INTERNATIONAL PAPER CO /NEW/

Previous wording

Net earnings (loss) were $(105) million ($(0.24) per diluted share) in the first quarter of 2025, compared with $(147) million ($(0.42) per diluted share) in the fourth quarter of 2024 and $56 million ($0.16 per diluted share) in the first quarter of 2024. The Company generated Adjusted operating earnings (a non-GAAP measure defined below) of $101 million ($0.23 per diluted share) in the first quarter of 2025, compared with $(7) million ($(0.02) per diluted share) in the fourth quarter of 2024 and $61 million ($0.17 per diluted share) in the first quarter of 2024.

Current wording

Net earnings (loss) were $75 million ($0.14 per diluted share) in the second quarter of 2025, compared with $(105) million ($(0.24) per diluted share) in the first quarter of 2025 and $498 million ($1.41 per diluted share) in the second quarter of 2024. The Company generated Adjusted operating earnings (a non-GAAP measure defined below) of $105 million ($0.20 per diluted share) in the second quarter of 2025, compared with $101 million ($0.23 per diluted share) in the first quarter of 2025 and $193 million ($0.55 per diluted share) in the second quarter of 2024.

Previous wording

First quarter of 2025 operating profit in our Global Cellulose Fibers business was $17 million versus a $250 million operating loss in the fourth quarter of 2024. Price and mix was higher versus the fourth quarter of 2024 on improved fluff mix and the sale of energy credits. We expect price and mix to be higher in the second quarter of 2025 on continued price realization from prior index movement. Volume was sequentially flat in the first quarter of 2025, and we expect the second quarter of 2025 to remain flat relative to the first quarter of 2025. Operations and costs were sequentially lower in the first quarter of 2025 due to improved mill performance and lower costs associated with employee incentive compensation. We expect second quarter of 2025 operations and costs to be flat compared to the first quarter of 2025. Planned maintenance outage costs were sequentially higher in the first quarter of 2025. Second quarter of 2025 is expected to be higher as one maintenance outage was moved to the second quarter which will drive higher costs relative to the first quarter of 2025. Finally, first quarter of 2025 depreciation and amortization was lower on the non-repeat of accelerated depreciation expense associated with the Georgetown, South Carolina mill closure in the fourth quarter of 2024.

Current wording

Second quarter of 2025 operating loss in our Global Cellulose Fibers business was $4 million versus operating profit of $17 million in the first quarter of 2025. Price and mix was higher versus the first quarter of 2025 on the realization of prior index movements. We expect price and mix to be lower in the third quarter of 2025 on lower price realization from prior index movements and lower energy credits sales compared to the first half of 2025. Volume was sequentially lower in the second quarter of 2025 due to higher maintenance outage activity. We expect volumes to be higher in the third quarter of 2025 in response to lower outage activity in the quarter. Operations and costs were sequentially higher in the second quarter of 2025 due to the timing of spend on turbine maintenance, partially offset by improved mill reliability. We expect improved operations and costs in the third quarter on the non-repeat of the second quarter turbine maintenance and continued mill reliability improvement. Planned maintenance outage costs were higher in the second quarter of 2025 as we have now completed 80% of planned outages which will result in lower maintenance outage costs in the third quarter of 2025. Finally, input costs were lower in the second quarter of 2025 on lower energy costs which are expected to increase in the third quarter of 2025. We are pursuing strategic options for our Global Cellulose Fibers business. There is no assurance that this process will result in any transaction or other outcome. See “Item 1A Risk Factors -There are risks associated with our pursuit of strategic options of our Global Cellulose Fibers business, and there is no assurance that this process will result in any transactions or other outcome."

Previous wording

On April 14, 2025, the Company announced it entered into exclusive negotiations with Palm Group of Germany after receiving an irrevocable offer for the purchase of five plants in Europe: (i) three plants in Normandy, France (namely, one box plant in Saint-Amand, one box plant in Mortagne, and one sheet plant in Cabourg); (ii) one box plant in Ovar, Portugal; and (iii) one box plant in Bilbao, Spain. Upon completion of the required French works council consultation and/or employee information processes, the parties expect to enter into a definitive share purchase agreement. The closing is expected by the end of the second quarter of 2025. All assets and liabilities at March 31, 2025 related to these locations have been recorded as held for sale in the accompanying condensed consolidated balance sheet.

Current wording

On June 30, 2025, the Company completed the sale of five corrugated box plants in Europe as part of its remedy package for the previously disclosed acquisition of DS Smith. The divested assets include (i) three plants in Normandy, France (namely, one box plant in Saint-Amand, one box plant in Mortagne, and one sheet plant in Cabourg); (ii) one box plant in Ovar, Portugal; and (iii) one box plant in Bilbao, Spain. The sale of these plants was agreed to with the European Commission as a remedy for IP’s acquisition of DS Smith, as published on the European Commission’s website on January 24, 2025.

Previous wording

On January 31, 2025, the Company completed its acquisition of the entire issued and to be issued share capital of DS Smith. Upon closing, IP issued 0.1285 shares for each DS Smith share, resulting in the issuance of 178,126,631 new shares of IP common stock (“New Company Common Stock”). As a result of the share issuance, the holders of the New Company Common Stock owned approximately 34.1% of the Company’s outstanding share capital upon closing. Based on the issuance of 178,126,631 new shares and the closing price of $55.63 on the close of January 31, 2025, the total purchase consideration for the completed acquisition was approximately $9.9 billion.

