0000045919--12-31false2026Q2P1Y

(1) This amount is comprised of the below balances:
Cash and cash equivalents						$	5,185					4,680
Restricted cash						3						$	77
0						$	5,188					$	4,757

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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x			QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2026

or

o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from           to

Commission File Number: 001-07120

HARTE HANKS, INC.

(Exact name of registrant as specified in its charter)

Delaware			1 Executive Drive, Chelmsford, MA 01824			74-1677284
(State or other jurisdiction of			(Address of principal executive offices,			(I.R.S. Employer
incorporation or organization)			including zip code)			Identification Number)

(512) 434-1100

(Registrant’s telephone number including area code)

None

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class			Trading Symbol(s)			Name of each exchange on which registered
Common Stock			HHS			NASDAQ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

o

Accelerated filer

o

Non-accelerated filer

x

Smaller reporting company

x

Emerging growth company

o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark if the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x

The number of shares outstanding of the issuer’s common stock as of July 31, 2026 was 7,454,240 shares.

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Table of Contents

HARTE HANKS, INC. AND SUBSIDIARIES

TABLE OF CONTENTS

FORM 10-Q REPORT

For the Quarterly Period Ended June 30, 2026

PART 1. FINANCIAL INFORMATION			3
Item 1. Condensed Consolidated Financial Statements			3
Condensed Consolidated Balance Sheets			3
Condensed Consolidated Statements of Comprehensive Loss (Unaudited)			4
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited)			5
Condensed Consolidated Statements of Cash Flows (Unaudited)			6
Notes to Condensed Consolidated Financial Statements (Unaudited)			7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			20
Item 3. Quantitative and Qualitative Disclosures About Market Risk			26
Item 4. Controls and Procedures			26
PART II. OTHER INFORMATION			27
Item 1. Legal Proceedings			27
Item 1a. Risk Factors			27
Risks Related to the Proposed Acquisition with Star Equity			27
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			28
Item 3. Defaults Upon Senior Securities			28
Item 4. Mine Safety Disclosures			29
Item 5. Other Information			29
Item 6. Exhibits			29

            

2

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Table of Contents

PART 1. FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

Harte Hanks, Inc. and Subsidiaries Condensed Consolidated Balance Sheets

In thousands, except shares and per share amounts						June 30, 2026						December 31, 2025
ASSETS						(unaudited)
Current assets
Cash and cash equivalents and restricted cash						$	5,188					$	5,587
Accounts receivable (less allowance for doubtful accounts of $169 and $22 at June 30, 2026 and December 31, 2025, respectively)						27,431						27,841
Unbilled accounts receivable and contract assets						7,971						7,049
Prepaid expenses						1,537						2,363
Prepaid income taxes and income tax receivable						1,431						1,431
Other current assets						1,798						2,046
Total current assets						45,356						46,317
Property, plant and equipment, net						6,866						8,386
Operating and Financing lease right-of-use assets						18,597						19,854
Other assets
Intangible assets, net						273						370
Goodwill						295						295
Deferred tax assets, net						15,982						16,040
Other long-term assets						690						564
Total other assets						17,240						17,269
Total assets						$	88,059					$	91,826
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable						$	13,238					$	13,096
Accrued expenses						6,561						5,915
Accrued payroll and related expenses						3,165						2,749
Short-term debt						3,000						—
Deferred revenue and customer advances						2,552						813
Customer postage and program deposits						693						868
Other current liabilities						1,659						3,180
Current portion of lease liabilities						4,003						3,543
Total current liabilities						34,871						30,164
Pension liabilities - Qualified plans						3,390						4,106
Pension liabilities - Nonqualified plan						16,525						16,995
Long-term lease liabilities, net of current portion						17,035						18,861
Other long-term liabilities						888						1,174
Total liabilities						72,709						71,300
Stockholders’ equity
Common stock, $1 par value, 25,000,000 shares authorized; 12,221,484 shares issued, 7,454,240 and 7,414,794 shares outstanding at June 30, 2026 and December 31, 2025, respectively						12,221						12,221
Additional paid-in capital						99,393						109,558
Retained earnings						808,181						813,812
Less treasury stock, 4,767,244 shares at cost at June 30, 2026 and 4,806,690 shares at cost at December 31, 2025						(889,526)						(900,085)
Accumulated other comprehensive loss						(14,919)						(14,980)
Total stockholders’ equity						15,350						20,526
Total liabilities and stockholders’ equity						$	88,059					$	91,826
See Accompanying Notes to Condensed Consolidated Financial Statements

3

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Table of Contents

Harte Hanks, Inc. and Subsidiaries Condensed Consolidated Statements of Comprehensive Loss (Unaudited)

			Three months ended June 30,												Six months ended June 30,
In thousands, except per share amounts			2026						2025						2026						2025
Revenue			$	37,984					$	38,631					$	75,248					$	80,192
Operating expenses
Labor			19,898						19,445						39,708						39,244
Production and distribution			12,482						12,400						23,821						26,457
Advertising, selling, general and administrative			8,785						5,538						14,426						11,382
Restructuring expenses			187						149						347						987
Depreciation and amortization expense			1,122						1,065						2,204						2,128
Total operating expenses			42,474						38,597						80,506						80,198
Operating (loss) income			(4,490)						34						(5,258)						(6)
Other expenses, net
Interest expense, net			90						61						159						114
Other expenses, net			303						386						464						900
Total other expenses, net			393						447						623						1,014
Loss before income taxes			(4,883)						(413)						(5,881)						(1,020)
Income tax provision (benefit)			120						(78)						(250)						(293)
Net loss			(5,003)						(335)						(5,631)						(727)
Loss per common share
Basic and diluted			$	(0.67)					$	(0.05)					$	(0.76)					$	(0.10)
Weighted average shares used to compute loss per share
Basic and diluted			7,431						7,382						7,423						7,371
Comprehensive loss, net of tax:
Net loss			$	(5,003)					$	(335)					$	(5,631)					$	(727)
Adjustment to pension liability, net			307						44						380						209
Foreign currency translation adjustment			(242)						73						(319)						109
Total other comprehensive income, net of tax			$	65					$	117					$	61					$	318
Comprehensive loss			$	(4,938)					$	(218)					$	(5,570)					$	(409)

See Accompanying Notes to Condensed Consolidated Financial Statements

4

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Table of Contents

Harte Hanks, Inc. and Subsidiaries Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited)

In thousands						Common Stock						Additional Paid-in Capital						Retained Earnings						Treasury Stock						Accumulated Other Comprehensive Loss						Total Stockholders’ Equity
Balance at December 31, 2025						$	12,221					$	109,558					$	813,812					$	(900,085)					$	(14,980)					$	20,526
Stock-based compensation						—						218						—						—						—						218
Vesting of RSUs						—						(1,560)						—						1,551						—						(9)
Net loss						—						—						(628)						—						—						(628)
Other comprehensive loss						—						—						—						—						(4)						(4)
Balance at March 31, 2026						$	12,221					$	108,216					$	813,184					$	(898,534)					$	(14,984)					$	20,103
Stock-based compensation						—						221						—						—						—						221
Vesting of RSUs						—						(9,044)						—						9,008						—						(36)
Net loss						—						—						(5,003)						—						—						(5,003)
Other comprehensive income						—						—						—						—						65						65
Balance at June 30, 2026						$	12,221					$	99,393					$	808,181					$	(889,526)					$	(14,919)					$	15,350

In thousands						Common Stock						Additional Paid-in Capital						Retained Earnings						Treasury Stock						Accumulated Other Comprehensive Loss						Total Stockholders’ Equity
Balance at December 31, 2024						$	12,221					$	124,194					$	814,623					$	(915,752)					$	(13,597)					$	21,689
Stock-based compensation						—						(49)						—						—						—						(49)
Vesting of RSUs						—						(2,353)						—						2,325						—						(28)
Net loss						—						—						(392)						—						—						(392)
Other comprehensive income						—						—						—						—						201						201
Balance at March 31, 2025						$	12,221					$	121,792					$	814,231					$	(913,427)					$	(13,396)					$	21,421
Stock-based compensation						—						220						—						—						—						220
Vesting of RSUs						—						(11,006)						—						10,985						—						(21)
Recovery of short swing profits, net of tax						—						838						—						—						—						838
Net loss						—						—						(335)						—						—						(335)
Other comprehensive income						—						—						—						—						117						117
Balance at June 30, 2025						$	12,221					$	111,844					$	813,896					$	(902,442)					$	(13,279)					$	22,240

See Accompanying Notes to Condensed Consolidated Financial Statements

5

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Table of Contents

Harte Hanks, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (Unaudited)

						Six Months Ended June 30,
In thousands						2026						2025
Cash Flows from Operating Activities
Net loss						$	(5,631)					$	(727)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense						2,204						2,128
Stock-based compensation						439						171
Net pension (payment) cost						(957)						(1,079)
Deferred income taxes						(58)						(51)
Changes in assets and liabilities:
Accounts receivable and contract assets						(512)						(769)
Prepaid expenses, income tax receivable and other current assets						1,007						(536)
Accounts payable and accrued expenses						757						(3,623)
Deferred revenue and customer advances						1,739						222
Customer postage and program deposits						(175)						(184)
Other accrued expenses and liabilities						(1,460)						(1,220)
Net cash used in operating activities						(2,647)						(5,668)
Cash Flows from Investing Activities
Purchases of property, plant and equipment						(306)						(328)
Net cash used in investing activities						(306)						(328)
Cash Flows from Financing Activities
Borrowings						3,000						—
Payment of finance leases						(82)						(79)
Recovery of short-swing profit from stockholders						—						838
Treasury stock activities						(45)						(49)
Net cash provided by financing activities						2,873						710
Effect of exchange rate changes on cash, cash equivalents and restricted cash						(319)						109
Net decrease in cash and cash equivalents and restricted cash						(399)						(5,177)
Cash and cash equivalents and restricted cash at beginning of period						5,587						9,934
Cash and cash equivalents and restricted cash at end of period						$	5,188		(1)			$	4,757
Supplemental disclosures
Cash paid for interest						$	123					$	110
Cash received for interest						$	(2)					$	(28)
Cash paid for income taxes, net						$	1,050					$	1,186
Non-cash investing and financing activities
Purchases of property, plant and equipment included in accounts payable						$	625					$	647
(1) This amount is comprised of the below balances:
Cash and cash equivalents						$	5,185					4,680
Restricted cash						3						$	77
						$	5,188					$	4,757

See Accompanying Notes to Condensed Consolidated Financial Statements

6

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Table of Contents

Harte Hanks, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

Note A - Overview and Significant Accounting Policies

Background

Harte Hanks, Inc. together with its wholly-owned subsidiaries (“Harte Hanks,” “Company,” “we,” “our,” or “us”) is a leading global customer experience company. With offices in North America, Asia-Pacific and Europe, Harte Hanks works with some of the world’s most respected brands.

