CIMPRESS plc (CMPR) Q1 2026 Earnings Summary

Executive Summary

• Q1 FY2026 delivered 7% reported revenue growth to $863.3M, organic constant-currency growth of 4%, and record Q1 adjusted EBITDA of $98.7M; gross margin fell 80 bps to 46.7% due to mix shift toward elevated products .
• Revenue and EPS beat Wall Street: revenue $863.3M vs $842.8M consensus (+$20.5M), EPS $0.30 vs $0.285 consensus; 2 estimates in each case. Values retrieved from S&P Global*
• Management reiterated FY2026 guidance (5–6% revenue growth; organic cc 2–3%; ≥$72M net income; ≥$450M adjusted EBITDA; ~$310M operating cash flow; ~$140M adjusted FCF) and reaffirmed a path to FY2028 ≥$600M adjusted EBITDA and ≥$200M net income .
• Catalysts: continued double-digit Vista elevated product growth, strong Upload & Print momentum, minimal net tariff impact (<$1M), and visible AI-enabled service efficiency gains; share repurchases (45k shares, $2.7M) and currency tailwinds supported results .

What Went Well and What Went Wrong

What Went Well

• Elevated products drove Vista double-digit growth in promotional products, apparel & gifts, and packaging & labels; VistaPrint variable gross profit per customer rose 7% YoY from $79.82 to $85.32 .
• Cross Cimpress Fulfillment (XCF) expanded across segments; Upload & Print revenue grew 15% reported (8% organic cc combined); XCF previously added $15M gross profit in FY2025 .
• AI-enabled customer care improved efficiency by 6% YoY via generative chatbot, agent assist, and self-service; management highlighted operating expense leverage following FY2025 cost actions .

What Went Wrong

• Gross margin compressed 80 bps to 46.7% as elevated products carry lower margin percentages despite higher gross profit per order .
• Tax expense rose to $17.8M, absorbing most of pre-tax income ($24.4M); management advised focusing on cash taxes which will be higher YoY due to last year’s refunds not repeating .
• Adjusted free cash flow was an outflow of $17.8M given seasonal working capital and higher capex/capitalized software; central & corporate costs (ex-SBC) increased $1.4M YoY due to higher compensation and MCP adoption .

Financial Results

Segment breakdown

Segment EBITDA

KPIs

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “Elevated products are driving a step function improvement in Cimpress per customer lifetime value… Vista grew revenues from promotional products, apparel and gifts, as well as packaging and labels, at double-digit rates year over year.”
• “Vista rolled out generative AI, chatbot agent assist, and Customer Self Service features that have collectively improved customer care efficiency by 6% year over year.”
• “The impact of tariffs was pretty minimal, less than $1 million on a net basis for the quarter… we offset almost all impact through pricing adjustments.”
• “Our Q1 results were ahead of the pace needed… we feel confident… to meet or exceed [the] guidance… adjusted EBITDA of at least $450 million.”
• “Successful execution… would result in at least $200 million of net income and at least $600 million of adjusted EBITDA in fiscal 2028, with ~45% conversion to adjusted free cash flow.”

Q&A Highlights

• Tariffs: Minimal net impact (<$1M) with pricing offsets; de minimis removal impact immaterial; largest exposure remains National Pen, mitigated via pricing and supply chain .
• Holiday quarter setup: Better structural calendar vs last year; organic search headwinds addressed; plan to lean into strategic strengths despite competitive pricing pressure in peaks .
• Taxes: GAAP tax expense elevated on higher profitability and non-repeating refunds; focus on cash taxes, expected higher YoY .
• Guidance pacing: Q1 revenue growth exceeded annual range; EBITDA pacing ahead of plan to meet ≥$450M; emphasis on strong execution in Q2 .
• Shareholder engagement: Met with Spruce House; management focused on execution to close price–value gap .

Estimates Context

Comparison vs Wall Street consensus (S&P Global):

• Q1 2026 beat on both revenue (+$20.5M) and EPS (+$0.015); Q4 2025 revenue beat (+$25.2M). Values retrieved from S&P Global*
• With elevated product momentum and advertising efficiency, estimates for FY2026 EBITDA/FCF trajectories may need upward revision if mix-driven margin pressure moderates and currency tailwinds persist .

Key Takeaways for Investors

• Elevated product mix is scaling; despite lower percentage margins, higher order values and variable gross profit per customer underpin profit dollar growth and LTV expansion .
• Record Q1 adjusted EBITDA and reiterated FY2026 guidance reflect operational strength; Q1 pacing ahead supports confidence in ≥$450M adjusted EBITDA target .
• Tariff risk appears contained with minimal net impact and active mitigation; supply chain and pricing agility reduce downside volatility into holiday season .
• Advertising efficiency and AI-enabled service gains are measurable (80 bps lower ad %; 6% care efficiency), offering operating leverage as elevated products scale .
• Cash and liquidity robust ($200.5M cash; undrawn $250M revolver); net leverage steady at ~3.1x with clear multi-year deleveraging path to ≤2.0x by FY2028 .
• Near-term watch items: gross margin trajectory amid mix shift, cash taxes trending higher, central/corporate cost growth tied to MCP adoption .
• Trading implications: Positive momentum and beats vs consensus, coupled with reiterated guidance and capital allocation flexibility (repurchases), are likely supportive of sentiment; monitor Q2 execution and holiday demand normalization .

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* Values retrieved from S&P Global