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WEYERHAEUSER CO (WY)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 revenue was $1.884B and GAAP EPS was $0.12; EPS and revenue exceeded S&P Global consensus ($0.091 EPS, $1.843B revenue) while EBITDA missed consensus; Adjusted EBITDA was $336M, up slightly Q/Q but down Y/Y . EPS/revenue consensus: $0.091 / $1.843B; EBITDA consensus: $321M; SPGI actual EBITDA: $285M (note definition difference)*.
  • Management emphasized resilient operations amid softer spring building season, increased Q2 share repurchases ($100M at $25.74 avg) and a new $1B authorization, with planned Q3 segment outlooks broadly softer or comparable .
  • Real Estate, Energy & Natural Resources (RE&NR) surged on timing/mix of sales (Adjusted EBITDA $143M), while Wood Products saw pricing pressure (lumber -2% Q/Q, OSB -12% Q/Q), and Timberlands faced seasonal Western cost headwinds .
  • Strategic portfolio actions: acquisition of 117K acres in NC/VA ($375M) to enhance Southern Timberlands cash flows, and sale of Princeton, B.C. mill (≈CAD120M), expected gain on sale; both framed as portfolio optimization catalysts .
  • Q3 setup: Timberlands EBITDA guided ≈$10M lower vs Q2; RE&NR EBITDA ≈$80M lower; Wood Products comparable excluding realizations; tariff/duty dynamics on Canadian lumber and lean inventories could catalyze lumber pricing stabilization or upside .

What Went Well and What Went Wrong

What Went Well

  • RE&NR delivered a strong quarter: Net sales $154M, net contribution $106M, Adjusted EBITDA $143M, driven by favorable timing/mix, higher acres sold, and lower basis percentage . “Earnings and Adjusted EBITDA increased significantly from the first quarter due to the timing and mix of real estate sales” .
  • Capital returns and authorization increased: $100M buybacks in Q2 (avg price $25.74), prior $1B program completed, new $1B authorization announced; base dividend $0.21 per share declared in May . “We’ve returned more than $5.7B of cash back to shareholders” .
  • Southern Timberlands resilience: Slightly higher fee harvest volumes and realizations vs Q1; export to Japan saw moderately higher realizations amid lower European imports; CEO highlighted gaining market share with Japanese customers .

What Went Wrong

  • Wood Products pricing headwinds: Lumber realizations -2% Q/Q; OSB realizations -12% Q/Q; Wood Products Adjusted EBITDA fell to $101M (from $161M in Q1 and $225M in Q2 2024) amid softer spring season and maintenance downtime .
  • Timberlands seasonal cost pressure: Western per unit log/haul and forestry/road costs were seasonally higher; Timberlands Adjusted EBITDA declined Q/Q to $152M (from $167M in Q1), down Y/Y vs $147M in Q2 2024 .
  • EBITDA missed S&P Global consensus: SPGI EBITDA actual was $285M vs $321M consensus (company reports Adjusted EBITDA of $336M, a non-GAAP measure not directly comparable to SPGI EBITDA), reflecting pricing and cost mix headwinds in Wood Products and seasonal Timberlands costs *.

Financial Results

MetricQ2 2024Q1 2025Q2 2025
Revenue ($USD Billions)$1.939 $1.763 $1.884
Net Earnings ($USD Millions)$173 $83 $87
Diluted EPS ($USD)$0.24 $0.11 $0.12
Operating Income ($USD Millions)$270 $179 $178
Adjusted EBITDA ($USD Millions, company-defined)$410 $328 $336
Net Cash from Operations ($USD Millions)$432 $70 $396
Adjusted FAD ($USD Millions, company-defined)$316 $(7) $311

Segment breakdown:

Segment / Metric ($USD Millions)Q2 2024Q1 2025Q2 2025
Timberlands – Net Sales$555 $534 $529
Timberlands – Net Contribution to Pretax Earnings$81 $102 $88
Timberlands – Adjusted EBITDA$147 $167 $152
RE&NR – Net Sales$109 $94 $154
RE&NR – Net Contribution to Pretax Earnings$59 $56 $106
RE&NR – Adjusted EBITDA$102 $82 $143
Wood Products – Net Sales$1,421 $1,287 $1,357
Wood Products – Net Contribution to Pretax Earnings$196 $106 $46
Wood Products – Adjusted EBITDA$225 $161 $101

Selected KPIs:

KPIQ2 2024Q1 2025Q2 2025
West Delivered Logs Realization ($/ton)$118.11 $118.52 $117.69
South Delivered Logs Realization ($/ton)$36.89 $37.10 $37.71
Lumber Third-Party Sales Realization ($/MBF)$419 $463 $454
OSB Third-Party Sales Realization ($/MSF 3/8")$407 $317 $280
EWP Operating Rate (approx.)low–mid 70% ~70% high 70s (Q2); guided lower in Q3

Estimates vs Actuals (S&P Global):

MetricQ2 2025 ConsensusQ2 2025 ActualSurprise
EPS ($USD)$0.09102*$0.12 Beat
Revenue ($USD Billions)$1.84348*$1.884 Beat
EBITDA ($USD Millions, SPGI)$320.69*$285.00*Miss

*Values retrieved from S&P Global. Note: Company reports Adjusted EBITDA ($336M) which is a non-GAAP measure not directly comparable to SPGI EBITDA .

Non-GAAP adjustments:

  • Q2 2024 included a $25M pretax product remediation recovery in Wood Products; net earnings before special items were $154M vs GAAP $173M; EPS before special items $0.21 vs $0.24 .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Timberlands Earnings & Adjusted EBITDAQ3 2025N/A≈$10M lower vs Q2 2025 Lower
RE&NR Adjusted EBITDAFull-year 2025~$350M ~$350M; basis 30–40% for full year Maintained
RE&NR Earnings & Adjusted EBITDAQ3 2025N/AEarnings ≈$60M lower; Adjusted EBITDA ≈$80M lower vs Q2 Lower
Wood Products Earnings & Adjusted EBITDAQ3 2025N/AComparable to Q2, excluding changes in lumber/OSB realizations Maintained (ex-realizations)
Typical CapEx Program (ex-Monticello)FY 2025~$440M (Q4’24 outlook) Lowered to ≈$400M (ex-Monticello) Lower
Monticello EWP Facility CapExFY 2025~$120M (Q4’24 outlook) ≈$130M; total project ~$500M through 2027; excluded from Adjusted FAD Raised (annual)
DividendOngoingBase $0.21/qtr (5% increase Feb’25) Base $0.21/qtr (declared May 8) Maintained
Share Repurchase AuthorizationOngoingPrior $1B program completed New $1B authorization Raised capacity

Earnings Call Themes & Trends

TopicQ4 2024 (Prior-2)Q1 2025 (Prior-1)Q2 2025 (Current)Trend
Tariffs/macro (softwood duties; Section 232)Discussed potential tariff impacts and lean lumber inventories; OSB costs Buyers cautious; inventory hesitancy; tariff uncertainty; potential SPF→SYP substitution Duties increasing (SPF 14%→34%); could support lumber pricing; Section 232 uncertainty Intensifying focus; potential pricing support
Regional trends (Japan/China/India)Japan soft Q4 but expected improvement; reduced China shipments Paused China shipments after import ban; Japan demand improving Japan share gains sustainable; China reopening unlikely near-term; pivot to India Japan strength; China paused; India opportunity
Wood Products pricing and demandLumber/OSB pricing improved Q4; seasonal slowdown later Lumber realizations up; OSB down; EWP impacted by MDF outage Lumber -2% Q/Q; OSB -12% Q/Q; EWP volumes up but realizations lower; distribution softer Mixed; pricing pressure Q2
RE&NR growth incl. climate solutionsNCS EBITDA $84M in 2024; pipeline building Expect significant increase in forest carbon credits (5x–10x) Third forest carbon project approved; tracking to $100M NCS EBITDA by YE 2025 Strengthening
Capital allocationBalance sheet strong; cash returns in 2024 $25M Q1 buybacks; dividend increased; flexible framework $100M Q2 buybacks; new $1B authorization; CapEx flexibility More aggressive buybacks
EWP R&D / capacityAnnounced TimberStrand Arkansas project; $500M; $100M EBITDA target MDF outage resolved; EWP volumes to improve Q2 EWP volumes up; operating posture improved; Q3 sales volumes guided lower Execution progressing

