Revenue growth reached 111.7% in 2025Q2, yet gross margins have contracted significantly from 50.0% in 2023Q4 to 29.0% by 2026Q1 due to the integration of lower-margin data costs.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 | Dec'03 |
|---|
| Sales/Revenue | 1.61B | 1.57B | 860.21M | 763.76M | 810.02M | 712.29M | 509.15M | 481.77M | 779.96M | 842.9M | 817.56M | 643.75M | 266.54M | 166.5M |
| Revenue Growth % | 53.53% | 83.02% | 12.63% | -5.71% | 13.72% | 39.9% | 5.68% | -38.23% | -7.47% | 3.1% | 27% | 141.52% | 60.09% | - |
| Cost of Goods Sold | 1.02B | 1.1B | 448.91M | 386.78M | 408.93M | 352.17M | 260.55M | 245.32M | 282.67M | 281.75M | 291.35M | 231.62M | 105.48M | 100.19M |
| COGS % of Revenue | - | 70.12% | 52.19% | 50.64% | 50.48% | 49.44% | 51.17% | 50.92% | 36.24% | 33.43% | 35.64% | 35.98% | 39.58% | 60.17% |
| Gross Profit | 582.04M | 470.5M | 411.29M | 376.98M | 401.1M | 360.13M | 248.6M | 236.44M | 497.3M | 561.15M | 526.22M | 412.13M | 161.05M | 66.31M |
| Gross Margin % | 36.26% | 29.88% | 47.81% | 49.36% | 49.52% | 50.56% | 48.83% | 49.08% | 63.76% | 66.57% | 64.36% | 64.02% | 60.42% | 39.83% |
| Gross Profit Growth % | - | 14.4% | 9.1% | -6.01% | 11.38% | 44.86% | 5.14% | -52.45% | -11.38% | 6.64% | 27.68% | 155.89% | 142.89% | - |
| Operating Expenses | 422.33M | 329.29M | 473.68M | 295.47M | 306.82M | 296.3M | 250.65M | 144.28M | 425.48M | 443.58M | 405.85M | 314.13M | 140.37M | 91.79M |
| OpEx % of Revenue | - | 20.92% | 55.07% | 38.69% | 37.88% | 41.6% | 49.23% | 29.95% | 54.55% | 52.63% | 49.64% | 48.8% | 52.67% | 55.13% |
| Selling, General & Admin | 108.37M | 236.18M | 263.94M | 116.73M | 116.64M | 107.98M | 78.1M | 85.08M | 274.43M | 401.46M | 366.7M | 286.52M | 127.83M | 51.18M |
| SG&A % of Revenue | - | 15% | 30.68% | 15.28% | 14.4% | 15.16% | 15.34% | 17.66% | 35.18% | 47.63% | 44.85% | 44.51% | 47.96% | 30.74% |
| Research & Development | 50.81M | 0 | 63.82M | 49.26M | 51.93M | 45.51M | 35.39M | 33.24M | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | 7.42% | 6.45% | 6.41% | 6.39% | 6.95% | 6.9% | - | - | - | - | - | - |
| Other Operating Expenses | 3M | 93.11M | 145.92M | 129.47M | 138.25M | 142.81M | 137.16M | 25.95M | 151.05M | 42.12M | 39.15M | 27.61M | 12.54M | 40.62M |
| Operating Income | 159.71M | 141.21M | -62.38M | 81.52M | 94.28M | 63.82M | -2.05M | 92.17M | 121.13M | 117.57M | 120.36M | 98M | 20.68B | 4.96M |
| Operating Margin % | 9.95% | 8.97% | -7.25% | 10.67% | 11.64% | 8.96% | -0.4% | 19.13% | 15.53% | 13.95% | 14.72% | 15.22% | 7758.77% | 2.98% |
| Operating Income Growth % | - | 326.35% | -176.53% | -13.54% | 47.72% | 3214.84% | -102.22% | -23.91% | 3.02% | -2.32% | 22.82% | -99.53% | 416667.43% | - |
| EBITDA | 408.81M | 389.79M | 83.53M | 210.99M | 232.52M | 206.64M | 135.11M | 118.12M | 163.72M | 157.29M | 159.52M | 125.61M | 20.7B | 25.68M |
| EBITDA Margin % | 25.47% | 24.76% | 9.71% | 27.63% | 28.71% | 29.01% | 26.54% | 24.52% | 20.99% | 18.66% | 19.51% | 19.51% | 7767.47% | 15.42% |
| EBITDA Growth % | 230.43% | 366.62% | -60.41% | -9.26% | 12.53% | 52.94% | 14.39% | -27.85% | 4.09% | -1.39% | 27% | -99.39% | 80516.74% | - |
