Alight (NYSE: ALIT) takes $3.1B goodwill charge and ends cash dividend
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Alight, Inc. reported fourth quarter 2025 revenue of $653 million and full-year 2025 revenue of $2,262 million, both down modestly from 2024. Recurring revenue remained high at over 93% of total revenue.
The company posted a full-year net loss from continuing operations of $3,078 million, driven mainly by a $3,124 million non-cash goodwill impairment, which also led to a fourth quarter net loss of $933 million. Despite this accounting charge, underlying performance was steadier, with adjusted EBITDA from continuing operations of $561 million, slightly above 2024, and free cash flow of $250 million compared with $72 million a year earlier.
Alight ended 2025 with $273 million in cash and $2,005 million of total debt. It declared and paid a quarterly dividend of $0.04 per share in 2025 but now plans to replace its cash dividend with capital allocation focused on deleveraging the balance sheet and, subject to conditions, share repurchases, which it believes better support long-term shareholder value.
Positive
- Stronger cash generation: 2025 cash provided by operating activities from continuing operations rose to $360 million, and free cash flow increased to $250 million from $72 million in 2024, giving the company more flexibility for debt reduction and potential buybacks.
- Stable, high-quality revenue mix: 2025 revenue of $2,262 million declined only 3.0%, with recurring revenue at 93.2% of total, supporting visibility. Adjusted EBITDA from continuing operations held at $561 million, slightly above $556 million in 2024.
Negative
- Major goodwill impairment and GAAP loss: Alight recorded a $3,124 million non-cash goodwill impairment in 2025, driving a full-year net loss from continuing operations of $3,078 million versus a $140 million loss in 2024, and reducing total assets and equity sharply.
- Dividend elimination and softer top line: The company will replace its cash dividend with deleveraging and possible share repurchases, ending direct cash payouts. 2025 revenue declined 3.0% and fourth quarter revenue fell 4.0%, with gross margin and adjusted gross margin both contracting year over year.
Insights
Large non-cash goodwill impairment drives a big loss while cash generation improves and dividends are replaced by deleveraging and buybacks.
Alight posted $2,262 million of 2025 revenue, down 3.0%, with recurring revenue over 93%, indicating a still-stable base business. The headline result is a $3,078 million loss from continuing operations, almost entirely due to a $3,124 million non-cash goodwill impairment recorded in 2025.
Operationally, profitability was comparatively resilient. Adjusted EBITDA from continuing operations was $561 million, slightly above 2024, and free cash flow rose sharply to $250 million from $72 million. These figures suggest better cash conversion even as reported margins narrowed and project revenue softened.
A notable strategic shift is the plan to replace the cash dividend on Class A shares with deleveraging and potential share repurchases, as of February 19, 2026. The company ended 2025 with $2,005 million of total debt and net debt of $1,732 million, so balance sheet reduction could be meaningful. The actual impact will depend on execution of debt paydown and the scale and timing of any repurchases disclosed in future periods.
8-K Event Classification
3 items: 2.02, 8.01, 9.01
3 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 8.01
Other Events
Other
Voluntary disclosure of events the company deems important to shareholders but not covered by other items.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________________________________________
FORM 8-K
__________________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 19, 2026
__________________________________________
Alight, Inc.
(Exact name of Registrant as Specified in Its Charter)
__________________________________________
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||
| (Address of Principal Executive Offices) | (Zip Code) | |||||||
Registrant’s Telephone Number, Including Area Code: (224) 737-7000
(Former Name or Former Address, if Changed Since Last Report)
__________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Item 2.02 Results of Operations and Financial Condition.
On February 19, 2026, Alight, Inc. (“Alight” or the “Company”) issued a press release announcing its financial results for the fourth quarter and fiscal year ended December 31, 2025. The press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K (this “Report”) and is incorporated herein by reference.
Item 8.01 Other Events.
On February 19, 2026, the Company announced it will replace its cash dividend on its Class A common stock, par value $0.0001 per share, with more efficient capital allocation activities, including deleveraging the balance sheet and, subject to market and other conditions, for share repurchases. The Company believes these are more effective mechanisms to drive long-term shareholder value creation than dividends at the current price levels, as set forth in the press release attached as Exhibit 99.1 to this Report.
Item 9.01 Financial Statements and Exhibits.
