International Paper

“Our operations have been adversely affected and could continue to be adversely affected in the future, by these challenging macroeconomic and geopolitical conditions, including as the result of lower demand for certain products, and higher raw material and labor costs.”

Annual report 2025A · The company itself

“The labor market for both hourly and salaried workers continues to be competitive. For additional information regarding risks related to the current labor market, see Item 1A.”

Annual report 2025A · The company itself

“Our ability to operate and grow our business depends on our ability to attract and retain employees with the skills necessary to operate and maintain our facilities, produce our products and serve our customers. The market for both hourly workers and salaried workers continues to be competitive, particularly for employees with specialized technical and trade experience. This, along with the current competitive labor market and ongoing cost-pressured conditions, has led to higher labor costs.”

Annual report 2025A · The company itself

“If there is a substantial change to the terms of any collective bargaining agreements or an agreement acceptable to us cannot be reached at all when the collective agreements are renewed, we could face increased labor costs or disruptions as a result of labor union activity in the future.”

Annual report 2025A · The company itself

“Moreover, the availability of labor and the market price for fuel may affect third-party transportation costs.”

Annual report 2025A · The company itself

“The attraction, retention and development of our employees is critical to our success. We strive to create a positive employee experience that begins at onboarding.”

Annual report 2025A · The company itself

“•Financial: Net sales in 2025 totaled $23.63 billion and cash provided by operating activities totaled $1.7 billion. •Strategic Acquisition: Completed the acquisition of DS Smith Ltd.”

Annual report 2025A · The company itself

“A critical priority will be the execution of the strategic separation to create two independent, publicly traded companies in North America and EMEA, which we aim to complete near the end of 2026 or early 2027. In North America, the business will continue strengthening its position in the region, focusing on customers and leading on innovation with an advantaged cost position. In EMEA, we will prepare the business to stand alone as an independent, publicly traded entity following the separation with the goal of becoming the leading provider of innovative, sustainable packaging solutions in EMEA.”

Annual report 2025A · The company itself

“Our strategy for long-term growth, productivity and profitability depends, in part, on our ability to accomplish prudent acquisitions, joint ventures, divestitures, spin-offs, and other strategic corporate transactions and to realize the benefits expected from such transactions, including the planned separation of our EMEA packaging business.”

Annual report 2025A · The company itself

“The proposed separation is complex, and completion of the proposed separation and the timing of its completion will be subject to a number of factors and conditions, including the readiness of the new company to operate as an independent public company, the successful integration of both legacy DS Smith and International Paper businesses in EMEA into one packaging business and finalization of the capital structure of the new company.”

Annual report 2025A · The company itself

“Throughout 2025, we continued to execute a multi‑year transformation designed to simplify our portfolio, sharpen our regional focus and improve underlying earnings power. The Company undertook significant strategic and operational changes driven largely by our 80/20 performance system, the integration of DS Smith and the divestiture of our Global Cellulose Fibers ("GCF") business.”

Annual report 2025A · The company itself

“The Company acquired DS Smith in early 2025 for an enterprise value of approximately $9.9 billion.”

Annual report 2025A · The company itself

“Focusing on our core business: sustainable packaging solutions Concentrating on the right geographies within each region Tailoring investment and capital allocation strategies to meet distinct needs Winning with customers and providing superior customer experiences Exiting non-core businesses Planning to separate into two independent, publicly traded companies in North America and EMEA (announced Jan 2026) Investing in greenfield packaging facilities; plans for two new plants announced in 2025 Enhancing investor base in both North America and EMEA Optimizing internal processes and organizational structures to reduce complexity Prioritizing the right customer segments and product offerings Investing in our talent and putting the right people in the right roles to create value Focusing on achieving an advantaged cost position We remain confident that the initiatives undertaken as part of our transformational journey will unlock substantial value at IP and strengthen the Company for our employees, customers and shareholders.”

Annual report 2025A · The company itself

“International Paper Company (the "Company," "International Paper" or "IP", which may also be referred to as "we" or "us") is a global leader in sustainable packaging solutions.”