Current wording

This divestiture follows the Company’s acquisition of DS Smith, which closed on January 31, 2025. As part of the transaction, IP issued 0.1285 shares for each DS Smith share, resulting in the issuance of approximately 178 million new shares of IP common stock. Holders of these shares owned roughly 34.1% of the Company’s outstanding share capital post-closing. The total purchase consideration was approximately $9.9 billion, based on the closing share price of $55.63. Subsequently, on February 4, 2025, the new shares began trading under the symbol “IP” on the New York Stock Exchange and under “IPC” on the London Stock Exchange via a secondary listing. The combined Company’s global headquarters remains in Memphis, Tennessee, with its EMEA headquarters established at DS Smith’s London office.

Previous wording

(a) For the three months ended March 31, 2025, this amount includes a tax benefit of $1 million on the non-operating pension expense and a tax benefit of $45 million associated with special items. The three months ended March 31, 2024 includes tax expense of $3 million on the non-operating pension income and a tax benefit of $4 million associated with special items. The three months ended December 31, 2024 includes tax expense of $2 million on the non-operating pension income and a tax benefit of $36 million associated with special items.

Current wording

(a) For the three months ended June 30, 2025, this amount includes a tax expense of $1 million on the non-operating pension expense and a tax benefit of $1 million associated with special items. The three months ended June 30, 2024 include a tax benefit of $338 million related to internal legal entity restructuring. This amount also includes a tax expense of $2 million on the non-operating pension incomes and a tax benefit of $8 million associated with special items. The three months ended March 31, 2025 includes a tax benefit of $1 million on the non-operating pension expense and a tax benefit of $45 million associated with special items.

Previous wording

Free cash flow is a non-GAAP measure, which equals cash provided by operations less capital expenditures, and the most directly comparable GAAP measure is cash provided by (used for) operations. Management utilizes this measure in connection with managing our business and believes that free cash flow is useful to investors as a liquidity measure because it measures the amount of cash generated that is available, after reinvesting in the business, to maintain a strong balance sheet, pay dividends, repurchase stock, service debt and make investments for future growth. It should not be inferred that the entire free cash flow amount is available for discretionary expenditures.

Current wording

Cash provided by (used for) operations totaled $188 million and $760 million for the first six months of 2025 and 2024, respectively. Free cash flow in the first six months of 2025 and 2024 was $(564) million and $311 million, respectively. Free cash flow is a non-GAAP measure, which equals cash provided by operations less capital expenditures, and the most directly comparable GAAP measure is cash provided by (used for) operations. Management utilizes this measure in connection with managing our business and believes that free cash flow is useful to investors as a liquidity measure because it measures the amount of cash generated that is available, after reinvesting in the business, to maintain a strong balance sheet, pay dividends, repurchase stock, service debt and make investments for future growth. It should not be inferred that the entire free cash flow amount is available for discretionary expenditures.

Previous wording

The following summarizes our results of operations for first quarter of 2025 compared with the fourth quarter of 2024 and the first quarter of 2024:

Current wording

The following summarizes our results of operations for second quarter of 2025 compared with the first quarter of 2025 and the second quarter of 2024:

Previous wording

The increase in the first quarter of 2025 compared to the fourth quarter of 2024 and the first quarter of 2024 was primarily driven by the addition of the newly acquired DS Smith business as a result of the completed acquisition in the first quarter of 2025. Additional details on net sales are provided in the Business Segment Operating Results section below.

Current wording

The increase in the second quarter of 2025 compared to the first quarter of 2025 and the second quarter of 2024 was primarily driven by the addition of the DS Smith business and the three months of activity in the second quarter of 2025 compared to two months of activity in the first quarter of 2025. Additional details on net sales are provided in the Business Segment Operating Results section below.

Previous wording

Net special items charges of $70 million, $15 million and $35 million in the first quarter of 2025 and 2024 and the fourth quarter of 2024, respectively, are included in cost of products sold. The first quarter of 2025 includes $1.09 billion for DS Smith (including $70 million of special items charges). Compared to the fourth quarter of 2024, there were decreases of $93 million in raw materials, offset by increases of $54 million in fuel expense. Compared to the first quarter of 2024, cost of products sold was impacted by $320 million for decreases in raw materials and increases in insurance recoveries and one-time energy credits received, offset by lower maintenance and fuel expenses of $86 million.

Current wording

Net special items charges of $25 million and $70 million in the second quarter of 2024 and the first quarter of 2025, respectively, are included in cost of products sold. The second quarter of 2025 includes $1.6 billion for DS Smith and the first quarter of 2025 includes $1.09 billion for DS Smith (including $70 million of special items charges). Cost of products sold includes three months of DS Smith activity in the second quarter of 2025 compared to two months in the first quarter of 2025. For legacy IP, compared to the first quarter of 2025, there were increases of $55 million in raw materials and $109 million in maintenance and labor expense, offset by decreases of $52 million in fuel and other expenses. Compared to the second quarter of 2024, cost of products sold was impacted by decreases in raw materials and operating materials of $218 million, offset by an increase of $182 million in maintenance and fuel expense.

