DELUXE CORP

Previous wording

A comprehensive discussion of our strategy is provided in Part I, Item 1 of the 2025 Form 10-K. In the first quarter of 2026, we continued to execute on our strategic priorities of accelerating profitable growth, enhancing operational efficiency, and disciplined capital allocation.

Current wording

A comprehensive discussion of our strategy is provided in Part I, Item 1 of the 2025 Form 10-K. During the first half of 2026, we continued to execute on our strategic priorities of accelerating profitable growth, enhancing operational efficiency, and disciplined capital allocation.

Previous wording

Accelerating profitable growth – In March 2026, we completed the divestiture of the Safeguard small business distributor channel within our Print segment, generating $22.8 million of net proceeds. The transaction reduced first quarter 2026 Print revenue by approximately $12.6 million and Print adjusted EBITDA by approximately $1.7 million, and enables greater focus on our core growth businesses and ongoing portfolio optimization. Collectively, our payments and data businesses delivered 12.5% year-over-year revenue growth and a 22.8% increase in adjusted EBITDA in the first quarter of 2026.

Current wording

Accelerating profitable growth – We continued to execute on our strategy of growing our payments and data businesses while optimizing our overall portfolio, delivering stronger revenue mix and profitability. In March 2026, we completed the divestiture of the Safeguard small business distributor channel within our Print segment, a strategic action enabling greater focus on our growth businesses and ongoing portfolio optimization objectives. The divestiture reduced first-half 2026 Print segment revenue by approximately $47.1 million and Print adjusted EBITDA by approximately $4.9 million compared to the first half of 2025. At the same time, our payments and data businesses demonstrated strong momentum, collectively delivering 11.1% year-over-year revenue growth and a 14.6% increase in adjusted EBITDA in the first half of 2026.

Previous wording

Enhancing operational efficiency – In the first quarter of 2026, we reduced selling, general and administrative (SG&A) expense by 7.1% year-over-year, reflecting the benefits of our ongoing and prior cost management efforts. Additionally, despite revenue pressures in the Print segment, operational improvements resulted in adjusted EBITDA margin improvement for this segment. These results contributed to year-over-year increases in net income, consolidated adjusted EBITDA, and consolidated adjusted EBITDA margin in the first quarter of 2026.

Current wording

Enhancing operational efficiency – In the first half of 2026, we reduced selling, general and administrative (SG&A) expense by 6.4% year-over-year, reflecting the benefits of our ongoing cost management efforts. Additionally, despite revenue pressures in the Print segment, operational improvements resulted in adjusted EBITDA margin improvement for this segment. These results contributed to year-over-year increases in net income, consolidated adjusted EBITDA, and consolidated adjusted EBITDA margin in the first half of 2026.

Previous wording

Disciplined capital allocation – We continued to apply our capital allocation framework, working to ensure investments are aligned with our growth objectives and deliver optimal returns. In the first quarter of 2026, net cash provided by operating activities increased by $2.4 million year-over-year, and we reduced total debt by $32.3 million compared to year-end 2025.

Current wording

Disciplined capital allocation – We continued to apply our capital allocation framework, working to ensure investments are aligned with our growth objectives and deliver optimal returns. In the first half of 2026, net cash provided by operating activities increased by $32.5 million year-over-year, and we reduced total debt by $77.2 million compared to year-end 2025. The Celero acquisition reflects our commitment to accelerating growth, and we remain focused on disciplined deleveraging. The strong cash generation of our business, combined with available capacity under our credit arrangements, positions us well to service our obligations, reduce leverage over time, and continue delivering value for shareholders.

Previous wording

Highlights of our financial results for the first quarter of 2026 compared to the first quarter of 2025 include:

Current wording

Highlights of our financial results for the first half of 2026 compared to the first half of 2025 include:

Previous wording

•Consolidated revenue – Increased by $1.6 million to $538.1 million, driven by growth in all three of our payments and data businesses. This growth was partially offset by demand softness for promotional products and the ongoing secular decline in order volumes for checks, business forms, and various business accessories in our Print segment. In addition, our first quarter business exit resulted in a decrease in revenue of approximately $12.6 million.

