Cimpress plc

10/29/2026 | Press release | Distributed by Public on 10/29/2026 15:25

Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations
This Report contains forward-looking statements that involve risks and uncertainties. The statements contained in this Report that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including but not limited to our statements about the anticipated growth and development of our businesses and financial results, the impact of interest rate and currency fluctuations, the impact of U.S. tariffs (including potential changes in related trade policies and potential mitigation actions and related estimates, cost impacts, pricing changes and changes in customer demand), sources of liquidity to fund future operations, future payment terms with suppliers, the timing of adoption of certain accounting standards, legal proceedings, our ability to prevail in our appeal of an adverse land duty tax assessment, indefinitely reinvested earnings, unrecognized tax benefits, our effective tax rate, and sufficiency of our tax reserves. Without limiting the foregoing, the words "may," "should," "could," "expect," "plan," "intend," "anticipate," "believe," "estimate," "predict," "assume," "designed," "potential," "possible," "continue," "target," "seek," "likely," "will" and similar expressions are intended to identify forward-looking statements. All forward-looking statements included in this Report are based on information available to us up to, and including the date of this document, and we disclaim any obligation to update any such forward-looking statements. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various important factors, including but not limited to flaws in the assumptions and judgments upon which our forecasts and estimates are based; the development, severity, and duration of supply chain constraints and fluctuating inflation; our inability to make investments in our business and allocate our capital as planned or the failure of those investments and allocations to achieve the results we expect; costs and disruptions caused by acquisitions and minority investments; the failure of businesses we acquire or invest in to perform as expected; the failure to realize anticipated synergies between our existing businesses and recently acquired businesses; loss of key personnel or our inability to recruit talented personnel; our failure to develop and deploy our mass customization platform or the failure of the mass customization platform to drive the performance, efficiencies and competitive advantage we expect; unanticipated changes in our markets, customers, or businesses; disruptions caused by geopolitical events or political instability and war in Ukraine, Israel, the Middle East or elsewhere; changes in governmental policies, laws and regulations, or in the enforcement or interpretation of governmental policies, laws and regulations, that affect our businesses, including related to import tariffs; our failure to manage the growth and complexity of our business; our failure to maintain compliance with the covenants in our debt documents or to pay our debts when due; competitive pressures; general economic conditions; and other factors described in Item 1A (Risk Factors) of our Annual Report on Form 10-K for the fiscal year ended June 30, 2026, as updated, if applicable, by this Report on Form 10-Q and the documents that we periodically file with the SEC.
Executive Overview
Cimpress helps millions of businesses build brands, stand out, and grow via customized physical marketing products and branded merchandise. Cimpress is the global leader in web-to-print mass customization, delivering high-quality, affordable custom products quickly and conveniently, even in low quantities. Our products and services include a broad range of marketing materials, business cards, signage, promotional products, logo apparel, packaging, books and magazines, wall decor, photo merchandise, invitations and announcements, design and digital marketing services, and other categories. Mass customization is a core element of the business model of each Cimpress business and is a competitive strategy that seeks to produce goods and services to meet individual customer needs with near mass production efficiency.
As of September 30, 2026, we have numerous operating segments under our management reporting structure that are reported in the following five reportable segments: VistaPrint, PrintBrothers, The Print Group, National Pen, and All Other Businesses. Our All Other Businesses includes the results from the launch of our new strategic partnership with Canva, who is one of the world's largest design platforms. Refer to Note 12 in our accompanying consolidated financial statements for additional information relating to our reportable segments and our segment financial measures.
Financial Summary
The primary financial metric by which we set quarterly and annual budgets both for individual businesses and Cimpress wide is our adjusted free cash flow before net cash interest payments; however, in evaluating the financial condition and operating performance of our business, management considers a number of metrics including revenue growth, constant-currency revenue growth, organic constant-currency revenue growth (which excludes the impact of acquisitions/divestitures), operating income, net income, adjusted EBITDA, cash flow from operations, and adjusted free cash flow. Reconciliations of our non-GAAP financial measures are included within
the "Consolidated Results of Operations" and "Additional Non-GAAP Financial Measures" sections of Management's Discussion and Analysis. A summary of these key financial metrics for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025 follows:
•Revenue increased by 8% to $934.1 million.
•Organic constant-currency revenue growth (a non-GAAP financial measure) was 2%.
•Operating income decreased by $23.0 million to $26.0 million.
•Net (loss) income decreased by $7.5 million to a loss of $1.0 million.
•Adjusted EBITDA (a non-GAAP financial measure) decreased by $8.9 million to $89.8 million.
•Diluted net (loss) income per share attributable to Cimpress plc decreased by $0.41 to a loss of $0.11.
•Cash provided by operating activities increased by $3.9 million to $28.9 million.
•Adjusted free cash flow (a non-GAAP financial measure) increased by $8.5 million to an outflow of $9.3 million.