Previous wording

Net special items charges of $113 million, $5 million and $43 million in the first quarter of 2025 and 2024 and the fourth quarter of 2024, respectively, are included in selling and administrative expenses. The first quarter of 2025 includes $123 million for DS Smith (including $49 million of special items charges). Compared to the fourth quarter of 2024, there were decreases in incentive compensation and medical benefit costs. Compared to the first quarter of 2024, there were decreases in medical benefit costs offset by incentive compensation and other costs.

Current wording

Net special items charges of $47 million, $29 million and $113 million in the second quarter of 2025 and 2024 and the first quarter of 2025, respectively, are included in selling and administrative expenses. The second quarter of 2025 includes $144 million for DS Smith (including $15 million of special items charges) and the first quarter of 2025 includes $123 million for DS Smith (including $49 million of special items charges). Selling and administrative expenses includes three months of DS Smith activity in the second quarter of 2025 compared to two months in the first quarter of 2025. For legacy IP, compared to the first quarter of 2025, there were increases in incentive compensation of $10 million and medical benefit costs of $15 million. Compared to the second quarter of 2024, there were decreases in medical benefit costs of $10 million and incentive compensation of $45 million.

Previous wording

Net special items charges of $50 million in the first quarter of 2025 are included in taxes other than payroll and income taxes. The first quarter of 2025 includes $5 million for DS Smith.

Current wording

Net special items charges of $50 million in the first quarter of 2025 are included in taxes other than payroll and income taxes. The second quarter of 2025 includes $10 million compared to $5 million in the first quarter of 2025 for DS Smith. For legacy IP, taxes other than payroll and income taxes includes three months of DS Smith activity in the second quarter of 2025 compared to two months in the first quarter of 2025.

Previous wording

An income tax provision of $27 million was recorded for the first quarter of 2024 and the reported effective income tax rate was 32%. Excluding a benefit of $4 million related to the tax effects of net special items and expense of $3 million related to the tax effects of non-operating pension income, the operational effective income tax rate was 31% for the first quarter of 2024. The operational and reported effective income tax rates were lower in the first quarter of 2025 than in the first quarter of 2024 primarily due to a tax benefit for equity-based compensation in the first quarter of 2025 and a tax expense for equity-based compensation in the first quarter of 2024.

Current wording

An income tax benefit of $31 million was recorded for the first quarter of 2025 and the reported effective income tax rate was 23%. Excluding a benefit of $45 million related to the tax effects of net special items and benefit of $1 million related to the tax effects of non-operating pension expense, the operational effective income tax rate was 13% for the first quarter of 2025. The operational and reported effective income tax rates were higher in the second quarter of 2025 than in the first quarter of 2025 primarily due to decreased tax expense related to equity-based compensation that occurred in the first quarter.

Previous wording

An income tax benefit of $78 million was recorded for the fourth quarter of 2024 and the reported effective income tax rate was 35%. Excluding a benefit of $36 million related to the tax effects of net special items and expense of $2 million related to the tax effects of non-operating pension income, the operational effective income tax rate was 88% for the fourth quarter of 2024. The operational and reported effective income tax rates were lower in the first quarter of 2025 than in the fourth quarter of 2024 primarily due to the timing and magnitude of the accelerated depreciation expense recorded in the fourth quarter of 2024 associated with the closure of the Georgetown, South Carolina mill.

Current wording

An income tax benefit of $293 million was recorded for the second quarter of 2024 and the reported effective income tax rate was (142)%. Excluding a benefit of $346 million related to the tax effects of net special items and expense of $2 million related to the tax effects of non-operating pension income, the operational effective income tax rate was 21% for the second quarter of 2024.

Previous wording

The operational income tax provision and operational effective income tax rate are non-GAAP financial measures and are calculated by adjusting the income tax provision from continuing operations and rate to exclude the tax effect of net special items and non-operating pension expense (income). The most directly comparable GAAP measures are the reported income tax provision and effective income tax rate, respectively. Management believes that this presentation provides useful information to investors by providing a meaningful comparison of the income tax rate between past and present periods.

Current wording

The operational income tax provision and operational effective income tax rate are non-GAAP financial measures and are calculated by adjusting the earnings (loss) before income taxes and equity earnings (loss), income tax provision (benefit) and rate to exclude net special items and non-operating pension expense (income). The most directly comparable GAAP measures are the reported income tax provision and effective income tax rate, respectively. Management believes that this presentation provides useful information to investors by providing a meaningful comparison of the income tax rate between past and present periods.

Previous wording

The Company currently operates in three segments: Packaging Solutions North America, Packaging Solutions EMEA and Global Cellulose Fibers.

Current wording

The Company currently operates in three segments: Packaging Solutions North America (PS NA), Packaging Solutions EMEA (PS EMEA) and Global Cellulose Fibers.

Previous wording

The following tables present net sales and business segment operating profit (loss), which is the Company's measure of segment profitability. Business segment operating profit (loss) is a measure reported to our management for purposes of making decisions about allocating resources to our business segments and assessing the performance of our business segments and is presented in our financial statement footnotes in accordance with ASC 280 - "Segment Reporting". For additional information regarding business segment operating profit (loss), including a description of the manner in which business segment operating profit (loss) is calculated, see Note 19 - Business Segment Information of the Condensed Notes to the Consolidated Financial Statements.

