Company: DLX
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0000027996-25-000189
Chunk: 127

Company: DELUXE CORP
Filing Date: 2025-11-06
Form: 10-Q
Item: Item 2
Chunk 127
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 offset these challenges, as we continued to emphasize operating expense discipline and overall efficiency within this segment. Additionally, bad debt expense declined year-over-year.

Adjusted EBITDA margin for the third quarter and first nine months of 2025 increased compared to the same periods in 2024, as the benefits from our pricing and cost management actions, a shift toward check revenues, and the lower bad debt expense contributed positively. These factors more than offset the inflationary cost pressures.

CASH FLOWS AND LIQUIDITY

As of September 30, 2025, we held cash and cash equivalents of $26 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 $38 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.

 Nine Months Ended September 30,(in thousands)20252024ChangeNet cash provided by operating activities$168,521 $134,122 $34,399 Net cash used by investing activities(76,021)(51,323)(24,698)Net cash used by financing activities(339,258)(452,081)112,823 Effect of exchange rate change on cash, cash equivalents, restricted cash, and restricted cash equivalents1,230 (3,156)4,386 Net change in cash, cash equivalents, restricted cash, and restricted cash equivalents$(245,528)$(372,438)$126,910 Free cash flow(1)$95,965 $64,345 $31,620 

(1) See Reconciliation of Non-GAAP Financial Measures within the Consolidated Results of Operations section, which defines and illustrates how we calculate free cash flow.

Net cash provided by operating activities increased $34 million for the first nine months of 2025 compared to the first nine months of 2024. Key contributors included the positive impacts of our pricing and cost management actions, a $15 million reduction in payouts for performance-based employee bonuses, and lower expenditures associated with restructuring and integration activities. Additional contributions came from growth in our data-driven marketing business and positive changes in working capital, particularly within other current assets and prepaid expenses. These positive impacts were partially offset by softer demand for certain promotional products, the continuing secular declines in the Print segment, variations in the timing of accounts payable settlements, inflationary pressures on our cost structure, and the impact of