Slides
Page 1
Q3 2025 Earnings Presentation November 6, 2025
Page 2
NON- GAAP FINANCIAL INFORMATION This presentation contains “non-GAAP financial measures” that are financial measures that either exclude or include amounts that are not excluded or included in the most directly comparable measures calculated and presented in accordance with accounting principles generally accepted in the United States (“GAAP”). Specifically, we make use of the non-GAAP financial measures “Adjusted EBITDA,” “Adjusted EBITDA Margin,” “Adjusted Net Income,” “Adjusted Diluted Earnings Per Share,” “Constant Currency Revenues,” and “Adjusted Operating Cash Flow.” Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Diluted Earnings Per Share, and Constant Currency Revenues have been presented in this presentation as supplemental measures of financial performance that are not required by or presented in accordance with GAAP because we believe they assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. Management believes these non-GAAP measures are useful to investors in highlighting trends in our operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate, and capital investments. Management uses Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Diluted Earnings Per Share, and Constant Currency Revenues to supplement GAAP measures of performance in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, to establish discretionary annual incentive compensation, and to compare our performance against that of other peer companies using similar measures. Management supplements GAAP results with non-GAAP financial measures to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone. Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Diluted Earnings Per Share, and Constant Currency Revenues are not recognized terms under GAAP and should not be considered as an alternative to net income (loss) as a measure of financial performance or cash provided by (used in) operating activities as a measure of liquidity, or any other performance measure derived in accordance with GAAP. We define Adjusted EBITDA as net income (loss) before interest, taxes, depreciation, and amortization, and as further adjusted for loss on extinguishment of debt, share-based compensation, transaction and acquisition-related charges, integration and restructuring charges, and other non-cash charges. We define Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenues. We define Adjusted Net Income for a particular period as net income (loss) before taxes adjusted for debt-related costs, acquisition-related depreciation and amortization, share-based compensation, transaction and acquisition-related charges, integration and restructuring charges, and other non-cash charges, to which we then apply the related effective tax rate. We define Adjusted Diluted Earnings Per Share as Adjusted Net Income divided by adjusted weighted average number of shares outstanding—diluted. We define Constant Currency Revenues as current period revenues translated using prior-year period exchange rates. Additionally, we use Adjusted Operating Cash Flow to review the liquidity of our operations. We define Adjusted Operating Cash Flow as cash flows from operating activities adjusted for cash costs directly associated with the Sterling acquisition and related integration. We believe Adjusted Operating Cash Flow is a useful supplemental financial measure for management and investors in assessing the Company’s ability to pursue business opportunities and investments and to service its debt. Adjusted Operating Cash Flow is not a measure of our liquidity under GAAP and should not be considered as an alternative to cash flows from operating activities. For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures, see the reconciliations included at the end of this presentation. The presentations of these measures have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Because not all companies use identical calculations, the presentations of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company. Numerical figures included in the reconciliations have been subject to rounding adjustments. Accordingly, numerical figures shown as totals in various tables may not be arithmetic aggregations of the figures that precede them. To facilitate comparability, we present pro forma combined company results, consisting of First Advantage and Sterling historical results and certain pro forma adjustments as if the acquisition of Sterling had occurred on 1/1/2023. The pro forma information does not constitute Article 11 pro forma information. FORWARD - LOOKING STATEMENTS This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, our operations and financial performance. Forward-looking statements include all statements that are not historical facts. These forward-looking statements relate to matters such as our industry, business strategy, goals, and expectations concerning our market position, future operations, margins, profitability, capital expenditures, liquidity and capital resources, and other financial and operating information. In some cases, you can identify these forward-looking statements by the use of words such as “anticipate,” “assume,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “future,” “will,” “seek,” “foreseeable,” “target, ” “guidance,” the negative version of these words, or similar terms and phrases. 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: 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; our reliance on third-party data providers; 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; 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; our ability to obtain, maintain, protect and enforce our intellectual property and other proprietary information; 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; our indebtedness could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry, and prevent us from meeting our obligations; the failure to realize the expected benefits of our acquisition of Sterling Check Corp.(“Sterling”); and control by our Sponsor, "Silver Lake" (Silver Lake Group, L.L.C., together with its affiliates, successors, and assignees) and its interests may conflict with ours or those of our stockholders. For additional information on these and other factors that could cause First Advantage’s actual results to differ materially from expected results, please see our Annual Report on Form 10-K for the year ended 12/31/2024, filed with the Securities and Exchange Commission (the “SEC”), as such factors may be updated from time to time in our filings with the SEC, which are or will be accessible on the SEC’s website at www.sec.gov. The forward-looking statements included in this presentation are made only as of the date of this presentation, and we undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as required by law. 2 NOTE This presentation contains references to historical results of Sterling. Historical results through 6/30/2024 are from Sterling’s historical SEC filings and disclosures. Historical results for 7/1/2024 through 10/31/2024 (date of acquisition) are from Sterling’s books and records. First Advantage Corporation and its subsidiaries are collectively referred to as the “Company”, “FA”, and “First Advantage”.