(d)Exhibits.
| 99.1 | Press Release of the Company dated as of February 19, 2026 | ||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | ||||
Forward-Looking Statements
This Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, statements related to our capital allocation activities including our potential to deleverage our balance sheet and engage in share repurchases, as well as our ability to drive long-term shareholder value creation. In some cases, these forward-looking statements can be identified by the use of words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “would,” “should,” “could,” “seeks,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties including, among others, risks related to our ability to successfully execute the next phase of our strategic transformation, including our ability to effectively and appropriately separate the Payroll and Professional Services business, risks related to declines in economic activity in the industries, markets, and regions our clients serve, including as a result of macroeconomic factors beyond our control, heightened interest rates or changes in monetary, trade and fiscal policies, competition in our industry, risks related to cyber-attacks and security vulnerabilities and other significant disruptions in our information technology systems and networks, risks related to our ability to maintain the security and privacy of confidential, personal or proprietary data, risks related to actions or proposals from activist stockholders, and risks related to our compliance with applicable laws and regulations, including changes thereto. Additional factors that could cause Alight’s results to differ materially from those described in the forward-looking statements can be found under the section entitled “Risk Factors” of Alight’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission (the "SEC") on February 27, 2025, as such factors may be updated from time to time in Alight's filings with the SEC, which are, or will be, accessible on the SEC's website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be considered along with other factors noted in Alight’s filings with the SEC. Alight undertakes 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.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ALIGHT, INC. | |||||||||||
| Date: | February 19, 2026 | By: | /s/ Martin Felli | ||||||||
| Martin Felli, Chief Legal Officer and Corporate Secretary | |||||||||||
Exhibit 99.1
Alight Reports Fourth Quarter and Full Year 2025 Results
– Fourth quarter revenue of $653 million –
– Full year cash provided by operating activities of $360 million; free cash flow of $250 million –
CHICAGO, IL – February 19, 2026 – Alight, Inc. (NYSE: ALIT), a leading provider of health, wealth, and leave administrative solutions, today reported results for the fourth quarter and full year ended December 31, 2025.
“In 2025, Alight delivered revenue of $2.3 billion, strong cash provided by operating activities, and free cash flow,” said Rohit Verma, Alight’s Chief Executive Officer. “As a leader in the benefits administration space with significant market share across the Fortune 500, our results reflect the Company’s tremendous market recognition with over 30 million people on our platform and $1.7 trillion in assets under administration. Our plan to return to sustainable growth is rooted in our enviable market position and is grounded in three operating principles: deliver service and operational excellence; innovate products that create value and actionable insights; and build relationships that result in enduring, trusted partnerships. These principles are reflected in the high satisfaction rate we achieved during the 2025 annual enrollment season, the favorable response to our recently piloted conversational AI assist agent, and our recent renewals and expansions.”
Presentation of Results
Beginning with the quarter ended March 31, 2024, the Company began accounting for the assets, liabilities and operating results of the Payroll & Professional Services business as discontinued operations. As such, the financial information contained in this release is presented on a continuing operations basis, unless otherwise noted. The Payroll & Professional Services business transaction closed on July 12, 2024.
Fourth Quarter 2025 Highlights (all comparisons are relative to fourth quarter 2024)
•Revenue decreased 4.0% to $653 million
•Gross profit of $240 million and gross profit margin of 36.8%, compared to $271 million and 39.9% in the prior year period, respectively, and adjusted gross profit of $272 million and adjusted gross profit margin of 41.7%, compared to $300 million and 44.1% in the prior year period, respectively
•Net loss of $933 million compared to the prior year period net income of $29 million, primarily driven by a $803 million non-cash goodwill impairment charge
•Adjusted EBITDA of $178 million compared to the prior year period of $217 million
•Diluted earnings (loss) per share of $(1.78) compared to $0.05 in the prior year period, and adjusted diluted earnings per share of $0.18 compared to $0.24 per share in the prior year period
•Declared and paid a $0.04 per share dividend
Full Year 2025 Highlights (all comparisons are relative to full year 2024)
•Revenue decreased 3.0% to $2,262 million
1
•Gross profit of $765 million and gross profit margin of 33.8%, compared to $794 million and 34.0% in the prior year period, respectively, and adjusted gross profit of $883 million and adjusted gross profit margin of 39.0%, compared to $904 million and 38.8% in the prior year period, respectively
•Net loss of $3,078 million compared to the prior year period net loss of $140 million, primarily driven by the $3,124 million non-cash goodwill impairment charge
•Adjusted EBITDA of $561 million compared to the prior year period of $556 million
•Diluted earnings (loss) per share of $(5.83) compared to $(0.25) in the prior year period, and adjusted diluted earnings per share of $0.50 compared to $0.48 per share in the prior year period
•Repurchased $65 million of common stock under existing share repurchase program
Fourth Quarter 2025 Results
Revenue decreased 4.0% to $653 million, as compared to $680 million in the prior year period. The decrease was due to lower project revenue and lower net commercial activity. Recurring revenues were 93.0% of total revenue.
Gross profit was $240 million, or 36.8% of revenue, compared to $271 million, or 39.9% of revenue in the prior year period. The decrease in gross profit was primarily due to lower revenues and an increase in compensation expense.
Selling, general and administrative expenses decreased $37 million when compared to the prior year period. This was due to a reduction in professional fees incurred related to the sale and separation of the Payroll & Professional Services business, lower share based compensation expense and lower restructuring costs.
