v3.25.4

Share-based Compensation | 12 Months Ended
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Dec. 31, 2025
Share-Based Payment Arrangement, Noncash Expense [Abstract] |
Share-based Compensation | Note 12. Share-based Compensation The Company’s share-based compensation plan under which it may grant future awards, the Donnelley Financial Solutions, Inc. Amended and Restated 2016 Performance Incentive Plan (as amended, the “2016 PIP”), was approved by the Board of Directors (the “Board”) and the Company’s stockholders and provides incentives to key employees of the Company. Awards under the 2016 PIP may include cash or stock bonuses, stock options, stock appreciation rights, restricted stock, PSUs, performance cash awards or RSUs. In addition, non-employee members of the Board may receive awards under the 2016 PIP. Increases to the shares of common stock available for issuance under the 2016 PIP requires stockholder approval. On May 13, 2021 and May 14, 2025, the Company’s stockholders voted and approved 3.4 million and 2.0 million of additional shares of common stock, respectively, for issuance under the 2016 PIP. At December 31, 2025, there were 3.5 million remaining shares of common stock reserved for future issuance under the 2016 PIP. For share-based awards granted to employees and directors, including RSUs and PSUs, the Company recognizes compensation expense based on estimated grant date fair values as well as certain assumptions as of the grant date, if applicable. The Company estimates the number of awards expected to vest based, in part, on historical forfeiture rates and also based on management’s expectations of employee turnover within the employee groups receiving each type of award. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods, if actual forfeitures differ from those estimates. The Company recognizes compensation costs for RSUs expected to vest, on a straight-line basis over the requisite service period of the award, which is generally the vesting term of three years. The Company recognizes compensation costs for PSUs, which cliff vest, on a straight-line basis over the performance period of the award. Share-based awards are subject to forfeiture upon termination of employment prior to vesting, subject in some cases to early vesting upon specified events, including death or permanent disability of the grantee or a change in control of the Company. In addition, upon a change in control of the Company, PSUs will be measured at 100% attainment of the target performance metrics and will remain subject to time based vesting until the end of the vesting period; provided that the award will vest in full if, within three months prior to or two years after the date of the change in control of the Company, the grantee’s employment is terminated without cause by the Company or for good reason by the grantee. Total share-based compensation expense was $31.4 million, $25.2 million and $22.5 million for the years ended December 31, 2025, 2024 and 2023, respectively. The income tax benefit related to share-based compensation expense was $8.8 million, $10.4 million and $9.2 million for the years ended December 31, 2025, 2024 and 2023, respectively. As of December 31, 2025, $35.1 million of total unrecognized share-based compensation expense is expected to be recognized over a weighted-average period of 1.6 years. Stock Options The Company did not grant stock options during the three years ended December 31, 2025. The weighted-average fair value of options exercised during the years ended December 31, 2025, 2024 and 2023 was $6.69, $5.92 and $4.94, respectively. Stock option awards outstanding as of December 31, 2025 and 2024, and changes during the year ended December 31, 2025, were as follows:
|  | Shares Under Option (thousands) |  |  | Weighted-Average Exercise Price |  |  | Weighted-Average Remaining Contractual Term (years) |  |  | Aggregated Intrinsic Value (millions) |
Outstanding at December 31, 2024 |  |  | 312 |  |  | $ | 18.22 |  |  |  | 3.2 |  |  | $ | 13.9 |
Exercised |  |  | (94 | ) |  |  | 20.32 |  |  |  | — |  |  |  | 3.1 |
Outstanding at December 31, 2025 |  |  | 218 |  |  | $ | 17.31 |  |  |  | 2.4 |  |  | $ | 6.4 |
Vested and exercisable at December 31, 2025 |  |  | 218 |  |  | $ | 17.31 |  |  |  | 2.4 |  |  | $ | 6.4 |
Restricted Stock Units The fair value of RSUs was determined based on the Company’s stock price on the grant date. The weighted-average grant date fair value of RSUs granted during the years ended December 31, 2025, 2024 and 2023 was $48.31, $65.16 and $42.51, respectively. RSUs outstanding as of December 31, 2025 and 2024, and changes during the year ended December 31, 2025, were as follows:
|  | Shares (thousands) |  |  | Weighted-Average Grant Date Fair Value |
Nonvested at December 31, 2024 |  |  | 621 |  |  | $ | 47.62 |
Granted |  |  | 339 |  |  |  | 48.31 |
Vested |  |  | (271 | ) |  |  | 45.67 |
Forfeited |  |  | (35 | ) |  |  | 51.44 |
Nonvested at December 31, 2025 |  |  | 654 |  |  | $ | 48.58 |
As of December 31, 2025, $16.8 million of unrecognized share-based compensation expense related to RSUs is expected to be recognized over a weighted-average period of 1.8 years. Performance Share Units The fair value of PSUs granted prior to 2024 was based on the Company's stock price on the grant date. The PSUs granted in 2024 and 2025 (the “2024/2025 PSUs”) include a market condition related to the performance of the Company’s stock price relative to a peer group, or relative total shareholder return (“TSR”) modifier, which can affect the number of shares ultimately issued to grantees at the end of the three-year performance period. The grant date fair value of the 2024/2025 PSUs was determined based on a Monte Carlo valuation model. The total potential payout for the 2024/2025 PSUs is payable upon the achievement of certain established performance targets and can also be impacted by the TSR modifier. The total potential payout for the 2025 PSUs ranges from zero to 750 thousand shares. The weighted-average grant date fair value of PSUs granted during the years ended December 31, 2025, 2024 and 2023 was $46.48, $57.17 and $30.13, respectively. PSUs outstanding as of December 31, 2025 and 2024, and changes during the year ended December 31, 2025, were as follows:
|  | Shares (thousands) |  |  | Weighted-Average Grant Date Fair Value |
Nonvested at December 31, 2024 |  |  | 753 |  |  | $ | 47.20 |
Granted |  |  | 387 |  |  |  | 46.48 |
Vested |  |  | (335 | ) |  |  | 30.84 |
Forfeited |  |  | (20 | ) |  |  | 30.84 |
Nonvested at December 31, 2025 |  |  | 785 |  |  | $ | 54.24 |
During 2025, 387 thousand PSUs were granted to certain executive officers and senior management, 300 thousand of which related to the 2025 performance grant and 87 thousand of which related to additional shares issued during the year ended December 31, 2025 due to the achievement of certain targets for the year ended December 31, 2024.
Year Granted |  | Performance / Service Period |  | Estimated or Actual Attainment |  | PSUs Outstanding as of December 31, 2025 (thousands) |  |  | Estimated PSU Attainment or Actual PSUs Earned (thousands) |
2025 (a) |  | 2025 |  | 61% (c) (f) |  |  | 30 |  |  |  | 18 |
2025 (a) |  | 2026 |  | (d) |  |  | 30 |  |  |  | — |
2025 (a) |  | 2027 |  | (d) |  |  | 30 |  |  |  | — |
2025 (a) |  | 2025-2027 |  | 100% (e) (f) |  |  | 60 |  |  |  | 60 |
2025 (a) |  | 2025-2027 |  | 100% (e) (f) |  |  | 150 |  |  |  | 150 |
|  |  |  |  |  |  | 300 |  |  |  | 228 |
2024 (a) |  | 2024 |  | 66% (c) (f) |  |  | 23 |  |  |  | 15 |
2024 (a) |  | 2025 |  | 0% (c) (f) |  |  | 23 |  |  |  | — |
2024 (a) |  | 2026 |  | (d) |  |  | 23 |  |  |  | — |
2024 (a) |  | 2024-2026 |  | 0% (f) (g) |  |  | 45 |  |  |  | — |
2024 (a) |  | 2024-2026 |  | 200% (f) (g) |  |  | 112 |  |  |  | 224 |
|  |  |  |  |  |  | 226 |  |  |  | 239 |
2023 (b) |  | 2023 |  | 140% (c) |  |  | 66 |  |  |  | 92 |
2023 (b) |  | 2024 |  | 94% (c) |  |  | 64 |  |  |  | 60 |
2023 (b) |  | 2025 |  | 141% (c) |  |  | 64 |  |  |  | 90 |
2023 (b) |  | 2023-2025 |  | 132% (c) |  |  | 65 |  |  |  | 86 |
|  |  |  |  |  |  | 259 |  |  |  | 328 |
(a) The 2024/2025 PSUs contain five performance periods, including three annual performance periods and two three-year cumulative performance periods. (b) The PSU awards granted in 2023 consist of four performance periods, including three annual performance periods and one three-year cumulative performance period. (c) Amounts represent actual attainment and actual PSUs earned as the performance period is complete. (d) As the performance period has not yet commenced, expense is not being recognized. (e) Expense for the cumulative performance/service period is recognized at 100% of the estimated attainment until the attainment expected by the end of the cumulative three-year performance period can be estimated, which generally occurs at the end of the second service year. (f) Attainment percentage does not include the TSR modifier that is determined at the end of the three-year cumulative performance period and applied to PSUs that are earned based on the achievement of the service and performance conditions. (g) Amounts represent estimated attainment and estimated PSUs. As of December 31, 2025, $18.3 million of unrecognized share-based compensation expense related to PSUs is expected to be recognized over a weighted-average period of 1.5 years.

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