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Reynolds Consumer Products Inc. (REYN)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 total net revenues were $931M, up 2% year-over-year; Adjusted EPS was $0.42 (vs $0.41 YoY), and Adjusted EBITDA was $168M (vs $171M YoY). Retail net revenues were $864M (+1% YoY), while non‑retail revenues rose to $67M .
  • Results beat Wall Street consensus: revenue $931M vs $900.8M*, EPS $0.42 vs $0.3931*, and Adjusted EBITDA $168M vs $165.0M*; all were modest beats, helped by pricing actions offsetting commodity/tariff headwinds and category share gains .
  • Full-year guidance lifted: 2025 net revenues now “flat to down 1%,” Adjusted EPS to $1.60–$1.64, and Adjusted EBITDA to $655–$665M; Q4 Adjusted EPS guided to $0.56–$0.60 .
  • Board declared a $0.23 dividend payable Nov 28 and the company made a voluntary $50M principal payment post‑quarter; index inclusion in the S&P SmallCap 600 (effective Sept 24) is a potential flow catalyst .

Note: Estimates marked * are from S&P Global.

What Went Well and What Went Wrong

What Went Well

  • Broad-based share gains across categories (Hefty Waste Bags, Hefty Party Cups, Reynolds Wrap foil, Reynolds Kitchens parchment, store-brand food bags) drove improved results in all four business units; management: “Our people, brands and products are winning” .
  • Pricing actions implemented “as planned” in aluminum foil; Reynolds Wrap retail sales up ~7% with narrowed price gaps to store brands, supporting volumes above category declines .
  • Continued cost discipline: SG&A down $29M YTD; all segments grew EBITDA in Q3; CFO raised full-year revenue and Adjusted EPS guidance as programs begin to flow through .

What Went Wrong

  • Gross profit declined $6M YoY and Adjusted EBITDA dipped slightly YoY (to $168M from $171M), reflecting lower volumes and commodity/tariff cost impacts despite pricing alignment .
  • Hefty Tableware volumes fell 13% on continued foam declines; while EBITDA rose on pricing/input cost alignment and promo discipline, volume pressure remains a headwind .
  • Consumer still under pressure (sentiment down YoY, inflation above target), and promotional intensity elevated in waste and food bags categories; management flagged risk that private-label bids could increase in a tariff‑impacted retail environment .

Financial Results

Consolidated Results vs Prior Periods

MetricQ3 2024Q1 2025Q2 2025Q3 2025
Total Net Revenues ($USD Millions)$910 $818 $938 $931
GAAP EPS ($USD)$0.41 $0.15 $0.35 $0.38
Adjusted EPS ($USD)$0.41 $0.23 $0.39 $0.42
Adjusted EBITDA ($USD Millions)$171 $117 $163 $168
Gross Profit ($USD Millions)$239 $189 $226 $233

Margins (computed from reported figures)

MetricQ3 2024Q1 2025Q2 2025Q3 2025
Gross Profit Margin %26.3% 23.1% 24.1% 25.0%
Adjusted EBITDA Margin %18.8% 14.3% 17.4% 18.0%
Net Income Margin %9.5% 3.8% 7.8% 8.5%

Note: Margins are calculated using reported Net Revenues, Gross Profit, Adjusted EBITDA, and Net Income.

Segment Breakdown (Q3 YoY)

Segment MetricQ3 2024Q3 2025
Reynolds Cooking & Baking – Revenues ($MM)$294 $308
Reynolds Cooking & Baking – Adjusted EBITDA ($MM)$50 $53
Hefty Waste & Storage – Revenues ($MM)$253 $266
Hefty Waste & Storage – Adjusted EBITDA ($MM)$72 $74
Hefty Tableware – Revenues ($MM)$222 $200
Hefty Tableware – Adjusted EBITDA ($MM)$26 $29
Presto Products – Revenues ($MM)$150 $163
Presto Products – Adjusted EBITDA ($MM)$33 $35

KPIs

KPIQ1 2025Q2 2025Q3 2025
Retail Net Revenues ($MM)$767 $887 $864
Non‑Retail Revenues ($MM)$51 $51 $67
Retail Volume YoY (%)-4% -1% -2%

