Packaging Corporation of America Q2 2025 Results: $2.2B Sales, $242M Income

Packaging Corporation of America has reported second quarter 2025 net income of $242 million and net sales of $2.2 billion, an increase from $2.1 billion in the same period last year. Excluding special items, net income was $224 million. Diluted earnings per share rose to $2.67, or $2.48 excluding special items, up from $2.20 in Q2 2024.

Packaging Segment Drives Strong Growth

The company’s Packaging segment reported $346.3 million in operating income, up from $279.8 million in 2024. Excluding special items, the segment contributed $321.7 million. Segment EBITDA excluding special items rose to $452.9 million from $400 million a year ago.

Corrugated product shipments were flat overall but rose 1.7% on a per-day basis. Containerboard production totaled 1.195 million tons. Inventory was up 38,000 tons compared to the prior year but 17,000 tons below the previous quarter. The Packaging segment benefited from improved pricing and mix, contributing $0.98 to the $0.28 per share increase in earnings compared to last year’s second quarter.

Paper Segment Remains Steady

In the Paper segment, sales volume declined 5% year-over-year and 7% quarter-over-quarter. Operating income was $25.8 million, with EBITDA excluding special items at $30.3 million. The company cited margin stability driven by price increases and steady cost management despite lower volumes.

Outlook and Guidance for Q3 2025

PCA expects third quarter 2025 earnings of $2.80 per share excluding special items. This forecast assumes flat pricing in both the Packaging and Paper segments, increased corrugated shipments, and higher containerboard production. There are no scheduled mill outages in Q3, and maintenance expenses are expected to be lower.

However, freight costs will rise due to increased rail rates. Operating costs will remain stable, and fiber costs are projected to decline slightly. PCA noted that this guidance does not include the potential impact of its pending acquisition of the Greif containerboard business, which is awaiting regulatory approval.

Special Items and Financial Position

The reported earnings include special items such as $24.6 million in gains from the sale of closed corrugated facilities, partially offset by $1.6 million in acquisition-related costs tied to the Greif deal. EBITDA excluding special items reached $450.8 million in Q2, compared to $404 million last year.

As of June 30, PCA held $955.9 million in cash and equivalents. Capital expenditures for the quarter were $169.7 million.

Packaging Corporation of America operates eight mills and 85 corrugated products facilities across North America, positioning it as the third-largest producer of containerboard in the region.