PACKAGING CORP OF AMERICA
For the period ended Jun 30, 2025. Filed Aug 7, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 7, 2025
PKG$249.70+0.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-08.
0000950170-25-066593
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-07.
0001193125-25-175122
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 104 previous paragraphs and 135 current paragraphs.
74 unchanged; 25 reworded; 30 added; 5 removed; 0 previous and 6 current paragraphs rearranged.
Tables are not compared: 7 previous and 10 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (30)
Current report
Packaging segment operating income was $624 million in the first six months of 2025, compared to $484 million in the same period in 2024. Packaging segment EBITDA excluding special items was $862 million in the first six months of 2025 compared to $726 million in the first six months of 2024.1 The increase in EBITDA excluding special items was due primarily to higher prices and mix, lower fiber costs, higher sales and production volumes, partially offset by higher operating and converting costs, higher maintenance outage expenses, higher fixed and other costs, and higher freight and logistics expense.
Current report
Paper segment operating income was $61 million in the first six months of 2025, compared to $56 million in the first six months of 2024. Paper segment EBITDA excluding special items was $71 million in the first six months of 2025 and 2024.1 The slight decrease in EBITDA excluding special items was due to lower sales and production volumes, higher operating costs, and higher maintenance outage expenses, partially offset by higher prices and mix, lower fixed and other costs, and lower freight and logistic expense.
Current report
On July 1, 2025, we announced our entry into a definitive agreement to purchase the containerboard business of Greif for $1.8 billion in cash. The transaction is expected to close by the end of the third quarter, subject to certain customary conditions, including regulatory approval. The Greif containerboard business includes two containerboard mills with approximately 800,000 tons of production capacity and eight sheet feeder and corrugated plants located across the United States. The operating results of the Greif Acquisition will be included in PCA’s results upon closing of the transaction. The acquisition is consistent with our historical growth strategy and will provide additional integration of containerboard we produce into our own corrugated products facilities.
Current report
In the Packaging segment, we expect higher corrugated shipments and containerboard production compared to the second quarter. Export containerboard sales will be lower due to the effects of the global trade environment. We will build some containerboard inventory ahead of our fourth quarter maintenance outage at the DeRidder mill. We expect prices and mix in the Packaging segment to be relatively flat with second quarter levels. We also expect flat pricing in the Paper segment and expect production and sales to increase in the third quarter with the International Falls mill outage completed in the second quarter and seasonal back-to-school orders. We have no scheduled maintenance outages during the third quarter and expect maintenance outage expense to be lower. Freight costs will be higher with the full effect of first and second quarter rail rate increases at our mills. Operating costs are expected to be near second quarter levels and fiber costs will be slightly lower. Considering these items, we expect third quarter earnings to be higher than second quarter earnings, excluding special items. Our third quarter outlook does not include any possible impact from the pending acquisition of the Greif containerboard business.
Current report
Net sales increased $96 million, or 4.6%, to $2,171 million during the three months ended June 30, 2025, compared to $2,075 million during the same period in 2024.
Current report
Gross profit increased $45 million during the three months ended June 30, 2025, compared to the same period in 2024. The increase was driven primarily by higher prices and mix in the Packaging segment, lower fiber costs, higher prices and mix in the Paper segment, partially offset by higher operating costs, higher maintenance outage expense, lower volumes in the Packaging and Paper segment, higher fixed and other expense, and higher freight expense. In the three months ended June 30, 2025, gross profit included $1 million of special items expense related to corrugated facility closure. In the three months ended June 30, 2024, gross profit included no special items.
Current report
Income from operations increased $58 million, or 20.9%, during the three months ended June 30, 2025, compared to the same period in 2024. The second quarter of 2025 included $23 million of special items income primarily related to gains on sales of corrugated products facilities, partially offset by corrugated products facility closure costs and costs related to the announced Greif, Inc. acquisition, compared to an insignificant amount of special items in the second quarter of 2024.
