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WEYERHAEUSER CO (WY)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025: Net sales $1.717B, GAAP EPS $0.11; excluding special items, EPS $0.06; Adjusted EBITDA $217M; Street expected a loss on EPS and lower revenue, so results were modest beats versus consensus and a significant positive EPS surprise on an adjusted basis .
  • Segment backdrop: Timberlands steady (Adjusted EBITDA $148M), Real Estate, Energy & Natural Resources (RE&NR) down sequentially on mix ($91M), and Wood Products deeply pressured by historically low lumber/OSB prices (Adjusted EBITDA $8M; pretax special gain $29M from Princeton mill sale) .
  • Guidance: Raised FY25 RE&NR Adjusted EBITDA to $390M (from $350M) and set Q4 cadence lower sequentially for Timberlands ($30M down) and Wood Products (slightly lower, excl. price changes). Basis for real estate sales guided to 25–30% for FY25 .
  • Strategic actions: Completed $459M timberlands acquisitions; advanced/closed divestitures totaling $410M (proceeds expected to exceed cash outlay); completed Princeton B.C. mill sale ($85M gross; ~$61M received at closing) .
  • Capital allocation: $150M YTD share repurchases through Q3; board reaffirmed base dividend of $0.21 per share (Nov. 13 declaration) .

What Went Well and What Went Wrong

What Went Well

  • Positive adjusted EPS and revenue vs consensus: Adjusted EPS $0.06 (Street expected loss) and net sales $1.717B (above ~$1.661B est.), signaling resilient execution despite weak pricing .
  • RE&NR outlook upgrade: Raised FY25 Adjusted EBITDA guidance to ~$390M; basis % refined to 25–30%, supported by strong demand/pricing for HBU properties .
  • Portfolio optimization: Two acquisitions ($459M) and divestitures progressing ($410M expected by year-end; total proceeds expected to exceed outlay), enhancing long-term cash flow and asset quality .
  • Management tone: “We remain well positioned to navigate the current environment… and maintain a favorable outlook for longer-term demand fundamentals” — CEO Devin Stockfish .

What Went Wrong

  • Severe Wood Products pressure: Adjusted EBITDA fell to $8M; lumber realizations -11% and OSB -18% sequentially; distribution softer on volumes .
  • Sequential EBITDA decline: Company Adjusted EBITDA declined from $336M in Q2 to $217M in Q3, reflecting pricing and mix headwinds .
  • Q4 outlook softer: Timberlands guided ~$30M EBITDA lower; RE&NR ~$15M lower; Wood Products slightly lower (ex-price changes) given seasonal demand moderation and maintenance .

Financial Results

MetricQ1 2025Q2 2025Q3 2025
Net Sales ($USD Billions)$1.763 $1.884 $1.717
GAAP Diluted EPS ($)$0.11 $0.12 $0.11
EPS Before Special Items ($)$0.11 $0.12 $0.06
Adjusted EBITDA ($USD Millions)$328 $336 $217
Operating Income ($USD Millions)$179 $178 $123
Gross Margin ($USD Millions)$335 $325 $204
MarginQ1 2025Q2 2025Q3 2025
EBITDA Margin (%)18.6% (328/1763) 17.8% (336/1884) 12.6% (217/1717)
Operating Margin (%)10.2% (179/1763) 9.5% (178/1884) 7.2% (123/1717)

Segment Breakdown

SegmentNet Sales ($MM) Q2Net Sales ($MM) Q3Net Contrib. to Pretax Earnings ($MM) Q2Net Contrib. to Pretax Earnings ($MM) Q3Adjusted EBITDA ($MM) Q2Adjusted EBITDA ($MM) Q3
Timberlands$529 $536 $88 $80 $152 $148
RE&NR$154 $103 $106 $69 $143 $91
Wood Products$1,357 $1,228 $46 $(19) $101 $8

Key Operating KPIs

KPIQ2 2025Q3 2025
Lumber: 3rd-party sales volumes (MM board feet)1,277 1,259
Lumber: realizations ($/MBF)$454 $405
OSB: 3rd-party sales volumes (MM sqft 3/8")731 727
OSB: realizations ($/MSF 3/8")$280 $231
EWP I-joists: volumes (MM lineal ft)40 35
EWP I-joists: realizations ($/lineal ft)$2,399 $2,421
Net Cash from Operations ($MM)$396 $210
Adjusted FAD ($MM)$311 $117

