Quad/Graphics, Inc.

Previous wording

The following discussion of the financial condition and results of operations of Quad should be read together with (1) the condensed consolidated financial statements for the three months ended March 31, 2026 and 2025, including the notes thereto, included in Item 1, “Condensed Consolidated Financial Statements (Unaudited),” of this Quarterly Report on Form 10-Q; and (2) the audited consolidated annual financial statements as of and for the year ended December 31, 2025, and notes thereto included in the Company’s Annual Report on Form 10-K, filed with the SEC on February 18, 2026.

Current wording

The following discussion of the financial condition and results of operations of Quad should be read together with (1) the condensed consolidated financial statements for the three and six months ended June 30, 2026 and 2025, including the notes thereto, included in Item 1, “Condensed Consolidated Financial Statements (Unaudited),” of this Quarterly Report on Form 10-Q; and (2) the audited consolidated annual financial statements as of and for the year ended December 31, 2025, and notes thereto included in the Company’s Annual Report on Form 10-K, filed with the SEC on February 18, 2026.

Previous wording

•Results of Operations. This section contains an analysis of the Company’s results of operations by comparing the results for the three months ended March 31, 2026, to the three months ended March 31, 2025. The comparability of the Company’s results of operations between periods was impacted by the divestiture of the Company's European operations, which were sold on February 28, 2025, and the acquisition of the Enru co-mail assets, which were acquired on April 1, 2025. The results of operations of the divested operations are included in the Company’s condensed consolidated results until the date of disposition and the results of operations of the acquired operations are included in the Company’s condensed consolidated results from the date of acquisition. Forward-looking statements providing a general description of recent and projected industry and Company developments that are important to understanding the Company’s results of operations are included in this section. This section also provides a discussion of EBITDA and EBITDA margin, financial measures that the Company uses to assess the performance of its business that are not prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Current wording

•Results of Operations. This section contains an analysis of the Company’s results of operations by comparing the results for (1) the three months ended June 30, 2026, to the three months ended June 30, 2025; and (2) the six months ended June 30, 2026, to the six months ended June 30, 2025. The comparability of the Company’s results of operations between periods was impacted by the divestiture of the Company's European operations, which were sold on February 28, 2025, and the acquisition of the Enru co-mail assets, which were acquired on April 1, 2025. The results of operations of the divested operations are included in the Company’s condensed consolidated results until the date of disposition and the results of operations of the acquired operations are included in the Company’s condensed consolidated results from the date of acquisition. Forward-looking statements providing a general description of recent and projected industry and Company developments that are important to understanding the Company’s results of operations are included in this section. This section also provides a discussion of EBITDA and EBITDA margin, financial measures that the Company uses to assess the performance of its business that are not prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Previous wording

Quad applies holistic continuous improvement and lean enterprise methodologies to further streamline its processes and maximize operating margins. These same methodologies are applied to its selling, general and administrative functions. The Company continually works to lower its cost structure by consolidating manufacturing operations into its most efficient facilities, as well as realizing purchasing, mailing and logistics synergies by centralizing and consolidating print manufacturing volumes, and eliminating redundancies in its administrative and corporate operations. Quad believes that its focused efforts to be a high-quality, low-cost producer, will enable it to generate increased Free Cash Flow and allow the Company to maintain a strong balance sheet through debt reduction. The Company’s disciplined financial approach and strong, trusted banking relationships allows it to maintain sufficient liquidity and to reduce refinancing risk. The Company had total liquidity of $250.9 million as of March 31, 2026, which consisted of up to $243.9 million of unused capacity under its revolving credit agreement, which was net of $23.8 million of issued letters of credit, and cash and cash equivalents of $7.0 million. Total liquidity is reduced to $177.4 million under the Company’s most restrictive debt covenants.