Current report
Packaging. Packaging segment operating income increased $66 million to $346 million, compared to $280 million during the three months ended June 30, 2024. The increase related primarily to higher containerboard and corrugated products prices and mix ($119 million), and lower fiber costs ($18 million), partially offset by higher operating and converting costs ($33 million), higher maintenance outage expenses ($25 million), lower sales and production volumes ($15 million), higher depreciation expense ($11 million), higher fixed and other expense ($8 million), and higher freight expenses ($3 million).The second quarter of 2025 included $25 million of special items income primarily related to gains on sales of corrugated products facilities, partially offset by corrugated products facility closure costs, compared to an insignificant amount of special items in the second quarter of 2024.
Current report
Paper. Paper segment operating income decreased $1 million to $26 million, compared to $27 million during the three months ended June 30, 2024. The decrease primarily related to higher operating costs ($4 million), lower volumes ($2 million), higher maintenance outage expenses ($1 million), partially offset by higher prices and mix ($4 million), lower freight expenses ($1 million), and lower fixed expense ($1 million). There were no significant special items in the second quarter of 2025 or 2024.
Current report
On July 4, 2025, the President signed into law H.R.1, the One Big Beautiful Bill Act (“OBBBA”). For additional information regarding the impact of the OBBBA, see Note 6, Income Taxes, of the Condensed Notes to Unaudited Quarterly Consolidated Financial Statements in “Part I, Item 1. Financial Statements” of this Form 10-Q.
Current report
Six Months Ended June 30, 2025, compared to Six Months Ended June 30, 2024
Current report
Net Sales
Current report
Net sales increased $257 million, or 6.4%, to $4,312 million during the six months ended June 30, 2025, compared to $4,055 million during the same period in 2024.
Current report
Packaging. Net sales increased $270 million, or 7.3%, to $3,976 million, compared to $3,707 million in the six months ended June 30, 2024, due to higher containerboard and corrugated products prices and mix ($202 million) and higher containerboard and corrugated products volume ($68 million). In the first six months of 2025, export and domestic containerboard outside shipments were flat compared to the first six months of 2024. Total corrugated products shipments were up 1.3% overall and up 2.1% per workday compared to the same period in 2024. In the first six months of 2025, our domestic containerboard prices were 7.1% higher, while export prices were 11.7% higher, than the same period in 2024.
Current report
Paper. Net sales during the six months ended June 30, 2025 decreased $14 million, or (4.4%), to $300 million, compared to $314 million in the six months ended June 30, 2024, due to lower volume ($20 million), partially offset by higher prices and mix ($6 million).
Current report
Gross Profit
Current report
Selling, General, and Administrative Expenses
Current report
Other Income (Expense), Net
Current report
Other income (expense), net, for the six months ended June 30, 2025 and 2024 are set forth below (dollars in millions):
Current report
Income from Operations
Current report
Non-Operating Pension Income, Interest Expense, and Income Taxes
Current report
Interest expense, net increased $6 million during the six months ended June 30, 2025, compared to the same period in 2024. The increase in interest expense, net was primarily due to higher interest expense in 2025 related to the Company’s November 2023 debt refinancing and lower interest income due to lower interest rates.
Current report
a net favorable change in accounts receivable due to a smaller increase in Packaging segment accounts receivable levels during the first six months of 2025 compared to the same period in 2024 primarily related to higher prices and sales volumes in 2024, partially offset by an increase in Paper segment accounts receivable levels during the first six months of 2025 compared to the same period in 2024 primarily related to an increase in days sales outstanding during 2025.
Current report
a net unfavorable change in inventories primarily related to an increase in Paper segment inventory balances during the first six months of 2025 compared to the same period in 2024 due to lower sales volumes in the first half of 2025, partially offset by a favorable change in Packaging segment inventory due to a smaller increase in inventory balances during the first half of 2025 compared to the same period in 2024.
Current report
(a)
Current report
For the three months and six months ended June 30, 2025, includes $1.6 million of charges related to the announced Greif, Inc. acquisition.
Current report
Amount may not foot due to rounding.
Current report
(e)
Current report
For the three months and six months ended June 30, 2025, includes charges related to the announced Greif, Inc. acquisition.