For the three months ended September 30, 2026, the increase in reported revenue was driven by revenue contributions from our recently acquired businesses and external organic constant-currency growth across most of our reportable segments. Across our businesses, we continue to see stronger growth across our assortment of elevated products, while volume pressure continues to exist in certain legacy product categories alongside continued declines in select sales channels, including resellers in certain European markets.
Operating income decreased by $23.0 million to $26.0 million for the three months ended September 30, 2026. The decrease was driven in part by items that negatively impacted gross profit, including $5.9 million of planned higher net start-up costs for our North American manufacturing network, $5.8 million in increased depreciation and amortization, primarily tied to recent manufacturing equipment investments, $4.2 million from the net impact of duties and new Section 338 and 301 tariffs on certain goods sold to U.S. customers, and $1.8 million in higher energy-related input costs, net of pricing increases. These costs were partially offset by a $7.5 million benefit from tariff refunds related to previously incurred costs. Operating income was also impacted by $3.7 million of increased restructuring charges related to cost reductions that will benefit future periods, $1.4 million from the non-recurrence of a compensation benefit in the year-ago period, and $0.7 million of increased amortization related to recent acquisitions.
Net (loss) income decreased $7.5 million during the three months ended September 30, 2026, as compared to the prior year. The net (loss) income decrease was driven by the operating income decline described above, partially offset by higher unrealized hedging gains and lower income tax expenses.
Adjusted EBITDA decreased by $8.9 million during the three months ended September 30, 2026, for similar reasons as the decrease in operating income as described above, with the exception of depreciation and amortization expense and restructuring charges that are excluded from adjusted EBITDA. Partially offsetting the decrease is year-over-year currency benefits of $1.7 million. Tuck-in acquisitions within the PrintBrothers and The Print Group reportable segments contributed $3.3 million to adjusted EBITDA, net of transaction-related costs, for the three months ended September 30, 2026.
During the three months ended September 30, 2026, cash from operations increased $3.9 million year over year, driven by a decrease of cash interest and tax payments of $1.4 million and $1.1 million, respectively, as well as favorable changes year-over-year in net working capital that is driven mostly by timing items. These items were partially offset by the operating income decrease described above.
Adjusted free cash flow increased by $8.5 million for the three months ended September 30, 2026, primarily driven by the increase in cash flow from operations as described above and a $3.6 million decrease in capital expenditures mainly driven by the timing of cash payments, and a $0.9 million decrease in capitalized software and website development costs.
Refer to the "Additional Non-GAAP Financial Measures" section of Management's Discussion and Analysis for the reconciliation of our non-GAAP financial measures.
U.S. Tariffs
The U.S. tariff environment remains volatile. The most recent developments include the U.S. government's implementation of broad-based Section 301 tariffs of 10% to 12.5% that replaced the 10% global rate that expired. Also, a 50% tariff on certain Canadian goods under Section 338 took effect on August 22, 2026. The Section 338
tariffs affect a small portion of products fulfilled in Canada for U.S. customers, and we are actively operationalizing supply chain and fulfillment adjustments to mitigate a substantial portion of any prospective cost impact.
During the first quarter of fiscal year 2027, we continued filing refund requests for IEEPA-based tariffs and recognized a benefit within cost of revenue in the amount of $7.5 million, which included all submitted and accepted Phase 2 IEEPA tariff refunds. We have not recognized any benefit for Phase 3 refund claims, since the acceptance and timing of the recovery of those claims remained uncertain as of September 30, 2026.
Consolidated Results of Operations
Consolidated Revenue
Our businesses generate revenue primarily from the sale and shipment of customized products. We also generate revenue, to a much lesser extent (and primarily in our VistaPrint business), from digital services, graphic design services, website design and hosting, and social media marketing services, as well as a small percentage of revenue from order referral fees and other third-party offerings. For additional discussion relating to segment revenue results, refer to the "Reportable Segment Results" section included below.
Total revenue and revenue growth by reportable segment for the three months ended September 30, 2026 and 2025 are shown in the following tables. The revenue by reportable segment includes inter-segment transactions, which is when one Cimpress business chooses to buy from or sell to another Cimpress business that is part of a different reportable segment. These transactions are eliminated in the inter-segment elimination line in the tables below.
In thousands Three Months Ended September 30, Currency
Impact: 		Constant-
Currency 		Impact of Acquisitions/Divestitures: Constant- Currency Revenue Growth
2026 2025 %
Change 		(Favorable)/Unfavorable Revenue Growth (1) (Favorable)/Unfavorable Excluding Acquisitions/Divestitures (2)
VistaPrint
$ 464,412 $ 454,909 2% -% 2% -% 2%
PrintBrothers
235,919 184,711 28% 2% 30% (25)% 5%
The Print Group
109,274 96,710 13% 2% 15% (13)% 2%
National Pen
104,365 103,209 1% 1% 2% -% 2%
All Other Businesses
72,492 61,742 17% -% 17% -% 17%
Inter-segment eliminations
(52,410) (38,004)
Total revenue $ 934,052 $ 863,277 8% 1% 9% (7)% 2%
_______________
(1) Constant-currency revenue growth, a non-GAAP financial measure, represents the change in total revenue between current and prior-year periods at constant-currency exchange rates by translating all non-U.S. dollar denominated revenue generated in the current period using the prior-year period's average exchange rate for each currency to the U.S. dollar. Our reportable segments-related growth is inclusive of inter-segment revenues, which are eliminated in our consolidated results.