During the quarter, the Company recognized a non-cash goodwill impairment charge of $803 million after evaluating current business trends and the market valuation of the Company. This non-cash charge does not impact day-to-day operations.
Interest expense of $24 million increased $4 million from the prior year period. The increase was due to higher interest expense net of swaps, lower interest income, partially offset by the benefit of the 2025 debt repricing.
The Company’s loss from continuing operations before income taxes was $713 million compared to income from continuing operations before income taxes of $55 million in the prior year period. The change was primarily attributable to the non-cash goodwill impairment charge partially offset by, the non-operating fair value remeasurement of the tax receivable agreement and lower selling, general and administrative expenses.
Full Year 2025 Results
Revenue decreased 3.0% to $2,262 million, as compared to $2,332 million in the prior year period. The decrease was due to lower net commercial activity and lower project revenue. Recurring revenues were 93.2% of total revenue.
Gross profit was $765 million, or 33.8% of revenue, compared to $794 million, or 34.0% of revenue in the prior year period. The decrease in gross profit was primarily driven by lower revenue as noted above partially offset by productivity savings.
Selling, general and administrative expenses decreased $150 million when compared to the prior year period. This was due to lower professional fees incurred related to the sale and separation of the Payroll and Professional Services business, a reduction in stock based compensation expense and productivity savings.
2
Interest expense of $92 million decreased $11 million from the prior year period. Interest expense benefited from the repricing of the 2028 term loan and the $740 million debt pay down in the third quarter of 2024, partially offset by the Company's hedges and lower interest income.
The Company’s loss from continuing operations before income taxes was $3,062 million compared to loss from continuing operations before income taxes of $148 million in the prior year period. The change was primarily attributable to the non-cash goodwill impairment charge, and the non-operating fair value remeasurements of financial instruments, partially offset by lower selling, general and administrative expenses, a change in fair value remeasurements of the tax receivable agreement and lower interest expense as a result of the debt pay down.
Balance Sheet Highlights
As of December 31, 2025, the Company’s cash and cash equivalents balance was $273 million, total debt was $2,005 million and total debt net of cash and cash equivalents was $1,732 million.
Subsequent Event
The Company announces it will replace its cash dividend with more efficient capital allocation activities, including deleveraging the balance sheet and, subject to market and other conditions, for share repurchases. The Company believes that these are more effective mechanisms to drive long-term shareholder value creation than dividends at the current price levels.
Earnings Conference Call and Webcast Information
A conference call to discuss the Company’s fourth quarter and full year 2025 financial results is scheduled for today, February 19, 2026 at 7:30 a.m. Central Time (8:30 a.m. Eastern Time). Interested parties can access the live webcast and accompanying presentation materials by logging on to the Investor Relations section on the Company’s website at http://investor.alight.com. A replay of the conference call and the accompanying presentation materials will be available on the investor relations website for approximately 90 days.
About Alight Solutions
Alight is a leading provider of health, wealth, and leave administrative solutions for many of the world’s largest organizations and over 30 million people. Through the administration of employee benefits, Alight helps clients gain a benefits advantage while building a healthy and financially secure workforce by unifying the benefits ecosystem across health, wealth, wellbeing, absence management and navigation. Our Alight Worklife® platform empowers employers to gain a deeper understanding of their workforce and engage them throughout life’s most important moments with personalized benefits management and data-driven insights, leading to increased employee wellbeing, engagement and productivity. Learn more about the Alight Benefits Advantage™ at alight.com.
Contacts
Investors:
investor.relations@alight.com
Media:
Mariana Fischbach
mariana.fischbach@alight.com
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, statements related to our capital allocation activities including our potential to deleverage our balance sheet and engage in share repurchases,
3
as well as our ability to drive long-term shareholder value creation. In some cases, these forward-looking statements can be identified by the use of words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “would,” “should,” “could,” “seeks,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties including, among others, risks related to our ability to successfully execute the next phase of our strategic transformation, including our ability to effectively and appropriately separate the Payroll and Professional Services business, risks related to declines in economic activity in the industries, markets, and regions our clients serve, including as a result of macroeconomic factors beyond our control, heightened interest rates or changes in monetary, trade and fiscal policies, competition in our industry, risks related to cyber-attacks and security vulnerabilities and other significant disruptions in our information technology systems and networks, risks related to our ability to maintain the security and privacy of confidential, personal or proprietary data, risks related to actions or proposals from activist stockholders, and risks related to our compliance with applicable laws and regulations, including changes thereto. Additional factors that could cause Alight’s results to differ materially from those described in the forward-looking statements can be found under the section entitled “Risk Factors” of Alight’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission (the "SEC") on February 27, 2025, as such factors may be updated from time to time in Alight's filings with the SEC, which are, or will be, accessible on the SEC's website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be considered along with other factors noted in this press release and in Alight’s filings with the SEC. Alight undertakes 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.
