Financial Data and Key Metrics Changes - In Q4 2025, net sales were $631 million, a decrease of 5.7% compared to Q4 2024, excluding the divestiture of European operations [24] - For the full year 2025, net sales were $2.4 billion, a 4.8% decline compared to 2024, also excluding the European divestiture [24] - Adjusted EBITDA for Q4 2025 was $55 million, down from $63 million in Q4 2024, while full-year adjusted EBITDA was $196 million, compared to $224 million in 2024 [26] - Adjusted diluted earnings per share for Q4 2025 was $0.36, consistent with Q4 2024, while full-year adjusted diluted earnings per share increased by 19% to $1.01 [26] Business Line Data and Key Metrics Changes - Targeted print categories, including direct mail and packaging, experienced net sales growth, while traditional print product lines like magazines and catalogs saw declines [4][25] - The QuadMed employer-sponsored healthcare business also showed revenue increases, offsetting declines in logistics and agency sales [25] Market Data and Key Metrics Changes - The company reported a significant increase in co-mail volumes by over 50%, enhancing carrier route density levels and achieving postal savings [57] - The postal service is expected to implement a mid-year rate increase of 6%-8%, which could impact marketing spend [80] Company Strategy and Development Direction - The company is focused on revenue diversification and has made targeted investments in artificial intelligence to drive efficiency and effectiveness in marketing solutions [4][19] - Quad aims to return to net sales growth by 2028, with a strategic emphasis on integrated marketing solutions and targeted print offerings [4][42] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the operating environment, noting increased confidence among clients and a potential for reinvestment [75] - The company is closely monitoring inflationary pressures and postal rate increases, which could affect marketing spend [40] Other Important Information - The company increased its quarterly dividend by 33% to $0.10 per share, reflecting a commitment to shareholder returns [5][31] - A significant transition in the manufacturing network was announced, with the closure of a plant in Thomaston, Georgia, expected to be completed by early March [22] Q&A Session Summary Question: Insights on direct mail performance and future trends - Management clarified the distinction between direct mail as a product and the direct marketing agency, emphasizing the importance of personalized, data-driven approaches to enhance response rates [47][48] Question: Impact of postal rate increases on catalogs - Management noted that while catalogs have been responsive, the significant increases in postal rates have led to further declines in catalog usage, particularly in prospecting mailings [56] Question: Updates on In-Store Connect and future deployments - Management indicated that there has been an acceleration in conversations and opportunities regarding In-Store Connect, with plans for further rollouts [60] Question: Factors influencing 2026 sales and Adjusted EBITDA guidance - Management highlighted that postal impacts and the momentum in targeted print categories will influence the sales trend, with expectations for improved margins as the revenue mix evolves [66][67] Question: Capital allocation strategy moving forward - Management confirmed a balanced approach to capital allocation, focusing on shareholder returns, potential tuck-in acquisitions, and growth investments [68][69]

Quad/Graphics (NYSE:QUAD) Q4 2025 Earnings call February 18, 2026 08:30 AM ET Company ParticipantsJoel Quadracci - Chairman and CEOJulie Currie - EVP and Chief Revenue OfficerTony Staniak - CFO and TreasurerConference Call ParticipantsBarton Crockett - Managing Director and Senior Research AnalystKevin Steinke - Equity Research AnalystOperatorA slide presentation accompanies today's webcast, and participants are invited to follow along, advancing the slides themselves. To access the webcast, follow the inst ...