Removed paragraphs (5)
Previous report
In the Packaging segment, we expect domestic prices to improve with continued implementation of our price increases. We anticipate continued uncertainty relative to foreign and domestic tariff actions, which may affect demand and negatively impact volume and costs. Corrugated product shipments are expected to increase from first quarter levels, but operating costs will be negatively impacted due to lower containerboard production volume as we run our operations to match demand assumptions and achieve targeted inventory levels. We have also adjusted our planned maintenance outage schedule and moved an outage that was scheduled for later in the year into the second quarter, which will also increase our costs. In the Paper segment, we expect higher prices, although volume will be lower with the planned maintenance outage at our International Falls, MN mill. Rail contract rate increases at six of our mills during the first and second quarters will result in higher freight and logistics expenses, and depreciation expense is assumed to be higher as well. Considering these items, we expect second quarter earnings to be higher than first quarter earnings.
Previous report
Net sales increased $162 million, or 8.2%, to $2,141 million during the three months ended March 31, 2025, compared to $1,979 million during the same period in 2024.
Previous report
a net favorable change in income taxes resulting from a larger change in the difference between the year-end tax receivable amounts and first quarter-end tax payable amounts in 2025 compared to 2024.
Previous report
a net unfavorable change in accounts receivable mainly due to a decrease in Packaging accounts receivable levels during the first quarter of 2024;
Previous report
a net unfavorable change in inventories primarily due to a decrease in Packaging inventory balances for raw materials as well as a decrease in Paper inventory balances for finished goods during the first quarter of 2024; and
Reworded paragraphs (25)
Previous wording
First quarter net sales were $2.14 billion in 2025 and $1.98 billion in 2024. We reported $204 million of net income, or $2.26 per diluted share, during the first quarter of 2025, compared to $147 million, or $1.63 per diluted share, during the same period in 2024. Net income included $4 million of expense for special items in the first quarter of 2025, compared to $8 million of expense for special items in 2024 (discussed below). Excluding special items, net income was $208 million, or $2.31 per diluted share, during the first quarter of 2025, compared to $155 million, or $1.72 per diluted share, in the first quarter of 2024.1 The increase in net income was driven primarily by higher prices and mix and volume in the Packaging segment, higher prices and mix in the Paper segment, lower freight and logistics expenses, and lower scheduled outage costs. These items were partially offset by higher operating costs, lower volume in the Paper segment, higher depreciation and other expenses, higher tax rate, and higher interest expense. For additional detail on special items included in reported GAAP results and other non-GAAP measures, see “Item 2. Non-GAAP Financial Measures.”
Current wording
Second quarter net sales were $2.17 billion in 2025 and $2.08 billion in 2024. We reported $242 million of net income, or $2.67 per diluted share, during the second quarter of 2025, compared to $199 million, or $2.21 per diluted share, during the same period in 2024. Net income included $17 million of income for special items in the second quarter of 2025, compared to an insignificant amount of income for special items in 2024 (discussed below). Excluding special items, net income was $224 million, or $2.48 per diluted share, during the second quarter of 2025, compared to $199 million, or $2.20 per diluted share, in the second quarter of 2024.1 The increase in net income was driven primarily by higher prices and mix in the Packaging segment, lower fiber costs, higher prices and mix in the Paper segment, and a lower tax rate. These items were partially offset by higher operating costs, higher maintenance outage expense, lower production and export sales volume in the Packaging Segment, higher depreciation expense, higher fixed and other expense, lower volume in the Paper segment, higher freight expense, and higher interest expense. For additional detail on special items included in reported GAAP results and other non-GAAP measures, see “Item 2. Non-GAAP Financial Measures.”
Previous wording
Packaging segment operating income was $278 million in the first quarter of 2025, compared to $204 million in the first quarter of 2024. Packaging segment EBITDA excluding special items was $409 million in the first quarter of 2025 compared to $326 million in the first quarter of 2024.1 The increase was due to higher prices and mix and sales and production volumes, lower freight and logistics expense, and lower scheduled mill outage expenses, partially offset by higher operating and converting costs. Prices and mix moved higher, reflecting our price increases for containerboard and corrugated products announced to customers in 2024 and earlier in 2025. Solid demand drove a record 72.5 billion square feet of containerboard production, and corrugated plant shipments were up 2.5% compared to the first quarter of 2024. Demand slowed down during the latter part of the quarter, which we believe was due to cautious ordering patterns by customers in response to uncertain macroeconomic conditions.