Current wording

•Consolidated revenue – Decreased by $20.3 million to $1,037.4 million, primarily driven by the first quarter business exit, which reduced revenue by approximately $47.1 million. Additionally, the ongoing secular decline in order volumes for checks, business forms, and various business accessories in our Print segment contributed to the decrease. These unfavorable drivers were partially offset by growth in all three of our payments and data businesses.

Previous wording

•Net income– Increased by $21.8 million to $35.8 million, primarily reflecting the impact of our cost management and pricing initiatives, as well as lower restructuring and integration expense. Growth in our payments and data businesses further contributed to the improvement. Additionally, during the first quarter of 2026, we recognized a $5.1 million gain from the sale of the Safeguard small business distributor channel within the Print segment, and interest expense decreased $3.6 million year-over-year. These favorable factors were partially offset by the continuing demand softness and secular declines in the Print segment, as well as inflationary pressures impacting material and delivery costs.

Current wording

•Net income– Increased by $18.5 million to $55.0 million, primarily reflecting the impact of our cost management and pricing initiatives, as well as lower restructuring and integration expense. Growth in our payments and data businesses further contributed to the improvement. Additionally, interest expense decreased $6.6 million year-over-year and we recognized a $5.1 million gain from the sale of the Safeguard small business distributor channel within the Print segment. These favorable factors were partially offset by the continuing demand softness and secular declines in the Print segment, inflationary pressures impacting material and delivery costs, and transaction costs related to the Celero acquisition of $5.6 million in the first half of 2026.

Previous wording

•Adjusted EBITDA– Increased $17.7 million to $117.9 million, driven by the benefits of our cost management and pricing initiatives and growth in our payments and data businesses. These favorable impacts were partially offset by demand softness and the ongoing secular declines in the Print segment and inflationary cost pressures. In addition, our first quarter business exit resulted in a decrease in adjusted EBITDA of approximately $1.7 million.

Current wording

•Adjusted EBITDA– Increased $20.1 million to $226.7 million, driven by the benefits of our cost management and pricing initiatives and growth in our payments and data businesses. These favorable impacts were partially offset by demand softness and the ongoing secular declines in the Print segment and inflationary cost pressures. In addition, our first quarter business exit resulted in a decrease in adjusted EBITDA of approximately $4.9 million.

Previous wording

Adjusted EBITDA margin increased to 21.9% for the first quarter of 2026, compared to 18.7% for the first quarter of 2025. The margin improvement was primarily driven by our cost management and pricing initiatives, partially offset by inflationary pressures and the shift in mix toward our growth businesses. A reconciliation of net income to adjusted EBITDA can be found in the Consolidated Results of Operations section.

Current wording

Adjusted EBITDA margin increased to 21.9% for the first half of 2026, compared to 19.5% for the first half of 2025. The margin improvement was primarily driven by our cost management and pricing initiatives, partially offset by inflationary pressures and the shift in mix toward our growth businesses. A reconciliation of net income to adjusted EBITDA can be found in the Consolidated Results of Operations section.

Previous wording

•Net cash provided by operating activities– Increased by $2.4 million to $52.7 million. The increase was primarily driven by the benefits of our cost management and pricing actions, lower income tax payments due to the impact of federal tax law changes, and lower cash expenditures for restructuring and integration activities.

Current wording

•Net cash provided by operating activities– Increased by $32.5 million to $133.9 million. The increase was primarily driven by the benefits of our cost management and pricing actions, lower income tax payments due to the impact of federal tax law changes enacted in July 2025, favorable changes in working capital, and lower cash expenditures for restructuring and integration activities.

Previous wording

These benefits were partially offset by higher payouts for performance-based employee cash bonuses related to our 2025 performance, timing-related changes in accounts payable, demand softness and continuing secular declines in the Print segment, and inflationary cost pressures.

Current wording

These benefits were partially offset by higher payouts for performance-based employee cash bonuses related to our 2025 performance, demand softness and continuing secular declines in the Print segment, and inflationary cost pressures.