Financial Data and Key Metrics Changes - In Q4 2025, net sales were $631 million, a decrease of 5.7% compared to Q4 2024, excluding the divestiture of European operations [22] - For the full year 2025, net sales were $2.4 billion, a 4.8% decline compared to 2024, also excluding the European divestiture [22] - Adjusted EBITDA for Q4 2025 was $55 million, down from $63 million in Q4 2024, while full-year adjusted EBITDA was $196 million, compared to $224 million in 2024 [23][24] - Adjusted diluted earnings per share for Q4 2025 was $0.36, consistent with Q4 2024, while full-year adjusted diluted earnings per share increased by 19% to $1.01 [24] - Free cash flow was $51 million in 2025, down from $56 million in 2024, primarily due to a decrease in net cash from operating activities [26] Business Line Data and Key Metrics Changes - Targeted print categories, including direct mail, packaging, and in-store marketing, experienced net sales growth, while traditional print product lines like magazines and catalogs saw declines [4][22] - The direct mail segment outperformed expectations in 2025, driven by higher volumes and operational efficiencies [4][45] - The QuadMed employer-sponsored healthcare business also saw an increase in revenue mix as a percentage of total net sales [22] Market Data and Key Metrics Changes - The company noted a significant impact from postal rate increases, which have affected the catalog segment, leading to further declines in volume [52][54] - The new Postmaster General's approach aims for growth rather than just revenue through price increases, which could positively influence the catalog market in the future [53] Company Strategy and Development Direction - The company is focused on revenue diversification and has made targeted investments in artificial intelligence to enhance marketing efficiency and effectiveness [5][18] - Quad is expanding its integrated marketing platform, which combines creative, production, and media solutions across physical and digital channels, creating a competitive advantage [5][6] - The company anticipates a return to net sales growth by 2028, with a focus on improving adjusted EBITDA margins and free cash flow conversion [4][40][41] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's ability to navigate the current operating environment, emphasizing the importance of maintaining a disciplined approach to cost management [38] - The company expects to see improved sales trends in 2026, with a focus on targeted print categories and continued investment in growth initiatives [33][34] - Management acknowledged potential challenges from tariffs and inflation but remains committed to adapting to changing market conditions [38] Other Important Information - The company increased its quarterly dividend by 33% to $0.10 per share, reflecting a commitment to shareholder returns [5][29] - Quad's net debt leverage ratio was 1.57x as of December 31, 2025, with a goal to maintain a low leverage ratio while pursuing growth investments [28][30] Q&A Session Summary Question: Can you provide insights on the growth trends in direct mail and its momentum into 2026? - Management clarified the difference between direct mail as a product and the direct marketing agency's role, emphasizing the importance of data-driven personalization to enhance response rates [45][46] Question: Have you seen any impact from the delayed postal rate increase on catalogs or other channels? - Management noted that while there has been no growth in catalogs, they have managed to offset some declines through increased co-mail volumes and postal savings [54][55] Question: What is the current status of In-Store Connect and its rollout? - Management indicated that there has been an acceleration in conversations and opportunities related to In-Store Connect, with capital reserved for growth in this area [57][59] Question: What factors are influencing the guidance ranges for sales and Adjusted EBITDA in 2026? - Management highlighted the impact of postal rates and the momentum in targeted print categories as key factors influencing the guidance ranges [63][64] Question: How will capital allocation be balanced moving forward? - Management stated that capital allocation will continue to be balanced, with a focus on growth investments, share repurchases, and maintaining low debt leverage [66][68]

February 18, 2026 The factors that could cause actual results to materially differ include, among others: the impact of increased business complexity as a result of the Company's transformation to a marketing experience company, including adapting marketing offerings and business processes as required by new markets; the impact of decreasing demand for printing services and significant overcapacity in a highly competitive environment creating downward pricing pressures and potential under-utilization of ass ...

