADBE). Both are scheduled for summer launch.

Finally, Stagwell was also aggressive in M and A throughout 2024, announcing 11 transactions. Our biggest move was our push in The Middle East, a region in which we see a number of opportunities. Led by the acquisition of Consolum, a highly regarded public affairs agency, and of leaders in Israeli social agency, we saw more than a 50% growth in net revenue in the region in 2024 as we’ve grown our headcount to more than 500 people there. We continue to push in the region and close the year strongly by announcing our intent to acquire Create Group, a deal that should close before the end of the first quarter. We also augmented our presence in Europe with the acquisitions of Sidekick, a UK digital and experiential agency and WNP, a best in class French creative agency.

In Latin America, we added a foothold with PROS, a Brazilian PR and social agency. And early in 2025, we announced our agreement to acquire ADK Global, which will give us offices in 10 Asian markets and increases our headcount in the region to over 2,000. From a capability standpoint, we added to our multicultural and experiential expertise with the addition of Team Epiphany, while strengthening SMC’s suite of SaaS products through the acquisitions of Unicepta, an AI enabled social listening and media monitoring company, and BaraDot AI, an AI based brand tracking product. We believe that Stagwell’s M and A machine is underappreciated by the investment community. Over the last nine years, Stagwell has grown from an idea to more than $2,800,000,000 revenue company, and it is it is there today because of the investment platform we have built combined with the incredible organic growth opportunities afforded by the expanding network that these acquisitions are placed into.

The result of these five breakthroughs was a second half that comfortably outstripped the industry. Our second half total net revenue growth of 11% was more than 400 basis points stronger than our nearest competitor, while our organic net revenue growth of 9% was almost 300 basis points. Stagwell is uniquely positioned heading into 2025 to take advantage of a rapidly changing industry landscape. No one else has our Goldilocks brand blend of industry leading capabilities, geographical scale, and meaningful size. We’re excited for what the new year will bring, and we’re confident in issuing 2025 guidance of total net revenue growth of approximately 8%, adjusted EBITDA of $410,000,000 to $460,000,000, free cash flow conversion of over 45%, adjusted earnings per share of 0.75 to $0.88 I think it’s important to look not just at organic growth, but our total growth as we are aggressively adding new geographies.

And we are still a relative teenager on the on the way up the ladder of scale. We’ll guide to total growth from now on. But to avoid any confusion as we make this transition, we expect next year advocacy to fall off by about 30%, but non advocacy to grow organically in the 5.5% to 7.5% range, led by double digit growth of our digital transformation units. Putting all of this together with when you look at the the decline of the political cycle and our continued organic growth and our new acquisitions, we expect to achieve 8% total growth in 2025. And understanding the components of total growth is the key to understanding our path to unlimited future growth and scale.

Before Frank Lenuto, our Chief Financial Officer, walks through some of our financial results in more detail, I wanted to share with you a short video with you that shows just how transformational 2024 was for Stagwell. The video combined scenes from some of our best work enhanced with AI and driven by Adobe’s innovative new AI based Firefly video tool that we are beta testing. The video showcases Stable’s outstanding client work, new innovations, and incredible wins from across the network. Let’s roll.

Frank Lanuta, Chief Financial Officer, Stagwell Inc.: Twenty twenty four was a breakthrough year for Stagwell. The Challenger Network delivered industry leading growth for the quarter with 630,000,000 in net revenue, a 123,000,000 in adjusted EBITDA and for the year with double digit expansion and 2,800,000,000.0 in revenue, 2,300,000,000.0 in net revenue and $411,000,000 in adjusted EBITDA. We achieved $382,000,000 in net new business, another company record. Our breakthrough growth was driven by

Unidentified Speaker: I’m back.

Frank Lanuta, Chief Financial Officer, Stagwell Inc.: Best in class client work and winning multi year assignments, strategic global expansion, strong performance in digital and the Stagwell Marketing Cloud, and an historic year for advocacy. We are the Goldilocks company. The right mix of collaboration and scale.

Unidentified Speaker: 10 out of 10.

Frank Lanuta, Chief Financial Officer, Stagwell Inc.: In 2025, we will drive another year of transformational growth.

Mark Penn, Chairman and Chief Executive Officer, Stagwell Inc.: That’s Redhawk.

Unidentified Speaker: Thank you, Mark. Good morning, everyone, and thank you for joining us to discuss our fourth quarter and full year results. As a reminder, if you would like to ask a question after prepared remarks conclude, please feel free to submit them through the chat function. Stagwell delivered strong fourth quarter financial results, capping a breakthrough year for the company. For the quarter, we reported revenue of $789,000,000 an increase of 20% as compared to the same period in the prior year and net revenue of $630,000,000 an increase of 14% over the prior period.

