Graphic Packaging reported nearly flat third-quarter sales but lower earnings, as adjusted EBITDA fell from a year earlier despite a second consecutive quarter of sequential margin expansion. The packaging maker also reported stronger cash flow through September and reaffirmed its full-year 2026 outlook, including a substantially higher cash-flow target than it achieved in 2025.
Key details
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Sales were essentially unchanged. Third-quarter net sales were $2.192 billion, up $2 million from a year earlier. A 1% increase in volume and mix added $19 million, largely offset by a 1% decline in price, which reduced sales by $15 million, and a $2 million unfavorable foreign-exchange and other impact. Volume rose 1%.
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Earnings declined sharply year over year. Net income was $22 million, or 7 cents per diluted share, compared with $142 million, or 48 cents, in the third quarter of 2025. Adjusted net income, which excludes special and non-recurring items and amortization of acquired intangibles, was $67 million, or 23 cents per share, versus $172 million, or 58 cents, a year earlier.
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Adjusted EBITDA also fell. EBITDA was $254 million, down 30% from $361 million. Adjusted EBITDA was $289 million, compared with $383 million in the year-earlier quarter—a $94 million decrease. The company said adjusted EBITDA margin nevertheless expanded sequentially for the second straight quarter; it did not provide a margin figure in the available results excerpt.
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Special charges affected both periods. Net income in the third quarter included $45 million of charges for special and non-recurring items and amortization of acquired intangibles, compared with $30 million a year earlier. Adjusted earnings were also lower, so those charges do not account for the full year-over-year decline.
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Cash flow improved through September. Net cash provided by operating activities for the first nine months of 2026 was $295 million. Adjusted cash flow was $314 million, up $646 million from the same period in 2025. The company said the stronger cash generation, including a significant contribution in the third quarter, enabled it to reduce debt from year-end 2025.
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Full-year targets were reaffirmed. Graphic Packaging expects 2026 net sales of about $8.6 billion, adjusted EBITDA of about $1.05 billion and adjusted earnings per share of about 65 cents. It maintained its adjusted cash-flow outlook of $600 million to $700 million, compared with $169 million in 2025.
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Management pointed to cost and productivity work. CEO Robbert Rietbroek said structural cost reductions and productivity improvements helped the company perform amid elevated inflation. He also said the company expects commercial initiatives and price improvements to contribute in the fourth quarter and into 2027, and described a return to EBITDA growth next year as a goal.
What changes for investors
The quarter showed a contrast between modest sales and volume growth and substantially lower earnings. The higher year-to-date cash flow and debt reduction indicate improved cash generation in 2026 so far, while the company’s reaffirmed outlook calls for a significant increase in full-year adjusted cash flow from 2025.