Financial Data and Key Metrics Changes - Net sales for Q3 2025 were $588 million, a decrease of 7% compared to Q3 2024, excluding a 6% impact from the divestiture of European operations [21] - Adjusted EBITDA was $53 million in Q3 2025, down from $59 million in Q3 2024, with an adjusted EBITDA margin improving from 8.7% to 8.9% year-to-date [22] - Adjusted diluted earnings per share increased by 19% to $0.31 in Q3 2025 from $0.26 in Q3 2024 [23] - Free cash flow improved by $5 million to -$87 million for the nine months ended September 30, 2025 [24] Business Line Data and Key Metrics Changes - Targeted print offerings increased by 2% as a percentage of total net sales, driven by growth in direct marketing, packaging, and in-store solutions [21] - Direct mail revenue increased by over 6%, packaging by over 9%, and in-store solutions by 11% year-to-date [38] Market Data and Key Metrics Changes - The company continues to monitor macroeconomic pressures such as inflation and high postage costs, which may impact clients' marketing plans [5][6] - The USPS announced no price increase for market-dominant mail in January, which is seen as favorable for marketers [7][39] Company Strategy and Development Direction - The company is investing in AI-powered tools and systems, data and audience intelligence services, and its In-Store Connect retail media network to diversify revenue and return to net sales growth by 2028 [4] - The strategic focus is on maximizing savings for clients while increasing marketing effectiveness through innovative solutions [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future growth of In-Store Connect, citing strong sales lift results from campaigns [16][17] - The company anticipates a similar seasonal pattern for free cash flow and net debt, expecting significant positive cash flow in Q4 2025 [24][29] Other Important Information - The company returned $19 million of capital to shareholders year-to-date through dividends and share repurchases [26] - The adjusted EBITDA guidance for 2025 has been narrowed to between $190 million and $200 million [29] Q&A Session Summary Question: Trends in targeted print categories - Management noted that catalog sales are muted due to postal increases, while direct mail, packaging, and in-store solutions are seeing growth [38] Question: Impact of USPS postponing price increase - Management indicated that the postponement is positive, but concerns remain about future postal rate increases [39][60] Question: Updated guidance ranges - Management discussed variability in direct mail and reaffirmed the midpoint of the sales outlook for Q4 [43][46] Question: In-Store Connect deployment updates - Management reported increased interest from clients and a strong pipeline for In-Store Connect, with positive feedback from recent industry events [49][50]

Financial Data and Key Metrics Changes - Net sales for Q3 2025 were $588 million, a decrease of 7% compared to Q3 2024, excluding a 6% impact from the divestiture of European operations [20] - Adjusted EBITDA for Q3 2025 was $53 million, down from $59 million in Q3 2024, while the adjusted EBITDA margin improved from 8.7% to 8.9% year-to-date [21] - Adjusted diluted earnings per share increased by 19% to $0.31 in Q3 2025 from $0.26 in Q3 2024, and year-to-date adjusted diluted earnings per share rose by 33% to $0.65 in 2025 from $0.49 in 2024 [22] Business Line Data and Key Metrics Changes - Targeted print offerings increased by 2% as a percentage of total net sales, driven by growth in direct marketing, packaging, and in-store solutions [21] - Direct mail revenue increased by over 6% year-to-date, packaging grew over 9%, and in-store solutions rose by 11% year-to-date [36] Market Data and Key Metrics Changes - The company continues to monitor macroeconomic pressures such as inflation and high postage costs, which may impact clients' marketing plans [5] - The USPS announced it would not issue a January price increase for market-dominant mail, which is seen as positive news for marketers [7] Company Strategy and Development Direction - The company is investing in AI-powered tools and systems, data and audience intelligence services, and its In-Store Connect retail media network to diversify revenue and return to net sales growth by 2028 [4] - The strategic focus is on maximizing savings for clients while increasing marketing effectiveness through innovative solutions [8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future growth of In-Store Connect, citing strong results from CPG campaigns and a growing pipeline of clients [17] - The company anticipates a seasonal pattern for free cash flow, expecting a significant positive cash flow in Q4 2025 [23] Other Important Information - The company returned $19 million of capital to shareholders year-to-date through dividends and share repurchases [25] - The adjusted EBITDA guidance for 2025 has been narrowed to between $190 million and $200 million, with free cash flow expected to be at the higher end of the original guidance range [29] Q&A Session Summary Question: Trends in targeted print categories - Management noted that catalog sales are muted due to postal increases, while direct mail, packaging, and in-store solutions are seeing growth [36] Question: Impact of USPS postponing price increase - Management indicated that the postponement is favorable and could positively influence client spending for 2026 [38] Question: Updated guidance for net sales - Management explained that direct mail could see variability in the fourth quarter based on client budget adjustments [42] Question: Adjusted EBITDA and CapEx guidance - Management confirmed a slight decrease in the adjusted EBITDA midpoint and discussed a shift in CapEx focus towards technology and automation [46][47] Question: In-Store Connect deployment updates - Management reported increased interest from clients and a strong pipeline for In-Store Connect, with positive feedback from recent deployments [48]