Current wording

The following tables present net sales and business segment operating profit (loss), which is the Company's measure of segment profitability. Business segment operating profit (loss) is a measure reported to our management for purposes of making decisions about allocating resources to our business segments and assessing the performance of our business segments and is presented in our financial statement footnotes in accordance with ASC 280 - "Segment Reporting." For additional information regarding business segment operating profit (loss), including a description of the manner in which business segment operating profit (loss) is calculated, see Note 19 - Business Segment Information to the Condensed Notes to the Consolidated Financial Statements.

Previous wording

Packaging Solutions North America results include sales of $127 million and business segment operating profit (loss) of $(9) million for the DS Smith business in the first quarter of 2025. For legacy IP Packaging Solutions North America, sales were higher compared to the fourth quarter of 2024 driven by higher average sales prices reflecting prior index movements and the benefits of our box go-to-market strategy, partially offset by seasonally lower volumes. Cost of products sold increased by $7 million and was impacted by higher costs on goods and services. Planned maintenance downtime costs were lower in the first quarter of 2025 compared with the fourth quarter of 2024. Input costs were higher driven by higher energy costs. Selling and administrative expenses decreased by $97 million driven by lower employee incentive compensation and medical benefit expenses. Depreciation and amortization expense increased by $193 million driven by accelerated depreciation recorded in the first quarter of 2025 related to the announced closure of the Red River containerboard mill in Campti, LA. Business segment operating profit benefited from the receipt of a $30 million insurance reimbursement in the first quarter of 2025 and $13 million in the fourth quarter of 2024 related to the Ixtac, Mexico box plant fire in the first quarter of 2024.

Current wording

PS NAresults include sales of $173 million and business segment operating profit (loss) of $(33) million for the legacy DS Smith North America business in the second quarter of 2025 compared with sales of $127 million and business segment operating profit (loss) of $(9) million in the first quarter of 2025. The financial results of the PS NA segment include three months in the second quarter compared with two months in the first quarter for the DS Smith North America business. For legacy IP PS NA, sales were higher compared to the first quarter of 2025 driven by higher average sales prices for boxes and export containerboard reflecting prior index movements and seasonally higher box volumes. Cost of products sold increased by $84 million and was impacted by higher manufacturing costs, including planned maintenance downtime costs, partially offset by lower input costs. Depreciation and amortization expense decreased by $196 million driven by the non-repeat of $193 million of accelerated depreciation associated with the previously announced closure of our Red River containerboard mill in Campti, Louisiana. Selling and administrative expenses increased by $55 million driven by higher overhead costs, including the non-repeat of favorable employee medical costs in the first quarter of 2025.

Previous wording

Compared with the first quarter of 2024, IP legacy Packaging Solutions North America sales in the first quarter of 2025 were higher driven by higher sales prices, partially offset by lower sales volumes reflecting the impact of our box go-to-market strategy. Cost of products sold decreased by $23 million and was impacted by lower sales volumes. Operating costs increased, driven by increased costs on goods and services, reliability incidents and maintenance spending. Planned maintenance downtime costs were higher in the first quarter of 2025 compared with the first quarter of 2024. Input costs were higher driven by energy costs. Selling and administrative expenses decreased $6 million and was impacted by lower employee medical benefit expenses. Depreciation and amortization expense increased $194 million driven by the accelerated deprecation related to the Red River mill closure. Distribution expense decreased by $35 million and was impacted by lower sales volumes. The first quarter of 2025 benefited from the receipt of the $30 million insurance reimbursement related to the Ixtac, Mexico box plant fire.

Current wording

Compared with the second quarter of 2024, IP legacy PS NA sales in the second quarter of 2025 were higher driven by higher sales prices, partially offset by lower sales volumes reflecting the impact of our box go-to-market strategy. Cost of products sold increased by $12 million as the impact of higher manufacturing costs, including planned maintenance downtime costs and input costs, was partially offset by lower sales volumes. Selling and administrative expenses increased by $17 million and was impacted by higher overhead costs. Distribution expense decreased by $17 million and was impacted by lower sales volumes.

Previous wording

Entering the second quarter of 2025, sales volumes are expected to be seasonally higher compared to the first quarter of 2025. Sales are also expected to be impacted by prior index movements. Operating costs are expected to be higher. Planned maintenance downtime costs are expected to be higher in the second quarter of 2025 compared with the first quarter of 2025. Input costs are expected to be lower driven by energy and fiber costs. The second quarter of 2025 will include one additional month of DS Smith sales and business segment operating profit compared to the first quarter of 2025.

Current wording

Entering the third quarter of 2025, sales volumes are expected to be seasonally higher compared to the second quarter of 2025. Sales are also expected to be impacted by prior index movements. Operating costs are expected to be lower. Planned maintenance downtime costs are expected to be lower in the third quarter of 2025 compared with the second quarter of 2025. Input costs are expected to be higher driven by energy costs.

Previous wording

Looking ahead to the second quarter of 2025, sales are expected to be higher, reflecting one additional month of DS Smith sales partially offset by seasonally lower volumes. Operating costs are expected to be higher. Input costs are expected to be lower, driven by energy costs. Planned maintenance downtime costs are expected to be higher in the second quarter of 2025. The second quarter of 2025 will include one additional month of DS Smith business segment operating profit compared to the first quarter of 2025.

Current wording

Looking ahead to the third quarter of 2025, sales are expected to be higher. Operating costs are expected to be lower. Input costs are expected to be lower, driven by fiber costs. Planned maintenance downtime costs are expected to be higher in the third quarter of 2025.

