Third Quarter 2026
Filed Oct 21, 2026Sonoco Reports Third Quarter 2026 Results
Third-quarter net sales declined (4.2)% and adjusted operating profit, adjusted EBITDA, adjusted net income and adjusted EPS all declined year over year. A $829 million non-cash goodwill impairment drove a GAAP net loss of $(732) million, while operating cash flow was $285 million and Industrial net sales increased 5.2%.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net sales, three months ended September 27, 2026GAAP | $2.04B | – | (4.2) % |
| Gross profit, three months ended September 27, 2026GAAP | $405.3M | – | – |
| Selling, general and administrative expenses, three months ended September 27, 2026GAAP | $186.8M | – | – |
| Restructuring/Asset impairment charges, net, three months ended September 27, 2026GAAP | $856.4M | – | – |
| Operating (loss)/profit, three months ended September 27, 2026GAAP | −$638M | – | (427.2) % |
| Net (loss)/income attributable to Sonoco, three months ended September 27, 2026GAAP | −$732M | – | (695.6) % |
| EPS (diluted), three months ended September 27, 2026GAAP | $(7.36) | – | (698.4) % |
| Adjusted operating profit, three months ended September 27, 2026non-GAAP | $268M | – | (13.1) % |
| Adjusted EBITDA, three months ended September 27, 2026non-GAAP | $352M | – | (9.0) % |
| Adjusted net income attributable to Sonoco, three months ended September 27, 2026non-GAAP | $167M | – | (12.5) % |
| Adjusted EPS (diluted), three months ended September 27, 2026non-GAAP | $1.67 | – | (13.0) % |
| Operating cash flow, three months ended September 27, 2026GAAP | $285M | – | – |
| Net sales, nine months ended September 27, 2026GAAP | $5.60B | – | (2.6) % |
| Gross profit, nine months ended September 27, 2026GAAP | $1.14B | – | – |
| Operating (loss)/profit, nine months ended September 27, 2026GAAP | −$318M | – | (163.9) % |
| Net (loss)/income attributable to Sonoco, nine months ended September 27, 2026GAAP | −$560M | – | (183.4) % |
| EPS (diluted), nine months ended September 27, 2026GAAP | $(5.63) | – | (183.5) % |
| Adjusted operating profit, nine months ended September 27, 2026non-GAAP | $711M | – | (7.4) % |
| Adjusted EBITDA, nine months ended September 27, 2026non-GAAP | $952M | – | (9.5) % |
| Adjusted net income attributable to Sonoco, nine months ended September 27, 2026non-GAAP | $437M | – | (5.8) % |
| Adjusted EPS (diluted), nine months ended September 27, 2026non-GAAP | $4.38 | – | (6.0) % |
| Cash flow from operating activities, nine months ended September 27, 2026GAAP | $218M | – | – |
| Capital expenditures, net of proceeds from sales of fixed assets, nine months ended September 27, 2026GAAP | $175M | – | – |
| Free Cash Flow, nine months ended September 27, 2026non-GAAP | $43M | – | – |
| Effective tax rate on GAAP income from continuing operations before income taxes, three months ended September 27, 2026GAAP | (6.4)% | – | – |
| Effective tax rate on adjusted income from continuing operations before income taxes, three months ended September 27, 2026non-GAAP | 24.6% | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Consumer Packaging, three months ended September 27, 2026Adverse weather conditions impacted seasonal vegetable harvests in EMEA and Americas, reducing metal cans volumes. This more than offset pricing actions implemented to recover inflation and tariff-related costs and the negative impact of foreign exchange. | $1.40B | – | (2.9) % |
| Industrial Paper Packaging, three months ended September 27, 2026Net sales increased primarily due to successful pricing actions implemented to help offset rising costs. | $646M | – | 5.2 % |
| Consumer Packaging, nine months ended September 27, 2026Segment operating profit and adjusted EBITDA declined as strong productivity savings and cost containment actions were more than offset by inflation-driven price/cost headwinds and negative volume/mix. | $3.73B | – | 0.1 % |
| Industrial Paper Packaging, nine months ended September 27, 2026Pricing actions and productivity initiatives were more than offset by rising raw material, freight and energy costs. | $1.87B | – | 2.7 % |
Revised Full-Year 2026 outlook
- Revenue$7.20 billion to $7.40 billion
- NoteAdjusted EPS: Targeting diluted earnings per share between $5.30 to $5.50
- NoteAdjusted EBITDA: Targeting $1.20 billion to $1.25 billion
- NoteCash flow from operating activities: Guidance adjusted to $600 million to $650 million, including the effect of payments of prior year taxes on gains from divestitures and restructuring costs
Capital returns
- The Company returned $159 million to shareholders through dividends during the first nine months of 2026, compared to $156 million in the prior year period.