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Timberlands: Earnings before special items & Adjusted EBITDAQ4 2025N/A~$30M lower vs Q3 Lower
RE&NR: Adjusted EBITDAFY 2025~$350M ~$390M Raised
RE&NR: Basis as % of real estate salesFY 202530–40% 25–30% Lower basis %
Wood Products: Earnings before special items & Adjusted EBITDA (ex price changes)Q4 2025N/ASlightly lower vs Q3 Lower
Monticello EWP facility CapExFY 2025N/A~$130M Set
Typical CapEx (ex Monticello)FY 2025N/ALowered to $380–$390M Lower
Natural Climate Solutions EBITDAFY 2025N/AOn track to ~$100M by YE Affirmed
Dividend (base)Q4 2025$0.21 (ongoing)$0.21 declared Nov. 13, payable Dec. 12 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2025)Previous Mentions (Q1 2025)Current Period (Q3 2025)Trend
Lumber/OSB pricing & demandQ2: Lumber realizations -2%, OSB -12%; Q3 expected comparable ex price changes Q2 outlook: modest improvements; EWP volumes expected higher Lumber realizations -11%, OSB -18%; historically low pricing; moderated production; Q4 slightly lower ex price changes Worsening in Q3; stabilization expected near-term
Japan log exportsQ2: Japan export realizations moderately higher Q1: Higher volumes to Japan offset China weakness Japan market softened; inventories up; realizations moderately lower; expect normalization; freight aids Q4 realizations Near-term soft; constructive medium-term
Timberlands portfolio optimizationAnnounced NC/VA acquisition; mill sale announced No major portfolio announcements in Q1 PRTwo acquisitions $459M; divestitures $410M expected by YE; proceeds to exceed outlay Accelerating execution
RE&NR/HBU pricingStrong Q2 mix; higher acres/price per acre Higher avg price/acre vs Q4 FY25 EBITDA raised to ~$390M; strong demand/pricing for HBU Strengthening
Tariffs/macroN/AN/AElevated duties and new 232 tariff to support lumber pricing; housing starts ~1.3M; affordability headwinds Macro/tariffs supportive over time
Pulpwood/fiber markets (South)Fiber costs slightly higher; stable Comparable conditions Pulp/paper closures; takeaway steady via delivered programs; OSB mills absorb some fiber Mixed; manageable with integration
CapEx/Monticello EWPProject capex included/excluded in FAD Monticello capital noted ~$500M project through 2027; ~$130M FY25; typical CapEx lowered Ongoing execution

Management Commentary

  • “Our performance in the third quarter reflects solid execution against a very challenging market backdrop… we maintain a favorable outlook for the longer-term demand fundamentals” — Devin W. Stockfish, CEO .
  • “We completed two high-quality acquisitions totaling $459 million… divestitures expected to exceed cash outlay required for acquisitions” — press release summary .
  • CFO: “Ended the quarter with ~$400M cash and total debt just under $5.5B… secured three-year $800M term loan at 4.3% and prepaid $500M of 2026 maturities” .
  • On Wood Products: “Lumber and OSB prices reached historically low levels on an inflation-adjusted basis… we moderated production; expect typical winter softening but tariffs/duties support pricing” .

Q&A Highlights

  • Capacity/operating posture: Moderated lumber production (~10% lower in Q4 QoQ if continued), OSB posture monitored; best-in-class cost curve positioning; roadmap for first-quartile cost across mills .
  • Timberlands M&A economics: Since 2020, buy/sell activity increased annual EBITDA ~$50M; 21x EBITDA multiple for acquisitions vs 45x for divestitures; integrated scale unlocks value .
  • Leverage/guardrails: Net debt/EBITDA optically elevated due to trough wood products; committed to investment-grade; expect normalization as EBITDA recovers .
  • Market dynamics: Japan inventory destock driven by permitting changes; expected to normalize; European lumber facing cost headwinds; customers in Japan gaining share .
  • Fiber/pulpwood: Southern pulp closures; integration allows rerouting fiber to OSB and other customers; Monticello will utilize pulpwood in-region .
  • Natural climate solutions: On track to ~$100M EBITDA by YE; 45Q tax credit intact; partners’ pipelines robust despite rhetoric shifts .

Estimates Context

How results compared to Wall Street consensus (S&P Global):

MetricQ1 2025 ConsensusQ1 2025 ActualQ2 2025 ConsensusQ2 2025 ActualQ3 2025 ConsensusQ3 2025 Actual
Revenue ($USD Billions)$1.767*$1.763 $1.843*$1.884 $1.661*$1.717
Primary EPS ($)$0.097*$0.11 $0.091*$0.12 -$0.078*$0.06 (before special items)
  • Q3 2025: Revenue beat (~$56M vs consensus) and EPS came in positive vs expected loss; note S&P “Primary EPS” aligns to company’s EPS before special items this quarter (GAAP EPS $0.11, with $0.05 total special items) .
  • EBITDA vs consensus: Company Adjusted EBITDA $217M vs S&P EBITDA consensus ~$158M* — significant beat on operating performance (definitions may differ) .
  • Values marked “*” retrieved from S&P Global.