Previous wording

•Free cash flow– Increased by $3.0 million to $27.3 million, reflecting the same factors that drove the increase in net cash provided by operating activities. We continue to reinvest the free cash flow generated by our Print business into our other businesses. Free cash flow is defined as net cash provided by operating activities less purchases of capital assets. A reconciliation of free cash flow to its most directly related GAAP financial measure can be found in the Consolidated Results of Operations section.

Current wording

•Free cash flow– Increased by $33.8 million to $85.9 million, reflecting the same factors that drove the increase in net cash provided by operating activities. We continue to reinvest the free cash flow generated by our Print business into our other businesses. Free cash flow is defined as net cash provided by operating activities less purchases of capital assets. A reconciliation of free cash flow to its most directly related GAAP financial measure can be found in the Consolidated Results of Operations section.

Previous wording

We continually monitor macroeconomic conditions and other external factors that may affect our business, including interest rates, inflation, small business sentiment, consumer spending trends, and global economic conditions. As of March 31, 2026, 66% of our debt had a weighted-average fixed interest rate of 8.1%, which provides partial insulation from changes in market interest rates. This capital structure helps moderate our exposure to interest rate volatility in a higher‑rate environment, although future changes in rates could still affect our borrowing costs due to our variable-rate debt.

Current wording

We continually monitor macroeconomic conditions and other external factors that may affect our business, including interest rates, inflation, small business sentiment, consumer spending trends, and global economic conditions. As of June 30, 2026, 68% of our debt had a weighted-average fixed interest rate of 8.1%, which provides partial insulation from changes in market interest rates. This capital structure helps moderate our exposure to interest rate volatility in a higher‑rate environment, although future changes in rates could still affect our borrowing costs due to our variable-rate debt.

Previous wording

Inflationary pressures have continued to affect the broader economy, particularly with respect to logistics, energy, and certain raw material costs. These pressures remain an important external factor influencing our cost structure, pricing dynamics, and customer demand. In response, we implemented targeted price adjustments, particularly within our Print and Merchant Services segments, to help offset increased costs while remaining mindful of customer price sensitivity. We continue to monitor inflation trends closely, including the potential for further cost volatility driven by supply chain disruptions, energy markets, and raw material price fluctuations.

Current wording

Macroeconomic conditions, including inflation, energy price volatility, and fluctuations in logistics and certain raw material costs, continue to influence our cost structure, pricing dynamics, and customer demand. In response, we implemented targeted price adjustments, particularly within our Merchant Services and Print segments, to help offset increased costs while remaining mindful of customer price sensitivity. We continue to monitor these trends closely, including the potential for further cost volatility resulting from changes in energy markets, supply chain conditions, and raw material pricing.

Previous wording

Global economic conditions remain uncertain, reflecting ongoing geopolitical unrest and evolving trade policies, treaties, and tariffs. These developments have the potential to disrupt supply chains, increase operating costs, and affect the availability and timing of certain goods and services. In addition, heightened geopolitical tensions have increased cybersecurity and technology‑related risks, reinforcing the importance of continued investments in information security, data protection, and technology resilience.

Current wording

Global economic conditions remain uncertain, reflecting ongoing geopolitical unrest and evolving trade policies, treaties, and tariffs. These developments may disrupt supply chains, increase operating costs, and affect the availability, timing, and pricing of certain goods and services. In addition, heightened geopolitical tensions and an increasingly complex threat environment have elevated cybersecurity and technology‑related risks, reinforcing the importance of continued investments in information security, data protection, and technology resilience.

Previous wording

We also closely track trends in small business sentiment and consumer discretionary spending, as these factors influence demand across our portfolio. Our analysis incorporates data from credit card networks, the Federal Reserve, leading economic forecasters, and our proprietary analytics. Recent economic indicators suggest continued pressure on consumer confidence, which has contributed to softer demand trends, particularly within discretionary spending categories. Small business sentiment softened in early 2026 amid higher uncertainty and cost pressures, although underlying demand and employment indicators remained relatively stable. Persistent inflation concerns, uncertainty in the labor market outlook, and trade‑related disruptions may continue to influence our customers’ purchasing behavior. A sustained period of economic uncertainty or a broader slowdown in global economic activity could adversely affect our financial position, results of operations, and future growth prospects.