Current wording
Packaging segment operating income was $346 million in the second quarter of 2025, compared to $280 million in the second quarter of 2024. Packaging segment EBITDA excluding special items was $453 million in the second quarter of 2025 compared to $400 million in the second quarter of 2024.1 The increase was due to higher prices and mix and lower fiber costs, partially offset by higher operating and converting costs, higher maintenance outage expense, lower production and export sales volumes, higher fixed and other expense, and higher freight and logistics expense. Prices and mix moved higher, reflecting our price increases for containerboard and corrugated products announced to customers in 2024 and earlier in 2025. Corrugated plant shipments were up 1.7% per day compared to the second quarter of 2024.
Previous wording
Paper segment operating income was $36 million in the first quarter of 2025, compared to $30 million in the first quarter of 2024. Paper segment EBITDA excluding special items was $40 million in the first quarter of 2025, compared to $41 million in the first quarter of 2024.1 The slight decrease in EBITDA excluding special items was due to lower sales and production volumes, partially offset by higher prices and mix.
Current wording
Paper segment operating income was $26 million in the second quarter of 2025, compared to $27 million in the second quarter of 2024. Paper segment EBITDA excluding special items was $30 million in the second quarter of 2025, compared to $31 million in the second quarter of 2024.1 The slight decrease in EBITDA excluding special items was due to higher operating costs and lower sales and production volumes and higher maintenance outage expense, partially offset by higher prices and mix and lower freight and fixed expenses.
Previous wording
Trade publications reported North American industry-wide corrugated products shipments were down (2.1%) in total and per workday during the first quarter of 2025 compared to the same quarter of 2024. Reported industry containerboard production decreased (0.4%) compared to the first quarter of 2024. Reported industry containerboard inventories at the end of the first quarter of 2025 were approximately 2.8 million tons, up 0.7% compared to the same period in 2024. Reported containerboard export shipments were down (7.7%) compared to the first quarter of 2024. In February 2025, reported index prices increased $40 per ton for linerboard and for corrugating medium.
Current wording
Trade publications reported North American industry-wide corrugated products shipments were down (2.6%) in total and (1.0%) per workday during the second quarter of 2025 compared to the same quarter of 2024. Reported industry containerboard production decreased (5.2%) compared to the second quarter of 2024. Reported industry containerboard inventories at the end of the second quarter of 2025 were approximately 2.6 million tons, down (2.1%) compared to the same period in 2024. Reported containerboard export shipments were down (16.2%) compared to the second quarter of 2024. In February 2025, reported index prices increased $40 per ton for linerboard and for corrugating medium.
Previous wording
The market for communication papers competes heavily with electronic data transmission and document storage alternatives. Increasing shifts to these alternatives have reduced usage of traditional print media and communication papers. Trade publications reported North American UFS paper shipments were down (8.3%) in the first quarter of 2025 compared to the same quarter of 2024. Average prices reported by a trade publication for cut size office papers were higher by $20 per ton, or 1.4% in the first quarter of 2025, compared to the fourth quarter of 2024, and higher by $60 per ton, or 4.3%, compared to the first quarter of 2024. In February 2025, reported index prices increased $30 per ton for cut size office papers and for offset printing papers.
Current wording
The market for communication papers competes heavily with electronic data transmission and document storage alternatives. Increasing shifts to these alternatives have reduced usage of traditional print media and communication papers. Trade publications reported North American UFS paper shipments were down (8.5%) in the first six months of 2025, compared to the same period of 2024. Average prices reported by a trade publication for cut size office papers were higher by $20 per ton, or 1.4% in the second quarter of 2025, compared to the first quarter of 2025, and higher by $47 per ton, or 3.2%, compared to the second quarter of 2024. Reported index prices increased $30 per ton for cut size office papers and for offset printing papers in February 2025 and $10 per ton in April 2025.
Previous wording
Packaging. Net sales increased $172 million, or 9.6%, to $1,970 million, compared to $1,798 million in the first quarter of 2024 due to higher containerboard and corrugated products prices and mix ($95 million) and higher volume ($77 million). In the first quarter of 2025, export and domestic containerboard outside shipments increased 13.4% compared to the first quarter of 2024. Our total corrugated products shipments were up 2.5% in total and per workday, compared to the same period in 2024. In the first quarter of 2025, our domestic containerboard prices were 3.5% higher, while export prices were 13.7% higher, than the same period in 2024.