Page 3
Q3 2025 Highlights Scott Staples Chief Executive Officer
Page 4
Q3 2025 Key Messages 4 Solid Q3 performance, with revenues, Adjusted EBITDA, and Adjusted Diluted EPS growth driven by continuing go-to- market execution and synergy realization Narrowing full year 2025 guidance ranges, with refined midpoints at or above original guidance midpoints Celebrating one year post closing on Sterling acquisition; achieving integration goals ahead of schedule and high levels of customer retention Executing on FA 5.0 strategy, actioning best-of-breed product and platform approach to accelerate new logo, upsell and cross-sell, and enhance customer value proposition
Page 5
Solid Q3 2025 Results Adjusted Cash Flow from Operations2Revenues Adjusted EBITDA1 Adjusted Diluted EPS1 GO - TO - MARKET MOMENTUM VERTICAL TAKEAWAYS Three large wins now live and providing momentum into Q4 Healthcare win went live in Q3 Retail/Gig economy win went live in Q2 International win in Australia went live in Q2 Nearly all verticals up in Q3 on a pro forma, year- over-year basis, with momentum heading into Q4 Particular strength in retail & e-commerce, transportation & logistics, and general staffing Balance across diverse verticals, customer segments, and hourly- and salaried-focused customers provides resiliency in different macroeconomic scenarios 1. Non-GAAP measure. See appendix for reconciliation of Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, and Adjusted Diluted Earnings Per Share to their most directly comparable respective GAAP measures. 2. Non-GAAP measure. The Company generated $72.4 million of cash flow from operations, or $80.5 million after adjusting for $8.1 million of cash costs associated with the Sterling acquisition and related integration. 3. Q3 2025 vs Q3 2024 change assumes the acquisition of Sterling had occurred 1/1/2023. 5 Q3 2025 RESULTS Performance was in-line with or above previously stated expectations Q3 combined upsell, cross-sell, and new logo rates in line with long-term growth algorithm Retention reached 97%, up from 96% in Q2 17 enterprise bookings in Q3 and 75 in the last twelve months $409M 3.8% YoY Growth3 $118M 29.0% Adj. EBITDA Margin1 $0.30 $52M Adj. Net Income1 $81M $217M Cash Balance
Page 6
Executing on Post-Close Strategic Priorities 6 Integration Progress: Celebrating One-Year Post-Closing as of 10/31/25 Delivering strategic and financial benefits as promised Synergy Target Progression Minimum Range Investor Day Update2 $65M – $80M $50M – $70M $60M – $70M Q4’24 Update1 As of Close 10/31/2024 1. Range initially provided on 2/27/25. 2. Range initially provided on 5/28/25. Seamless, non-disruptive customer experience Best-of-breed approach driving growth and customer retention Connecting with customers through global Collaborate user conferences Increased back-end automation Actioning synergies and deleveraging
Page 7
FA 5.0 Focus: Enhancing the Customer Value Proposition through Best-of-Breed Approach 7 1. Represents portion of $24B+ 2025E Global Total Addressable Market for background screening and digital identity (based on management estimates and industry research, including Stax, IBIS World, and The Insight Partners), for digital identity specifically. Expanded Offerings Across Platforms Seeing Solid Momentum in Digital Identity Q1 2025: Award-winning Click.Chat.Call. customer care solution Q2 2025: Higher-margin Work Opportunity Tax Credit (WOTC) product Q1 2025 – Q3 2025: Proprietary National Criminal Record File database Q4 2025: Criminal and motor vehicle records monitoring solutions Q4 2025: Harmonizing user experience Fully linked in the pre-hire/post-hire lifecycle Increasing demand from customers across verticals Customers using at multiple stages of recruiting, screening, and onboarding Digital Identity Market1 $10B+ TAM Mid-to-High Teens Expected Market Growth+
Page 8
Financial Results & Outlook Steven Marks Chief Financial Officer
Page 9
