Good morning from Stagwell's office in Miami. Welcome to Stagwell's Third Quarter 2025 Earnings Webcast. My name is Ben Allanson, and I lead the Investor Relations function here at Stagwell. With me today are Mark Penn, Stagwell's Chairman and Chief Executive Officer; and Ryan Greene, Stagwell's Chief Financial Officer. Mark will provide a business update before Ryan shares a financial review. After the prepared remarks, we will open the floor for Q&A. You are 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.

Thank you, Ben. In an industry undergoing major transformation, there are winners and there are losers. This quarter, coming on top of consistent sequential and year-over-year growth in our non-advocacy net revenue, we're clearly positioned as one of the winners. And today's game-changing Palantir announcement is another example of that. The overall revenue number of $743 million and net revenue of $615 million reflect 12% and 10% ex advocacy increases over last year. On a 2-year stack basis, our organic ex advocacy growth was 8.4%, a meaningful acceleration over the first 2 quarters, which came -- which both came in and about 1%. We expect this figure to be in double digits in the fourth quarter. Ex advocacy EBITDA jumped 23% year-over-year to $103 million, and our ex advocacy margin of 18% is the highest we have achieved in 2 years. Ryan will talk more about the cost reduction efforts that are clearly working there. Our adjusted earnings per share of $0.24 is up 9% from third quarter last year, and our year-to-date cash flow from operations increased $100 million. Our LTM net new business increased to a record number of $472 million and top client relationships continue to expand significantly. A top 25 client is now an average $28 million relationship. Our current pipeline of $0.5 billion remains at its highest levels. Marketing Services total net revenue grew 9% and digital transformation increased by 12%. And organic growth in our key segments was strong as well. Marketing Services grew 6.5% organically overall and 9% in the U.S. market. Digital Transformation grew at 7% organically and 7% organically in the U.S. While many of the competitors in the industry are shrinking and shredding operations, we are growing and meeting the demands of the new world of AI. Investors ask, given…

Thanks, Mark. Today, I'll walk you through key reporting changes and an overview of our financial performance. This quarter, we adopted a new structure with 5 segments: Marketing Services, Media and Commerce, Digital Transformation, Communication and The Marketing Cloud, designed to simplify reporting and improve transparency. The advocacy adjustments are now limited to a single segment, communications, streamlined disclosures. Please refer to the revised earnings presentation and investor supplement posted on the Investor Relations section of our website for a restatement of prior period results and contribution percentages under the new framework. We also redefined our organic growth calculation. Revenue from acquisitions is now considered inorganic 12 months post close. This approach mirrors a leading competitor and provides a clearer view of Stagwell driven performance. Now turning to our results. In Q3, we generated $743 million of revenue. Net revenue was $615 million, up 5.9% year-over-year. Reported organic growth was down 0.4%, but when adjusted for advocacy, organic growth was 3.2% with nearly all segments achieving higher levels. Net revenue, excluding advocacy has accelerated throughout the year, 9.1% in Q2 (sic) [Q1] 9.9% in Q3 -- in Q2 and 10.2% in Q3. Adjusted EBITDA was $115 million, up 3% year-over-year, even without the higher gains from cyclical political work. Adjusted EBITDA margin on net revenue was 18.6%. Adjusted net income was $63 million, up 6%. Despite the advocacy pullback, adjusted EPS for the quarter increased 9% to $0.24. Looking at our geographical performance, the U.S. remained our largest market and key growth driver. Net revenue rose 1.1% year-over-year. Excluding advocacy, total growth was 5.9%, with organic growth of 5.2%. International total net revenue grew 25.9%, led by EMEA with a 39.6% increase. Let's take a closer look at how our operating segments contributed to overall performance. Starting with The Marketing…

Thank you, Ryan. [Operator Instructions] A lot of questions coming in and a lot of them are focused on Palantir obviously announced this morning. First one, Laura Martin at Needham. [indiscernible] can you maybe go into a little bit of the background of the Palantir, how did they come about? And then also a number of questions asking about the TAM and the size [indiscernible].