Note: Q3 retail volume excluding foam increased 1% (3‑point foam headwind) .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Revenues (YoY)FY 2025Down low single digits Flat to down 1% vs $3,695M in 2024 Raised (less negative)
Adjusted EBITDA ($MM)FY 2025$650–$670 $655–$665 Raised (midpoint +$5M)
Adjusted EPS ($)FY 2025$1.54–$1.61 $1.60–$1.64 Raised
Net Income ($MM, GAAP)FY 2025N/A$294–$302 New
EPS (GAAP) ($)FY 2025N/A$1.40–$1.44 New
Net Revenues (YoY)Q4 2025N/ADown 1% to 5% vs $1,021M in Q4 2024 New
Adjusted EBITDA ($MM)Q4 2025N/A$208–$218 New
Adjusted EPS ($)Q4 2025N/A$0.56–$0.60 New
Dividend ($/share)Q4 2025$0.23 (recurring) $0.23 payable Nov 28, 2025 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2025)Previous Mentions (Q1 2025)Current Period (Q3 2025)Trend
Pricing vs commodity/tariff costsImplemented pricing offsetting cost inflation; reiterating FY guide Expect +2–4 pts positive pricing to offset tariff‑related costs ~4 pts pricing in Q3; 2–4 pts cost headwind expected for year Improving alignment
Consumer/macroChallenging environment; disciplined SG&A; investment in growth Retailer destocking; consumer under pressure Barbell strategy (brands vs value); sentiment down; inflation ~3% Cautious
Promotional intensityNot emphasizedPromo spend flat YoY in Hefty W&S Higher promo intensity in waste/food bags; company in line with pre‑pandemic levels Elevated but managed
Manufacturing/supply chain initiatives (technology/automation)On track; expect benefits late year Refinanced term loan; operations resilience New COO hired; lean/automation to drive productivity Building execution
Product performance/innovationHefty Fabuloso, new launches; category leadership Hefty Fabuloso; Reynolds Wrap share gains Reynolds Wrap Fun Foil expansion; Air Fryer innovations; scented waste bags momentum Strong pipeline
Category/segment dynamics (foam/tableware)Foam declines impacting Tableware Foam + destocking pressured Tableware Tableware vol -13% (80% from foam); EBITDA up; expect foam headwind to lessen in 2026 Headwind moderating
Capital allocation/leverageDividend, inside 2–2.5x leverage Refinancing to extend maturities; dividend $50M voluntary debt paydown; leverage 2.4x TTM Adjusted EBITDA Positive de‑leveraging

Management Commentary

  • CEO: “Our people, brands and products are winning in a challenging environment, with all four business units delivering improved results driven by share gains…” .
  • CEO on category/pricing: “Reynolds Wrap aluminum foil volume outperformed the category… price gaps to store brands narrowed… offering consumers a compelling value proposition” .
  • CFO: “We delivered another quarter of results above our previously communicated expectations… pleased to increase our revenue and adjusted EPS guides for the year” .
  • CEO on operations: “We are… leaning more heavily on technology, the expansion of lean principles, and additional automation throughout our operations” .

Q&A Highlights

  • Promotional intensity: Waste and food bags seeing elevated promos; REYN’s promo levels remain aligned with pre‑pandemic norms, with execution and innovation driving outcomes .
  • Consumer health: Inflation ~3% (above target), cooling labor market, and lower consumer sentiment; REYN serving both brand‑loyal and value‑oriented consumers (barbell strategy) .
  • Private-label dynamics: Expect stepped-up bid activity amid tariff uncertainty; US‑centric manufacturing footprint positions REYN to “win more than we lose” .
  • Cost/pricing alignment: 2–4 pts cost headwinds from commodities/tariffs; ~4 pts pricing in Q3 intended to fully offset; sequential gross profit improvement .
  • Tableware foam: Volume down, but EBITDA up ~10% despite declines; foam headwind expected to be less in 2026 (California impact annualizing) .

Estimates Context

MetricQ3 2025 Consensus*Q3 2025 Actual
Revenue ($USD Millions)$900.8*$931
Primary EPS ($USD)$0.3931*$0.42
Adjusted EBITDA ($USD Millions)$165.0*$168
# EPS Estimates8*—
# Revenue Estimates5*—
Target Price Consensus Mean ($)$27.75*$27.75*
  • Outcome: Revenue, EPS, and Adjusted EBITDA were modest beats versus consensus; guidance raised should support upward estimate revisions, particularly for FY Adjusted EPS (new $1.60–$1.64 vs FY EPS consensus $1.6307*) and Adjusted EBITDA ($655–$665M vs $662.8M* midpoint) .

Note: Values marked * retrieved from S&P Global.

Key Takeaways for Investors

  • Broad category share gains and effective pricing offset commodity/tariff headwinds, yielding beats on revenue, EPS, and Adjusted EBITDA; momentum into Q4 with Adjusted EPS guided to $0.56–$0.60 .
  • Guidance raised for FY 2025 (revenues, Adjusted EPS, Adjusted EBITDA), signaling confidence in retail trends, cost discipline, and early benefits from manufacturing initiatives; expect incremental estimate upgrades .
  • Segment mix improving: Hefty Waste & Storage and Presto delivered revenue/EBITDA growth; Tableware profitability improved despite foam volume declines—foam headwind should lessen next year .
  • Cost actions and capital allocation de‑risk the model: SG&A down $29M YTD; $50M voluntary debt paydown post‑quarter; leverage at 2.4x TTM Adjusted EBITDA .
  • Near-term trading: Positive setup on beats/raised guide and holiday season product activation; S&P SmallCap 600 inclusion could provide passive flows support .
  • Medium-term thesis: Margin expansion through automation/lean, US‑centric supply chain advantage amid tariffs, and innovation (scented waste, parchment, Fun Foil) underpin durable earnings growth .
  • Watch items: Sustained consumer pressure and promo intensity; monitor aluminum costs and tariff developments; private-label bid activity as retailers seek value .