$0.26 $0.30 Q3 2024 Q3 2025 ($ in millions, except per share data and percentages) Q3 2025 Financial Results $394.4 $409.2 Q3 2024 Q3 2025 REVENUES ADJUSTED EBITDA AND MARGIN1 ADJUSTED DILUTED EPS1 9 $109.3 $118.5 Q3 2024 Q3 2025 27.7% 29.0% (Pro Forma2) (Pro Forma2) 1. Non-GAAP measure. See appendix for reconciliation of Adjusted EBITDA, Adjusted EBITDA Margin, and Adjusted Diluted Earnings Per Share to their most directly comparable respective GAAP measures. 2. Non-GAAP measure. Pro forma measures assume the acquisition of Sterling had occurred 1/1/2023. See appendix for reconciliation of pro forma Revenues, pro forma Adjusted EBITDA, pro forma Adjusted EBITDA Margin, and pro forma constant currency revenues to their most directly comparable respective GAAP measures. 3. Pro forma currency impact on revenues was $(0.5) million. +3.8% +8.4% +15.4% Go-to-market success resulted in combined new logo, upsell, and cross-sell contribution of 9% Trends in base performance continued to moderate Retention reached 97%, up from 96% in Q2 Pro forma constant currency revenue growth of 3.6% 2,3 Adjusted EBITDA Margin increased 130 bps YoY due to the acceleration of synergy actioning and realization Deeply engrained, disciplined cost management approach within highly variable, flexible cost structure is a differentiator Benefits of greater scale and expense and capital management more than offset incremental interest on transaction financing and dilutive impact of new shares issued for the Sterling acquisition
Page 10
Delivering on Net Cost Synergies 10 Total Run Rate Synergy Target Expected To Be Actioned Within 2 Years ($60M – $70M previous target, up from $50M+ originally) $65M – $80M Note: Run rate synergy targets represent estimated timing and value. The acquisition of Sterling closed on 10/31/24. SYNERGY PRIORITIES Day 1 – 11/1/2024: Corporate Costs First 180 Days: Internal Operations Year 1: Cost of Sales and Fulfillment Year 2: Scaling Automation and AI SYNERGY REALIZATION $30M Year-to-date synergies realized as of 9/30/2025 $12M Quarter-to-date synergies realized as of 9/30/2025 $37M Run Rate Synergies Actioned as of 3/31/25 $20M Run Rate Synergies Actioned as of 12/31/24 ACHIEVED $47M Run Rate Synergies Actioned as of 6/30/25 $52M Run Rate Synergies Actioned as of 9/30/25
Page 11
Revenue Growth Algorithm Drivers 11 Legacy First Advantage 2023 Q1 ’24 Q2 ’24 Q3 ’24 Q4 ’24 2024 Upsell / Cross-sell 5% 4% 5% 7% 5% 5% New Logos 4% 5% 4% 3% 3% 4% Gross Retention 97% 97% 96% 96% 96% 96% Base (12%) (11%) (7%) (8%) (8%) (9%) Legacy Sterling 2023 Q1 ’24 Q2 ’24 Q3 ’24 Q4 ’24 2024 Upsell / Cross-sell 5% 9% 9% 10% 11% 10% New Logos 5% 6% 7% 7% 6% 7% Gross Retention 96% 97% 97% 96% 96% 96% Base (15%) (16%) (14%) (12%) (12%) (14%) First Advantage Q1’25 Q2’25 Q3’25 Upsell / Cross-sell 5% 5% 5% New Logos 4% 4% 4% Gross Retention 96% 96% 97% Base (6%) (4%) (2%)
Page 12
12 Cash Flow and Capital Structure 1. Non-GAAP measure. The Company generated $72.4 million of cash flow from operations, or $80.5 million after adjusting for $8.1 million of cash costs associated with the Sterling acquisition and related integration. 2. Synergized Pro Forma Adjusted EBITDA represents Pro Forma LTM Adjusted EBITDA plus mid-point of run rate synergy target range, which is expected to be actioned within 2 years post-closing, less realized synergies already included in Pro Forma LTM Adjusted EBITDA. 3. As previously presented in the 11/12/2024 Q3 2024 Earnings Presentation. 4. LTM 9/30/25 synergized pro forma net leverage is based on LTM 9/30/25 Synergized Pro Forma Adjusted EBITDA of $463.1M (which represents $424.6M of Pro Forma LTM Adjusted EBITDA plus $72.5M of run rate target synergies (representing the mid-point of the $65M to $80M run rate synergy target range which is expected to be actioned within 2 years post-closing), less $34M of realized synergies already in Pro Forma LTM Adjusted EBITDA) and net debt as of 9/30/25; calculated as ($2.14B Debt - $216.8M Cash and Cash Equivalents) / $463.1M LTM Synergized Pro Forma Adjusted EBITDA. Note: Adjusted EBITDA and net leverage are non-GAAP measures. Pro forma measures assume the acquisition of Sterling had occurred 1/1/2023. See appendix for reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure. Synergized Pro Forma2 Net Leverage Debt PaydownQ3 2025 Cash Flow Cash balance of $217M at 9/30/25 Q3 2025 Adjusted Operating Cash Flows of $80.5M1 Closely managing working capital to support cash flow and debt pay down Net leverage management remains a top priority Well ahead of schedule on path to de-leveraging CASH FLOW FROM OPERATIONS, ADJUSTED FOR THE ACQUISITION $43.5 $72.4 $8.1 Q3 2024 Q3 2025 ($ in millions) $45.3 $1.8 +78% +66% $80.5 GAAP Cash Flow From Operations Costs Related to the Acquisition Cash Flow from Operations, Adjusted 1 9/30/2024 9/30/2025 24 Months Post Close Long-Term Target Range 4.2x Target: ~3x 3 4.4x 4 Target: ~2-3x $70.5M Total debt repayments made since closing $25M $5.5M $20.5M $45.5M $70.5M Q1 2025 Q2 2025 Q3 2025 Q4 2025- To-Date CUMULATIVE DEBT REPAYMENTS SINCE CLOSING
Page 13
Note: Actual results may differ materially from First Advantage’s Full Year 2025 Guidance as a result of, among other things, the factors described under “Forward-Looking Statements” in this presentation. A reconciliation of the foregoing guidance for the non-GAAP metrics of (i) Adjusted EBITDA and Adjusted Net Income to GAAP net income (loss), (ii) Adjusted EBITDA margin to GAAP net income (loss) margin and (iii) Adjusted Diluted Earnings Per Share to GAAP diluted income earnings per share cannot be provided without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliation that have not yet occurred, are out of our control, or cannot be reasonably predicted. For the same reasons, the Company is unable to assess the probable significance of the unavailable information, which could have a material impact on its future GAAP financial results. 13 Refining Full Year 2025 Guidance Updated Guidance As of November 6, 2025 Prior Guidance As of August 7, 2025 Total Revenues $1.535B to $1.570B $1.5B to $1.6B Adjusted EBITDA $430M to $440M $410M to $450M Adjusted EBITDA Margin ~28% ~27% to ~28% Adjusted Net Income $170M to $180M $152M to $182M Adjusted Diluted Earnings Per Share $0.98 to $1.02 $0.86 to $1.03 Updated Guidance As of November 6, 2025
Page 14
Closing Remarks Scott Staples Chief Executive Officer
Page 15
:: 15 $1.8B - $ 2.0 B Targeted Revenue 4% - 7% CAGR 31% - 32% Targeted Adjusted EBITDA Margin $1.65 - $2.00 Targeted Adjusted Diluted EPS 19% - 25% CAGR $ 560M - $630 M Targeted Adjusted EBITDA 9% - 12% CAGR 2.0x – 3.0x Targeted Net Leverage Ratio Investment Thesis and Long-Term Targets A market leader offering proprietary technology and data in a large and growing market Significant organic revenue growth potential, accelerated by Sterling acquisition Industry-leading operating margins, leading to strong and consistent free cash flow generation Business resiliency backed by flexible cost structure and high revenue diversity Track record of value-accretive capital deployment and balance sheet management The above estimated targets for the future are based on current information and assumptions available to us and arriving at such numbers requires us to make a number of assumptions that may not be true. These numbers reflect long-term targets and do not constitute guidance for any period. There are a number of circumstances in the future that could greatly impact actual results, given circumstances that are not within our control, including the factors set forth under "Forward-Looking Statements". The targets should not be relied upon when making an investment decision. A reconciliation of the targets for the non-GAAP metrics of (i) Adjusted EBITDA to GAAP net income, (ii) Adjusted EBITDA margin to GAAP net income margin and (iii) Adjusted Diluted Earnings Per Share to GAAP diluted income earnings per share cannot be provided without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliation that have not yet occurred, are out of our control, or cannot be reasonably predicted. For the same reasons, we are unable to assess the probable significance of the unavailable information, which could have a material impact on its future GAAP financial results. Assumes base year of 2024 and no inorganic growth. Targeted Revenue and Adjusted EBITDA CAGRs calculated using 2024 pro forma. Targeted Adjusted Diluted EPS CAGR based on 2024 Adjusted Diluted EPS of $0.82.