For the full year, revenue grew 12% to 2,840,000,000.00, and net revenue grew 7% to 2,300,000,000.0. In the fourth quarter, digital transformation revenue grew 22% to a hundred and $82,000,000 led by strong performances in our advocacy businesses as well as growth of 12% among tech customers. We have seen an uptick in the number of AI projects that our digital transformation agencies have been selected for, indicating that we are at the beginning of a new wave of AI driven digital transformation work. For the full year, digital transformation grew 13% to $718,000,000 Staghorn Marketing Cloud posted $81,000,000 of revenue in the fourth quarter, an increase of 24% over the year prior year, driven by significant growth in WonderCave, our advocacy focused text messaging platform, as well as strength among our retail, communications, and technology customers. For the full year, SNC grew 19% to $280,000,000 in revenue.

Performance media and data reported $89,000,000 in revenue in the fourth quarter with growth accelerating to 12% over the prior period. The growth was driven by continued strength in the consumer products, health care, and business services sectors. The strength in technology, which began in the third quarter, continued in q four as the sector’s revenue grew more than 60%. For the full year, revenue grew to $324,000,000 a year over year increase of 10%. Creativity and communications delivered $387,000,000 of revenue in the fourth quarter, an increase of 25% over the prior period.

The results were driven by significant new business wins in the retail, technology, and automotive sectors, organic growth with our existing customers, and by strength in our advocacy businesses. For the full year, revenue grew to 1,330,000,000.00, an increase of 14% over the prior year. And consumer insights and strategy reported $50,000,000 of revenue in the fourth quarter, a decrease of 1% as compared to the prior year. For the full year, revenue was a hundred $90,000,000, a decrease of 1% over the prior year. Results in the fourth quarter and for the full year were bolstered by a record breaking political season.

Advocacy revenue in the fourth quarter rose to a hundred and $27,000,000, an increase of 80% year over year and 46% over the prior political cycle. For the full year, advocacy revenue increased 72 to $363,000,000 an increase of 18% over the prior political cycle. And excluding advocacy, total company revenues increased 13% year over year in the fourth quarter and 7% for the full year. Moving to operating expenses. We continue to improve margins through effective cost management.

Personnel costs, excluding incentives, our single largest expense declined in the fourth quarter to 57 and a half percent of net revenue or 320 basis points lower versus the prior period. We also made further progress on our cost savings initiatives in the fourth quarter and throughout ’24. In the fourth quarter, we identified and actioned approximately $6,000,000 in annualized real estate savings through the consolidation of legacy office space into our regional hub model. This brings our 24 annualized real estate synergies to more than $10,000,000 We also identified and actioned more than $4,000,000 in in additional annualized savings through the centralization of software and technology costs. As a result, Stagull delivered a hundred and $23,000,000 in adjusted EBITDA in the fourth quarter with a margin of 19.6 on net revenue, an improvement of approximately two thirty basis points over the prior period.

Excluding our cloud investment of $23,000,000 this quarter, our fourth quarter adjusted EBITDA margin would have been approximately 23.2%. For the full year, adjusted EBITDA came in at $411,000,000 representing a margin of 18% on net revenue, an improvement of a 20 basis points over the prior year. Again adjusting for our cloud investment, our full year margin would have been approximately 21%. Now moving to the balance sheet, we continue to focus on capital allocation to maintain a strong financial position. Our DAC balance ticked up in the fourth quarter as we added a number of larger acquisitions.

At $102,000,000 the DAC balance is in line with the year end 2023 balance, but is approximately still $60,000,000 less than that of year end 2022. Throughout 2024, we announced 11 acquisitions and continue to focus on keeping our DAC balance at prudent levels through appropriate structuring of transactions. We also reduced NCI balances by approximately $10,000,000 year over year down to $22,000,000 And during the quarter, we acquired approximately 1,000,000 shares at an average price of $6.61 per share for approximately $7,000,000 This brings our full year repurchases to 14,800,000 shares at an average price of $6.31 or approximately 93,000,000. Our buyback authorization as of year end still had a hundred and 70,000,000 in remaining availability. CapEx and capitalized software for the quarter was $18,000,000, which is broadly in line with our targets.

Cash flows from operations for the full year improved $63,000,000 relative to 2023, driven principally by improvements in our working capital management. As a result, we ended the year with a hundred and $31,000,000 in cash and drawings under our revolver of 264,000,000 resulting in a leverage ratio of three times. And finally, as Mark noted, we are issuing full year 2025 guidance as follows. Total (EPA:TTEF) net revenue growth is expected to be approximately 8%. Adjusted EBITDA is expected to be between $410,000,000 to $460,000,000.