It really came about from discussions I had with Alex Karp about how we could take the unique targeting and AI capabilities of Palantir and for us to bring our unique experience in the marketing field together. And from those discussions, we set up 2 teams and the 2 teams went for 5 months developing the prototypes, which we began to show clients last month and the agreement to then go ahead and dive all the way in here to create what I consider to be the holy grail of marketing, that combination of data, technology and AI that will enable clients to say, well, let's run the back-to-school sale now and to have the marketing system bring together the content, data, find the audience and really manage and drive campaigns. And I think this is something that really will take companies -- large-scale companies who have tremendous data today, but can only use a fraction of it, and really open it up down to the retail customer manager level so that they deploy this technology. So we're really obviously excited about it, and that's how it came about, and that's how the commitment came about to move forward.

And then maybe a little bit on the TAM and the opportunity set and also kind of a deep dive into what incremental infrastructure investments or CapEx, OpEx might be required to kind of get the partnership up to speed.

Sure. I mean, look, I think the TAM is enormous. I think these are $5 million and $10 million installations. I think this is something that one way or another, every major company is going to have in today's AI-based marketing world. Will some try to develop that on their own or others do do our system? Will competitors emerge? We think as we reviewed with a recent potential customer, we said we're clearly ahead of the others out there in the marketplace in terms of able to really bring together data and AI and marketing sciences. We're already -- as I said in the speech, we made a CapEx -- we made -- I'm sorry, we made a pivot this year and said, let's take the acquisition money, let's transfer it over to technology CapEx. AI is really the important new development that transforms marketing. We are the company built to transform marketing myself with the experience in technology, Code and Theory having 1,500-plus engineers. We have the capabilities, which combined with the incredible teams at Palantir and their ability to bring things also to market. I think that gives us a tremendous opening. So I think that the TAM here is really quite enormous.

And just on timing, a couple of questions about P&L impact when it might start to flow through. Is it Q4 phenomenon? Is it a 2026 phenomenon? How you think...

I think it's definitely a 2026 phenomenon. I think that we are baking -- we're going from MVP. The teams are baking the next versions. I think in an AI world, you talk months, not years. I'm really expecting significant revenue by the end of 2026 for sure.

Great. I just wanted to throw a question to Ryan here because you mentioned the CapEx side of things. Obviously, a little bit of an uptick in CapEx this year. Could you maybe just elaborate on it a little bit more what drove that...

Sure. I think that underpins Mark's direction, the shift from acquisitions to technology. About $55 million of that is spread across a number of investments ranging from the machine, the Stagwell content supply chain is in there for content creation, product development within the marketing crowd across a host of products as well as innovations in some of the market research and the underlying data feed that feed all these systems. So Mark made this direction at the beginning of the year, you're seeing that flow through carry out in the results.

Great. I want to pivot a little bit. I have a question here sort of talking about our media business. And the question is from Steve Cahall at Wells Fargo. He goes, it appears that much of the growth in the industry is being captured by some of the larger-scale players. Do you view media as a core function for Stagwell? And if so, do you have a plan to address Stagwell's position within the media ecosystem?

Yes, our plan has very much been to upgrade our capabilities in media based on technology. We're not going to be able to beat these behemoths on the basis of scale, but we can beat them on the basis of better technology and better use of data and information. And that's exactly where we're going. So we think that as we deploy the combination here of the content supply chain, the machine and the Palantir holy grail of marketing, that will create a very competitive market -- very competitive media offering that will enable us to push that. The second strategy here is really that we are buying media so that we will have as our -- principal media is really owned media. And we're particularly focusing in the news and politics and information sector because we think that there are really good buys in media. And the truth is what's happened is viewership of politics and political events is skyrocketed with interest. So we think that's going to be a hugely valuable area that we'll be able to deliver really strong ROI media for clients.

I think part of that is the RealClearPolitics, Real Clear Holdings announcement earlier on this quarter. Could you maybe elaborate on that? Question from Barton Crockett just asking some additional color on that at the moment? Why you do it? What is the owned media strategy over there?

Yes. I think exactly we're going to be working with the RealClearPolitics team to create new innovations. I discovered when I was working at Microsoft, when you get near the elections, RealClearPolitics was the #1 search politically related team. And so it will get enormous traffic that we now have a good opportunity both for the midterms and by the presidential election to really work with the RealClearPolitics team, reengineer the sites, and I think tremendously upgrade the monetization of those sites and their effectiveness. So you're seeing unprecedented interest in news and politics. And that's where we can uniquely play against competitors in terms of owned media.