(2) Constant-currency revenue growth excluding acquisitions/divestitures, a non-GAAP financial measure, excludes revenue results for businesses in the period in which there is no comparable year-over-year revenue. Our reportable segments-related growth is inclusive of inter-segment revenues, which are eliminated in our consolidated results.
We have provided these non-GAAP financial measures because we believe they provide meaningful information regarding our results on a consistent and comparable basis for the periods presented. Management uses these non-GAAP financial measures, in addition to GAAP financial measures, to evaluate our operating results. These non-GAAP financial measures should be considered supplemental to, and not a substitute for, our reported financial results prepared in accordance with GAAP.
For the three months ended September 30, 2026, the reported revenue growth of $70.8 million was primarily driven by $57.3 million from the addition of revenue from recently acquired businesses as compared to the prior fiscal year. Excluding the effect of changes in currency exchange rates, acquisitions, and inter-segment revenue, the largest increase in revenue was from our PrintBrothers business with an increase of $9.0 million for the three months ended September 30, 2026, partly driven by order volume growth. Additionally, our All Other Businesses reportable segment contributed $6.5 million of increased revenue for the three months ended September 30, 2026, partly driven by growth from our new strategic partnership with Canva, while our VistaPrint reportable segment contributed $6.2 million of increased revenue driven by growth in our elevated products. These items were offset in part by negative impacts from currency exchange rate fluctuations of $4.7 million.
For additional discussion relating to segment revenue results, refer to the "Reportable Segment Results" section included below.
Consolidated Cost of Revenue
Cost of revenue includes materials used by our businesses to manufacture their products, payroll and related expenses for production and design services personnel, depreciation of assets used in the production process and in support of digital marketing service offerings, shipping, handling and processing costs, third-party production and design costs, costs of free products, and other related costs of products our businesses sell.
In thousands
Three Months Ended September 30,
2026 2025
Cost of revenue $ 525,891 $ 460,476
% of revenue 56.3 % 53.3 %
For the three months ended September 30, 2026, year-over-year cost of revenue increased by $65.4 million and included $3.0 million benefit from currency exchange rate fluctuations. The increase is mostly driven by the addition of cost of revenue from our recently acquired businesses of $45.9 million. In addition, the increase in cost of revenue includes $5.9 million in increased net start-up costs for our North American manufacturing network, $5.8 million in increased depreciation and amortization, primarily tied to recent manufacturing equipment investments, and $1.8 million in higher net energy-related input costs. Cost of revenue was also impacted by $4.2 million of additional tariff costs on certain goods sold to U.S. customers, offset in part by a $7.5 million benefit from IEEPA tariff refunds related to costs previously incurred.
Consolidated Operating Expenses
The following table summarizes our comparative operating expenses for the following periods:
In thousands
Three Months Ended September 30,
2026 2025
Technology and development expense $ 86,153 $ 84,886
% of revenue 9.2 % 9.8 %
Marketing and selling expense $ 223,865 $ 210,398
% of revenue 24.0 % 24.4 %
General and administrative expense $ 63,193 $ 53,996
% of revenue 6.8 % 6.3 %
Amortization of acquired intangible assets $ 4,936 $ 4,252
% of revenue 0.5 % 0.5 %
Restructuring expense (1) $ 3,994 $ 298
% of revenue 0.4 % 0.0 %
(1) Refer to Note 14 in the accompanying consolidated financial statements for additional details.
Technology and development expense
Technology and development expense primarily consists of payroll and related expenses for employees engaged in software and manufacturing engineering, information technology operations, and content development, as well as amortization of capitalized software and website development costs, including hosting of our websites, asset depreciation, patent amortization, and other technology infrastructure-related costs. Depreciation expense for information technology equipment that directly supports the delivery of our digital marketing services products is included in cost of revenue.
For the three months ended September 30, 2026, year-over-year technology and development expense increased by $1.3 million primarily driven by higher year-over-year cash compensation costs of $1.7 million due in part by the addition of cash compensation costs from our recently acquired businesses. This increase was partially offset by a decrease of third-party technology costs of $1.0 million driven by efficiency gains from standardizing parts of our technology infrastructure and reducing our reliance on certain third-party tools.
Marketing and selling expense
Marketing and selling expense primarily consists of advertising and promotional costs; payroll and related expenses for our employees engaged in marketing, sales, customer support, and public relations activities; direct-mail advertising costs; and third-party payment processing fees. Our VistaPrint, National Pen, and BuildASign businesses have higher marketing and selling costs as a percentage of revenue as compared to our PrintBrothers and The Print Group businesses due to differences in the customers that they serve.
