International Paper Reports Third Quarter 2026 Results
INTERNATIONAL PAPER CO /NEW/ (IP) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 News Release International Paper Reports Third Quarter 2026 Results THIRD QUARTER 2026 FINANCIAL SUMMARY • Net sales of $6.20 billion • Loss from continuing operations of $1.10 billion includes a $1.38 billion non-cash goodwill impairment charge for our Packaging Sol
How this was made
The 30-second read
Why it matters
The loss and impairment likely drive short‑term downside, but the company emphasizes operational improvements in North America.
Market read
Earnings miss and impairment create immediate negative sentiment for IP; sector peers may be re‑rated.
What to watch
Potential upside from upcoming North America operating profit growth and cost‑out initiatives.
International Paper reported third-quarter net sales of $6.20 billion, a loss from continuing operations of $1.10 billion including a $1.38 billion PS EMEA goodwill impairment charge, and adjusted EBITDA from continuing operations of $843 million.
Packaging Solutions North America operating profit improved to $427 million and adjusted operating EPS turned positive at $0.37, but consolidated results included a $1.38 billion non-cash PS EMEA goodwill impairment charge, PS EMEA remained loss-making, and free cash flow was $(267) million.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net sales, third quarter 2026GAAP | $6.20B | – | – |
| Earnings (loss) from continuing operations, third quarter 2026GAAP | −$1.10B | – | – |
| Net earnings (loss), third quarter 2026GAAP | −$1.13B | – | – |
| Diluted earnings (loss) per share from continuing operations, third quarter 2026GAAP | $(2.07) | – | – |
| Diluted net earnings (loss) per common share, third quarter 2026GAAP | $(2.13) | – | – |
| Adjusted operating earnings (loss), third quarter 2026non-GAAP | $197M | – | – |
| Adjusted operating earnings (loss) per share, third quarter 2026non-GAAP | $0.37 | – | – |
| Adjusted EBITDA from continuing operations, third quarter 2026non-GAAP | $843M | – | – |
| Cash provided by operating activities, third quarter 2026GAAP | $339M | – | – |
| Capital expenditures, third quarter 2026other | −$606M | – | – |
| Free cash flow, third quarter 2026non-GAAP | −$267M | – | – |
| Net sales, nine months ended September 30, 2026GAAP | $18.17B | – | – |
| Earnings (loss) from continuing operations, nine months ended September 30, 2026GAAP | −$1.03B | – | – |
| Adjusted operating earnings (loss), nine months ended September 30, 2026non-GAAP | $296M | – | – |
| Adjusted EBITDA from continuing operations, nine months ended September 30, 2026non-GAAP | $2.11B | – | – |
| Cash provided by operating activities, nine months ended September 30, 2026GAAP | $1.48B | – | – |
| Capital expenditures, nine months ended September 30, 2026other | −$1.66B | – | – |
| Free cash flow, nine months ended September 30, 2026non-GAAP | −$180M | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Packaging Solutions North AmericaBusiness segment operating profit was $427 million, compared with $(166) million in the third quarter of 2025 and $204 million in the second quarter of 2026. Third-quarter net sales increased from the second quarter reflecting higher sales prices, partly offset by lower sales volumes driven by a softer demand environment. Lower planned maintenance outage costs, lower sales volumes, improved mill performance, the non-repeat of the Riverdale paper machine conversion and a full quarter of NORPAC earnings supported results; higher recovered fiber, energy, fuel and freight costs, suspended Pine Hill operations, and higher depreciation and amortization were offsets. | $3.88B | – | – |
| Packaging Solutions EMEABusiness segment operating loss was $(73) million, compared with $(58) million in the third quarter of 2025 and $(80) million in the second quarter of 2026. Net sales decreased slightly sequentially as higher paper sales prices were more than offset by lower sales volumes in a continued soft market. Cost-out actions and lower overhead and incentive compensation expense helped, while higher energy input costs, packaging margins affected by higher paper prices not yet realized in box pricing, and accelerated depreciation associated with cost-out actions weighed on results. | $2.28B | – | – |
| Corporate and Inter-segment SalesCorporate and inter-segment sales were $14 million in the third quarter of 2025 and $29 million in the second quarter of 2026. | $37M | – | – |
Fourth quarter 2026 and full-year 2026 outlook
- NotePackaging Solutions North America business segment operating profit, fourth quarter 2026: $460-$500 million
- NotePackaging Solutions North America business segment operating profit, twelve months ended December 31, 2026: $1,345-$1,385 million
- NotePackaging Solutions North America Adjusted EBITDA, fourth quarter 2026: $700-$740 million
- NotePackaging Solutions North America Adjusted EBITDA, twelve months ended December 31, 2026: $2,270-$2,310 million
- NoteDepreciation and amortization, fourth quarter 2026: $245 million
- NoteDepreciation and amortization, twelve months ended December 31, 2026: $943 million
- NoteLess: Recycling Business EBITDA, fourth quarter 2026: $5 million
- NoteLess: Recycling Business EBITDA, twelve months ended December 31, 2026: $18 million
- NoteThe Company is no longer including Packaging Solutions EMEA financial guidance in its guidance framework and does not anticipate providing such guidance in the future.
Capital returns
- Repurchases of common stock and payments of restricted stock tax withholding, nine months ended September 30, 2026: $(31) million, compared with $(64) million in the nine months ended September 30, 2025.
- Dividends paid, nine months ended September 30, 2026: $(735) million, compared with $(733) million in the nine months ended September 30, 2025.
What drove it
- PS NA results reflected higher sales prices, although lower sales volumes were attributed to a softer demand environment.
- PS NA operating costs benefited from lower planned maintenance outage costs, improved mill performance, and the non-repeat of the Riverdale paper machine conversion.
- PS NA included a full quarter of earnings from the NORPAC mill acquisition, compared with one month of earnings in the second quarter of 2026.
- PS EMEA cost of products sold benefited from lower sales volumes and continued cost-out actions.
- PS EMEA selling and administrative expenses declined because of lower overhead and incentive compensation expense.
- Third-quarter results included a $1.38 billion pre-tax, non-cash goodwill impairment charge related to the PS EMEA business segment.
Concerns
- The Company cited persistent macro headwinds and a softer demand environment in North America.
- PS EMEA operated in a continued soft market, with lower sales volumes more than offsetting higher paper sales prices sequentially.
- PS EMEA packaging margins were affected by higher paper prices not yet realized in previously published box pricing.
- Free cash flow was $(267) million in the third quarter and $(180) million for the nine months ended September 30, 2026.
- PS EMEA recorded a $1.38 billion non-cash goodwill impairment charge as of September 30, 2026.
- The planned separation of the EMEA packaging business means International Paper will no longer provide PS EMEA financial guidance.
What to watch
- Delivery against fourth-quarter PS NA business segment operating profit guidance of $460-$500 million.
- Delivery against fourth-quarter PS NA Adjusted EBITDA guidance of $700-$740 million.
- Whether higher sales prices and lower operating costs continue to offset softer PS NA sales volumes and higher recovered fiber, energy, fuel and freight costs.
- The pace of PS EMEA margin recovery amid continued soft market conditions, higher energy costs, and box pricing that has not yet realized higher paper prices.
- Progress toward separation of the EMEA packaging business into DS Smith plc, including the Capital Markets Day scheduled for November 3, 2026.
- Capital spending and cash conversion following $(606) million of third-quarter capital expenditures and $(267) million of negative third-quarter free cash flow.
Balance sheet and cash flow
- Cash and temporary investments as of September 30, 2026: $815 million, compared with $1,145 million as of December 31, 2025.
- Notes payable and current maturities of long-term debt as of September 30, 2026: $1,963 million, compared with $992 million as of December 31, 2025.
- Long-term debt as of September 30, 2026: $7,728 million, compared with $8,839 million as of December 31, 2025.
- Total assets as of September 30, 2026: $35,637 million, compared with $37,964 million as of December 31, 2025.
- Total equity as of September 30, 2026: $13,146 million, compared with $14,827 million as of December 31, 2025.
- Nine-month cash provided by operating activities was $1,476 million; cash used for investing activities was $(907) million; cash used for financing activities was $(898) million.
- Cash and temporary investments decreased by $(346) million during the nine months ended September 30, 2026 and ended the period at $815 million.
