Gentlemen, thank you for standing by, and welcome to the Deluxe quarterly earnings conference call. All participants are currently in a listen-only mode, and today's call is being recorded. At this time, I'd like to turn the conference over to your host, Vice President of Strategy and Investor Relations, Brian Anderson. Please go ahead.
Thank you, operator, and welcome to the Deluxe Third Quarter 2026 Earnings Call. Joining me on today's call are Barry McCarthy, our President and Chief Executive Officer, and Chip Zint, our Chief Financial Officer. At the end of today's prepared remarks, we will take questions. Before we begin, and as seen on the current slide, I'd like to remind everyone that comments made today regarding management's intentions, projections, financial estimates, and expectations about the company's future strategy or performance are forward-looking in nature as defined in the Private Securities Litigation Reform Act of 1995. Additional information about factors that may cause actual results to differ from projections is set forth in the press release we furnished today, in our Form 10-K for the year ended December 31, 2025, and in other company SEC filings.
On the call today, we will discuss non-GAAP financial measures, including comparable adjusted revenue, adjusted and comparable adjusted EBITDA and EBITDA margin, adjusted and comparable adjusted EPS, and free cash flow. In our press release, today's presentation, and our filings with the SEC, you will find additional disclosures regarding these non-GAAP measures, including reconciliations to the most comparable measures under U.S. GAAP. Within the materials, we are also providing reconciliations of GAAP EPS to adjusted EPS, which may assist with your modeling. As a reminder, all comparable adjusted metrics reflect the removal of impacts from business exits, including prior year adjustments to reflect removal of the Safeguard business, effective with the closing of that divestiture as of March 1, 2026. Financial metrics discussed also exclude any pro forma figures or historical financial results relating to the Celero acquisition for periods prior to the transaction closing on July 31, 2026.
Our pro forma reporting of these results in line with SEC requirements was filed separately last month and is available via EDGAR for further review. With that, I'll hand it over to Barry.
Thanks, Brian, and good evening, everyone. I am pleased to report our continued strong performance across the enterprise through the third quarter. During the period, we delivered robust growth across key metrics aligned to each of the three strategic planks of our core value creation algorithm: mix shift, operating leverage, and cash flow improvement to strengthen our balance sheet. First, our overall revenue expanded by 2.5% during the third quarter as we continued to shift our business mix toward the growing payments and Data Solutions segments. We meaningfully accelerated this mix shift via the Celero acquisition that closed July 31st. The acquisition expanded both our scale and overall growth rates for the third quarter Merchant Services segment results. We are also very pleased with our integration progress. We are realizing benefits from this combination consistent with our expectations and overall business case, in some cases ahead of schedule.
Incremental impacts from the Celero acquisition will be reflected for a full quarter beginning with our Q4 and ongoing results. Second, operating leverage. We remain focused on our core execution principles and driving efficiencies, expanding our adjusted EBITDA margins to nearly 23% while growing comparable adjusted EBITDA dollars at rates above that of revenue. Third, cash flow expansion supporting balance sheet improvement. We continued to convert these expanded earnings into strong free cash flow, which grew by more than 40% year to date through the third quarter. This expanding cash generation further enhances our deleveraging ability as we progress through the balance of the year, consistent with our ongoing clear capital allocation priorities.
Importantly, following from our strong third quarter performance across each of our key value creation metrics, together with the progress we have made on the Celero integration, we are raising our full year guidance this evening across core revenue and adjusted EBITDA metrics. We are also affirming and narrowing our ranges for the balance of our outlook measures. Chip will provide additional detail during his comments. Next, I would like to briefly detail additional highlights from the quarter across each business unit. Let us start with a bit more perspective on our mix shift progress. After reaching a Q1 milestone with just over 50% of our revenue from non-print sources for the first time in our more than 100-year history, we saw our payments and Data Solutions businesses together reach 57% of overall revenue during Q3.