For the three months ended September 30, 2026, year-over-year marketing and selling expenses increased by $13.5 million partly due to the addition of $5.9 million of costs from our recently acquired businesses. In addition, the increase was driven by higher year-over-year advertising spend of $5.5 million including testing into evolving marketing channels. Despite those increases, advertising expense as a percentage of revenue declined year over year. Other cost increases included higher cash compensation costs of $1.7 million.
General and administrative expense
General and administrative expense primarily consists of transaction costs, including third-party professional fees, insurance, and payroll and related expenses of employees involved in executive management, finance, legal, strategy, human resources, and procurement.
For the three months ended September 30, 2026, year-over-year general and administrative expenses increased by $9.2 million primarily due to the addition of $5.7 million of costs from our recently acquired businesses. The increase was also driven by an increase in long-term incentive cash compensation costs of $2.7 million due to changes in the estimated payout for certain businesses, and increased share-based compensation costs of $1.2 million. These increases were partially offset by a benefit from the non-recurrence of a $1.9 million sales tax reserve recognized in the first quarter of fiscal year 2026.
Other Consolidated Results
Other income, net
Other income, net generally consists of gains and losses from currency exchange rate fluctuations on transactions or balances denominated in currencies other than the functional currency of our subsidiaries, as well as the realized and unrealized gains and losses on some of our derivative instruments. In evaluating our currency hedging programs and ability to qualify for hedge accounting in light of our legal entity cash flows, we consider the benefits of hedge accounting relative to the additional economic cost of trade execution and administrative burden. Based on this analysis, we execute certain currency derivative contracts that do not qualify for hedge accounting.
The following table summarizes the components of other income, net:
In thousands
Three Months Ended September 30,
2026 2025
Gains on derivatives not designated as hedging instruments $ 6,554 $ 3,451
Currency-related losses, net (2,817) (181)
Other gains 2,212 183
Total other income, net $ 5,949 $ 3,453
The year-over-year changes in other income, net were primarily due to the currency exchange rate volatility impacting our derivatives that are not designated as hedging instruments, of which our Euro and GBP contracts are the most significant exposures that we economically hedge. For three months ended September 30, 2026, increases in gains on derivatives not designated as hedging instruments included $1.8 million of lower realized losses recognized during the current fiscal quarter. We expect volatility to continue in future periods, as we do not apply hedge accounting for most of our derivative currency contracts.
We experience currency-related net gains and losses due to currency exchange rate volatility on our non-functional currency intercompany relationships, which we may alter from time to time.
Interest expense, net
Interest expense, net primarily consists of interest on outstanding debt balances, amortization of debt issuance costs, debt discounts, interest related to finance lease obligations, accretion adjustments related to our
mandatorily redeemable noncontrolling interests, and realized gains (losses) on effective interest rate swap contracts and certain cross-currency swap contracts.
For the three months ended September 30, 2026, the year-over-year interest expense, net decreased $1.7 million primarily due to a lower weighted-average interest rate (net of interest rate swaps) on our senior secured term loan, partly from year over year reductions in our benchmark rate, term SOFR.
Income tax expense
In thousands Three Months Ended September 30,
2026 2025
Income tax expense $ 6,623 $ 17,838
Effective tax rate 117.6 % 73.2 %
For the three months ended September 30, 2026, income tax expense decreased compared to the prior year period primarily due to decreased income before income taxes and various immaterial discrete items in both periods.
We believe that our income tax reserves are adequately maintained by taking into consideration both the technical merits of our tax return positions and ongoing developments in our income tax audits. However, the final determination of our tax return positions, if audited, is uncertain, and therefore there is a possibility that final resolution of these matters could have a material impact on our results of operations or cash flows. Refer to Note 10 in our accompanying consolidated financial statements for additional details.
Reportable Segment Results
Our segment financial performance is measured based on segment EBITDA, which is defined as operating income plus depreciation and amortization; plus proceeds from insurance not already included in operating income; plus share-based compensation expense related to investment consideration; plus earn-out related charges; plus certain impairments and other adjustments; plus restructuring-related charges; less gain or loss on the purchase or sale of subsidiaries as well as the disposal of assets. The effects of currency exchange rate fluctuations impact segment EBITDA and we do not allocate to segment EBITDA any gains or losses that are realized by our currency hedging program.
VistaPrint
In thousands
Three Months Ended September 30,
2026 2025 2026 vs. 2025
Reported Revenue
$ 464,412 $ 454,909 2%
Segment EBITDA
80,658 89,986 (10)%
% of revenue 17 % 20 %
Segment Revenue
VistaPrint's reported and constant-currency revenue growth for the three months ended September 30, 2026 was 2%. For the three months ended September 30, 2026, VistaPrint growth was strongest in elevated products, including promotional products, apparel and gifts, marketing materials and packaging. Partially offsetting these areas of growth was an increase in backlog at the end of the quarter that was influenced by a U.S. customs software disruption and a 2% decline in certain legacy products that include business cards and stationery. Additionally, we amended the terms of our Wix partnership, requiring a change of the revenue recognition from a gross to net basis, which weighed on VistaPrint's revenue growth by 50 basis points, but has no impact on profit.
