FIRST ADVANTAGE CORP
For the period ended Mar 31, 2026. Filed May 7, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 7, 2026
FA$23.53+1.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-06.
0001193125-25-269602
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-07.
0001193125-26-211985
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 190 previous paragraphs and 161 current paragraphs.
86 unchanged; 50 reworded; 25 added; 51 removed; 3 previous and 0 current paragraphs rearranged.
Tables are not compared: 16 previous and 16 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (25)
Current report
“Sterling” refers to Sterling Check Corp., which became an indirect, wholly owned subsidiary of First Advantage on October 31, 2024, and now operates as a separate reportable segment;
Current report
First Advantage is a global software and data company. We provide comprehensive, end-to-end identity solutions, criminal background screening, credential verifications, drug and health screening, and continuous risk monitoring. Combining AI-powered proprietary technology platforms with proprietary data, primary source data, and third-party data, we help organizations hire with confidence and manage risk across the entire employee lifecycle.
Current report
Our results continue to be influenced by our customers’ underlying business performance, hiring patterns, and workforce strategies, which collectively drive demand for our background screening and adjacent solutions. Customer demand remains sensitive to a range of macroeconomic and labor-market factors, including hiring velocity, employee turnover, sector‑specific employment trends, and overall economic conditions. During periods of economic uncertainty, employers may reduce or delay hiring, slow onboarding activity, or take a more measured approach to workforce expansion, which can negatively impact demand for our solutions.
Current report
Macroeconomic conditions during the year have continued to be volatile. While parts of the global economy have demonstrated resilience, employers continue to operate in an environment characterized by elevated interest rates, inflationary pressure driven in part by higher energy and transportation costs, and uneven hiring activity across industries and geographies. Recent geopolitical developments, including ongoing conflict in the Middle East and resulting disruptions to global energy markets, have contributed to renewed inflation concerns, higher operating costs for many businesses, and increased uncertainty in planning and investment decisions. In addition, continued uncertainty surrounding global trade and tariff policies, shifting supply‑chain strategies, and evolving regulatory and compliance requirements have contributed to cautious employer behavior, particularly among customers with international operations or exposure to cyclical end markets.
Current report
Heightened geopolitical tensions, regional conflicts, and policy uncertainty have increased variability in customer hiring plans and workforce strategies. These conditions have resulted in slower decision‑making, increased cost scrutiny, and greater focus on operational efficiency, including the pace and scale of new hiring initiatives. If the economic uncertainty is sustained or increases, we may experience a negative impact on new business generation, customer renewals and overall demand levels, sales and marketing efforts, revenues growth rates, customer deployments, customer collections, product development, or other financial metrics. Any of these factors could harm our business, financial condition, and operating results. Our ability to grow our business will also depend on the long-term strength, diversity, and durability of the verticals that we focus on and rely upon to drive our revenues.
Current report
As our business continues to expand globally, the distribution of pretax income across domestic and foreign jurisdictions may fluctuate, resulting in volatility in our effective tax rate. Additionally, the effective tax rate may also be affected by the availability of tax credits and incentives, non-deductible expenses, changes in valuation allowances, and the resolution of uncertain tax positions. These factors, individually or collectively, may cause our provision for income taxes and effective tax rate to differ materially from period to period.
Current report
a $16.7 million increase in third-party data expenses as a result of increased revenue volumes; and
Current report
a $0.9 million increase in software costs.
Current report
a $2.0 million decrease in software expenses as a result of integration efforts related to the acquisition of Sterling; and
Current report
a $0.7 million decrease in professional services costs from non-recurring integration activities incurred in the prior year.
Current report
Selling, general, and administrative expense decreased primarily due to:
Current report
a $4.6 million decrease in personnel expenses resulting from cost-savings actions implemented by the Company in 2025;
Current report
a $4.2 million decrease in share-based compensation expense, primarily due to Sterling equity awards converted to First Advantage equity awards in connection with the October 2024 acquisition becoming fully vested;
Current report
a $3.8 million decrease in bonus expense, primarily driven by lower cash compensation related to Sterling equity awards converted to cash awards in connection with the October 2024 acquisition becoming fully vested; and
Current report
decreases in other corporate expenses, primarily reflecting additional cost-savings actions taken by the Company.
Current report
These decreases were partially offset by a $5.2 million loss on the sale of assets related to an adjacent product during the three months ended March 31, 2026, which did not constitute a sale of a business or discontinued operations.
Current report
The decrease in interest expense was primarily driven by lower interest on the Company’s term loan, reflecting voluntary principal repayments and reduced interest rates following the Company’s 2025 amendment to its 2024 First Lien Credit Agreement. The decrease was further impacted by an increase in unrealized gains of $8.9 million on the Company’s interest rate swaps, driven by interest rate volatility during the period.
Current report
Adjusted Diluted Earnings Per Share was $0.26 for the three months ended March 31, 2026, compared to $0.17 for the three months ended March 31, 2025. Adjusted Diluted Earnings Per Share for the three months ended March 31, 2026 increased by $0.09, or 52.9% compared to the three months ended March 31, 2025.
Current report
Adjusted Diluted Earnings Per Share is further impacted by shares repurchased under the Company’s Repurchase Program.
Current report
In connection with the Sterling Acquisition, on October 31, 2024, the Company refinanced its existing First Lien Credit Agreement and all related Sterling debt (the “2024 First Lien Credit Agreement”). The 2024 First Lien Credit Agreement provided for a term loan of $2.185 billion due October 31, 2031, carrying an interest rate of 3.00% to 3.25%, based on the first lien ratio, plus SOFR and a $250.0 million revolving credit facility due October 31, 2029.
Current report
Share Repurchase Program
Current report
On February 25, 2026, the Company’s Board of Directors authorized the repurchase of up to $100.0 million of the Company’s common stock (the “2026 Repurchase Program”) with no expiration date. Stock repurchases may be effected through open market repurchases at prevailing market prices, including through the use of block trades and trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, privately-negotiated transactions, through other transactions in accordance with applicable securities laws, or a combination of these methods on such terms and in such amounts as the Company deems appropriate. The Company is not obligated to repurchase any specific number of shares, and the timing, manner, value, and actual number of shares repurchased will depend on a variety of factors, including the Company’s stock price and liquidity requirements, other business considerations and general market and economic conditions. No shares will be purchased from SLP Fastball Aggregator, L.P. and its affiliates. The Company may discontinue or modify purchases without notice at any time. The Company plans to use its existing cash to fund repurchases made under the 2026 Repurchase Program.