Page 16
Appendix Supplemental Materials and Reconciliations to GAAP Measures
Page 17
First Advantage At a Glance 17 A Leading Provider of Global Software and Data in the HR Technology Industry 21% 15% 14%12% 11% 8% 7% 7% 5% OUR VERTICALS 5OUR SCALE $463M Synergized Pro Forma Adjusted EBITDA 1,2 80K Customers 66%+ of Fortune 100 and ~50% of Fortune 500 200+ Countries and Territories 100+ ATS and HCM 4 Integrated Partners 96% Average Gross Retention 900M+ Records in Proprietary Databases 3 $1.5B Pro Forma Revenue 1 12+ Year Average Tenure of Top 100 Customers 190M Annual Screens Healthcare Retail & E-Commerce Transportation & Logistics Financial Services Gig Economy Manufacturing & Industrials Business & Professional Services TMT & Hospitality General Staffing Note: All metrics are approximate and as of and for the year ended December 31, 2024, unless otherwise noted. Non-GAAP pro forma measures assume the acquisition of Sterling had occurred 1/1/2023. See appendix for reconciliation of pro forma Revenues and pro forma Adjusted EBITDA to their most directly comparable respective GAAP measures. 1. As of LTM 9/30/25. Non-GAAP measures. 2 . As of 9/30/25. Synergized Pro Forma Adjusted EBITDA as of 9/30/25 represents $424.6M of Pro Forma LTM Adjusted EBITDA plus $72.5M of run rate target synergies (representing the mid-point of the $65M to $80M run rate synergy target range which is expected to be actioned within 2 years post-closing), less $34M of realized synergies already in Pro Forma LTM Adjusted EBITDA. 3. Proprietary databases are in the US only and only for US residents and products. 4. Applicant Tracking System and Human Capital Management. 5. Vertical breakdown chart represents each vertical as an approximate percentage of FY2024 pro forma revenues, excluding SMB. Small and Midsize Business (“SMB”) represents ~5% of FY2024 pro forma revenues.
Page 18
Executing Integration Playbook. Seamless integration process focused on customer retention, synergy realization, and operational efficiency led by a dedicated team and supported by all functional areas Actioning Synergies. Target run rate cost synergy range of $65M to $80M to be actioned within 2 years post-closing, driven by reductions in third-party data costs and efficiencies across operations, product and technology, and SG&A Deleveraging Balance Sheet. Strong Adjusted EBITDA margins and robust operating cash flows will enable expected deleveraging to target of ~3x synergized pro forma Adjusted EBITDA within 24 months post-closing Maintaining Continuity with Customers. Enabling a smooth transition for Sterling customers while uncovering opportunities to enhance the customer value proposition and unlock upsell and cross-sell opportunities Driving Innovation. Technology driven innovation that provides customers with fast background checks; enabled through aligning sales, product, and technology organizations Fostering High-Performing Culture. Fostering an environment of active participation and mutual respect that not only drives innovation and productivity but also ensures that everyone feels valued and empowered to succeed Post-Close Strategic Priorities 18
Page 19
Full Year 2025 Guidance Details: Modeling Assumptions ($ in millions; all values are approximate) Assumption Actioned synergies expected to be realized in 2025 $33 – $38 Capital expenditures, including capitalized software development $57 – $64 Net interest expense, excluding amortization of financing fees and fair value gains/(losses) from interest rate swaps $150 – $155 Depreciation and amortization excluding intangible amortization $43 – $47 Foreign currency impact on revenues ($2) – $2 Foreign currency impact on Adjusted EBITDA ($1) – $1 Cash income tax payments $30 – $37 Adjusted effective tax rate 25.25% – 25.75% Fully diluted shares outstanding 175M – 176M Note: Actual results may differ materially from First Advantage’s Full Year 2025 Guidance as a result of, among other things, the factors described under “Forward-Looking Statements” in this presentation.19