Non-GAAP Financial Measures and Other Information
The Company refers to certain non-GAAP financial measures in this press release, including: Adjusted EBITDA From Continuing Operations, Adjusted EBITDA Margin From Continuing Operations, Adjusted Net Income From Continuing Operations, Adjusted Diluted Earnings Per Share From Continuing Operations, Free Cash Flow, Adjusted Gross Profit and Adjusted Gross Profit Margin. Please see below for additional information and for reconciliations of such non-GAAP financial measures. The presentation of non-GAAP financial measures is used to enhance our investors’ and lenders’ understanding of certain aspects of our financial performance. This discussion is not meant to be considered in isolation, superior to, or as a substitute for the directly comparable financial measures prepared in accordance with GAAP.
Adjusted EBITDA From Continuing Operations, which is defined as earnings from continuing operations before interest, taxes, depreciation and intangible amortization adjusted for the impact of certain non-cash and other items, including goodwill impairments, that we do not consider in the evaluation of ongoing operational performance. Adjusted EBITDA Margin From Continuing Operations is defined as Adjusted EBITDA From Continuing Operations divided by revenue. Both Adjusted EBITDA From Continuing Operations and Adjusted EBITDA Margin From Continuing Operations are non-GAAP financial measures used by management and our stakeholders to provide useful supplemental information that enables a better comparison of our performance across periods as well as to evaluate our core operating performance.
Adjusted Net Income From Continuing Operations, which is defined as net income (loss) from continuing operations adjusted for intangible amortization and the impact of certain non-cash items, including goodwill impairments, that we do not consider in the evaluation of ongoing operational performance, is a non-GAAP financial measure used solely for the purpose of calculating Adjusted Diluted Earnings Per Share From Continuing Operations.
Adjusted Diluted Earnings Per Share From Continuing Operations is defined as Adjusted Net Income From Continuing Operations divided by the adjusted weighted-average number of shares of Alight Inc. common stock, diluted. Adjusted Diluted Earnings Per Share From Continuing Operations is used by us and our investors to evaluate our core operating performance and to benchmark our operating performance against our competitors.
4
Free Cash Flow is defined as cash provided by operating activities net of capital expenditures. Management believes that free cash flow is an important liquidity metric because it measures, during a given period, the amount of cash generated that is available to repay debt obligations, make strategic acquisitions and investments and for certain other activities such as dividends and stock repurchases.
Adjusted Gross Profit is defined as revenue less cost of services adjusted for depreciation, amortization and share-based compensation, and Adjusted Gross Profit Margin is defined as Adjusted Gross Profit divided by revenue. Management uses Adjusted Gross Profit and Adjusted Gross Profit Margin as key measures in making financial, operating and planning decisions and in evaluating our performance. We believe that presenting Adjusted Gross Profit and Adjusted Gross Profit Margin is useful to investors as it eliminates the impact of certain non-cash expenses and allows a direct comparison between periods.
Revenue Under Contract is an operational metric that represents management’s estimate of anticipated revenue expected to be recognized in the period referenced based on available information that includes historical client contracting practices. The metric does not reflect potential future events such as unexpected client volume fluctuations, early contract terminations or early contract renewals. Our metric may differ from similar terms used by other companies and, therefore, comparability may be limited.
5
Condensed Consolidated Statements of Income (Loss)
(Unaudited)
| Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
| (in millions, except per share amounts) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Revenue | $ | 653 | $ | 680 | $ | 2,262 | $ | 2,332 | |||||||||||||||
| Cost of services, exclusive of depreciation and amortization | 383 | 383 | 1,386 | 1,442 | |||||||||||||||||||
| Depreciation and amortization | 30 | 26 | 111 | 96 | |||||||||||||||||||
| Gross Profit | 240 | 271 | 765 | 794 | |||||||||||||||||||
| Operating Expenses | |||||||||||||||||||||||
| Selling, general and administrative | 114 | 151 | 435 | 585 | |||||||||||||||||||
| Depreciation and intangible amortization | 73 | 76 | 296 | 299 | |||||||||||||||||||