Current report
Net cash used in financing activities was $44.3 million for the three months ended March 31, 2026, compared to $6.0 million for the three months ended March 31, 2025. Net cash used in financing activities for the three months ended March 31, 2026 was primarily driven by principal repayments of $25.0 million on the Company’s term loan and shares repurchased under the Company’s Repurchase Program. During the three months ended March 31, 2026, 1,734,778 shares were repurchased under the Repurchase Program at a total cost of $19.5 million.
Current report
Contractual Obligations, Commitments, and Other Contingencies
Current report
Recent Accounting Pronouncements
Removed paragraphs (51)
Previous report
First Advantage is a leading provider of global software and data in the HR technology industry. Enabled by its proprietary technology and AI, First Advantage’s platforms, data, and APIs power comprehensive employment background screening, digital identity solutions, and verification services.
Previous report
Our comprehensive product suite includes criminal background checks, drug and health screening, extended workforce screening, biometrics and identity, education and work verifications, resident screening, fleet and driver compliance, executive screening, data analytics, continuous monitoring, social media monitoring, and hiring tax incentives.
Previous report
On October 31, 2024, we completed our acquisition of Sterling, a global provider of technology-enabled background and identity verification services. This strategic acquisition enhances our capabilities and expands our service offerings, allowing us to deliver a comprehensive hiring and risk management solution that begins with identity verification and extends through criminal background screening, credential verification, drug and health screening, and ongoing risk monitoring.
Previous report
Our results are influenced by our customers’ underlying business performance and hiring trends, which drive demand for background screening and adjacent products. Our customers’ businesses can be affected by a variety of factors, including overall economic conditions, hiring velocity and turnover, and other industry-related trends. We are also exposed to macroeconomic cyclicality, as companies often scale back hiring and reduce reliance on contingent workforces during periods of economic slowdown, which can adversely affect demand for our products and solutions.
Previous report
Current macroeconomic conditions—including elevated interest rates, persistent inflation, and fluctuations in job openings and hiring activity—continue to impact portions of the global economy. Geopolitical tensions—including ongoing conflicts in Ukraine and the Middle East—and recent trade policy actions, such as newly imposed tariffs between the U.S. and China, have further disrupted global supply chains and heightened market volatility. These factors have led to increased operating costs and reduced business confidence for companies, particularly in globally exposed sectors.
Previous report
If this economic uncertainty continues or worsens, we may face pressure on new business generation, customer renewals, overall demand levels, sales and marketing effectiveness, revenue growth, customer onboarding, collection cycles, and product development initiatives. Our ability to sustain growth will also depend on the long-term stability, diversity, and resilience of the industry verticals we serve and rely upon to drive our revenues.
Previous report
On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted into law in the United States, introducing substantial changes to the U.S. Corporate tax regime. Key provisions of the OBBBA include the reinstatement of 100% bonus depreciation, restoration of immediate expensing for domestic research or experimental (“R&E”) expenditures, an elective acceleration of deduction for unamortized domestic R&E expenditures, revised limitations on the deductibility of business interest expense, and modifications to the Global Intangible Low-Tax Income (“GILTI”) and Foreign-Derived Intangible Income (“FDII”) regimes. The OBBBA includes multiple effective dates, with certain provisions effective for tax years beginning after December 31, 2024 and others phased in through 2027. In accordance with ASC 740, Income Taxes, the Company has reflected the impacts of OBBBA in the interim period that includes the enactment date. The resulting effects have been incorporated into the Company’s income tax provision for the nine months ended September 30, 2025, including adjustments to deferred tax assets and liabilities where applicable. The Company continues to evaluate the broader implications of the OBBBA, including potential impacts on future taxable income, the estimated annual effective tax rate, and potential effects of future regulatory guidance issued by the Internal Revenue Service or other relevant tax authorities. Additional impacts, if any, will be recognized in subsequent periods as appropriate.
Previous report
Additionally, on October 1, 2025, the U.S. federal government entered a partial shutdown, resulting in widespread furloughs and delays in the release of key economic data. If prolonged, the shutdown may contribute to increased economic uncertainty, potentially affecting customer demand, hiring activity, regulatory timelines, and overall business sentiment. We continue to monitor the situation and assess any potential impacts on our operations and financial performance.
Previous report
revenues of $199.4 million, or 100.1%, attributable to Sterling as a result of the Sterling Acquisition completed on October 31, 2024;
Previous report
Revenues were $1,154.4 million for the nine months ended September 30, 2025, compared to $553.1 million for the nine months ended September 30, 2024. Revenues for the nine months ended September 30, 2025 increased by $601.3 million, or 108.7%, compared to the nine months ended September 30, 2024.
Previous report
revenues of $590.6 million, or 106.8%, attributable to Sterling as a result of the Sterling Acquisition completed on October 31, 2024; and
Previous report
These revenue increases were offset by a net decrease of $5.0 million, or 0.9%, in revenues from existing customers, primarily due to macroeconomic pressures across a number of our customer verticals that led to reduced overall existing customer demand, as well as the impact of lost customers. These decreases in existing customer revenues were partially mitigated by continued strength from upselling and cross-selling initiatives, which contributed an additional $27.0 million, or 4.9%, in revenue growth.
Previous report
Cost of services was $622.4 million for the nine months ended September 30, 2025, compared to $280.4 million for the nine months ended September 30, 2024. Cost of services for the nine months ended September 30, 2025 increased by $342.0 million, or 122.0%, compared to the nine months ended September 30, 2024.
Previous report
The increase in cost of services was primarily due to $332.0 million of Sterling costs of services recognized after the Sterling Acquisition.
Previous report
Cost of services as a percentage of revenues was 53.9% for the nine months ended September 30, 2025, compared to 50.7% for the nine months ended September 30, 2024. The cost of services percentage of revenues for the third quarter of 2025 was impacted by Sterling’s higher relative cost of services due to the segment’s product and customer mix and other variations in customer ordering mix.
Previous report
$5.3 million of Sterling personnel expenses recognized after the Sterling Acquisition
Previous report
$3.5 million increase in Legacy First Advantage personnel expenses as a result of additional investments made to enhance our products, solutions, and technology platforms; and
Previous report
$3.2 million increase in professional service fees related to continued investments in our technology platforms.