I want to pivot slightly here, just talking a little bit about communications. It's maybe the only area of weakness really within the quarter. Could you maybe talk about what we're seeing within that? How much of that is advocacy related? How much of that is sort of a broader PR-related challenge?

Well, obviously, I think -- obviously, there's a tremendous reduction in advocacy-related work in the communications sector. And I think part of that also kind of bleeds over to kind of issues and other related communications work that sort of gets kicked into next year when it gets -- when it becomes more important. But we did seem to see, if you look at the results of competitors and industry-wide softness in that particular sector. And I think that affected us. We -- I think that will kind of straighten itself out, once we go into the advocacy year. What's interesting for us is that there are winners and losers in digital transformation. And while some of the digital transformation company showed real weakness, our digital transformation efforts even before the deal we announced today already showing really significant pickup because I think that we, in advance here for the last couple of years, really positioned ourselves well to take advantage of the AI revolution. I've always said we were a services company first and then let's get 4,000 clients first, then let's build those tools and then let's take them to market. That was always the vision of Stagwell.

I want to stay on sort of the advocacy government side of things for just a second. A question from Jason Kreyer, Craig-Hallum. With the government shutdown still ongoing, it's going to impact my flight this evening, but that's okay. Does the government shutdown impact Stagwell's ability to penetrate the government opportunity? And so what efforts are kind of being undertaken right now to make sure that we're really well positioned maybe when the government spending comes back?

Well, we previously [indiscernible] government contract. So -- but we actually have begun to win several of those contracts. You don't see any significant effect either way because they didn't exist before, but we will want the government to reopen because it will enable the signing and moving forward of that. And I would be surprised that this lasts more than another week.

Got you. Pivoting to the Multicloud, obviously, continued strong growth within the research suite of products and things as well. You mentioned that last quarter, you mentioned it this quarter as well, the potential for a spin-off of it. Question from Barton Crockett of Rosenblatt. What kind of performance would be required for that? And what are the criteria that would need to be met for The Marketing Cloud to kind of be spun out?

Well, I think there are several. The first question is, are people looking at Stagwell as the combined services and technology company that it is, if they are, and we see the kind of trading multiples, [ so I wouldn't spin it ]. If we think that there's greater shareholder value, basically, it has to be at a sustainable level. To me, that means at least $250 million or $300 million of revenue in order to be that at substantial margin. So if we -- and for you to really see in communications, it really has 3 lines of products, communications, research and media we're targeting. So you can see that really the research is the most advanced and we're seeing real organic growth and adoption of that. And I'm expecting the other main criteria here is that the 3 legs of the stool in the marketplace, showing substantial growth so that investors will be excited about it.

I want to wrap up with one final question. And obviously, a number of management changes recently. I think you touched on a lot of what I'm about to ask within the script as well. But I think it would be great if you kind of maybe just summarize the current strategy for the business, the pivot that we've talked about, where are we right now? And as we look kind of over the course of the next 12, 18, 24 months, what's the real focus for Stagwell moving forward?

Sure. Look, the vision of Stagwell has always been to get to global full service down to platform self-service. I understand that this was an industry in transformation and to be a transformer as part of that industry. And I think what you see, particularly in this report, you see on the global full service top 25 client relationship now is now $28 million. When I came 5 years ago, we would have been lucky for that to be $500,000. We've had tremendous growth in the kinds of clients we serve and the relationships that we have because of the operations we have put together, and I think just the right Goldilocks kind of scale. And I think the second leg of that was always then to have a series of self-service and platform products that could then be sold in based on our experience and knowledge and connections with thousands of clients. It's far easier to develop software than it is to sell. We have a combination of client streams. We placed $5 billion or $6 billion of media. It may not be as big a scale others, but it gives us enough scale to really kind of, I think, understand how to apply AI technology to substantially improving it. And I think that's the shift in focus is we spent really a decade of more acquisition focus. We're now going to -- we're going to continue to do acquisitions as prudently and as makes sense. But now I think the second leg here of being focused on how we can bring AI technology best to marketing becomes a primary focus of the company.

Thank you, Mark, and thank you, Ryan. That brings to an end the call for today. Please, if you have any questions, don't hesitate to reach out to the IR team, ir@stagwellglobal.com, and we'll see you in the new year for our fourth quarter results. Thank you very much.