Current wording

We also closely track trends in small business sentiment and consumer discretionary spending, as these factors influence demand across our portfolio. Our analysis incorporates data from credit card networks, the Federal Reserve, leading economic forecasters, and our proprietary analytics. Recent economic indicators suggest continued caution among consumers and small businesses amid ongoing economic uncertainty and cost pressures. While employment conditions and other underlying economic indicators have generally remained stable, shifts in consumer and business spending patterns could influence transaction volumes in our Merchant Services segment and demand for certain discretionary products within our Print segment. Inflation, labor market conditions, trade policies, tariffs, and other macroeconomic factors may continue to influence customer purchasing behavior. A sustained period of economic uncertainty or a broader slowdown in economic activity could adversely affect our financial position, results of operations, and future growth prospects.

Previous wording

As of March 31, 2026, we held cash and cash equivalents of $27.2 million, along with an additional $380.9 million available for borrowing under our revolving credit facility. We anticipate that capital expenditures will be between $90.0 and $100.0 million for the full year, compared to $95.3 million in 2025, as we continue to build scale across our product categories and invest in innovation. Our capital allocation priorities remain focused on responsible growth investments, debt reduction, and returning capital to shareholders through dividends, which are subject to quarterly approval by our board of directors.

Current wording

As of June 30, 2026, we held cash and cash equivalents of $34.9 million, along with an additional $384.3 million available for borrowing under our revolving credit facility. We anticipate that capital expenditures will be between $100.0 million and $110.0 million for the full year, compared to $95.3 million in 2025, as we continue to build scale across our product categories and invest in innovation. Our capital allocation priorities remain focused on responsible growth investments, debt reduction, and returning capital to shareholders through dividends, which are subject to quarterly approval by our board of directors.

Previous wording

We believe that net cash generated by operations, together with our cash and cash equivalents on hand and available credit, will be sufficient to meet our operational needs, contractual obligations, and debt service requirements over the next 12 months. This assessment takes into account our working capital position and anticipated cash flows. We regularly monitor our liquidity position in light of potential risks, including market volatility, interest rate fluctuations, and macroeconomic uncertainty, and we are prepared to adjust our capital allocation strategy as needed. As of March 31, 2026, we were in compliance with our debt covenants. Additional information regarding our long-term capital requirements and debt maturities can be found in the Cash Flows and Liquidity and Capital Resources sections.

Current wording

We believe that net cash generated by operations, together with our cash and cash equivalents on hand and available credit, will be sufficient to meet our operational needs, contractual obligations, and debt service requirements over the next 12 months. This assessment takes into account our working capital position and anticipated cash flows, including those associated with the additional debt incurred in connection with the acquisition of Celero. We regularly monitor our liquidity position in light of potential risks, including market volatility, interest rate fluctuations, and macroeconomic uncertainty, and we are prepared to adjust our capital allocation strategy as needed. As of June 30, 2026, we were in compliance with our debt covenants. Additional information regarding our long-term capital requirements and debt maturities can be found in the Cash Flows and Liquidity and Capital Resources sections.

Previous wording

Total cost of revenue increased in the first quarter of 2026 compared to the first quarter of 2025, primarily due to the revenue growth in our data-driven marketing business and inflationary pressures on materials and delivery costs. These increases were partially offset by lower costs associated with the soft demand for promotional products and the continued secular declines in the Print segment, as well as the impact of our cost management initiatives. In addition, the first quarter business exit reduced cost of revenue by approximately $6.0 million in the first quarter.

Current wording

Total cost of revenue increased in the first half of 2026 compared to the first half of 2025. The increase was primarily due to the revenue growth and higher favorability in the prior year from vendor rebates in our data-driven marketing business, as well as inflationary pressures on materials and delivery costs. These increases were partially offset by lower costs associated with the soft demand for promotional products and the continued secular declines in the Print segment, as well as the impact of our cost management initiatives. In addition, the first quarter business exit discussed in the Executive Overview section reduced cost of revenue by approximately $22.3 million in the first half of 2026.