Previous report
Product and technology expense was $78.0 million for the nine months ended September 30, 2025, compared to $39.1 million for the nine months ended September 30, 2024. Product and technology expense for the nine months ended September 30, 2025 increased by $38.9 million, or 99.6%, compared to the nine months ended September 30, 2024.
Previous report
$19.8 million of Sterling personnel expenses recognized after the Sterling Acquisition, of which approximately $1.2 million related to cash compensation expense due to the conversion of Sterling equity awards to cash awards as part of the transaction;
Previous report
$9.4 million increase in professional service fees related to continued investments in our technology platforms; and
Previous report
$7.7 million increase in Legacy First Advantage personnel expenses as a result of additional investments made to enhance our products, solutions, and technology platforms.
Previous report
Selling, general, and administrative expense increased primarily due to $25.6 million of Sterling expenses recognized after the Sterling Acquisition, which include:
Previous report
$12.1 million of personnel expenses recognized after the Sterling Acquisition;
Previous report
$1.2 million increase in bad debt expense as certain groups of customers have experienced longer than normal payment cycles;
Previous report
$0.9 million related to share-based compensation expense due to the conversion of Sterling equity awards to First Advantage equity awards as part of the transaction; and
Previous report
$0.8 million related to cash compensation expense due to the conversion of Sterling equity awards to cash awards as part of the transaction.
Previous report
These increases in selling, general, and administrative expense were partially offset by a $12.2 million decrease in transaction costs attributable to the Sterling Acquisition related to professional service, legal, and other fees, that did not reoccur as the acquisition was completed on October 31, 2024.
Previous report
Selling, general, and administrative expense was $180.5 million for the nine months ended September 30, 2025, compared to $125.4 million for the nine months ended September 30, 2024. Selling, general, and administrative expense for the nine months ended September 30, 2025 increased by $55.2 million, or 44.0%, compared to the nine months ended September 30, 2024.
Previous report
Selling, general, and administrative expense increased primarily due to $87.4 million of Sterling expenses recognized after the Sterling Acquisition, which include:
Previous report
$43.8 million of personnel expenses recognized after the Sterling Acquisition;
Previous report
$5.2 million related to share-based compensation expense due to the conversion of Sterling equity awards to First Advantage equity awards as part of the transaction; and
Previous report
$4.8 million related to cash compensation expense due to the conversion of Sterling equity awards to cash awards as part of the transaction.
Previous report
These increases in selling, general, and administrative expense were partially offset by a $29.1 million decrease in transaction costs attributable to the Sterling Acquisition related to professional service, legal, and other fees, that did not reoccur as the acquisition was completed on October 31, 2024.
Previous report
Depreciation and amortization was $185.8 million for the nine months ended September 30, 2025, compared to $90.0 million for the nine months ended September 30, 2024. Depreciation and amortization for the nine months ended September 30, 2025 increased by $95.9 million, or 106.6%, compared to the nine months ended September 30, 2024. This increase was primarily due to the impact of the step up in fair value of property and equipment and intangible assets as a result of the application of purchase accounting related to the Sterling Acquisition.
Previous report
The increase in interest expense was primarily driven by higher borrowings under the term loan facility, which included an incremental principal amount of $1,620.3 million and an expanded revolver commitment of $150.0 million in connection with the Sterling Acquisition. Interest expense, net was further impacted by unrealized gains on the Company’s interest rate swaps.
Previous report
Interest expense, net was $131.4 million for the nine months ended September 30, 2025, compared to $28.1 million for the nine months ended September 30, 2024. Interest expense, net for the nine months ended September 30, 2025 increased by $103.3 million or 367.4%, compared to the nine months ended September 30, 2024.
Previous report
The increase in interest expense was primarily driven by higher borrowings under the term loan facility, which included an incremental principal amount of $1,620.3 million and an expanded revolver commitment of $150.0 million in connection with the Sterling Acquisition. Interest expense, net was further impacted by $5.6 million of unrealized losses on the Company’s interest rate swaps, reflecting heightened interest rate volatility during the period.
Previous report
Our (benefit) provision for income taxes was $(6.2) million for the nine months ended September 30, 2025, compared to $0.1 million for the nine months ended September 30, 2024. Our provision for income taxes for the nine months ended September 30, 2025 decreased by $6.3 million, compared to the nine months ended September 30, 2024.
Previous report
The decrease in our provision for income taxes was primarily due to the increase of net book loss before income taxes, jurisdictional mix of earnings, higher income taxes in the jurisdictions outside of the U.S., and U.S. state income taxes, during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024.
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Reworded paragraphs (50)
Previous wording
The following discussion and analysis of First Advantage Corporation’s financial condition and results of operations is provided as a supplement to the condensed consolidated financial statements for the three and nine months ended September 30, 2025, and should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2024, our “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. All discussions and information in this Quarterly Report on Form 10-Q regarding our business and financial results in 2024 relate solely to our operations prior to the acquisition of Sterling Check Corp. (“Sterling” and such acquisition, the “Sterling Acquisition”), unless otherwise indicated.