Segment Reporting

The Company operates three reportable segments: Revenue Solutions; Customer Care; and Fulfillment & Logistics Services. Our President is considered to be our chief operating decision maker (CODM). Our President reviews our operating results on an aggregate basis for purposes of allocating resources and evaluating financial performance by using the three financial measures: revenue, operating income and operating income plus depreciation and amortization (EBITDA).

Accounting Principles

Our unaudited interim condensed consolidated financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In the opinion of management, the unaudited interim condensed consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods presented. Interim results are not necessarily indicative of results for a full year. The information included in this Form 10-Q should be read in conjunction with information included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the “2025 10-K”).

Consolidation

The accompanying unaudited interim condensed consolidated financial statements include the accounts of Harte Hanks, Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. As used in this report, the terms “Harte Hanks,” “the Company,” “we,” “us,” or “our” may refer to Harte Hanks, Inc., one or more of its consolidated subsidiaries, or all of them taken as a whole, as the context may require.

Interim Financial Information

The condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Rule 8-01 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included.

Use of Estimates

Preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from those estimates due to uncertainties. Such estimates include, but are not limited to, estimates related to revenue recognition; income taxes; goodwill and intangible assets impairment as well as pension accounting. On an ongoing basis, management reviews its estimates and assumptions based on currently available information. Changes in facts and circumstances could result in revised estimates and assumptions.

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Operating Expense Presentation in Condensed Consolidated Statements of Comprehensive Loss

The “Labor” line in the Condensed Consolidated Statements of Comprehensive Loss includes all employee payroll and benefits costs, including stock-based compensation and temporary labor costs. The “Production and distribution” and “Advertising, selling, general and administrative” lines do not include any labor, depreciation, or amortization expense. Certain labor costs are included in restructuring expense, please see Note M - Restructuring Activities for details.

Revenue Recognition

We recognize revenue upon the transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to be entitled to receive in exchange for those products or services based on the relevant contract. We apply the following five-step revenue recognition model:

•Identification of the contract, or contracts, with a customer

•Identification of the performance obligations in the contract

•Determination of the transaction price

•Allocation of the transaction price to the performance obligations in the contract

•Recognition of revenue when (or as) we satisfy the performance obligation

Certain client programs provide for adjustments to billings based upon whether we achieve certain performance criteria. In these circumstances, revenue is recognized when the foregoing conditions are met. We record revenue net of any taxes collected from customers and subsequently remitted to governmental authorities. Any payments received in advance of the performance of services or delivery of the product are recorded as deferred revenue until such time as the services are performed or the product is delivered. Costs incurred for search engine marketing solutions payable to the engine host and postage costs of mailings are billed to our clients and are not directly reflected in our revenue.

Revenue from agency and digital services, direct mail, logistics, fulfillment and contact center is recognized when the work is performed. Fees for these services are determined by the terms set forth in each contract. These fees are typically a set fixed price or rate by transaction occurrence, service provided, time spent, or product delivered.

For arrangements requiring design and build of a database, revenue is not recognized until client acceptance occurs. Up-front fees billed during the setup phase for these arrangements are deferred and direct build costs are capitalized. Pricing for these types of arrangements is typically based on a fixed price determined in the contract. Revenue from other database marketing solutions is recognized ratably over the contractual service period. Pricing for these services is typically based on a fixed price per month or per contract.

Fair Value of Financial Instruments

Financial Accounting Standards Board ("FASB") Accounting Standard Codification ("ASC") 820, Fair Value Measurements and Disclosures, (“ASC 820”) defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 also establishes a fair value hierarchy that prioritizes the inputs used in valuation methodologies into three levels:

Level 1			Quoted prices in active markets for identical assets or liabilities.
Level 2			Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3			Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Because of their maturities and/or variable interest rates, certain financial instruments have fair values approximating their carrying values. These instruments include cash and cash equivalents and restricted cash, accounts receivable, trade payables, and debt. The fair value of the assets in our funded pension plan is discussed in Note H, Employee Benefit Plans.

Leases

We determine if an arrangement is a lease at its inception. Operating and finance leases are included in the lease right-of-use (“ROU”) assets and in the current portion and long-term portion of lease liabilities on our condensed consolidated balance sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date of each lease based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit interest rate, we use our incremental borrowing rate based on the information available at

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the commencement date of each lease to determine the present value of lease payments. The operating lease ROU assets also include any lease payments made and exclude lease incentives. Our lease terms may include options to extend or terminate the lease, which are included in the lease ROU assets when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are generally accounted for separately. For certain real estate leases, we account for the lease and non-lease components as a single lease component.

Note B - Recent Accounting Pronouncements

Recent Accounting Guidance Adopted

In July 2025, the Financial Accounting Standards Board (“FASB”) issued ASU 2025-05, which amends ASC 326-20 to provide a practical expedient (for all entities) relating to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606. ASU 2025-05 is effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with early adoption permitted. The Company adopted ASU 2025-05 effective January 1, 2026. The adoption did not have a material impact on the Company’s Consolidated condensed financial statements.

Recent Accounting Guidance Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses (Subtopic 220-40). The ASU requires entities to disclose the disaggregated information for specific expense categories, including purchases of inventory, employee compensation, depreciation, and amortization, within the relevant income statement captions. This ASU also requires disclosure of the total amount of selling expenses along with the definition of what constitutes selling expenses. The ASU is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Adoption of this ASU can either be applied prospectively to consolidated financial statements issued for reporting periods after the effective date of this ASU or retrospectively to any or all prior periods presented in the consolidated financial statements. Early adoption is also permitted. This ASU will likely result in the required additional disclosures being included in our consolidated financial statements, once adopted. We are currently evaluating the provisions of this ASU.

In September 2025, the FASB issued ASU 2025-06 to target improvements to the Accounting for Internal-Use Software, which simplifies the capitalization guidance by removing all references to software development project stages and clarifies the criteria to begin capitalizing cost. The amendment is effective for annual and interim periods beginning after December 15, 2027, though early adoption is permitted. The Company is currently evaluating the impact of this amendment on its Consolidated Financial Statements.

In December 2025, the FASB issued ASU 2025-11 to improve the guidance in Topic 270, Interim Reporting, by improving the navigability of the required interim disclosures and clarifying when that guidance is applicable. The amendment is effective for interim periods with annual reporting periods beginning after December 15, 2027, though early adoption is permitted. The Company is currently evaluating the impact of this amendment on its Condensed Consolidated Financial Statements.

No other new accounting pronouncements recently adopted or issued had or are expected to have a material impact on the condensed consolidated financial statements.

Note C - Revenue from Contracts with Customers

Our contracts with customers state the terms of sale, including the description, quantity, and price of the product sold or service provided. Payment terms can vary by contract, but the period between invoicing and when payment is due is not significant. The Company's contracts with its customers generally do not include rights of return or a significant financing component.

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Disaggregation of Revenue

We disaggregate revenue by three key revenue streams which are aligned with our reportable segments. The nature of the services offered by each key revenue stream is different. The following table summarizes revenue from contracts with customers for the three and six months ended June 30, 2026 and 2025 by our three reportable segments:

						Three months ended June 30,												Six months ended June 30,
In thousands						2026						2025						2026						2025
Revenue Solutions						$	7,521					$	8,662					$	15,437					$	17,443
Customer Care						12,853						11,845						25,710						24,847
Fulfillment & Logistics Services						17,610						18,124						34,101						37,902
Total Revenues						$	37,984					$	38,631					$	75,248					$	80,192

During the three and six months ended June 30, 2026, the Company recognized revenue of $0.8 million and $1.0 million, respectively, and during the three and six months ended June 30, 2025, the Company recognized revenue of $1.6 million and $1.7 million, respectively, from performance obligations satisfied at a point in time. The remaining revenue recognized in both 2026 and 2025 was recognized in an over time pattern. Our contracts with customers may consist of multiple performance obligations. If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price (“SSP”) basis unless the transaction price is variable and meets the criteria to be allocated entirely to a performance obligation or to a distinct good or service that forms part of a single performance obligation. For most performance obligations, we determine SSP based on the price at which the performance obligation is sold separately. Although uncommon, if the SSP is not observable through past transactions, we estimate the SSP taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations. Further discussion of other performance obligations in each of our major revenue streams follows:

Revenue Solutions

Our Revenue Solutions segment delivers strategic planning, data strategy, performance analytics, creative development and execution, technology enablement, marketing automation, and database management. The customer can choose other services to supplement and support their own in-house sales team. These services may range from leveraging data for lead generation, and outsourcing the design and testing of sales play, to full hiring and managing of a dedicated internal sales team.