Annual report 2025A · The company itself

“The Company manufactures a broad range of containerboard and corrugated packaging products, which are used to protect, ship and display goods across diverse end-use categories. Our containerboard portfolio includes linerboard, medium, whitetop, and saturating kraft, which serve as the base materials for corrugated packaging. The Company converts containerboard into corrugated boxes, bulk bins, shipping containers and specialty packaging through its network of U.S. and international converting facilities.”

Annual report 2025A · The company itself

“The majority of our business is focused on creating fiber-based packaging that protects and promotes goods, enables worldwide commerce and helps keep consumers safe. We meet our customers’ most challenging sales, shipping, storage and display requirements with sustainable solutions.”

Annual report 2025A · The company itself

“Containerboard includes linerboard, medium, whitetop, recycled linerboard, recycled medium and saturating kraft. Approximately 75% of our production is converted into corrugated packaging and other packaging by our 170 North American corrugated packaging plants.”

Annual report 2025A · The company itself

“Volatile and increasing energy prices, including as a consequence of the conflict between Russia and Ukraine as well as heightened geopolitical tensions in regions such as the Middle East, China, and recent events in Venezuela, or a failure to effectively implement such strategies and tools could have a material adverse effect on our business, financial condition, results of operations and/or future prospects.”

Annual report 2025A · The company itself

“These risks, which can vary substantially by country, may include economic or political instability, geopolitical events, corruption, anti-American sentiment, expropriation measures, social and ethnic unrest, natural disasters, military conflicts and terrorism, the regulatory environment (including the risks of operating in developing or emerging markets in which there are significant uncertainties regarding the interpretation and enforceability of legal requirements and the enforceability of contractual rights and intellectual property rights), adverse currency fluctuations, foreign exchange control regimes (including restrictions on currency conversion), downturns or changes in economic conditions (including in relation to commodity inflation), adverse tax consequences or rulings, import restrictions, controls or other trade protection measures, economic sanctions, health guidelines and safety protocols, nationalization, changes in social, political or labor conditions, and adverse developments regarding sustainability, environmental regulations and trade policies and agreements, any of which risks could negatively affect our financial results.”

Annual report 2025A · The company itself

“In EMEA, overall demand remained relatively soft throughout 2025 as macroeconomic uncertainty and volatility persisted, influenced by trade uncertainty, geopolitical tensions in the Middle East and the Russia- Ukraine conflict.”

Annual report 2025A · The company itself

“In our packaging business, we exited non-strategic export and specialty markets and rationalized higher cost capacity to better align with profitable customer demand.”

Annual report 2025A · The company itself

“Pricing in the paper and packaging industries can be affected by, among other things, product commoditization, changes in demand, entrance or withdrawal of new competitors or capacity, changes in product supply, and the introduction of new products, technologies and equipment, including the use of artificial intelligence ("AI") and machine learning solutions.”

Annual report 2025A · The company itself

“Such attacks are increasing in complexity, and the rapid evolution and increased adoption of AI technologies may intensify cybersecurity risks by making cyber-attacks more difficult to detect, contain, and mitigate.”

Annual report 2025A · The company itself

“We may fail to identify, prioritize or implement digital and/or AI transformation initiatives. We may fail to identify, prioritize or implement digital and/or AI transformation initiatives across our operations, including areas such as product design, materials sourcing, manufacturing, logistics, and customer delivery.”

Annual report 2025A · The company itself

“The global supply and demand for recycled fiber may be affected by factors such as trade policies between countries, individual governments’ legislation and regulations, and general macroeconomic conditions. In addition, the increase in demand of products manufactured, in whole or in part, from recycled fiber, on a global basis, may cause significant fluctuations in recycled fiber prices.”

Annual report 2025A · The company itself

“We also entered into a definitive agreement to divest our GCF business, positioning the company as a pure play leading sustainable packaging solutions company.”

Annual report 2025A · The company itself

“Additionally, we recycle approximately one million tons of OCC and mixed and white paper through our 15 U.S. recycling plants. Our corrugated packaging plants are supported by regional design centers, which offer total packaging solutions and supply chain initiatives.”

Annual report 2025A · The company itself

“In North America, market demand was weaker than expected throughout most of the year as economic uncertainty from tariffs, slower housing starts, weaker consumer sentiment and lower industrial production negatively impacted box demand.”

Annual report 2025A · The company itself

“These products support customers in industries such as food and beverage, agriculture, industrial manufacturing, personal care pharmaceuticals and consumer goods.”