Current wording
The following discussion and analysis of First Advantage Corporation’s financial condition and results of operations is provided as a supplement to the condensed consolidated financial statements for the three months ended March 31, 2026, and should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2025, our “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
Previous wording
These forward-looking statements are subject to various risks, uncertainties, assumptions, or changes in circumstances that are difficult to predict or quantify. Such risks and uncertainties include, but are not limited to, the following: the failure to realize the expected benefits of the Sterling Acquisition; negative changes in external events beyond our control, including our customers’ onboarding volumes, economic drivers which are sensitive to macroeconomic cycles, such as interest rate volatility and inflation, geopolitical unrest, global trade disputes, uncertainty in financial markets, and changes in tax laws; our operations in a highly regulated industry and the fact that we are subject to numerous and evolving laws and regulations, including with respect to personal data, data security, and artificial intelligence (“AI”); inability to identify and successfully implement our growth strategies on a timely basis or at all; potential harm to our business, brand, and reputation as a result of security breaches, cyber-attacks, or the mishandling of personal data; operating in a penetrated and competitive market; our reliance on third-party data providers; our sales to government entities and higher-tier contractors to governmental customers which involve unique competitive, procurement, budget, administrative and contractual risks; due to the sensitive and privacy-driven nature of our products and solutions, we could face liability and legal or regulatory proceedings, which could be costly and time-consuming to defend and may not be fully covered by insurance; our international business exposes us to a number of risks; real or perceived errors, failures, or bugs in our products could adversely affect our business, results of operations, financial condition, and growth prospects; our ability to identify attractive targets or successfully complete such transactions; failure to comply with anti-corruption laws and regulations; disruptions at our Global Operating Center and other operating centers; our contracts with our customers, which do not guarantee exclusivity or contracted volumes; disruptions, outages, or other errors with our technology and network infrastructure, including our data centers, servers, and third-party cloud and internet providers and our migration to the cloud; the continued integration of our platforms and solutions with human resource providers such as applicant tracking systems and human capital management systems as well as our relationships with such human resource providers; risks relating to public opinion, which may be magnified by incidents or adverse publicity concerning our industry or operations; our reliance on third-party vendors to carry out certain portions of our operations; our dependence on the service of our key executives and other employees, and our ability to find and retain qualified employees; our ability to obtain, maintain, protect and enforce our intellectual property and other proprietary info…
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Current wording
These forward-looking statements are subject to various risks, uncertainties, assumptions, or changes in circumstances that are difficult to predict or quantify. Such risks and uncertainties include, but are not limited to, the following: the failure to realize the expected benefits of the Sterling Acquisition; adverse changes in external events beyond our control, including our customers’ onboarding volumes, economic drivers which are sensitive to macroeconomic cycles, such as interest rate volatility and inflation, geopolitical unrest, global trade disputes, uncertainty in financial markets, and changes in tax laws; our operations in a highly regulated industry and the fact that we are subject to numerous and evolving laws and regulations, including with respect to personal data, data security, and artificial intelligence (“AI”); our inability to identify and successfully implement our growth strategies on a timely basis or at all; potential harm to our business, brand, and reputation as a result of security breaches, cyber-attacks, social, ethical, and legal issues relating to the use of new and evolving technologies, employee or other internal misconduct, computer viruses, or the mishandling of personal data; operating in a penetrated and competitive market; our reliance on third-party data providers; our sales to government entities and higher-tier contractors to governmental customers which involve unique competitive, procurement, budget, administrative and contractual risks; due to the sensitive and privacy-driven nature of our products and solutions, we could face liability and legal or regulatory proceedings, which could be costly and time-consuming to defend and may not be fully covered by insurance; our international business exposes us to a number of risks; real or perceived errors, failures, or bugs in our products could adversely affect our business, results of operations, financial condition, and growth prospects; our ability to identify attractive targets or successfully complete such transactions; failure to comply with anti-corruption, economic and trade sanctions, and anti-money laundering laws and regulations; disruptions at our Operation Centers of Excellence and other operational sites; our contracts with our customers, which do not guarantee exclusivity or contracted volumes; the timing, manner and volume of repurchases of common stock pursuant to our share repurchase program; disruptions, outages, or other errors with our technology and network infrastructure, including our data centers, servers, and third-party cloud and internet providers and our migration to the cloud; the continued integration of our platforms and solutions with human resource providers such as applicant tracking systems and human capital management systems as well as our relationships with such human resource providers; risks relating to public opinion, which may be magnified by incidents or adverse publicity concerning our industry or operations; our…
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Previous wording
Together, we derive a substantial majority of our revenues from pre-onboarding screening and perform services across over 200 countries and territories, enabling us to serve as a one-stop-shop provider to both multinational companies and growth companies. Our 80,000 customers are global enterprises, mid-sized companies, and small companies, and our products and solutions are used by personnel in recruiting, human resources, risk, compliance, vendor management, safety, and/or security.
Current wording
We derive a substantial majority of our revenues from pre-onboarding screening and perform screens across over 200 countries and territories, enabling us to serve as a one-stop-shop provider to both multinational companies and growth companies. Our over 80,000 customers are global enterprises, mid-sized companies, and small companies, and our products and solutions are used by personnel in Executive Management, Human Resources, Talent Acquisition, Compliance, Risk, Legal, Safety, and Vendor Management.
Previous wording
We generated revenues of $409.2 million for the three months ended September 30, 2025, as compared to $199.1 million for the three months ended September 30, 2024 and generated revenues of $1,154.4 million for the nine months ended September 30, 2025, as compared to $553.1 million for the nine months ended September 30, 2024. Approximately 86% of our revenues for the nine months ended September 30, 2025 was generated in the United States, while the remaining 14% was generated abroad. Other than the United States, no single country accounted for 10% or more of our total revenues for the three and nine months ended September 30, 2025. Please refer to “Results of Operations” for further details.
Current wording
We generated revenues of $385.2 million for the three months ended March 31, 2026, as compared to $354.6 million for the three months ended March 31, 2025. Approximately 86% of our revenues for the three months ended March 31, 2026 was generated in the United States, while the remaining 14% was generated abroad. Other than the United States, no single country accounted for 10% or more of our total revenues for the three months ended March 31, 2026. Please refer to “Results of Operations” for further details.
Previous wording
First Advantage Americas. This segment pertains to our Legacy First Advantage business and performs a variety of background check and compliance services across all phases of the workforce lifecycle from pre-onboarding services to post-onboarding and ongoing monitoring services, covering employees, contractors, contingent workers, tenants, and drivers. We generally classify our service offerings into three categories: pre-onboarding, post-onboarding, and adjacent products. We deliver our solutions across multiple industry verticals in the United States, Canada, and Latin America.
Current wording
First Advantage Americas. This segment pertains to our Legacy First Advantage business and performs a variety of background check and compliance services across all phases of the workforce lifecycle from pre-onboarding services to post-onboarding and ongoing monitoring services, covering employees, contractors, contingent workers, and drivers. We generally classify our service offerings into three categories: pre-onboarding, post-onboarding, and adjacent products. We deliver our solutions across multiple industry verticals in the United States, Canada, and Latin America.
Previous wording
We experience seasonality with respect to certain industries as a result of fluctuations in hiring volumes and other economic activities. For example, pre-onboarding revenues generated from our customers in the retail and transportation industries are historically highest during the months of October and November, leading up to the U.S. holiday season and lowest in December and at the beginning of the new year, following the U.S. holiday hiring season. Certain customers across various industries also historically increase their hiring throughout the second quarter of the year as winter concludes, and the school year ends, giving rise to student and graduate hiring, and increased commercial activity tied to outdoor activities. We anticipate that evolving consumer trends, labor market dynamics, technological advancements, and broader macroeconomic conditions may impact future seasonality, but we are unable to predict these potential shifts and how our business may be impacted.