We expect to deliver in excess of 45% free cash flow conversion, and adjusted earnings per share is expected to be between $0.75 and $0.88 That concludes our prepared remarks for this morning. I will now turn the call back over to Ben to open the Q and A portion of the call.

Ben Allinson, Investor Relations Lead, Stagwell Inc.: Thank you, Frank. If you do have any questions, please submit them via the chat button at the top of the screen. We’re going to start with sort of the question we’ve received from a number of investors today, and this is about our change in guidance philosophy and moving to total net revenue growth. Perhaps you could just go a little bit more into why that change has come about, as well as talking a little bit about the start of the year.

Mark Penn, Chairman and Chief Executive Officer, Stagwell Inc.: Well, I think I realized that people were grossly underestimating kind of the growth machine that we have built here, you know, as we grow and we continue to scale up in the industry. We are very efficient at deploying capital at lower levels than that is then accretive to our business model as opposed to what you see in the industry where they do the opposite. But you have to combine that with the organic growth that you see is led by digital transformation. And you see we have a very strong picture of 5.5% to 7.5% non political organic growth for next year because we’re really firing on all cylinders. We are bringing in new scaled accounts at a much higher level than ever before.

We are doing expanding our network into new regions that are providing new opportunities. We’re beginning to get past the first rounds of government contracts that will add another 10% to 15% to this business. So I think people have to look at the totality of it. I think that they were missing that. Still going to be letting you figure out how organic growth is working, but we are in a very strong organic growth mode.

I had a peak at January, and the January is the strongest January that we’ve had in the history of the company.

Ben Allinson, Investor Relations Lead, Stagwell Inc.: Good stuff. Let’s maybe turn a little bit to digital transformation. A number of questions we received from analysts about digital transformation. One said up to two consecutive quarters now really, really nice strong growth in digital transformation. Could you maybe talk about any changes that we’ve seen over the course of the last, let’s call it, six months in particular, which has led to this really strong rebound and acceleration in the capability.

Mark Penn, Chairman and Chief Executive Officer, Stagwell Inc.: Well, absolutely. And and I think that I’ve been very clear at at saying that that we thought that the tech companies went into efficiency mode, and now they’re in competition mode in which AI is breaking on the scene and clients are gonna have to adapt to to AI. And we are set up with this combination of designers and engineers, in particular, to help companies implement the agentic, AI, which will really kind of be critical to the connection that companies have with consumers to redoing all of the websites now to be AI based, to really understand how the layer of information and data that we have about you will influence how both advertisements and and web construct and the things that you see when you log on or or enter a website will change based on knowing who you are. The wonderful world of of AI here is real. You can’t just build chips.

You can’t have just centralized applications. Every company needs a set of personalized, well driven AI applications. We’re gonna be coming out with some really super interesting ones. I hope people will come to an investor day that we’ve set we’ve set up in early April, which will display, I think, some of those incredible things that are being built by the digital transformation teams at Stagwell. Fantastic.

Ben Allinson, Investor Relations Lead, Stagwell Inc.: Let’s, let’s turn a little bit, a question from Jason Krier at Craig Hallum here. How would you characterize the volume of RFP activity today versus what you saw maybe last year? Maybe how are we how’s Stagwell’s positioning in such a way to ultimately take advantage of potentially upticks in RFP or changing environments in the RFP market?

Mark Penn, Chairman and Chief Executive Officer, Stagwell Inc.: We continue to have busier than ever flows of RFPs. We did over 1,300,000,000 of RFPs. We generally don’t participate in about 20% of those that we were asked, and our win ratio has been above 30%. We are clearly growing share out of these RFPs. We expect to do about 1,500,000,000 of RFPs in 2025, not counting the various government ones.

We have now put in experts at government contracts. We are the right scale and size now to begin to compete for those major contracts, you know, for recruiting, for for HHS, for for these major contracts, which are hundreds and hundreds of millions of dollars, which previously have gone only to our competitors. Good stuff.

Ben Allinson, Investor Relations Lead, Stagwell Inc.: A little bit about, about everything that’s going on in the industry at the moment. Obviously, there was a report at the December about a potential merger between two of the larger players in the industry. Laura Martin asking, as your competitors consolidate, is that good for Stagwell, bad for Stagwell, in 2025 and beyond? Maybe some thoughts that you might have on that. Look, I I don’t think people need another marketing behemoth out there.

I don’t see that the industrial logic of the Omnicom IPG

Mark Penn, Chairman and Chief Executive Officer, Stagwell Inc.: merger suggests that it is a merger of strength. It’s it’s a merger fundamentally of of weakness for companies that got too big too big and deal and are dealing with too many legacy assets. They’re gonna dump thousands and thousands of people back on the marketplace. They provide us with opportunities to pick up first rate talent who who don’t wanna be in a ship that’s getting rid of 750,000,000 of people, but wanna be on something like Stagwell where they see the future oriented growth built on the latest AI technology. We’re an exciting place.

