O-I Glass (OI) Q4 2025 earnings summary

Executive summary

• 2025 results showed significant improvement over 2024, with adjusted EPS nearly doubling to $1.60 and free cash flow rebounding to $168 million, driven by $300 million in Fit to Win cost savings and strong execution of strategic initiatives.

• Segment operating profit increased 30% year-over-year, with both Americas and Europe contributing to the gains, and Q4 adjusted earnings rebounded from a prior-year loss.

• Economic spread expanded by 200 basis points, and leverage improved to 3.5x, with a target of 2.5x by year-end 2027.

• The business portfolio was optimized for premium and resilient segments, with a strategic shift toward higher-margin categories and exit from unprofitable business.

• 2026 guidance anticipates continued momentum, with further increases in adjusted EBITDA, adjusted EPS, and free cash flow.

Financial highlights

• Net sales for 2025 were $6.4 billion, down slightly from $6.5 billion in 2024, with adjusted EBITDA rising to $1,218 million and margin expanding to 19.0% from 16.8% year-over-year.

• Free cash flow improved by $296 million to $168 million, aided by higher earnings, working capital management, and 30% lower CapEx.

• Adjusted EPS for 2025 was $1.60, up from $0.81 in 2024; Q4 adjusted EPS rebounded to $0.20 per share from a net loss prior year.

• Segment operating profit increased 13% to $846 million, with Q4 segment profit up 30% to $177 million.

• Net debt leverage ratio improved to 3.5x from 3.9x, with total debt at $5 billion and net debt at $4.2 billion.

Outlook and guidance

• 2026 guidance projects adjusted EBITDA of $1.25–$1.3 billion (up to 7% growth), adjusted EPS of $1.65–$1.90 (up to 19% growth), and free cash flow of approximately $200 million.

• Leverage ratio is expected to decline to the low 3x range by year-end 2026, targeting 2.5x by 2027.

• First quarter 2026 expected to be most challenging due to tough comps and sluggish demand; improvement anticipated as year progresses.

• 2027 Investor Day targets reaffirmed, with Fit to Win cumulative benefit target raised to at least $750 million.

• Excluding a $150 million energy cost step-up, EBITDA would rise up to 22%.