Page 20
Long-term Growth Algorithm Targets 20 Note: Percentages subject to rounding. 1. Based on average annual gross retention. 2. Reflects expected vended background screening market growth. Base Growth Upsell/ Cross-sell Retention New Customers Long-Term Organic Revenue Growth Target Expected Vended Market Growth Existing Customers 2%-3% 4%-5% ~96% 4%-5% 7%-9% 6%-7% STRATEGY AND KEY ORGANIC GROWTH DRIVERS: Continued focus on AI, automation, and technology Strong track record of innovation Vertical go-to-market strategy Candidate experience Quality and compliance Customer success Proprietary data 1 2 New Customers
Page 21
1. Share-based compensation for the quarters ended September 30, 2024, December 31, 2024, March 31, 2025, June 30, 2025, and September 30, 2025, includes approximately $6.6 million, $5.6 million, $1.9 million, $1.8 million, and $1.9 million, respectively, of incrementally recognized expense associated with the May 2023 vesting modification and 2024 retirements of the Company’s former CFO and former President, Americas. 2. 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 quarters ended September 30, 2024, December 31, 2024, March 31, 2025, June 30, 2025, and September 30, 2025, include approximately $13.2 million, $92.3 million, $3.8 million, $2.3 million, and $1.4 million of expense, respectively, associated with the Sterling Acquisition, primarily consisting of legal, regulatory, and diligence professional service fees, compensation expense attributable to converted Sterling equity awards, post-combination restructuring expenses, success-based banking fees, and other one-time transaction costs. Also includes insurance costs incurred related to the First Advantage initial public offering. 3. 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 months ended March 31, 2025, June 30, 2025, and September 30, 2025, include approximately $7.8 million, $3.7 million, and $3.8 million of expense, respectively, associated with the integration of Sterling. The three months ended September 30, 2025 also includes approximately $1.5 million of expenses related to debt refinancing activities, as well as capitalized software impairment charges of approximately $1.2 million. Reported First Advantage Adjusted EBITDA 21 LTM (in thousands, except percentages) Sep 30, 2024 Q3 Dec 31, 2024 Q4 Mar 31, 2025 Q1 Jun 30, 2025 Q2 Sep 30, 2025 Q3 Sep 30, 2025 Net (loss) income (8,860)$ (100,366)$ (41,194)$ 308$ 2,593$ (138,659)$ Interest expense, net 17,191 23,734 46,580 44,785 40,041 155,140 Provision (benefit) for income taxes 782 (4,425) 2,231 (7,610) (798) (10,602) Depreciation and amortization 30,168 55,951 61,666 61,906 62,274 241,797 Loss on extinguishment of debt — 383 — 254 407 1,044 Share-based compensation (1) 9,504 12,459 7,967 5,742 5,721 31,889 Transaction and acquisition-related charges (2) 13,218 93,151 3,996 2,390 1,585 101,122 Integration, restructuring, and other charges (3) 2,043 2,050 10,866 6,171 6,677 25,764 Adjusted EBITDA 64,046$ 82,937$ 92,112$ 113,946$ 118,500$ 407,495$ Revenues 199,119 307,124 354,588 390,633 409,151 1,461,496 Net (loss) income margin (4.4)% (32.7)% (11.6)% 0.1% 0.6% (9.5)% Adjusted EBITDA Margin 32.2% 27.0% 26.0% 29.2% 29.0% 27.9% For the Quarters Ended
Page 22