We have over 200,000 people applying to work for our company right now. So I think that from that position, and I think also clients, as you can see, when you look at our wins from Starbucks to Visa to Target, you can see that people want a more nimble, digitally based, but high level creative shop. What we really offer is the combination of highest level creativity and technology as opposed to the idea that somehow a a a faceless, meaningless computer combined into a huge behemoth will really be the answer. That’s why I set up coming out of WPP (LON:WPP), that’s why I set up Stagwell in the first place because the market needed an alternative like Stagwell. Great.

Ben Allinson, Investor Relations Lead, Stagwell Inc.: Good stuff. Maybe a question just about the margin here, and this is from Cameron Medea and Morgan Stanley (NYSE:MS). Obviously, we talk a lot about our investments in the products and things, but where do we see our long term margin trending over time? And when do you kind of expect us to get there potentially?

Mark Penn, Chairman and Chief Executive Officer, Stagwell Inc.: Look, I think you’re gonna see the significant investments in technology probably continue through definitely through this year, probably through half of of of next year, and then I think you’re gonna see them significantly decline. I think we’re we’re building the basics that, you know, internally, the ID graph, the machine. We are we are now dedicating more and more salespeople to the products across communications, which is now a complete suite, research, which is now a complete suite, and the media pieces that we’re in the verge of putting together. So I I think you’re gonna see that for about a year and a half, and then I think you’re gonna see that decline. And you really have to look at what our real margin is probably about 25% greater than you’re seeing today.

And remember that as we take off on the tech products themselves, they tend to have 60% to 80% gross margins embedded in them as well.

Ben Allinson, Investor Relations Lead, Stagwell Inc.: Absolutely. Two more questions before we wrap up. Just a little bit on SMC, a couple of questions coming through from a number of people. Could you just maybe talk about the strong momentum we’ve begun to see in that over the second half of twenty twenty four? What are you excited about with the products heading into ’25?

Mark Penn, Chairman and Chief Executive Officer, Stagwell Inc.: I’m really excited in the communication sector now. We have really a complete suite of products. It’s very competitive. We have profit, which is, you know, earned, which is the AI, basis. We have an influencer marketing platform.

And now we have global media monitoring, which has tremendous, I think, value both for the rest of the agencies and offerings at Stagwell and for the cloud. I think in research with the addition of Barra, we now have a complete suite of research products. And I think on on the media thing, we’re now putting together a suite that will first, I think, drive internally, a very competitive product against Google Assist on data and media, where we’ll really have the latest in terms of how you apply an ID graph and how you use AI to really manage thousands of pieces of content and to vary and test them. So I think this is coming together. It’s coming together incredibly well.

I think from start, we felt it was important to have a central tech group to do services first, to get 4,000 clients, but really continue to invest in the in this technology. I think you’re gonna see again an investor day where these things are going. And let me just mention our AI our AR experience at stadiums, with sponsors like, like Uber (NYSE:UBER) and others is way ahead of anybody else.

Ben Allinson, Investor Relations Lead, Stagwell Inc.: On the Investor Day question, this is our last question for the day. Obviously, we’re gonna be holding this on April 2. It’ll be a virtual Investor Day. Day. Question from an investor, can you give us a little bit of a sneak peek as to maybe something we might be able to see at the Investor Day coming up in about a month’s time?

Mark Penn, Chairman and Chief Executive Officer, Stagwell Inc.: Look, I think the main thing for investors is you have to ask yourself, okay, is this a company with a long term growth profile? I started it nine years ago with an assistant and we’re sitting here with nearly $3,000,000,000 in revenue. B, can we scale up and be a true competitor in the industry, an industry that wants better creative, that wants more nimble adaptation of of of AI, and wants to get rid of the old fashioned models? If you answer those two questions, yes, at investor day. I think you’re gonna have to say, why aren’t more people investing at Stagwell?

And then third, you’re going to get a peek at how we’re applying the latest technologies both to clients and internally to offer better, more streamlined services. I think it’s gonna be exciting. I think that we’re really showing that the promise of what we said, which is that we would be the challenger holding company that is the Goldilocks size, not too big, not too small, just right for major clients around the world is coming to fruition.

Ben Allinson, Investor Relations Lead, Stagwell Inc.: Perfect. Well, with that, that’s the end of our Q and A section for today. Thank you so much for attending. We hope you’ll be able to join us on April 2 for our virtual investor day. Please keep an eye over the next couple of days for an invite for that as well as additional information about the day.

Thank you very much.

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