Annual report 2025A · The company itself

“Demand for our products is closely correlated with non-durable industrial goods production, as well as with demand for e-commerce, processed foods, poultry, meat and agricultural products.”

Annual report 2025A · The company itself

“These products support customers in industries such as food and beverage, agriculture, industrial manufacturing, personal care pharmaceuticals and consumer goods.”

Annual report 2025A · The company itself

“Through the application of our 80/20 performance system, we will execute our strategy with a sharp focus on achieving an advantaged cost position, delivering superior customer experience and capturing a high relative supply position in the right geographies, with the right customers and the right product offerings.”

Annual report 2025A · The company itself

“These products support customers in industries such as food and beverage, agriculture, industrial manufacturing, personal care pharmaceuticals and consumer goods.”

Annual report 2025A · The company itself

“We may fail to identify, prioritize or implement digital and/or AI transformation initiatives. We may fail to identify, prioritize or implement digital and/or AI transformation initiatives across our operations, including areas such as product design, materials sourcing, manufacturing, logistics, and customer delivery.”

Annual report 2025A · The company itself

“We produce renewable fiber-based packaging solutions, primarily servicing industrial consumer goods and e-commerce markets.”

Annual report 2025A · The company itself

“Through the application of our 80/20 performance system, we will execute our strategy with a sharp focus on achieving an advantaged cost position, delivering superior customer experience and capturing a high relative supply position in the right geographies, with the right customers and the right product offerings.”

Annual report 2025A · The company itself

“We produce renewable fiber-based packaging solutions, primarily servicing industrial consumer goods and e-commerce markets.”

Annual report 2025A · The company itself

“These risks, which can vary substantially by country, may include economic or political instability, geopolitical events, corruption, anti-American sentiment, expropriation measures, social and ethnic unrest, natural disasters, military conflicts and terrorism, the regulatory environment (including the risks of operating in developing or emerging markets in which there are significant uncertainties regarding the interpretation and enforceability of legal requirements and the enforceability of contractual rights and intellectual property rights), adverse currency fluctuations, foreign exchange control regimes (including restrictions on currency conversion), downturns or changes in economic conditions (including in relation to commodity inflation), adverse tax consequences or rulings, import restrictions, controls or other trade protection measures, economic sanctions, health guidelines and safety protocols, nationalization, changes in social, political or labor conditions, and adverse developments regarding sustainability, environmental regulations and trade policies and agreements, any of which risks could negatively affect our financial results.”

Annual report 2025A · The company itself

“Additionally, the U.S. government in 2025 increased certain rates and broadened the scope of certain tariffs imposed on goods imported into the U.S., such as from China, which may strain international trade relations and increase the risk that foreign governments implement retaliatory tariffs on goods imported from the United States. Specifically, the U.S. federal government implemented tariffs on certain foreign goods and may implement additional tariffs on foreign goods.”

Annual report 2025A · The company itself

“Tariffs have increased the cost of certain capital items, including materials and equipment used in our capital investments. These increased costs could adversely impact the profit margin that we earn on our products, which could make our products less competitive and reduce consumer demand.”

Annual report 2025A · The company itself

“•Fluctuations in the prices of and the demand for our products due to factors such as economic cyclicality and changes in customer or consumer preferences, and government regulations. •Changes in the cost and availability of raw materials, energy and transportation have recently affected, and could continue to affect, our profitability. •Competition and downward pricing pressure in the global packaging industry could negatively impact our financial results.”

Annual report 2025A · The company itself

“On February 20, 2026, the U.S. Supreme Court struck down several of the sweeping tariffs imposed through a series of executive orders, holding that the tariffs exceeded the authority granted under the International Emergency Economic Powers Act. The Court's ruling eliminated key tariffs on imports from numerous major trading partners and created uncertainty regarding the status of various trade agreements and tariff related obligations.”

Annual report 2025A · The company itself

“In response to the Supreme Court’s decision, the government announced new Executive Orders on February 20, 2026, aimed at restructuring U.S. tariff policy and exploring alternative statutory authorities to impose or maintain tariffs. The scope, timing, and implementation of these Executive Orders remains uncertain, and may result in new or modified tariff regimes, additional regulatory requirements, or further trade friction with U.S. trading partners.”

