Graphic Packaging Company (GPK) Q1 2026 earnings summary

Executive summary

• Net sales rose 2% year-over-year to $2.2 billion ($2,156 million), with volumes up 1%, driven by higher volumes and favorable currency, partially offset by lower pricing.

• Adjusted EBITDA was $232 million, margin 10.8%, down 36% year-over-year; adjusted EPS was $0.09, a significant decline from $0.51 in Q1 2025.

• Net loss was $43 million, compared to net income of $127 million in Q1 2025; diluted EPS was $(0.14) versus $0.42 last year.

• Completed a 90-day business review, confirming a strong foundation and advancing strategic priorities, including cost reduction initiatives.

• Significant restructuring included discontinuing automated warehouse projects, workforce reductions of over 500 roles, and further cost optimization initiatives.

Financial highlights

• Net sales increased 2% year-over-year to $2.2 billion, with a $50 million FX benefit, partially offset by a 2% price decline.

• Adjusted EBITDA declined $133 million year-over-year to $232 million, impacted by competitive pricing, cost inflation, and weather-related disruptions.

• Adjusted cash flow was -$183 million, a significant improvement from -$442 million in Q1 2025.

• Inventory reduced by $48 million during the quarter.

• Capital expenditures were $140 million, down from $313 million in Q1 2025.

Outlook and guidance

• Reaffirmed 2026 guidance: net sales of $8.4–$8.6 billion, adjusted EBITDA of $1.05–$1.25 billion, adjusted EPS of $0.75–$1.15, and adjusted cash flow of $700–$800 million.

• Capital expenditures for 2026 expected to be ~$450 million.

• Plan to pay down ~$500 million of debt in 2026 and maintain dividend.

• Q2 adjusted EBITDA expected in the range of $230 million–$250 million, with continued inflationary pressures.

• Year-end net leverage targeted below 4.2x; interest expense $250M–$270M; effective tax rate ~25%.