Segment Profitability
VistaPrint segment EBITDA decreased by $9.3 million for the three months ended September 30, 2026, driven primarily by a gross profit decline, which included $5.1 million of increased planned investment in our North American manufacturing operations, $3.0 million of higher Canadian duty and tariff costs, and $0.7 million in energy-related cost increases, net of pricing changes. Additionally, performance advertising spend increased by $8.0 million which was driven in part by testing into evolving marketing channels. These decreases were partially
offset by $4.2 million in lower operating expenses due in part to cost reduction actions taken over the past year. Foreign currency fluctuations negatively impacted segment EBITDA by $0.5 million year over year.
PrintBrothers
In thousands
Three Months Ended September 30,
2026 2025 2026 vs. 2025
Reported Revenue
$ 235,919 $ 184,711 28%
Segment EBITDA
24,317 25,739 (6)%
% of revenue 10 % 14 %
Segment Revenue
PrintBrothers' reported revenue growth for the three months ended September 30, 2026 was positively affected by tuck-in acquisitions by 25%, partially offset by negative currency exchange rate fluctuation of 2%, resulting in organic constant-currency revenue growth of 5%. Organic constant-currency revenue growth was driven primarily by order volume growth in our largest business within the segment.
Segment Profitability
PrintBrothers segment EBITDA decreased by $1.4 million for the three months ended September 30, 2026, driven by a $3.2 million increase in variable long-term incentive compensation expense due in part to an expense catch-up for a long-term incentive program based on a change in probability of achievement. Currency exchange rate fluctuations had a negative $0.4 million impact year over year. These items were partially offset by $2.7 million in EBITDA contributions from recent tuck-in acquisitions (net of transaction-related costs), and organic gross profit growth driven by the revenue growth described above.
The Print Group
In thousands
Three Months Ended September 30,
2026 2025 2026 vs. 2025
Reported Revenue
$ 109,274 $ 96,710 13%
Segment EBITDA
18,074 18,671 (3)%
% of revenue 17 % 19 %
Segment Revenue
The Print Group's reported revenue growth for the three months ended September 30, 2026 was positively affected by a tuck-in acquisition by 13%, partially offset by negative currency exchange rate fluctuation of 2%, resulting in constant-currency revenue growth of 2%. Organic constant-currency revenue growth was driven by increased fulfillment for other Cimpress businesses as we continue to optimize our manufacturing plant network and ramp volumes at our newer North American facility. External revenue remained relatively flat year over year, as we continue to experience a shift to lower overall order values in certain product categories, as well as continued declines in sales to reseller customers, offset by continued growth in sales to end customers.
Segment Profitability
The Print Group segment EBITDA decreased by $0.6 million for the three months ended September 30, 2026, driven by an organic gross profit decline, which included $0.5 million of energy-related input and shipping cost increases. Currency exchange rate fluctuations had a negative $0.3 million impact year over year. These items were partially offset by a $0.6 million EBITDA contribution from a recent acquisition, and increased cross-Cimpress fulfillment.
National Pen
In thousands Three Months Ended September 30,
2026 2025 2026 vs. 2025
Reported Revenue
$ 104,365 $ 103,209 1%
Segment EBITDA
5,372 (2,392) 325%
% of revenue 5 % (2) %
Segment Revenue
National Pen's reported revenue growth for the three months ended September 30, 2026 was negatively impacted by currency exchange rate fluctuation of 1%, resulting in constant-currency revenue growth of 2%, driven by an increase in fulfillment for other Cimpress businesses. External revenue was relatively flat year over year, as growth within the e-commerce channel was offset by the decline associated with a planned reduction in marketing spend.
Segment Profitability
National Pen's segment EBITDA increased $7.8 million for the three months ended September 30, 2026, and benefited from $7.3 million of U.S. tariff refunds. Currency exchange rate fluctuations had a negative $0.3 million impact year over year. Segment EBITDA growth was supported by lower advertising spend of $3.0 million, partially offset by a residual gross profit decline of $2.6 million, excluding tariff refunds, driven by increased energy-related input costs and tariff costs.
All Other Businesses
This segment includes BuildASign, Printi, and new channels that we are developing, including our strategic partnership with Canva.
In thousands
Three Months Ended September 30,
2026 2025 2026 vs. 2025
Reported Revenue
$ 72,492 $ 61,742 17%
Segment EBITDA
5,427 9,080 (40)%
% of revenue 7 % 15 %
Segment Revenue
All Other Businesses' reported and constant-currency revenue growth for the three months ended September 30, 2026 was 17%. BuildASign, the largest business in this segment, delivered strong growth from fulfillment for other Cimpress businesses, as well as growth across home decor, signage and packaging categories. In addition, our new strategic partnership with Canva drove incremental revenue growth this quarter.
