INTERNATIONAL PAPER CO /NEW/

DESCRIPTION OF BUSINESS

International Paper Company (the "Company," "International Paper" or "IP", which may also be referred to as "we"

or "us") is a global leader in sustainable packaging solutions. We produce renewable fiber-based packaging

products with manufacturing operations in North America, Latin America, Europe and North Africa. We are a New

York corporation, incorporated in 1941 as the successor to the New York corporation of the same name organized in

1898. In recent years, the Company has undergone significant transformation designed to simplify our operations,

strengthen performance and position the business for long-term value creation.

STRATEGY

At International Paper, we follow the IP 80/20 performance system. The 80/20 approach is a disciplined, data-driven

operating model focused on simplification, segmentation, resourcing and growth. In recent years the Company has

taken actions to drive meaningful operational improvement and increase strategic flexibility across our global

portfolio, including:

We remain confident that the initiatives undertaken as part of our transformational journey will unlock substantial

value at IP and strengthen the Company for our employees, customers and shareholders.

2025 Highlights

•Financial: Net sales in 2025 totaled $23.63 billion and cash provided by operating activities totaled $1.7

billion.

•Strategic Acquisition: Completed the acquisition of DS Smith Ltd. (“DS Smith”), advanced regional

integration and implemented the 80/20 performance system within the new teams; enabled cross-business

sharing of best practices.

•Strategic Divestiture: Sold our Global Cellulose Fibers business for $1.5 billion to American Industrial

Partners (completed January 2026).

•Portfolio Rationalizations: Exited non-core businesses and markets, streamlined our footprint and

redeployed resources where needed.

•Organizational Improvements: Streamlined our organizational structure to eliminate redundancies created

by the acquisition, further decentralized our teams, outsourced some functional areas and better resourced

high value-creation areas.

•Shareholder Returns: Returned $977 million to shareholders in dividends.

•Packaging Focused Company: Took actions to position IP as a pure play company dedicated exclusively to

sustainable packaging.

2026 Focus

In 2026, we will continue to drive sustainable value creation and advance our company. Through the application of

our 80/20 performance system, we will execute our strategy with a sharp focus on achieving an advantaged cost

position, delivering superior customer experience and capturing a high relative supply position in the right

geographies, with the right customers and the right product offerings. A critical priority will be the execution of the

strategic separation to create two independent, publicly traded companies in North America and EMEA, which we

aim to complete near the end of 2026 or early 2027. In North America, the business will continue strengthening its

position in the region, focusing on customers and leading on innovation with an advantaged cost position. In EMEA,

we will prepare the business to stand alone as an independent, publicly traded entity following the separation with

the goal of becoming the leading provider of innovative, sustainable packaging solutions in EMEA.

From 2021 through 2025, International Paper’s capital expenditures totaled approximately$5.4 billion, excluding

mergers and acquisitions. These expenditures reflect our continuing efforts to use our capital strategically to

improve product quality and environmental performance, as well as lower costs, maintain reliability of operations

and deploy strategic capital for capacity expansion. Capital expenditures in 2025 were approximately$1.9 billion

and are expected to be approximately$2.0 billion to$2.1 billion in 2026. You can find more information about capital

expenditures in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Discussions of acquisitions can be found in Note 7 Acquisitions of Item 8. Financial Statements and Supplementary

Data.

You can find discussions of restructuring charges and other special items in Item 7. Management’s Discussion and

Analysis of Financial Condition and Results of Operations. For further discussion on our business strategies, see

CURRENT BUSINESS OVERVIEW

In the United States, as of the date of this filing, the Company operated 15 packaging mills,159 converting and

packaging plants and 15 recycling plants. Additionally, production facilities in Europe, North Africa and Latin America

included 14 containerboard mills,159 converting and packaging plants and 20 recycling plants. Substantially all our

businesses have experienced, and are likely to continue to experience, cycles relating to industry capacity and

general economic conditions.

VALUES

We are guided by our Company values:

•Safety – Above all else, we care about people. We look out for each other to ensure everyone is physically

and emotionally safe.

•Ethics – We act honestly and operate with integrity and respect. We promote a culture of transparency and

accountability.

•Excellence – We set high expectations and deliver outstanding results for each other, our customers and

our shareholders.

SEGMENTS

We operate under two divisions, which form the basis for the two segments we report, Packaging Solutions North

America and Packaging Solutions EMEA. A description of these business segments can be found in Item 7.

AVAILABLE INFORMATION

Throughout this Annual Report on Form 10-K, we “incorporate by reference” certain information in parts of other

documents filed with the U.S. Securities and Exchange Commission ("SEC"). The SEC permits us to disclose

important information by referring you to those documents. Our annual reports on Form 10-K, quarterly reports on

Form 10-Q, current reports on Form 8-K and proxy statements, along with all other reports and any amendments

thereto filed with or furnished to the SEC, are publicly available free of charge on the Investors section of our

website at www.internationalpaper.com as soon as reasonably practicable after we electronically file such material

with, or furnish it to, the SEC. We encourage you to refer to such information.

You can learn more about us by visiting our website at www.internationalpaper.com, which includes information

about the Company, our SEC filings, financial and other information for investors. Information on our website could

be deemed to be material information. We encourage investors, the media, and other interested parties to visit this

website regularly for updates. The information contained on or connected to our website is not incorporated by

reference into this Annual Report on Form 10-K and should not be considered part of this or any other report that we

file with or furnish to the SEC. Our internet address is included as an inactive textual reference only.