third quarter 2026
Filed Oct 21, 2026Packaging Corporation of America reported third quarter 2026 net income of $262.3 million, or $2.93 per diluted share, and net income excluding special items of $272.0 million, or $3.04 per diluted share.
Third-quarter sales, GAAP earnings, non-GAAP earnings and Packaging segment operating income increased from the prior-year quarter, while non-GAAP EPS exceeded the company's $2.91 per share guidance by $0.13. Paper segment operating income declined and the fourth-quarter outlook calls for lower earnings amid significantly higher outage expense and rising freight, fiber, chemical and energy costs.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net sales, three months ended September 30GAAP | $2.60B | – | – |
| Gross profit, three months ended September 30GAAP | $603.9M | – | – |
| Selling, general, and administrative expenses, three months ended September 30GAAP | $182.7M | – | – |
| Other expense, net, three months ended September 30GAAP | $35.9M | – | – |
| Income from operations, three months ended September 30GAAP | $385.3M | – | – |
| Income from operations excluding special items, three months ended September 30non-GAAP | $397.8M | – | – |
| Interest expense, net, three months ended September 30GAAP | $32.3M | – | – |
| Income before taxes, three months ended September 30GAAP | $354.2M | – | – |
| Provision for income taxes, three months ended September 30GAAP | $91.9M | – | – |
| Net income, three months ended September 30GAAP | $262.3M | – | – |
| Net income excluding special items, three months ended September 30non-GAAP | $272M | – | – |
| Diluted earnings per share, three months ended September 30GAAP | $2.93 | – | $0.42 |
| Diluted earnings per share excluding special items, three months ended September 30non-GAAP | $3.04 | – | $0.31 |
| EBITDA, three months ended September 30non-GAAP | $566.6M | – | – |
| EBITDA excluding special items, three months ended September 30non-GAAP | $577.2M | – | – |
| Capital spending, three months ended September 30other | $247.3M | – | – |
| Cash, cash equivalents, and marketable debt securitiesother | $761.8M | – | – |
| Net sales, nine months ended September 30GAAP | $7.46B | – | – |
| Gross profit, nine months ended September 30GAAP | $1.57B | – | – |
| Income from operations, nine months ended September 30GAAP | $927.7M | – | – |
| Income from operations excluding special items, nine months ended September 30non-GAAP | $1.02B | – | – |
| Net income, nine months ended September 30GAAP | $625.3M | – | – |
| Net income excluding special items, nine months ended September 30non-GAAP | $697.4M | – | – |
| Diluted earnings per share, nine months ended September 30GAAP | $6.98 | – | – |
| Diluted earnings per share excluding special items, nine months ended September 30non-GAAP | $7.78 | – | – |
| Capital spending, nine months ended September 30other | $617.9M | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Packaging, three months ended September 30Favorable price and mix, favorable production and sales volume, including the benefit of a higher volume of containerboard supplied by the legacy mills to the acquired Greif operations, and higher earnings from acquired Greif operations. | $2.41B | – | – |
| Paper, three months ended September 30Favorable price and mix was partly offset by lower volume and higher maintenance outage expense. | $163.2M | – | – |
| Corporate and Other, three months ended September 30Corporate and other expense was higher. | $24.5M | – | – |
| Packaging, nine months ended September 30No nine-month segment-sales driver was provided. | $6.91B | – | – |
| Paper, nine months ended September 30No nine-month segment-sales driver was provided. | $480.4M | – | – |
| Corporate and Other, nine months ended September 30No nine-month segment-sales driver was provided. | $65M | – | – |
fourth quarter 2026 outlook
- NoteEarnings of $2.81 per share, excluding special items.
- NoteShipments per day are expected to be at or around last year’s fourth quarter level with two fewer shipping days than the third quarter, and total shipments are expected to be higher than the third quarter.
- NoteContainerboard production will be lower with maintenance outages at three of our mills.
- NoteMill maintenance outage expenses, including the impact on production volume from fourth quarter outages, will be significantly higher in the fourth quarter.
What drove it
- Total corrugated products shipments were up 10.6% per day and in total compared to the third quarter of 2025.
- Containerboard production was 1,489,000 tons.
- The acquired Greif operations generated earnings of $.13 in the third quarter of 2026 compared to a loss of ($.11) in the third quarter of 2025.
- Favorable Packaging segment price and mix contributed $.79 per share to the year-over-year increase in earnings excluding special items.
