Donnelley Financial Solution | 8-K: FY2025 Q2 Revenue Misses Estimate at USD 218.1 M

Revenue: As of FY2025 Q2, the actual value is USD 218.1 M, missing the estimate of USD 225.53 M.

EPS: As of FY2025 Q2, the actual value is USD 1.28, beating the estimate of USD 1.26.

EBIT: As of FY2025 Q2, the actual value is USD 48.7 M.

Segment Revenue

• Software Solutions: Net sales of $92.2 million, a 7.7% increase from the second quarter of 2024, accounting for 42.3% of total net sales.
• Tech-enabled Services: Net sales of $85.2 million, a decrease from $102.2 million in the second quarter of 2024.
• Print and Distribution: Net sales of $40.7 million, down from $54.9 million in the second quarter of 2024.

Operational Metrics

• Net Earnings: $36.1 million, or $1.28 per diluted share, compared to $44.1 million, or $1.47 per diluted share, in the second quarter of 2024.
• Adjusted EBITDA: $76.3 million, a decrease of $10.9 million from the second quarter of 2024, with an Adjusted EBITDA margin of 35.0%.
• Gross Margin: 57.0%, down from 58.7% in the second quarter of 2024.
• Operating Margin: 24.2%, compared to 26.6% in the second quarter of 2024.

Cash Flow

• Operating Cash Flow: Increased by $12.2 million from the second quarter of 2024.
• Free Cash Flow: Increased by $14.9 million from the second quarter of 2024.

Unique Metrics

• Gross Leverage: 0.9x and net leverage of 0.7x as of June 30, 2025.
• Share Repurchase: 787,152 shares repurchased for approximately $34.3 million at an average price of $43.56 per share.

Outlook / Guidance

• Third-Quarter Guidance: Total net sales expected to be between $165 million and $175 million, with an Adjusted EBITDA margin of 23% to 25%.
• Capital Markets Transactional Net Sales: Expected to be between $35 million and $40 million.