Most revenue solutions performance obligations are satisfied over time and often offered on a per project basis. We have concluded that the best approach to measure the progress toward completion of the project-based performance obligations is the input method, which is based on either the costs or labor hours incurred to date depending upon whether costs or labor hours more accurately depict the transfer of value to the customer.

Our database solutions are built around centralized marketing databases with services rendered to build custom database, database hosting services, customer or target marketing lists and data processing services.

These performance obligations, including services rendered to build a custom database, database hosting services, customer or target marketing lists and data processing services, may be satisfied over time or at a point in time. We provide software as a service (“SaaS”) solutions to host data for customers and have concluded that these solutions are stand-ready obligations to be recognized over time on a monthly basis. Our promise to provide certain data related services meets the over-time recognition criteria because our services do not create an asset with an alternative use, and we have an enforceable right to payment. For performance obligations recognized over time, we choose either the input (i.e., labor hour) or output method (i.e., number of customer records) to measure the progress toward completion depending on the nature of the services provided. Some of our other data-related services do not meet the over-time criteria and are therefore, recognized at a point-in-time, typically upon the delivery of a specific deliverable.

Our contracts may include outsourced print production work for our clients. These contracts may include a promise to purchase postage on behalf of our clients. In such cases, we have determined we are an agent, rather than principal and therefore recognize net consideration as revenue.

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Customer Care

We deliver customer care services in the United States, Asia, and Europe to provide advanced solutions such as voice, SMS/chat, email, integrated voice response, web self-service, social cloud monitoring, and analytics.

Performance obligations are stand-ready obligations and are satisfied over time. With regard to account management and SaaS, we use a time-elapsed output method to recognize revenue. For performance obligations where we charge customers a transaction-based fee, we use the output method based on transaction quantities. In most cases, our contracts provide us the right to invoice for services provided, therefore, we generally use the “as invoiced” practical expedient to recognize revenue associated with these performance obligations unless significant discounts are offered in a contract and prices for services do not represent their SSPs.

Fulfillment & Logistics Services

Our services, delivered internally and with our partners, include: printing, lettershop, advanced mail optimization (including commingling services), logistics and transportation optimization, monitoring and tracking, to support traditional and specialized mailings. Our print and fulfillment centers in Massachusetts and Kansas provide custom kitting services, print on demand, product recalls, trade marketing fulfillment, ecommerce product fulfillment, sampling programs, and freight optimization, thereby allowing our customers to distribute literature and other marketing materials.

Performance obligations offered within this revenue stream may be satisfied either over time or at a point time. Over time performance obligations utilize either the input or output method, depending on the nature of the service, to measure progress toward satisfying the performance obligation. For performance obligations where we charge customers a transaction-based fee, we utilize the output method based on the quantities fulfilled. Services provided through our fulfillment centers are typically priced at a per transaction basis and our contracts provide us the right to invoice for services provided and reflects the value to the customer of the services transferred to date. In most cases, we use the “as invoiced” practical expedient to recognize revenue associated with these performance obligations unless significant discounts are offered in a contract and prices for services do not represent their standalone selling prices. Our direct mail business contracts may have included a promise to purchase postage on behalf of our clients; in such cases, we have determined we are an agent, rather than principal and therefore recognize net consideration as revenue.

Transaction Price Allocated to Future Performance Obligations

We have elected to apply certain optional exemptions that limit the disclosure requirements over remaining performance obligations at period end to exclude the performance obligations that have an original expected duration of one year or less, transactions using the “as invoiced” practical expedient, or when a performance obligation is a series and we have allocated the variable consideration directly to the services performed. As of June 30, 2026, we had no transaction prices allocated to unsatisfied or partially satisfied performance obligations.

Contract Balances

We record an unbilled receivable when revenue is recognized prior to invoicing when we have an unconditional right to consideration (only the passage of time is required before payment of that consideration is due) and a contract asset when the right to payment is conditional upon our future performance such as delivery of an additional good or service (e.g. customer contract requires customer’s final acceptance of custom database solution or delivery of a final marketing strategy delivery presentation before customer payment is required). If invoicing occurs prior to revenue recognition, the unearned revenue is presented on our Condensed Consolidated Balance Sheet as a contract liability, referred to as deferred revenue.

The following table summarizes our contract balances as of June 30, 2026 and December 31, 2025:

In thousands						June 30, 2026						December 31, 2025
Unbilled accounts receivable						7,823						6,728
Contract assets						148						321
Deferred revenue and customer advances						2,552						813

Revenue recognized during the six months ended June 30, 2026 from amounts included in deferred revenue at the beginning of the period was approximately $0.8 million. Revenue recognized during the six months ended June 30, 2025 from amounts included in deferred revenue at the beginning of the period was approximately $1.0 million.

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Costs to Obtain and Fulfill a Contract

We recognize an asset for the direct costs incurred to obtain and fulfill our contracts with customers to the extent that we expect to recover these costs and if the benefit is longer than one year. These costs are amortized to expense over the expected period of the benefit in a manner that is consistent with the transfer of the related goods or services to which the asset relates. We impair the asset when recoverability is not anticipated. We capitalized a portion of commission expense, implementation and other costs that represent the cost to obtain a contract. The remaining unamortized contract costs were $0.3 million and $0.3 million as of June 30, 2026 and December 31, 2025, respectively. They are included in other current assets and other assets on our balance sheet. For the periods presented, no impairment was recognized.

Note D - Leases

We have operating and finance leases for corporate and business offices, service facilities, call centers and certain equipment. Leases with an initial term of 12 months or less are generally not recorded on the balance sheet, unless the arrangement includes an option to purchase the underlying asset, or an option to renew the arrangement, that we are reasonably certain to exercise (short-term lease). Our leases have remaining lease terms of one to seven years, some of which may include options to extend the leases for up to an additional five years.

As of June 30, 2026, assets recorded under finance and operating leases were approximately $0.5 million and $18.1 million, respectively, and accumulated amortization associated with finance leases was $0.3 million. As of December 31, 2025, assets recorded under finance and operating leases were approximately $0.6 million and $19.2 million, respectively, and accumulated amortization associated with finance leases was $0.3 million. Operating lease right of use assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The discount rate used to determine the commencement date present value of lease payment is the interest rate implicit in the lease, or when that is not readily determinable, we utilize our incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term at an amount equal to the lease payments in a similar economic environment. Certain adjustments to the right-of-use asset may be required for items such as initial direct costs paid or incentives received.

There was no impairment of leases during the three and six months ended June 30, 2026 and 2025.

The following table presents supplemental balance sheet information related to our financing and operating leases:

In thousands						As of June 30, 2026																		As of December 31, 2025
						Operating Leases						Finance Leases						Total						Operating Leases						Finance Leases						Total
Right-of-use Assets						$	18,078					$	519					$	18,597					$	19,247					$	607					$	19,854
Liabilities
Current portion of lease liabilities						3,831						172						4,003						3,376						167						3,543
Long-term lease liabilities						16,646						389						17,035						18,400						461						18,861
Total Lease Liabilities						$	20,477					$	561					$	21,038					$	21,776					$	628					$	22,404

For the three and six months ended June 30, 2026 and 2025, the components of lease expense were as follows:

						Three months ended June 30,												Six months ended June 30,
In thousands						2026						2025						2026						2025
Operating lease cost						$	1,167					$	1,259					$	2,340					$	2,524
Finance lease cost:
Amortization of right-of-use assets						43						43						86						88
Interest on lease liabilities						11						14						23						29
Total Finance lease cost						54						57						109						117
Variable lease cost						321						369						651						776
Total lease cost, net						$	1,542					$	1,685					$	3,100					$	3,417

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Other information related to leases was as follows:

In thousands						Six Months Ended June 30, 2026						Six Months Ended June 30, 2025
Supplemental Cash Flows Information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases						$	2,457					$	2,645
Operating cash flows from finance leases						21						27
Financing cash flows from finance leases						82						79
Weighted Average Remaining Lease term in years
Operating leases						5.0						5.9
Finance leases						3.1						4.1
Weighted Average Discount Rate
Operating leases						5.93		%				5.76		%
Finance leases						7.75		%				7.77		%

The maturities of the Company’s finance and operating lease liabilities as of June 30, 2026 are as follows:

In thousands						Operating Leases						Finance Leases
Year Ending December 31,
Remainder of 2026						$	2,411					$	103
2027						4,714						206
2028						4,537						206
2029						4,579						114
2030						4,485						—
2031 and beyond						3,116						—
Total future minimum lease payments						23,842						629
Less: imputed interest						3,365						68
Total lease liabilities						$	20,477					$	561

Note E - Share Repurchase Program

On May 2, 2023, the Board of Directors of Harte Hanks approved a share repurchase program to maximize shareholder value with authorization to repurchase $6.5 million of the Company’s Common Stock. As of December 31, 2025, the share repurchase program authorization availability was $4.1 million. In the three and six months ended June 30, 2026 and 2025, we did not repurchase any shares of common stock.