Current wording
We experience seasonality with respect to certain industries due to fluctuations in hiring volumes and other economic activity. For example, pre-onboarding revenues generated from our customers in the retail and transportation industries are historically highest during the months of October and November, leading up to the U.S. holiday season and lowest in December and at the beginning of the new year, following the U.S. holiday hiring season. Certain customers across various industries also historically increase their hiring throughout the second quarter of the year as winter concludes, and the school year ends, giving rise to student and graduate hiring, and increased commercial activity tied to outdoor activities. We expect that changes in consumer behavior, labor market conditions, technological innovation, and broader macroeconomic factors may impact future seasonality, but we are unable to predict these potential shifts and their impact to our business.
Previous wording
Despite these macroeconomic changes, we are confident in the overall long-term health of our business, the strength of our product offerings, and our ability to continue to execute on our strategy and help our customers hire smarter and onboard faster. Our continued focus on delivering innovative solutions that enhance workplace safety and address evolving compliance requirements as well as our diversified customer base have contributed to the stability of our business and long-term financial performance.
Current wording
Despite these macroeconomic changes, we are confident in the overall long-term health of our business, the strength of our product offerings, and our ability to continue to execute on our strategy and help our customers hire with confidence and manage risk across the entire employee lifecycle. Our continued focus on delivering innovative solutions that enhance workplace safety and address evolving compliance requirements as well as our diversified customer base have contributed to the stability of our business and long-term financial performance.
Previous wording
The Company derives revenues from a variety of background screening and adjacent products performed across all phases of the workforce lifecycle from pre-onboarding screening services to post-onboarding and ongoing monitoring services, covering employees, contractors, contingent workers, tenants, and drivers. We generally classify our products and solutions into three major categories: pre-onboarding, post-onboarding, and adjacent products, each of which is enabled by our technologies, proprietary internal databases, and data analytics capabilities. Pre-onboarding products, which comprise the substantial majority of our revenues, span an extensive array of products that customers typically utilize to enhance their candidate evaluation process and support compliance with their workforce onboarding criteria from the time an application is submitted to a candidate’s successful onboarding. Post-onboarding products are comprised of continuous monitoring, re-screening, and other solutions to help our customers keep their end customers, workforces, and other stakeholders safer, more productive, and more compliant. Adjacent products include products that complement our pre-onboarding and post-onboarding solutions such as fleet and vehicle compliance, hiring tax credits and incentives, resident and tenant screening, employment eligibility, and investigative research.
Current wording
The Company derives revenues from a variety of background screening and adjacent products performed across all phases of the workforce lifecycle from pre-onboarding screening services to post-onboarding and ongoing monitoring services, covering employees, contractors, contingent workers, and drivers. We generally classify our products and solutions into three major categories: pre-onboarding, post-onboarding, and adjacent products, each of which is enabled by our technologies, proprietary internal databases, and data analytics capabilities. Pre-onboarding products, which comprise the substantial majority of our revenues, span an extensive array of products that customers typically utilize to enhance their applicant evaluation process and support compliance with their workforce onboarding criteria from the time an application is submitted to an applicant’s successful onboarding. Post-onboarding products are comprised of continuous monitoring, re-screening, and other solutions to help our customers keep their end customers, workforces, and other stakeholders safer, more productive, and more compliant. Adjacent products include products that complement our pre-onboarding and post-onboarding solutions such as fleet and vehicle compliance, hiring tax credits and incentives, employment eligibility, and investigative research.
Previous wording
Selling, General, and Administrative Expense: Consists of sales, customer success, marketing, and general and administrative expenses. Sales, customer success, and marketing expenses consist primarily of employee compensation such as salaries, bonuses, sales commissions, share-based compensation, and other employee benefits for our verticalized sales and customer success teams. General and administrative expenses include travel expenses and various corporate functions including finance, human resources, legal, and other administrative roles, in addition to certain professional service fees and expenses incurred in connection with the Sterling Acquisition. We do not allocate depreciation and amortization to selling, general, and administrative expenses.
Current wording
Selling, General, and Administrative Expense: Consists of sales, customer success, marketing, and general and administrative expenses. Sales, customer success, and marketing expenses consist primarily of employee compensation such as salaries, bonuses, sales commissions, share-based compensation, and other employee benefits for our verticalized sales and customer success teams. General and administrative expenses include travel expenses and various corporate functions including finance, human resources, legal, and other administrative roles, in addition to certain professional service fees and expenses incurred in connection with acquisitions. Selling, general, and administrative expenses also include gains and losses from the sale of assets that do not constitute a sale of a business or discontinued operations. We do not allocate depreciation and amortization to selling, general, and administrative expenses.
Previous wording
We have a flexible cost structure that allows our business to adjust quickly to the impacts of macroeconomic events and scale to meet the needs of large customers. Operating expenses are influenced by the amount of revenues, customer mix, and product mix that contribute to our revenues for any given period, as well as the progress of our integration of Sterling. As revenues grow, we would generally expect cost of services to grow in a similar fashion, albeit influenced by the effects of automation, productivity, and other efficiency initiatives as well as customer and product mix shifts and third-party pass-through costs. We regularly review expenses and investments in the context of revenue growth and any shifts we identify in the business in order to align with our overall financial objectives. While we expect operating expenses to increase in absolute dollars to support our continued growth, we believe that, in the long term, operating expenses as a percentage of total revenues will decline gradually in the future as our business grows and our operating efficiency and automation initiatives continue to advance.
Current wording
We have a flexible cost structure that allows our business to adjust quickly to the impacts of macroeconomic events and scale to meet the needs of large customers. Operating expenses are influenced by revenue levels, customer and product mix, and the progress of acquisition-related integration activities. As revenues grow, we would generally expect cost of services to grow proportionally, although the rate of growth may vary based on automation, productivity initiatives, efficiency gains, shifts in mix, and third‑party pass‑through costs. We regularly review expenses and investments in the context of revenue trends and observed changes in the business to ensure alignment with our financial objectives. While we expect operating expenses to increase in absolute dollars as we support continued growth, we believe that, over the long term, operating expenses as a percentage of total revenues will gradually decline as we scale the business and advance our operating efficiency and automation initiatives.