Current wording
Packaging. Net sales increased $98 million, or 5.1%, to $2,006 million, compared to $1,908 million in the second quarter of 2024 due to higher containerboard and corrugated products prices and mix ($107 million), partially offset by lower volume ($9 million). In the second quarter of 2025, export and domestic containerboard outside shipments decreased (11.4%) compared to the second quarter of 2024. Our total corrugated products shipments were flat in total and up 1.7% per workday, with one less workday, compared to the same period in 2024. In the second quarter of 2025, our domestic containerboard prices were 10.8% higher, while export prices were 10.4% higher than the same period in 2024.
Previous wording
Paper. Net sales decreased $10 million, or (5.9%), to $154 million, compared to $164 million in the first quarter of 2024, due to lower volume ($12 million), partially offset by higher prices and mix ($2 million).
Current wording
Paper. Net sales decreased $4 million, or (2.9%), to $146 million, compared to $150 million in the second quarter of 2024, due to lower volume ($8 million), partially offset by higher prices and mix ($4 million).
Previous wording
Interest expense, net for the three months ended March 31, 2025 increased $3 million when compared to the same period in 2024. The increase in interest expense, net was primarily due to lower interest income on invested cash balances in 2025 due to lower interest rates and lower invested balances.
Current wording
Interest expense, net for the three months ended June 30, 2025 increased $3 million when compared to the same period in 2024. The increase in interest expense, net was primarily due to higher interest expense in 2025 related to the Company’s November 2023 debt refinancing.
Previous wording
During the three months ended March 31, 2025, we recorded $64 million of income tax expense, compared to $41 million of expense during the three months ended March 31, 2024. The effective tax rate for the three months ended March 31, 2025 and 2024 was 23.8% and 21.6%, respectively. The increase in our effective tax rate for the three months ended March 31, 2025 compared to the same period in 2024 was primarily due to lower excess tax benefits associated with employee restricted stock and performance unit vests.
Current wording
During the three months ended June 30, 2025, we recorded $79 million of income tax expense, compared to $68 million of expense during the three months ended June 30, 2024. The effective tax rate for the three months ended June 30, 2025 and 2024 was 24.7% and 25.4%, respectively. The decrease in our effective tax rate for the three months ended June 30, 2025 compared to the same period in 2024 was primarily due to higher excess tax benefits associated with employee restricted stock and performance unit vests.
Previous wording
Gross profit increased $84 million during the three months ended March 31, 2025, compared to the same period in 2024. The increase was driven primarily by higher prices and mix and volume in the Packaging segment, higher prices and mix in the Paper segment, lower freight and logistics expenses, and lower scheduled outage costs, partially offset by higher operating costs, and lower volume in the Paper segment. In the three months ended March 31, 2025, gross profit included $4 million of special items expense related to corrugated facility closure and other costs. In the three months ended March 31, 2024, gross profit included $2 million of special items expense related to Jackson mill conversion-related activities.
Current wording
Gross profit increased $130 million during the six months ended June 30, 2025, compared to the same period in 2024. The increase was driven primarily by higher prices and mix and sales volumes in the Packaging segment, lower fiber costs, and higher prices and mix in the Paper segment, partially offset by higher operating costs, higher maintenance outage expense, lower volume in the Paper Segment, and higher fixed and other expense. In the six months ended June 30, 2025, gross profit included $4 million of special items expense related to corrugated facility closure. In the six months ended June 30, 2024, gross profit included $2 million of special items expense related to Jackson mill conversion-related activities.
Previous wording
Selling, general, and administrative expenses (“SG&A”) increased $10 million during the three months ended March 31, 2025, compared to the same period in 2024. The increase was primarily due to higher employee-related expenses and bad debt expense.
Current wording
Selling, general, and administrative expenses (“SG&A”) increased $13 million during the six months ended June 30, 2025, compared to the same period in 2024. The increase was primarily due to higher employee-related expenses, insurance, and bad debt expense.
