Sylvamo Corp (NYSE:SLVM) Q2 Earnings Miss Estimates, Shares Plunge 11.6% Pre-Market
By Mill Chart
Last update: Aug 8, 2025
Sylvamo Corp (NYSE:SLVM) reported second-quarter earnings that fell short of analyst expectations, triggering a sharp pre-market decline of approximately 11.6%. The paper manufacturer posted revenue of $794 million, missing consensus estimates of $844.6 million, while adjusted earnings per share (EPS) of $0.37 came in below the projected $0.45.
Key Financial Results vs. Estimates
- Revenue: $794M actual vs. $844.6M estimated (6% miss)
- EPS: $0.37 actual vs. $0.45 estimated (18% miss)
- Adjusted EBITDA: $82M (10% margin), down from $90M in Q1
Market Reaction
The significant pre-market drop reflects investor disappointment, particularly as the company faced headwinds including:
- A $13M unfavorable foreign exchange impact
- The heaviest planned maintenance outage quarter in over five years ($39M expense)
- Lower volumes in North America and Europe
Operational Highlights
- Regional Performance:
- Europe: Operating loss widened to $38M due to maintenance outages and weak demand (sales down 8% YoY).
- Latin America: Earnings fell to $2M from $26M in Q1, though Brazil saw 6% demand growth.
- North America: Improved to $66M operating profit on cost controls and better price/mix.
- Cash Flow: Positive operating cash flow of $64M (up from $23M in Q1), though free cash flow remained negative at -$2M.
Outlook vs. Analyst Expectations
Management expects Q3 adjusted EBITDA of $145M–$165M, citing:
- Seasonal demand recovery in North America and Latin America
- No planned maintenance outages (vs. $66M in Q2)
- Stable input costs
Analysts project Q3 revenue of $894M and full-year sales of $3.49B—Sylvamo’s guidance implies confidence in operational improvements but does not explicitly address the revenue shortfall that likely drove the negative market reaction.
Strategic Moves
- Capital Allocation: Returned $38M to shareholders via dividends and buybacks ($42M remaining in authorization).
- Investments: $145M in high-return projects at its South Carolina mill, targeting >30% IRR.
For detailed earnings estimates and historical performance, view Sylvamo’s earnings data here.
Disclaimer: This article is not investment advice. Investors should conduct their own research or consult a financial advisor before making decisions.