| Goodwill impairment | 803 | — | 3,124 | — | |||||||||||||||||||
| Total Operating expenses | 990 | 227 | 3,855 | 884 | |||||||||||||||||||
| Operating Income (Loss) From Continuing Operations | (750) | 44 | (3,090) | (90) | |||||||||||||||||||
| Other (Income) Expense | |||||||||||||||||||||||
| (Gain) Loss from change in fair value of financial instruments | (2) | (3) | (1) | (57) | |||||||||||||||||||
| (Gain) Loss from change in fair value of tax receivable agreement | (59) | (17) | (93) | 34 | |||||||||||||||||||
| Interest expense | 24 | 20 | 92 | 103 | |||||||||||||||||||
| Other (income) expense, net | — | (11) | (26) | (22) | |||||||||||||||||||
| Total Other (income) expense, net | (37) | (11) | (28) | 58 | |||||||||||||||||||
| Income (Loss) From Continuing Operations Before Taxes | (713) | 55 | (3,062) | (148) | |||||||||||||||||||
| Income tax expense (benefit) | 220 | 26 | 16 | (8) | |||||||||||||||||||
| Net Income (Loss) From Continuing Operations | (933) | 29 | (3,078) | (140) | |||||||||||||||||||
| Net Income (Loss) From Discontinued Operations, Net of Tax | 1 | (21) | (21) | (19) | |||||||||||||||||||
| Net Income (Loss) | (932) | 8 | (3,099) | (159) | |||||||||||||||||||
| Net income (loss) attributable to noncontrolling interests | — | — | (2) | (2) | |||||||||||||||||||
| Net Income (Loss) Attributable to Alight, Inc. | $ | (932) | $ | 8 | $ | (3,097) | $ | (157) | |||||||||||||||
| Earnings (Loss) Per Share | |||||||||||||||||||||||
| Basic and Diluted | |||||||||||||||||||||||
| Continuing operations | $ | (1.78) | $ | 0.05 | $ | (5.83) | $ | (0.25) | |||||||||||||||
| Discontinued operations | $ | 0.00 | $ | (0.04) | $ | (0.04) | $ | (0.04) | |||||||||||||||
| Net Income (Loss) | $ | (1.78) | $ | 0.01 | $ | (5.87) | $ | (0.29) | |||||||||||||||
6
Condensed Consolidated Balance Sheets
(Unaudited)
| December 31, 2025 | December 31, 2024 | ||||||||||
| (in millions, except par values) | |||||||||||
| Assets | |||||||||||
| Current Assets | |||||||||||
| Cash and cash equivalents | $ | 273 | $ | 343 | |||||||
| Receivables, net | 387 | 471 | |||||||||
| Other current assets | 234 | 214 | |||||||||
| Fiduciary assets | 248 | 239 | |||||||||
| Total Current Assets | 1,142 | 1,267 | |||||||||
| Goodwill | 83 | 3,212 | |||||||||
| Intangible assets, net | 2,573 | 2,855 | |||||||||
| Fixed assets, net | 378 | 396 | |||||||||
| Deferred tax assets, net | 15 | 41 | |||||||||
| Other assets | 377 | 422 | |||||||||
| Total Assets | $ | 4,568 | $ | 8,193 | |||||||
| Liabilities and Stockholders' Equity | |||||||||||
| Liabilities | |||||||||||
| Current Liabilities | |||||||||||
| Accounts payable and accrued liabilities | $ | 253 | $ | 355 | |||||||
| Current portion of long-term debt, net | 20 | 25 | |||||||||
| Other current liabilities | 353 | 273 | |||||||||
| Fiduciary liabilities | 248 | 239 | |||||||||
| Total Current Liabilities | 874 | 892 | |||||||||
| Deferred tax liabilities | 14 | 22 | |||||||||
| Long-term debt, net | 1,985 | 2,000 | |||||||||
| Long-term tax receivable agreement | 508 | 757 | |||||||||
| Financial instruments | — | 51 | |||||||||
| Other liabilities | 141 | 158 | |||||||||
| Total Liabilities | $ | 3,522 | $ | 3,880 | |||||||
| Commitments and Contingencies | |||||||||||
| Stockholders' Equity | |||||||||||
Preferred stock at $0.0001 par value: 1.0 shares authorized, none issued and outstanding | $ | — | $ | — | |||||||
Class A Common Stock: $0.0001 par value, 1,000.0 shares authorized; 566.5 and 560.5 shares issued, and 523.9 and 531.7 shares outstanding as of December 31, 2025 and December 31, 2024, respectively | — | — | |||||||||
Class B Common Stock: $0.0001 par value, 20.0 shares authorized; 9.9 and 10.0 issued and outstanding as of December 31, 2025 and December 31, 2024, respectively | — | — | |||||||||
Class V Common Stock: $0.0001 par value, 175.0 shares authorized; 0.5 and 0.5 issued and outstanding as of December 31, 2025 and December 31, 2024, respectively | — | — | |||||||||
Class Z Common Stock: $0.0001 par value, 12.9 shares authorized; none issued and outstanding | — | — | |||||||||
Treasury stock, at cost (42.6 and 28.8 shares at December 31, 2025 and December 31, 2024, respectively) | (284) | (219) | |||||||||
| Additional paid-in-capital | 5,065 | 5,141 | |||||||||
| Accumulated deficit | (3,757) | (660) | |||||||||
| Accumulated other comprehensive income | 20 | 47 | |||||||||
| Total Alight, Inc. Stockholders' Equity | $ | 1,044 | $ | 4,309 | |||||||
| Noncontrolling interest | 2 | 4 | |||||||||
| Total Stockholders' Equity | $ | 1,046 | $ | 4,313 | |||||||
| Total Liabilities and Stockholders' Equity | $ | 4,568 | $ | 8,193 | |||||||
7
Condensed Consolidated Statements of Cash Flows