Annual report 2025A · The company itself

“In North America, market demand was weaker than expected throughout most of the year as economic uncertainty from tariffs, slower housing starts, weaker consumer sentiment and lower industrial production negatively impacted box demand.”

Annual report 2025A · The company itself

“In EMEA, overall demand remained relatively soft throughout 2025 as macroeconomic uncertainty and volatility persisted, influenced by trade uncertainty, geopolitical tensions in the Middle East and the Russia- Ukraine conflict.”

Annual report 2025A · The company itself

“Substantially all of our business has experienced, and is expected to continue to experience, cycles relating to industry capacity, customer demand, and general economic conditions. The length and magnitude of these cycles have varied over time and by product.”

Annual report 2025A · The company itself

“We are affected by developments in general business and economic conditions, which could have an adverse effect on the demand for our products, our financial condition and the results of our operations including our ability to pay a cash dividend. General economic conditions may adversely affect industrial non-durable goods production, consumer confidence and spending, and employment levels, all which impact demand for our products, or otherwise adversely affect our business.”

Annual report 2025A · The company itself

“Further, because the markets for packaging products in many industrialized countries are generally mature, there is a significant degree of correlation between economic growth and demand for packaging products. Therefore, any deterioration in macroeconomic conditions in the U.S., Europe and/or globally resulting in a slowdown in economic growth may correlate with a corresponding decline in demand for packaging products in those markets.”

Annual report 2025A · The company itself

“•Fluctuations in the prices of and the demand for our products due to factors such as economic cyclicality and changes in customer or consumer preferences, and government regulations. •Changes in the cost and availability of raw materials, energy and transportation have recently affected, and could continue to affect, our profitability. •Competition and downward pricing pressure in the global packaging industry could negatively impact our financial results.”

Annual report 2025A · The company itself

“For example, higher prices for transportation, energy and other inputs, as well as more protracted air permitting processes, could cause delays and higher costs to implement capital projects.”

Annual report 2025A · The company itself

“We have significant exposure to energy costs, in particular gas, electricity and other fuel costs. Energy prices have fluctuated dramatically in the past and may continue to increase and/or fluctuate in the future.”

Annual report 2025A · The company itself

“Input costs were lower, driven by lower recovered fiber and wood costs, partially offset by higher energy and chemical costs.”

Annual report 2025A · The company itself

“Cost of products sold decreased $54 million and was impacted by lower volumes, lower operating costs and lower input costs, primarily for energy costs.”

Annual report 2025A · The company itself

“Volatility or uncertainty in the financial, capital and credit markets, and negative developments associated with interest rates, asset values, currency exchange rates and the availability of credit, could also have a material adverse effect on our business, financial condition and results of operations and could adversely affect our liquidity, access to capital markets and ability to pay a dividend.”

Annual report 2025A · The company itself

“Maintaining an investment-grade credit rating is an important element of our financial strategy. A downgrade of ratings below investment grade will likely eliminate our ability to access the commercial paper market, may limit access to the capital markets, have an adverse effect on the market price of our securities, increase borrowing costs and require us to post collateral for derivatives in a net liability position.”

Annual report 2025A · The company itself

“Certain of our debt agreements provide for an interest rate increase in case of a credit rating downgrade. This applies to agreements governing approximately $4.0 billion of our debt as of December 31, 2025.”

Annual report 2025A · The company itself

“As of December 31, 2025, we had approximately $9.8 billion of outstanding indebtedness.”

Annual report 2025A · The company itself

“We have significant exposure to energy costs, in particular gas, electricity and other fuel costs. Energy prices have fluctuated dramatically in the past and may continue to increase and/or fluctuate in the future.”

Annual report 2025A · The company itself

“Input costs were lower, driven by lower recovered fiber and wood costs, partially offset by higher energy and chemical costs.”

Annual report 2025A · The company itself

“Cost of products sold decreased $54 million and was impacted by lower volumes, lower operating costs and lower input costs, primarily for energy costs.”

Annual report 2025A · The company itself

“We are subject to cybersecurity and information technology risks related to breaches of security pertaining to sensitive company, customer, employee and vendor information as well as breaches in the technology used to manage operations and other business processes. Our business operations rely on securely managed information technology systems, some of which are provided or managed by third parties, for data capture, processing, storage and reporting.”

