SUSSEX, Wisc. (News release) -- Quad/Graphics, Inc., a marketing experience company that solves complex marketing challenges for its clients, today reported results for the second quarter ended June 30, 2025.

Recent Highlights

• Realized Net Sales of $572 million in the second quarter of 2025 compared to $634 million in the second quarter of 2024, representing a 10% decline in Net Sales. Net Sales declined 4% when excluding the 6% impact of the February 28, 2025, divestiture of the Company's European operations.
• Recognized Net Loss of $0.1 million or $0.00 Diluted Loss Per Share in the second quarter of 2025, compared to a Net Loss of $3 million or $0.06 Diluted Loss Per Share in 2024.
• Achieved Non-GAAP Adjusted EBITDA of $43 million in the second quarter of 2025, compared to $52 million in 2024.
• Reported $0.14 Adjusted Diluted Earnings Per Share in the second quarter of 2025, increased from $0.12 per share in 2024.
• Released Audience Builder 2.0, continuing to activate Quad's proprietary household-based data stack with clients to enhance media buying with precision at scale and to increase response rates through improved audience intelligence.
• Announced In-Store Connect retail media network partnership with Vallarta Supermarkets, one of California's leading Latino-owned grocery chains.
• Repurchased 1.4 million shares of Quad Class A common stock in 2025, bringing total repurchases to 7.3 million shares since commencing buybacks in 2022, representing approximately 13% of Quad's March 31, 2022, outstanding shares.
• Declared quarterly dividend of $0.075 per share.
• Reaffirms full-year 2025 financial guidance.

Joel Quadracci, Chairman, President and Chief Executive Officer of Quad, said: "Second quarter and year-to-date results met our expectations as we continue to differentiate ourselves as a marketing experience company that simplifies the complexities of marketing for brands and marketers. This includes ongoing investments in strategic growth areas such as data and audience intelligence, AI-enabled tools and systems, and our In-Store Connect retail media network. We remain confident in Quad's vision and our ability to unlock diversified growth, improve print and marketing efficiencies, and create value for our stakeholders.

"Marketers increasingly rely on audience intelligence to drive stronger campaign outcomes and quantifiable ROI, and Quad's proprietary household-based data stack gives us a competitive edge. We are actively applying our AI-powered data stack to client work across all channels--digital and physical. With strategic insights on 92% of U.S. households--including demographic, transactional, attitudinal and behavioral characteristics as well as personal interests or, what we call, passions--we are able to connect the right message with the right audience at the right time and in the right channels. In the quarter, we launched Audience Builder 2.0, an AI-powered tool that enables Quad employees to easily create complex, high-propensity audiences. This represents a significant milestone in data activation.

"We continue to grow our In-Store Connect retail media network among mid-market grocers and CPG brands seeking deeper engagement with high-value shopper audiences. We recently signed a new partnership with Vallarta, one of California's leading Latino-owned grocery chains, and doubled our footprint with The Save Mart Companies. Campaigns leveraging In-Store Connect have been shown to drive greater brand awareness and product sales--especially when promotional offers are included--and also boost sales across entire product categories. Through our solution, we continue to help brick-and-mortar retailers adapt their marketing strategies and tactics to keep pace with an ever-evolving media landscape."

Added Tony Staniak, Chief Financial Officer of Quad: "Despite ongoing uncertainties in the macroeconomic environment, we are reaffirming our 2025 guidance. We will continue to closely monitor the potential impacts of tariffs and inflationary pressures, as well as postal rate increases, on our clients while investing in innovative offerings to achieve our long-term financial goals, including net sales growth. Additionally, with our balanced capital allocation we have returned $15 million of capital to shareholders thus far in 2025 through our quarterly dividend of $0.075 per share and share repurchases. Year-to-date, we repurchased 1.4 million shares, bringing total repurchases to 7.3 million shares since commencing buybacks in 2022, representing approximately 13% of our March 31, 2022, outstanding shares. Our next quarterly dividend is payable September 5, 2025, and we expect to continue to be opportunistic in terms of future share repurchases."

