International Paper Announces Full-Year & Q4 2025 Results and Plan to Separate into Two Public Companies

Memphis, Tennessee – January 29, 2026

International Paper today reported its full-year and fourth-quarter 2025 financial results and announced a strategic plan to separate its operations into two independent, publicly traded packaging companies, focused on North America and EMEA (Europe, Middle East & Africa).

Key Strategic Highlights

Corporate Restructuring / Spin-Off

• International Paper plans to create two independent public companies:

  • Packaging Solutions North America (PS NA)

  • Packaging Solutions EMEA (PS EMEA)

• The separation is expected to be completed within 12–15 months, subject to customary approvals.

• The move aims to create two focused, regionally scaled packaging leaders with tailored capital allocation and management strategies.

• A $2.47 billion non-cash goodwill impairment was recorded related to the PS EMEA business following a fair value assessment.

Full-Year 2025 Financial Performance

• Net Sales: $23.63 billion

• Loss from Continuing Operations: $2.84 billion

  • Includes:

    • $2.47 billion goodwill impairment (non-cash)

    • $0.96 billion accelerated depreciation from asset rationalization

    • $0.63 billion restructuring charges

• Adjusted EBITDA (non-GAAP): $2.98 billion

• Operating Cash Flow: $1.70 billion

• Free Cash Flow: $(0.16) billion

Fourth Quarter 2025 Highlights

• Net Sales: $6.01 billion

• Loss from Continuing Operations: $2.36 billion

• Adjusted EBITDA: $0.76 billion

• Operating Cash Flow: $0.91 billion

• Free Cash Flow: $0.26 billion

Segment Performance Overview

Packaging Solutions North America (PS NA)

• Q4 2025 operating profit: $319 million, a sharp recovery from Q3 loss

• Benefits from:

  • Strategic exits from non-core markets

  • Higher box pricing

  • Cost reductions and mill optimization actions

• Depreciation declined due to the completion of previously announced mill closures.

Packaging Solutions EMEA (PS EMEA)

• Q4 2025 operating loss: $(223) million

• Impacted by:

  • Soft demand environment

  • Lower pricing and volumes

  • Higher depreciation related to DS Smith acquisition accounting

• Includes accelerated depreciation tied to mill and plant closures.

M&A, Divestments & Portfolio Actions

• DS Smith Acquisition

  • Completed on January 31, 2025

  • Fully integrated into PS NA and PS EMEA segments

  • Continued realization of commercial and cost synergies

• Global Cellulose Fibers (GCF) Divestiture

  • Sold to American Industrial Partners for $1.5 billion

  • Includes $190 million preferred equity interest

  • Resulted in a $1.07 billion impairment charge in 2025

  • GCF reported as discontinued operations

Capital Expenditure & Cost Actions

• 2025 Capital Expenditure: $1.86 billion

• Continued mill closures, asset rationalization, and restructuring

• Severance and restructuring costs: $626 million in FY2025

• Actions aligned with the company’s 80/20 strategic operating model

Dividend & Shareholder Returns

• Dividends Paid in 2025: $977 million

• Management continues to prioritize:

  • Balance sheet strength

  • Disciplined capital allocation

  • Long-term shareholder value

2026 Outlook & Future Plans

• Adjusted EBITDA Guidance (2026):

  • Full Year: $3.5 – $3.7 billion

  • Q1 2026: $740 – $760 million

• Outlook reflects:

  • Above-industry growth expectations

  • Ongoing commercial execution and cost-out initiatives

  • Does not yet include potential pricing upside

• Management expects continued momentum as the company prepares for the two-company separation.

Conclusion

International Paper’s 2025 results reflect a transformational year, marked by major portfolio reshaping, disciplined cost actions, and a decisive move to unlock shareholder value through separation into two focused public companies. Despite near-term losses driven by non-cash impairments and restructuring, management projects strong EBITDA growth and improved operational performance in 2026.