Current wording

Quad applies holistic continuous improvement and lean enterprise methodologies to further streamline its processes and maximize operating margins. These same methodologies are applied to its selling, general and administrative functions. The Company continually works to lower its cost structure by consolidating manufacturing operations into its most efficient facilities, as well as realizing purchasing, mailing and logistics synergies by centralizing and consolidating print manufacturing volumes, and eliminating redundancies in its administrative and corporate operations. Quad believes that its focused efforts to be a high-quality, low-cost producer, will enable it to generate increased Free Cash Flow and allow the Company to maintain a strong balance sheet through debt reduction. The Company’s disciplined financial approach and strong, trusted banking relationships allows it to maintain sufficient liquidity and to reduce refinancing risk. The Company had total liquidity of $275.9 million as of June 30, 2026, which consisted of up to $268.5 million of unused capacity under its revolving credit agreement, which was net of $23.6 million of issued letters of credit, and cash and cash equivalents of $7.4 million. Total liquidity is reduced to $208.6 million under the Company’s most restrictive debt covenants.

Previous wording

•The United States Print and Related Services segment is predominantly comprised of the Company’s United States printing operations, managed as one integrated platform, and marketing and other complementary services. The printing operations include print execution and logistics for retail inserts, catalogs, long-run publications, special interest publications, journals, direct mail, directories, in-store marketing and promotion, packaging, custom print products, as well as other commercial and specialty printed products, along with global paper procurement and the manufacture of ink. Marketing and other complementary services include data intelligence and analytics, technology solutions, media planning, placement and optimization, creative strategy and content creation, as well as execution in non-print channels (e.g., digital and broadcast). This segment also includes medical services. The United States Print and Related Services segment accounted for approximately 91% of the Company’s consolidated net sales during the three months ended March 31, 2026.

Current wording

•The United States Print and Related Services segment is predominantly comprised of the Company’s United States printing operations, managed as one integrated platform, and marketing and other complementary services. The printing operations include print execution and logistics for retail inserts, catalogs, long-run publications, special interest publications, journals, direct mail, directories, in-store marketing and promotion, packaging, custom print products, as well as other commercial and specialty printed products, along with global paper procurement and the manufacture of ink. Marketing and other complementary services include data intelligence and analytics, technology solutions, media planning, placement and optimization, creative strategy and content creation, as well as execution in non-print channels (e.g., digital and broadcast). This segment also includes medical services. The United States Print and Related Services segment accounted for approximately 91% of the Company’s consolidated net sales during the three and six months ended June 30, 2026.

Previous wording

•The International segment consists of the Company’s printing operations in Latin America, including operations in Colombia, Mexico and Peru, as well as operations in Europe, including operations in England, France, Germany and Poland, until the European operations were sold on February 28, 2025. This segment provides printed products and marketing and other complementary services consistent with the United States Print and Related Services segment. The International segment accounted for approximately 9% of the Company’s consolidated net sales during the three months ended March 31, 2026.

Current wording

•The International segment consists of the Company’s printing operations in Latin America, including operations in Colombia, Mexico and Peru, as well as operations in Europe, including operations in England, France, Germany and Poland, until the European operations were sold on February 28, 2025. This segment provides printed products and marketing and other complementary services consistent with the United States Print and Related Services segment. The International segment accounted for approximately 9% of the Company’s consolidated net sales during the three and six months ended June 30, 2026.

Previous wording

The Company remains disciplined with its net debt leverage. The Company’s consolidated debt and finance lease obligations increased by $63.2 million during the three months ended March 31, 2026, primarily due to the following: (1) $93.7 million in cash used in operating activities; (2) $13.3 million in purchases of property, plant and equipment; (3) $4.9 million in purchases of treasury stock and equity awards redeemed to pay employees’ tax obligations; and (4) $5.5 million in cash dividends, partially offset by a $56.3 million reduction in cash and cash equivalents.

Current wording

The Company remains disciplined with its net debt leverage. The Company’s consolidated debt and finance lease obligations increased by $30.3 million during the six months ended June 30, 2026, primarily due to the following: (1) $40.9 million in cash used in operating activities; (2) $25.3 million in purchases of property, plant and equipment; (3) $10.2 million in cash dividends; and (4) $7.0 million in purchases of treasury stock and equity awards redeemed to pay employees’ tax obligations, partially offset by a $55.9 million reduction in cash and cash equivalents.