Previous wording

As a percentage of total revenue, total cost of revenue increased in the first quarter of 2026 compared to the first quarter of 2025. Inflationary pressures and a shift in revenue mix toward our lower-margin growth businesses contributed to margin pressure, partially offset by the benefits of cost management initiatives and pricing actions implemented to address inflation.

Current wording

As a percentage of total revenue, total cost of revenue increased in the second quarter and first half of 2026 compared to the same periods in 2025, driven by inflationary pressures and a shift in revenue mix toward our growth businesses. These increases were partially offset by the benefits of targeted pricing actions to address inflation and cost management initiatives.

Previous wording

As a percentage of total revenue, SG&A expense decreased in the first quarter of 2026 compared to the first quarter of 2025, reflecting the impact of our cost management actions.

Current wording

As a percentage of total revenue, SG&A expense decreased in the second quarter of 2026 compared to the second quarter of 2025, as our cost management actions and the impact of the first quarter business exit more than offset the impact of the acquisition transaction costs incurred during the quarter.

Previous wording

SG&A expense decreased in the first quarter of 2026 compared to the first quarter of 2025, primarily as a result of our ongoing cost management initiatives, including actions such as workforce adjustments across multiple functions and the optimization of our marketing strategies. In addition, medical costs were lower and commission expense declined due to lower Print revenue volumes. The business exit during the quarter further reduced SG&A expense by approximately $5.9 million.

Current wording

SG&A expense decreased in the first half of 2026 compared to the first half of 2025, primarily as a result of our ongoing cost management initiatives, including actions such as workforce adjustments across multiple functions and the optimization of our marketing strategies. In addition, commission expense declined due to lower Print revenue volumes, and medical costs decreased. The first quarter business exit discussed in the Executive Overview section further reduced SG&A expense by approximately $23.0 million in the first half of 2026. Partially offsetting these decreases in SG&A expense were transaction costs of $5.6 million related to the Celero acquisition discussed in the Executive Overview section.

Previous wording

In the first quarter of 2026, we recognized a gain on the sale of the Safeguard small business distributor channel within our Print segment. Further information can be found under the caption "Note 6: Divestitures" in the Condensed Notes to Unaudited Consolidated Financial Statements located in Part 1, Item 1 of this report.

Current wording

In the first quarter of 2026, we recognized a gain on the sale of the Safeguard small business distributor channel within our Print segment. Further information can be found under the caption "Note 6: Acquisition and Divestitures" in the Condensed Notes to Unaudited Consolidated Financial Statements located in Part 1, Item 1 of this report.

Previous wording

Interest expense decreased in the first quarter of 2026 compared to the first quarter of 2025 due to a reduction in both average debt outstanding and the weighted-average interest rate. Our exposure to variable-rate debt remains a key consideration for future interest expense. Based on the amount of variable-rate debt outstanding as of March 31, 2026, a one percentage point change in the weighted-average interest rate would result in a $4.0 million impact on interest expense for the remainder of 2026.

Current wording

Interest expense decreased in the second quarter and first half of 2026 compared to the same periods in 2025 primarily due to a reduction in average debt outstanding, as well as a lower weighted-average interest rate. As of June 30, 2026, $440.0 million of our debt was subject to variable rates, which exposes us to fluctuations in market interest rates. Based on the amount of variable-rate debt outstanding as of June 30, 2026, a one percentage point change in the weighted-average interest rate would result in a $2.0 million impact on interest expense for the remainder of 2026.

Previous wording

The effective income tax rate decreased in the first quarter of 2026 compared to the first quarter of 2025. The 2026 rate benefited from a higher tax benefit related to employee share-based compensation and lower foreign income tax expense. These decreases in our effective income tax rate were partially offset by an increase in the deferred tax valuation allowance of $2.3 million related to a capital loss carryforward generated during the quarter that we do not expect to fully utilize, as well as the tax impact of non-deductible executive compensation expense and state income taxes. Further information regarding our income tax provision can be found under the caption "Note 9: Income Taxes" in the Condensed Notes to Unaudited Consolidated Financial Statements located in Part I, Item 1 of this report.

