International Paper Company
Q2 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +1.30%.
Did IP Beat Earnings? Q2 2025 Results
International Paper delivered a sharply mixed second quarter, topping revenue expectations while falling well short on earnings as acquisition integration costs and margin headwinds weighed heavily on the bottom line. The company posted adjusted EPS of $0.20, missing the $0.41 consensus estimate by 51.09%, while net sales of $6.77 billion edged 0.97% above expectations and surged 42.9% year over year, reflecting the first full quarter of combined operations following the January 2025 DS Smith acquisition. The earnings shortfall was driven primarily by cost pressure in both packaging segments, a heavy planned maintenance outage schedule, and a $33 million drag from legacy DS Smith North America operations, compounded by soft European demand and higher energy costs that pushed the EMEA segment to near breakeven. CEO Andy Silvernail, who has emphasized the company's ongoing transformation through its 80/20 strategic approach, struck an optimistic tone on the path ahead, citing confirmed commercial wins, continued cost-out progress, and fewer planned maintenance outages as catalysts for stronger revenue and earnings in Q3.
- Higher sales prices for boxes and containerboard in North America
- Seasonally higher box volumes and stable demand environment in North America
- First full quarter of combined International Paper and DS Smith operations
- Lower input costs partially offset by higher manufacturing costs and planned maintenance outages
- Non-repeat of $193 million accelerated depreciation from Red River mill closure in Q1
- Soft demand environment in EMEA with higher energy costs
- Significant increase in depreciation and amortization from DS Smith acquisition accounting in EMEA
- 80/20 strategic approach driving commercial and cost-out actions
“I'm pleased to see our teams gaining momentum as we advance our transformation journey. Our second quarter results reflect a full quarter of our combined International Paper and DS Smith packaging businesses, as we effectively implement 80/20 strategies. In Packaging Solutions North America, our commercial efforts are driving increased revenue, and we experienced seasonally higher volumes and a stable demand environment. However, margins slipped as we continue to face cost headwinds, and we executed a heavy outage schedule. In Europe, demand remained soft and there was a significant increase in depreciation and amortization expense resulting from our acquisition. Overall, we have exceeded our expectations on commercial actions and are on target to achieve cost-out actions before the end of year.”
International Paper CEO, on the earnings call
Forward Guidance & Outlook
Management expects stronger global revenue and earnings in Q3 2025, supported by confirmed strategic wins across packaging businesses, continued progress on cost-out initiatives, and fewer planned maintenance outages. The company has exceeded expectations on commercial actions and is on target to achieve cost-out actions before year-end. International Paper continues to explore strategic options for its Global Cellulose Fibers business. The company remains focused on securing an advantaged cost position, delivering superior customer experience, and maintaining a high relative supply position as it transforms into a differentiated global packaging company.
IP YoY Financials
IP Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.