Donnelley Financial Solutions reported higher sales, earnings and cash generation in the third quarter, with growth in software solutions and capital-markets activity helping lift results. The company also repurchased shares and ended September with low leverage.
Software accounted for just over half of revenue. Management said its ActiveDisclosure platform continued to gain traction, while capital-markets deal activity was stronger than a year earlier but had cooled from the first half of 2026.
Key details
- Revenue increased 5.5% to $185.0 million from $175.3 million a year earlier. DFIN attributed the growth primarily to software solutions and higher capital-markets transaction volumes.
- Software solutions revenue rose 5.0% to $95.2 million, representing 51.5% of total sales. ActiveDisclosure, part of the company’s compliance offerings, grew about 24%, supported by greater client adoption and the migration of some traditional services onto the platform.
- GAAP net earnings were $21.3 million, or 85 cents per diluted share, compared with a net loss of $40.9 million, or $1.49 per share, in the year-earlier quarter. The comparison was affected by large charges in 2025: that quarter included $64.6 million in after-tax charges, primarily from a non-cash pension plan settlement and share-based compensation. The 2026 quarter included $5.5 million in after-tax charges, primarily for share-based compensation.
- Adjusted net earnings rose 13.1% to $26.8 million, or $1.07 per diluted share, from $23.7 million, or 86 cents per share.
- Adjusted EBITDA increased 9.9% to $54.4 million, while its margin expanded to 29.4% from 28.2%, an improvement of about 120 basis points. Higher software and tech-enabled services sales, along with cost-control efforts, supported the increase; higher incentive compensation and selling expenses partly offset it.
- Cash generation strengthened. Operating cash flow was $98.2 million, up 32.0%, and free cash flow was $85.8 million, up 44.9%. DFIN cited improved profitability and disciplined working-capital management.
- Capital-markets activity was mixed. Transaction revenue was higher than in the third quarter of 2025 as overall market activity improved year over year. But deal volume moderated from the first half of 2026, particularly the number of priced IPOs.
- DFIN repurchased 146,672 shares for about $6.9 million, at an average price of $46.98. At quarter-end, $118.5 million remained under its $150 million repurchase authorization.
- Leverage remained low at 0.5 times gross leverage and 0.4 times net leverage as of September 30.
The results show growth in both revenue and adjusted profitability, alongside stronger cash flow. Software made up roughly half of sales, while the marked improvement in GAAP earnings also reflects the unusually large pension-related and other charges recorded in the year-earlier quarter.