Although the third quarter included only two months of Celero-related revenues, the balance of overall payments and Data Solutions mix reached the 57 to 43 ratio that we had signaled on a pro forma basis when we announced the acquisition. This is a clear signal of the ongoing acceleration of the business toward these growth areas, a trend we would expect to sustain as full quarter Celero-related revenues are reflected beginning in the fourth quarter. Total reported year-to-date revenues across combined payments and Data Solutions segments have expanded year- over- year by more than 14%. Adjusting out any acquisition impacts from Q3 results, our revenue for the payments and Data Solutions businesses together grew by 8.3%, further signaling the underlying strength of our core offerings in each of these spaces.
Our third quarter and year-to-date revenue results were inclusive of another strong growth quarter for the Data Solutions segment, which expanded revenues by more than 15% for an eighth consecutive quarter. Third quarter Data Solutions segment revenues expanded year-over-year by 15.4%, continuing to reflect the demonstrated strength of our AI-supported data analytics and marketing offerings, and continued demand from customers across verticals. We remain particularly pleased with the trajectory of this business, which achieved its first $100 million reported revenue quarter during Q3. Our teams continue to deliver proven data-driven marketing solutions, targeting conversion of high lifetime value prospects across our core FI client base, as well as expanding adjacent market spaces. During the quarter, our Payments businesses together also saw strong continued revenue growth rates in line with our guidance outlook across both the base Deluxe Merchant Services and B2B Payments segments.
Beyond our expanded top line trajectory, highlights for the quarter included our continued ability to drive expansion of our overall adjusted EBITDA margins, as I noted previously. Our Payment segments led the way towards this margin expansion through the third quarter. Continued focus toward driving cost efficiency and our increased scale across the businesses resulted in year-to-date margin expansion across both the B2B Payments and Merchant Services segments, reflecting 440 basis points and 270 basis points of growth respectively. For Print, improving year-to-year product mix within the segment and delivering ongoing operational efficiencies resulted in 250 basis points of year-to-date adjusted EBITDA expansion as well. These overall expanded profitability rates contributed toward our more than 40% year-to-date growth of free cash flow as well.
Finally, the Celero acquisition is not only adding revenue, but also contributing to overall Merchant Services margin growth across the segment, which expanded by 300 basis points for the quarter, consistent with our forecasts. We are pleased with our overall integration progress so far and remain highly confident toward realization of our $15 million threshold level cost synergy commitment over the 24-month horizon from the transaction closing. We look forward to sharing more about the strength of our integrated Merchant Services offerings and our improved growth outlook from the combination at our December Investor Day. Before turning over to Chip, I want to quickly reinforce the strong overall Q3 performance and our year-to-date progress on core strategic priorities. This progress is solidly aligned within the framework of our shareholder value creation algorithm, which we share each quarter. First, mix shift.
We accelerate our mix shift towards Payments and Data Solutions, achieving 57% of total company revenue, driving expanded overall revenue growth. This shift clearly positions the company for meaningfully improved growth prospects moving forward, aligned to robust secular growth trends across payments and data markets. Second, cash flow expansion toward balance sheet strengthening. We leveraged revenue growth and operating discipline to continue our robust expansion of year-to-date free cash flows, enabling our ongoing capital allocation commitment to overall debt reduction over our planning horizon. Third, operating leverage. We drove operating leverage and overall efficiency across the business, expanding our adjusted EBITDA margins by 90 basis points versus the prior year period. We also maintained our commitment to return capital to shareholders via the dividend. Deluxe is well-positioned to drive consistent growth of revenue and profitability, with a significant majority of revenue now coming from Payments and Data Solutions.