Previous wording

Global Cellulose Fibers sales were lower, reflecting lower sales prices from prior index movements and lower sales volumes driven by the mill strategic actions taken in the fourth quarter of 2024, partially offset by a favorable product mix. Cost of products sold decreased by $25 million and was impacted by improved mill reliability and lower economic downtime. Planned maintenance downtime costs in the first quarter of 2025 were higher compared with the fourth quarter of 2024. Input costs were higher as higher energy costs were partially offset by lower chemical and wood costs. Selling and administrative expenses decreased $31 million driven by lower employee incentive compensation and medical benefit expenses. Depreciation and amortization expense was $228 million lower as the fourth quarter of 2024 included $215 million of accelerated depreciation related to the closure of the Georgetown, South Carolina mill.

Current wording

Global Cellulose Fibers sales were lower for the second quarter of 2025 compared with the first quarter of 2025, as higher sales prices from prior index movements were more than offset by lower volumes driven by the heavy outage quarter. Cost of products sold was slightly lower and was impacted by lower sales volumes and lower energy costs offset by planned maintenance downtime costs. Selling and administrative expenses increased $13 million driven by higher overhead costs, including the non-repeat of favorable employee medical costs in the first quarter of 2025. Distribution costs were lower reflecting lower sales volumes.

Previous wording

Compared with the first quarter of 2024, sales in the first quarter of 2025 were lower, as higher average sales prices and an improved product mix were more than offset by lower commodity volumes driven by the mill strategic actions taken in the fourth quarter of 2024. Cost of products sold decreased $90 million and was impacted by lower sales volumes and lower planned maintenance downtime costs partially offset by higher input costs, primarily for energy costs. Selling and administrative expense was $15 million lower and was impacted by lower employee medical costs. Distribution costs were $15 million lower reflecting lower sales volumes.

Current wording

Compared with the second quarter of 2024, sales in the second quarter of 2025 were lower, as higher average sales prices and an improved product mix were more than offset by lower commodity volumes driven by the mill strategic actions taken in the fourth quarter of 2024. Cost of products sold decreased $25 million and was impacted by lower sales volumes partially offset by higher planned maintenance downtime costs. Selling and administrative expense was $5 million lower driven by lower overhead costs. Distribution costs were $13 million lower reflecting lower sales volumes.

Previous wording

Entering the second quarter of 2025, sales volumes are expected to be stable. Planned maintenance downtime costs in the second quarter of 2025 are expected to be higher compared with the first quarter of 2025. Operating costs are expected to be stable. Input costs are expected to be lower driven by energy costs.

Current wording

Entering the third quarter of 2025, sales are expected to be lower. Planned maintenance downtime costs in the third quarter of 2025 are expected to be lower compared with the second quarter of 2025. Operating costs are expected to be lower. Input costs are expected to be higher driven by energy costs.

Previous wording

Cash provided by (used for) operations totaled $(288) million and $395 million for the first three months of 2025 and 2024, respectively. Cash provided by (used for) working capital components (accounts receivable, contract assets and inventory less accounts payable and accrued liabilities, interest payable and other) totaled $(622) million for the three months ended March 31, 2025 compared with cash provided by (used for) working capital components of $32 million for the three months ended March 31, 2024. The first quarter of 2025 cash used for operations includes certain significant payments that, in total, impacted operating cash flow by $670 million. This includes approximately $80 million of severance payments and approximately $240 million of DS Smith related transaction costs. This amount also includes the cash impact from the 2024 incentive compensation and other benefit payments made in the first quarter of 2025.

Current wording

Cash provided by (used for) operations totaled $188 million and $760 million for the first six months of 2025 and 2024, respectively. Cash provided by (used for) working capital components (accounts receivable, contract assets and inventory less accounts payable and accrued liabilities, interest payable and other) totaled $(683) million for the six months ended June 30, 2025 compared with cash provided by (used for) working capital components of $12 million for the six months ended June 30, 2024. The change in cash provided by operations in the first six months of 2025 compared to the comparable 2024 six-month period was primarily due to significant payments made in the first quarter of 2025 that impacted operating cash flow by approximately $670 million, including $240 million of DS Smith transaction costs and $80 million of severance payments, as well as incentive compensation and other benefit payments.

Previous wording

Cash provided by (used for) investment activities totaled $237 million in the first three months of 2025 compared with $(247) million in the first three months of 2024. The increase in cash provided by investment activities is mainly due to proceeds from the sale of fixed assets of $83 million, proceeds from insurance recoveries of $28 million and net cash acquired from acquisitions of $415 million, offset by higher capital expenditures of $79 million.

Current wording

Cash provided by (used for) investment activities totaled $(38) million in the first six months of 2025 compared with $(446) million in the first six months of 2024. The increase in cash provided by investment activities is mainly due to proceeds from the sale of fixed assets of $89 million, proceeds from divestitures, net of transaction costs of $138 million, proceeds from insurance recoveries of $28 million and net cash acquired from acquisitions of $419 million, offset by higher capital expenditures of $303 million.

Previous wording

Capital expenditures totaled $330 million in the first three months of 2025, compared to $251 million in the first three months of 2024. Full-year 2025 capital expenditures are currently expected to be approximately $1.8 billion to $1.9 billion, or 100% to 106% of depreciation and amortization.

