Packaging Corporation of America (NYSE: PKG) delivered a robust financial performance in the second quarter of 2025, underscoring its leadership in the North American containerboard and paper products industry. The company reported a net income of \(242 million, translating to \)2.67 diluted earnings per share (EPS), marking a significant increase from \(198.9 million and \)2.21 EPS in the same quarter of 2024. Excluding special items, EPS rose by \(0.28 to \)2.48, driven primarily by higher prices and favorable product mix in the Packaging segment, lower fiber costs, and a reduced tax rate.
Net sales for Q2 2025 reached \(2.2 billion, up from \)2.1 billion in Q2 2024, reflecting steady demand despite cautious customer ordering patterns amid ongoing economic uncertainty. The Packaging segment, which constitutes the core of PCA’s business, saw a 1.7% increase in corrugated products shipments per day compared to the prior year, with containerboard production totaling 1,195,000 tons. Containerboard inventory was managed effectively, ending the quarter slightly below the previous quarter’s level, aligning with targeted inventory strategies.
Segment operating income for Packaging surged to \(346.3 million, a 24% increase year-over-year, while the Paper segment maintained profitability with \)25.8 million in operating income despite a 5% decline in sales volume. Corporate and other expenses increased moderately, reflecting acquisition-related costs tied to the pending Greif containerboard business acquisition.
CEO Mark W. Kowlzan emphasized the company’s operational excellence and strategic pricing initiatives, stating, “We operated very well during the quarter, delivering strong earnings and cash flows as well as higher margins in the Packaging segment. Pricing in the Packaging segment was consistent with expectations as we fully realized our earlier announced price increases.”
Looking ahead, PCA anticipates higher corrugated shipments and increased containerboard production in Q3 2025, although export containerboard sales are expected to decline due to global trade challenges. The company plans to build containerboard inventory ahead of a scheduled maintenance outage at its DeRidder mill in Q4. Pricing in both Packaging and Paper segments is expected to remain flat, with operating costs near Q2 levels and slightly lower fiber costs.
Financially, PCA’s EBITDA excluding special items rose to \(450.8 million in Q2 2025, up from \)404.0 million in Q2 2024, reflecting improved operational efficiency and cost management. Capital spending for the first half of 2025 totaled $317.8 million, supporting ongoing capital projects and efficiency initiatives.
This strong quarterly performance aligns with themes from PCA’s previous earnings calls, where management highlighted the importance of pricing discipline, cost control, and strategic capacity management amid economic uncertainties and tariff impacts in the manufacturing sector.
Investors should note that the pending acquisition of Greif’s containerboard business, subject to regulatory approval, may introduce acquisition and integration costs in upcoming quarters but is expected to enhance PCA’s market position.
For a detailed review of Packaging Corporation of America’s Q2 2025 financial results, please refer to the official SEC filing: Source Document.
Tags: PKG, Packaging Corporation of America, Q2 2025, containerboard production, corrugated products shipments, Greif acquisition