We will continue to optimize our balance sheet over the near-term horizon. Our future is bright, and our confidence is reflected in our updated full-year guidance ranges. We look forward to sharing additional details regarding our promising multi-year growth prospects, our initial 2027 guidance ranges, and the outlook for each line of business during our December 2 Investor Day. Brian will provide some additional details about this upcoming event following our Q&A at the end of this call. Finally, before passing the baton to Chip, I would like to take a moment, as always, to thank my fellow Deluxers. As we progress toward the company's 112th year, our strong, enduring culture and clear commitment to meeting and exceeding our customers' needs while delivering value for shareholders truly reflects the Deluxe difference. Thank you to my fellow Deluxers for your continued dedication and focused efforts enabling our transformation.
With that, I will turn it over to Chip.
Thank you, Barry, and good evening, everyone. As Barry mentioned, we were very pleased with our strong third quarter results, reflecting improved top-line growth, continued expansion of our profit margins, and robust conversion of our adjusted EBITDA to free cash flow in support of our capital allocation priorities. These results once again reflected solid growth of our year-over-year revenue, comparable adjusted EBITDA and EPS, and were accompanied by strong execution across each of these metrics relative to our full-year guidance objectives. As I do each quarter, I will begin by reviewing some of the consolidated highlights for the period before moving on to the individual operating segment results, our strong cash generation, other balance sheet items, and finally, our updated full-year 2026 outlook ranges, which Barry referenced during his comments.
For the third quarter, we reported total revenue of $553.9 million, increasing 2.5% against prior year reported results, while expanding 9.1% after removing prior year revenues from our Print business exits on a comparable adjusted basis. We reported GAAP net income of $13 million, or $0.28 per share, down from $33.7 million, or $0.74 per share in the third quarter of 2025. This reduction was driven primarily as a result of $8.9 million of non-recurring restructuring and integration expenses and $9.8 million of transaction costs, as well as increased year-over-year interest expense included in the period, net of overall incremental operating profits generated from higher third quarter revenues. Adjusted EBITDA was $127.1 million, increasing 9.6% on a comparable adjusted basis versus the third quarter of last year.
Adjusted EBITDA margins were 22.9%, improving by 90 basis points overall and 10 basis points on a comparable adjusted basis. Q3 adjusted diluted EPS came in at $1.06, improving from $1.04 on a comparable adjusted basis, driven primarily by our improved adjusted operating results, net of increased year-over-year interest expense. Turning next to our operating segment details, beginning with the Merchant Services segment. Overall, Merchant Services revenues, including results from the Celero acquisition as of July 31 transaction closing, expanded during the third quarter by 37.9% year-over-year to $135.1 million. Removing Celero-related revenues, which will be detailed within our quarterly filings for the balance of this year, base Deluxe Merchant Services standalone revenues expanded by roughly 4%. This reflected continuation of the year-to-date mid-single-digit growth trajectory, consistent with our full-year guidance expectations for the standalone DMS outlook.
Segment adjusted EBITDA finished at $32.1 million, representing year-over-year expansion of 57.4%, including Celero impacts, while overall margins finished the quarter at 23.8%, expanding by 300 basis points versus prior year levels. These margin levels reflected expected accretion from the two-month Celero margin inclusion within the quarterly results, while remaining in line with our overall guidance for full-year margins trending towards a mid-20s profile in our prior outlook. We continue to expect the base DMS business to achieve overall mid-single-digit revenue growth consistent within our updated guidance ranges provided this evening. As full-quarter Celero results are integrated to the Merchant Services segment performance for the balance of year periods, we're expecting significant upside to the total reported Merchant Services segment revenue and adjusted EBITDA outlook.
We will provide further detail on these overall impacts as our integration efforts come into clearer view, and we provide initial 2027's guidance at our Investor Day next month. Turning to B2B Payments. For the third quarter, B2B Payments segment revenues reflected an accelerated growth trajectory, finishing at $77.3 million, representing an increase of 5.7% versus Q3 of 2025. The results reflected continued stability across our installed lockbox volumes in line with our expectations, in addition to some opportunistic wins across our broader suite of treasury management offerings during the quarter. While pleased with this increased level of B2B revenue growth for the specific period, we would forecast some moderation of these growth figures on a sequential basis in line with our overall low single-digit revenue growth outlook for this segment across the full-year period. Adjusted EBITDA for B2B finished at $22.5 million, reflecting an overall strong 29.1% margin.