Current wording

Capital expenditures totaled $752 million in the first six months of 2025, compared to $449 million in the first six months of 2024. Full-year 2025 capital expenditures are currently expected to be approximately $1.8 billion to $1.9 billion, or 90% to 95% of depreciation and amortization.

Previous wording

Financing activities for the first three months of 2025 included a $233 million net increase in debt versus a $3 million net decrease in debt during the comparable 2024 three-month period.

Current wording

Financing activities for the first six months of 2025 included a $200 million net increase in debt versus a $8 million net decrease in debt during the comparable 2024 six-month period.

Previous wording

During the first quarter of 2025, the Company borrowed $175 million under its commercial paper program and $64 million under its committed bank facility.

Current wording

During the second quarter of 2025, the Company had no borrowings outstanding under its commercial paper program and its USD denominated committed bank facility.

Previous wording

See Note 15 - Debt of the Condensed Notes to the Consolidated Financial Statements for a discussion of various debt-related actions taken by the Company during the three months ended March 31, 2025.

Current wording

See Note 15 - Debt to the Condensed Notes to the Consolidated Financial Statements for a discussion of various debt-related actions taken by the Company during the six months ended June 30, 2025.

Previous wording

At March 31, 2025, International Paper’s USD denominated credit facilities totaled $1.9 billion, which is comprised of the $1.4 billion contractually committed bank credit agreement and up to $500 million under the receivables securitization program. Management believes that the Company's credit agreements are adequate to cover expected operating cash flow variability during the current economic cycle. The credit agreements generally provide for interest rates at a floating rate index plus a pre-determined margin dependent upon International Paper’s credit rating. At March 31, 2025, the Company had no borrowings outstanding under the $1.4 billion credit agreement or the $500 million receivables securitization program. The Company’s credit agreements are not subject to any restrictive covenants other than the financial covenants as disclosed in Note 15 - Debt, and the borrowings under the receivables securitization program being limited by eligible receivables. The Company was in compliance with all its debt covenants at March 31, 2025, and was well below the thresholds stipulated under the covenants as defined in the credit agreements. The financial covenants do not restrict any borrowings under the credit agreements.

Current wording

At June 30, 2025, International Paper’s USD denominated credit facilities totaled $1.9 billion, which is comprised of the $1.4 billion contractually committed bank credit agreement and up to $500 million under the receivables securitization program. Management believes that the Company's credit agreements are adequate to cover expected operating cash flow variability during the current economic cycle. The credit agreements generally provide for interest rates at a floating rate index plus a pre-determined margin dependent upon International Paper’s credit rating. At June 30, 2025, the Company had no borrowings outstanding under the $1.4 billion credit agreement or the $500 million receivables securitization program. The Company’s credit agreements are not subject to any restrictive covenants other than the financial covenants as disclosed in Note 15 - Debt to the Condensed Notes to the Consolidated Financial Statements, and the borrowings under the receivables securitization program being limited by eligible receivables. The Company was in compliance with all its debt covenants at June 30, 2025, and was well below the thresholds stipulated under the covenants as defined in the credit agreements. The financial covenants do not restrict any borrowings under the credit agreements.

Previous wording

In addition to the $1.4 billion capacity under the Company's credit agreements, International Paper has a commercial paper program with a borrowing capacity of $1.0 billion supported by its $1.4 billion credit agreement. Under the terms of the program, individual maturities on borrowings may vary, but not exceed one year from the date of issue. Interest bearing notes may be issued either as fixed or floating rate notes. As of March 31, 2025, the Company had $175 million of borrowings outstanding under the commercial paper program.

Current wording

In addition to the $1.4 billion capacity under the Company's credit agreements, International Paper has a commercial paper program with a borrowing capacity of $1.0 billion supported by its $1.4 billion credit agreement. Under the terms of the program, individual maturities on borrowings may vary, but not exceed one year from the date of issue. Interest bearing notes may be issued either as fixed or floating rate notes. As of June 30, 2025, the Company had no borrowings outstanding under the commercial paper program.

Previous wording

In March 2025, the Company amended and restated its £1.25 billion credit facility agreement to, among other things (i) replace its obligation to prepare audited and unaudited consolidated accounts and instead provide International Paper’s account information, on the same terms as International Paper’s existing credit facilities, (ii) amend the financial covenant in the credit facility agreement to align with financial covenants given by International Paper in its existing credit facilities, (iii) amend certain events of default, and undertakings to align more closely with certain equivalent provisions included in the documentation relating to the existing financings of International Paper and to allow additional flexibility for potential reorganization of DS Smith’s subsidiaries, if required, now that DS Smith and its subsidiaries are part of the International Paper group. The multi-currency credit facility allows for GBP, EUR and USD borrowings and provides for interest rates at a floating rate index plus a pre-determined margin. Credit facility borrowings are denominated in the currency that aligns with the Company's cashflows. At March 31, 2025, the Company had €840 million (approximately $909 million at the current exchange rate) borrowings outstanding under the credit facility. The Company’s credit facility agreement is not subject to any restrictive covenants other than that International Paper must comply with the same negative covenants as per its existing credit facilities. IP was in compliance with all its debt covenants at March 31, 2025, and was well below the thresholds stipulated under the covenants as defined in the credit facility agreement. Further the financial covenants do not restrict any borrowings under the credit facility agreement.