Analysis
International Paper reported third-quarter net sales of $6,197 million, compared with $6,222 million in the third quarter of 2025 and $6,004 million in the second quarter of 2026. Adjusted EBITDA from continuing operations was $843 million, compared with $859 million a year earlier and $587 million sequentially. Adjusted operating earnings were $197 million and adjusted operating EPS was $0.37, improving from losses of $(224) million and $(0.43), respectively, in the third quarter of 2025 and from $18 million and $0.04 in the second quarter of 2026.
The GAAP loss was dominated by the $1.38 billion pre-tax, non-cash goodwill impairment of the PS EMEA business. Loss from continuing operations was $(1,097) million, and diluted loss per share from continuing operations was $(2.07). Total net special items were a $1,305 million after-tax charge, or $2.46 per diluted share. Excluding these items and non-operating pension income, the quarter produced positive adjusted operating earnings.
PS NA was the principal operating improvement. Segment operating profit rose to $427 million from $204 million in the second quarter, while sales increased to $3,880 million from $3,688 million. Higher sales prices, lower planned maintenance outage costs, improved mill performance, the non-repeat of the Riverdale paper machine conversion, and a full quarter of NORPAC earnings supported the result. The release also identifies lower volumes in a softer demand environment, higher recovered fiber, energy and fuel costs, higher freight costs, and suspended Pine Hill operations as offsets.
PS EMEA remained under pressure. Segment sales were $2,280 million and operating loss was $(73) million, an improvement from $(80) million sequentially but below the $(58) million loss reported in the prior-year quarter. Higher paper prices were more than offset by lower volumes, while higher energy costs and box pricing not yet reflecting higher paper prices constrained margins. Management is pursuing separation of the business into DS Smith plc and has removed PS EMEA financial guidance from its framework.
Cash generation was weak in the quarter following capital investment. Cash provided by operating activities was $339 million and capital expenditures were $(606) million, resulting in free cash flow of $(267) million. For the nine months ended September 30, 2026, operating cash flow was $1,476 million and free cash flow was $(180) million. The company paid $(735) million in dividends and spent $(31) million on repurchases of common stock and restricted-stock tax withholding during the nine-month period. Guidance focuses solely on PS NA, with fourth-quarter business segment operating profit of $460-$500 million and adjusted EBITDA of $700-$740 million.
Management, verbatim
Our third-quarter results reflect meaningful progress on our strategy despite persistent macro headwinds.
Andy Silvernail, Chairman and CEO
In North America, we are improving our operational performance, building a structurally lower-cost business and realizing the benefits of prior pricing actions, while continuing to create value for our customers. In EMEA, we executed well on our ongoing restructuring and cost-out initiatives, while the macro environment continued to weigh on results and pace of margin recovery.
Andy Silvernail, Chairman and CEO
We are executing on the core controllables in a more challenging world. We remain focused on building an advantaged cost position, delivering a superior customer experience and strengthening our relative supply position.
Andy Silvernail, Chairman and CEO
Not in the filing
stated, not guessed- Gross margin for the third quarter of 2026 and comparison periods was not reported.
- Consolidated operating income or loss for the third quarter of 2026 and comparison periods was not reported.
- Quarterly share repurchases and dividends paid were not reported.
- Revenue guidance was not provided.
- Gross-margin guidance was not provided.
- Operating-expense guidance was not provided.
- Tax-rate guidance was not provided.
- Prior-period guidance was not provided in the supplied documents.
- Explicit year-over-year and sequential percentage changes for consolidated revenue, earnings, cash flow, and segment revenue were not reported.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
International Paper filed a Form 8‑K reporting its Q3 2026 financials, including net sales of $6.20B and a $1.38B goodwill impairment in EMEA.
Ticker impact
International Paper disclosed Q3 2026 results with a $1.10B loss and a $1.38B goodwill impairment, plus issued guidance for its EMEA segment.
likely pressure as the market prices in the loss and impairment
Material earnings shortfall and a non‑cash charge signal weaker profitability; guidance removal for EMEA adds uncertainty.
Market effects
Packaging and paper sector may see broader scrutiny as earnings highlight macro headwinds.
North America segment shows profit, but EMEA weakness could affect European peers.
Limited to industry; no macro-wide impact.
Counterpoint
If the impairment is fully absorbed, the stock could rebound on cost‑cutting progress.
Key entities
- companyInternational Paper
Global paper and packaging producer (NYSE: IP).