This represented particularly robust expansion of adjusted EBITDA results, growing by 33.9% from the prior year, benefiting from the expanded revenue growth and particularly the noted opportunistic wins during the period. We expect overall segment margin results to also moderate sequentially in line with our full-year rate guidance expectations around the mid-20s for the segment. Moving to Data Solutions. This segment continued to overdeliver against our year-over-year revenue growth expectations in support of ongoing marketing campaign demand extending to the back half quarters. As Barry noted, revenues finished at $102.9 million, reaching nine figures for the quarter for the first time since segment reporting began, driving overall growth of 15.4% versus Q3 of 2025.
Third quarter adjusted EBITDA finished at $27.6 million, with the margin rate finishing at 26.8% for the period, benefiting modestly from the higher-than-expected revenue growth while remaining in line on a year-to-date basis at 24.3% through three quarters, with our longer-term low to mid-20s expectation for the segment. We have updated our overall full-year 2026 guidance expectations for the Data Solutions segment to now reflect expected low double-digit overall segment revenue growth. With this increase, we are now expecting Data Solutions revenues to sustain their double-digit year-over-year growth rates into the fourth quarter, while also noting normal sequential fourth-quarter moderation of segment revenues overall on typically lower FI marketing activity spanning the Q4 holiday periods.
We remain very pleased with the continuing strong year-over-year trajectory for the Data Solutions business, overperforming our initial guidance forecast as noted, and we look forward to providing additional color around the long-term trajectory for the Data Solutions business as part of our 2027 guidance at our upcoming Investor Day event. Turning finally to our Print businesses. Print segment third-quarter revenue finished at $238.6 million, declining by 3.6% year-over-year on a comparable adjusted basis, with both legacy check and remaining promotional solution lines of business stabilizing towards this overall blended comparable adjusted trajectory. Overall adjusted EBITDA for Print finished the period at $84.3 million. The resulting 35.3% margin rate continued to align to our full-year margin outlook for the segment as we continue to prioritize the mix of Print revenue away from lower-margin promo offerings towards our higher-margin in-source products.
Consistent with prior quarters, we continue to expect to see low to mid-single-digit comparable adjusted revenue declines across the Print segment, with full-year adjusted EBITDA margins remaining in the low to mid-30s within our updated full-year 2026 guidance ranges. Moving now to our balance sheet and cash flow. We ended the third quarter with a net debt level of $1.93 billion, an increase of $536.7 million from $1.39 billion at year-end 2025, reflective of our updated debt financing supporting the Celero acquisition, as we shared previously during both the announcement and the closing of the transaction.
Including our targeted cost synergy estimates and other impacts related to the Celero transaction, our Q3 net debt-to-adjusted EBITDA ratio would represent approximately 3.8 times leverage as of the end of the period, consistent with our forecast at the announcement of the deal and the starting point for our committed multi-year deleveraging path to a three times or lower ratio by the end of 2028. Free cash flow, defined as cash provided by operating activities less CapEx, finished at $134.9 million for the year-to-date period. This was an improvement of $39 million, or 40.7%, from the results reported through the first three quarters of 2025. This continuing expansion of cash flows was reflective of our improved year-to-date adjusted operating results, including lower overall year-to-date SG&A and restructuring-related expenses, net of transaction and integration costs for the Celero acquisition, and increased year-over-year CapEx investment.
Continuation of our strong conversion of adjusted EBITDA to cash flow remains a top priority for the enterprise as we reset our deleveraging expectations against the updated capital structure, inclusive of our acquisition financing activity. As we shared during the transaction announcement in June, we expect to return to 3x net leverage by the end of 2028. Our updated long-term capital structure across the balance sheet remains well-positioned from both liquidity and go-forward maturity position, with all material debt maturities extended over a 2029 or later horizon. This structure allows us to continue to assess market conditions relative to our 2029 bond maturities opportunistically, as warranted over coming periods. As a reminder, in conjunction with the funding of the Celero acquisition, we entered into interest rate swaps, fixing our interest costs across 75% of our overall borrowing mix.