Previous wording

Integrated distribution with the United States Postal Service (“USPS”) is an important component of the Company’s business. Any material change in the current postage rates or service levels provided by the postal service could impact the demand that clients have for print services. In 2025, the USPS significantly reduced their service standards with the first phase of changes taking effect on April 1, 2025, and the second phase took effect July 1, 2025. In addition to the reduced service standards, the USPS has also issued reduced service performance targets for 2025. Almost all letters and flats targets were reduced, some as much as 15% lower than 2024 targets (i.e. First Class Letters three to five day on time performance target was reduced from 90% down to 80%). The USPS, however, did not meet these reduced performance standards and targets, and has kept the performance targets for 2026 essentially in line with 2025, with a few minor adjustments.

Current wording

Integrated distribution with the United States Postal Service (“USPS”) is an important component of the Company’s business. Any material change in the current postage rates or service levels provided by the postal service could impact the demand that clients have for print services. In 2025, the USPS significantly reduced their service standards which have been in place for a full year. The reduced service standards also included reduced service performance targets for 2025 which remain largely unchanged for 2026. In 2025, the USPS did not meet these reduced performance standards and targets, and while minor improvements have occurred, consistent service performance continues to be a challenge.

Previous wording

The USPS continues to experience financial problems. The passing of the Postal Service Reform Act of 2022, signed in April 2022, gave the USPS considerable financial relief as well as significant other relief over the next ten years. While the legislative postal reform helps considerably, without decreased operational cost structures, increased efficiencies or increased volumes and revenues, these losses are expected to continue into the future. As a result of these financial difficulties, the USPS has continued to adjust its postal rates and service levels. During March 2026, the USPS announced an 8% temporary increase on Ground Advantage and Priority Mail that started on April 26, 2026 and will continue until January 17, 2027. Additionally, the USPS proposed their once a year Market Dominant price increase in April 2026 to go into effect in July 2026, which will result in an overall price increase of approximately 5%.

Current wording

The USPS continues to experience financial problems. The passing of the Postal Service Reform Act of 2022, signed in April 2022, gave the USPS considerable financial relief as well as significant other relief over the next ten years. While the legislative postal reform helps considerably, without decreased operational cost structures, increased efficiencies or increased volumes and revenues, these losses are expected to continue into the future. As a result of these financial difficulties, the USPS has continued to adjust its postal rates and service levels. During March 2026, the USPS announced an 8% temporary increase on Ground Advantage and Priority Mail that started on April 26, 2026 and will continue until January 17, 2027. Additionally, the USPS Market Dominant price increase was approved by the Postal Regulatory Commission (PRC) and went into effect on July 12, 2026. On June 30, 2026 the USPS 10% catalog insights promotions officially came to an end. The combination of this promotion ending combined with the USPS annual price increase is expected to have a negative impact on catalog volumes for the remainder of 2026.

Previous wording

Federal statute requires the Postal Regulatory Commission (PRC) to conduct reviews of the overall rate-making structure for the USPS to ensure funding stability. As a result of those reviews, the PRC authorized a five year rate-making structure that provides the USPS with additional pricing flexibility over the Consumer Price Index (“CPI”) cap, which has resulted in a substantially altered rate structure for mailers. The revised rate authority that is effective as a result of the rules issued by the PRC, includes a higher overall rate cap on the USPS’ ability to increase rates from year to year. This will continue to lead to price spikes for mailers and may also reduce the incentive for the USPS to continue to take out costs and instead continue to rely on postage increases, including those noted above, as it attempts to cover its costs.

Current wording

Federal statute requires the PRC to conduct reviews of the overall rate-making structure for the USPS to ensure funding stability. As a result of those reviews, the PRC authorized a five year rate-making structure that provides the USPS with additional pricing flexibility over the Consumer Price Index (“CPI”) cap, which has resulted in a substantially altered rate structure for mailers. The revised rate authority that is effective as a result of the rules issued by the PRC, includes a higher overall rate cap on the USPS’ ability to increase rates from year to year. This will continue to lead to price spikes for mailers and may also reduce the incentive for the USPS to continue to take out costs and instead continue to rely on postage increases, including those noted above, as it attempts to cover its costs.