Pro Forma 2025 LTM First Advantage Adjusted EBITDA 22 To facilitate comparability, we present pro forma combined company results, consisting of First Advantage and Sterling historical results and certain pro forma adjustments as if the acquisition of Sterling had occurred on 1/1/2023. The pro forma information does not constitute Article 11 pro forma information. Reported Year Ended LTM (in thousands, except percentages) Sep 30, 2025 Sep 30, 2024 Dec 31, 2024 Sep 30, 2025 Net loss (38,293)$ (107,167)$ (139,432)$ (70,558)$ Interest expense, net 131,406 126,332 160,181 165,255 (Benefit) provision for income taxes (6,177) (8,441) 789 3,053 Depreciation and amortization 185,846 214,764 286,226 257,308 Loss on extinguishment of debt 661 — 383 1,044 Share-based compensation 19,430 51,882 68,420 35,967 Transaction and acquisition-related charges 7,971 5,776 6,002 8,197 Integration, restructuring, and other charges 23,714 13,309 13,932 24,337 Adjusted EBITDA 324,558$ 296,456$ 396,500$ 424,602$ Revenues 1,154,372 1,134,287 1,509,560 1,529,645 Net loss margin (3.3)% (9.4)% (9.2)% (4.6)% Adjusted EBITDA Margin 28.1% 26.1% 26.3% 27.8% Pro Forma Nine Months Ended
Page 23
Pro Forma 2024 First Advantage Adjusted EBITDA 23 To facilitate comparability, we present pro forma combined company results, consisting of First Advantage and Sterling historical results and certain pro forma adjustments as if the acquisition of Sterling had occurred on 1/1/2023. The pro forma information does not constitute Article 11 pro forma information. 1. Historical results through 6/30/2024 are from Sterling’s historical SEC filings and disclosures. Historical results for 7/1/2024 through 10/31/2024 (date of acquisition) are from Sterling’s books and records. (in thousands, except percentages) Reported First Advantage Historical Legacy Sterling (1) Adjustments Pro Forma First Advantage Net loss (9,907)$ (34,365)$ (62,894)$ (107,167)$ Interest expense, net 28,114 30,198 68,020 126,332 Provision (benefit) for income taxes 83 12,296 (20,820) (8,441) Depreciation and amortization 89,968 47,385 77,411 214,764 Share-based compensation 19,303 32,579 — 51,882 Transaction and acquisition-related charges 35,083 32,410 (61,717) 5,776 Integration, restructuring, and other charges 3,721 9,588 — 13,309 Adjusted EBITDA 166,365$ 130,091$ —$ 296,456$ Revenues 553,081 582,043 (837) 1,134,287 Net loss margin (1.8)% (5.9)% n/a (9.4)% Adjusted EBITDA Margin 30.1% 22.4% n/a 26.1% For the Nine Months Ended September 30, 2024 (in thousands, except percentages) Reported First Advantage Historical Legacy Sterling (1) Adjustments Pro Forma First Advantage Net loss (8,860)$ (20,178)$ (18,371)$ (47,409)$ Interest expense, net 17,191 9,743 22,558 49,492 Provision (benefit) for income taxes 782 14,220 (6,081) 8,921 Depreciation and amortization 30,168 15,795 25,726 71,689 Share-based compensation 9,504 11,534 — 21,038 Transaction and acquisition-related charges 13,218 11,302 (23,832) 688 Integration, restructuring, and other charges 2,043 2,881 — 4,924 Adjusted EBITDA 64,046$ 45,297$ —$ 109,343$ Revenues 199,119 195,516 (279) 394,356 Net loss margin (4.4)% (10.3)% n/a (12.0)% Adjusted EBITDA Margin 32.2% 23.2% n/a 27.7% For the Quarter Ended September 30, 2024
Page 24
Pro Forma 2024 First Advantage Adjusted EBITDA (Continued) 24 To facilitate comparability, we present pro forma combined company results, consisting of First Advantage and Sterling historical results and certain pro forma adjustments as if the acquisition of Sterling had occurred on 1/1/2023. The pro forma information does not constitute Article 11 pro forma information. 1. Historical results through 6/30/2024 are from Sterling’s historical SEC filings and disclosures. Historical results for 7/1/2024 through 10/31/2024 (date of acquisition) are from Sterling’s books and records.
