The Baldwin Group — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenue increased 31% year-over-year to $480.3 million for the third quarter; organic revenue growth was 6% year-over-year.
• GAAP net loss was $81.6 million for the quarter, resulting in a diluted loss per share of $0.63; net loss margin was 17%.
• Adjusted EBITDA grew 47% year-over-year to $106.9 million, with an adjusted EBITDA margin of 22.2%, representing a 240 basis point expansion from 19.8% in the prior-year period.
• Adjusted net income was $59.4 million, and adjusted diluted EPS increased 35% year-over-year to $0.42.
• Net cash provided by operating activities was $54.2 million for the quarter; adjusted free cash flow increased 33% year-over-year to $55.6 million.
• For the nine months ended September 30, 2026, revenue increased 30% year-over-year to $1.5 billion, with organic revenue growth of 3%.
• Nine-month GAAP net loss was $139.5 million ($1.02 per share); adjusted EBITDA grew 33% to $360.8 million with a 24.0% margin.
• Nine-month adjusted free cash flow increased 33% year-over-year to $101.8 million.

Guidance and Future Outlook:

• No specific forward financial guidance or future growth targets were provided in the press release.
• The company expects the proposed Go-Private Transaction to close during the first quarter of 2027, subject to stockholder approval, regulatory approvals, and other customary closing conditions.
• Upon completion of the transaction, the Company's common stock will cease trading on Nasdaq.

Business Segments and Product Lines:

• CAC Group total revenue growth was 14% year-over-year for the third quarter and 20% for the nine-month period.
• The company represents more than three million clients across the United States and internationally.

Market and Competitive Landscape:

• No specific market share data, competitor analysis, or broader market trend commentary was included in the press release.

Risks and Challenges:

• The press release references "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2025, which include risks relevant to the business, financial condition, and results of operations.
• Forward-looking statements regarding the Go-Private Transaction and future performance are subject to risks and uncertainties that could cause actual results to differ materially from expectations.

Management Commentary and Tone:

• No direct quotes from management or specific commentary on operational tone were included in the press release text.

Analyst Questions and Answers:

• No analyst questions or answers section was included in the press release.

Other Key Points:

• On September 14, 2026, the Company entered into a definitive merger agreement for an all-cash take-private transaction led by an investor group including Sequence AI Holdings, Inc. and DFO Management, LLC.
• Stockholders will receive $32.50 per share in cash under the terms of the Merger Agreement.
• As of September 30, 2026, cash and cash equivalents were $188.6 million, with $289.1 million of borrowing capacity available under the revolving credit facility.
• The Company incurred $21.0 million in Go-Private Transaction costs during the third quarter.
• Long-term debt increased to $2.148 billion as of September 30, 2026, from $1.566 billion as of December 31, 2025.
• Goodwill increased to $2.65 billion as of September 30, 2026, from $1.52 billion as of December 31, 2025.
• The Company repurchased $126.8 million of common stock during the nine months ended September 30, 2026.
• The CAC Group was acquired effective January 1, 2026.
• The Company is executing a "$3B/30 Catalyst Program" designed to accelerate automation, business process optimization, and artificial intelligence.