| D&A (Non-Cash Add-back) | 249.11M | 248.58M | 145.92M | 129.47M | 138.25M | 142.81M | 137.16M | 25.95M | 42.59M | 39.72M | 39.15M | 27.61M | 23.18M | 20.72M |
| EBIT | 162.92M | 131.42M | -62.77M | 81.52M | 94.28M | 52.32M | -2.05M | 93.11M | 72.72M | 223.47M | 119.42M | 96.75M | 72.23M | 902K |
| Net Interest Income | -151.93M | -168.67M | -51.85M | -33.04M | -9.2M | -24.97M | -47.49M | -51.02M | -1.65M | -8.62M | 0 | 0 | 27.76M | -72K |
| Interest Income | 0 | 0 | 0 | 0 | 0 | 150K | 555K | 945K | 897K | 2.02M | 0 | 0 | 30M | 41K |
| Interest Expense | 151.93M | 168.67M | 51.85M | 33.04M | 9.2M | 25.12M | 48.05M | 51.96M | 2.55M | 10.64M | 6.43M | 0 | 2.24M | 113K |
| Other Income/Expense | -154.69M | -178.46M | -52.23M | -33.04M | -9.2M | -38.91M | -69.75M | -51.02M | 102.51M | 104.61M | -6.43M | 3.94M | -2.24B | -113K |
| Pretax Income | 5.02M | -37.25M | -114.61M | 48.48M | 85.08M | 24.91M | -71.8M | 41.15M | 223.64M | 222.19M | 113.93M | 102.39M | 18.44B | 4.85M |
| Pretax Margin % | 0.31% | -2.37% | -13.32% | 6.35% | 10.5% | 3.5% | -14.1% | 8.54% | 28.67% | 26.36% | 13.94% | 15.91% | 6919.49% | 2.91% |
| Income Tax | -3.52M | -2.43M | -4.34M | 11.18M | 20.48M | 8.86M | 12.23M | 6.9M | 85.53M | 84.08M | 47.38M | 43.01M | 29.72M | 32.76M |
| Effective Tax Rate % | -70.18% | 6.52% | 3.79% | 23.07% | 24.07% | 35.57% | -17.03% | 16.76% | 38.25% | 37.84% | 41.59% | 42% | 0.16% | 675.5% |
| Net Income | 8.54M | -34.82M | -110.27M | 37.29M | 64.6M | 16.05M | -84.02M | 34.25M | 34.86M | 138.11M | 66.16M | 58.43M | 10.68M | 2.8M |
| Net Margin % | 0.53% | -2.21% | -12.82% | 4.88% | 7.98% | 2.25% | -16.5% | 7.11% | 4.47% | 16.38% | 8.09% | 9.08% | 4.01% | 1.68% |
| Net Income Growth % | 105.75% | 68.42% | -395.69% | -42.27% | 302.49% | 119.1% | -345.32% | -1.74% | -74.76% | 108.74% | 13.24% | 447.01% | 281.06% | - |
| Net Income (Continuing) | 8.54M | -34.82M | -110.27M | 37.29M | 64.6M | 16.05M | -84.02M | 34.25M | 39.1M | 126.12M | 65.6M | 57.69M | 42.33M | 37.88M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 44.2M | 48.42M | 48.41M | 47.71M | 0 | 0 |
| EPS (Diluted) | 0.05 | -0.20 | -0.74 | 0.26 | 0.43 | 0.11 | -0.55 | 0.22 | 0.59 | 2.34 | 1.14 | 1.09 | 0.85 | 0.03 |
| EPS Growth % | 105.37% | 72.97% | -384.62% | -39.53% | 290.91% | 120% | -350% | -62.71% | -74.79% | 105.26% | 4.59% | 28.24% | 2633.12% | - |
| EPS (Basic) | - | -0.20 | -0.74 | 0.26 | 0.43 | 0.11 | -0.55 | 0.22 | 0.59 | 2.35 | 1.15 | 1.10 | 0.85 | 0.03 |
| Diluted Shares Outstanding | 174.92M | 173.2M | 148.58M | 146.23M | 151.81M | 152.9M | 152.86M | 152.86M | 59.5M | 59.12M | 58.08M | 53.59M | 50.04M | 90.06M |
| Basic Shares Outstanding | 173.9M | 173.2M | 148.58M | 144.08M | 150.23M | 152.9M | 152.86M | 152.86M | 59.39M | 58.87M | 57.5M | 52.88M | 49.71M | 89.84M |
| Dividend Payout Ratio | - | - | - | 583.86% | - | 1.95% | - | - | - | 2.85% | - | - | - | - |
Integration and Margin Dilution
As reported in recent financial statements, First Advantage achieved a significant revenue expansion, with year-over-year growth peaking at 111.7% in 2025Q2, largely reflecting the successful integration of Sterling Check and a shift toward a more aggressive, acquisition-led growth strategy within the background screening industry.
