First Advantage Corp. (FA) experienced a significant 5.29% plummet in its stock price on Friday, February 28, 2025, as the company reported disappointing financial results for the full year 2024 and provided a cautious outlook for 2025.
The company's full-year 2024 earnings missed analyst expectations, with revenue of $860.2 million, up 13% from the previous year, but a net loss of $110.3 million, down sharply from a profit of $37.3 million in 2023. Earnings per share also declined from a profit of $0.26 in 2023 to a loss of $0.74 in 2024.
During the company's Q4 2024 earnings call, FA's management acknowledged the uncertain macroeconomic environment and its impact on hiring volumes, which affected the company's retail and transportation customers. Additionally, the company's recent acquisition of Sterling Check Corp. and the associated financing costs weighed on its earnings performance.
While FA expects to realize cost synergies from the Sterling acquisition, ranging from $60 million to $70 million over the next two years, the company provided a cautious outlook for 2025. FA's guidance for 2025 revenue ranges from $1.5 billion to $1.6 billion, implying flat to modest growth, with adjusted EBITDA of $410 million to $450 million and adjusted diluted EPS of $0.86 to $1.03.
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