Previous wording

Given the significant amount of concern that has been expressed by the mailing industry, in April 2024, the PRC opened a proceeding to start the next rate system review, which includes a phased approach of proposing changes to improve rate predictability. The USPS did not implement a Market Dominant product price increase for January 2025. However, the available rate authority was rolled forward to July 2025, where approximately 8% postage increases were implemented and significantly exceeded CPI. On January 13, 2026, the PRC issued a final rule that restricts the USPS to one price change a year on Market Dominant products from 2026 to 2030. This decision is currently being appealed by the USPS. On December 22, 2025, the USPS filed a petition with the PRC, requesting new rules on Market Dominant rates to either eliminate the price cap and give full rate authority to the Board of Governors, or if a price cap continues to be required, allow a rate reset with a conservative 22% banked authority for the USPS to use. This remains open and is unknown how the PRC will respond. The PRC also refined some rules around work-share discounts that will keep these discounts more closely aligned with the costs avoided.

Current wording

Given the significant amount of concern that has been expressed by the mailing industry, in April 2024, the PRC opened a proceeding to start the next rate system review, which includes a phased approach of proposing changes to improve rate predictability. On January 13, 2026, the PRC issued a final rule that restricts the USPS to one price change a year on Market Dominant products from 2026 to 2030. While this decision was welcomed by the mailing industry, it is currently being appealed by the USPS. On December 22, 2025, the USPS filed a petition with the PRC, requesting new rules on Market Dominant rates to either eliminate the price cap and give full rate authority to the Board of Governors, or if a price cap continues to be required, allow a rate reset with a conservative 22% banked authority for the USPS to use. This remains open and is unknown how the PRC will respond, but a second phase of rulings could occur in the second half of 2026.

Previous wording

The Company’s operating income, operating margin, net earnings (computed using a 25% normalized tax rate for all items subject to tax) and diluted earnings per share for the three months ended March 31, 2026, changed from the three months ended March 31, 2025, as follows (dollars in millions, except margin and per share data):

Current wording

The Company’s operating income, operating margin, net earnings (loss) (computed using a 25% normalized tax rate for all items subject to tax) and diluted earnings (loss) per share for the three months ended June 30, 2026, changed from the three months ended June 30, 2025, as follows (dollars in millions, except margin and per share data):

Previous wording

(1)Restructuring, impairment and transaction-related charges, net increased $1.8 million ($1.4 million, net of tax), to $8.4 million during the three months ended March 31, 2026, and included the following:

Current wording

(1)Restructuring, impairment and transaction-related charges, net increased $0.5 million ($0.4 million, net of tax), to $9.7 million during the three months ended June 30, 2026, and included the following:

Previous wording

a. A $3.7 million increase in employee termination charges from $0.7 million during the three months ended March 31, 2025, to $4.4 million during the three months ended March 31, 2026;

Current wording

a. A $0.9 million increase in employee termination charges from $5.8 million during the three months ended June 30, 2025, to $6.7 million during the three months ended June 30, 2026;

Previous wording

b. A $0.1 million decrease in impairment charges from $0.3 million during the three months ended March 31, 2025, to $0.2 million during the three months ended March 31, 2026;

Current wording

b. A $3.4 million decrease in impairment charges from $4.2 million during the three months ended June 30, 2025, to $0.8 million during the three months ended June 30, 2026;

Previous wording

d. A $0.4 million increase in integration costs from zero during the three months ended March 31, 2025, to $0.4 million during the three months ended March 31, 2026; and

Current wording

d. A $0.1 million increase in integration costs from $0.2 million during the three months ended June 30, 2025, to $0.3 million during the three months ended June 30, 2026; and

Previous wording

e. A $0.2 million increase in various other restructuring charges from $3.0 million during the three months ended March 31, 2025, to $3.2 million during the three months ended March 31, 2026.

Current wording

e. A $2.9 million increase in various other restructuring charges from $1.4 million of income during the three months ended June 30, 2025, to $1.5 million of expense during the three months ended June 30, 2026.

Previous wording

(3)Interest expense decreased $2.4 million ($1.8 million, net of tax) during the three months ended March 31, 2026, to $10.0 million. This was primarily due to lower average debt levels and lower weighted average interest rates on borrowings in the three months ended March 31, 2026, as compared to the three months ended March 31, 2025.

Current wording

(3)Interest expense decreased $4.3 million ($3.3 million, net of tax) during the three months ended June 30, 2026, to $8.9 million. This change was primarily due to lower average debt levels and a lower weighted average interest rate on borrowings in the three months ended June 30, 2026, as compared to the three months ended June 30, 2025.