Key Takeaways for Investors

  • Wood Products headwinds likely persist into Q4, but pricing has stabilized and structural supports (duties/Section 232, lean inventories) could bridge to spring building season; maintain cautious near-term stance .
  • RE&NR provides a counter-cyclical earnings buffer; FY25 EBITDA raised to ~$390M with strong HBU pricing and favorable mix; basis % lower supports margins .
  • Active portfolio management is adding value: acquisitions at 21x EBITDA versus divestitures at ~45x; expected proceeds to exceed acquisition outlay — accretive to long-term cash flow .
  • Timberlands outlook softer in Q4 (West domestic realizations, lower volumes), but seasonal cost relief and freight benefits in Japan partially offset; medium-term export dynamics constructive .
  • Balance sheet/liquidity intact; term loan at 4.3% and prepaid maturities de-risk 2026; ongoing share repurchases and base dividend reaffirmed .
  • Natural Climate Solutions nearing ~$100M EBITDA run-rate by YE; diversified growth lever independent of lumber/OSB cycles .
  • Tactical trading: Positive EPS surprise and revenue beat vs consensus could underpin near-term sentiment; however, weak commodity pricing and softer Q4 guide temper upside — watch for tariff dynamics and spring demand catalysts .
Notes:
- All company performance figures and segment data are sourced from Weyerhaeuser’s Q3 2025 Form 8‑K (including Exhibits 99.1 and 99.2) and press releases. 
- Consensus estimates marked with * are values retrieved from S&P Global.

Citations:
**[106535_0001193125-25-258510_wy-ex99_1.htm:1]** **[106535_0001193125-25-258510_wy-ex99_1.htm:3]** **[106535_0001193125-25-258510_wy-ex99_1.htm:4]** **[106535_0001193125-25-258510_wy-ex99_1.htm:8]** **[106535_0001193125-25-258510_wy-ex99_1.htm:9]** **[106535_0001193125-25-258510_wy-ex99_2.htm:0]** **[106535_0001193125-25-258510_wy-ex99_2.htm:5]** — Q3 2025 8-K and Analyst Package
**[0000106535_2221489_3]** **[0000106535_2221489_4]** **[0000106535_2221489_5]** **[0000106535_2221489_6]** **[0000106535_2221489_14]** **[0000106535_2221489_15]** **[0000106535_2221489_17]** — Q3 2025 earnings call transcript
**[0000106535_2224107_4]** **[0000106535_2224107_7]** **[0000106535_2224107_11]** **[0000106535_2224107_12]** **[0000106535_2224107_13]** **[0000106535_2224107_16]** **[0000106535_2224107_17]** — Q3 2025 earnings call transcript (alternate feed)
**[106535_20251030SF11615:0]** **[106535_20251030SF11615:1]** — Portfolio optimization press release
**[106535_20251030SF11625:0]** — Q3 2025 earnings PR notice
**[106535_20250902SF63893:0]** — Princeton mill sale PR
**[106535_0000950170-25-098338_wy-ex99_1.htm:3]** **[106535_0000950170-25-098338_wy-ex99_1.htm:4]** **[106535_0000950170-25-098338_wy-ex99_1.htm:8]** **[106535_0000950170-25-098338_wy-ex99_2.htm:0]** **[106535_0000950170-25-098338_wy-ex99_2.htm:3]** **[106535_0000950170-25-098338_wy-ex99_2.htm:4]** **[106535_0000950170-25-098338_wy-ex99_2.htm:5]** **[106535_0000950170-25-098338_wy-ex99_2.htm:6]** — Q2 2025 8-K and Analyst Package
**[106535_0000950170-25-058035_wy-ex99_1.htm:1]** **[106535_0000950170-25-058035_wy-ex99_1.htm:2]** **[106535_0000950170-25-058035_wy-ex99_1.htm:5]** **[106535_0000950170-25-058035_wy-ex99_2.htm:2]** **[106535_0000950170-25-058035_wy-ex99_2.htm:3]** **[106535_0000950170-25-058035_wy-ex99_2.htm:4]** — Q1 2025 8-K and Analyst Package
**[106535_20251113SF24559:0]** — Dividend declaration PR