Total corrugated products shipments were up 24.3% per day and in total compared to the second quarter of 2025.
July 23, 2026 - Packaging Corporation of America (NYSE: PKG) on July 22 reported second quarter 2026 net income of $192 million, or $2.15 per share, and net income of $210 million, or $2.35 per share, excluding special items. Second quarter net sales were $2.5 billion in 2026 and $2.2 billion in 2025.
Reported earnings in the second quarter of 2026 include special items primarily for facility closure costs and write-offs, costs related to the restructuring of the Wallula, Washington containerboard mill and acquisition and integration-related costs. Reported earnings in the second quarter of 2025 included special items relating to gains on the sale of real estate in connection with the closure of corrugated products facilities, partially offset by acquisition and integration related costs.
Excluding special items, the ($.13) per share decrease in second quarter 2026 earnings compared to the second quarter of 2025 resulted from ($.27) lower earnings in the legacy business, partially offset by $.14 of earnings from the acquired Greif operations. The lower earnings in the legacy business was driven by higher freight costs ($.26), higher corporate and other expenses ($.12), unfavorable price and mix in the packaging business ($.11), higher labor and operating costs ($.05), higher depreciation and amortization expenses ($.03), higher fiber costs ($.02), higher tax rate ($.02) and higher interest expense, excluding Greif acquisition indebtedness ($.01). These items were partially offset by higher production and sales volume in the packaging business $.26, lower maintenance outage expenses $.04, higher production and sales volume in the paper business $.03 and higher price and mix in the paper business $.02. The $.14 of Greif earnings during the quarter included a $.04 benefit to depreciation expense due to measurement period adjustments for the valuation of certain fixed assets on the opening balance sheet of the acquired business.
Earnings were $.02 above second quarter guidance of $2.33 per share primarily due to favorable volume in the legacy packaging business, lower production costs in the legacy packaging business and higher than expected earnings from the acquired business due to favorable volume, price and mix, partially offset by higher-than-forecast costs for freight, recycled fiber and employee benefits.
Total corrugated products shipments were up 24.3% per day and in total compared to the second quarter of 2025. In the legacy packaging business, corrugated products shipments were up 4.1% per day and in total compared to the second quarter of 2025, with the same number of shipping days in each period.
Containerboard production was 1,415,000 tons, and containerboard inventory was down 25,000 tons compared to the first quarter of 2026 and up 40,000 tons compared to the second quarter of 2025, primarily due to the acquisition.
In the Paper segment, sales volume was up 6.3% from the second quarter of 2025.
Commenting on reported results, Mark W. Kowlzan, Chairman and CEO, said, "We achieved an all-time quarterly record in total corrugated shipments in our legacy corrugated operations. Demand remained strong throughout the entire quarter, and we began to meaningfully realize the first of our previously announced price increases in the corrugated products business.
"The acquired Greif business contributed to earnings, driven by strong volumes at the corrugated plants and improved operational performance at the mills, with production consistently exceeding capabilities at the time of the acquisition.
"We continued to operate our mill system at full capacity and reduced export sales by approximately 30,000 tons from first quarter levels to support our corrugated products demand. Our volumes and outstanding operating performance across our businesses helped us mitigate significantly higher freight and recycled fiber costs."
Mr. Kowlzan added, "Looking ahead as we move from the second quarter into the third quarter, we expect continued strong demand in the Packaging segment and corrugated products volume to increase with one more shipping day. Prices for containerboard and corrugated products will be higher as we complete the implementation of our first announced price increase and begin to realize our second announced price increase. Packaging mill production will be higher with one more operating day and lower impact to production from maintenance outages. We expect better operating performance across our containerboard mill system with continued improved capabilities from our Jackson mill and our acquired Greif mills.
"Mill maintenance outage expenses will be lower in total and in the Packaging segment and higher in the Paper segment with the scheduled outage at the International Falls mill. We expect lower volume and higher prices in the Paper segment as a result of the maintenance outage and the continued implementation of our previously announced paper price increases.
"We expect costs for freight to remain at or around the elevated levels we experienced in May and June and higher for the quarter. Prices for recycled fiber are continuing to increase and higher mill production will drive increased usage. Costs for chemicals and purchased electricity will be higher and will remain relatively flat for wood fiber and natural gas. We expect improvement in benefits costs due to second quarter unfavorability that is not expected to repeat in the third quarter. Considering these items, we expect third quarter earnings of $ 2.91 per share, excluding special items."
PCA noted, "We present our earnings expectation for the upcoming quarter excluding special items as special items are difficult to predict and quantify and may reflect the effect of future events. We currently expect to incur acquisition and integration related costs and costs related to the closure of corrugated products facilities during the third quarter; however, additional special items may arise due to third quarter events."
PCA is the third largest producer of containerboard products and a leading producer of uncoated freesheet paper in North America. PCA operates ten mills and 90 corrugated products plants and related facilities.
SOURCE: Packaging Corporation of America (PCA)