Segment Profitability
For the three months ended September 30, 2026, segment EBITDA decreased $3.7 million, largely driven by higher variable long-term incentive compensation expense of $1.4 million due to the non-recurrence of a benefit in the prior-year period, and $0.7 million of net increased start-up costs from the expansion of our North American production network. Segment EBITDA was also impacted by $0.9 million of additional tariff costs on certain goods sold to U.S. customers, partially offset by a $0.2 million benefit from IEEPA tariff refunds related to costs previously incurred. Partially offsetting the segment EBITDA decline was EBITDA contributions from our new strategic partnership with Canva.
Central and Corporate Costs
Central and corporate costs primarily consist of the team of software engineers that is building our mass customization platform; shared service organizations such as global procurement; technology services such as security; administrative costs of our Cimpress India offices where numerous Cimpress businesses have dedicated business-specific team members; and our corporate functions, including tax, treasury, internal audit, legal,
sustainability, real estate, corporate communications, consolidated reporting and compliance, investor relations, and the functions of our CEO and CFO. These costs also include certain unallocated share-based compensation costs.
During the three months ended September 30, 2026, year-over-year central and corporate costs decreased by $1.0 million, primarily due to a decrease in third-party technology costs of $2.3 million that was influenced by efficiency gains in our platform infrastructure, partially offset by higher unallocated share-based compensation expense of $0.8 million, driven by fluctuations in the attainment levels year over year associated with the performance conditions of our performance share units.
Liquidity and Capital Resources
Consolidated Statements of Cash Flows Data
In thousands
Three Months Ended September 30,
2026 2025
Net cash provided by operating activities $ 28,929 $ 25,059
Net cash used in investing activities (169,119) (42,818)
Net cash provided by (used in) financing activities 14,194 (14,656)
The cash flows during the three months ended September 30, 2026 related primarily to the following items:
Cash inflows:
•Adjustments for non-cash items of $53.6 million primarily related to adjustments for depreciation and amortization of $44.3 million, and share-based compensation costs of $16.1 million, offset in part by deferred taxes of $3.7 million and unrealized currency-related gains of $2.8 million.
•Net proceeds from borrowings of debt of $31.3 million, including borrowings on the revolving credit facility, offset by our term loan amortization payments. Refer to Note 9 in the accompanying consolidated financial statements for additional details.
•Proceeds from the sale of assets of $1.1 million, primarily related to the sale and replacement of smaller production equipment assets across several businesses.
•Proceeds from the settlement of derivatives designated as hedging instruments of $0.6 million.
•Proceeds from the exercise of options of $0.2 million.
Cash outflows:
•Business acquisitions, net of cash acquired of $131.6 million, which related to a tuck-in acquisition that is included in our PrintBrothers reportable segment. Refer to Note 6 in the accompanying consolidated financial statements for additional details.
•Net working capital outflows of $23.7 million, primarily due to increases in inventory levels in preparation for our peak season in the second quarter, as well as higher receivables driven by typical volume increases in September, offset in part by a net increase in current liabilities due to timing.
•Capital expenditures of $22.8 million, of which the majority is related to the purchase of manufacturing and automation equipment and expansion of our North American production network.
•Internal and external costs of $16.4 million for software and website development that we have capitalized.
•Payment of withholding taxes in connection with share awards of $13.8 million, primarily driven by the vesting of restricted and performance share units.
•Payments for finance lease arrangements of $3.1 million.
•Net loss of $1.0 million.
•Purchase of noncontrolling interests of $0.4 million. Refer to Note 11 in the accompanying consolidated financial statements for additional details.
Additional Liquidity and Capital Resources Information. At September 30, 2026, we had $120.1 million of cash and cash equivalents and $1,667.6 million of debt, excluding debt issuance costs and debt premiums and discounts. During the three months ended September 30, 2026, we financed our operations and strategic investments through internally generated cash flows from operations, cash on hand, and borrowings on our Revolving Credit Facility. We expect to finance our future operations through our cash, operating cash flow, and borrowings under our debt arrangements.
We have historically used excess cash and cash equivalents for organic investments, share repurchases, acquisitions and equity investments, and debt reduction. During the three months ended September 30, 2026, we did not purchase or retire any of our ordinary shares. We evaluate share repurchases, as any other use of capital, relative to our view of the impact on our intrinsic value per share compared against other opportunities.
Supply Chain Financing Program. As part of our ongoing efforts to manage our liquidity, we work with our suppliers to optimize our terms and conditions, which includes the extension of payment terms. We facilitate a voluntary supply chain finance program through a financial intermediary to allow our suppliers to receive funds earlier than our contractual payment date. We do not believe there is a substantial risk that our payment terms will be shortened in the near future. Refer to Note 13 of the accompanying consolidated financial statements for additional information.