Previous wording
Provision for income taxes consists of domestic and foreign corporate income taxes related to earnings from our sale of products and services, with statutory tax rates that differ by jurisdiction. Our effective tax rate may be affected by various factors including changes in tax laws, regulations, credits or rates, new interpretations of existing laws or regulations, shifts in the allocation of income earned throughout the world, and changes in overall levels of income before tax.
Current wording
Provision for income taxes consists of U.S. domestic and foreign corporate income taxes related to earnings, with applicable statutory tax rates varying by jurisdiction. Our effective tax rate may be affected by a number of factors, including changes in tax laws, regulations, or statutory rates; regulatory guidance, or new administrative interpretations of judicial decisions; and shifts in proportion of income earned in jurisdictions with differing statutory tax rates.
Previous wording
Comparison of Results of Operations for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024
Current wording
Comparison of Results of Operations for the three months ended March 31, 2026 compared to the three months ended March 31, 2025
Previous wording
Revenues were $409.2 million for the three months ended September 30, 2025, compared to $199.1 million for the three months ended September 30, 2024. Revenues for the three months ended September 30, 2025 increased by $210.0 million, or 105.5%, compared to the three months ended September 30, 2024.
Current wording
Revenues were $385.2 million for the three months ended March 31, 2026, compared to $354.6 million for the three months ended March 31, 2025. Revenues for the three months ended March 31, 2026 increased by $30.6 million, or 8.6%, compared to the three months ended March 31, 2025.
Previous wording
revenues of $3.6 million, or 1.8% from existing customers, primarily driven by continued strength from upselling and cross-selling initiatives. These increases were partially offset by declines in existing customer revenues across several verticals, largely due to macroeconomic pressures that contributed to reduced demand and the impact of lost customers.
Current wording
a net increase of $15.4 million, or 4.4% from existing customer revenues, primarily driven by continued strength from upselling and cross-selling initiatives which were offset by the impact of of lost accounts; and
Previous wording
revenues of $7.0 million, or 3.5%, from new customers, primarily attributable to our First Advantage Americas segment; and
Current wording
revenues of $15.2 million, or 4.3%, from new customers, primarily attributable to our First Advantage Americas and Sterling segments.
Previous wording
Cost of services was $222.0 million for the three months ended September 30, 2025, compared to $100.9 million for the three months ended September 30, 2024. Cost of services for the three months ended September 30, 2025 increased by $121.2 million, or 120.1%, compared to the three months ended September 30, 2024.
Current wording
Cost of services was $211.4 million for the three months ended March 31, 2026, compared to $192.6 million for the three months ended March 31, 2025. Cost of services for the three months ended March 31, 2026 increased by $18.8 million, or 9.8%, compared to the three months ended March 31, 2025.
Previous wording
The increase in cost of services was primarily due to $113.1 million of Sterling costs of services recognized after the Sterling Acquisition.
Current wording
The increase in cost of services was primarily due to:
Previous wording
Cost of services as a percentage of revenues was 54.3% for the three months ended September 30, 2025, compared to 50.7% for the three months ended September 30, 2024. The cost of services percentage of revenues for the third quarter of 2025 was impacted by Sterling’s higher relative cost of services due to the segment’s product and customer mix and other variations in customer ordering mix.
Current wording
Cost of services as a percentage of revenues was 54.9% for the three months ended March 31, 2026, compared to 54.3% for the three months ended March 31, 2025. The cost of services percentage of revenues for the first quarter of 2026 was impacted by product and customer mix and increases in third party costs.
Previous wording
Product and technology expense was $25.1 million for the three months ended September 30, 2025, compared to $12.9 million for the three months ended September 30, 2024. Product and technology expense for the three months ended September 30, 2025 increased by $12.2 million, or 94.7%, compared to the three months ended September 30, 2024.
Current wording
Product and technology expense was $24.6 million for the three months ended March 31, 2026, compared to $27.2 million for the three months ended March 31, 2025. Product and technology expense for the three months ended March 31, 2026 decreased by $2.6 million, or 9.4%, compared to the three months ended March 31, 2025.
Previous wording
The increase in product and technology expense was primarily due to:
Current wording
The decrease in product and technology expense was primarily due to:
Previous wording
Selling, general, and administrative expense was $57.5 million for the three months ended September 30, 2025, compared to $46.1 million for the three months ended September 30, 2024. Selling, general, and administrative expense for the three months ended September 30, 2025 increased by $11.4 million, or 24.8%, compared to the three months ended September 30, 2024.
Current wording
Selling, general, and administrative expense was $53.5 million for the three months ended March 31, 2026, compared to $65.6 million for the three months ended March 31, 2025. Selling, general, and administrative expense for the three months ended March 31, 2026 decreased by $12.1 million, or 18.5%, compared to the three months ended March 31, 2025.
Previous wording
Depreciation and amortization was $62.3 million for the three months ended September 30, 2025, compared to $30.2 million for the three months ended September 30, 2024. Depreciation and amortization for the three months ended September 30, 2025 increased by $32.1 million, or 106.4%, compared to the three months ended September 30, 2024. This increase was primarily due to the impact of the step up in fair value of property and equipment and intangible assets as a result of the application of purchase accounting related to the Sterling Acquisition.
Current wording
Depreciation and amortization was $62.2 million for the three months ended March 31, 2026, compared to $61.7 million for the three months ended March 31, 2025. Depreciation and amortization for the three months ended March 31, 2026 increased by $0.5 million, or 0.8%, compared to the three months ended March 31, 2025 primarily due to assets placed in service since March 31, 2025.
Previous wording
Interest expense, net was $40.0 million for the three months ended September 30, 2025, compared to $17.2 million for the three months ended September 30, 2024. Interest expense, net for the three months ended September 30, 2025 increased by $22.9 million or 132.9%, compared to the three months ended September 30, 2024.
Current wording
Interest expense, net was $29.8 million for the three months ended March 31, 2026, compared to $46.6 million for the three months ended March 31, 2025. Interest expense, net for the three months ended March 31, 2026 decreased by $16.7 million or 35.9%, compared to the three months ended March 31, 2025.
Previous wording
Loss on extinguishment of debt for the three and nine months ended September 30, 2025, relates to the write-off of unamortized deferred financing costs as a result of voluntary principal repayments of $40.0 million on the Company’s outstanding term loan facility.