Note F — Debt - Credit Facility

On December 21, 2021, the Company entered into a three-year, $25.0 million asset-based revolving credit facility (the "Credit Facility") with Texas Capital Bank ("TCB"). The Company’s obligations under the Credit Facility are guaranteed on a joint and several basis by the Company’s material subsidiaries (the “Guarantors”). The Credit Facility is secured by substantially all of the assets of the Company and the Guarantors pursuant to a Pledge and Security Agreement, dated as of December 21, 2021, among the Company, TCB and the other Guarantors party thereto (the "Security Agreement"). On June 24, 2025, the Company entered into a second amendment to the Credit Facility (the “Second Amendment”) with TCB which extended the maturity date for the Credit Facility by a period of three years to June 30, 2028. The Second Amendment also includes an accordion feature that allows the Company to seek up to a $10.0 million increase in commitments under the credit line, subject to TCB approval.

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The Credit Facility provides for loans up to the lesser of (a) $25.0 million, and (b) the amount available under a “borrowing base” calculated primarily by reference to the Company's cash and cash equivalents and accounts receivable. The Credit Facility allows the Company to use up to $3.0 million of its borrowing capacity to issue letters of credit.

The loans under the Credit Facility accrue interest at a variable rate equal to the Secured Overnight Financing Rate (SOFR) plus a margin of 2.25% per annum. The interest rate was 5.99% as of June 30, 2026. The outstanding amounts advanced under the Credit Facility are due and payable in full on June 30, 2028. As of June 30, 2026 and December 31, 2025, we had letters of credit outstanding in the amount of $0.7 million. No amounts were drawn against these letters of credit at June 30, 2026. These letters of credit exist to support insurance programs relating to worker’s compensation and general liability as well as lease obligations. Unused commitment balances accrue fees at a rate of 0.25%.

As of June 30, 2026 and December 31, 2025, we had $3.0 million and no borrowings outstanding under the Credit Facility, respectively. We had the ability to borrow $21.3 million and $24.3 million on June 30, 2026 and December 31, 2025, respectively, under the Credit Facility.

Note G — Stock-Based Compensation

We maintain stock incentive plans for the benefit of certain officers, directors, and employees. Our stock incentive plans provide for the ability to issue stock options, cash stock appreciation rights, performance stock units, phantom stock units and cash performance stock units. Our cash stock appreciation rights, phantom stock units and cash performance stock units settle solely in cash and are treated as the current liability, which are adjusted each reporting period based on changes in our stock price.

Compensation expense for stock-based awards is based on the fair values of the awards on the date of grant and is recognized on a straight-line basis over the vesting period of the entire award in the “Labor” line of the Condensed Consolidated Statements of Comprehensive Loss. We recognized $0.2 million and $0.2 million of stock-based compensation expense during the three months ended June 30, 2026 and 2025, respectively. We recognized $0.4 million and $0.2 million of stock-based compensation expense during the six months ended June 30, 2026 and 2025, respectively.

Note H — Employee Benefit Plans

Prior to January 1, 1999, we provided a defined benefit pension plan for which most of our employees were eligible to participate (the “Qualified Pension Plan”). In conjunction with significant enhancements to our 401(k) plan, we elected to freeze benefits under the Qualified Pension Plan as of December 31, 1998.

In 1994, we adopted a non-qualified, unfunded, supplemental pension plan (the “Restoration Pension Plan”) covering certain employees, which provides for incremental pension payments so that total pension payments equal those amounts that would have been payable from the principal pension plan were it not for limitations imposed by income tax regulation. The benefits under the Restoration Pension Plan were intended to provide benefits equivalent to our Qualified Pension Plan as if such plan had not been frozen. We elected to freeze benefits under the Restoration Pension Plan as of April 1, 2014.

At the end of 2020, the Board of Directors of the Company approved the division of the Qualified Pension Plan into two distinct plans, “Qualified Pension Plan I” and “Qualified Pension Plan II.” The assets and liabilities of the Qualified Pension Plan that were attributable to certain participants in Qualified Pension Plan II were spun off and transferred into Qualified Pension Plan II effective as of the end of December 31, 2021, in accordance with Internal Revenue Code section 414(I) and ERISA Section 4044. In 2024, Qualified Pension Plan I was terminated with the transfer of our obligations under this pension plan to a third-party provider.

The overfunded or underfunded status of our defined benefit post-retirement plans is recorded as an asset or liability on our condensed consolidated balance sheets. The funded status is measured as the difference between the fair value of plan assets and the projected benefit obligation. Periodic changes in the funded status are recognized through other comprehensive income in the Condensed Consolidated Statements of Comprehensive Loss. We currently measure the funded status of our defined benefit plans as of December 31, the date of our year-end Consolidated Balance Sheets.

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Net pension cost for both plans included the following components:

						Three Months Ended June 30,												Six Months Ended June 30,
In thousands						2026						2025						2026						2025
Interest cost						$	681					$	776					$	1,420					$	1,478
Expected return on plan assets						(490)						(604)						(1,027)						(1,074)
Recognized actuarial loss						129						61						228						198
Net periodic benefit cost						$	320					$	233					$	621					$	602

Based on current estimates, we will be required to make a $1.7 million contribution to the Qualified Pension Plan in 2026. We made $0.6 million of such $1.7 million aggregate contribution in the six months ended June 30, 2026.

We are not required to make, and do not intend to make, any contributions to our Restoration Pension Plan in 2026 other than to the extent needed to cover benefit payments. We made benefit payments under this supplemental plan of $0.9 million in both the six months ended June 30, 2026 and 2025.

Note I - Income Taxes

The income tax expense was $0.1 million and income tax benefit was $0.1 million for the three months ended June 30, 2026 and 2025, respectively. The provision for income taxes resulted in a negative effective tax rate of 2.5% for the three months ended June 30, 2026 and a positive 18.9% for the three months ended June 30, 2025. The effective income tax rate for the three months ended June 30, 2026 and 2025 differs from the federal statutory rate of 21%, primarily due to the U.S. state income taxes and the impact of income earned in foreign jurisdictions.

The income tax benefit was $0.3 million and $0.3 million for the six months ended June 30, 2026 and 2025, respectively. The provision for income taxes resulted in a positive effective tax rate of 4.3% for the six months ended June 30, 2026 and a positive 28.7% for the six months ended June 30, 2025. The effective income tax rate for the six months ended June 30, 2026 and 2025 differs from the federal statutory rate of 21%, primarily due to the U.S. state income taxes and the impact of income earned in foreign jurisdictions.

Harte Hanks, or one of our subsidiaries file income tax returns in the U.S. federal, U.S. state, and foreign jurisdictions. For U.S. state, federal and foreign returns, we are no longer subject to tax examinations for years prior to 2020. The Company has reviewed all of its tax positions in order to determine whether all, a portion, or none of any related tax benefit should be recognized and has not identified or recorded any ASC 740-10 reserve.

We have elected to classify any interest expense and penalties related to income taxes within income tax expense in our Condensed Consolidated Statements of Comprehensive Loss. We did not have a significant amount of interest or penalties accrued at June 30, 2026 or December 31, 2025.

Note J - Loss Per Share

Basic income (loss) per share (“EPS”) is calculated using income (loss) available to common stockholders, divided by the weighted average number of shares outstanding during the period. Diluted earnings per share is calculated using income available to common stockholders divided by the weighted average number of shares of common stock including both shares outstanding and shares potentially issuable in connection with restricted common stock awards and stock options under our stock incentive plans.

Reconciliations of basic and diluted EPS were as follows:

						Three months ended June 30,												Six months ended June 30,
In thousands, except per share amounts						2026						2025						2026						2025
Numerator:
Net loss						$	(5,003)					$	(335)					$	(5,631)					$	(727)
Denominator:
Basic and diluted EPS denominator: weighted-average common shares outstanding						7,431						7,382						7,423						7,371
Basic and diluted loss per Common Share						$	(0.67)					$	(0.05)					$	(0.76)					$	(0.10)

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For the three months ended June 30, 2026 and 2025, respectively, the following shares have been excluded from the calculation of shares used in the diluted EPS calculation: 166,602 and 186,734 shares of anti-dilutive market price options; 137,931 and 79,178 of anti-dilutive unvested restricted shares.

For the six months ended June 30, 2026 and 2025, respectively, the following shares have been excluded from the calculation of shares used in the diluted EPS calculation: 166,602 and 223,675 shares of anti-dilutive market price options; 148,445 and 33,496 of anti-dilutive unvested restricted shares.

Note K — Comprehensive Income (Loss)

Comprehensive income (loss) for a period encompasses net income (loss) and all other changes in equity other than from transactions with our stockholders.

Changes in accumulated other comprehensive loss by component were as follows:

In thousands						Defined Benefit Pension Items						Foreign Currency Items						Total
Balance at December 31, 2025						$	(11,197)					$	(3,783)					$	(14,980)
Other comprehensive loss, net of tax, before reclassifications						—						(319)						(319)
Amounts reclassified from accumulated other comprehensive loss, net of tax, to other, net, on the condensed consolidated statements of comprehensive loss						380						—						380
Net current period other comprehensive income (loss), net of tax						380						(319)						61
Balance at June 30, 2026						$	(10,817)					$	(4,102)					$	(14,919)

In thousands						Defined Benefit Pension Items						Foreign Currency Items						Total
Balance at December 31, 2024						$	(10,183)					$	(3,414)					$	(13,597)
Other comprehensive income, net of tax, before reclassifications						—						109						109
Amounts reclassified from accumulated other comprehensive income, net of tax, to other, net, on the condensed consolidated statements of comprehensive loss						209						—						209
Net current period other comprehensive income, net of tax						209						109						318
Balance at June 30, 2025						$	(9,974)					$	(3,305)					$	(13,279)

Reclassification amounts related to the defined pension plans are included in the computation of net periodic pension benefit cost (see Note H, Employee Benefit Plans).