Annual report 2025A · The company itself

“In addition, despite careful security and controls design, implementation, updating, monitoring and independent third-party verification, our information technology systems, together with those of our third-party providers or joint venture partners, have been and could again be compromised or disrupted due to factors such as employee error or malfeasance, cyberattacks, including ransomware, malware, phishing attacks, advanced persistent threats, social engineering, credential stuffing or distributed denial-of-service attacks or data or security breaches by malicious actors such as common hackers, criminal groups or nation-state organizations or social activist (“hacktivist”) organizations, disruptions resulting from geopolitical events, natural disasters, failures or impairments of telecommunications networks or other catastrophic events.”

Annual report 2025A · The company itself

“Taking into account ongoing inflationary conditions in domestic and global markets, we have experienced, and may continue to experience, a significant increase in various costs, including recycled fiber, energy, freight, chemical, and other supply chain costs, which has adversely affected, and may continue to adversely affect, our operations.”

Annual report 2025A · The company itself

“Our operations have been adversely affected and could continue to be adversely affected in the future, by these challenging macroeconomic and geopolitical conditions, including as the result of lower demand for certain products, and higher raw material and labor costs.”

Annual report 2025A · The company itself

“Raw materials essential to our businesses include wood fiber, mainly purchased in the form of pulpwood, wood chips and old corrugated containers ("OCC"), and certain chemicals, including caustic soda, starch and adhesives.”

Annual report 2025A · The company itself

“The market price of virgin wood fiber varies based on availability, demand, quality, and source.”

Annual report 2025A · The company itself

“Raw materials essential to our businesses include wood fiber, mainly purchased in the form of pulpwood, wood chips and old corrugated containers ("OCC"), and certain chemicals, including caustic soda, starch and adhesives.”

Annual report 2025A · The company itself

“We have significant exposure to energy costs, in particular gas, electricity and other fuel costs. Energy prices have fluctuated dramatically in the past and may continue to increase and/or fluctuate in the future.”

Annual report 2025A · The company itself

“Volatility or uncertainty in the financial, capital and credit markets, and negative developments associated with interest rates, asset values, currency exchange rates and the availability of credit, could also have a material adverse effect on our business, financial condition and results of operations and could adversely affect our liquidity, access to capital markets and ability to pay a dividend.”

Annual report 2025A · The company itself

“These risks, which can vary substantially by country, may include economic or political instability, geopolitical events, corruption, anti-American sentiment, expropriation measures, social and ethnic unrest, natural disasters, military conflicts and terrorism, the regulatory environment (including the risks of operating in developing or emerging markets in which there are significant uncertainties regarding the interpretation and enforceability of legal requirements and the enforceability of contractual rights and intellectual property rights), adverse currency fluctuations, foreign exchange control regimes (including restrictions on currency conversion), downturns or changes in economic conditions (including in relation to commodity inflation), adverse tax consequences or rulings, import restrictions, controls or other trade protection measures, economic sanctions, health guidelines and safety protocols, nationalization, changes in social, political or labor conditions, and adverse developments regarding sustainability, environmental regulations and trade policies and agreements, any of which risks could negatively affect our financial results.”

Annual report 2025A · The company itself

“Adverse movements in foreign exchange rates relating to foreign currency denominated commodities, assets and liabilities, and transactions could have a material impact on our business, financial condition, results of operations and/or future prospects.”

Annual report 2025A · The company itself

“Further, changes in customer or consumer preferences may increase or decrease the demand for fiber-based products and non-fiber substitutes. Customer and consumer preferences change based on, among other factors, cost, convenience, health concerns and perceptions and an increased awareness of sustainability considerations. In some areas, customers have increasingly shown interest in environmentally friendly products such as fiber-based packaging.”

Annual report 2025A · The company itself

“Other possible indirect impacts include influence on competitive position due to customer and end-consumer preferences regarding low-carbon, circular products with a high recycling rate along with tax credit and funding opportunities to expand green energy production and carbon credit generation.”

Annual report 2025A · The company itself

“We are affected by developments in general business and economic conditions, which could have an adverse effect on the demand for our products, our financial condition and the results of our operations including our ability to pay a cash dividend. General economic conditions may adversely affect industrial non-durable goods production, consumer confidence and spending, and employment levels, all which impact demand for our products, or otherwise adversely affect our business.”