Management Commentary

  • “Our teams delivered solid operating performance in the second quarter… we significantly increased our share repurchase activity… and continue to enhance the value of our timberlands portfolio with high-quality and strategically located acreage.” — Devin Stockfish, CEO .
  • “We generated $396 million of cash from operations… share repurchase activity totaled $100 million in the second quarter… new $1 billion authority… notable achievements that underscore the durability of our portfolio.” — David Wold, CFO .
  • “For our OSB business, adjusted EBITDA was $30 million… average sales realizations decreased by 12%, which was favorable to the OSB composite… unit manufacturing costs increased due to additional downtime for planned annual maintenance.” — Devin Stockfish .
  • “We continue to expect full year 2025 adjusted EBITDA of approximately $350 million [RE&NR]… third quarter adjusted EBITDA will be approximately $80 million lower.” — David Wold .

Q&A Highlights

  • Tariff/duty dynamics: Management expects increased duties on Canadian lumber to support pricing; Section 232 outcomes remain uncertain; industry likely avoids operating below cash flow breakeven for sustained periods .
  • EWP outlook: Prices pressured by softer single-family activity; catalysts include housing/R&R recovery and recapturing share from open web trusses; Q3 operating rates guided lower .
  • RE&NR price/acre mix: Variability driven by mix (more Western acres boosted per-acre pricing); conviction that timberland valuations rise over time .
  • Capital allocation and leverage: Strong balance sheet supports opportunistic repurchases despite project spend; flexibility preserved for Monticello ramp and timberland divestiture funding (1031 exchange timing acknowledged) .

Estimates Context

  • WY beat S&P Global consensus on EPS ($0.12 vs $0.091*) and revenue ($1.884B vs $1.843B*), but missed on SPGI EBITDA ($285M* vs $321M*). Company-reported Adjusted EBITDA was $336M, a non-GAAP measure used internally, and not directly comparable to SPGI EBITDA *.
  • Estimate revisions likely: EWP and OSB pricing pressure plus Q3 segment guidance (Timberlands/RE&NR lower) suggest downward adjustments to near-term EBITDA, while tariff-related pricing support and lean inventories could temper downside for lumber realizations .
    *Values retrieved from S&P Global.

Key Takeaways for Investors

  • Q2 quality beat on EPS/revenue with resilient cash generation ($396M CFO) despite pricing headwinds; watch mix-driven strength in RE&NR as timing normalizes in Q3 .
  • Wood Products cadence: Expect Q3 EBITDA broadly comparable ex-realizations; monitor lumber duty implementations and inventory behavior as potential catalysts for price stabilization/upside .
  • Timberlands seasonal trough ahead: Q3 earnings/EBITDA ≈$10M lower vs Q2; Western costs/realizations drive near-term pressure; Japan export realizations support .
  • Capital return is a tangible support: $100M Q2 repurchases and new $1B authorization provide buyback optionality; base dividend maintained at $0.21 .
  • Strategic portfolio optimization: NC/VA timberland acquisition adds portfolio-leading cash flows; Princeton mill sale simplifies footprint with expected gain — both could aid medium-term return profile .
  • Non-GAAP framing matters: Company’s Adjusted EBITDA ($336M) differs from SPGI EBITDA; use company reconciliation for operational trend analysis; be cautious comparing across sources .
  • Trading setup: Near-term softness in RE&NR and seasonal Timberlands, offset by potential lumber pricing support from duty changes and lean inventories; catalysts include duty effective dates and any Fed rate cuts improving R&R demand .