Note L — Litigation and Contingencies

In the normal course of our business, we are obligated under some agreements to indemnify our clients as a result of third party claims that we infringe on the proprietary rights of third parties, or third party claims relating to other ad hoc contract obligations. The terms and duration of these commitments vary and, in some cases, may be indefinite, and some of these contractual commitments do not limit the maximum amount of future payments we could become obligated to make thereunder; accordingly, our actual aggregate maximum exposure related to these types of commitments is not reasonably estimable. Historically, we have not been obligated to make significant payments for obligations of this nature, and no liabilities have been recorded for these obligations in our consolidated financial statements.

We are also subject to various claims and legal proceedings in the ordinary course of conducting our businesses and, from time to time, we may become involved in additional claims and lawsuits incidental to our businesses. We routinely assess the likelihood of adverse judgments or outcomes to these matters, as well as ranges of probable losses; to the extent losses are reasonably estimable. Accruals are recorded for these matters to the extent that management concludes a loss is probable and the financial impact, should an adverse outcome occur, is reasonably estimable.

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In the opinion of management, appropriate and adequate accruals for legal matters have been made, and management believes that the probability of a material loss beyond the amounts accrued is remote. Nevertheless, we cannot predict the impact of future developments affecting our pending or future claims and lawsuits. We expense legal costs as incurred, and all recorded legal liabilities are adjusted as required as better information becomes available to us. The factors we consider when recording an accrual for contingencies include, among others: (i) the opinions and views of our general counsel and outside legal counsel; (ii) our previous experience with similar claims; and (iii) the decision of our management as to how we intend to respond to the complaints.

Note M — Restructuring Activities

During the second half of 2023, we engaged a consulting firm to help review and analyze the structure and operations of the Company. The program named "Project Elevate" involved the optimization and rationalization of our business resources as well as the partial reinvestment of savings into the Company's sales and marketing team, technology, and strategy. Reorganization cost reductions from Project Elevate during 2024 through 2026 are estimated to be $16.0 million. We incurred total restructuring charges of $10.2 million through June 30, 2026.

For the three months ended June 30, 2026 and 2025, we recorded restructuring charges of $0.2 million and $0.1 million, respectively. For six months ended June 30, 2026 and 2025, we recorded restructuring charges of $0.3 million and $1.0 million, respectively.

The following table summarizes the restructuring charges which are recorded in “Restructuring Expense” in the Condensed Consolidated Statement of Comprehensive Loss.

						Three months ended June 30,												Six months ended June 30,
In thousands						2026						2025						2026						2025
Consulting and employee expense						$	45					$	45					$	113					$	93
Severance						142						99						234						790
Facility and other expenses						—						5						—						104
Total						$	187					$	149					$	347					$	987

The following table summarizes the changes in liabilities related to restructuring activities, these liabilities are included in the Accrued expenses line in our Condensed Consolidated Balance Sheet:

						Six months ended June 30, 2026
In thousands						Consulting and Employee Expense						Severance						Total
Beginning balance:						$	—					$	328					$	328
Additions						113						234						347
Payments and adjustment						(113)						(355)						(468)
Ending balance:						$	—					$	207					$	207

Note N — Segment Reporting

Harte Hanks is a leading global customer experience company. Based on the types of products and services we provide, we have organized our operations into three reportable segments: Revenue Solutions, formerly known as Marketing Services, Customer Care, and Fulfillment and Logistics.

There are three principal financial measures reported to our President (the chief operating decision maker) for use in assessing segment performance and allocating resources. Those measures are revenue, operating income and operating income plus depreciation and amortization (“EBITDA”), which is a non-GAAP measure. Operating income for segment reporting, disclosed below, is revenues less operating costs and allocated corporate expenses. Segment operating expenses are generally directly attributed to our segments and include allocations of certain centrally incurred costs such as employee benefits, occupancy, information systems, accounting services, internal legal staff, and human resources administration. These costs are allocated based on actual usage or other appropriate methods. Unallocated corporate

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expenses are corporate overhead expenses not attributable to the operating groups. Interest income and expenses are not allocated to the segments. The Company does not allocate assets to our reportable segments for internal reporting purposes, nor does our President evaluate operating segments using discrete asset information. The accounting policies of the segments are consistent with those described in Note A, Overview and Significant Accounting Policies.

SEC Regulation S-K 229.10(e)1(ii)(A) defines EBITDA as earnings before interest, taxes, depreciation and amortization. EBITDA is presented to provide additional information to investors about the Company’s operations on a basis consistent with the measures that the Company uses to manage its operations and evaluate its performance. Management also uses this measurement to evaluate working capital requirements. EBITDA should not be considered in isolation or as a substitute for operating income and net income prepared in accordance with U.S. GAAP or as a measure of the Company’s profitability.

The following table presents financial information by segment for the three months ended June 30, 2026:

In thousands						Revenue Solutions						Customer Care						Fulfillment & Logistics Services						Restructuring Expense						Unallocated Corporate						Total
Revenue						$	7,521					$	12,853					$	17,610					$	—					$	—					$	37,984
Segment labor expense						4,127						9,321						3,965						—						2,485						19,898
Other segment operating expense						1,723						1,966						11,934						—						5,644						21,267
Restructuring expense						—						—						—						187						—						187
Contribution margin (loss)						$	1,671					$	1,566					$	1,711					$	(187)					$	(8,129)					$	(3,368)
Overhead allocation						672						741						741						—						(2,154)						—
EBITDA						$	999					$	825					$	970					$	(187)					$	(5,975)					$	(3,368)
Depreciation and amortization						144						186						520						—						272						1,122
Operating income (loss)						$	855					$	639					$	450					$	(187)					$	(6,247)					$	(4,490)

The following table presents financial information by segment for the three months ended June 30, 2025:

In thousands						Revenue Solutions						Customer Care						Fulfillment & Logistics Services						Restructuring Expense						Unallocated Corporate						Total
Revenue						$	8,662					$	11,845					$	18,124					$	—					$	—					$	38,631
Segment labor expense						4,459						7,511						4,732						—						2,743						19,445
Other segment operating expense						2,189						1,992						11,224						—						2,533						17,938
Restructuring expense						—						—						—						149						—						149
Contribution margin (loss)						$	2,014					$	2,342					$	2,168					$	(149)					$	(5,276)					$	1,099
Overhead allocation						652						737						739						—						(2,128)						—
EBITDA						$	1,362					$	1,605					$	1,429					$	(149)					$	(3,148)					$	1,099
Depreciation and amortization						218						50						519						—						278						1,065
Operating income (loss)						$	1,144					$	1,555					$	910					$	(149)					$	(3,426)					$	34

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The following table presents financial information by segment for the six months ended June 30, 2026:

In thousands						Revenue Solutions						Customer Care						Fulfillment & Logistics Services						Restructuring Expense						Unallocated Corporate						Total
Revenue						$	15,437					$	25,710					$	34,101					$	—					$	—					$	75,248
Segment labor expense						8,581						18,332						7,931						—						4,864						39,708
Other segment operating expense						3,531						4,152						22,458						—						8,106						38,247
Restructuring expense						—						—						—						347						—						347
Contribution margin (loss)						$	3,325					$	3,226					$	3,712					$	(347)					$	(12,970)					$	(3,054)
Overhead allocation						1,347						1,512						1,541						—						(4,400)						—
EBITDA						$	1,978					$	1,714					$	2,171					$	(347)					$	(8,570)					$	(3,054)
Depreciation and amortization						304						318						1,036						—						546						2,204
Operating income (loss)						$	1,674					$	1,396					$	1,135					$	(347)					$	(9,116)					$	(5,258)

The following table presents financial information by segment for the six months ended June 30, 2025:

In thousands						Revenue Solutions						Customer Care						Fulfillment & Logistics Services						Restructuring Expense						Unallocated Corporate						Total
Revenue						$	17,443					$	24,847					$	37,902					$	—					$	—					$	80,192
Segment labor expense						8,946						15,527						9,294						—						5,477						39,244
Other segment operating expense						4,700						4,092						23,868						—						5,179						37,839
Restructuring expense						—						—						—						987						—						987
Contribution margin (loss)						$	3,797					$	5,228					$	4,740					$	(987)					$	(10,656)					$	2,122
Overhead allocation						1,363						1,563						1,621						—						(4,547)						—
EBITDA						$	2,434					$	3,665					$	3,119					$	(987)					$	(6,109)					$	2,122
Depreciation and amortization						435						101						1,020						—						572						2,128
Operating income (loss)						$	1,999					$	3,564					$	2,099					$	(987)					$	(6,681)					$	(6)

Note O - Subsequent Event

On August 14th, 2026, the company entered into a merger agreement with Star Equity under which, subject to the conditions set forth in the merger agreement, Star Equity Holdings, Inc. (Nasdaq: STRR, STRRP) agreed to purchase all of the outstanding shares of Harte Hanks in a stock and cash transaction. Under the terms of the merger agreement, at the effective time of the acquisition, each share of Harte Hanks common stock will be converted into the right to receive either (i) cash in an amount equal to $5.00 per share or (ii) the equivalent shares of preferred stock of Star Equity. Stockholders of Harte Hanks will have the right to elect whether to receive cash or preferred stock in the transaction, subject to a cap of 50% on the aggregate cash consideration.