Indefinitely Reinvested Earnings. As of September 30, 2026, a portion of our cash and cash equivalents were held by our subsidiaries. We do not intend to repatriate the funds held by certain subsidiaries as the cash and cash equivalent balances are generally used and available, without legal restrictions, to fund ordinary business operations and investments of the respective subsidiaries. If there is a change in the future, the repatriation of undistributed earnings from certain subsidiaries, in the form of dividends or otherwise, could have tax consequences that could result in material cash outflows.
Contractual Obligations
Contractual obligations at September 30, 2026 are as follows:
In thousands Payments Due by Period
Total Less
than 1
year 		1-3
years 		3-5
years 		More
than 5
years
Operating leases, net of subleases (1) $ 157,858 $ 23,951 $ 51,909 $ 31,099 $ 50,899
Purchase commitments 310,257 87,496 116,296 103,229 3,236
Senior secured credit facility and interest payments (2) 1,578,860 111,188 158,756 158,510 1,150,406
2032 Notes and interest payments 757,314 38,719 77,438 77,438 563,719
Other debt 13,131 7,311 1,587 1,062 3,171
Finance leases, net of subleases (1) 60,776 10,222 22,055 15,246 13,253
Total (3) $ 2,878,196 $ 278,887 $ 428,041 $ 386,584 $ 1,784,684
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(1) Operating and finance lease payments above include only amounts which are fixed under lease agreements. Our leases may also incur variable expenses which are not reflected in the contractual obligations above.
(2) Interest payments are based on the interest rate as of September 30, 2026 and assume all Term SOFR-based revolving loan amounts outstanding will not be paid until maturity but that the term loan amortization payments will be made according to our defined schedule. Senior secured credit facility and interest payments include the effects of interest rate swaps, whether they are expected to be payments or receipts of cash.
(3) We may be required to make cash outlays related to our uncertain tax positions. However, due to the uncertainty of the timing of future cash flows associated with our uncertain tax positions, we are unable to make reasonably reliable estimates of the period of cash settlement, if any, with the respective taxing authorities. Accordingly, uncertain tax positions of $1.7 million as of September 30, 2026 have been excluded from the contractual obligations table above. See Note 10 in our accompanying consolidated financial statements for additional information on uncertain tax positions.
Operating Leases. We rent manufacturing facilities and office space under operating leases expiring on various dates through 2046. The terms of certain lease agreements require security deposits in the form of bank guarantees and letters of credit, with $4.5 million in the aggregate outstanding as of September 30, 2026.
Purchase Commitments. At September 30, 2026, we had unrecorded commitments under contract of $310.3 million. Purchase commitments consisted of third-party cloud services of $192.6 million; third-party fulfillment and digital services of $70.1 million; software of $30.8 million; professional and consulting fees of $11.4 million; production and computer equipment purchases of $1.7 million; advertising of $1.1 million; and other commitments of $2.4 million.
Senior Secured Credit Facility and Interest Payments. As of September 30, 2026, we had $35.0 million in outstanding borrowings under our $250.0 million senior secured revolving credit facility. After accounting for outstanding borrowings and letters of credit, available borrowing capacity under the credit facility was $197.7 million. Our unused balance can be drawn at any time so long as we are in compliance with our debt covenants, and if the aggregate principal amount of outstanding revolving loans, swingline loans and unreimbursed letter of credit disbursements made under the Revolving Credit Facility exceeds 20% of the aggregate revolving commitments as
of the last day of any fiscal quarter, then we are subject to a financial maintenance covenant requiring that the Consolidated Leverage Ratio calculated as of the last day of such quarter may not exceed 4.50 to 1.00. Any amounts drawn under the Revolving Credit Facility will be due on June 4, 2031. Interest payable included in the above table is based on the interest rate as of September 30, 2026 and assumes all Term SOFR-based revolving loan amounts outstanding will not be paid until maturity but that the term loan amortization payments will be made according to our defined schedule. As of September 30, 2026, we have borrowings under our Restated Credit Agreement of $1,129.5 million, consisting of the revolving credit facility of $35.0 million and the term loan of $1,094.5 million. The term loan amortizes over the loan period, with a scheduled maturity date of June 4, 2033.
2032 Senior Notes and Interest Payments. Our $525.0 million 2032 Notes bear interest at a rate of 7.375% per annum and mature on September 15, 2032. Interest on the 2032 Notes is payable semi-annually on March 15 and September 15 of each year. Refer to Note 9 in the accompanying consolidated financial statements for additional information.
Debt Covenants. The Restated Credit Agreement and the indenture that governs our 2032 Notes contain covenants that restrict or limit certain activities and transactions by Cimpress and our subsidiaries. As of September 30, 2026, we were in compliance with all covenants under our Restated Credit Agreement and the indenture governing our 2032 Notes. Refer to Note 9 in the accompanying consolidated financial statements for additional information.