Current wording

Our effective income tax rate of 28.3% for the six months ended June 30, 2026 was unchanged compared to the same period in 2025. The 2026 rate benefited from a higher tax benefit related to employee share-based compensation and lower foreign income taxes. These favorable impacts were offset by several factors, including a $2.3 million increase in the valuation allowance related to a capital loss carryforward generated during the period that we do not expect to fully utilize, as well as the tax impact related to the surrender of COLI policies, higher non-deductible executive compensation expense, and state income taxes. Further information regarding our income tax provision can be found under the caption "Note 9: Income Taxes" in the Condensed Notes to Unaudited Consolidated Financial Statements located in Part I, Item 1 of this report.

Previous wording

Net income and diluted EPS increased in the first quarter of 2026 as compared to the first quarter of 2025, driven by the factors discussed above. Adjusted diluted EPS also increased year-over-year, primarily reflecting the benefits of our cost management and pricing initiatives, as well as growth in our payments and data businesses. These favorable impacts were partially offset by the soft demand for promotional products and the ongoing secular declines in the Print segment and inflationary cost pressures. In addition, the first quarter business exit reduced adjusted diluted EPS by $0.03 per share on a year-over-year basis. A reconciliation of net income to adjusted net income, as used in the calculation of adjusted diluted EPS, can be found in the following section.

Current wording

Net income and diluted EPS increased in the first half of 2026 as compared to the first half of 2025, driven by the factors discussed above regarding our results for the first half of the year. Adjusted diluted EPS also increased year-over-year, primarily reflecting the benefits of our cost management and pricing initiatives, as well as growth in our payments and data businesses and a reduction in interest expense. These favorable impacts were partially offset by the soft demand for promotional products, the ongoing secular declines in the Print segment, inflationary cost pressures, and higher amortization expense driven by our technology investments. In addition, the first quarter business exit discussed in the Executive Overview section reduced adjusted diluted EPS on a year-over-year basis by $0.08 per share for the first half of 2026.

Previous wording

By the end of 2025, we had completed the material components of our North Star program, a comprehensive, multi-year initiative designed to enhance shareholder value by accelerating adjusted EBITDA growth, increasing cash flow, reducing debt, and improving our leverage ratio. We did not incur any additional restructuring and integration expense related to the North Star program in the first quarter of 2026. However, we continue to realize the benefits of actions taken under the program, which contributed to improved operating results during the first quarter of 2026.

Current wording

By the end of 2025, we had completed the material components of our North Star program, a comprehensive, multi-year initiative designed to enhance shareholder value by accelerating adjusted EBITDA growth, increasing cash flow, reducing debt, and improving our leverage ratio. Related restructuring and integration expense incurred during the first half of 2026 was not material. However, we continue to realize the benefits of actions taken under the program, which contributed to improved operating results in 2026.

Previous wording

Both adjusted EBITDA and adjusted EBITDA margin increased year-over-year during the first quarter of 2026. These improvements were supported by a 7.1% reduction in SG&A expense. Within our Print segment, adjusted EBITDA margin also improved as a result of our optimization actions, even as revenue pressures continue in the business. In addition, net cash provided by operating activities increased by $2.4 million year-over-year, and we reduced total debt by $32.3 million compared to the prior year-end. These results reflect the ongoing benefits of initiatives completed in prior periods, as well as incremental improvements from current‑period actions.

Current wording

Both adjusted EBITDA and adjusted EBITDA margin increased year-over-year during the first half of 2026. These improvements were supported by a 6.4% reduction in SG&A expense. Within our Print segment, adjusted EBITDA margin also improved as a result of our optimization actions, even as revenue pressures continue in the business. In addition, net cash provided by operating activities increased by $32.5 million year-over-year, and we reduced total debt by $77.2 million compared to the prior year-end. These results reflect the ongoing benefits of initiatives completed in prior periods, as well as incremental improvements from current‑period actions.

Previous wording

The restructuring and integration expense recognized in the first quarter of 2026 relates to various employee reductions and other efficiency initiatives. The majority of the employee reductions included in our restructuring and integration accruals as of March 31, 2026, along with the related severance payments, are expected to be completed by the end of 2026. As a result of these employee reductions, we expect to realize annual cost savings in 2026 of approximately $2.0 million in cost of sales and $20.0 million in SG&A expense compared to our 2025 results of operations. These expected savings relate only to the employee reductions and do not reflect the total impact of all cost reduction initiatives. Actual results may be affected by factors such as inflationary cost pressures and continued investments in the business.