- Favorable Packaging segment production and sales volume, including higher containerboard supplied by legacy mills to acquired Greif operations, contributed $.12 per share.
- Favorable Paper segment price and mix contributed $.05 per share.
Concerns
- Legacy packaging corrugated products shipments were down 0.5% per day and in total compared to the third quarter of 2025.
- Paper segment sales volume was down 2.5% from the third quarter of 2025.
- Higher labor and operating expense, freight expense, corporate and other expense, fiber costs, depreciation and amortization expense, Paper maintenance outage expense, and interest expense partly offset earnings gains.
- The company cited weakness in agricultural end markets in its corrugated business.
- Fourth-quarter costs for freight, recycled fiber, wood fiber, chemicals and energy are expected to increase.
What to watch
- Implementation of earlier containerboard and corrugated products price increases.
- Fourth-quarter corrugated products mix, which is expected to be seasonally weaker with higher e-commerce volumes.
- The production and cost impact of maintenance outages at three mills in the fourth quarter.
- Continued production benefits from Jackson mill projects and improved operating performance at acquired Greif mills.
- The company's expected acquisition and integration-related costs and corrugated products facility closure costs in the fourth quarter.
Balance sheet and cash flow
- Capital spending was $247.3 million for the three months ended September 30, 2026, compared with $192.1 million for the three months ended September 30, 2025.
- Capital spending was $617.9 million for the nine months ended September 30, 2026, compared with $509.9 million for the nine months ended September 30, 2025.
- Cash, cash equivalents, and marketable debt securities were $761.8 million, compared with $806.4 million.
Analysis
Third-quarter performance strengthened year over year. Net sales were $2,601.7 million versus $2,313.4 million, while GAAP net income was $262.3 million versus $226.9 million. Diluted EPS was $2.93 versus $2.51, and diluted EPS excluding special items was $3.04 versus $2.73. Excluding special items, earnings were $.13 above the company’s third-quarter guidance of $2.91 per share, primarily due to favorable Packaging price and mix and favorable earnings from acquired Greif operations.
Packaging was the principal earnings contributor. Packaging segment sales were $2,414.0 million and segment operating income was $397.8 million, compared with $327.5 million in the prior-year quarter. Total corrugated products shipments were up 10.6% per day and in total, while the acquired Greif operations generated earnings of $.13 compared with a loss of ($.11). This was partly tempered by legacy packaging shipment declines of 0.5% per day and in total, as well as management's reference to weakness in agricultural end markets.
Paper sales were $163.2 million, while Paper segment operating income declined to $29.0 million from $35.6 million. The release attributes the legacy-business earnings bridge to favorable Paper price and mix, offset by higher Paper maintenance outage expense and lower Paper volume. Paper sales volume was down 2.5% from the prior-year quarter. At the consolidated level, cost pressure included higher labor and operating expense, freight, corporate and other expense, fiber costs, depreciation and amortization, and interest expense.
Capital spending was $247.3 million for the quarter and $617.9 million for the nine months ended September 30, 2026. Cash, cash equivalents, and marketable debt securities were $761.8 million. The filing did not report share repurchases, dividends, debt, operating cash flow or free cash flow. Nine-month GAAP results remained below the prior-year period, with net income of $625.3 million versus $672.3 million and diluted EPS of $6.98 versus $7.45, although net income excluding special items was $697.4 million versus $679.1 million.
For the fourth quarter, the company expects earnings of $2.81 per share excluding special items. Management expects solid corrugated demand, higher total corrugated shipments than the third quarter, and improved containerboard and corrugated prices, but seasonally weaker corrugated mix. The outlook also incorporates lower containerboard production, significantly higher maintenance outage expense at three mills, seasonally lower Paper volume, and increases in freight, recycled fiber, wood fiber, chemical and energy costs.
Management, verbatim
We executed very well across all aspects of our operations, resulting in very strong earnings performance for the quarter despite continued cost headwinds from freight, recycled fiber and chemicals and some weakness in agricultural end markets in our corrugated business.
Mark W. Kowlzan, Chairman and CEO
Considering these items, we expect fourth quarter earnings of $2.81 per share, excluding special items.
Mark W. Kowlzan, Chairman and CEO
Not in the filing
stated, not guessed- Gross margin
- Operating cash flow
- Free cash flow
- Debt
- Dividends
- Share repurchases
- Revenue guidance
- Gross-margin guidance
- Operating-expense guidance
- Tax-rate guidance
- Prior-quarter comparisons for reported financial metrics
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.