Company: DLX
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0000027996-25-000189
Chunk: 100

Company: DELUXE CORP
Filing Date: 2025-11-06
Form: 10-Q
Item: Item 8
Chunk 100
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 These charges included professional services fees, employee severance, and other restructuring-related costs.

The majority of the employee reductions included in our restructuring and integration accruals as of September 30, 2025, along with the related severance payments, are expected to be completed by mid-2026. As a result of these employee reductions, we expect to realize annual cost savings of approximately $6 million in cost of sales and $14 million in SG&A expense in 2025, in comparison to our 2024 results of operations. Note that these savings do not reflect all of our cost saving actions and they may be offset by increased labor and other costs, including inflationary impacts and investments in the business.

SEGMENT RESULTS

 We operate four reportable business segments: Merchant Services, B2B Payments, Data Solutions, and Print. Our segments are generally organized by product and service type and reflect the way we manage the business. The financial information presented below is consistent with that presented under the caption "Note 13: Business Segment Information" in the Condensed Notes to Unaudited Consolidated Financial Statements located in Part 1, Item 1 of this report, where information regarding revenue from our various product and service offerings can also be found.

Merchant Services

Results for our Merchant Services segment were as follows:

 Quarter Ended September 30,Nine Months Ended September 30,(in thousands)20252024Change20252024ChangeTotal revenue$98,000 $93,531 4.8%$297,173 $288,536 3.0%Adjusted EBITDA20,390 17,752 14.9%63,505 58,377 8.8%Adjusted EBITDA margin20.8%19.0%1.8 pts.21.4%20.2%1.2 pts.

Total revenue for the third quarter and first nine months of 2025 increased compared to the same periods in 2024, due to the positive impact of modest pricing actions implemented in response to inflation. Additionally, there was volume growth for government clients and within the banking channel. These gains were partially offset by pressure on processing volumes driven by the uncertain domestic economic outlook and the resulting pressure on discretionary spending.

Adjusted EBITDA and adjusted EBITDA margin for the third quarter and first nine months of 2025 increased compared to the same periods in 2024, as price increases and cost management actions more than offset the impact of changes in channel mix. While