Previous wording
Income from operations increased $84 million, or 43.0%, during the three months ended March 31, 2025, compared to the same period in 2024. The first quarter of 2025 included $6 million of special items related to corrugated products facility closure costs, compared to $10 million of special items expense primarily related to Jackson mill conversion-related activities in the first quarter of 2024.
Current wording
Income from operations increased $142 million, or 30.1%, during the six months ended June 30, 2025, compared to the same period in 2024. The first six months of 2025 included $17 million of special items income primarily related to gains on sales of corrugated products facilities, partially offset by corrugated products facility closure costs and costs related to the announced Greif, Inc. acquisition, compared to $10 million in the same period in 2024 related to Jackson mill conversion-related costs.
Previous wording
Packaging. Packaging segment operating income increased $74 million to $278 million, compared to $204 million during the three months ended March 31, 2024. The increase related primarily to higher containerboard and corrugated products prices and mix ($91 million), higher sales and production volumes ($31 million), lower freight expenses ($2 million), and lower annual outage expenses ($1 million), partially offset by higher operating and converting costs ($42 million), and higher depreciation expense ($7 million). The first quarter of 2025 included $6 million of special items related to corrugated products facility closure costs, compared to $4 million of special items expense primarily related to Jackson mill conversion-related activities in the first quarter of 2024.
Current wording
Packaging. Packaging segment operating income increased $141 million to $624 million during the first six months of 2025, compared to the same period last year. The increase related primarily to higher containerboard and corrugated products prices and mix ($210 million), lower fiber costs ($27 million), and higher sales and production volumes ($16 million), partially offset by higher operating and converting costs ($71 million), higher maintenance outage expenses ($24 million), higher fixed and other costs ($21 million), and higher depreciation expense ($18 million). Special items during the first six months of 2025 included $19 million of income primarily related to gains on sales of corrugated products facilities, partially offset by corrugated products facility closure costs, compared to $4 million of expense related to Jackson mill conversion-related activities in the same period in 2024.
Previous wording
Paper. Paper segment operating income increased $6 million to $36 million, compared to $30 million during the three months ended March 31, 2024. The increase primarily related to no special items in the Paper segment during the first quarter of 2025, compared to $6 million of expense for Jackson mill conversion-related activities in the first quarter of 2024, along with higher prices and mix ($2 million) and lower other costs ($1 million), partially offset by lower sales and production volumes ($3 million).
Current wording
Paper. Paper segment operating income increased $5 million to $61 million, compared to the six months ended June 30, 2024. The increase primarily related to no special items in the Paper segment during the first six months of 2025, compared to $6 million of expense for Jackson mill conversion-related activities in the first six months of 2024, along with higher prices and mix ($6 million), lower fixed and other expenses ($2 million), and lower freight expense ($1 million), partially offset by lower sales and production volumes ($5 million), higher operating costs ($5 million), and higher maintenance outage expenses ($1 million).
Previous wording
Our primary sources of liquidity are net cash provided by operating activities and available borrowing capacity under our revolving credit facility. At March 31, 2025, we had $752 million of cash and cash equivalents, $162 million of marketable debt securities, and $323 million of unused borrowing capacity under the revolving credit facility, net of letters of credit. Currently, our primary uses of cash are for operations, capital expenditures, acquisitions, debt service, common stock dividends, and repurchases of common stock. We believe that net cash generated from operating activities, cash on hand, available borrowings under our revolving credit facility, and available capital through access to capital markets will be adequate to meet our liquidity and capital requirements, including payments of any declared common stock dividends, for the foreseeable future. As our debt or credit facilities become due, we will need to repay, extend, or replace such facilities. Our ability to do so will be subject to future economic conditions and financial, business, and other factors, many of which are beyond our control.
Current wording
Our primary sources of liquidity are net cash provided by operating activities and available borrowing capacity under our revolving credit facility. At June 30, 2025, we had $788 million of cash and cash equivalents, $168 million of marketable debt securities, and $323 million of unused borrowing capacity under the revolving credit facility, net of letters of credit. Currently, our primary uses of cash are for operations, capital expenditures, acquisitions, debt service, common stock dividends, and repurchases of common stock. We believe that net cash generated from operating activities, cash on hand, available borrowings under our revolving credit facility, and available capital through access to capital markets will be adequate to meet our liquidity and capital requirements, including payments of any declared common stock dividends, for the foreseeable future. As our debt or credit facilities become due, we will need to repay, extend, or replace such facilities. Our ability to do so will be subject to future economic conditions and financial, business, and other factors, many of which are beyond our control.
