International Paper (IP) Q2 2025 earnings summary

Executive summary

• Q2 2025 net sales rose to $6.77B–$6.8B, up 43% year-over-year and 15% sequentially, driven by the DS Smith acquisition and commercial actions in North America, though margins declined due to higher costs and maintenance outages.

• Net earnings for Q2 2025 were $75M ($0.14 per diluted share), up from a $105M loss in Q1 2025 but down from $498M in Q2 2024; adjusted operating EPS was $0.20.

• Commercial and cost-out initiatives delivered $650M and $550M YTD run-rate benefits, exceeding original 2025 targets.

• The $9.9B DS Smith acquisition was completed in January 2025, with 178M new shares issued and DS Smith shareholders owning 34.1% of the combined entity.

• Divested five European box plants in June 2025 as part of regulatory remedies for the DS Smith acquisition.

Financial highlights

• Adjusted operating EPS for Q2 2025 was $0.20, down from $0.23 in Q1 2025 and $0.55 in Q2 2024, reflecting higher costs and non-recurring items.

• Free cash flow for Q2 2025 was $54M, compared to $(618)M in Q1 2025 and $167M in Q2 2024.

• Adjusted EBITDA for Q2 2025 was $733M, with margin at 10.8%, impacted by non-recurring items and higher outages in North America.

• Q2 2025 net earnings were $75M, compared to $498M in Q2 2024 and a $105M loss in Q1 2025.

• Capital expenditures for the first half of 2025 were $752M, up from $449M in the first half of 2024.

Outlook and guidance

• Expects stronger global revenue and earnings in Q3 2025, with higher volume, lower costs, and fewer planned maintenance outages.

• Company targets $27B revenue and $5.5B–$6.0B adjusted EBITDA by 2027.

• North America expected to close market share gap by Q4 2025 and grow at or above market.

• Strategic review of the Global Cellulose Fibers business is ongoing, with no assurance of a transaction.

• Europe EBITDA guidance range ($900M–$1.1B) maintained, though currently tracking at lower end due to market softness.