Current wording

In March 2025, the Company amended and restated its £1.25 billion credit facility agreement to, among other things (i) replace its obligation to prepare audited and unaudited consolidated accounts and instead provide International Paper’s account information, on the same terms as International Paper’s existing credit facilities, (ii) amend the financial covenant in the credit facility agreement to align with financial covenants given by International Paper in its existing credit facilities, (iii) amend certain events of default, and undertakings to align more closely with certain equivalent provisions included in the documentation relating to the existing financings of International Paper and to allow additional flexibility for potential reorganization of DS Smith’s subsidiaries, if required, now that DS Smith and its subsidiaries are part of the International Paper group. The multi-currency credit facility allows for GBP, EUR and USD borrowings and provides for interest rates at a floating rate index plus a pre-determined margin. Credit facility borrowings are denominated in the currency that aligns with the Company's cashflows. At June 30, 2025, the Company had €970 million (approximately $1.1 billion) borrowings outstanding under the credit facility. The Company’s credit facility agreement is not subject to any restrictive covenants other than that International Paper must comply with the same negative covenants as per its existing credit facilities. IP was in compliance with all its debt covenants at June 30, 2025, and was well below the thresholds stipulated under the covenants as defined in the credit facility agreement. Further the financial covenants do not restrict any borrowings under the credit facility agreement.

Previous wording

In April 2025, the Company amended and restated its credit facility agreement to, among other things (i) replace its obligation to prepare audited and unaudited consolidated accounts and instead provide International Paper’s account information, on the same terms as International Paper’s existing credit facilities, (ii) amend the financial covenant in the credit facility agreement to align with financial covenants given by International Paper in its existing credit facilities, (iii) amend certain events of default, and undertakings to align more closely with certain equivalent provisions included in the documentation relating to the existing financings of International Paper and to allow additional flexibility for potential reorganization of DS Smith’s subsidiaries, if required, now that DS Smith and its subsidiaries are part of the International Paper group. The credit facility agreement provides for interest rates at a fixed rate for each facility. At March 31, 2025, the Company had €200 million borrowings outstanding under the €200 million credit facility agreement. The Company’s credit facility agreement is not subject to any restrictive covenants other than that International Paper must comply with the same negative covenants as per its existing credit facilities. IP was in compliance with all its debt covenants at March 31, 2025, and was well below the thresholds stipulated under the covenants as defined in the credit facility agreement. Further the financial covenants do not restrict any borrowings under the credit facility agreement.

Current wording

In April 2025, the Company amended and restated its credit facility agreement to, among other things (i) replace its obligation to prepare audited and unaudited consolidated accounts and instead provide International Paper’s account information, on the same terms as International Paper’s existing credit facilities, (ii) amend the financial covenant in the credit facility agreement to align with financial covenants given by International Paper in its existing credit facilities, (iii) amend certain events of default, and undertakings to align more closely with certain equivalent provisions included in the documentation relating to the existing financings of International Paper and to allow additional flexibility for potential reorganization of DS Smith’s subsidiaries, if required, now that DS Smith and its subsidiaries are part of the International Paper group. The credit facility agreement provides for interest rates at a fixed rate for each facility. At June 30, 2025, the Company had €188 million (approximately $221 million) borrowings outstanding under the €200 million credit facility agreement. The Company’s credit facility agreement is not subject to any restrictive covenants other than that International Paper must comply with the same negative covenants as per its existing credit facilities. IP was in compliance with all its debt covenants at June 30, 2025, and was well below the thresholds stipulated under the covenants as defined in the credit facility agreement. Further the financial covenants do not restrict any borrowings under the credit facility agreement.

Previous wording

The Company also has a €60 million committed bank facility that matures in December 2026. In April 2025, the Company amended and restated its credit facility agreement to, among other things (i) replace its obligation to prepare audited and unaudited consolidated accounts and instead provide International Paper’s account information, on the same terms as International Paper’s existing credit facilities, (ii) amend the financial covenant in the credit facility agreement to align with financial covenants given by International Paper in its existing credit facilities, (iii) amend certain events of default, and undertakings to align more closely with certain equivalent provisions included in the documentation relating to the existing financings of International Paper and to allow additional flexibility for potential reorganization of DS Smith’s subsidiaries, if required, now that DS Smith and its subsidiaries are part of the International Paper group. The multi-currency credit facility allows for GBP, EUR and USD borrowings. At March 31, 2025, there were no borrowings outstanding under this agreement. The Company has a £50 million uncommitted bank facility. At March 31, 2025 the Company had $63 million borrowings outstanding under this agreement.

Current wording

The Company also has a €60 million committed bank facility that matures in December 2026. In April 2025, the Company amended and restated its credit facility agreement to, among other things (i) replace its obligation to prepare audited and unaudited consolidated accounts and instead provide International Paper’s account information, on the same terms as International Paper’s existing credit facilities, (ii) amend the financial covenant in the credit facility agreement to align with financial covenants given by International Paper in its existing credit facilities, (iii) amend certain events of default, and undertakings to align more closely with certain equivalent provisions included in the documentation relating to the existing financings of International Paper and to allow additional flexibility for potential reorganization of DS Smith’s subsidiaries, if required, now that DS Smith and its subsidiaries are part of the International Paper group. The multi-currency credit facility allows for GBP, EUR and USD borrowings. At June 30, 2025, there were no borrowings outstanding under this agreement. The Company has a £50 million uncommitted bank facility. At June 30, 2025 the Company had €55 million (approximately $65 million) borrowings outstanding under this agreement.