(Unaudited)
| Year Ended December 31, | |||||||||||
| (in millions) | 2025 | 2024 | |||||||||
| Operating activities: | |||||||||||
| Net Income (Loss) From Continuing Operations | $ | (3,078) | $ | (140) | |||||||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||
| Depreciation | 126 | 115 | |||||||||
| Intangible asset amortization | 281 | 280 | |||||||||
| Noncash lease expense | 7 | 11 | |||||||||
| Financing fee and premium amortization | 2 | — | |||||||||
| Share-based compensation expense | 19 | 76 | |||||||||
| (Gain) loss from change in fair value of financial instruments | (1) | (57) | |||||||||
| (Gain) loss from change in fair value of tax receivable agreement | (93) | 34 | |||||||||
| Release of unrecognized tax provision | — | (1) | |||||||||
| Deferred tax expense (benefit) | 8 | (19) | |||||||||
| Goodwill impairment | 3,124 | — | |||||||||
| Other | 15 | (1) | |||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable | 84 | (37) | |||||||||
| Accounts payable and accrued liabilities | (90) | 31 | |||||||||
| Other assets and liabilities | (44) | (99) | |||||||||
| Cash provided by operating activities - continuing operations | 360 | 193 | |||||||||
| Cash provided by operating activities - discontinued operations | — | 59 | |||||||||
| Net cash provided by operating activities | $ | 360 | $ | 252 | |||||||
| Investing activities: | |||||||||||
| Net proceeds from sale of business | (13) | 968 | |||||||||
| Capital expenditures | (110) | (121) | |||||||||
| Cash provided by (used in) investing activities - continuing operations | (123) | 847 | |||||||||
| Cash used in investing activities - discontinued operations | — | (11) | |||||||||
| Net cash provided by (used in) investing activities | $ | (123) | $ | 836 | |||||||
| Financing activities: | |||||||||||
| Dividend payments | (86) | (21) | |||||||||
| Net increase (decrease) in fiduciary liabilities | 9 | 5 | |||||||||
| Repayments to banks | (20) | (765) | |||||||||
| Principal payments on finance lease obligations | (22) | (27) | |||||||||
| Payments on tax receivable agreements | (100) | (62) | |||||||||
| Tax payment for shares/units withheld in lieu of taxes | (12) | (59) | |||||||||
| Repurchase of shares | (65) | (167) | |||||||||
| Other financing activities | (2) | — | |||||||||
| Cash used for financing activities - continuing operations | (298) | (1,096) | |||||||||
| Cash provided by (used in) financing activities - discontinued operations | — | 22 | |||||||||
| Net Cash provided by (used in) financing activities | $ | (298) | $ | (1,074) | |||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash - continuing operations | — | 1 | |||||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash - discontinued operations | — | (3) | |||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | (61) | 12 | |||||||||
| Cash, cash equivalents and restricted cash balances from: | |||||||||||
| Continuing operations - beginning of year | $ | 582 | $ | 558 | |||||||
| Discontinued operations - beginning of year | — | 1,201 | |||||||||
| Less fiduciary cash transferred with sale of business | — | 1,189 | |||||||||
| Continuing operations - end of period | $ | 521 | $ | 582 | |||||||
8
Reconciliation of Net Income (Loss) From Continuing Operations to Adjusted EBITDA from Continuing Operations (Unaudited)
| Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Net Income (Loss) From Continuing Operations | $ | (933) | $ | 29 | $ | (3,078) | $ | (140) | |||||||||||||||
| Interest expense | 24 | 20 | 92 | 103 | |||||||||||||||||||
| Income tax expense (benefit) | 220 | 26 | 16 | (8) | |||||||||||||||||||
| Depreciation | 33 | 32 | 126 | 115 | |||||||||||||||||||
| Intangible amortization | 70 | 70 | 281 | 280 | |||||||||||||||||||
| EBITDA From Continuing Operations | (586) | 177 | (2,563) | 350 | |||||||||||||||||||
| Share-based compensation | 5 | 17 | 19 | 76 | |||||||||||||||||||
Transaction and integration expenses (1) | 4 | 25 | 16 | 82 | |||||||||||||||||||
| Restructuring | 11 | 18 | 55 | 63 | |||||||||||||||||||
| (Gain) Loss from change in fair value of financial instruments | (2) | (3) | (1) | (57) | |||||||||||||||||||
| (Gain) Loss from change in fair value of tax receivable agreement | (59) | (17) | (93) | 34 | |||||||||||||||||||
Goodwill impairment and other (2) | 805 | — | 3,128 | 8 | |||||||||||||||||||
Adjusted EBITDA From Continuing Operations (3) | $ | 178 | $ | 217 | $ | 561 | $ | 556 | |||||||||||||||
| Revenue | $ | 653 | $ | 680 | $ | 2,262 | $ | 2,332 | |||||||||||||||
Adjusted EBITDA Margin From Continuing Operations (4) | 27.3 | % | 31.9 | % | 24.8 | % | 23.8 | % | |||||||||||||||
(1)Transaction and integration expenses primarily relate to acquisition and divestiture activities.