The dramatic top-line acceleration suggests that the company is prioritizing market share consolidation over organic velocity. Investors should monitor whether this inorganic growth can be sustained through cross-selling synergies or if the revenue trajectory will normalize as the integration phase concludes.
Based on reported figures, gross margins have experienced notable volatility, contracting from 50.0% in 2023Q4 to 29.0% by 2026Q1, which appears to indicate that the recent acquisition strategy has introduced a higher mix of lower-margin, pass-through data costs into the company's consolidated income statement.
The compression suggests that the company's current service mix is increasingly reliant on third-party data acquisition, which limits operating leverage. This trend warrants further investigation into whether management can improve automation rates to restore historical margin levels or if this represents a new, lower-margin baseline.
According to recent SEC filings, the company's net income has frequently dipped into negative territory, such as the -$41.2M reported in 2025Q1, despite positive operating income, suggesting that heavy non-cash charges related to intangible asset amortization are significantly obscuring the underlying profitability of the core business.
The discrepancy between operating income and net income implies that GAAP earnings may not be the most reliable metric for assessing the company's cash-generating potential. Analysts should focus on adjusted figures to determine if the business is truly creating value or merely servicing the costs of its M&A activity.
Data from the latest income statements reveals that while revenue has scaled rapidly, the company has struggled to maintain consistent net profitability, with net margins fluctuating between -32.7% and 7.3% over the last ten quarters, raising questions about the long-term efficiency of the current roll-up model.
Short-sellers may focus on the persistent gap between top-line growth and bottom-line conversion as evidence of integration friction. It appears that the company's reliance on inorganic expansion may be masking operational inefficiencies that could become more pronounced if the pace of acquisition slows down.
Quick answers to the most common questions about buying FA stock.
For fiscal year 2025, First Advantage Corporation (FA) reported total revenue of $1.57B. This represents a 845.6% increase compared to $166.5M in 2003.
First Advantage Corporation (FA) reported a net loss of $34.8M for the fiscal year ending 2025.
First Advantage Corporation (FA) reported an operating income of $141.2M, resulting in an operating profit margin of 9.0%. This margin reflects the operational efficiency of the business before interest and taxes.
First Advantage Corporation (FA) generated $470.5M in gross profit for the year, representing a gross profit margin of 29.9%. This demonstrates the company's core pricing power and production efficiency.