Why did fourth quarter 2025 earnings fall year over year?

Excluding special items, Q4 2025 EPS was $2.32 versus $2.47 in Q4 2024, a $0.15 decline. The company cited lower legacy production and sales volume ($0.23), higher operating costs ($0.23), higher maintenance outage expense ($0.14), and higher depreciation ($0.07), partly offset by higher prices and mix in packaging ($0.50) and lower fiber costs ($0.10).

What is the outlook for the first quarter of 2026?

Management expects first quarter 2026 earnings of $2.20 per share excluding special items. It expects higher per-day legacy corrugated volume, continued strength in the acquired corrugated operations, and higher domestic containerboard and corrugated prices, with benefits from containerboard price increases beginning in March. Headwinds include two fewer operating days, a scheduled outage at the Counce, TN mill, lower production at the reconfigured Wallula mill, and higher labor, freight, and winter-related wood, energy, and chemical costs.

How is the Greif containerboard acquisition performing?

The acquired Greif business, including interest on acquisition indebtedness, generated a loss of $0.05 per share in Q4 2025, due to extended outages at the Massillon containerboard mill for reliability maintenance and inventory management. Management stated it made tremendous progress on integration and has no planned outages at the acquired mills during the first half of 2026. Full year acquisition and integration costs were $33.2 million.

What special charges did the company record, and what is the Wallula restructuring?

The company recorded $128.0 million of charges related to the announced discontinuation of the No. 2 machine and kraft pulping activities at the Wallula, Washington containerboard mill. The company also expects to incur additional Wallula restructuring, acquisition and integration, and facility closure costs in the first quarter of 2026. Management said the Wallula cost structure will begin to benefit from the reconfiguration in March.

How did capital spending, cash, and share repurchases change?

Capital spending was $828.9 million for 2025, compared with $669.7 million for 2024. Cash, cash equivalents, and marketable debt securities were $667.8 million at December 31, 2025, down from $852.2 million a year earlier. The company repurchased 760,000 shares in the fourth quarter at an average price of $201 per share.

PKG 8-K: Earnings & Results

01—Abstract

Summary

Summary of the 8-K filed January 28, 2026. Cited figures are marked; the original filing is the authoritative source.

Packaging Corporation of America reported fourth quarter 2025 net income of $102 million^a, or $1.13 per share, compared with $221.1 million, or $2.45 per share, in the fourth quarter of 2024.

Excluding special items, fourth quarter net income was $209 million^b, or $2.32 per share, versus $2.47 per share a year earlier. For full year 2025, net income was $774 million, or $8.58 per share, and $888 million, or $9.84 per share excluding special items, compared with $805 million, or $8.93 per share, and $814 million, or $9.04 per share, excluding special items in 2024. Net sales were $9.0 billion for 2025 and $8.4 billion for 2024.

Reported results include special items for the restructuring of the Wallula, WA containerboard mill ($128.0 million^c of charges), acquisition and integration costs for the Greif containerboard business ($33.2 million for the full year), and corrugated facility closures. Fourth quarter results came in below the company's own guidance because of unfavorable December volume and mix in the legacy corrugated business and lower production and sales volume in the acquired Greif business, which had extended outages at the Massillon mill. Legacy corrugated shipments per day were down 1.7% from the fourth quarter of 2024, while shipments per day including Greif were up 17.0%.

Management said its order book strengthened through the quarter and demand improved in January. For the first quarter of 2026, management expects earnings of $2.20^d per share excluding special items.

The outlook reflects higher domestic containerboard and corrugated prices, with containerboard price increases beginning in March, offset by two fewer operating days, a scheduled outage at the Counce, TN mill, lower output at the reconfigured Wallula mill, and cost inflation. The company also noted that a winter storm could affect shipments and costs.

02—Key points

Key Highlights

Q4 2025 net income was $102 million ($1.13 per share), down from $221.1 million ($2.45 per share) in Q4 2024; excluding special items, EPS was $2.32 versus $2.47 a year earlier.
Full year 2025 net income was $774 million ($8.58 per share), and $888 million ($9.84 per share) excluding special items, up from $9.04 per share excluding special items in 2024.
Full year 2025 net sales were $9.0 billion, compared with $8.4 billion in 2024.
Fourth quarter results were below company guidance due to unfavorable December volume and mix in legacy corrugated and lower production and sales volume at the acquired Greif business.
The Wallula, WA mill restructuring resulted in $128.0 million of special charges in Q4 2025, related to discontinuing the No. 2 machine and kraft pulping activities.
Q1 2026 EPS guidance is $2.20 excluding special items, with containerboard price increases expected to begin in March.
The company repurchased 760,000 shares in Q4 2025 at an average price of $201 per share; capital spending for 2025 was $828.9 million, and cash and marketable debt securities were $667.8 million at year-end.

03—Questions

Frequently Asked Questions

Why did fourth quarter 2025 earnings fall year over year?
Excluding special items, Q4 2025 EPS was $2.32 versus $2.47 in Q4 2024, a $0.15 decline. The company cited lower legacy production and sales volume ($0.23), higher operating costs ($0.23), higher maintenance outage expense ($0.14), and higher depreciation ($0.07), partly offset by higher prices and mix in packaging ($0.50) and lower fiber costs ($0.10).
What is the outlook for the first quarter of 2026?
Management expects first quarter 2026 earnings of $2.20 per share excluding special items. It expects higher per-day legacy corrugated volume, continued strength in the acquired corrugated operations, and higher domestic containerboard and corrugated prices, with benefits from containerboard price increases beginning in March. Headwinds include two fewer operating days, a scheduled outage at the Counce, TN mill, lower production at the reconfigured Wallula mill, and higher labor, freight, and winter-related wood, energy, and chemical costs.
How is the Greif containerboard acquisition performing?
The acquired Greif business, including interest on acquisition indebtedness, generated a loss of $0.05 per share in Q4 2025, due to extended outages at the Massillon containerboard mill for reliability maintenance and inventory management. Management stated it made tremendous progress on integration and has no planned outages at the acquired mills during the first half of 2026. Full year acquisition and integration costs were $33.2 million.
What special charges did the company record, and what is the Wallula restructuring?
The company recorded $128.0 million of charges related to the announced discontinuation of the No. 2 machine and kraft pulping activities at the Wallula, Washington containerboard mill. The company also expects to incur additional Wallula restructuring, acquisition and integration, and facility closure costs in the first quarter of 2026. Management said the Wallula cost structure will begin to benefit from the reconfiguration in March.
How did capital spending, cash, and share repurchases change?
Capital spending was $828.9 million for 2025, compared with $669.7 million for 2024. Cash, cash equivalents, and marketable debt securities were $667.8 million at December 31, 2025, down from $852.2 million a year earlier. The company repurchased 760,000 shares in the fourth quarter at an average price of $201 per share.

04—Continue

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