- Cash dividends were $159,182 thousand for the nine months ended September 27, 2026, compared to $155,767 thousand for the nine months ended September 28, 2025.
- Payments for share repurchases were $7,192 thousand for the nine months ended September 27, 2026, compared to $10,580 thousand for the nine months ended September 28, 2025.
- Dividends per common share were $0.54 for the three months ended September 27, 2026, compared to $0.53 for the three months ended September 28, 2025.
- Dividends per common share were $1.61 for the nine months ended September 27, 2026, compared to $1.58 for the nine months ended September 28, 2025.
What drove it
- Third-quarter net sales were driven lower primarily by the November 3, 2025 divestiture of the ThermoSafe business.
- Higher selling prices implemented to offset inflation and tariffs benefited sales but were partially offset by lower volume/mix.
- The GAAP operating loss included non-cash goodwill impairment charges of $(802) million and $(27) million attributable to Consumer Packaging EMEA/APAC businesses and Industrial Paper Packaging APAC business, respectively.
- North America URB trade ton sales increased 10% year over year and mill utilization remained strong at 94%.
- International paper can operations delivered double-digit volume growth year over year, driven by sustained demand for snack products across emerging markets.
- The Company cited productivity savings from fixed-cost reduction initiatives, procurement savings and cost containment actions.
Concerns
- Drought conditions across parts of Europe and the U.S. impacted crop yields and pressured food can demand.
- Inflation on raw materials, freight, energy and other operating costs exceeded the Company's expectations.
- Consumer Packaging volume/mix declined 3% year over year due primarily to adverse weather conditions and unfavorable price/cost dynamics.
- Consumer segment operating profit was $179 million, compared with $209 million, while segment adjusted EBITDA was $237 million, compared with $260 million.
- Industrial segment operating profit was $88 million, compared with $94 million, while segment adjusted EBITDA was $122 million, compared with $127 million.
- The Company recorded a total non-cash goodwill impairment charge of $(829) million in the third quarter.
What to watch
- Fourth-quarter Industrial performance, supported by continued robust URB demand in North America.
- Consumer performance, including international paper can growth and a more balanced performance in aerosol and food can volumes.
- Progress on recovering raw material, freight, energy and other operating costs.
- Actions under the Profitability Performance Plan to reduce costs and improve productivity.
- Full-year delivery against revised guidance of $7.20 billion to $7.40 billion in net sales, adjusted EPS of $5.30 to $5.50, adjusted EBITDA of $1.20 billion to $1.25 billion, and cash flow from operating activities of $600 million to $650 million.
Balance sheet and cash flow
- Cash and cash equivalents were $183 million as of September 27, 2026, compared to $378 million as of December 31, 2025.
- Total debt and net debt were $4.3 billion and $4.1 billion, respectively, as of September 27, 2026.
- The Company maintained liquidity of $1.3 billion at September 27, 2026, consisting of $1.1 billion of available borrowing capacity under its revolving credit facility and cash on hand.
- Total Debt was $4,291,666 thousand and Net Debt was $4,108,565 thousand as of September 27, 2026.
- Net cash provided by operating activities was $217,548 thousand for the nine months ended September 27, 2026, compared to $276,896 thousand for the nine months ended September 28, 2025.
- On September 25, 2026, Sonoco amended a credit agreement, resulting in the addition of $800 million in new term loan facilities. The Company drew $500 million from the new facilities to refinance an existing $500 million term loan which was to mature in 2028, and retained $300 million in delayed-draw term loan capacity.