Current wording
Loss on extinguishment of debt for the three months ended March 31, 2026 relates to the write-off of unamortized deferred financing costs as a result of voluntary principal repayments of $25.0 million on the Company’s outstanding term loan facility.
Previous wording
Our (benefit) provision for income taxes was $(0.8) million for the three months ended September 30, 2025, compared to $0.8 million for the three months ended September 30, 2024. Our provision for income taxes for the three months ended September 30, 2025 decreased by $1.6 million, compared to the three months ended September 30, 2024.
Current wording
Our provision for income taxes was $1.1 million for the three months ended March 31, 2026, compared to $2.2 million for the three months ended March 31, 2025. Our provision for income taxes for the three months ended March 31, 2026 decreased by $1.1 million, compared to the three months ended March 31, 2025.
Previous wording
The decrease in our provision for income taxes was primarily due to the jurisdictional mix of earnings, higher income taxes in the jurisdictions outside of the U.S., and U.S. state income taxes, during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024.
Current wording
The decrease in our provision for income taxes was primarily due to the jurisdictional mix of earnings and lower non-deductible share-based compensation during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025.
Previous wording
Net income (loss) was $2.6 million for the three months ended September 30, 2025, compared to $(8.9) million for the three months ended September 30, 2024. Net income for the three months ended September 30, 2025 increased by $11.5 million compared to the three months ended September 30, 2024.
Current wording
Net income (loss) was $2.2 million for the three months ended March 31, 2026, compared to $(41.2) million for the three months ended March 31, 2025. Net income for the three months ended March 31, 2026 increased by $43.4 million compared to the three months ended March 31, 2025.
Previous wording
Net income (loss) margin was 0.6% for the three months ended September 30, 2025, compared to (4.4)% for the three months ended September 30, 2024. The improvement in our net income margin is attributable to our ability to leverage operational efficiencies to control overall expenses, while increasing revenues. These improvements were offset by increases in depreciation and amortization and interest costs, primarily as a result of the Sterling Acquisition.
Current wording
Net income (loss) margin was 0.6% for the three months ended March 31, 2026, compared to (11.6)% for the three months ended March 31, 2025. The improvement in our net income margin was primarily attributable to increased revenues, our ability to leverage operational efficiencies to control overall expenses, and lower interest expense.
Previous wording
Adjusted EBITDA was $118.5 million for the three months ended September 30, 2025 and represented an Adjusted EBITDA Margin of 29.0%. Adjusted EBITDA was $64.0 million for the three months ended September 30, 2024 and represented an Adjusted EBITDA Margin of 32.2%. Adjusted EBITDA for the three months ended September 30, 2025 increased by $54.5 million, or 85.0%, compared to the three months ended September 30, 2024, primarily due to the Sterling Acquisition and related synergies.
Current wording
Adjusted EBITDA was $105.3 million for the three months ended March 31, 2026 and represented an Adjusted EBITDA Margin of 27.3%. Adjusted EBITDA was $92.1 million for the three months ended March 31, 2025 and represented an Adjusted EBITDA Margin of 26.0%. Adjusted EBITDA for the three months ended March 31, 2026 increased by $13.2 million, or 14.3%, compared to the three months ended March 31, 2025. Growth in Adjusted EBITDA was driven primarily from revenues growth attributed to new and existing customers and margin expansion attributed to cost efficiencies.
Previous wording
Share-based compensation for the three and nine months ended September 30, 2025 includes approximately $1.9 million and $5.6 million, respectively, of incrementally recognized expense associated with the May 2023 modification of the vesting terms of outstanding unvested and unearned performance-based options, restricted stock units, and restricted stock awards. The three and nine months ended September 30, 2024 includes approximately $6.6 million and $11.7 million, respectively, of incrementally recognized expense associated with the May 2023 vesting modification and retirements of the Company's former Chief Financial Officer and President, Americas.
Current wording
Share-based compensation for the three months ended March 31, 2026 and 2025 includes approximately $0.6 million and $1.9 million, respectively, of incrementally recognized expense associated with the May 2023 modification of the vesting terms of outstanding unvested and unearned performance-based options, restricted stock units, and restricted stock awards.
Previous wording
Represents charges incurred related to acquisitions and similar transactions, primarily consisting of change in control-related costs, professional service fees, and other third-party costs. Transaction and acquisition related charges for the three and nine months ended September 30, 2025 include approximately $1.4 million and $7.5 million of expense, respectively, associated with the Sterling Acquisition. The three and nine months ended September 30, 2024 include approximately $13.2 million and $33.5 million of expense, respectively, associated with the Sterling Acquisition, primarily consisting of legal, regulatory, and diligence professional service fees. The three and nine months ended September 30, 2024 also include insurance costs incurred related to the Company's initial public offering.
Current wording
Represents charges incurred related to acquisitions and similar transactions, primarily consisting of change in control-related costs, professional service fees, and other third-party costs. Transaction and acquisition related charges for the three months ended March 31, 2026 and 2025 include approximately $0.2 million and $3.8 million, respectively, of expense associated with the Sterling Acquisition.
Previous wording
Represents charges from organizational restructuring and integration activities, non-cash, and other charges primarily related to nonrecurring legal exposures, foreign currency (gains) losses, impairment of capitalized software, (gains) losses on the sale of assets, and other non-recurring items. Integration, restructuring, and other charges for the three and nine months ended September 30, 2025 include approximately $3.8 million and $15.4 million of expense, respectively, associated with the integration of Sterling. The three and nine months ended September 30, 2025 also include approximately $1.5 million of expenses related to debt refinancing activities, as well as capitalized software impairment charges of approximately $1.2 million.
Current wording
Represents charges from organizational restructuring and integration activities, non-cash, and other charges primarily related to nonrecurring legal exposures, foreign currency (gains) losses, (gains) losses on the sale of assets, and other non-recurring items. Integration, restructuring, and other charges for the three months ended March 31, 2026 and 2025 include approximately $1.4 million and $7.8 million, respectively, of expense associated with the integration of Sterling.
Previous wording
Adjusted Net Income was $52.3 million for the three months ended September 30, 2025, compared to $38.0 million for the three months ended September 30, 2024. Adjusted Net Income for the three months ended September 30, 2025 increased by $14.3 million, or 37.7% compared to the three months ended September 30, 2024, primarily due to the Sterling Acquisition. This increase was offset by fluctuations in interest expense resulting from changes in our capital structure.
