Financial Analysis

"ACQUISITIONS On January 31, 2025, the Company completed its acquisition of the entire issued and to be issued share capital of DS Smith, a leading provider of sustainable paper-based packaging solutions across Europe and North America. This acquisition combines two complementary businesses to create a global leader in sustainable packaging solutions with industry leading positions in two geographies, Europe and North America. The acquisition is expected to enhance the efficiency of the Company's core operations in North America with the integration of DS Smiths complementary U.S. business and strengthen the Company's capabilities to advance its strategy to be a truly global sustainable packaging solutions leader. Upon closing, IP issued 0.1285 shares for each DS Smith share, resulting in the issuance of 178,126,631 new shares of IP common stock (""New Company Common Stock""). As a result of the share issuance, the holders of the New Company Common Stock own approximately 34.1% of the Company's outstanding share capital. Based on the issuance of 178,126,631 new shares and the closing price of 55.63 on the close of January 31, 2025, the total purchase consideration for the completed acquisition was approximately $9.9 billion . Acquisition-related costs were $96 million and $86 million for the years ended December 31, 2025 and December 31, 2024 , respectively, and were recorded in Selling and administrative expenses and Taxes other than payroll and income taxes in the accompany …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

"COMMITMENTS AND CONTINGENT LIABILITIES General The Company is involved in various inquiries, administrative proceedings and litigation relating to environmental and safety matters, personal injury, product liability, labor and employment, contracts, sales of property, intellectual property, tax, and other matters, that arise in the normal course of business. These matters may raise difficult and complicated legal issues and may be subject to many uncertainties and complexities. Moreover, some of these matters allege substantial or indeterminate monetary damages. International Paper reviews inquiries, administrative proceedings and litigation, including with respect to environmental matters, on an ongoing basis and establishes an estimated liability for specific legal proceedings and other loss contingencies when it determines that the likelihood of an unfavorable outcome is probable, and the amount of the loss can be reasonably estimated. In addition, if the likelihood of an unfavorable outcome with respect to material loss contingencies is reasonably possible and International Paper is able to determine an estimate of the possible loss or range of loss, whether in excess of a related accrued liability of where there is no accrued liability, International Paper will disclose the estimate of the possible loss or range of loss. When no amount in a range of loss is more likely than any other amount in the range, the low end of the range is used as the estimate of the possible l …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

DEBT AND LINES OF CREDIT The borrowing capacity of the Company's commercial paper program is $1.0 billion supported by its $1.4 billion credit agreement. Under the terms of this program, individual maturities on borrowings may vary, but not exceed one year from the date of issue. Interest bearing notes may be issued either as fixed or floating rate notes. The Company had no borrowings outstanding as of December 31, 2025 and December 31, 2024 under this program. At December 31, 2025 , the Company's credit facilities totaled $1.9 billion , excluding the DS Smith credit facilities discussed below. The credit facilities generally provide for interest rates at a floating rate index plus a pre- determined margin dependent upon International Paper's credit rating. The credit facilities include a $1.4 billion contractually committed bank facility with a maturity date of June 2028. The liquidity facilities also include up to $500 million of uncommitted financings based on eligible receivables balances under a receivable securitization program that expires in June 2026 . As of December 31, 2025 and December 31, 2024 , the Company had no borrowings outstanding under the program. Below is a table of the foreign denominated credit facilities: In millions December 31, 2025 Credit Facilities Borrowing Currency USD Equivalent Capacity USD Equivalent Outstanding 2.834% Amortizing credit facility - due 2026-2029 EUR $ 191 $ 191 Floating rate instruments: Committed bank facility maturing May 20 …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

2025 Reportable Segments Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 14,431 $ $ 8 $ 14,439 EMEA 8,451 8,451 Pacific Rim and Asia 31 31 Americas, other than U.S. 713 713 Total $ 15,175 $ 8,451 $ 8 $ 23,634 (a) Net sales are attributed to countries based on the location of the reportable segment making the sale. 2024 Reportable Segments Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 13,500 $ $ 186 $ 13,686 EMEA 1,355 1,355 Pacific Rim and Asia 63 1 64 Americas, other than U.S. 730 730 Total $ 14,293 $ 1,355 $ 187 $ 15,835 (a) Net sales are attributed to countries based on the location of the reportable segment making the sale. 2023 Reportable Segments Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 13,435 $ $ 342 $ 13,777 EMEA 1,398 1,398 Pacific Rim and Asia 37 37 Americas, other than U.S. 821 821 Total $ 14,293 $ 1,398 $ 342 $ 16,033 (a) Net sales are attributed to countries based on the location of the reportable segment making the sale . …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

"INCENTIVE PLANS On February 13, 2024, the Company's Board of Directors, upon recommendation of the Management Development and Compensation Committee (the ""MDCC""), authorized adoption of a 2024 Long-Term Incentive Compensation Plan (the ""2024 LTICP"") to replace the 2009 Amended and Restated Incentive Compensation Plan (the ""2009 Plan""). The 2024 LTICP became effective following approval by shareholders at the May 13, 2024 annual meeting and replaced the 2009 Plan. The 2024 LTICP authorized up to 9,250,000 shares of our Class A common stock, par value $1.00 per share, available for future grants in the form of restricted stock, restricted or deferred stock units, performance awards payable in cash or stock upon the attainment of specified performance goals, dividend equivalents, options, stock appreciation rights, other stock-based awards and cash-based awards at the discretion of the Committee. Shares for which payment is in cash, including the shares withheld to cover associate payroll taxes, as well as shares that expire, terminate, or are canceled or forfeited, may be awarded or granted again under the LTICP. The LTICP is administered by the Committee. Additionally, non-employee members of our Board of Directors receive grants of restricted stock for RSUs, under the Company's Restricted Stock and Deferred Compensation Plan for Non-Employee Directors, a subplan of the 2024 LTICP. Performance Stock Units PSU awards are earned over a three-year period based on the achie …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

GOODWILL AND OTHER INTANGIBLES GOODWILL The following table presents changes in the goodwill balances as allocated to each reportable business segment for the years ended December 31, 2025 and 2024 : In millions Packaging Solutions North America Packaging Solutions EMEA Total Balance as of December 31, 2023 Goodwill $ 3,337 $ 76 $ 3,413 Accumulated impairment losses (296) (76) (372) 3,041 3,041 Currency translation (3) (3) Balance as of December 31, 2024 Goodwill 3,334 76 3,410 Accumulated impairment losses (296) (76) (372) 3,038 3,038 Goodwill additions (a) 873 3,462 4,335 Goodwill reductions (b) (2,467) (2,467) Currency translation (2) 422 420 Balance as of December 31, 2025 Goodwill 3,968 3,960 7,928 Accumulated impairment losses (59) (2,543) (2,602) Total $ 3,909 $ 1,417 $ 5,326 (a) Reflects the acquisition of DS Smith. See Note 7 - Acquisitions for further details. (b) Reflects PS EMEA Impairment losses and PS NA write-offs of previously impaired goodwill of $237 million and accumulated impairment losses of $(237) million . The Company completed its annual goodwill impairment testing for the Packaging Solutions North America (PS NA) and Packaging Solutions EMEA (PS EMEA) reporting units as of October 1, 2025. Based on this assessment, no impairment was identified for either reporting unit. During the fourth quarter of 2025, the Company identified a triggering event as part of its annual strategic review, driven by updated macroeconomic and industry outlooks, as well as t …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

INCOME TAXES The components of I nternational Papers earnings from continuing operations before income taxes and equity earnings by taxing jurisdiction were as follows: In millions 2025 2024 2023 Earnings (loss) U.S. $ (224) $ 127 $ 203 Non-U.S. (3,144) 242 199 Earnings (loss) from continuing operations before income taxes and equity earnings (losses) $ (3,368) $ 369 $ 402 T he provision (benefit) for income taxes from continuing operations (excluding noncontrolling interests) by taxing jurisdiction was as follows: In millions 2025 2024 2023 Current tax provision (benefit) U.S. federal $ (13) $ (71) $ 132 U.S. state and local 3 26 10 Non-U.S. 92 42 36 $ 82 $ (3) $ 178 Deferred tax provision (benefit) U.S. federal $ (352) $ (252) $ (125) U.S. state and local (65) (92) 12 Non-U.S. (198) (14) 3 $ (615) $ (358) $ (110) Income tax provision (benefit) $ (533) $ (361) $ 68 The Companys deferred income tax provision (benefit) includes a $(1) million benefit, a $1 million expense and a $(6) million benefit for 2025 , 2024 and 2023 , respectively, for the effect of various changes in non-U.S. and U.S. state tax rates. In 2025, International Paper made income tax payments (net of refunds) of $161 million , consisting of $39 million of U.S. Federal tax payments, $13 million of U.S. state and local income tax payments and $109 million of non-U.S. tax payments. Of these amounts, income taxes paid (net of refunds) exceeded 5 percent of total income taxes paid (net of refunds) in the followi …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

LEASES International Paper leases various real estate, including certain operating facilities, warehouses, office space and land. The Company also leases material handling equipment, vehicles, and certain other equipment. The Company's leases have remaining lease terms of up to 28 years . COMPONENTS OF LEASE EXPENSE In millions 2025 2024 2023 Operating lease costs, net $ 258 $ 172 $ 168 Variable lease costs 50 51 37 Short-term lease costs, net 112 61 56 Finance lease cost Amortization of lease assets 15 9 9 Interest on lease liabilities 3 2 2 Total lease cost, net $ 438 $ 295 $ 272 SUPPLEMENTAL BALANCE SHEET INFORMATION RELATED TO LEASES In millions Classification 2025 2024 Assets Operating lease assets Right of use assets $ 697 $ 402 Finance lease assets Plants, properties and equipment, net (a) 70 31 Total leased assets $ 767 $ 433 Liabilities Current Operating Other current liabilities $ 221 $ 144 Finance Notes payable and current maturities of long-term debt 17 9 Noncurrent Operating Long-term lease obligations 486 269 Finance Long-term debt 54 31 Total lease liabilities $ 778 $ 453 (a) Finance leases are recorded net of accumulated amortization of $69 million and $59 million at December 31, 2025 and 2024 , respectively. LEASE TERM AND DISCOUNT RATE In millions 2025 2024 Weighted average remaining lease term (years) Operating leases 4.8 3.6 Finance leases 6.0 7.2 Weighted average discount rate Operating leases 4.23 % 4.34 % Finance leases 4.19 % 4.93 % SUPPLEMENTAL CASH F …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

"RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS Income Taxes In December 2023, the FASB issued ASU 2023-09, ""Income Taxes (Topic 740): Improvements to Income Tax Disclosures."" This guidance requires companies to enhance income tax disclosures, particularly around rate reconciliations and income taxes paid information. This guidance is effective for annual reporting periods beginning after December 15, 2024. The Company adopted this guidance on a prospective basis effective January 1, 2025 - see Note 13 - Income Taxes for impacts to the related disclosures. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED Government Grants In December 2025, the FASB issued ASU 2025-10, ""Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities."" This guidance establishes accounting for government grants received by a business including guidance for grants related to assets and grants related to income. This guidance is effective for annual reporting periods beginning after December 15, 2028 and interim periods within that fiscal year. Early adoption is permitted. The Company is currently evaluating the provisions of this guidance. Derivatives and Hedging In November 2025, the FASB issued ASU 2025-09, ""Derivatives and Hedging (Topic 815): Hedge Accounting Improvements."" This guidance includes changes to more closely align hedge accounting with the economics of an entity's risk management activities. This guidance is effective for annual reporting p …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

"RETIREMENT AND POSTRETIREMENT PLANS International Paper sponsors and maintains the Retirement Plan of International Paper Company (the ""Pension Plan""), a tax-qualified defined benefit pension plan that provides retirement benefits to certain employees. The Pension Plan provides defined pension benefits based on years of credited service and either final average earnings (salaried employees and hourly employees receiving salaried benefits), hourly job rates or specified benefit rates (hourly and union employees). In connection with our acquisition, International Paper acquired the existing DS Smith Group Pension Scheme (the ""Group Scheme""), a U.K. funded defined benefit plan providing pension benefits and lump sum benefits to members and dependents. The Group Scheme closed to new entrants and future accruals as of April 30, 2011. International Paper also acquired various non-U.S. retirement benefit arrangements as part of the acquisition, some of which are considered to be defined benefit pension plans for accounting purposes. The Company also has two unfunded nonqualified defined benefit pension plans: the Pension Restoration Plan that provides retirement benefits based on eligible compensation in excess of limits set by the Internal Revenue Service, and the Unfunded Supplemental Retirement Plan for Senior Managers (""SERP""), which is an alternative retirement plan for salaried employees who are senior vice presidents and above or who are designated by the chief executi …

PensionAndOtherPostretirementBenefitsDisclosureTextBlock · excerpt; the full note is in the filing

RESTRUCTURING CHARGES, NET 2025 : During 2025 , restructuring and other charges, net, totaling $626 million before taxes were recorded. The charges included: In millions 2025 Red River mill closure costs (a) $ 84 Savannah mill closure costs (b) 125 Riceboro mill closure costs (c) 96 Resource and asset realignment - PS EMEA (d) 262 Resource realignment - PS NA (e) 59 Total $ 626 (a) Includes severance charges of $18 million , the majority of which have been paid, inventory charges of $26 million and other charges of $40 million for the year ended December 31, 2025 . Inventory charges of $19 million are recorded in Inventories, severance charges of $5 million are recorded in Accrued payroll and benefits and other costs of $32 million are recorded in Other current liabilities and Other Liabilities in the accompanying consolidated balance sheet as of December 31, 2025 . (b) Includes severance charges of $30 million , inventory charges of $38 million and other charges of $57 million for the year ended December 31, 2025 . Severance charges of $12 million are recorded in Accrued payroll and benefits, $33 million of inventory charges are recorded in Inventories and other costs of $56 million are recorded in Other current liabilities and Other Liabilities in the accompanying consolidated balance sheet as of December 31, 2025 . The remaining severance charges will be paid in 2026. (c) Includes severance charges of $12 million , the majority of which have been paid, inventory charges of …

RestructuringAndRelatedActivitiesDisclosureTextBlock · excerpt; the full note is in the filing

REVENUE RECOGNITION DISAGGREGATED REVENUE 2025 Reportable Segments Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 14,431 $ $ 8 $ 14,439 EMEA 8,451 8,451 Pacific Rim and Asia 31 31 Americas, other than U.S. 713 713 Total $ 15,175 $ 8,451 $ 8 $ 23,634 (a) Net sales are attributed to countries based on the location of the reportable segment making the sale. 2024 Reportable Segments Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 13,500 $ $ 186 $ 13,686 EMEA 1,355 1,355 Pacific Rim and Asia 63 1 64 Americas, other than U.S. 730 730 Total $ 14,293 $ 1,355 $ 187 $ 15,835 (a) Net sales are attributed to countries based on the location of the reportable segment making the sale. 2023 Reportable Segments Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 13,435 $ $ 342 $ 13,777 EMEA 1,398 1,398 Pacific Rim and Asia 37 37 Americas, other than U.S. 821 821 Total $ 14,293 $ 1,398 $ 342 $ 16,033 (a) Net sales are attributed to countries based on the location of the reportable segment making the sale . REVENUE CONTRACT BALANCES A contract asset is created when the Company recognizes revenue on its customized products prior to having an unconditional right to payment from the customer, which generally does not occ …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

FINANCIAL INFORMATION BY BUSINESS SEGMENT AND GEOGRAPHIC AREA On January 23, 2026, the Company completed the previously announced sale of its Global Cellulose Fibers business to AIP. As a result of the sale, the Global Cellulose Fibers business is no longer a reportable segment and all current and historical operating results of the Global Cellulose Fibers business are presented as Discontinued Operations, net of taxes, in the consolidated statements of operations. All current and historical assets and liabilities of the Global Cellulose Fibers business are classified as Assets held for sale and Long-Term Assets Held For Sale and Liabilities held for sale and Long-Term Liabilities Held For Sale in the accompanying consolidated balance sheets. See Note 8 - Divestiture for further details regarding the Global Cellulose Fibers business and discontinued operations. As a result of the acquisition of DS Smith, the Chief Operating Decision Maker (CODM) began reviewing and managing the Companys financial results and operations under a revised structure that reflects the scope of the Companys continuing operations: Packaging Solutions North America (PS NA) and Packaging Solutions EMEA (PS EMEA). The PS EMEA segment includes the Company's legacy EMEA Industrial Packaging business and the EMEA DS Smith business. As such, amounts related to the Company's legacy EMEA Industrial Packaging business have been recast out of the Industrial Packaging segment into the new PS EMEA segment for all …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

CAPITAL STOCK The authorized capit al stock at both December 31, 2025 and 2024 , consisted of 990,850,000 shares of common stock, $1 par value; 400,000 shares of cumulative $4 preferred stock, without par value (stated value $100 per share); and 8,750,000 shares of serial preferred stock, $1 par value. The serial preferred stock is issuable in one or more series by the Board of Directors without further shareholder action. The following is a roll forward of shares of common stock for the three years ended December 31, 2025 , 2024 and 2023 : Common Stock In thousands Issued Treasury Balance at January 1, 2023 448,916 98,632 Issuance of stock for various plans, net (1,647) Repurchase of stock 5,894 Balance at December 31, 2023 448,916 102,879 Issuance of stock for various plans, net (2,028) Repurchase of stock 648 Balance at December 31, 2024 448,916 101,499 Issuance of stock for various plans, net (3,678) Issuance of stock for DS Smith acquisition 178,127 Repurchase of stock 1,170 Balance at December 31, 2025 627,043 98,991 …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing

SUBSEQUENT EVENTS On January 29, 2026, the Company announced a plan to create two independent, publicly traded companies through the separation of its PS NA and PS EMEA businesses. The PS NA business will be comprised of the Company's current business in North America, including both legacy IP and DS Smith assets, and the PS EMEA business will be comprised of both legacy DS Smith and IP assets in EMEA. The separation is expected to be structured as a spin-off of the PS EMEA businesses to shareholders and is expected to be completed in 12 - 15 months , subject to the satisfaction of certain customary conditions. No assurance can be provided regarding the ultimate timing or structure of the proposed separation or its eventual completion.

SubsequentEventsTextBlock

"ACQUISITIONS As previously disclosed, on January 31, 2025, the Company completed its acquisition of the entire issued and to be issued share capital of DS Smith. Upon closing, IP issued 0.1285 shares for each DS Smith share, resulting in the issuance of 178,126,631 new shares of IP common stock (""New Company Common Stock""). As a result of the share issuance, the holders of the New Company Common Stock own approximately 34.1% of the Company's outstanding share capital. Based on the issuance of 178,126,631 new shares and the closing price of $55.63 on the close of January 31, 2025, the total purchase consideration for the completed acquisition was approximately $9.9 billion. Acquisition-related costs were $4 million and $94 million for the three months and nine months ended September 30, 2025, respectively, and $26 million and $48 million for the three months and nine months ended September 30, 2024, respectively, and were recorded in Selling and administrative expenses and Taxes other than payroll and income taxes in the accompanying condensed consolidated statement of operations. On February 4, 2025, the Company began trading the New Company Common Stock and continues to be listed on the New York Stock Exchange under the trading symbol ""IP"" and via a secondary listing on the London Stock Exchange under the trading symbol ""IPC."" The headquarters of the combined company is based in Memphis, Tennessee, and the EMEA headquarters has been established at DS Smith's existing …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

"COMMITMENTS AND CONTINGENCIES General The Company is involved in various inquiries, administrative proceedings and litigation relating to environmental and safety matters, personal injury, product liability, labor and employment, contracts, sales of property, intellectual property, tax, and other matters, that arise in the normal course of business. These matters may raise difficult and complicated legal issues and may be subject to many uncertainties and complexities. Moreover, some of these matters allege substantial or indeterminate monetary damages. International Paper reviews inquiries, administrative proceedings and litigation, including with respect to environmental matters, on an ongoing basis and establishes an estimated liability for specific legal proceedings and other loss contingencies when it determines that the likelihood of an unfavorable outcome is probable, and the amount of the loss can be reasonably estimated. In addition, if the likelihood of an unfavorable outcome with respect to material loss contingencies is reasonably possible and International Paper is able to determine an estimate of the possible loss or range of loss, whether in excess of a related accrued liability of where there is no accrued liability, International Paper will disclose the estimate of the possible loss or range of loss. When no amount in a range of loss is more likely than any other amount in the range, the low end of the range is used as the estimate of the possible loss. Inte …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