Financial Data and Key Metrics Changes - Net sales for Q3 2025 were $588 million, a decrease of 7% compared to Q3 2024, excluding a 6% impact from the divestiture of European operations [20] - Adjusted EBITDA was $53 million in Q3 2025, down from $59 million in Q3 2024, with an adjusted EBITDA margin improving from 8.7% to 8.9% year-to-date [21] - Adjusted diluted earnings per share increased by 19% to $0.31 in Q3 2025 from $0.26 in Q3 2024, and year-to-date adjusted diluted earnings per share rose by 33% to $0.65 in 2025 from $0.49 in 2024 [22] Business Line Data and Key Metrics Changes - Revenue mix as a percentage of total net sales increased by 2% in targeted print offerings, driven by growth in direct marketing, packaging, and in-store solutions [20] - Direct mail revenue increased by over 6% year-to-date, packaging grew by over 9%, and in-store solutions rose by 11% year-to-date [36] Market Data and Key Metrics Changes - The USPS announced it would not issue a January price increase for market-dominant mail, which is expected to positively impact marketers as they finalize their 2026 media plans [6][39] - High postage rates continue to significantly impact the industry, but the lack of a January increase is seen as favorable for clients [39] Company Strategy and Development Direction - The company is making targeted investments in AI-powered tools, data intelligence services, and retail media networks to diversify revenue and return to net sales growth by 2028 [4] - The strategic focus includes maximizing savings for clients while increasing marketing effectiveness through innovative solutions like co-mailing and audience intelligence [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future growth of In-Store Connect, citing strong sales lift results from campaigns with major clients [16] - The company is closely monitoring macroeconomic pressures, including inflation and tariffs, which could affect client marketing spend [31] Other Important Information - The company returned $19 million of capital to shareholders year-to-date through dividends and share repurchases, with a 50% increase in the quarterly dividend [25] - The company expects free cash flow in Q4 2025 to be between $137 million and $147 million, following a seasonal pattern of negative cash flow in the first nine months of the year [23] Q&A Session Summary Question: Trends in targeted print categories - Management noted that catalog sales are muted due to postal increases, while direct mail, packaging, and in-store solutions are seeing growth [36][37] Question: Impact of USPS postponing price increase - Management indicated that the postponement is favorable and could positively influence client spending for 2026 [39][40] Question: Updated guidance for net sales - Management discussed variability in direct mail as a transactional area that could impact sales outlook for Q4 [42][44] Question: Adjusted EBITDA and CapEx guidance - The midpoint for adjusted EBITDA was slightly decreased, while capital expenditures are expected to shift towards technology and automation [46][48] Question: Updates on In-Store Connect deployment - Management reported increased interest from clients and a strong pipeline for In-Store Connect, with positive feedback on new digital signage solutions [49][50]

Financial Performance & Guidance - Net sales for the second quarter of 2025 were $571.9 million, compared to $634.2 million in the second quarter of 2024[33] - Adjusted EBITDA for the second quarter of 2025 was $43.3 million, with an Adjusted EBITDA Margin of 7.6%[33, 51] - The company anticipates a 2% to 6% decline in adjusted annual net sales for 2025, excluding the divested European operations[41, 44] - Full-year Adjusted EBITDA is projected to be between $180 million and $220 million for 2025[41] - Free cash flow is expected to be between $40 million and $60 million for the full year 2025[41] Debt & Leverage - Net debt as of June 30, 2025, was $448.2 million[54] - The debt leverage ratio as of June 30, 2025, was 2.13x[54] - The company aims for a long-term targeted debt leverage range of 1.5x to 2.0x[43] Strategic Initiatives & Market Trends - Quad's proprietary core dataset features 250 million consumers, mapped to their physical home address[9] - A survey indicates that 71% of consumers feel a deeper connection and loyalty to brands experienced in physical stores[21] - 71% of consumers find print catalogs and magazines more authentic than digital campaigns[21]