The parties estimated the total consideration expected to be issued and paid to Harte Hanks stockholders in the acquisition to consist of approximately 1.92 million shares of Star Equity preferred stock and approximately $19.2 million to be paid in cash. Star Equity intends to finance the acquisition through a combination of cash on hand, issuance of preferred stock and debt financing. Star Equity intends to finance the cash component of the acquisition partly by drawing up to $15 million on the company’s existing revolving credit facility, with the balance of the cash consideration being funded from Star Equity’s cash on hand.

The merger agreement has been approved by both companies' Board of Directors. The closing of the transaction is subject to adoption of the merger agreement by our stockholders and certain other conditions specified in the merger agreement. The closing of the transaction is expected to occur in the fourth quarter of 2026.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Note Regarding Forward-Looking Statements

This report, including the Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”), contains “forward-looking statements” within the meaning of the federal securities laws. All such statements are qualified by this cautionary note, which is provided pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act. Forward-looking statements will also be included from time to time in our other public filings, press releases, our website, and oral and written presentations by management. Statements other than historical facts are forward-looking and may be identified by words such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “seeks,” “could,” “intends,” or words of similar meaning. Examples include statements regarding (1) our strategies and initiatives, including actions designed to respond to market conditions and improve our performance, (2) our financial outlook for revenues, earnings (loss) per share, operating income (loss), expense related to equity-based compensation, capital resources and other financial items, if any, (3) expectations for our businesses and for the industries in which we operate, including the impact of economic conditions of the markets we serve on the marketing expenditures and activities of our clients and prospects, (4) competitive factors, (5) acquisition and development plans, (6) expectations regarding legal proceedings and other contingent liabilities, (7) the outcome of our pending merger with Star Equity Holdings Inc., and (8) other statements regarding future events, conditions, or outcomes.

These forward-looking statements are based on current information, expectations, and estimates and involve risks, uncertainties, assumptions, and other factors that are difficult to predict and that could cause actual results to vary materially from what is expressed in or indicated by the forward-looking statements. In that event, our business, financial condition, results of operations, or liquidity could be materially adversely affected and investors in our securities could lose part or all of their investments. A discussion of some of these risks, uncertainties, assumptions, and other factors can be found in our filings with the SEC, including the factors discussed under “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the “2025 10-K”), “Part II - Item 1A. Risk Factors” in this Quarterly Report, and in our other reports filed or furnished with the SEC. The forward-looking statements included in this report and those included in our other public filings, press releases, our website, and oral and written presentations by management are made only as of the respective dates thereof, and we undertake no obligation to update publicly any forward-looking statement in this report or in other documents, our website, or oral statements for any reason, even if new information becomes available or other events occur in the future, except as required by law.

Overview

The following MD&A section is intended to help the reader understand the results of operations and financial condition of Harte Hanks, Inc. including any material changes in the Company’s financial condition and results of operations since December 31, 2025, and as compared with the three and six months ended June 30, 2026. This section is provided as a supplement to, and should be read in conjunction with, our Condensed Consolidated Financial Statements and the accompanying notes included herein as well as our 2025 10-K. Our 2025 10-K contains a discussion of other matters not included herein, such as disclosures regarding critical accounting policies and estimates, and contractual obligations. See Note A, Overview and Significant Accounting Policies, in the Notes to Condensed Consolidated Financial Statements for further information.

Harte Hanks, Inc. is a leading global customer experience company operating in three reportable segments: Revenue Solutions formerly referred to as Marketing Services, Customer Care, and Fulfillment & Logistics Services. Our mission is to partner with clients to provide them with robust customer-experience, or CX, strategy, data-driven analytics and actionable insights combined with seamless program execution to better understand, attract, and engage their customers. Our services include strategic planning, data strategy, performance analytics, creative development and execution; technology enablement; marketing automation; B2B and B2C e-commerce; cross-channel customer care; and product, print, and mail fulfillment.

We are affected by the general, national, and international economic and business conditions in the markets where we and our customers operate. Marketing budgets are largely discretionary in nature and, as a consequence, are easier for our clients to reduce in the short-term than other expenses. Our revenues are also affected by the economic fundamentals of each industry that we serve, the expansion of alternative channels, various market factors, including the demand for services by our clients, the financial condition of and budgets available to our clients, and regulatory factors, among other factors. Due to the recent increases in inflation and interest rates throughout the globe, as well as the ongoing armed conflicts in multiple regions, there is continued uncertainty and volatility in the global economy. We remain committed to

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executing our multichannel strategy while also continuing to adjust our cost structure to appropriately reflect our operations and outlook.

Management closely monitors inflation and wage pressure in the market, and the potential impact on our business. While inflation has not had a material impact on our business, it is possible a material increase in inflation could have an impact on our clients, and in turn, on our business.

Recent Development

On August 14th, 2026, the company entered into a merger agreement with Star Equity under which, subject to the conditions set forth in the merger agreement, Star Equity agreed to purchase all of the outstanding shares of Harte Hanks in a stock and cash transaction. The transaction is expected to close in the fourth quarter of 2026. See footnote O for further information about the pending acquisition.

Results of Operations

Operating results were as follows:

						Three months ended June 30,																		Six months ended June 30,
In thousands, except per share amounts						2026						% Change						2025						2026						% Change						2025
Revenue						$	37,984					-1.7%						$	38,631					$	75,248					-6.2%						$	80,192
Operating expenses						42,474						10.0%						38,597						80,506						0.4%						80,198
Operating (loss) income						$	(4,490)											$	34					$	(5,258)											$	(6)
Operating margin						(11.8%)												0.1%						(7.0%)												—%
Other expenses, net						393												447						623												1,014
Income tax provision (benefit)						120												(78)						(250)												(293)
Net loss						$	(5,003)											$	(335)					$	(5,631)											$	(727)
Basic and diluted EPS						$	(0.67)											$	(0.05)					$	(0.76)											$	(0.10)

Consolidated Results

Three months ended June 30, 2026 vs. Three months ended June 30, 2025

Revenues

Revenue decreased $0.6 million, or 1.7%, to $38.0 million in the three months ended June 30, 2026, compared to the three months ended June 30, 2025. Revenue in our Revenue Solutions segment decreased $1.1 million, or 13.2%, to $7.5 million in the three months ended June 30, 2026, compared to the three months ended June 30, 2025, and Revenue in our Fulfillment & Logistics Services segment decreased $0.5 million, or 2.8%, to $17.6 million in the three months ended June 30, 2026, compared to the three months ended June 30, 2025. Revenue in our Customer Care segment increased $1.0 million, or 8.5%, to $12.9 million in the three months ended June 30, 2026, compared to the three months ended June 30, 2025.

Operating Expenses

Operating expenses were $42.5 million in the three months ended June 30, 2026, an increase of $3.9 million, or 10.0%, compared to $38.6 million in the three months ended June 30, 2025.

Labor expenses increased $0.5 million, or 2.3%, to $19.9 million in the three months ended June 30, 2026, due to higher health benefit cost as compared to the three months ended June 30, 2025. The increase was partially offset by reduction in salary and wages as operations were optimized to account for lower revenue.

Production and Distribution expenses increased $0.1 million, or 0.7%, in the three months ended June 30, 2026, compared to the three months ended June 30 2025, primarily due to higher broker shipping costs from higher broker revenue.

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Advertising, Selling, General and Administrative expenses increased $3.2 million, or 58.6%, in the three months ended June 30, 2026, compared to the three months ended June 30, 2025, primarily due to higher professional service and legal expenses. See footnote O for further information about the pending acquisition.

Restructuring expense was $0.2 million in the three months ended June 30, 2026, as compared to $0.1 million in three months ended June 30, 2025 due to higher severance expense.

The largest components of our operating expenses are labor, transportation expenses and outsourced costs. Each of these costs is, at least in part, variable and tends to fluctuate in line with revenues and the demand for our services. Transportation rates have increased over the last few years due to demand and supply fluctuations within the transportation industry. Future changes in transportation expenses will continue to impact our total production costs and total operating expenses, and in turn our margins. Postage costs for mailings are borne by our clients and are not directly reflected in our revenues or expenses.

Other expenses, net

Other expenses, net, for the three months ended June 30, 2026 were $0.4 million which was consistent with the three months ended June 30, 2025.

Income Taxes

The income tax expense of $0.1 million for the three months ended June 30, 2026 represents an increase of income tax expense of $0.2 million when compared to the three months ended June 30, 2025. Our effective tax rate was a negative 2.5% for the three months ended June 30, 2026, a decrease of 21.3% from the effective tax rate of a positive 18.9% for the three months ended June 30, 2025, The effective income tax rates differ from the federal statutory rate of 21%, primarily due to the U.S. state income taxes and the impact of income earned in foreign jurisdictions.

Six months ended June 30, 2026 vs. Six months ended June 30, 2025

Revenues

Revenue decreased $4.9 million, or 6.2%, to $75.2 million, in the six months ended June 30, 2026, compared to the six months ended June 30, 2025 due to decreased revenue in the Fulfillment & Logistics Services and Revenue Solutions segments, which was partially offset by the increase in Customer Care segment. The reduction in revenues in the six month period relates to the conclusion of programs, and the ordinary turnover of customers at a higher rate than initiation of new programs and revenues from new customers.

Operating Expenses

Operating expenses were $80.5 million in the six months ended June 30, 2026, a decrease of $0.3 million, or 0.4%, compared to $80.2 million in the six months ended June 30, 2025.

Labor expense increased $0.5 million, or 1.2%, to $39.7 million in the six months ended June 30, 2026, primarily due to higher health benefit costs which was partially offset by reduction in salary and wages as operations were optimized to account for lower revenue.

Production and Distribution expenses decreased $2.6 million, or 10.0%, in the six months ended June 30, 2026, primarily due to lower transportation costs associated with lower logistics services revenue as compared to the prior year.