Analysis
Sonoco reported third-quarter net sales of $2,042 million, down (4.2) % from $2,131 million. The Company said the November 3, 2025 ThermoSafe divestiture was the primary driver, while higher selling prices implemented for inflation and tariffs were partly offset by lower volume/mix. For the first nine months, net sales were $5,604 million, down (2.6) % from $5,751 million.
The quarter was marked by a $829 million non-cash goodwill impairment charge related to Consumer Packaging EMEA/APAC and Industrial Paper Packaging APAC. This contributed to GAAP operating loss of $(638) million and net loss attributable to Sonoco of $(732) million, or $(7.36) diluted EPS, versus operating profit of $195 million and net income of $123 million, or $1.23 per diluted share. Excluding adjustments, adjusted operating profit was $268 million, adjusted EBITDA was $352 million, adjusted net income was $167 million and adjusted diluted EPS was $1.67, all below the prior-year quarter.
Consumer Packaging remained the principal operating pressure point. Third-quarter segment sales declined (2.9) % to $1,396 million as adverse weather reduced metal-can volumes in EMEA and the Americas, with foreign exchange also negative. Segment operating profit was $179 million and segment adjusted EBITDA was $237 million, below $209 million and $260 million, respectively. Industrial Paper Packaging produced 5.2 % sales growth to $646 million on pricing actions, but segment operating profit and adjusted EBITDA declined to $88 million and $122 million as raw material, freight and energy costs exceeded the benefit of pricing and productivity.
Cash generation was a relative strength. The Company generated operating cash flow of $285 million in the quarter. Nine-month cash flow from operating activities was $218 million, versus $277 million, including approximately $103 million in one-time taxes related to gains on the 2025 TFP and ThermoSafe divestitures. Nine-month free cash flow improved to $43 million from $29 million as net capital expenditures were $175 million versus $248 million. The Company returned $159 million through dividends during the first nine months and reported cash and cash equivalents of $183 million, total debt of $4.3 billion and net debt of $4.1 billion at September 27, 2026.
Management revised full-year 2026 guidance to net sales of $7.20 billion to $7.40 billion, adjusted EPS of $5.30 to $5.50, adjusted EBITDA of $1.20 billion to $1.25 billion and cash flow from operating activities of $600 million to $650 million. The fourth-quarter outlook calls for continued strength in Industrial, backed by North American URB demand, and more stable Consumer results through international paper-can growth and a more balanced performance in aerosol and food-can volumes. Cost recovery for raw materials, freight, energy and other operating costs remains a stated priority.
Management, verbatim
During the third quarter, our businesses faced a combination of external challenges. Drought conditions across parts of Europe and the U.S. impacted crop yields and pressured food can demand, while the impact of inflation on raw materials, freight, energy, and other operating costs exceeded our expectations. Through strong productivity initiatives and rigorous cost control, our teams were able to mitigate a significant portion of this impact and deliver resilient operating results.
Howard Coker, President and Chief Executive Officer
Results in Consumer Packaging fell short of expectations, as volume/mix declined 3% year over year due primarily to adverse weather conditions and unfavorable price/cost dynamics. Encouragingly, international paper can operations performed well, with double-digit volume growth year over year driven by sustained demand for snack products across emerging markets.
Howard Coker, President and Chief Executive Officer
Our businesses once again generated strong operating cash flow in the third quarter, delivering $285 million despite seasonal working capital headwinds. Year-to-date operating cash flow includes $103 million of one-time tax payments related to gains on our 2025 divestitures. We continued to strengthen our balance sheet during the quarter, reducing total debt and net debt by $162 million and $176 million, respectively, while successfully refinancing an $800 million term loan.
Paul Joachimczyk, Chief Financial Officer
Not in the filing
stated, not guessed- Prior-period outlook was not provided, so comparison of actual results with prior guidance is unavailable.
- Quarterly gross margin was not reported.
- Nine-month gross margin was not reported.
- Quarterly free cash flow was not reported.
- Quarterly capital expenditures were not reported.
- Full-year 2026 GAAP guidance was not provided.
- Full-year 2026 gross margin, operating expenses and tax-rate guidance were not provided.
- Prior-quarter values for the reported income-statement metrics were not provided.
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.