Reynolds Consumer Products (REYN)·Q4 2025 Earnings Summary

Reynolds Consumer Products Q4 2025: Revenue Beats, Stock Falls 6% on Tepid Guidance

February 4, 2026 · by Fintool AI Agent

Reynolds Consumer Products (REYN) delivered a Q4 2025 revenue beat of 2.7% and matched adjusted EPS expectations, but shares tumbled approximately 6% as investors digested soft 2026 guidance and ongoing headwinds in the foam tableware category. The company reported net revenues of $1.034 billion versus the $1.007 billion consensus, with adjusted EPS of $0.59 matching estimates.

New CEO Scott Huckins, who took the helm on January 1, 2025, emphasized the company's resilience: "I'm proud of the results our team delivered in a challenging macro environment. We gained share, delivered excellent service levels, and reinforced the fundamentals of our U.S.-centric business."

Did Reynolds Beat Earnings?

Reynolds delivered mixed results that leaned positive on the top line but met expectations on the bottom line:

The revenue beat was driven by pricing actions to recover higher input costs and strength in non-retail revenues (up 52% YoY to $70M), partially offset by a 2% decline in retail volumes. The GAAP EPS miss reflects $7 million of after-tax CEO transition costs and strategic investments in cost savings and revenue growth initiatives.

Looking at the full fiscal year 2025, the results showed similar dynamics:

What Changed This Quarter?

The Good:

• Presto Products hit record highs — Revenue reached a record $168M (+9% YoY) with volume up 10%, driven by strong share gains in store brand food bags. Adjusted EBITDA also hit a record $36M (+16% YoY).
• Hefty Waste & Storage showed strength — Hefty waste bags outperformed the category by 7 points for the full year and 3 points in Q4. Retail volume increased 3% with share gains in both Hefty waste bags and Hefty Press to Close food bags. Adjusted EBITDA jumped to $76M (+10% YoY).
• Branded share gains continued — Reynolds Wrap, bakeware, and parchment drove share gains in the Cooking & Baking segment. Outperformed categories by 1 point for full year 2025 and 2 points in Q4.
• Distribution gains — Picked up approximately 5 points of distribution in Q4, positioning well for spring shelf resets.
• Net debt leverage improved — Reduced from 2.3x to 2.1x, at the low end of the 2.0-2.5x target range.

The Challenging:

• Hefty Tableware struggled — Revenue declined 10% to $229M with retail volume down 12%, driven primarily by double-digit declines in the foam category.
• Overall retail volumes declined — Total retail volumes fell 2%, though this exceeded category performance by 2 points and was flat excluding foam.
• Capex increased significantly — Capital expenditures rose to $161M from $120M in 2024, reflecting increased investments in automation and productivity.

What Did Management Guide?

The 2026 outlook is what spooked investors. Management guided for essentially flat revenue and earnings growth, falling short of street expectations:

For Q1 2026 specifically:

• Net Revenues: -3% to +1% vs Q1 2025's $818M
• EPS / Adjusted EPS: $0.23 - $0.25
• Adjusted EBITDA: $120M - $125M

The company also announced a segment reorganization beginning in Q1 2026, consolidating waste bags in one business unit and food bags/storage in another. CFO Lowe clarified this is "not a cost-driven motive" but rather an "execution-driven motive" aimed at providing end-to-end management and "clarity for growth."

How Did the Stock React?

Reynolds shares fell sharply on the earnings release, closing down approximately 5.6% to $21.81 from the prior day's close of $23.11. In aftermarket trading, shares slipped further to $21.43.

The negative reaction likely reflects:

1. Guidance disappointment — FY 2026 EPS guidance of $1.57-$1.63 significantly trails the ~$2.00 consensus
2. Foam category headwinds — Continued weakness in Hefty Tableware with no clear turnaround timeline
3. Elevated capex — $161M in FY25 capex (up from $120M) with more investment planned, pressuring free cash flow

For context, Reynolds stock has declined approximately 22% from its 52-week high of $27.98, and the stock now trades at approximately 13.3x forward P/E based on the midpoint of 2026 guidance.