Current wording

The restructuring and integration expense recognized in the first half of 2026 relates to various employee reductions and other efficiency initiatives. The majority of the employee reductions included in our restructuring and integration accruals as of June 30, 2026, along with the related severance payments, are expected to be completed by the end of 2026.

Previous wording

Total revenue increased in the first quarter of 2026 compared to the first quarter of 2025, driven by a combination of factors, including higher transaction volumes from government clients, new banking customer implementations, and targeted pricing actions. These positive drivers were partially offset by ongoing economic uncertainty, which continued to exert pressure on consumer and business spending in certain customer channels.

Current wording

Total revenue increased in the second quarter and first half of 2026 compared to the same periods in 2025, driven by a combination of factors, including new customer implementations, higher transaction volumes from existing partners across several channels, and targeted pricing actions. These positive drivers were partially offset by pressure on consumer and business spending in certain customer channels.

Previous wording

Adjusted EBITDA and adjusted EBITDA margin also improved in the first quarter of 2026 compared to the first quarter of 2025, reflecting targeted price increases, cost management initiatives, including the year-end 2025 purchase of residual commission rights from an independent sales organization (ISO) partner, and contributions from new banking client implementations.

Current wording

Adjusted EBITDA and adjusted EBITDA margin also improved in the second quarter and first half of 2026 compared to the same periods in 2025, reflecting targeted price increases, cost management initiatives, including the year-end 2025 purchase of residual commission rights from an ISO partner, and contributions from new client implementations.

Previous wording

Total revenue increased in the first quarter of 2026 compared to the first quarter of 2025, driven by the onboarding of new receivables processing clients, increased lockbox processing volume, and the implementation of modest price increases to counteract inflationary pressure. These impacts were partially offset by pressure on receivables processing volumes in certain customer relationships.

Current wording

Total revenue increased in the second quarter and first half of 2026 compared to the same periods in 2025, driven by the onboarding of new lockbox and remittance processing clients, increased remittance processing volume, and the implementation of modest price increases to counteract inflationary pressure. These impacts were partially offset by pressure on remittance processing volumes in certain customer relationships.

Previous wording

Adjusted EBITDA and adjusted EBITDA margin also increased in the first quarter of 2026 as compared to the first quarter of 2025, largely attributable to our pricing strategies and ongoing cost management actions, including operational efficiencies within our lockbox processing operations and marketing optimization strategies.

Current wording

Adjusted EBITDA and adjusted EBITDA margin also increased in the second quarter and first half of 2026 as compared to the same periods in 2025, largely attributable to our pricing strategies and ongoing cost management actions, including operational efficiencies within our lockbox processing operations and marketing optimization strategies. Additionally, the impact of new client implementations contributed to adjusted EBITDA in both periods.

Previous wording

Total revenue increased in the first quarter of 2026 compared to the first quarter of 2025, driven by a $20.5 million year-over-year increase in data-driven marketing revenue, reflecting strong demand for customer acquisition marketing activities, particularly from our financial institution partners.

Current wording

Total revenue increased in the second quarter and first half of 2026 compared to the same periods in 2025, driven by a year-over-year increase in data-driven marketing revenue of $14.7 million in the second quarter and $35.1 million in the first half of the year, reflecting strong demand for customer acquisition marketing activities, particularly from our financial institution partners.

Previous wording

Adjusted EBITDA also increased in the first quarter of 2026 compared to the first quarter of 2025, primarily driven by the higher data-driven marketing volume. Adjusted EBITDA margin decreased in the first quarter of 2026 compared to the first quarter of 2025, driven by an unfavorable mix of clients and campaign activity relative to the prior year, which impacted overall profitability.

Current wording

Adjusted EBITDA decreased in the second quarter of 2026 compared to the second quarter of 2025, primarily driven by higher favorability from vendor rebates in the prior year, partially offset by the higher data-driven marketing volume. Adjusted EBITDA increased in the first half of 2026 compared to the first half of 2025, primarily driven by the higher data-driven marketing volume, partially offset by higher favorability from vendor rebates in the prior year.

