Smurfit Westrock (NYSE: SW) sales rise but EBITDA falls 7.5% in third quarter

Posted by Grant Hamersma on Oct 28th, 2026

What happened

Smurfit Westrock plc (NYSE: SW) reported third-quarter Adjusted EBITDA of $1.21 billion, down from $1.30 billion a year earlier.

Net sales rose 2.0% to $8.16 billion from $8.00 billion, so profit fell while revenue grew. The Adjusted EBITDA margin slipped to 14.8% from 16.3%, a drop of 1.5 percentage points.

The company now estimates full-year 2026 Adjusted EBITDA at approximately $4.7 billion. CEO Tony Smurfit said the outlook mainly reflects continued and unprecedented cost inflation. The company expects to absorb approximately $700 million of additional freight and energy costs in 2026, more than it expected.

Smurfit said the company is raising prices to more than offset those costs. The full benefits should arrive into 2027.

Key numbers

Metric	Latest	Change	Source
Q3 Adjusted EBITDA	$1.21 billion	from $1.30 billion, -7.5%	Calculated from SEC 8-K
Q3 Adjusted EBITDA margin	14.8%	from 16.3%, -1.5 percentage points	Calculated from SEC 8-K
Q3 net sales	$8.16 billion	from $8.00 billion, +2.0%	Calculated from SEC 8-K
Q3 net income	$219 million	from $245 million, -10.6%	Calculated from SEC 8-K
Q3 operating cash flow	$874 million	from $1.13 billion, -22.9%	Calculated from SEC 8-K
FY2026 Adjusted EBITDA estimate	approximately $4.7 billion		SEC 8-K, Exhibit 99.1

Where the profit slipped

Sales grew in all three regions, but Adjusted EBITDA fell in two of them. North America earned $760 million, down from $810 million, and its margin on aggregate sales fell to 15.6% from 17.2%.

Europe, the Middle East, Africa and Asia-Pacific earned $379 million, down from $419 million, with the margin at 13.4% against 14.8%. Smurfit said containerboard price increases there are being passed on with the normal time lag.

Latin America was the exception. Its Adjusted EBITDA rose to $126 million from $116 million and its margin edged up to 21.4% from 21.3%. During the quarter the company also announced a deal to acquire the containerboard assets of CMPC in Chile.

In North America, Smurfit said the company remains sold out in all containerboard grades and most consumer grades. He also said converting volumes across the company were somewhat weaker than expected.

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Earnings, cash and the dividend

Net income fell to $219 million from $245 million, and basic earnings per share were $0.42 against $0.47. Adjusted basic EPS fell further, to $0.45 from $0.58. Impairment and restructuring costs of $26 million, down from $65 million, are left out of the adjusted figure. That is one reason GAAP earnings fell by less.

Net cash from operating activities was $874 million, down from $1.13 billion. Capital expenditures were $514 million, against $610 million a year earlier. Operating cash flow minus capital spending came to $360 million, which covered the $238 million of dividends paid in the quarter.

The board approved a quarterly dividend of $0.4523 per ordinary share.

Why it matters

OptimistFi has argued that the July 2024 combination should create a scaled global platform whose savings and customer breadth outweigh box-cycle volatility. The quarter gives mixed evidence. Sales grew in every region, which fits the breadth argument. But profit fell in the two largest regions.

The pressure goes beyond one quarter. Nine-month Adjusted EBITDA was $3.42 billion against $3.77 billion a year earlier, and the nine-month margin was 14.3% against 16.0%.

Relief is slow. Management says the cost burden is larger than it expected and that price increases will not be fully felt until 2027. Until then, margins depend on how fast the company can pass costs on to customers.

What's next

Management was due to host an earnings call at 7:30 AM ET on Oct. 28. The dividend is payable Dec. 10 to holders of record on Nov. 13.

The next test is the fourth-quarter report. Taking nine-month Adjusted EBITDA from the full-year estimate leaves about $1.28 billion for the fourth quarter, above the third-quarter level. A result near that figure with a margin above 14.8% would support management's view that price increases are catching up with costs. A lower result would suggest cost pressure is outrunning pricing.