Previous wording

During the first three months of 2025, International Paper used 3.4 million shares of treasury stock for various incentive plans. International Paper also acquired 1.1 million shares of treasury stock, related to restricted stock tax withholdings during the first three months of 2024. Payments of restricted stock withholding taxes totaled $62 million during this period. Our current share repurchase program approved by our Board of Directors ("Board") on October 11, 2022, which does not have an expiration date, has approximately $2.96 billion aggregate amount of shares of common stock remaining authorized for purchase as of March 31, 2025. During the three months ended March 31, 2025, no shares of common stock were repurchased under our share repurchase program.

Current wording

During the first six months of 2025, International Paper used 3.5 million shares of treasury stock for various incentive plans. International Paper also acquired 1.1 million shares of treasury stock, related to restricted stock tax withholdings during the first six months of 2025. Payments of restricted stock withholding taxes totaled $63 million during this period. Our current share repurchase program approved by our Board of Directors ("Board") on October 11, 2022, does not have an expiration date and has approximately $2.96 billion aggregate amount of shares of common stock remaining authorized for purchase as of June 30, 2025. During the six months ended June 30, 2025, no shares of common stock were repurchased under our share repurchase program.

Previous wording

During the first three months of 2024, International Paper used approximately 1.9 million shares of treasury stock for various incentive plans. International Paper also acquired 0.6 million shares of treasury stock, related to restricted stock tax withholding during the first three months of 2024. Payments of restricted stock withholding taxes totaled $22 million. During the three months ended March 31, 2024, no shares of common stock were repurchased under our share repurchase program.

Current wording

During the first six months of 2024, International Paper used approximately 2.0 million shares of treasury stock for various incentive plans. International Paper also acquired 0.6 million shares of treasury stock, related to restricted stock tax withholding during the first three months of 2024. Payments of restricted stock withholding taxes totaled $22 million. During the six months ended June 30, 2024, no shares of common stock were repurchased under our share repurchase program.

Previous wording

Cash dividend payments related to common stock totaled $244 million and $161 million for the first three months of 2025 and 2024, respectively. Dividends were $0.4625 per share for the first three months of 2025 and 2024.

Current wording

Cash dividend payments related to common stock totaled $488 million and $321 million for the first six months of 2025 and 2024, respectively. Dividends were $0.9250 per share for the first six months of 2025 and 2024.

Previous wording

Our U.S. and U.K. pension plans are currently fully funded and we do not anticipate any required cash contributions for the next 12 months.

Current wording

Our U.S. and U.K. qualified pension plans are currently fully funded.

Previous wording

The Company has included in its Annual Report a discussion of these critical accounting policies, which are important to the portrayal of the Company’s financial condition and results of operations and may require management’s judgments. Except as described below, the Company has not made any changes in these critical accounting policies during the first three months of 2025.

Current wording

The Company has included in its Annual Report a discussion of these critical accounting policies, which are important to the portrayal of the Company’s financial condition and results of operations and may require management’s judgments. Except as described below, the Company has not made any changes in these critical accounting policies during the first six months of 2025.

Previous wording

The Company’s acquisitions of businesses are accounted for in accordance with ASC 805, "Business Combinations". We allocate the total purchase price of the assets acquired and liabilities assumed based on their estimated fair value as of the business combination date. In developing estimates of fair values for long-lived assets, including identifiable intangible assets, the Company utilizes a variety of inputs including forecasted cashflows, anticipated growth rates, discount rates, appraisals, market valuations, estimated replacement costs and depreciation, and obsolescence factors. Determining the fair value for specifically identified intangible assets such as customer lists and developed technology involves judgment. We may refine our estimates and make adjustments to the assets acquired and liabilities assumed over a measurement period, not to exceed one year. Upon the conclusion of the measurement period or the final determination of the values of assets acquired and liabilities assumed, whichever comes first, any subsequent adjustments are charged to the consolidated statements of earnings. Subsequent actual results of the underlying business activity supporting the goodwill and specifically identified intangible assets could change, requiring us to record impairment charges or adjust their economic lives in future periods.

Current wording

The Company’s acquisitions of businesses are accounted for in accordance with ASC 805, "Business Combinations." We allocate the total purchase price of the assets acquired and liabilities assumed based on their estimated fair value as of the business combination date. In developing estimates of fair values for long-lived assets, including identifiable intangible assets, the Company utilizes a variety of inputs including forecasted cashflows, anticipated growth rates, discount rates, appraisals, market valuations, estimated replacement costs and depreciation, and obsolescence factors. Determining the fair value for specifically identified intangible assets such as customer relationships and lists and tradenames, patents, trademarks and developed technology involves judgment. We may refine our estimates and make adjustments to the assets acquired and liabilities assumed over a measurement period, not to exceed one year. Upon the conclusion of the measurement period or the final determination of the values of assets acquired and liabilities assumed, whichever comes first, any subsequent adjustments are charged to the consolidated statements of earnings. Subsequent actual results of the underlying business activity supporting the goodwill and specifically identified intangible assets could change, requiring us to record impairment charges or adjust their economic lives in future periods.