Key Management Quotes

CEO Scott Huckins on 2025 execution:

"We gained share, delivered excellent service levels, and reinforced the fundamentals of our U.S.-centric business by executing with discipline, innovating to meet evolving consumer needs, and investing in growth and productivity."

On the 2026 outlook:

"We enter 2026 well-positioned, with the team, resources, operating agility, innovation pipeline, and category leadership to navigate dynamic operating conditions."

CFO Nathan Lowe on capital allocation:

"As we look ahead, our priority is to further realize the benefits of the numerous initiatives we launched in 2025 and continue to invest in the business to deliver sustainable earnings growth that drives long-term shareholder value."

Q&A Highlights

The Q&A session revealed several important dynamics that shaped investor sentiment:

Competitive Dynamics in Waste Bags: Management acknowledged intensifying promotional activity from competitors in the waste bag category as Q4 ended. CFO Nathan Lowe noted Hefty waste bags outperformed the category by 7 points in 2025 (on a category up ~1%), but cautioned they "wouldn't expect that level of success" to continue in 2026. Despite competitive pressure, CEO Scott Huckins emphasized staying the course:

"The comments about staying the course are really a fundamental and long-term view of maintaining the brand equity in the Hefty brand... Our view is the right long-term strategy for the business is to stay the course."

Foam Category Outlook: Foam volumes declined approximately 14% in 2025, but management expects roughly half that rate of decline in 2026. CFO Lowe attributed this to consumer-driven shifts rather than further regulatory changes:

"The bigger shock to the system would have been 2025 versus 2026. What's happening is more consumer driven, including things like the considerations of the cost of alternatives."

Foil Pricing Power: When asked about the $5 price point threshold for foil (which caused share losses in 2022), CEO Huckins highlighted three key differences:

1. Tighter price gaps — Gaps to private label contracted significantly vs. the $1+ gaps in 2022
2. Store-wide inflation — Average item costs up 25-30% across stores may provide insulation
3. Gradual increases — Quarterly price increases are more effective than large semiannual moves

Private Label Bid Activity: Management flagged increased bid activity in store brands due to the macro environment. CFO Lowe noted:

"We have near-term headwinds, we also have wins that you'll start to see flow through the business, particularly in the back half of the year."

Distribution Momentum: Reynolds picked up approximately 5 points of distribution in Q4, with management expressing optimism heading into the May-June shelf resets based on their share performance.

2026 Cost Dynamics: Management guided for 2-3 points of cost headwinds in 2026 (down from 2-4 points in 2025), with roughly half from 2025 cost carryover. Similar pricing actions are planned to offset.

Capital Allocation Update

Reynolds maintained its shareholder-friendly capital allocation, declaring a quarterly dividend of $0.23 per share payable February 27, 2026 to shareholders of record as of February 13, 2026.

The company reduced total debt from $1,686M to $1,580M year-over-year, bringing net debt leverage to 2.1x adjusted EBITDA.

Forward Catalysts

Near-term (Next 1-2 Quarters):

• Q1 2026 results to validate segment reorganization progress
• Realization of cost savings and productivity initiatives launched in 2025
• Continued share gains in store brand food bags through Presto Products

Medium-term:

• Potential stabilization in foam tableware category
• Benefits from increased automation investments
• Pricing actions to offset commodity and tariff headwinds

Risks to Monitor:

• Intensifying promotional activity from waste bag competitors could pressure volumes and margins
• Continued foam category decline accelerating retail volume pressures
• Private label bid activity creating near-term headwinds in store brand business
• Higher-than-expected commodity costs eroding margins
• Foil elasticity risk increasing with each subsequent price increase

The Bottom Line

Reynolds delivered operationally solid Q4 results with a revenue beat and in-line adjusted EPS, but the soft 2026 guidance was the clear takeaway. The ~20% cut to EPS expectations (from ~$2.00 consensus to $1.57-$1.63 guidance) signals management is prioritizing investment in the business over near-term earnings growth.

For income-focused investors, the 4.2% dividend yield at current prices and healthy balance sheet (2.1x leverage) provide support. But growth investors may need to wait for clearer evidence that the strategic investments are translating to improved revenue trajectory before re-engaging with the stock.

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Read the full Q4 2025 8-K filing and earnings call transcript.