Other Debt. In addition, we have other debt which consists primarily of term loans acquired through our various acquisitions or used to fund certain capital investments. As of September 30, 2026, we had $13.1 million outstanding for those obligations that have repayments due on various dates through September 2037.
Finance Leases. We lease certain facilities, machinery, and plant equipment under finance lease agreements that expire at various dates through 2037. The aggregate carrying value of the leased assets under finance leases included in property, plant and equipment, net in our consolidated balance sheet at September 30, 2026 is $49.3 million, net of accumulated depreciation of $28.7 million. The present value of lease installments not yet due included in other current liabilities and other liabilities in our consolidated balance sheet at September 30, 2026 amounts to $56.0 million.
Additional Non-GAAP Financial Measures
Constant-currency revenue growth and constant-currency revenue growth excluding acquisitions/divestitures (which we refer to above as organic constant-currency revenue growth), in each case as defined and presented in the consolidated results of operations section above (with reconciliations to GAAP revenue growth), as well as adjusted EBITDA and adjusted free cash flow presented below, are supplemental measures of our performance that are not required by, or presented in accordance with, GAAP. We do not, nor do we suggest that investors should, consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.
Adjusted EBITDA is defined as net income plus income tax expense plus (gain) loss on early extinguishment of debt plus interest expense, net plus other expense (income), net plus depreciation and amortization plus share-based compensation expense plus earn-out related charges plus certain impairments plus restructuring-related charges less the gain or loss on purchase or sale of subsidiaries as well as the disposal of assets. In addition, adjusted EBITDA includes the impact of certain items that are recognized in other income, net which includes realized gains or losses on currency derivatives that are intended to hedge our adjusted EBITDA exposure to foreign currencies for which we do not apply hedge accounting, as well as proceeds from insurance recoveries.
Adjusted EBITDA is the primary profitability metric by which we measure our consolidated financial performance and is provided to enhance investors' understanding of our current operating results from the underlying and ongoing business for the same reasons it is used by management. For example, for acquisitions, we believe excluding the costs related to the purchase of a business (such as amortization of acquired intangible assets, contingent consideration, or impairment of goodwill) provides further insight into the performance of the underlying acquired business in addition to that provided by our GAAP net income.
Adjusted free cash flow is the primary financial metric by which we set quarterly and annual budgets both for individual businesses and Cimpress-wide. Adjusted free cash flow is defined as net cash provided by (used in) operating activities less purchases of property, plant and equipment, purchases of intangible assets not related to acquisitions, and capitalization of software and website development costs that are included in net cash used in investing activities; plus the proceeds from sale of assets, payment of contingent consideration in excess of acquisition-date fair value, and gains on proceeds from insurance that are not included in net cash provided by
operating activities, if any. We use this cash flow metric because we believe that this methodology can provide useful supplemental information to help investors better understand our ability to generate cash flow after considering certain investments required to maintain or grow our business, as well as eliminate the impact of certain cash flow items presented as operating cash flows that we do not believe reflect the cash flow generated by the underlying business.
Our adjusted free cash flow measure has limitations as it may omit certain components of the overall cash flow statement and does not represent the residual cash flow available for discretionary expenditures. For example, adjusted free cash flow does not incorporate our cash payments to reduce the principal portion of our debt or cash payments for business acquisitions. Additionally, the mix of property, plant and equipment purchases that we choose to finance may change over time. We believe it is important to view our adjusted free cash flow measure only as a complement to our entire consolidated statement of cash flows.
The table below sets forth net (loss) income and adjusted EBITDA for the three months ended September 30, 2026 and 2025:
In thousands Three Months Ended September 30,
2026 2025
Net (loss) income $ (991) $ 6,520
Exclude expense (benefit) impact of:
Income tax expense 6,623 17,838
Interest expense, net
26,337 28,066
Other income, net (5,949) (3,453)
Depreciation and amortization 44,280 36,618
Share-based compensation expense (1) 15,911 14,793
Certain impairments and other adjustments 252 727
Restructuring-related charges 3,994 298
Include certain items that are a part of Other income, net:
Proceeds from insurance 210 -
Realized losses on currency derivatives (2) (847) (2,692)
Adjusted EBITDA $ 89,820 $ 98,715
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(1) Share-based compensation expense excludes the portion included in restructuring-related charges to avoid double counting.
(2) Realized losses include only the impacts of certain currency derivative contracts that are intended to hedge our adjusted EBITDA exposure to foreign currencies for which we do not apply hedge accounting. Refer to Note 4 in our accompanying consolidated financial statements for further information.
The table below sets forth net cash provided by operating activities and adjusted free cash flow for the three months ended September 30, 2026 and 2025:
In thousands Three Months Ended September 30,
2026 2025
Net cash provided by operating activities $ 28,929 $ 25,059
Purchases of property, plant and equipment (22,803) (26,353)
Capitalization of software and website development costs (16,429) (17,286)
Proceeds from the sale of assets
1,053 821
Adjusted free cash flow
$ (9,250) $ (17,759)
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