Current wording
Adjusted Net Income was $45.1 million for the three months ended March 31, 2026, compared to $30.5 million for the three months ended March 31, 2025. Adjusted Net Income for the three months ended March 31, 2026 increased by $14.6 million, or 48.0% compared to the three months ended March 31, 2025.
Previous wording
Gains or losses and actual cash payments and receipts on the Company’s interest rate swaps impact the comparability of Adjusted Net Income and Adjusted Diluted Earnings Per Share across historical periods.
Current wording
This growth was driven primarily by the same factors contributing to Adjusted EBITDA growth, though Adjusted Net Income and Adjusted Diluted Earnings Per Share are also impacted by changes in acquisition-related depreciation and amortization and changes in our capital structure that are captured in interest expense. The 2025 refinancing of the Company’s 2024 First Lien Credit Agreement, voluntary debt prepayments, and gains or losses on the Company’s interest rate swaps impact the comparability of Adjusted Net Income and Adjusted Diluted Earnings Per Share across historical periods.
Previous wording
Represents the loss on extinguishment and non-cash interest expense related to the amortization of debt issuance costs. This adjustment also includes the impact of the change in fair value of interest rate swaps, which represents the difference between the fair value gains or losses and actual cash payments and receipts on the interest rate swaps.
Current wording
Represents the loss on extinguishment and non-cash interest expense related to the amortization of debt issuance costs related to the refinancing of the Company’s First Lien Credit Facility. This adjustment also includes the impact of the change in fair value of interest rate swaps, which represents the difference between the fair value gains or losses and actual cash payments and receipts on the interest rate swaps.
Previous wording
Share-based compensation for the three and nine months ended September 30, 2025 includes approximately $1.9 million and $5.6 million, respectively, of incrementally recognized expense associated with the May 2023 modification of the vesting terms of outstanding unvested and unearned performance-based options, restricted stock units, and restricted stock awards. The three and nine months ended September 30, 2024 includes approximately $6.6 million and $11.7 million, respectively, of incrementally recognized expense associated with the May 2023 vesting modification and retirements of the Company's former Chief Financial Officer and President, Americas.
Current wording
Share-based compensation for the three months ended March 31, 2026 and 2025 includes approximately $0.6 million and $1.9 million, respectively, of incrementally recognized expense associated with the May 2023 modification of the vesting terms of outstanding unvested and unearned performance-based options, restricted stock units, and restricted stock awards.
Previous wording
Represents charges incurred related to acquisitions and similar transactions, primarily consisting of change in control-related costs, professional service fees, and other third-party costs. Transaction and acquisition related charges for the three and nine months ended September 30, 2025 include approximately $1.4 million and $7.5 million of expense, respectively, associated with the Sterling Acquisition. The three and nine months ended September 30, 2024 include approximately $13.2 million and $33.5 million of expense, respectively, associated with the Sterling Acquisition, primarily consisting of legal, regulatory, and diligence professional service fees. The three and nine months ended September 30, 2024 also include insurance costs incurred related to the Company's initial public offering.
Current wording
Represents charges incurred related to acquisitions and similar transactions, primarily consisting of change in control-related costs, professional service fees, and other third-party costs. Transaction and acquisition related charges for the three months ended March 31, 2026 and 2025 include approximately $0.2 million and $3.8 million, respectively, of expense associated with the Sterling Acquisition.
Previous wording
Represents charges from organizational restructuring and integration activities, non-cash, and other charges primarily related to nonrecurring legal exposures, foreign currency (gains) losses, impairment of capitalized software, (gains) losses on the sale of assets, and other non-recurring items. Integration, restructuring, and other charges for the three and nine months ended September 30, 2025 include approximately $3.8 million and $15.4 million of expense, respectively, associated with the integration of Sterling. The three and nine months ended September 30, 2025 also include approximately $1.5 million of expenses related to debt refinancing activities, as well as capitalized software impairment charges of approximately $1.2 million.
Current wording
Represents charges from organizational restructuring and integration activities, non-cash, and other charges primarily related to nonrecurring legal exposures, foreign currency (gains) losses, (gains) losses on the sale of assets, and other non-recurring items. Integration, restructuring, and other charges for the three months ended March 31, 2026 and 2025 include approximately $1.4 million and $7.8 million, respectively, of expense associated with the integration of Sterling.
Previous wording
Effective tax rates of approximately 25.1% and 25.3% have been used to compute Adjusted Net Income and Adjusted Diluted Earnings Per Share for the three and nine months ended September 30 2025, respectively. Effective tax rates of approximately 23.1% and 23.9% have been used to compute Adjusted Net Income and Adjusted Diluted Earnings Per Share for the three and nine months ended September 30 2024, respectively.
Current wording
Effective tax rates of approximately 25.6% and 25.1% have been used to compute Adjusted Net Income and Adjusted Diluted Earnings Per Share for the three months ended March 31, 2026 and 2025, respectively.
Previous wording
The Company’s primary liquidity requirements are for working capital, debt service, continued investments in software development and other capital expenditures, and other strategic investments, including the Sterling Acquisition and related integration. In addition, income taxes are and will be a material use of funds, depending on our future profitability and future tax rates. The Company’s liquidity needs are met primarily through existing balance sheet cash, cash flows from operations, as well as funds available under our revolving credit facility and proceeds from our term loan borrowings, including incremental term loan borrowings incurred to fund the Sterling Acquisition. Our cash flows from operations include cash received from customers, less cash costs to provide services to our customers, which includes general and administrative costs and interest payments.
Current wording
The Company’s primary liquidity requirements are for working capital, debt service, ongoing investments in software development and other capital expenditures, as well as other strategic growth initiatives. In addition, income taxes represent, and are expected to continue to represent, a significant use of cash depending on future profitability and applicable tax rates. The Company’s liquidity needs are met primarily through existing balance sheet cash, cash flows from operations, as well as funds available under our revolving credit facility and proceeds from our term loan borrowings, including incremental term loan borrowings incurred to fund the Sterling Acquisition. Our cash flows from operations include cash received from customers, less cash costs to provide services to our customers, which includes general and administrative costs and interest payments.
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Previous report — wording carried elsewhere
The increase in revenues is due to:
Previous report — wording carried elsewhere
revenues of $15.7 million, or 2.8%, from new customers, primarily attributable to our First Advantage Americas segment.
Previous report — wording carried elsewhere
The increase in product and technology expense was primarily due to: