10-Q · April 29, 2026
Quad/Graphics, Inc. reported Q1 2026 results with total revenue of $581 million and EPS of $0.25, surpassing consensus estimates. Despite a year-over-year sales decline of 7.7%, the company reaffirmed its full-year…
Earnings analysis · 10-Q
QUAD earnings analysis
Filed July 29, 2026 · Our reading of the company's report
The latest report
Quad delivered Q2 revenue of $577.5 million, up 1.0% year over year, and GAAP EPS of $0.07 versus $0.00 a year ago; operating margin improved to 2.6%. The improvement was supported by paper sales, logistics growth,…
Read full summary
Quad delivered Q2 revenue of $577.5 million, up 1.0% year over year, and GAAP EPS of $0.07 versus $0.00 a year ago; operating margin improved to 2.6%. The improvement was supported by paper sales, logistics growth, lower interest expense and lower depreciation, but underlying print volumes declined by $11.9 million and EBITDA margin fell to 5.6% from 6.0%. Liquidity remains adequate at $275.9 million, though first-half free cash flow was negative $66.2 million and net-debt leverage increased to 2.03x, slightly above the company's 2.00x target ceiling.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $0.07
What stood out
-
Revenue returned to year-over-year growth
Q2 net sales rose $5.6 million, or 1.0% year over year, to $577.5 million, driven by a $12.5 million increase in paper sales and $6.1 million growth in logistics, partly offset by an $11.9 million decline in print-product volumes. Revenue was modestly lower sequentially than Q1 2026's $581 million.
-
GAAP earnings turned positive year over year
GAAP diluted EPS improved to $0.07 from $0.00 in Q2 2025, while net earnings increased to $3.7 million from a $0.1 million loss. EPS was below Q1 2026's $0.13, reflecting normal quarterly variability despite the year-over-year improvement.
-
Operating margin improved year over year
Operating income increased $1.2 million, or 8.8%, to $14.9 million and operating margin expanded 20 basis points to 2.6% from 2.4% a year ago. Margin nevertheless declined from 3.1% in Q1 2026 and gross margin was approximately 21.0%, versus 21.7% in Q2 2025.
-
Core U.S. segment profitability strengthened
The core U.S. Print and Related Services segment lifted operating income $3.9 million, or 17.1%, to $26.7 million; its operating margin expanded to 5.1% from 4.3%. Segment sales were essentially flat at $526.0 million versus $524.5 million.
-
Lower financing and depreciation costs aided EPS
Interest expense fell $4.3 million to $8.9 million in Q2 because of lower average debt and a lower weighted-average borrowing rate. Depreciation and amortization also declined $3.5 million, or 16.9%, to $17.2 million.
-
Liquidity and covenant headroom remain adequate
Liquidity totaled $275.9 million at June 30, including $268.5 million of unused revolver capacity and $7.4 million of cash. The company reported compliance with its covenants, with a 2.00x Total Leverage Ratio versus a 3.50x maximum.
What to watch
-
Free cash flow remained deeply negative
First-half free cash flow was negative $66.2 million, slightly worse than negative $65.9 million a year earlier, as operating cash outflow was $40.9 million and capital expenditures were $25.3 million. Capex equaled about 2.2% of first-half sales of $1.159 billion.
-
Cash declined and leverage moved above target
Cash and cash equivalents fell $55.9 million from $63.3 million at December 31, 2025 to $7.4 million, while total debt and finance leases increased $30.3 million to $401.5 million. Net debt leverage rose to 2.03x from 1.57x and exceeded management's 1.50x-2.00x target range.
-
International margin and restructuring remain pressured
International Q2 operating income fell $2.0 million, or 51.3%, to $1.9 million and margin contracted to 3.7% from 8.2%, as restructuring-related charges increased $3.1 million to $3.3 million. Consolidated restructuring, impairment and transaction-related charges were $9.7 million in Q2 and management expects additional costs in future periods.
-
No material risk-factor updates; print risks persist
Item 1A states there were no material changes to the risk factors in the February 18, 2026 Form 10-K. Ongoing disclosed exposures include an $11.9 million Q2 reduction in print-product sales from lower volumes and the USPS's 8% temporary Ground Advantage/Priority Mail increase effective April 26, 2026 through January 17, 2027.
Management's outlook
The 10-Q MD&A does not provide explicit quantitative full-year revenue or EPS guidance. Management states that it expects industry challenges, including elevated interest rates, postal-rate increases, tariffs and paper availability pressures, to continue through 2026.
Earlier filings 4
10-K · February 18, 2026
Quad continued its strategic shift from commercial printing to a marketing experience (MX) company in 2025 while navigating macro pressures (postage, paper, elevated rates). Revenue declined year-over-year from $2,672…
10-Q · October 29, 2025
Quad/Graphics reported Q3 net sales of $588.0 million, down from $674.8 million a year ago, but delivered a return to operating profitability with operating income of $26.4 million and net earnings of $10.2 million.…
10-Q · July 30, 2025
Quad reported Q2 net sales of $571.9 million (down from $634.2M a year ago) and generated operating income of $13.7 million. The quarter produced a small net loss of $0.1 million (diluted EPS $0.00) versus a net loss of…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.