Previous wording

(4)Net pension (income) expense increased $0.6 million ($0.4 million, net of tax) during the three months ended March 31, 2026, from $0.4 million of expense to $0.2 million of income. This was due to a $1.7 million decrease from interest cost on pension plan liabilities and a $0.2 million decrease in the amortization of actuarial loss, partially offset by $1.3 million decrease from the expected long-term return on pension plan assets.

Current wording

(4)Net pension expense decreased $0.5 million ($0.4 million, net of tax) during the three months ended June 30, 2026, from $0.3 million of expense to $0.2 million of income. This was due to a $1.7 million decrease from interest cost on pension plan liabilities and a $0.1 million decrease in the amortization of actuarial loss, partially offset by a $1.3 million decrease from the expected long-term return on pension plan assets.

Previous wording

Cost of product sales decreased $36.8 million, or 8.9%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to the following: (1) the impacts from decreased print product sales; (2) a decrease in paper costs due to the decrease in paper sales; (3) impacts from improved manufacturing productivity; and (4) other cost reduction initiatives.

Current wording

Cost of product sales increased $7.2 million, or 2.0%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, primarily due to an increase in paper costs due to the increase in paper sales.

Previous wording

Selling, general and administrative expenses decreased $5.1 million, or 6.1%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to $7.4 million in lower employee-related costs and savings from other cost reduction initiatives, partially offset by a $1.1 million decrease in favorable foreign exchange impacts. Selling, general and administrative expenses as a percentage of net sales increased to 13.5% for the three months ended March 31, 2026, compared to 13.3% for the three months ended March 31, 2025.

Current wording

Selling, general and administrative expenses decreased $0.6 million, or 0.7%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, primarily due to the following: (1) $2.3 million in lower employee-related costs; (2) $0.2 million in lower credit loss expense; and (3) savings from other cost reduction initiatives, partially offset by a $2.3 million decrease in favorable foreign exchange impacts. Selling, general and administrative expenses as a percentage of net sales was 13.8% for the three months ended June 30, 2026, compared to 14.0% for the three months ended June 30, 2025.

Previous wording

Depreciation and amortization decreased $1.3 million, or 6.6%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, due to a $1.5 million decrease in depreciation expense, primarily due to impacts from plant closures and from property, plant and equipment becoming fully depreciated over the past year, partially offset by a $0.2 million increase in amortization expense.

Current wording

Depreciation and amortization decreased $3.5 million, or 16.9%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, due to a $3.0 million decrease in depreciation expense, primarily due to impacts from plant closures and from property, plant and equipment becoming fully depreciated over the past year and a $0.5 million decrease in amortization expense.

Previous wording

EBITDA decreased $2.6 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to the impact of lower net sales and $1.8 million of increased restructuring, impairment and transaction-related charges, net, partially offset by impacts from improved manufacturing productivity.

Current wording

EBITDA decreased $1.8 million for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, primarily due to the impact from lower marketing services and medical services net sales and $0.5 million of increased restructuring, impairment and transaction-related charges, net.

Previous wording

A reconciliation of EBITDA to net earnings for the three months ended March 31, 2026 and 2025, was as follows:

Current wording

A reconciliation of EBITDA to net earnings (loss) for the three months ended June 30, 2026 and 2025, was as follows:

Previous wording

Operating income for the International segment increased $3.1 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to a $2.5 million decrease in restructuring, impairment and transaction-related charges, net, and a $0.6 million increase in operating income, primarily in Mexico.

Current wording

Operating income for the International segment decreased $2.0 million, or 51.3%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, primarily due to a $3.1 million increase in restructuring, impairment and transaction-related charges, net, partially offset by a $1.1 million increase in operating income, primarily in Mexico.

Previous wording

c. A $2.4 million decrease in transaction-related charges from $2.6 million during the three months ended March 31, 2025, to $0.2 million during the three months ended March 31, 2026;

Current wording

c. A $2.4 million decrease in transaction-related charges from $3.0 million during the six months ended June 30, 2025, to $0.6 million during the six months ended June 30, 2026;

Previous wording

(2)Other operating income elements decreased $0.1 million (zero net of tax impact) during the three months ended March 31, 2026, primarily due to a $1.3 million decrease in depreciation and amortization expense and impacts from improved manufacturing productivity, partially offset by the impact from lower net sales.