Advertising, Selling, General and Administrative expenses increased $3.0 million, or 26.7%, in the six months ended June 30, 2026, primarily due to higher professional service and legal expenses. See footnote O for further information about the pending acquisition.

Restructuring expense was $0.3 million in the six months ended June 30, 2026, as compared to $1.0 million in the six months ended June 20, 2025 due to lower severance expense.

The largest components of our operating expenses are labor, transportation expenses and outsourced costs. Each of these costs is, at least in part, variable and tends to fluctuate in line with revenues and the demand for our services.

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Transportation rates have increased over the last few years due to demand and supply fluctuations within the transportation industry. Future changes in transportation expenses will continue to impact our total production costs and total operating expenses, and in turn our margins. Postage costs for mailings are borne by our clients and are not directly reflected in our revenues or expenses.

Other expenses, net

Other expenses, net, for the six months ended June 30, 2026 were $0.6 million compared to $1.0 million, in the prior year period. The decrease was mainly associated with changes in foreign currency gain and loss account.

Income Taxes

The income tax benefit of $0.3 million in the six months ended June 30, 2026 is comparable to the income tax benefit of $0.3 million in the same period of 2025. Our effective tax rate was a positive 4.3% for the six months ended June 30, 2026, a decrease of 24.5% from the effective tax rate of a positive 28.7% for the same period of 2025. The effective tax rate differs from the federal statutory rate of 21.0%, primarily due to the U.S. state income taxes and income earned in foreign jurisdictions.

Segment Results

The following is a discussion and analysis of the results of our reportable segments for the three and six months ended June 30, 2026 and 2025. There are three principal financial measures reported to our President (the chief operating decision maker) for use in assessing segment performance and allocating resources. Those measures are revenue and operating income and operating income plus depreciation and amortization (“EBITDA”). For additional information, see Note N, Segment Reporting, in the Notes to Condensed Consolidated Financial Statements.

Revenue Solutions:

						Three months ended June 30,																		Six months ended June 30,
In thousands						2026						% Change						2025						2026						% Change						2025
Revenue						$	7,521					(13.2)%						$	8,662					15,437						(11.5)%						$	17,443
EBITDA						999						(26.7)%						1,362						1,978						(18.7)%						2,434
Operating income						855						(25.3)%						1,144						1,674						(16.3)%						1,999

Three months ended June 30, 2026 vs. Three months ended June 30, 2025

Revenue Solutions segment revenue decreased $1.1 million, or 13.2%, due to customer turnover and the decline of client spending in excess of new business. Operating income for the three months ended June 30, 2026 decreased $0.3 million, or 25.3% from the prior year quarter due to the reduced revenue.

Six months ended June 30, 2026 vs. Six months ended June 30, 2025

Revenue Solutions segment revenue decreased $2.0 million, or 11.5%, due to customer turnover and the additional client spending reductions. This segment is our most economically sensitive segment with regard to changes in our clients' marketing strategy. Operating income for the six months ended June 30, 2026 decreased $0.3 million , or 16.3% from the prior year quarter primarily due to the reduced revenue.

Customer Care:

						Three months ended June 30,																		Six months ended June 30,
In thousands						2026						% Change						2025						2026						% Change						2025
Revenue						$	12,853					8.5%						$	11,845					$	25,710					3.5%						$	24,847
EBITDA						825						(48.6)%						1,605						1,714						(53.2)%						3,665
Operating income						639						(58.9)%						1,555						1,396						(60.8)%						3,564

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Three months ended June 30, 2026 vs. Three months ended June 30, 2025

Customer Care segment revenue increased $1.0 million, or 8.5%, primarily driven by the revenue from our new customers. Operating income was $0.6 million for the three months ended June 30, 2026, compared to operating income of $1.6 million for the three months ended June 30, 2025. The $0.9 million decrease in operating income was due to higher labor expenses derived from increased headcount for new business as compared to the prior year quarter.

Six months ended June 30, 2026 vs. Six months ended June 30, 2025

Customer Care segment revenue increased $0.9 million, or 3.5%, primarily driven by the revenue from our new customers. Operating income was $1.4 million for the six months ended June 30, 2026, compared to operating Income of $3.6 million for the six months ended June 30, 2025 The decrease of $2.2 million in operating income was due to higher labor expense derived from increased headcount for new business as compared to the prior year period.

Fulfillment & Logistics Services:

						Three months ended June 30,																		Six months ended June 30,
In thousands						2026						% Change						2025						2026						% Change						2025
Revenue						$	17,610					(2.8)%						$	18,124					$	34,101					(10.0)%						$	37,902
EBITDA						970						(32.1)%						1,429						2,171						(30.4)%						3,119
Operating income						450						(50.5)%						910						1,135						(45.9)%						2,099

Three months ended June 30, 2026 vs. Three months ended June 30, 2025

Fulfillment & Logistics Services segment revenue decreased $0.5 million, or 2.8%, primarily due to the lower volume from the existing customers not being offset by growth in new programs and customers. Operating income decreased by $0.5 million primarily due to lower revenue.

Six months ended June 30, 2026 vs. Six months ended June 30, 2025

Fulfillment & Logistics Services segment revenue decreased by $3.8 million, or 10.0%, due to lost customers and the lower volume from existing customers. Operating income decreased by $1.0 million, or 84.9% due to the lower revenue.

Liquidity and Capital Resources

Sources and Uses of Cash

Our cash and cash equivalent balances were $5.2 million and $5.6 million at June 30, 2026 and December 31, 2025, respectively. As of June 30, 2026, we had the ability to borrow $21.3 million under our Credit Facility in addition to the existing letters of credit.

Our principal sources of liquidity are cash on hand, cash provided by operating activities, and borrowings available under our Credit Facility. Our cash is primarily used for general corporate purposes, working capital requirements, and capital expenditures. At this time, we believe that we will be able to continue to meet our liquidity requirements and fund our fixed obligations such as finance and operating leases and unfunded pension plan benefit payments and other needs for our operations in the short term and beyond. Although the Company believes that it will be able to meet its cash needs for the short and medium term, if unforeseen circumstances arise the Company may need to seek alternative sources of liquidity.

Operating Activities

Net cash used in operating activities for the six months ended June 30, 2026 was $2.6 million, compared to net cash used in operating activities of $5.7 million for the six months ended June 30, 2025. The $3.0 million year-over-year increase in cash used in operating activities was primarily due to $7.5 million change in other assets and current liabilities, which was partially offset by additional $4.9 million net loss in the six months ended June 30, 2026 as compared to the six months ended June 30, 2025.

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Investing Activities

Net cash used in investing activities was $0.3 million for the six months ended June 30, 2026, which was comparable to the cash used in investing activities during the same period in 2025.

Financing Activities

Net cash provided by financing activities was $2.9 million for the six months ended June 30, 2026, as compared to $0.7 million of net cash provided by financing activities during the six months ended June 30, 2025. The $2.2 million increase in cash provided by financing activities was primarily related to the $3.0 million we borrowed under our Credit Facility during the six months ended June 30, 2026 as compared to $0.8 million of cash we received for the recovery of short-swing profit from one shareholder in the six months ended June 30, 2025.

Foreign Holdings of Cash

Consolidated foreign holdings of cash as of June 30, 2026 and December 31, 2025 were $1.7 million and $2.2 million, respectively.

Debt

On December 21, 2021, the Company entered into a three-year, $25.0 million asset-based revolving credit facility (the "Credit Facility") with Texas Capital Bank ("TCB"). The Company’s obligations under the Credit Facility are guaranteed on a joint and several basis by the Company’s material subsidiaries (the “Guarantors”). The Credit Facility is secured by substantially all of the assets of the Company and the Guarantors pursuant to a Pledge and Security Agreement, dated as of December 21, 2021, among the Company, TCB and the other Guarantors party thereto (the “Security Agreement"). On June 24, 2025, the Company entered into a second amendment to the Credit Facility (the “Second Amendment”) with TCB which extended the maturity date for the Credit Facility by a period of three years to June 30, 2028. The Second Amendment also includes an accordion feature that allows the Company to seek up to a $10.0 million increase in commitments under the credit line, subject to TCB approval.

The Credit Facility provides for loans up to the lesser of (a) $25.0 million, and (b) the amount available under a "borrowing base" calculated primarily by reference to the Company's cash and cash equivalents and accounts receivables. The Credit Facility allows the Company to use up to $3.0 million of its borrowing capacity to issue letters of credit.

The loans under the Credit Facility accrue interest at a variable rate equal to the Secured Overnight Financing Rate (SOFR) plus a margin of 2.25% per annum. The latest rate was 5.99% as of June 30, 2026. The outstanding amounts advanced under the Credit Facility are due and payable in full on June 30, 2028.

The Company may repay and reborrow all or any portion of the loans advanced under the Credit Facility at any time, without premium or penalty. The Credit Facility is subject to mandatory prepayments (i) from the net proceeds of asset dispositions not otherwise permitted under the Credit Facility; (ii) if the unpaid principal balance under the Credit Facility plus the aggregate face amount of all outstanding letters of credit exceeds the borrowing base; (iii) in an amount equal to 50% of the net proceeds of issuances of capital stock (subject to customary exceptions); or (iv) in an amount equal to the net proceeds from any issuance of debt not otherwise permitted under the Credit Facility. .

The Credit Facility contains certain covenants restricting the Company's and its subsidiaries' ability to create, incur, assume or become liable for indebtedness; make certain investments; pay dividends or repurchase the Company's stock; create, incur or assume liens; consummate mergers or acquisitions; liquidate, dissolve, suspend or cease operations; or modify accounting or tax reporting methods (other than as required by U.S. GAAP).