This structure enables improved confidence to our planned cash flow generation and debt reduction trajectory, while insulating us from some of the volatility associated with an uncertain interest rate environment. Consistent with past quarters, our board approved a regular quarterly dividend of $0.30 per share on all outstanding shares. The dividend will be payable on December 1st, 2026, to all shareholders of record as of market closing on November 17th, 2026. As Barry noted, we are increasing our prior revenue and adjusted EBITDA guidance ranges to reflect our year-to-date results and updated outlook across the operating segments, inclusive of August through December expected Celero results, for which you will recall, we updated our ranges last quarter. We are also narrowing our guidance ranges for adjusted EPS, increasing the overall midpoint of that range, while affirming our strong free cash flow outlook from prior quarters.
Our updated full-year ranges are as follows: revenue of $2.13 billion-$2.15 billion. This reflects a roughly $30 million improvement to the prior range from strength across baseline Deluxe segments, now growing positive 1%-2%, excluding impacts from M&A activity, while maintaining our previous expectations for Celero. Adjusted EBITDA of $470 million-$480 million, increased to reflect between 9% and 11% growth versus prior year reported results. Adjusted EPS of $3.80-$4.00, narrowed upward to reflect between 5% and 11% growth. Free cash flow of approximately $200 million, continuing to reflect 14% growth versus our 2025 results.
Finally, to assist with your balance of year modeling, our guidance also assumes the following: interest expense of approximately $130 million, an adjusted tax rate of 26%, depreciation and amortization of approximately $170 million, of which acquisition amortization is approximately $70 million, an average outstanding share count of approximately 46.5 million shares, and capital expenditures of approximately $110 million. This guidance remains subject to, among other things, prevailing macroeconomic conditions, including interest rates, labor supply issues, inflation, and the impact of any incremental portfolio additions or exits. To summarize, we remain very pleased with our year-to-date results and momentum through the third quarter, particularly our sustained revenue growth, continuing operating leverage, strong free cash flow conversion, and comparable adjusted expansion of our earnings metrics in line with our expectations and updated outlook.
As we progress through the final quarter of the year, this strong execution focus and our capital allocation discipline provide a solid foundation for further expansion of our growth prospects, enhanced scale across Payments and Data Solutions, and achievement of our longer-term balance sheet improvement objectives in support of our long-term value creation algorithm. We look forward to sharing more details regarding our Celero integration progress and extended outlook at our Investor Day event next month. Operator, we are now ready to take questions.
Thank you. If you would like to signal with questions, please press star one on your touch-tone telephone. If you are joining us today using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, that is star one if you would like to signal with questions. The first question will come from Kartik Mehta with Northcoast Research.
Hey, good afternoon. Sorry about that. Hey, Barry, if we could just focus on the Merchant Services business a bit. I think you said that the organic growth of that business is 8% or excluding Celero. I am wondering, as you look forward, what do you think the organic growth of that business, of the Merchant Services business can be now that you have a couple assets, you are integrating them, and you have an opportunity to cross-sell and provide other products?
Sure. Kartik, first of all, great to hear your voice. We are really pleased with how the Payments and Data Solutions businesses together are growing at that 8% level. When we announced the acquisition of Celero, we believed that we would be able to, over time, accelerate the growth of those businesses from mid-single digits upwards. We will have a much more deep conversation about that at the Investor Day, when the leader of that business, Kevin Jones, will be able to provide a detailed analysis and forward view for what 2027 and beyond will look like. We are very optimistic that it is going to deliver what our expectations were, which was to accelerate growth over time, combined with great operating synergies. We even said in our opening comments that we feel great about the progress we have made, and in some cases, we are tracking a bit ahead.
Yeah, Kartik, this is Chip. Just to clarify, the combined Payments and Data Solutions growth was 8% with no impact from M&A. The standalone Merchant Services without Celero grew 4% roughly, solidly in line with that mid-single-digit level we've been talking about.
Yeah. Thanks, Chip. I misspoke. Sorry about that. No, that makes sense. I'm assuming with Celero, you'll be able to accelerate as you combine those businesses and get efficiencies. You'll be able to accelerate that 4% growth down the road.
That is the thesis, and it's exactly what we said when we made the acquisition, and really pleased with the progress and believe even more strongly today than we did when we made the announcement.
Chip, just on the B2B Payments business, obviously, the margins have come in probably ahead of expectations. That business is doing well. I'm wondering, as you look at that business, how much of that margin improvement do you think is structural? How much of it do you think is just favorable business mix? I'm just trying to get a sense of, is that business over the next couple years, what the real opportunity there is from a margin standpoint since it's performed so well in 2026?
Yeah. I appreciate the compliment there. We are very proud of what that business has done. If you look back the last few years, we called out that improving margins, improving efficiency in the way we operate that business was one of our key goals. If you actually recall, just about two years ago, that was a business that was profitable in about the high teens, around 19%, and we said there was an opportunity to move it up multiple hundreds of basis points over the horizon towards a mid-20s profile. If you look at what we have done throughout last year and the first half of this year, you have seen us steadily improve that margin rate on the back of operating efficiency, deploying AI in the operations, and obviously just being great executors of the business.
Specific to this quarter, we called out some opportunistic wins, and that was a function of some bank M&A in the market. We have said before that that happens from time to time when banks merge. It can be a net positive to us. Specific to this quarter, bank M&A facilitated a bit of a one-time higher margin deal that accelerated that mix, popped it up above our long-term level for a brief period of time. But we reiterated that we still continue to see this business normalizing around those mid-20s. I think over the multi-year horizon, you should think of that as a good place to be.
We will talk more about this trajectory at Investor Day, but we are proud of the progress we have made there, but continue to believe mid-20s is the right profile for the business, and that is the expectations we are pointing you towards for the fourth quarter.
Perfect. Thank you very much. Appreciate it.
The next question will come from Charlie Strauzer with CJS Securities.
Hi. Good evening.
Hi, Charlie.
Hey. Just a question, I think, to start with Chip. If you could, maybe just continue the margin expansion discussion here, and how, when you look at the other segments, what are kind of the drivers of margin expansion, kind of behind the scenes there? It seems that you've got more room to work on all of those segments, and is that kind of a good way to think about it?
I actually think if you step back and look at how we've been guiding each of the segments throughout the year, where we thought they'd be, they're all performing relatively in line with expectations. We talked about the Merchant Services segment being in the mid-20s with 200-300 basis points of margin expansion across the year. Obviously, on a year-to-date basis, that number is around 270. Isolated in quarter, it was 300. That's starting to show you some of that accretion factor from the Celero acquisition. Obviously, as we integrate the business, we unlock synergies, we continue to scale, we would expect Merchant Services to continue to be able to have room to expand margins, moving from the mid-20s and beyond, but we continue to like the mid-20s isolated for this period. I just talked about B2B Payments. Very similarly, we're targeting mid-20s.
We've made a lot of progress over the last few years. A bit of a pop, an anomaly this quarter, but we expect to normalize and be able to maintain that. The Data Solutions business, you'll recall from a year ago, we talked about these rebates that we would have to lap this year and how that would pull down the margin rate from last year to this year, but we would expect to be in the low to mid-20s level for Data Solutions, and you've seen us do that relatively consistently from the fourth quarter of last year through now. We're very, very close to our run rate year-to-date margin profile. Continue to feel like that's the sweet spot, staying around that low to mid-20s level. Then lastly, Print. Our goal is to hold Print in the mid-30s.
You've seen that here with roughly right around 35% margins for the quarter. Very nice for the year-to-date period. I think all four of the segments are operating really well relative to our guidance expectations. Of course, we're going to continue to operate each efficiently, deploy AI, and look for room to move on all of them, but we feel great about where they are, and they're each performing in line with our expectations as we came into the year, and obviously the way we're guiding you for this year on a full-year basis as well.
Great. Thank you on that. Barry, if you could, I know you only had Celero for a couple months now, but maybe share a little bit more color as to how the integration's progressing behind the scenes.
Really appreciate the question, Charlie. We are really proud of the progress, and as I said earlier, in some cases, ahead of our own expectations. We named Kevin Jones as the leader of the combined business. Kevin has been leading a very thoughtful and thorough analysis of the organization. He has seeded his leadership team and cascaded that through the rest of the organization, and did that on a very appropriate but fast-paced timeline. We had the very good fortune of having great teams on both sides. We call him KJ, identified who we thought would make the best team, and by picking players from both teams and putting them together into one unit.
The senior leadership team is roughly even between the Celero team and the original Deluxe team, and we really do believe we have a team that can deliver accelerated growth over time. The team has already met for offsite strategy. They have already been executing on the synergies and have booked a number of them that, of course, we will be seeing in the periods ahead. Very, very proud of how the team has come together, the pace at which they are attacking the opportunities, how they are building pipeline together, launching new product and more. You will be hearing more in coming weeks and months about that, and of course, we will spend a lot more time talking about it when we are together in New York for Investor Day.
Great. Thank you. One last one for me, if you do not mind. Looking at CapEx, remind us where the main targets there for the capital and the deployment of the capital.
Yeah. As part of our capital allocation discipline, we continue to invest in product opportunities that can unlock and grow organic growth. We are investing in our Merchant Services business. We are accelerating the investment there as part of the integration to bring the two platforms together, and obviously try to attack that higher growth, as Kartik was asking about. We continue to invest in our Data Solutions business, our B2B Payments business, all areas of the business that have growth opportunities, while continuing to also invest equally in opportunities to drive efficiency or take cost out of the business. We are balancing all of those things with a little bit more of a tilt towards growth-related investment. Obviously, that is a disclosure, that is a number that is fully in line with our ongoing free cash flow guide range of $200 million.
Great. Thank you very much.
The next question will come from Gary Prestopino with Barrington Research.
Good afternoon, everyone. Barry, to the extent you can say or talk about this prior to your Investor Day, what are the attributes of Kevin Jones that made him so successful with Celero? Then, he is going to have free rein to apply those attributes to build the business overall?
Absolutely. I am happy to tell you about KJ today, and I know he will spend a few minutes introducing himself and his background when we are all together for Investor Day. KJ has a great background. He started at Chase Paymentech, who is obviously one of the leaders in the merchant industry. He went on and was actually part of the management team at First American, which is the business that we acquired and is our foundation for our Merchant Services business. He went on from there to build two successful startups that had successful exits. So at his very core, he is not only a competent general manager, he absolutely has a commercial bent and a focus on sales and revenue growth that is going to be a particularly important set of skills as he grows the business here.
He is also, I think, a great people leader, and we have seen that already as he has put together a great team and brought them together as one team already, delivering on the goals and expectation and many of the presumptions and plans that were part of the original business case for the acquisition. I will stop there and let him save some room for him to tell you more about himself when you see him in December. But really confident about him in this role and what he is going to be able to do to help us succeed.
Okay. Thank you.
The next question will come from Marc Riddick with Sidoti & Company.
Hey. Good evening, everyone.
Hey, Marc.
I was going to ask a question about Kevin, but I guess I won't now because I think you did a pretty good job of that. I really appreciate that. But maybe we could talk a little bit on the margin side of things. Certainly margins continuing to improve year-over-year in most of the segments, and maybe as well as corporate being down a bit. Maybe you could talk a little bit on the print side of margin. I was wondering how much room there was there as far as continuing to prioritize, trying to sort of eliminating or shooing some of the lower margin projects out there, how much room you might have.