(2)Goodwill impairment and other primarily includes $3,124 non-cash goodwill impairment charges for the year ended December 31, 2025.
(3)Adjusted EBITDA excludes the impact of discontinued operation.
(4)Adjusted EBITDA Margin From Continuing Operations is defined as Adjusted EBITDA From Continuing Operations as a percentage of revenue.
9
Reconciliation of Net Income (Loss) From Continuing Operations to Adjusted Net Income and Adjusted Diluted Earnings per Share From Continuing Operations (Unaudited)
| Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| (in millions, except share and per share amounts) | |||||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||
Net Income (Loss) From Continuing Operations Attributable to Alight, Inc. (1) | $ | (933) | $ | 29 | $ | (3,076) | $ | (138) | |||||||||||||||
| Conversion of noncontrolling interest | — | — | (2) | (2) | |||||||||||||||||||
| Intangible amortization | 70 | 70 | 281 | 280 | |||||||||||||||||||
| Share-based compensation | 5 | 17 | 19 | 76 | |||||||||||||||||||
Transaction and integration expenses (2) | 4 | 25 | 16 | 82 | |||||||||||||||||||
| Restructuring | 11 | 18 | 55 | 63 | |||||||||||||||||||
| (Gain) Loss from change in fair value of financial instruments | (2) | (3) | (1) | (57) | |||||||||||||||||||
| (Gain) Loss from change in fair value of tax receivable agreement | (59) | (17) | (93) | 34 | |||||||||||||||||||
Goodwill impairment and other (3) | 805 | — | 3,128 | 8 | |||||||||||||||||||
Tax effect of adjustments (4) | 195 | (12) | (61) | (85) | |||||||||||||||||||
| Adjusted Net Income From Continuing Operations | $ | 96 | $ | 127 | $ | 266 | $ | 261 | |||||||||||||||
| Denominator: | |||||||||||||||||||||||
| Weighted average shares outstanding - basic | 523,003,557 | 532,282,913 | 527,567,685 | 539,861,208 | |||||||||||||||||||
| Dilutive effect of the exchange of noncontrolling interest units | — | 510,237 | — | 510,237 | |||||||||||||||||||
| Dilutive effect of RSUs | — | 1,287,553 | — | — | |||||||||||||||||||
| Weighted average shares outstanding - diluted | 523,003,557 | 534,080,703 | 527,567,685 | 540,371,445 | |||||||||||||||||||
Exchange of noncontrolling interest units(5) | 494,717 | 28,080 | 506,234 | 518,412 | |||||||||||||||||||
Impact of unvested RSUs(6) | 7,617,889 | 6,037,553 | 7,617,889 | 7,325,106 | |||||||||||||||||||
Adjusted shares of Class A Common Stock outstanding - diluted(7)(8) | 531,116,163 | 540,146,336 | 535,691,808 | 548,214,963 | |||||||||||||||||||
| Basic (Net Loss) Earnings Per Share From Continuing Operations | $ | (1.78) | $ | 0.05 | $ | (5.83) | $ | (0.25) | |||||||||||||||
| Diluted (Net Loss) Earnings Per Share From Continuing Operations | $ | (1.78) | $ | 0.05 | $ | (5.83) | $ | (0.25) | |||||||||||||||
| Adjusted Diluted Earnings Per Share From Continuing Operations | $ | 0.18 | $ | 0.24 | $ | 0.50 | $ | 0.48 | |||||||||||||||
(1)Excludes the impact of discontinued operations.
(2)Transaction and integration expenses primarily relate to acquisition and divestiture activities.
(3)Goodwill impairment and other primarily includes $3,124 million non-cash goodwill impairment charges for the year ended December 31, 2025.
(4)Income tax effects have been calculated based on the statutory tax rates for both U.S. and foreign jurisdictions based on the Company's mix of income and adjusted for significant changes in fair value measurement.
(5)Assumes the full exchange of the units held by noncontrolling interests for shares of Class A Common Stock of Alight, Inc. pursuant to the exchange agreement.
(6)Includes non-vested time-based restricted stock units that were determined to be antidilutive for U.S. GAAP diluted earnings per share purposes.
(7)Excludes two tranches of contingently issuable seller earnout shares: (i) 7.5 million shares will be issued if the Company's Class A Common Stock's volume-weighted average price ("VWAP") is >$12.50 for any 20 trading days within a consecutive period of 30 trading days; (ii) 7.5 million shares will be issued if the Company's Class A Common Stock VWAP is >$15.00 for any 20 trading days within a consecutive period of 30 trading days. Both tranches have a seven-year duration.
(8)Excludes approximately 0.7 million and 10.9 million performance-based units, which represents the gross number of shares expected to vest based on achievement of performance conditions as of December 31, 2025 and 2024, respectively.
