International Paper Reports Second-Quarter 2026 Results, Maintains Full-Year EBITDA Outlook

International Paper reported second-quarter 2026 net sales of $6.0 billion, while posting a loss from continuing operations of $12 million, as the company highlighted operational improvements in North America, continued cost-reduction efforts in Europe, and reaffirmed its full-year earnings outlook.

The company reported adjusted EBITDA from continuing operations of $587 million, cash provided by operating activities of $526 million, and free cash flow of negative $7 million during the quarter. International Paper expects third-quarter adjusted EBITDA of $780 million to $830 million, including an estimated $85 million negative impact from the temporary closure of its Pine Hill, Alabama mill, while maintaining its full-year 2026 adjusted EBITDA guidance of $3.2 billion to $3.4 billion.

Chairman and Chief Executive Officer Andy Silvernail said operational execution improved during the quarter, citing stronger mill performance in North America, the successful completion of the Riverdale machine conversion, continued growth in box volumes and progress in preparing the EMEA packaging business for its planned separation. He added that the company remains focused on improving network reliability, mitigating higher input costs, advancing commercial initiatives and delivering additional cost reductions during the second half of the year.

Segment performance

Packaging Solutions North America generated $3.69 billion in net sales during the quarter, compared with $3.63 billion in the previous quarter, while segment operating profit declined to $204 million from $248 million. Higher sales prices, increased sales volumes and a favorable product mix supported revenue growth. Costs increased due to planned maintenance outages and Riverdale conversion expenses, although lower energy costs, stronger mill performance and insurance recoveries partially offset these impacts. During the quarter, International Paper also completed the Riverdale machine conversion and finalized the acquisitions of the NORPAC mill in Longview, Washington, and the Delmarva corrugated packaging facility in Dover, Delaware.

Packaging Solutions EMEA reported $2.29 billion in net sales and a segment operating loss of $80 million, compared with a $51 million loss in the first quarter. The company said lower sales volumes in a soft market, driven by geopolitical uncertainty and weaker consumer sentiment, more than offset higher paper prices. Planned maintenance costs and annual wage increases also weighed on results, although cost-reduction initiatives and lower energy costs provided partial offsets.

Financial performance

Second-quarter net sales totaled $6.004 billion, compared with $6.142 billion a year earlier and $5.971 billion in the first quarter of 2026. The company reported adjusted operating earnings of $18 million, or $0.04 per share, compared with $94 million, or $0.18 per share, in the second quarter of 2025. Diluted loss from continuing operations was $0.02 per share.

Net special items resulted in an after-tax charge of $42 million, primarily reflecting $32 million after tax in costs associated with the planned separation of the Packaging Solutions EMEA business, $7 million in severance and restructuring costs related to the company's 80/20 strategic approach, $4 million in NORPAC acquisition transaction costs, partially offset by an $8 million gain from the sale of the company's box plant in Chile.

Outlook

International Paper said it remains focused on executing operational improvements, enhancing reliability across its manufacturing network, managing rising input costs and advancing commercial and cost-out initiatives. The company reaffirmed its expectation of full-year 2026 adjusted EBITDA from continuing operations of $3.2 billion to $3.4 billion, despite the anticipated temporary impact from the Pine Hill mill closure during the third quarter.