"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." – Andy Silvernail, Chairman and CEO, International Paper.
July 31, 2025 - International Paper today reported second quarter 2025 net earnings (loss) of $75 million, or $0.14 per diluted share, and adjusted operating earnings (non-GAAP) of $105 million, or $0.20 per diluted share. Second quarter 2025 net sales were $6.8 billion.
"I'm pleased to see our teams gaining momentum as we advance our transformation journey," said Chief Executive Officer Andy Silvernail. "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."
"Looking ahead," Silvernail added, "we expect stronger global revenue and earnings in the third quarter, with confirmed strategic wins across our packaging businesses, continued progress on cost-out initiatives, and fewer planned maintenance outages. We remain focused on securing an advantaged cost position, delivering superior customer experience, and maintaining a high relative supply position as we continue our transformation into a differentiated and sustainable global packaging company."
SEGMENT INFORMATION
As a result of the completed acquisition of DS Smith on January 31, 2025, the Chief Operating Decision Maker (CODM) reviews and manages the financial results and operations of the following segments on the basis of the new organizational structure: Packaging Solutions North America, Packaging Solutions EMEA and Global Cellulose Fibers.
The Packaging Solutions EMEA segment includes the Company's legacy EMEA Industrial Packaging business and the newly acquired EMEA DS Smith business. As such, amounts related to the Company's legacy EMEA Industrial Packaging business have been recast out of the previously reported Industrial Packaging business segment into the new Packaging Solutions EMEA business segment for all prior periods.
The newly acquired North America DS Smith business has been included in the Packaging Solutions North America segment. Amounts related to the Company's legacy North America Industrial Packaging business have been reported in the Packaging Solutions North America business segment for all prior periods.
Packaging Solutions North America (PS NA) business segment operating profit (loss) in the second quarter of 2025 was $277 million compared with $142 million in the first quarter of 2025. This includes business segment operating profit (loss) of $(33) million in the second quarter of 2025 and $(9) million in the first quarter of 2025 for the legacy DS Smith North America business. The financial results of the legacy DS Smith North America business include three months in the second quarter compared to two months in the first quarter. In the second quarter of 2025, PS NA net sales were higher driven by higher sales prices for boxes and containerboard and seasonally higher box volumes. Cost of products sold was impacted by lower input costs, offset by higher manufacturing costs, including planned maintenance outages. Depreciation and amortization in the second quarter of 2025 is lower primarily due to the non-repeat of $193 million of accelerated depreciation associated with the previously announced closure of our Red River containerboard mill in Campti, Louisiana. Additionally, the second quarter of 2025 results were impacted by higher overhead expenses including the non-repeat of favorable medical benefit costs in the first quarter of 2025.
Packaging Solutions EMEA (PS EMEA) business segment operating profit (loss) in the second quarter of 2025 was $(1) million compared with $46 million in the first quarter of 2025. This includes business segment operating profit (loss) of $(10) million in the second quarter of 2025 and $13 million in the first quarter of 2025 for the EMEA DS Smith legacy operations. Net sales in the second quarter of 2025 were $1.9 billion compared with $1.2 billion in the first quarter of 2025. PS EMEA includes EMEA DS Smith results for three months in the second quarter compared to two months in the first quarter. Net sales in the quarter were impacted by higher sales prices and lower volumes in a soft demand environment. Cost of products sold was impacted by higher energy costs and planned maintenance outage costs. Depreciation and amortization expense in the second quarter of 2025 is higher primarily due to the valuation of assets and changes to estimated lives associated with the acquisition accounting of DS Smith. Depreciation and amortization expense is based on an estimate of asset fair values and will be updated throughout the calendar year as we complete the purchase price allocation.
Global Cellulose Fibers business segment operating profit (loss) in the second quarter of 2025 was $(4) million compared with $17 million in the first quarter of 2025. Net sales were lower, as higher average sales prices for both fluff and commodity pulp were more than offset by lower volumes. Cost of products sold was impacted by higher planned outage costs, higher operating costs and lower energy costs. Selling and administrative expense was impacted by the non-repeat of favorable medical benefit costs in the first quarter of 2025.
International Paper (NYSE: IP; LSE: IPC) is the global leader in sustainable packaging solutions. With company headquarters in Memphis, Tennessee, USA, and EMEA (Europe, Middle East and Africa) headquarters in London, UK, IP employs more than 65,000 team members and serves customers around the world with operations in more than 30 countries.
SOURCE: International Paper