Deluxe Corporation Reports Q2 2025 Results: Revenue Decline but Increased Net Income and Adjusted EBITDA

Deluxe Corporation reported its financial results for the second quarter and first half of 2025, revealing a decline in total revenue but an increase in net income and adjusted EBITDA. For the quarter ended June 30, 2025, the company generated total revenue of $521.3 million, a decrease of 3.1% from $537.8 million in the same period last year. The decline was attributed to business exits that accounted for a $3 million reduction in revenue, alongside soft demand for promotional products and a continuing decline in order volumes for checks and business forms. However, net income rose to $22.4 million, up from $20.5 million a year earlier, reflecting effective pricing and cost management strategies.

In the first half of 2025, Deluxe's total revenue decreased by 1.4% to $1.06 billion, compared to $1.07 billion in the prior year. The company noted that the revenue drop was partially offset by growth in its data-driven marketing and merchant services segments. Adjusted EBITDA for the first half increased to $207 million, up from $204 million, driven by improved pricing and cost management actions. The adjusted EBITDA margin also improved to 19.5%, compared to 19.0% in the same period last year.

Deluxe's operational metrics showed a positive trend, with free cash flow increasing significantly to $52.1 million in the first half of 2025, compared to $17.6 million in the same period of 2024. The company attributed this increase to effective cost management, a reduction in performance-based employee bonuses, and lower restructuring expenses. Additionally, the company reported a reduction in net debt by $24 million from the previous year-end, reflecting its commitment to improving financial health.

Strategically, Deluxe announced the acquisition of certain assets from JPMorgan Chase Bank’s CheckMatch electronic check conveyance service business for $25 million, which is expected to enhance its B2B Payments segment. The company continues to focus on its North Star program, aimed at driving earnings growth, increasing cash flow, and reducing debt. The program has already led to a reduction in selling, general, and administrative expenses by 8.3% in the second quarter of 2025 compared to the previous year.

Looking ahead, Deluxe remains cautious about market conditions, particularly regarding inflation and consumer spending trends, which could impact its business segments. The company holds $26 million in cash and cash equivalents, with an additional $390 million available under its revolving credit facility, positioning it to meet operational needs and capital expenditures in the coming year.