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Reportable Segments
 9 Months Ended
Sep. 30, 2025
Segment Reporting [Abstract]  
Reportable Segments

Note 15. Reportable Segments

The Company has three reportable segments:

•
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.
•
First Advantage International. The First Advantage International segment pertains to our Legacy First Advantage business and provides services similar to our Americas segment in regions outside of the Americas. We primarily deliver our solutions across multiple industry verticals in the Europe, India, and Asia Pacific.
•
Sterling. This segment is comprised of the acquired entity, Sterling Check Corp., which was acquired on October 31, 2024. The Sterling segment provides similar services as compared to First Advantage’s Americas and International segments on a global basis.

Our chief operating decision maker (“CODM”) uses the performance measure of Adjusted EBITDA, on both a consolidated and a segment basis, to allocate resources and assess performance of our businesses. Our CODM also uses Adjusted EBITDA as a performance measure for both segment and corporate management under our incentive compensation plans. Corporate costs are generally allocated to the segments based upon estimated revenue levels and other assumptions that management considers reasonable. Adjusted cost of services consists of amounts paid to third parties for access to government records, other third-party data and services, our internal processing fulfillment and customer care functions, and other cost of services excluding depreciation and amortization, share-based compensation expenses, transaction expenses, and integration expenses. Other segment items consist of product and technology and selling, general, and administrative expenses, but similarly excludes depreciation and amortization, share based compensation, and other expenses excluded from Adjusted EBITDA.

The CODM does not review the Company’s assets by segment as it does not provide additional insights into the performance of our business; therefore, such information is not presented. The accounting policies of the segments are the same as described in Note 1. “Organization, Nature of Business, and Basis of Presentation” and Note 2. “Summary of Significant Accounting Policies” included in the Annual Report on Form 10-K for the year ended December 31, 2024.

Reconciliations of Segment Adjusted EBITDA to net income (loss) for the three and nine months ended September 30, 2025 and 2024 is as follows (in thousands):

 

 

Three Months Ended September 30, 2025

 

 

 

First Advantage Americas

 

 

First Advantage International

 

 

Sterling

 

 

Total

 

Total revenues

 

$

182,805

 

 

$

29,740

 

 

$

199,440

 

 

$

411,985

 

Intersegment revenues

 

 

(462

)

 

 

(1,533

)

 

 

(839

)

 

 

(2,834

)

External revenues

 

$

182,343

 

 

$

28,207

 

 

$

198,601

 

 

$

409,151

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted cost of services

 

 

93,887

 

 

 

18,932

 

 

 

112,604

 

 

 

 

Other segment items

 

 

32,453

 

 

 

5,706

 

 

 

29,903

 

 

 

 

Segment Adjusted EBITDA

 

$

56,465

 

 

$

5,102

 

 

$

56,933

 

 

$

118,500

 

Adjustments to reconcile to net income:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

 

 

 

 

 

 

 

 

 

40,041

 

Benefit for income taxes

 

 

 

 

 

 

 

 

 

 

 

(798

)

Loss on extinguishment of debt

 

 

 

 

 

 

 

 

 

 

 

407

 

Depreciation and amortization

 

 

 

 

 

 

 

 

 

 

 

62,274

 

Share-based compensation

 

 

 

 

 

 

 

 

 

 

 

5,721

 

Transaction and acquisition-related charges (a)

 

 

 

 

 

 

 

 

 

 

 

1,585

 

Integration, restructuring, and other charges (b)

 

 

 

 

 

 

 

 

 

 

 

6,677

 

Net income

 

 

 

 

 

 

 

 

 

 

$

2,593

 

 

 

 

 

Three Months Ended September 30, 2024

 

 

 

First Advantage Americas

 

 

First Advantage International

 

 

Sterling

 

 

Total

 

Total revenues

 

$

174,905

 

 

$

26,624

 

 

$

—

 

 

$

201,529

 

Intersegment revenues

 

 

(516

)

 

 

(1,894

)

 

 

—

 

 

 

(2,410

)

External revenues

 

$

174,389

 

 

$

24,730

 

 

$

—

 

 

$

199,119

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted cost of services

 

 

89,184

 

 

 

14,579

 

 

 

—

 

 

 

 

Other segment items

 

 

27,084

 

 

 

6,636

 

 

 

—

 

 

 

 

Segment Adjusted EBITDA

 

$

58,637

 

 

$

5,409

 

 

$

—

 

 

$

64,046

 

Adjustments to reconcile to net loss:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

 

 

 

 

 

 

 

 

 

17,191

 

Provision for income taxes

 

 

 

 

 

 

 

 

 

 

 

782

 

Depreciation and amortization

 

 