Page 25
1. 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. 2. Represents the depreciation and amortization expense related to incremental intangible and developed technology assets recorded due to the application of ASC 805, Business Combinations. As a result, the purchase accounting related depreciation and amortization expense will recur in future periods until the related assets are fully depreciated or amortized, and the related purchase accounting assets may contribute to revenue generation. 3. Share-based compensation for three months ended September 30, 2024 includes approximately $6.6 million of incrementally recognized expense associated with the May 2023 vesting modification and retirements of the Company's former Chief Financial Officer and President, Americas. The three months ended September 30, 2025 includes approximately $1.9 million 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. 4. 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 September 30, 2024 include approximately $13.2 million of expense associated with the Sterling Acquisition, primarily consisting of legal, regulatory, and diligence professional service fees. The three months ended September 30, 2024 also includes insurance costs incurred related to the Company's initial public offering. Transaction and acquisition related charges for the three months ended September 30, 2025 includes approximately $1.4 million of expense associated with the Sterling Acquisition. 5. 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 months ended September 30, 2025 includes approximately $3.8 million of expense associated with the integration of Sterling. The three months ended September 30, 2025 also includes approximately $1.5 million of expenses related to debt refinancing activities, as well as capitalized software impairment charges of approximately $1.2 million. 6. Effective tax rates of approximately 23.1% and 25.1% have been used to compute Adjusted Net Income and Adjusted Diluted Earnings Per Share for the three months ended September 30 , 2024 and 2025, respectively. Reported First Advantage Adjusted Net Income 25 Reported First Advantage Adjusted Earnings Per Share Sep 30, 2024 Q3 Sep 30, 2025 Q3 Diluted net (loss) income per share (GAAP) (0.06)$ 0.01$ Adjusted Net (Loss) Income adjustments per share Provision (benefit) for income taxes 0.01 (0.00) Debt-related charges(1) 0.07 0.01 Acquisition-related depreciation and amortization (2) 0.15 0.29 Share-based compensation (3) 0.06 0.03 Transaction and acquisition related charges(4) 0.09 0.01 Integration, restructuring, and other charges(5) 0.01 0.04 Adjusted income taxes(6) (0.08) (0.10) Adjusted Diluted Earnings Per Share (Non-GAAP) 0.26$ 0.30$ Weighted average number of shares outstanding used in computation of Adjusted Diluted Earnings Per Share: Weighted average number of shares outstanding—diluted (GAAP and Non-GAAP) 144,096,312 175,549,342 Options and restricted stock not included in weighted average number of shares outstanding—diluted (GAAP) (using treasury stock method) 2,492,320 — Adjusted weighted average number of shares outstanding—diluted (Non- GAAP) 146,588,632 175,549,342 For the Quarters Ended (in thousands) Sep 30, 2024 Q3 Sep 30, 2025 Q3 Net (loss) income (8,860)$ 2,593$ Provision (benefit) for income taxes 782 (798) (Loss) income before provision for income taxes (8,078) 1,795 Debt-related charges(1) 10,057 2,585 Acquisition-related depreciation and amortization (2) 22,646 51,516 Share-based compensation (3) 9,504 5,721 Transaction and acquisition-related charges(4) 13,218 1,585 Integration, restructuring, and other charges(5) 2,043 6,677 Adjusted Net Income before income tax effect 49,390 69,879 Less: Adjusted income taxes(6) 11,400 17,567 Adjusted Net Income 37,990$ 52,312$ For the Quarters Ended
Page 26
1. Constant currency revenue is calculated by translating current period amounts using prior-year period exchange rates. The foreign currency translation impact of First Advantage and Sterling on a stand-alone basis was $(0.4)M and $(0.1)M, respectively. 2. To facilitate comparability, we present pro forma combined company results, consisting of First Advantage and Sterling historical results and certain pro forma adjustments as if the acquisition of Sterling had occurred on 1/1/2023. The pro forma information does not constitute Article 11 pro forma information. 26 Pro Forma First Advantage Constant Currency Revenues
Page 27
Reported First Advantage Adjusted Operating Cash Flow 27 (in thousands, except percentages) Sep 30, 2024 Q3 Sep 30, 2025 Q3 Cash flows from operating activities, as reported (GAAP) 43,490$ 72,369$ Cost paid related to the Sterling acquisition and integration 1,824 8,141 Adjusted Operating Cash Flow 45,314$ 80,510$ Cash flow from operating activities Year/Year Growth 66.4% Adjusted Operating Cash Flow Year/Year Growth 77.7% For the Quarters Ended
Page 28
28 Pro Forma 2024 LTM First Advantage Adjusted EBITDA To facilitate comparability, we present pro forma combined company results, consisting of First Advantage and Sterling historical results and certain pro forma adjustments as if the acquisition of Sterling had occurred on 1/1/2023. The pro forma information does not constitute Article 11 pro forma information.
Page 29
29 To facilitate comparability, we present pro forma combined company results, consisting of First Advantage and Sterling historical results and certain pro forma adjustments as if the acquisition of Sterling had occurred on 1/1/2023. The pro forma information does not constitute Article 11 pro forma information. Pro Forma 2023 First Advantage Adjusted EBITDA