Second Quarter 2025 Financial Results

• Net Sales were $572 million in the second quarter of 2025, a decrease of 10% compared to the same period in 2024. Excluding the 6% impact of the divestiture of the Company's European operations, Net Sales declined 4%. The decline in Net Sales was primarily due to lower paper and logistics sales.
• Net Loss was $0.1 million, or $0.00 Diluted Loss Per Share, in the second quarter of 2025 compared to Net Loss of $3 million, or $0.06 Diluted Loss Per Share, in the second quarter of 2024. The improvement was primarily due to lower selling, general and administrative expenses, lower depreciation and amortization, lower interest expense, benefits from increased manufacturing productivity and savings from cost reduction initiatives, partially offset by the impact from lower Net Sales, increased investments in innovative offerings to drive future revenue growth, and the divestiture of the Company's European operations.
• Adjusted EBITDA was $43 million in the second quarter of 2025 as compared to $52 million in the same period in 2024. The decrease was primarily due to the impact of lower sales, increased investments in innovative offerings to drive future revenue growth, and the divestiture of the Company's European operations, partially offset by lower selling, general and administrative expenses, benefits from improved manufacturing productivity and savings from cost reduction initiatives.
• Adjusted Diluted Earnings Per Share was $0.14 in the second quarter of 2025, as compared to $0.12 in the second quarter of 2024.

Year-to-Date 2025 Financial Results

• Net Sales were $1.2 billion in the six months ended June 30, 2025, a decrease of 7% compared to the same period in 2024. Excluding the 4% impact of the divestiture of the Company's European operations, Net Sales declined 3%. The decline in Net Sales was primarily due to lower paper sales and lower logistics and agency solutions sales, including the loss of a large grocery client.
• Net Earnings were $6 million, or $0.11 Diluted Earnings Per Share, in the six months ended June 30, 2025, compared to Net Loss of $31 million, or $0.65 Diluted Loss Per Share, in the same period in 2024. The improvement was primarily due to lower restructuring, impairment and transaction-related charges, lower depreciation and amortization, lower selling, general and administrative expenses, lower interest expense, benefits from increased manufacturing productivity and savings from cost reduction initiatives, partially offset by the impact from lower Net Sales, increased investments in innovative offerings to drive future revenue growth, and the divestiture of the Company's European operations.
• Adjusted EBITDA was $89 million in the six months ended June 30, 2025, as compared to $102 million in the same period in 2024. The decrease was primarily due to the impact of lower sales, increased investments in innovative offerings to drive future revenue growth, and the divestiture of the Company's European operations, partially offset by lower selling, general and administrative expenses, benefits from improved manufacturing productivity and savings from cost reduction initiatives.
• Adjusted Diluted Earnings Per Share was $0.34 in the six months ended June 30, 2025, as compared to $0.22 in the same period in 2024.
• Net Cash Used in Operating Activities was $42 million in the six months ended June 30, 2025, compared to $48 million in the six months ended June 30, 2024. Free Cash Flow improved $16 million from last year to negative $66 million in the six months ended June 30, 2025, and included $34 million of Free Cash Flow Generation in the second quarter of 2025. The increase in Free Cash Flow was primarily due to higher cash earnings, including lower restructuring payments and lower interest payments, and a $9 million decrease in capital expenditures. As a reminder, the Company historically generates most of its Free Cash Flow in the fourth quarter of the year.
• Net Debt was $448 million at June 30, 2025, as compared to $350 million at December 31, 2024 and $532 million at June 30, 2024. Compared to December 31, 2024, Net Debt increased primarily due to seasonally negative $66 million of Free Cash Flow in the six months ended June 30, 2025, a $16 million payment for the Enru co-mailing asset acquisition and $15 million return of capital to shareholders through share repurchases and dividends.

Dividend

Quad's next quarterly dividend of $0.075 per share will be payable on September 5, 2025, to shareholders of record as of August 18, 2025.

2025 Guidance

The Company's full-year 2025 financial guidance is unchanged and is as follows: