Earnings call transcript Q2 2023

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Operator

Hello, and thank you for standing by. My name is Regina, and I will be your conference operator today.

At this time, I would like to welcome everyone to the Donnelley Financial Solutions Second Quarter 2023 Earnings Conference Call. [Operator Instructions]

I would now like to turn the conference over to Michael Zhao, Head of Investor Relations.

Michael Zhao

you. Thank and Results joining Conference everyone, Second Financial you XXXX Quarter Call. thank morning, Donnelley for Solutions' Good This morning, which we website supplemental in trending released Investors at our earnings of the results, report, dfinsolutions.com. historical copies of of section can found schedule be our including a

risks During call, to to that are forward-looking this uncertainties. statements refer subject we'll and

on report a discussion, please our included Form release earnings our details other complete the refer in statements filings quarterly For SEC. and recent most Form XX-Q and report annual in on to the XX-K, further with cautionary

evaluate information Further, for and for the and we is will company's refer such believe financial financial discuss Please as sales. the performance. useful net way you purposes EBITDA, for certain tables the margin They the non-GAAP to reconciliations supplementary provided GAAP EBITDA appropriate provides non-GAAP operations of you concerning non-GAAP financial related are, information ongoing GAAP adjusted informational and We and presentation company's financial adjusted however, an organic information. with information to only. of information earnings release to

I Johnson, Strimling to Kami am Dave I Dan by call Turner. the now Floyd will turn Dan. and Clay, Craig joined over morning Gardella, this Eric Leib,

Dan Leib

Thank everyone. you, and morning, Mike, good

difficult in are of this $XX.X adjusted of sales of operating quarter, company's and net environment, continuing second resulting We pleased delivered results, transactional performance million of light including In the we EBITDA second especially XX.X%. adjusted softness markets million, in with during the activity. in quarter $XXX.X capital margin EBITDA strong

environment our the sustainability transform. to of resiliency demonstrated business a and mix performance of challenging model quarter continues in second Our again operating the once our as performance external our

is second our A quarter performance portfolio. the key of driver of improving our Solutions Software results

quarter X% few over XXXX, quarter Solutions' the nearly net an in increase versus basis second an quarters. growth trends the to on last of organic the the second from sales accelerated Software growth

was compared year-over-year growth of net offerings, quarter Venue stronger trend. the key software recent second Suite, Solutions broad-based, Arc growth our X to with delivering Importantly, sales Software all ActiveDisclosure, and

made points Solutions second from second total of net XXX year's basis approximately quarter Software XX% sales, sales up up mix. approximately last quarter

reminder, a represents meeting proxy the software seasonal represents as low our and overall historically season, due largely quarter annual second to largest As a revenue. of a quarter, the yet for percentage

XX% On a sales, approximately an trailing period. X-quarter basis $XXX of XXXX quarter X from represented of of approximately increase software of the second million basis, sales points quarter XXX trailing total

adjusted year's a million in adjusted XX% of is second strong Our quarter margin EBITDA very with second margin EBITDA nearly XX.X% despite sales. markets transactional last year-over-year quarter in $XX capital reduction nearly line approximately or

environment. quarter, efficiencies in we simplification, progress simplify previous actions, demand with driven structure market addition further in our process to improvement These cost the the made During our current to permanently combination operations by in resiliency various and across reduction conditions. cost achieving costs, efforts, our fixed improve adjusting DFIN's second additional reduce and

existing these areas drive margins, business revenue growth processes. accelerate our of cost benefited we to modernize savings business continue to certain and investments While recurring our in

investment with objective of initiatives, Through and the approximately the XXXX approximately stated on of of which of basis. are first X/X half growth modernization to related a track we the year, these investing incremental million in $XX total on year-over-year our is

outstanding delivering consistent performance, the by demonstrated progress our results. our against As plan is

during serve is times compliance volatility. of the which our of the difficult offerings, market testament a with Specifically, These ongoing and our investment Software recurring of Solutions and strength to Tech-enabled to thrive market companies Services, needs our across offerings. both conditions business corporations ability and span in provide stability

importantly, associated update XXXX. detail, mix an of shareholder growth more recurring to benefit the but of revenue continue such from toward I'd reports transactional share provide tailored to first, recurring will and with financial like in shift our date a we Dave on will July offerings, to accelerate protecting compliance results model. higher our regulation, cover DFIN a which more has in invest market our the we a As while recurring profile traditional revenue,

technology seamless From We and are making and funds plans, that with leading capabilities, we Suite our eliminates development service to development the while help expertise our introducing aimed DFIN's operationalize a product and comply created client clients which great clients. with software to are the go-to-market modern our for functionalities Arc have handoffs a of mutual progress end-to-end this Coupled compliance in our within to features and fund solution leverages solution perspective, both exchange-traded create reporting additional regulation. production a experience. true

the encouraged especially pipeline and recurring positive of the are by feedback market revenue. We

sales Given including across be we offerings, recognized and expect Distribution. solution, multiple our end-to-end Tech-enabled Solutions, Services Print Software will DFIN and

working the providing year. We or to forward later look additional year are impact and currently early next to quantify estimated this details

to I Dave to more on like for the second turn outlook remarks, quarter. third results would our Before call I Dave? closing our share to a provide and quarter the details few over

Dave Gardella

and good morning, everyone. Thanks, Dan,

the growing sales, slightly quarters. efficiencies XXXX than basis transactional of sales reported high-margin despite higher respectively, while those second compared we transactional second to and the results points similar volumes, quarter levels transactional overall reduction on Solution to XXX historical continuing second in approximately DFIN challenging quarter adjusted activity. strategy a noted, sales EBITDA margin XXX become year-over-year year's we quarter environment. quarters XXXX this By focus delivered and and of quarters our efforts operational focused Software with have Dan in enabled sales As in and our ongoing fundamentally basis in level more being overall also to execute to points strong Despite below an was profitable second our

being results results second provide evolving while and structure us also a mix, various is to managing stewards to our sales more strategy quarter market that of our disciplined invest to Our proof across capital. positive continuing additional financial allowing points deliver strong aggressively cost recurring working, conditions and

of a from decrease million, quarter an XXXX. $XXX.X XXXX second million basis, of of total On or a on for second $XX.X and basis reported on consolidated the a net were sales X.X% organic the quarter X.X% basis

year transactional partially Given net in year-over-year $XX.X capital the offset new by environment, to net million which increased reached of occurred more growth $X.X The down markets quarterly transactional markets or quarter on second basis sales, was decline the or weak all transactional XXXX. reported of basis in net of XX.X% than was quarter the an sales in sales million organic X.X% versus Software a sales, a Solutions on decline compared X.X% last record. and which second capital very and the sales

XX.X%, lower XXX basis margin than higher was by investments cost Second primarily points increases, the driven and and transactional quarter of of the initiatives second markets partially activity quarter gross approximately capital by incremental savings to adjusted offset our price XXXX, accelerate transformation. non-GAAP impact

$X.X the Adjusted million, second XXXX. quarter decrease non-GAAP SG&A from was expense of in a million $XX.X the quarter

investments the partially percentage a XXXX. an sales, adjusted reduction SG&A decrease transactional net cost non-GAAP As SG&A a sales by expense. was a from impact of incremental XXX of by as debt in control initiatives of volume, was second driven approximately quarter primarily increase non-GAAP result higher XX.X%, bad of of and points transformation-related The expense in offset and adjusted the lower basis selling

XXXX. $X.X $XX.X million, from EBITDA Our XX% second or of a quarter adjusted the decrease quarter was of million second

lower XXXX, basis and control sales of from points was of support driven adjusted EBITDA capital initiatives, the a price margin offset cost partially of by a as XX of markets strategic incremental by investments uplifts of decrease volumes. approximately quarter primarily the quarter in selling sales XX.X%, our and second result Second lower transactional transformation impact lower expense

quarter second ActiveDisclosure, both last increase X.X% expected year. quarter subscription increasing our $XX.X organic in with results. approximately Sales transition the second grew our as to segment improvement product, the Software decommissioned the Solutions quarter. an from finalize the the the quarter from basis sales in of ADX, in compliance segment we of of our was of X%, which X% Capital Markets now Turning approximately which component second million, Net were second recurring an recurring on reflect

stronger decommissioning new and increased on growth an retention platform greater also important while milestone for to enables pricing, us The the and AD driving represents efficiency. rates focus higher realizing

rates growth moving improved expect We forward.

compared $X.X for level room of X.X% and quarter our a the driven driven increased activity continued were of completions, remains year, offering sales second by and or of the steep Net underlying Despite last room pricing. up strong, deal virtual venue higher deal demand abundance the to capital. M&A strong decline million activity the of high-quality global in by assets

virtual underlying taking activity the We our on room place are encouraged platform. data of resiliency the by

offset by Venue of incremental within Adjusted to was second increased increased segment primarily from investments costs EBITDA new our overhead XX.X%, and approximately of technology sales, AD uplifts price development. XXX points for margin efficiencies an partially due XXXX, in the organization, the service and from quarter increase and an basis

Capital on an our Compliance Markets, lower XX.X% in in segment compliance were organic the of activity, from and Management modest second quarter partially revenue. transactional of capital basis $XXX.X offset sales by XXXX, a driven markets a by year-over-year Communications growth decrease Net million,

consistent in remain experienced quarter, transactional a with first pickup increase on demand call. year, which slight deal a we the in quarter transactions modest for second quarter's the indicated last this equity basis, While on earnings the to weak very sequential start activity of revenue year-over-year the we from

lower quarter. place ended the pricing positive the second we X note quarter, IPO of a market remains That start IPOs so year's to year. for this of streak still taking Similar with to activity the substantially representing the far second overall toward IPO June, most end the what priced experienced transactional last also the quarter on active than said,

weak, M&A quarter. the XXXX first and approximately from M&A XX% of with The very down last number completed second the year's versus remained quarter sequentially market down of transactions

uncertain, capital DFIN and share a transaction-related environment very the markets for picks of positioned transactional While up. capture services future for significant demand when to market is activity products well outlook remains

half in the third creates seen the uptick entering momentum to of start June activity in IPO transactional quarter second we've year. the activity the positive Additionally, the and

Compliance X% with The and grew from part the the of second higher sales volumes, increased decline pricing. Capital disclosure primarily new performance offering, pay versus transaction of partially approximately in our was is by which Markets by proxy driven offset XXXX associated which quarter markets capital

of approximately performance was a XXXX, quarter of capital very Our in which second XXXX. versus by the during increased the sales quarter the second quarter compliance backdrop compliance markets sales second growth against strong XX% of

services. we of previously, discussed faced quarter the creates couple liquidations, and a offset pricing. increase into recent able for public which demand and quarter, compliance trend headwind higher on in the first the second timing volumes by compliance including were We of headwinds the shift to combined the companies number the impact more activity well in headwinds as the those of back certain the as of than the of increased associated from quarter As a proxy

basis lower XXX EBITDA quarter approximately from of primarily cost decrease a decrease lower The XX.X%, expense the XXXX. was due in segment second lower offset points margin bad selling sales adjusted by debt and control the price for initiatives, transactional margin sales as was partially result expenses a of and increases. the EBITDA Adjusted of higher volume to

million, our $XX the subscriptions continued an second in XX.X% as XXXX, basis Net a were Software Company adoption strong by companies. of driven an segment Investment of investment within increase quarter sales Arc of growth of the in Solutions versus on primarily Suite organic result

reports, created are future of Arc tailored growth. second the revenue recurring remain in shareholder as opportunities drive We regulations, by the optimistic such by the performance encouraged quarter Suite about and to

increase in second product was primarily Adjusted quarter growth increase within approximately sales the segment to support higher the the leverage adjusted XX.X%, opportunities. of partially EBITDA our in increase EBITDA offset an margin The was operating due from service on and in organization, development margin of investments efficiencies by basis and XXX of technology XXXX. for points

driven Net were second sales Compliance an XXXX, Communications Investment X.X% of partially in of our Management the by by offset of exit basis and work. price print organic quarter from work, low-margin increases on primarily a the segment remaining million, decrease Companies on $XX.X the

the the our platform impact Adjusted adjusted due quarter XXXX. from favorable was EBITDA print segment initiatives, points a in of XX.X%, by primarily consolidation, approximately partially costs. the than offset and of EBITDA margin overhead continued synergies sales higher cost margin was increases, including increase reduction higher to second The for price mix, XXX basis

expenses by quarter, the second unallocated $X.X of cost in by at increase initiatives. from our million in driven of aimed primarily an increase offset XXXX, the partially impact transformation, Non-GAAP corporate accelerating $XX.X of expenses control the were million quarter an

offset a by free restructuring million, tax EBITDA, the Free the compared million partially in higher payments, positive cash of $XX.X second in lower flow quarter adjusted as quarter $X lower driven and and interest was XXXX. cash year-over-year was by cash The decrease decline capital of flow decline a payments. to in expenditures

of non-GAAP remaining of million of debt on drawn and the million debt, $XXX.X million revolver. well we of liquidity our as had as $XX.X We revolver a total million $XXX.X $XX.X hand. perspective, net From including access million the $XXX.X cash ended on quarter to with our

As XX, our X.Xx. ratio was June leverage of XXXX, non-GAAP net

our reminder, flow cash a is seasonal. As historically

in We the cash of year. breakeven and of are a to the in second of in half than the quarter XXX% close cash the flow more free generate first user quarter, second our

As our to sales subscription-based become expect mix the we continues to continue less proportionately sales, to seasonality evolve more significant. to

XX,XXX shares during per an our the price of for of Regarding average stock capital deployment, $X.X $XX.XX second we million common repurchased approximately share. quarter at

remaining million of on our repurchase $XXX.X $XXX authorization. As June had XXXX, stock XX, million we

quarter, priority floating management second resulted in we to higher our rate high lower to the a share Given and environment ongoing assign the debt, debt continue which in interest repurchases. rate

we to deployment. forward, approach balanced will a take capital continue towards Going

view reduction, area. continue net components deployment our as drive transformation, key to strategy, disciplined to and our capital remain of We investments repurchases organic share in and this each we'll debt

it the recent outlook the overall expect challenging, third for remain pickup in XXXX, to by macroeconomic we while we encouraged our modest As are transactional environment quarter relates to of activity. the

of low of quarter third to net expect million last and in adjusted We as a approximately of million, we lower than a a our midpoint margin the sales of consolidated million first X revenue less year. to in year, $XXX activity, $XXX the experienced net X%, transactional the decline guidance, range the in sales the quarter implies EBITDA third decline Compared range. the $XXX year-over-year quarters of mid-XX% the of result year-over-year primarily to of

our of lower to our perspective, mid-XX% investments From similar an well made improving investments and first technology incremental and of toward the incremental transactional of sales contemplates margin the to efficiencies, EBITDA the quarters. guidance as low operating adjusted in level development as level second

EBITDA much historical and adjusted quarter total third margin to like again quarters our be once size sales. expect We of stronger than transactional

With to now back it that, pass I'll Dan.

Dan Leib

Thanks, Dave.

a point resilient durable quarter past. offers the Our that second make the execution further performance and and more to structurally strategy in than proof continue in DFIN our

to recurring capital. we structure stewards continue invest aggressively on profitable we transformation As our continuing opportunities journey, while growth our progress and cost to manage will of in revenue to also disciplined drive being

ESG, clients shareholder Transparency regulatory on in Data excited horizon, are starting including they solutions by we're the changes and compliance will to with the by benefits the regulations. opportunities We XXXX. In bring on Financial creating and created meantime, help tailored reports, comply Act and our focused best-in-class regulatory

we Finally, transactional as improved second trend we the of half into encouraged are by capital head activity. in the markets year, the

the clients it DFIN who open receive have world thank solutions. I'd working Q&A, been for to continue to we to the the Before around like ensure our up tirelessly highest quality employees

Now with ready that, operator, questions. we're for

Operator

with CJS will question first Charles Our Strauzer of Instructions] the [Operator Securities. come from line

Charles Strauzer

taking And going potential versus at on on that there of we there for could upside I you've been drive front? the cost from delve margins? the efforts continued was efforts what really, bit on hoping guidance permanent is and portion the looking into you to could temporary? QX, And more a maybe there reduction cost the little see what's

Dave Gardella

Yes, Charlie, Dave. I'll one. take it's that

range across I they certainly that across regarding -- think cost would quarter are say permanent, commented reductions, taken the certainly really out -- quarter actions company. we've and the and we've I right in,

you higher think margin look reflected in the -- at reductions, our they're when cost I what's in than fact, actually performance. gross

the well to increased we're which both recurring noted Software increase savings as that the predominantly, other amount our in and redirected support are and areas proportion development And past the to to Sales revenue. of the product really portion growth we've to investment of we've as in those our of areas continuing And IT, in a that's in value. of invest create drive strategy long-term to

I the trends. can think that comment, see our margin permanence on in you historical

the and historical We margin. have deck, shows a consolidated investor transactional the it slide in our revenue company's

percent points continuing be certainly trailing the will to by mid-teens for the fourth average, And around forward, focus driving it, our million. call right a But environment. substantially That's challenging also to in from, $XXX below invest us, EBITDA at historical X,XXX revenue, improved mid-XX the this to transactional margin importantly, basis strategy. look the it's continue the going efficiencies. You about despite the has quarter yet

don't I if know to Dan, to you that? want add

Dan Leib

Dave, Thanks, Yes. and thanks the Charlie. question, for

couple of a amplify Yes, just maybe things to on permanence.

-- being the is that business. most really As majority in Dave said, reason these -- the them way the changes of permanent, are do driven are are change the these by and we it's of

improvements products in there's so external we made of have serve terms of a and way been clients. And lot externally-facing that the

we've past that's ahead new years monitoring, several metrics workings are also efficiency us also inner on and the work. to do being led And the company also of et the put and over more driven And then Dave numbers. these spent we of company. as within the place, of And and new cetera, net what's work said, how transforming that's in ways

product in proposition. We the invest and continue employee to new then both enhancing in as also Dave value development, mentioned,

we've happen. a who we around just the to world done results associates improve are the to lot So what the making strong offer

us, And happy accomplished so thus lot what but far. more of we've with a ahead

Charles Strauzer

Great.

behind this at a year? of into follow-up. you that? of strength the Just what the little Sales sustainability drove Software look the the in half When more quarter, a quick And back maybe that color bit

Dan Leib

sure. Yes,

uplift signaled with as a was had bit the towards saw so an each little I mentioned, about a with ADX, And we half occurred earlier decommission that in than broad-based, sales product. that it good in We We we June, maybe in to that one. as momentum feel a of signaled quarter have see story which we expected and the probably -- in that work start the had expected, back ActiveDisclosure. we So of we so different and I'll growth.

lot may good et the performance, half. to more is at -- really been back M&A. go case feel the had volatility so utilizing main performance, and Venue, -- Obviously, quarter deal of look cetera. that's a that use case seen in, and its that fact the private, have we've But broader the terms it to the in strong we into for heading be out, We seen that really strong seen has use transactions that room, can private hasn't quarter about deals back offering despite had our we've and just there's Venue

our in growth that last be said had Suite, had level, a well, was quarter, there Arc thought strong As bit forward. the the which going sales higher and same of in a we depressed quarter growth we would

So that's to of initiative. at the Arc there, feel obviously relative Suite for again, we're independent 'XX looking good and what in TSR

Operator

next the Peterson comes from of with Your line question Kyle Needham.

Kyle Peterson

Great.

to the and like of may activity about assumptions Markets optimistic so? bit assumptions far, behind a touch of any some I the you for seeing wanted been but be or the X so quarter. improvement for the on the quarter? guys guys in what weeks Capital Any deterioration? for Is would past Capital It coming the of XQ balance kind the Markets of quo you helpful. put how a about status guys terms the guide guess in kind started Just quarter or were in it have the little and how guide, expectations assumptions what of sounds you ended Or

Dave Gardella

the for Kyle. Thanks Yes. question,

and I'll at of that implying, in million the I $X the million in $XX guidance. talk and in between I sequentially right, somewhere Markets, QX. our first, sequentially or went at range think transactional guidance right, range, probably you million activity what $X midpoint when the we're looking think again, the same up We're QX and Capital look at

muted a to a then certainly that it's the in think year-over-year relative on QX. decline, that decline, I still year-over-year declines and saw we basis, but QX

that the pickup, So again sequential through essentially I obviously and right? quarter, expecting modest flowed optimistic, would uptick cautiously The in sequential activity say, in QX. here to impact had June a the in that

Kyle Peterson

guys if in I some newer at wanted helpful. least strong quantify It I follow-up kind see of gains really whether be it some And upside performance quick order on this out sense, of both just quarter. that came from a this and much to called that on like with That versus strength and wanted pricing or versus a it's you pay seems do disclosures, makes you know I here but compliance. of guys and kind came of quarter? share these cross-sell, how rank pricing initiatives? Maybe or upsell could to

Dave Gardella

specifically, behalf and of out What segment bring the the driven and assume to by goes I work. compliance Communications tough the was again, performing driven blend by some I of some Compliance up. et you're cetera, of compliance about there. additional that of right, The clients, it's again, kind talking X as and pricing. vast of revenue performance, And work it And it the in Management together, aggregate we're say, would Yes. proxy-related, pricing majority on

bit difficult overall a generally, to it's So the strip there. apart, those proxy but two driver was

Craig Clay

add if David, you to me wanted Craig. that. Yes, to It's

XX%. So from so growth, 'XX, perspective, QX over big we a have of quarter. this with the X% pleased And compliance

we the work result in which with table. is price the new You value adding. inflationary increases. were the capture number a of we're And which our tagging pay clients We're that exact for certainly, an of environment, is performance, of mentioned able then client things that comp versus certainly to it's increased and a disclosure count, areas,

our CNCM experts relationships deal network business, or show compliance we're team or our our or really whether entire ecosystem The that our and here software. it So extensive leveraging I throughout really DFIN, at results CNCM in benefiting this it's shows. Software, is of certainly think and reoccurring

Kyle Peterson

All helpful. sense. That's right. Makes

Operator

comes question the line Your D.A. of next Heckmann Peter Davidson. with from

Peter Heckmann

that then up, that's bit increases wage -- moving Can you come that about price Software, inflation-related you sign. you a much but on between -- on Tech-enabled to regular about guess, wanted price is Hearing the price Services? a year always think talk bit think for increases sense kind you've allocate little you but little missed how up? a And of how of kind I I about again. don't quantified. it, I do talk good that I

Dave Gardella

Pete, Yes, start. I'll

when product think that. to Craig the environment, look I and of up will at vary perspective, some at certainly it's product. least mitigate from a from or inflationary the you efforts pricing of it some to keep mentioned just

when going to and the price right? ramping ActiveDisclosure teens And about from mid- still average. it, look levels place AD, lot incrementally, taken up think transitions of digit mid-single in up, of you and at over that I has high years, to that talked product, ADX on on last the new A the couple so we're we work XXXX. that's probably, call

I Kyle to look we're basis more point, it's it's split but question, But And from of consolidated I work product more, doing -- my getting indicator. you part. some also difficult digit we're think to in a asked when low single is is this product. yes, that company. so that decent earlier the a paid sometimes single aggregate, digit low But And to then the when to will probably much vary think closer on for again,

Peter Heckmann

Okay. And then Craig. --

Craig Clay

in it this maybe our contracts. Yes, a frame the value so capturing that's the capturing a for bit. on were realm, up whether the It's so we the whether maybe little better It's -- value delivering, is client price To it's recognizing it's built-in product, renewals. just of service increases signing Craig. value, multiyear

being to forced to deliver competitors are that We clients buy where with bring not have for our we're to using. price our us modules want, what pay opportunity where able an not able they're they them and as to

that creating opportunity So and meet to capture the it's for at. value market we're the an us it's where really

Peter Heckmann

it occur helpful. out, potential share of I figure you get and tight like we've basis? quantification And range, could in work about That's $XX talking in to give benefit? That's the trying just something classes $XX broad still to the some I the a it is of it reports the us tailored an trying range $XXX I'm about of reasonable have just really Okay. printing know some But you're the to might then million the for or additional been like mean, a annual does think terms to benefit? helpful. interesting is the while, sort of multiple million seem on of a potential million benefit. opportunity. shareholder thinking that and

Dan Leib

sure. Yes,

I'll Dave, So weigh start, certainly, want if and to in. Eric you or

you're in be about We certainly think there. will and it Tech-enabled put and Services terms Print it numbers thinking the Software, right broad-based will of way a benefit I across out Distribution.

be later a This this effect will can next requirement think it to goes so mentioned, or year level, multiplier fund is beginning of an share a -- or is there. year. you that opportunity class we that from about As level

That just charge we that mentioned, value look on said, based to the Craig we're as -- we add.

this and is et We also work the side. know have compliance-related clients fund our fee pressure, ETF and on cetera,

end half selling of to selling of third-party 'XX, beginning year, year. we're starting year administrators forward into next but both asset be guidance So and look managers, we're also the providing on we'll this a starting, additional and into the impact in and it will

Peter Heckmann

Okay. right. All

Dave Gardella

be likely get kind XX%, Dan's then effective clients the you full their cycles less starting X on, Depending just comment, the a And the year year. midyear sorry. timing becomes that overlapping be report Pete, in year each next as rule of the the on would and will probably funds half impact reporting than XXXX. of on the impact

Operator

[Operator Instructions] from And your of come B. the next Sharma question will Riley. line Raj with

Raj Sharma

good can better. understand QX into I I'm Congratulations outlook the to for If the on jump a trying guidance? quarter. --

part? down, you're Given outlook And about in transactions transactions Up, performance sequential Print can compliance? QX? seems in versus I on conservative. Software, part look QX, or versus you seems we If it the talk compliance? results then The comment at can them, or expecting -- Tech-enabled QX or

Dave Gardella

it's Dave. Raj, Yes.

I and million you around I'll $XX $XX transactional $XX transactional. what you sequentially, about the just think and reiterate million guidance if right? specific to are think QX, at to So estimating our million on at from of we said transactional, I went midpoint If QX over look

at look Compliance, and than But again, kind the in you year, on to of it sales at call the much Capital we And range XQ or that the the challenging balance just look the in it, guidance, that year. and the the given when Compliance our flat higher more when was, that's of that think in the QX. of up are flat on analysis side. midpoint Compliance I first half the you at is broadly year-over-year basis, of XQ and drive Certainly, QX a slightly seasonality that's And of Markets QX. of for inclusive business.

we down, software. shift compliance Investment again, we've when that to little half half a companies look think, investment range Compliance from again of In less. million that work, of expecting year. year. of Companies the some Generally, in some the I And the the traditional over in think the at was seasonality, seen $X.X again, in bit couple I the first back of revenue compliance quarters, something first

Raj Sharma

QX IPOs, And on -- level it. actual the much makeup? of results then you was about transactional the M&A How and... for and can Got talk the

Dave Gardella

Yes.

So basis, in the as I activity see in can to want we we you quarter IPO. jump said, kick of at, within off that down as M&A Craig, started the difficult. on looked in IPO June some detail broad we with to better very exited and there? very, pretty XX% and they of M&A and then markets, the add a benefit reasonable was remained saw most was anything year-over-year as we look additional here. if When Craig, well. little bit so to a July We commented

Craig Clay

Yes.

be that go even year. have In back million, XXXX to look that least. CapIQ, at to it billion, -- the say been to $X the deals find think has challenged, $XXX doesn't you close. reiterate, certainly market whether it's that When the M&A an from it XXXX comes quarter, we it's are significantly was before have whether you market to even COVID the I a

So it challenged. M&A in certainly, market, was

For but well And fewer. holding a many it's to been we've the share be and are recovery is fully from our are not yet, not IPO as that's straight just a there that there, perspective, doing market announced, we've about. line, to upbeat It deals reasons pretty open then is an going the be rebuilding. talked

we pipeline the million and a of have of the is stands to that historic about who now include companies lot a in talked is that water does and but confidentially. companies at line. filed $XXX The bit over it go publicly we deals publicly So movement our under [XX], for share see filed of not strong, which still July, quarter, the little we

So resurgence appear the the to that which be what IPO really to that our at are market clients lifting. is barriers us, in gets telling

NASDAQ. pick clear can whether XXXX to the metric, in going it's into starting XXXX. the this backlog you So to moving then we're Fed, whether it's your But see is what and likely

a to better it's we excitement, line talk certainly, straight it accelerate. won't but the So be as about

Raj Sharma

what Sales, or Software years, recent Sales. By And I we to of software the of that next lastly, can over years, then sticking sales? are you've or... next in 'XX about talked just talking double you've few Great. And Is we're the the kind still year know few to? doubling target you guided the past 'XX, that Software about fiscal

Dan Leib

Yes.

you So to I me and it. -- if let can on then start that, grab Dave, want

of we progression. software product about were think if at look I or $XXX linear So not over spun so there million a can just you several uneven out, the we given when at and doubling revenue, years. there's line, you Obviously, the look and historical the

So I or range. something XXXX, software think that in in up XX% we're about sales in

so and talked starting Obviously, and offerings hitting with the area the the about areas than see of as benefit forward, pick and speed. hitting we're as regulation TSR Venue, some other that have will software part is part be to regulations of to in compliance we up some guidance and additional the Venue helpful, we've compliance given benefit the the M&A, And of that that slightly will company. the lower in I've we've the sensitive mentioned, look growth offerings,

Raj Sharma

Right.

all. implies So is growth to that rate time out XXXX the that pretty software strong And period? revenues, -- in million XXXX, a getting to that's $XXX

Dave Gardella

Yes, Raj.

Sorry. It XXXX. top was in $XXX million, that's and

Dan Leib

Yes, of which the total is where XX% you the is to to the -- so. or XX%, get which

Operator

for I the over back closing remarks. Dan any will now to call hand Leib

Dan Leib

joining and Great. and near Thank you. thank in Thank you, forward the to Regina, everyone speaking you for us, future. we look

Operator

all you for Thank conference. joining. today's conclude will That

disconnect. may now You

Donnelley Financial Solutions (DFIN) 2 Aug 232023 Q2 Earnings call transcript