Current wording

(2)Other operating income elements increased $1.6 million ($1.2 million, net of tax impact) during the six months ended June 30, 2026, primarily due to a $4.8 million decrease in depreciation and amortization expense, partially offset by the impact from lower net sales.

Previous wording

(5)The $0.4 million increase in income tax expense as calculated in the following table is primarily due to a $0.9 million increase in tax expense related to the Company’s liability for audit assessments and unrecognized tax benefits and a $0.6 million increase from the impact of non-deductible expenses, partially offset by a $0.9 million decrease from valuation allowance reserves.

Current wording

(5)The $1.2 million increase in income tax expense as calculated in the following table is primarily due to the following: (1) a $1.9 million increase related to the Company’s liability for audit assessments and unrecognized tax benefits; (2) a $1.1 million increase from the impact of non-deductible expenses; and (3) a $0.7 million increase from deferred income tax on the investment in a foreign subsidiary. These increases were partially offset by a $2.1 million decrease from valuation allowance reserves.

Previous wording

Product sales decreased $38.6 million, or 7.8%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to a $34.7 million decrease in sales in the Company’s print product lines, of which $10.9 million is from the impact of the sale of the European operations, and a $7.2 million decrease in paper sales, which is net of an $8.7 million decrease as a result of the sale of the European operations on February 28, 2025, partially offset by $3.3 million in favorable foreign exchange impacts.

Current wording

Product sales decreased $34.8 million, or 3.7%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, primarily due to a $42.3 million decrease in net sales from lower print product volumes, of which $10.9 million is from the impact of the sale of the European operations, partially offset by $6.5 million in favorable foreign exchange impacts and a $1.0 million increase in paper sales, which is net of an $8.7 million decrease as a result of the sale of the European operations on February 28, 2025.

Previous wording

Service sales, which primarily consist of logistics, distribution, marketing services, imaging and medical services, decreased $9.8 million, or 7.3%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to a $6.7 million net decrease in marketing services and medical services, of which $0.3 million is a result of the sale of the European operations, and a $3.1 million decrease in logistics sales, of which $2.6 million is a result of the sale of the European operations.

Current wording

Service sales, which primarily consist of logistics, distribution, marketing services, imaging and medical services, decreased $8.0 million, or 3.1%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, primarily due to a $11.0 million net decrease in marketing services and medical services, of which $0.3 million is a result of the sale of the European operations, partially offset by a $3.0 million increase in logistics net sales, which is net of a $2.6 million decrease as a result of the sale of the European operations.

Previous wording

Cost of service sales decreased $5.1 million, or 6.0%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to the impact from lower marketing services and decreased freight volumes.

Current wording

Cost of service sales decreased $4.3 million, or 2.6%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, primarily due to the impact from lower marketing services, partially offset by increased fuel costs in logistics.

Previous wording

(c)Includes a $0.5 million loss on the sale of the European operations during the three months ended March 31, 2025.

Current wording

(d)Includes a $0.5 million loss on the sale of the European operations during the six months ended June 30, 2025.

Previous wording

Service sales for the United States Print and Related Services segment decreased $6.9 million, or 5.2%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to a $6.4 million net decrease in marketing services and medical services and a $0.5 million decrease in logistics sales.

Current wording

Service sales for the United States Print and Related Services segment decreased $5.1 million, or 2.0%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, primarily due to a $10.7 million net decrease in marketing services and medical services, partially offset by a $5.6 million increase in logistics net sales.

Previous wording

Operating income for the United States Print and Related Services segment decreased $5.6 million, or 17.7%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to a $4.2 million increase in restructuring, impairment and transaction-related charges, net and the impact from decreased net sales, partially offset by a $1.3 million decrease in depreciation and amortization expense and the impacts from improved manufacturing productivity.

Current wording

Operating income for the United States Print and Related Services segment decreased $1.7 million, or 3.1%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, primarily due to a $1.4 million increase in restructuring, impairment and transaction-related charges, net and the impact from decreased net sales, partially offset by a $3.8 million decrease in depreciation and amortization expense.

