Financial Data and Key Metrics Changes - Net sales for Q2 2025 were $572 million, a decrease of 4% compared to Q2 2024, excluding a 6% impact from the divestiture of European operations [27] - Adjusted EBITDA was $43 million in Q2 2025, down from $52 million in Q2 2024, with the adjusted EBITDA margin declining from 8.2% to 7.6% [28] - Year-to-date adjusted diluted earnings per share increased to 34¢ in 2025 from 22¢ in 2024, attributed to higher earnings and share repurchases [29] Business Line Data and Key Metrics Changes - Revenue from targeted print offerings increased by 2%, driven by direct marketing, packaging, and in-store solutions, while large-scale print offerings decreased by 2% due to organic declines in magazines and retail inserts [27] - The company reported a 7% increase in sales for direct mail and packaging, and a 13% increase for in-store solutions [56] Market Data and Key Metrics Changes - The company noted that rising postal rates continue to challenge clients, but a new USPS catalog discount launching in October aims to alleviate some pressure [7] - The postal rate commission acknowledged that pricing increases have negatively impacted volume, leading to discussions about potential caps on future rate increases [43][44] Company Strategy and Development Direction - The company is investing in artificial intelligence to enhance marketing processes, focusing on process automation, cognitive insights, and cognitive engagement [10] - The launch of Audience Builder 2.0 aims to democratize access to the company's data stack, allowing for faster audience creation and improved client targeting [15][46] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the operating environment, noting that while there are concerns about tariffs, there has not been a significant pullback from clients [69] - The company reaffirmed its 2025 guidance, expecting net sales to decline by 2% to 6% compared to 2024, with a projected adjusted EBITDA range of $180 million to $220 million [34] Other Important Information - The company completed the sale of its Sacramento facility for approximately $5 million and made progress on the acquisition of Onur, a co-mailing and logistics provider [31][73] - The company plans to maintain a balanced capital allocation strategy, including returning capital to shareholders through dividends and share repurchases [32] Q&A Session Summary Question: What is the outlook on postal rates and the USPS? - Management expressed optimism about the new postmaster general and the potential for a 10% discount for catalogers, which could help mitigate volume declines due to rising rates [41][42] Question: Can you elaborate on the Audience Builder 2.0 tool? - The tool automates audience creation from the data stack, allowing users to generate audience lists using simple prompts, enhancing client targeting capabilities [46][48] Question: What are the trends in sales and the impact of the grocery client loss? - The grocery client represented about 3% of revenue, and while there was a decline in sales, the company expects increasing volumes in the upcoming quarters [65][66] Question: How is the company managing asset sales and net debt? - The company is actively selling facilities and has included estimates of potential sales in its net debt guidance, which is projected to decrease by $50 million [75][76]