It seems as though you're at a pretty good level there on the print side, but maybe you could talk a little bit about what room and what leverage you continue to have there. As well as, is there anything that remains in this space that may or may not be a strategic fit going forward and the like? I don't know if I'm getting into an area that steals some thunder from next month, which I don't want to do, but maybe you could talk a little bit about that.
Yeah. Thanks, Marc. We got it. First of all, I'm just going to reiterate how much we like the four segments we have. Just to reiterate the strategy that we deploy with those four segments, we leverage the cash flow, the distribution, the brand equity, and the relationships from our Print business, our legacy cash flowing check and print business, to invest and grow the Payments and Data Solutions business. We like that strategy because it's very clear, it's very evident in what you've seen here. It naturally unlocks this organic mix shift that's occurring, and that mix shift is a leading indicator to revenue growth, which is ultimately what we're all playing for here, right? As we rotate the portfolio over, that allows us to sustain and grow faster.
As we do that, we have built-in operating leverage where, as you noted, margins can expand. We can grow margin faster than revenue, and that all leads to improved profitability, improved EBITDA, growth of free cash flow, improved free cash flow conversion. It all leads to the debt paydown and the ability to pay down the debt and rotate more of that value to the equity of the company. That is the stated strategy. That is what is working. If you take all the pieces you laid out there, all of those things are how we have set this company up to go forward, right? The investments we have made around AI or efficiency are going to help us continue to expand margins. We are going to continue to look for opportunities to expand the margin rate.
I think the Print segment is a great example of an area we are doing that and can directly answer your question. We have been saying for a while that we are going to prioritize the higher-margin in-source products that we have and focus lesser on low margin or chasing top line just for the sake of getting revenue and to hurt the margin rate. You have seen us do that very well. The divestiture we did earlier in the year helped support that. That is one of the reasons why you have seen the overall Print margins expand this year, because deploying that strategy both within what we still have and exiting what we did earlier this year, it leads directly into that strategy. So, when you pull it all together, we like the four segments. We will continue to be opportunistic.
There is not a lot left in the portfolio anymore to really focus on, but if there is, it is going to have to fit and check all three boxes and strategically align to the goals we are doing. If the right opportunity comes along for something that is less, of course, we would explore that. But we feel good about the progress of what we are doing right now, and we think we have a great forward-looking strategy story to tell everybody in December at Investor Day.
Great. Last one for me, maybe to talk a little bit about what you are seeing from a demand perspective and maybe client industry vertical differentiation, or if there have been any shifts or changes that you have seen over the last 3-6 months that are worth calling out. Thank you.
So, Marc, I think we've seen a continuation of the economic trends that have been apparent for some period of time, and we don't see any significant change there. Consumer under some stress is not news, and we don't see a shift in demand. So maybe we're in some period of a new normal, perhaps, but there really is no new news there that is driving changes in aggregate demand. No change in really in the trajectory of what we've seen over previous periods.
Excellent. Looking forward to next month. Thank you.
And that does conclude the question-and-answer session. I'll now turn the conference back over to Brian Anderson.
Thanks, Justin. Before we conclude, as both Barry and Chip noted during their comments, Deluxe will be hosting a live Investor Day event on Wednesday, December 2nd, at the Four Seasons Hotel New York, beginning at 9:00 A.M. Eastern Time. Those interested in attending can RSVP or inquire further via the Deluxe Investor Relations inbox, as listed on the current slide. This event will also be available virtually via live webcast, for which additional registration information and links will be posted to the Deluxe Investor Relations website over the coming weeks. Thank you again for joining us today, and we look forward to seeing many of you in New York and speaking with you all again as we share our fourth quarter and full year 2026 results early next year.
Thank you. That does conclude today's conference. We do thank you for your participation. Have an excellent day.