10
Gross Profit to Adjusted Gross Profit Reconciliation
(Unaudited)
| Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
| ($ in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Gross Profit | $ | 240 | $ | 271 | $ | 765 | $ | 794 | |||||||||||||||
| Add: stock-based compensation | 2 | 3 | 7 | 14 | |||||||||||||||||||
| Add: depreciation and amortization | 30 | 26 | 111 | 96 | |||||||||||||||||||
| Adjusted Gross Profit | $ | 272 | $ | 300 | $ | 883 | $ | 904 | |||||||||||||||
| Gross Profit Margin | 36.8 | % | 39.9 | % | 33.8 | % | 34.0 | % | |||||||||||||||
| Adjusted Gross Profit Margin | 41.7 | % | 44.1 | % | 39.0 | % | 38.8 | % | |||||||||||||||
Free Cash Flow Reconciliation
(Unaudited)
| Year Ended December 31, | |||||||||||
| ($ in millions) | 2025 | 2024 | |||||||||
| Non-GAAP free cash flow reconciliation: | |||||||||||
| Cash provided by operating activities - continuing operations | $ | 360 | $ | 193 | |||||||
| Capital expenditures | (110) | (121) | |||||||||
| Non-GAAP free cash flow | $ | 250 | $ | 72 | |||||||
Other Select Financial Data
(Unaudited)
| Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
| ($ in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Revenue Disaggregation | |||||||||||||||||||||||
| Recurring | $ | 607 | $ | 617 | $ | 2,108 | $ | 2,135 | |||||||||||||||
| Project | 46 | 63 | 154 | 197 | |||||||||||||||||||
| Total revenue | $ | 653 | $ | 680 | $ | 2,262 | $ | 2,332 | |||||||||||||||
| BPaaS revenue | $ | 166 | $ | 146 | $ | 539 | $ | 499 | |||||||||||||||
| Gross Profit | |||||||||||||||||||||||
| Total gross profit | $ | 240 | $ | 271 | $ | 765 | $ | 794 | |||||||||||||||
| Total gross margin | 36.8 | % | 39.9 | % | 33.8 | % | 34.0 | % | |||||||||||||||
| Adjusted Gross Profit | |||||||||||||||||||||||
| Total adjusted gross profit | $ | 272 | $ | 300 | $ | 883 | $ | 904 | |||||||||||||||
| Total adjusted gross margin percent | 41.7 | % | 44.1 | % | 39.0 | % | 38.8 | % | |||||||||||||||
| Adjusted EBITDA From Continuing Operations | |||||||||||||||||||||||
| Adjusted EBITDA From Continuing Operations | $ | 178 | $ | 217 | $ | 561 | $ | 556 | |||||||||||||||
| Adjusted EBITDA Margin From Continuing Operations | 27.3 | % | 31.9 | % | 24.8 | % | 23.8 | % | |||||||||||||||
| Free Cash Flow | |||||||||||||||||||||||
| Free Cash Flow From Continuing Operations | $ | 250 | $ | 72 | |||||||||||||||||||
11
FAQ
How did Alight (ALIT) perform financially in full-year 2025?
Alight reported 2025 revenue of $2,262 million, down 3.0% from 2024, with recurring revenue at 93.2% of total. It recorded a $3,078 million net loss from continuing operations, largely due to a $3,124 million non-cash goodwill impairment charge.
What were Alight’s (ALIT) fourth quarter 2025 results?
In fourth quarter 2025, Alight generated revenue of $653 million, down 4.0% from the prior year’s $680 million. Gross profit was $240 million, and the company reported a net loss from continuing operations of $933 million, mainly driven by an $803 million goodwill impairment.
Why did Alight (ALIT) report such a large net loss in 2025?
The 2025 net loss from continuing operations of $3,078 million was primarily caused by a $3,124 million non-cash goodwill impairment. This accounting charge reduced reported earnings but did not affect cash flow or day-to-day operations, which remained positive at the adjusted EBITDA and free cash flow levels.
What is Alight (ALIT) changing about its dividend and capital allocation?
Alight plans to replace its cash dividend on Class A common stock with a focus on deleveraging the balance sheet and, subject to market and other conditions, share repurchases. Management believes these uses of cash better support long-term shareholder value at current price levels.
How strong was Alight’s (ALIT) cash flow and leverage at the end of 2025?
For 2025, Alight generated $360 million of cash from operating activities from continuing operations and $250 million of free cash flow. As of December 31, 2025, it held $273 million in cash and cash equivalents and had total debt of $2,005 million, implying net debt of $1,732 million.
What were Alight’s (ALIT) key profitability metrics in 2025?
Alight reported 2025 gross profit of $765 million with a gross margin of 33.8%, slightly below 2024. Adjusted gross profit was $883 million with a 39.0% margin, and adjusted EBITDA from continuing operations reached $561 million, for a 24.8% adjusted EBITDA margin.