Previous wording

The operating margin for the United States Print and Related Services segment decreased to 4.9% for the three months ended March 31, 2026, compared to 5.7% for the three months ended March 31, 2025, primarily due to the reasons provided above.

Current wording

The operating margin for the United States Print and Related Services segment decreased to 5.0% for the six months ended June 30, 2026, compared to 5.1% for the six months ended June 30, 2025, primarily due to the reasons provided above.

Previous wording

Product sales for the International segment decreased $22.7 million, or 31.2%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, due to a $16.0 million decrease in print volume, of which $10.9 million is a result of the sale of the European operations, and a $10.0 million decrease in paper sales, of which $8.7 million is a result of the sale of the European operations, partially offset by $3.3 million favorable foreign exchange impacts, primarily in Mexico.

Current wording

Product sales for the International segment decreased $18.6 million, or 15.5%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, due to a $16.0 million decrease in net sales from lower print product volume, of which $10.9 million is a result of the sale of the European operations, and a $9.1 million decrease in paper sales, of which $8.7 million is a result of the sale of the European operations, partially offset by $6.5 million favorable foreign exchange impacts, primarily in Mexico.

Previous wording

Service sales for the International segment decreased $2.9 million, or 100.0%, for the three months ended March 31, 2026, when compared to the three months ended March 31, 2025, primarily due to a $2.6 million decrease in logistics sales and $0.3 million decrease in marketing service sales, both as a result of the sale of the European operations.

Current wording

Service sales for the International segment decreased $2.9 million, or 100.0%, for the six months ended June 30, 2026, when compared to the six months ended June 30, 2025, primarily due to a $2.6 million decrease in logistics net sales and $0.3 million decrease in marketing service net sales, both as a result of the sale of the European operations.

Previous wording

(b)Includes a $0.5 million loss on the sale of the European operations during the three months ended March 31, 2025.

Current wording

(b)Includes a $0.5 million loss on the sale of the European operations during the six months ended June 30, 2025.

Previous wording

Corporate operating expenses decreased $0.6 million, or 4.7%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025 primarily due to a $0.9 million decrease in employee-related costs, partially offset by a $0.1 million increase in restructuring, impairment and transaction-related charges, net.

Current wording

Corporate operating expenses increased $0.1 million, or 0.4%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, primarily due to a $0.3 million increase in restructuring, impairment and transaction-related charges, net, partially offset by a $0.4 million decrease in employee-related costs.

Previous wording

The Company utilizes cash flows from operating activities and borrowings under its credit facilities to satisfy its liquidity and capital requirements. The Company had total liquidity of $250.9 million as of March 31, 2026, which consisted of up to $243.9 million of unused capacity under its revolving credit agreement, which was net of $23.8 million of issued letters of credit, and cash and cash equivalents of $7.0 million. Total liquidity is reduced to$177.4 million under the Company’s most restrictive debt covenants. There were $71.9 million of borrowings under the $339.6 million revolving credit facility as of March 31, 2026.

Current wording

The Company utilizes cash flows from operating activities and borrowings under its credit facilities to satisfy its liquidity and capital requirements. The Company had total liquidity of $275.9 million as of June 30, 2026, which consisted of up to $268.5 million of unused capacity under its revolving credit agreement, which was net of $23.6 million of issued letters of credit, and cash and cash equivalents of $7.4 million. Total liquidity is reduced to$208.6 million under the Company’s most restrictive debt covenants. There were $47.5 million of borrowings under the $339.6 million revolving credit facility as of June 30, 2026.

Previous wording

Net cash used in operating activities increased $4.7 million, from $89.0 million for the three months ended March 31, 2025, to $93.7 million for the three months ended March 31, 2026. This increase was due to a $2.4 million decrease in cash from earnings and a $2.3 million increase in cash used in changes in operating assets and liabilities.

Current wording

Net cash used in operating activities decreased $0.7 million, from $41.6 million for the six months ended June 30, 2025, to $40.9 million for the six months ended June 30, 2026. This decrease was due to a $1.0 million decrease in cash used in changes in operating assets and liabilities, partially offset by a $0.3 million decrease in cash from net earnings and the related non-cash adjustments.