Previous wording

Total revenue decreased in the first quarter of 2026 compared to the first quarter of 2025, mainly due to soft demand for promotional products and the ongoing secular decline in order volumes for checks, business forms, and various business accessories. In addition, we completed the sale of the Safeguard small business distributor channel, which drove a decrease in revenue of approximately $12.6 million. These revenue declines were partially offset by our pricing strategies implemented to address inflationary pressures.

Current wording

Total revenue decreased in the second quarter and first half of 2026 compared to the same periods in 2025, primarily driven by soft demand for promotional products and the ongoing secular decline in order volumes for checks, business forms, and various business accessories. In addition, during the first quarter of 2026, we completed the sale of the Safeguard small business distributor channel, which drove a decrease in revenue of approximately $34.5 million in the second quarter of 2026 and $47.1 million in the first half of 2026. These revenue declines were partially offset by our pricing strategies implemented to address inflationary pressures.

Previous wording

Adjusted EBITDA also decreased in the first quarter of 2026 compared to the first quarter of 2025, largely attributable to the lower revenue and inflationary pressures affecting material and delivery costs. In addition, the exit from the Safeguard small business distributor channel drove a decrease in adjusted EBITDA of approximately $1.7 million. We continued to execute cost management actions, including disciplined operating expense control and process efficiency improvements, which partially offset these impacts.

Current wording

Adjusted EBITDA also decreased in the second quarter and first half of 2026 compared to the same periods in 2025, largely attributable to the lower revenue and inflationary pressures affecting material and delivery costs. In addition, the exit from the Safeguard small business distributor channel drove a decrease in adjusted EBITDA of approximately $3.2 million in the second quarter of 2026 and $4.9 million in the first half of 2026. We continued to execute cost management actions, including disciplined operating expense control and process efficiency improvements, which partially offset these impacts.

Previous wording

Adjusted EBITDA margin increased in the first quarter of 2026 compared to the first quarter of 2025, as pricing actions, cost management initiatives, and a shift in revenue mix toward higher-margin check products more than offset the effect of inflationary cost pressures.

Current wording

Adjusted EBITDA margin increased year-over-year in both periods, as pricing actions, cost management initiatives, and a shift in revenue mix toward higher-margin check products more than offset the effect of inflationary cost pressures.

Previous wording

As of March 31, 2026, we held cash and cash equivalents of $27.2 million. Additionally, we had restricted cash and restricted cash equivalents, which were included in settlement processing assets and other non-current assets on the consolidated balance sheet, totaling $35.1 million. The following table should be read in conjunction with the consolidated statements of cash flows located in Part I, Item 1 of this report.

Current wording

As of June 30, 2026, we held cash and cash equivalents of $34.9 million. Additionally, we had restricted cash and restricted cash equivalents, which were included in settlement processing assets and other non-current assets on the consolidated balance sheet, totaling $19.5 million. The following table should be read in conjunction with the consolidated statements of cash flows located in Part I, Item 1 of this report.

Previous wording

Net cash provided by operating activities increased by $2.4 million in the first quarter of 2026 compared to the first quarter of 2025. The increase was primarily driven by the benefits of our cost management and pricing actions, a $14.3 million reduction in income tax payments due to the impact of federal tax law changes, and lower cash expenditures for restructuring and integration activities. These increases were partially offset by a $12.4 million increase in payouts for performance-based employee cash bonuses related to our 2025 performance, timing-related changes in accounts payable, continuing demand softness and secular declines in the Print segment, and inflationary cost pressures.

Current wording

Net cash provided by operating activities increased by $32.5 million in the first half of 2026 compared to the first half of 2025. The increase was primarily driven by the benefits of our cost management and pricing actions, a $26.3 million reduction in income tax payments due to the impact of federal tax law changes enacted in July 2025, favorable changes in working capital, and lower cash expenditures for restructuring and integration activities. These favorable impacts were partially offset by a $12.4 million increase in payouts for performance-based employee cash bonuses related to our 2025 performance, continuing demand softness and secular declines in the Print segment, and inflationary cost pressures.