Previous wording
During the three months ended March 31, 2025, net cash provided by operating activities was $339 million, compared to $260 million in the same period in 2024, an increase of $79 million. Cash from operations excluding changes in cash used for operating assets and liabilities increased $55 million primarily due to higher income from operations in 2025 as discussed above. Cash from operations increased by $24 million when comparing the first three months of 2025 to the same period in 2024 due to changes in operating assets and liabilities primarily due to the following:
Current wording
During the six months ended June 30, 2025, net cash provided by operating activities was $639 million, compared to $539 million in the same period in 2024, an increase of $100 million. Cash from operations excluding changes in cash used for operating assets and liabilities increased $84 million primarily due to higher income from operations in 2025 as discussed above. Cash from operations increased by $16 million when comparing the first six months of 2025 to the same period in 2024 due to changes in operating assets and liabilities primarily due to the following:
Previous wording
a net favorable change in prepaid expenses and other current assets primarily related to the establishment of a receivable for the DeRidder trial and related insurance recoveries in the first quarter of 2024 and reduction of receivables against insurance carriers in the first quarter of 2025 related to the settlement of other litigation;
Current wording
a net favorable change in prepaid expenses and other current assets primarily related to the establishment of a receivable for the DeRidder trial and related insurance recoveries during the first six months of 2024 and reduction of receivables against insurance carriers in the first six months of 2025 related to the DeRidder settlement and settlement of other litigation; and
Previous wording
a net unfavorable change in accrued liabilities predominantly related to the establishment of an accrued liability for the DeRidder trial in the first quarter of 2024 and reduction of accrued liabilities in the first quarter of 2025 related to the settlement of other litigation.
Current wording
a net unfavorable change in accrued liabilities predominantly related to the establishment of an accrued liability for the DeRidder trial in the first half of 2024 and reduction of accrued liabilities in the first half of 2025 related to the DeRidder settlement and settlement of other litigation;
Previous wording
a net favorable change in accounts payable primarily related to timing of payments, partially offset by an unfavorable change in accounts payable during 2025 due to a smaller increase in accounts payable levels during the first quarter of 2025 compared to the first quarter of 2024; and
Current wording
a net unfavorable change in accounts payable primarily related to a smaller increase in accounts payable levels during the first six months of 2025 compared to the same period in 2024 due to a larger increase in cost of sales and days payables outstanding during 2024 compared to 2025; and
Previous wording
We used $144 million for investing activities during the three months ended March 31, 2025 compared to $81 million during the same period in 2024. We spent $148 million for internal capital investments during the three months ended March 31, 2025, compared to $77 million during the same period in 2024.
Current wording
We used $287 million for investing activities during the six months ended June 30, 2025 compared to $324 million during the same period in 2024. We spent $318 million for internal capital investments during the six months ended June 30, 2025, compared to $322 million during the same period in 2024.
Previous wording
During the three months ended March 31, 2025, net cash used for financing activities was $128 million, compared to $135 million of net cash used for financing activities during the same period in 2024. We paid $112 million of dividends during the first three months of both 2025 and 2024. In addition, we withheld shares to cover $15 million of employee restricted stock taxes during the first three months of 2025 compared to $23 million of employee restricted stock taxes withheld during the same period in 2024. We did not have any repurchases and retirements of the Company’s common stock during both the three months ended March 31, 2025 and 2024.
Current wording
During both of the six month periods ended June 30, 2025 and 2024, net cash used for financing activities was $249 million. We paid $225 million of dividends during the first six months of 2025, compared to $224 million of dividends paid during the comparable period in 2024. In addition, we withheld shares to cover $23 million of employee restricted stock taxes during the first six months of 2025 compared to $24 million of employee restricted stock taxes withheld during the same period in 2024. We did not have any repurchases and retirements of the Company’s common stock during both the six months ended June 30, 2025 and 2024.