Annual report 2025A · The company itself

“In North America, market demand was weaker than expected throughout most of the year as economic uncertainty from tariffs, slower housing starts, weaker consumer sentiment and lower industrial production negatively impacted box demand.”

Annual report 2025A · The company itself

“For example, higher prices for transportation, energy and other inputs, as well as more protracted air permitting processes, could cause delays and higher costs to implement capital projects.”

Annual report 2025A · The company itself

“Moreover, the availability of labor and the market price for fuel may affect third-party transportation costs.”

Annual report 2025A · The company itself

“Multiple jurisdictions, including Europe, the U.S. federal government, and certain U.S. states, have already proposed or enacted laws, regulations, and other requirements governing AI. In Europe, the EU AI Act, adopted in May 2024, entered its implementation phase in 2025 and imposes extensive transparency, risk management and data governance obligations for AI systems, particularly those classified as high risk, with significant fines for noncompliance.”

Annual report 2025A · The company itself

“Other possible indirect impacts include influence on competitive position due to customer and end-consumer preferences regarding low-carbon, circular products with a high recycling rate along with tax credit and funding opportunities to expand green energy production and carbon credit generation.”

Annual report 2025A · The company itself

“•We are subject to cybersecurity and information technology risks related to breaches of security pertaining to sensitive company, customer, employee and vendor information as well as breaches in the technology used to manage operations and other business processes. •Our continued growth will depend on our ability to retain existing customers and attract new customers. •Uninsured losses or losses in excess of our insurance coverage for various risks could have an adverse financial effect on our business. •We may not be able to adequately secure and protect our intellectual property rights, which could harm our competitive advantage. •We may fail to identify or leverage digital transformation initiatives.”

Annual report 2025A · The company itself

“These investments may lead to higher operating expenses as the cost of compliance increases. Our environmental expenditures include, among other areas, those related to air and water quality, waste disposal and the cleanup of soil and groundwater, including situations where we have been identified as a potentially responsible party.”

Annual report 2025A · The company itself

“Input costs were lower, driven by lower recovered fiber and wood costs, partially offset by higher energy and chemical costs.”

Annual report 2025A · The company itself

“Transportation costs are also impacted by energy costs since a key component of transportation costs relates to the cost of oil.”

Annual report 2025A · The company itself

“In addition, legal developments, such as new governmental regulations on single-use packaging products could significantly alter the market for our products.”

Annual report 2025A · The company itself

“In North America, market demand was weaker than expected throughout most of the year as economic uncertainty from tariffs, slower housing starts, weaker consumer sentiment and lower industrial production negatively impacted box demand.”

Annual report 2025A · The company itself

“We operate under two divisions, which form the basis for the two segments we report, Packaging Solutions North America and Packaging Solutions EMEA.”

Annual report 2025A · The company itself

“In EMEA, our operations include 14 containerboard mills, 148 corrugated packaging plants and 20 recycling plants.”

Annual report 2025A · The company itself

“The Company acquired DS Smith in early 2025 for an enterprise value of approximately $9.9 billion. The acquisition expanded our geographic reach across both the North America and EMEA regions, enabling advantaged cost positions, superior customer experiences and improved supply positions.”

Annual report 2025A · The company itself

“We operate under two divisions, which form the basis for the two segments we report, Packaging Solutions North America and Packaging Solutions EMEA.”

Annual report 2025A · The company itself

“Our U.S. production capacity was approximately 11 million tons annually as of December 31, 2025.”

Annual report 2025A · The company itself

“The Company acquired DS Smith in early 2025 for an enterprise value of approximately $9.9 billion. The acquisition expanded our geographic reach across both the North America and EMEA regions, enabling advantaged cost positions, superior customer experiences and improved supply positions.”

Annual report 2025A · The company itself

“We operate under two divisions, which form the basis for the two segments we report, Packaging Solutions North America and Packaging Solutions EMEA.”

Annual report 2025A · The company itself

“Future health epidemics or pandemics could also adversely impact portions of our business to varying degrees, including as the result of change in demand for certain products, supply chain and labor disruptions, and higher costs.”

Annual report 2025A · The company itself