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Why Is Smurfit Westrock (SW) Down 0.7% Since Last Earnings Report?

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A month has gone by since the last earnings report for Smurfit Westrock (SW - Free Report) . Shares have lost about 0.7% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Smurfit Westrock due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.

SW Misses Q3 Earnings Estimates, Lowers FY25 EBITDA View

Smurfit Westrock reported earnings of 58 cents per share in third-quarter 2025, missing the Zacks Consensus Estimate of 68 cents by 14.7%. The company reported earnings of 53 cents in the year-ago quarter.

Smurfit Westrock was created through the merger of two major paper and packaging industry players, Smurfit Kappa and WestRock, on July 5, 2024. The combined company has been reporting unified results since the third quarter of 2024. However, the year-ago quarter results excluded the financial results of legacy WestRock for the first five days of July as the combination closed on July 5, 2024.

Smurfit Westrock’s net sales in the third quarter of 2025 were $8 billion, which beat the Zacks Consensus Estimate of $7.98 billion. The year-ago quarter’s sales were $7.67 billion.

SW Reports Higher Gross Profit & Adjusted EBITDA

The reported cost of sales was $6.43 billion in the third quarter of 2025, up 1.8% year over year. The gross profit increased 16% year over year to $1.57 billion. The gross margin was 19.6% compared with 17.6% in the year-ago quarter.

Selling, general and administrative expenses were down 4.7% year over year to $960 million. Operating profit was $526 million, marking a significant improvement from $55 million reported in the year-ago quarter.

The adjusted EBITDA was $1.3 billion compared with $1.26 billion in the year-ago quarter. The adjusted EBITDA margin was 16.3% compared with 16.5% in the year-ago quarter.

SW’s Segment Performances in Q3

The company operates under three reportable segments.

Europe, MEA & APAC: This segment includes operations in Europe, the Middle East and Africa, and the Asia Pacific. Sales for the segment were $2.82 billion, up 6.5% year over year. The segment’s adjusted EBITDA was up 2% year over year to $419 million.

North America: This segment includes operations in the United States, Canada and Mexico. Sales for the North America segment were $4.6 billion, a 2% increase from the year-ago quarter. The segment’s adjusted EBITDA rose 4% to $810 million from the year-ago quarter’s $780 million.

LATAM: This segment includes operations in Central America and the Caribbean, Argentina, Brazil, Chile, Colombia, Ecuador and Peru. Sales for this segment were $545 million, up 10% year over year. The segment’s adjusted EBITDA was $116 million, in line with the year-ago quarter.

Smurfit Westrock’s Cash Position & Balance Sheet Updates

SW had cash and cash equivalents of $851 million at the end of the third quarter of 2025, compared with $855 million as of the end of 2024.

Net cash provided by operating activities was $1,133 million compared with $320 million in the year-ago quarter. The company announced a quarterly dividend of 43.08 cents per share. It will be paid out on Dec. 18, 2025, to shareholders of record at the close of business on Nov. 14, 2025.

SW Lowers FY25 Adjusted EBITDA Outlook

Smurfit Westrock expects adjusted EBITDA in 2025 to be $4.9-$5.1 billion, lower than the earlier projection of $5-$5.2 billion. This reflects additional economic downtime in the fourth quarter to optimize its system.

The company had reported 2024 adjusted EBITDA of $4.7 billion.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in estimates review.

The consensus estimate has shifted -28.65% due to these changes.

VGM Scores

At this time, Smurfit Westrock has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for value investors.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Smurfit Westrock has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.


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