Previous wording
For 2025, includes charges consisting of closure costs related to corrugated products facilities. For 2024, includes income primarily related to a favorable lease buyout for a closed corrugated products facility, partially offset by closure costs related to corrugated products facilities and design centers.
Current wording
For the three and six months ended June 30, 2025, includes $24.6 million and $18.8 million, respectively, of income related to gains on sales of corrugated products facilities, partially offset by closure costs related to corrugated products facilities. For the three months ended June 30, 2024, includes $0.1 million of charges consisting of closure costs related to corrugated products facilities. For the six months ended June 30, 2024, these charges were completely offset by $0.1 million of income primarily related to a favorable lease buyout for a closed corrugated products facility during the first quarter of 2024.
Previous wording
For the three months ended March 31, 2024, includes $10.4 million of charges related to the announced discontinuation of production of UFS paper grades on the No. 3 machine at the Jackson, Alabama mill associated with the permanent conversion of the machine to produce linerboard and other paper-to-containerboard conversion related activities.
Current wording
For the three and six months ended June 30, 2024, includes $0.6 million of income and $9.7 million of charges, respectively, related to the announced discontinuation of production of UFS paper grades on the No. 3 machine at the Jackson, Alabama mill associated with the permanent conversion of the machine to produce linerboard and other paper-to-containerboard conversion related activities.
Previous wording
For the three months ended March 31, 2025, includes $5.9 million of charges consisting of closure costs related to corrugated products facilities. For the three months ended March 31, 2024, includes $0.1 million of income primarily related to a favorable lease buyout for a closed corrugated products facility, partially offset by closure costs related to corrugated products facilities and design centers.
Current wording
For the three and six months ended June 30, 2025, includes income related to gains on sales of corrugated products facilities, partially offset by closure costs related to corrugated products facilities. For the three months ended June 30, 2024, includes charges consisting of closure costs related to corrugated products facilities. For the six months ended June 30, 2024, these charges were completely offset by income primarily related to a favorable lease buyout for a closed corrugated products facility during the first quarter of 2024.
Previous wording
PCA has included in its 2024 Annual Report on Form 10-K a discussion of its critical accounting policies and estimates which require management’s most difficult, subjective, or complex judgments used in the preparation of its consolidated financial statements. PCA has not had any changes to these critical accounting estimates during the first three months of 2025.
Current wording
PCA has included in its 2024 Annual Report on Form 10-K a discussion of its critical accounting policies and estimates which require management’s most difficult, subjective, or complex judgments used in the preparation of its consolidated financial statements. PCA has not had any changes to these critical accounting estimates during the first six months of 2025.
Rearranged current paragraphs (6)
Current report — wording carried from elsewhere
Selling, general, and administrative expenses (“SG&A”) increased $4 million during the three months ended June 30, 2025, compared to the same period in 2024. The increase was primarily due to higher employee-related expenses and insurance.
Current report — wording carried from elsewhere
The historical results of operations of PCA for the six months ended June 30, 2025 and 2024 are set forth below (dollars in millions):
Current report — wording carried from elsewhere
See “Non-GAAP Financial Measures” included in this Item 2 for a reconciliation of non-GAAP measures to the most comparable GAAP measure.
Current report — wording carried from elsewhere
We discuss these items in more detail in Note 5, Other Income (Expense), Net, of the Condensed Notes to Unaudited Quarterly Consolidated Financial Statements in “Part I, Item 1. Financial Statements” of this Form 10-Q.
Current report — wording carried from elsewhere
Non-operating pension income decreased $2 million during the six months ended June 30, 2025, compared to the same period in 2024. The decrease in non-operating pension income was related to unfavorable 2024 asset performance partially offset by favorable assumption changes.
Current report — wording carried from elsewhere
During the six months ended June 30, 2025, we recorded $143 million of income tax expense, compared to $108 million of expense during the six months ended June 30, 2024. The effective tax rate for the six months ended June 30, 2025 and 2024 was 24.3% and 23.9%, respectively. The increase in our effective tax rate for the six months ended June 30, 2025 compared to the same period in 2024 was primarily due to lower excess tax benefits associated with employee restricted stock and performance unit vests.