International Paper (NYSE:IP) shares dropped 5.1% on Thursday after the global packaging and paper producer posted a sharp third-quarter earnings miss, hurt by heavy restructuring charges tied to mill closures and its ongoing transformation efforts.
The company reported an adjusted loss of $0.43 per share, far below analyst expectations for a $0.55 profit per share. Revenue came in at $6.22 billion, missing the $6.46 billion consensus forecast.
International Paper said the results included $675 million in accelerated depreciation charges related to mill closures and other strategic actions as part of its “80/20” transformation plan — an initiative aimed at streamlining operations and boosting efficiency. Excluding those charges, adjusted EBITDA from continuing operations totaled $859 million.
“Our third quarter results reflect substantial progress on our transformation journey,” said Chairman and CEO Andy Silvernail. “We delivered 28% sequential adjusted EBITDA improvement across both Packaging Solutions businesses, driven by price realization, cost management and lower fiber costs.”
The company pointed to some encouraging trends in its North American operations, noting year-over-year box shipment growth in September, which management described as “a clear indicator that our customer-centric approach is closing the industry gap.” Still, overall demand remained muted across both North America and EMEA markets.
By division, Packaging Solutions North America swung to an operating loss of $166 million, compared to a $277 million profit in the previous quarter. The EMEA Packaging Solutions segment posted a $58 million loss, widening from a $1 million loss in Q2.
Despite the weak quarterly performance, Silvernail reaffirmed his confidence in the company’s restructuring and growth strategy:
“We are accelerating actions and remain fully committed to executing our transformation plan — delivering commercial excellence, securing an advantaged cost position, and building a differentiated, sustainable global packaging company.”
International Paper continues to focus on reshaping its portfolio toward high-value packaging solutions while improving cost efficiency and strengthening its competitive position globally.