 

 

 

 

 

 

 

 

 

30,168

 

Share-based compensation

 

 

 

 

 

 

 

 

 

 

 

9,504

 

Transaction and acquisition-related charges (a)

 

 

 

 

 

 

 

 

 

 

 

13,218

 

Integration, restructuring, and other charges (b)

 

 

 

 

 

 

 

 

 

 

 

2,043

 

Net loss

 

 

 

 

 

 

 

 

 

 

$

(8,860

)

 

 

 

Nine Months Ended September 30, 2025

 

 

 

First Advantage Americas

 

 

First Advantage International

 

 

Sterling

 

 

Total

 

Total revenues

 

$

491,662

 

 

$

79,435

 

 

$

590,701

 

 

$

1,161,798

 

Intersegment revenues

 

 

(1,596

)

 

 

(4,349

)

 

 

(1,481

)

 

 

(7,426

)

External revenues

 

$

490,066

 

 

$

75,086

 

 

$

589,220

 

 

$

1,154,372

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted cost of services

 

 

251,064

 

 

 

47,310

 

 

 

330,027

 

 

 

 

Other segment items

 

 

92,566

 

 

 

19,317

 

 

 

96,956

 

 

 

 

Segment Adjusted EBITDA

 

$

148,032

 

 

$

12,808

 

 

$

163,718

 

 

$

324,558

 

Adjustments to reconcile to net loss:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

 

 

 

 

 

 

 

 

 

131,406

 

Benefit for income taxes

 

 

 

 

 

 

 

 

 

 

 

(6,177

)

Loss on extinguishment of debt

 

 

 

 

 

 

 

 

 

 

 

661

 

Depreciation and amortization

 

 

 

 

 

 

 

 

 

 

 

185,846

 

Share-based compensation

 

 

 

 

 

 

 

 

 

 

 

19,430

 

Transaction and acquisition-related charges (a)

 

 

 

 

 

 

 

 

 

 

 

7,971

 

Integration, restructuring, and other charges (b)

 

 

 

 

 

 

 

 

 

 

 

23,714

 

Net loss

 

 

 

 

 

 

 

 

 

 

$

(38,293

)

 

 

 

Nine Months Ended September 30, 2024

 

 

 

First Advantage Americas

 

 

First Advantage International

 

 

Sterling

 

 

Total

 

Total revenues

 

$

486,410

 

 

$

72,834

 

 

$

—

 

 

$

559,244

 

Intersegment revenues

 

 

(1,247

)

 

 

(4,916

)

 

 

—

 

 

 

(6,163

)

External revenues

 

$

485,163

 

 

$

67,918

 

 

$

—

 

 

$

553,081

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted cost of services

 

 

246,374

 

 

 

40,633

 

 

 

—

 

 

 

 

Other segment items

 

 

86,136

 

 

 

19,736

 

 

 

—

 

 

 

 

Segment Adjusted EBITDA

 

$

153,900

 

 

$

12,465

 

 

$

—

 

 

$

166,365

 

Adjustments to reconcile to net loss:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

 

 

 

 

 

 

 

 

 

28,114

 

Provision for income taxes

 

 

 

 

 

 

 

 

 

 

 

83

 

Depreciation and amortization

 

 

 

 

 

 

 

 

 

 

 

89,968

 

Share-based compensation

 

 

 

 

 

 

 

 

 

 

 

19,303

 

Transaction and acquisition-related charges (a)

 

 

 

 

 

 

 

 

 

 

 

35,083

 

Integration, restructuring, and other charges (b)

 

 

 

 

 

 

 

 

 

 

 

3,721

 

Net loss

 

 

 

 

 

 

 

 

 

 

$

(9,907

)
(a)
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.
(b)
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.

Geographic Information

The Company categorizes revenues by geographic region in which the revenues and invoicing are recorded. Other than the United States, no single country accounted for 10% or more of our total revenues during these periods.

The following summarizes revenues by geographical region (in thousands):

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

$

349,284

 

 

$

170,823

 

 

$

987,980

 

 

$

475,900

 

All other countries

 

 

59,867

 

 

 

28,296

 

 

 

166,392

 

 

 

77,181

 

Total revenues

 

$

409,151

 

 

$

199,119

 

 

$

1,154,372

 

 

$

553,081

 

The following table sets forth net long-lived assets by geographic area (in thousands):

 

September 30, 2025

 

 

December 31, 2024

 

Long-lived assets, net

 

 

 

 

 

 

United States

 

$

2,863,195

 

 

$

2,996,933

 

All other countries

 

 

438,338

 

 

 

436,741

 

Total long-lived assets, net

 

$

3,301,533

 

 

$

3,433,674