As of June 30, 2026 and December 31, 2025, we had $3.0 million and no borrowings outstanding under the Credit Facility, respectively. At each of June 30, 2026 and December 31, 2025, we had letters of credit outstanding in the amount of $0.7 million and $0.7 million, respectively. No amounts were drawn against these letters of credit at June 30, 2026 and December 31, 2025. These letters of credit exist to support insurance programs relating to workers’ compensation and general liability as well as lease obligations. We had no other off-balance sheet financing activities at June 30, 2026 and December 31, 2025.

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As of June 30, 2026, we had the ability to borrow $21.3 million under our Credit Facility in addition to the existing letters of credit.

Dividends

We did not pay any dividends in the three and six months ended June 30, 2026 and 2025. Any future dividend declaration can be made only upon, and subject to, approval of our Board of Directors, and will depend on our results of operations, financial condition, cash requirements, future business prospects, contractual and indenture restrictions and other factors deemed relevant by our Board of Directors.

Share Repurchase

On May 2, 2023, the Board of Directors of Harte Hanks approved a share repurchase program to maximize shareholder value with authorization to repurchase $6.5 million of the Company’s Common Stock. As of June 30, 2026, the share repurchase program authorization availability was $4.1 million. We did not repurchase any of the Company's Common Stock during the three and six months ended June 30, 2026 and 2025.

Outlook

We consider such factors as total cash and cash equivalents and restricted cash, current assets, current liabilities, total debt, revenues, operating income, cash flows from operations, investing activities, and financing activities when assessing our liquidity. Our management of cash is designed to optimize returns on cash balances and to ensure that it is readily available to meet our operating, investing, and financing requirements as they arise. We believe that there are no conditions or events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern for the twelve months following the issuance of the Condensed Consolidated Financial Statements.

Critical and Recent Accounting Policies

Critical accounting estimates are defined as those that, in our judgment, are most important to the portrayal of our Company’s financial condition and results of operations and which require complex or subjective judgments or estimates. Actual results could differ materially from those estimates under different assumptions and conditions. Refer to the 2025 10-K for a discussion of our critical accounting estimates.

Our Significant Accounting policies are described in Note A, Overview and Significant Accounting Policies, in the Notes to Condensed Consolidated Financial Statements.

See Recent Accounting Pronouncements under Note B of the Notes to Condensed Consolidated Financial Statements for a discussion of certain accounting standards that have been recently issued.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including our President and Chief Financial Officer (“CFO”), as appropriate to allow timely decisions regarding required disclosure.

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Our management, including our President and CFO, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of June 30, 2026, the end of the period covered by this Quarterly Report on Form 10-Q. Based upon such evaluation, our President and CFO concluded that the design and operation of these disclosure controls and procedures were effective, at the “reasonable assurance” level, to ensure information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms.

Changes in Internal Control over Financial Reporting

There were no changes in our internal controls over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Information regarding legal proceedings is set forth in Note L, Litigation and Contingencies, in the Notes to Condensed Consolidated Financial Statements in Item 1 of Part I of this Quarterly Report on Form 10-Q, which information is incorporated herein by reference.

Item 1a. Risk Factors

In addition to the other information set forth below, you should carefully consider the factors discussed in Part I, “Item 1A. Risk Factors” in our 2025 10-K, which could materially affect our business, financial condition, or future results. These risks are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, and operating results.

Risks Related to the Proposed Acquisition with Star Equity

The transactions contemplated by the merger agreement are subject to conditions, including certain conditions that may not be satisfied or completed on a timely basis or at all. Failure to complete the transactions contemplated by the merger agreement, including the merger, could have material and adverse effects on us.

Completion of the merger is subject to a number of conditions, including, among other things, (i) the adoption of the merger agreement by the holders of our common stock, (ii) the absence of any law or order prohibiting the consummation of the merger, and (iii) the effectiveness of the registration statement on Form S-4 pursuant to which the shares of Star Equity’s preferred stock issuable in the merger are registered with the SEC. Such conditions, some of which are beyond our control, may not be satisfied or waived in a timely matter and therefore make the completion and timing of the completion of the merger uncertain.

If the transactions contemplated by the Merger Agreement are not completed, our ongoing business may be adversely affected and, without realizing any of the benefits of having completed the merger, we will be subject to a number of risks, including the following: we may be required to pay our costs relating to the merger, such as legal, accounting, and financial advisory fees, whether or not the merger is completed; time and resources committed by our management to matters relating to the merger could otherwise have been devoted to pursuing other beneficial opportunities; the market price of our common stock could be impacted to the extent that the current market price reflects a market assumption that the merger will be completed; and if the merger agreement is terminated and our Board of Directors seeks another business combination, our shareholders cannot be certain that we will be able to find a party willing to enter into a transaction as attractive to us as the transaction with Star Equity.

In addition, the merger agreement contains certain termination rights for both Star Equity and us, which if exercised, will also result in the transactions contemplated by the merger agreement not being consummated. If the merger agreement is terminated under certain circumstances, we could be required to pay Star Equity a termination fee.

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We will be subject to business uncertainties while the merger is pending, which could adversely affect our business.

It is possible that certain persons with whom we have a business relationship may delay certain business decisions relating to us in connection with the pendency of the merger or they might decide to seek to terminate, change or renegotiate their relationships with us as a result of the merger, which could negatively affect our revenues, earnings and cash flows, as well as the market price of our common stock, regardless of whether the merger is completed. Also, our ability to attract, retain and motivate employees may be impaired while the merger is pending as current and prospective employees may experience uncertainty about their roles within the combined company following the merger.

In addition, under the terms of the merger agreement, we are subject to certain restrictions on the conduct of our business prior to the completion of the merger, which may adversely affect our ability to execute certain of our business strategies, including the ability in certain cases to modify or enter into certain contracts, acquire or dispose of assets, hire or terminate certain employees or take other specified actions regarding employees and compensation, or incur certain indebtedness, incur encumbrances, make capital expenditures, issue shares or settle claims. Such limitations could negatively affect our business and operations prior to the completion of the merger.

Even if the merger is completed, the integration of Harte Hanks by Star Equity may not be as successful as anticipated.

The success of the merger will depend, in part, on Star Equity’s ability to realize the anticipated benefits and cost savings from combining our and Star Equity’s businesses, and there can be no assurance that the combined company will be able to successfully realize the expected benefits of the merger, which in turn could impact the value of preferred stock of Star Equity that is issued as merger consideration.

We expect to incur significant transaction fees and costs in connection with the merger.

We have incurred and expect to continue to incur a number of non-recurring costs associated with negotiating and completing the merger. These fees and costs have been, and will continue to be substantial and, in many cases, will be borne by us whether or not the transaction is completed. A substantial majority of our non-recurring expenses will consist of transaction costs related to the merger and include, among others, fees paid to financial, legal, accounting and other advisors.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

We did not sell any unregistered equity securities during the quarter ended June 30, 2026.

The following table provides information with respect to purchases by the Company of shares of our Common Stock during the quarter ended June 30, 2026:

Period						Total Number of Shares (or units) Purchased						Average Price per Share (or unit)						Total number of Shares Purchased as Part of a Publicly Announced Plan or Program						Approximate dollar value of shares that may yet be purchased under the program(1)
																								in thousands
April 1, 2026 to April 30, 2026						—						$	—					—						$	4,131
May 1, 2026 to May 31, 2026						—						$	—					—						4,131
June 1, 2026 to June 30, 2026						—						$	—					—						4,131
						—												—						$	4,131

(1)On May 2, 2023, the Board of Directors of the Company approved a share repurchase program to maximize shareholder value with authorization to repurchase $6.5 million of the Company’s Common Stock. No repurchases were made during the quarter ended June 30, 2026. After giving effect to the repurchases made under the plan through June 30, 2026, the Company has remaining authority of $4.1 million to repurchase shares under the program.

Item 3. Defaults Upon Senior Securities

Not applicable.

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Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

During the quarter ended June 30, 2026, no director or officer (as defined in Rule 16a-1(f) of the Exchange Act) of the Company adopted, modified or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408 of Regulation S-K.

Item 6. Exhibits

Exhibit No.						Description of Exhibit
*10.1						Form of Indemnification Agreement for Directors and Officers.
*10.2						Agreement and plan of merger between Star Holdings Equity and Harte Hanks, Inc. dated August 14, 2026.
*10.3						Amendment to employment agreement between the Company and David Fisher dated August 14, 2026.
*10.4						Amendment to employment agreement between the Company and David Garrison dated August 14, 2026.
*31.1						Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
*31.2						Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
*32.1						Furnished Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
*32.2						Furnished Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
*101.INS						Inline XBRL Instance Document - the instance document does not appear in the Interactive Data Files because its XBRL tags are embedded within the Inline XBRL Document.
*101.SCH						Inline XBRL Taxonomy Extension Schema Document
*101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document
*101.LAB						Inline XBRL Taxonomy Extension Labels Linkbase Document
*101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document
*101.DEF						Inline XBRL Definition Linkbase Document
*104						Cover Page Interactive Data File (embedded within the Inline XBRL and contained in Exhibit 101)

__________________________________

*Filed or furnished herewith, as applicable.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

						HARTE HANKS, INC.
August 14, 2026						/s/ David Fisher
Date						David Fisher
						President
August 14, 2026						/s/ David Garrison
Date						David Garrison
						Chief Financial Officer

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ATTACHMENTS / EXHIBITS

EX-31.1

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EX-10.1

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