"DEBT The borrowing capacity of the Company's commercial paper program is $1.0 billion supported by its $1.4 billion credit agreement. Under the terms of the program, individual maturities on borrowings may vary, but not exceed one year from the date of issue. Interest bearing notes may be issued either as fixed or floating rate notes. There were no borrowings outstanding as of September 30, 2025 under the program. At September 30, 2025, International Papers USD denominated credit facilities totaled $1.9 billion, excluding the DS Smith credit facilities discussed below. The credit facilities generally provide for interest rates at a floating rate index plus a pre-determined margin dependent upon International Papers credit rating. The credit facilities included a $1.4 billion contractually committed bank facility with a maturity date of June 2028. The liquidity facilities also include up to $500 million of uncommitted financings based on eligible receivables balances under a receivables securitization program that expires in June 2026. At September 30, 2025, the Company had no borrowings outstanding under the receivables securitization program. Following the DS Smith acquisition, International Paper assumed foreign denominated debt of DS Smith in various currencies with an approximated value of $3.6 billion. In March 2025, the Company amended and restated DS Smith's credit facility agreements and entered into agreements to guarantee the outstanding notes of DS Smith. Below is …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

Three Months Ended September 30, 2025 In millions Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 3,738 $ $ 15 $ 3,753 Europe, Middle East and Africa 2,310 (1) 2,309 Pacific Rim and Asia 5 5 Americas, other than U.S. 155 155 Total $ 3,898 $ 2,310 $ 14 $ 6,222 (a) Net sales are attributed to countries based on the location of the seller. Three Months Ended September 30, 2024 In millions Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 3,464 $ $ 17 $ 3,481 Europe, Middle East and Africa 322 322 Pacific Rim and Asia 17 17 Americas, other than U.S. 159 159 Total $ 3,640 $ 322 $ 17 $ 3,979 (a) Net sales are attributed to countries based on the location of the seller. Nine Months Ended September 30, 2025 In millions Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 10,900 $ $ 18 $ 10,918 Europe, Middle East and Africa 6,151 (1) 6,150 Pacific Rim and Asia 25 25 Americas, other than U.S. 535 535 Total $ 11,460 $ 6,151 $ 17 $ 17,628 (a) Net sales are attributed to countries based on the location of the seller. Nine Months Ended September 30, 2024 In millions Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 10,153 $ …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

"STOCK-BASED COMPENSATION International Paper's 2024 Long-Term Incentive Compensation Plan (the ""2024 LTICP') authorizes grants of restricted stock, restricted or deferred stock units, performance awards payable in cash or stock upon the attainment of specified performance goals, dividend equivalents, options, stock appreciation rights, other stock-based awards and cash-based awards at the discretion of the Management Development and Compensation Committee of the Board of Directors (the MDCC). Effective January 1, 2025, performance stock unit awards granted pursuant to the 2024 LTICP use 100% relative total shareholder return (""TSR"") as the sole performance metric. As of September 30, 2025, 7.0 million shares were available for grant under the LTICP. Subsequent to the acquisition of DS Smith, the Company agreed to provide equity transition awards to DS Smith employees who became employees of the Company after closing of the transaction. The transition awards, which were granted in March 2025, consisted of time-based restricted stock units. The transition awards replaced the unvested portion of the 2024 DS Smith Performance Share Plan award granted to DS Smith employees in July 2024. Stock-based compensation expense and related income tax benefits were as follows: Three Months Ended September 30, Nine Months Ended September 30, In millions 2025 2024 2025 2024 Total stock-based compensation expense (selling and administrative) $ 18 $ 23 $ 72 $ 55 Income tax benefits related …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

GOODWILL AND OTHER INTANGIBLES Goodwill The following table presents changes in goodwill balances as allocated to each business segment for the nine months ended September 30, 2025: In millions Packaging Solutions North America Packaging Solutions EMEA Total Balance as of January 1, 2025 Goodwill $ 3,334 $ 76 $ 3,410 Accumulated impairment losses (296) (76) (372) Total 3,038 3,038 Goodwill additions/reductions (a) 867 (c) 3,362 (c) 4,229 Currency translation and other (b) 1 407 408 Balance as of September 30, 2025 Goodwill 3,965 3,845 7,810 Accumulated impairment losses (59) (76) (135) Total $ 3,906 $ 3,769 $ 7,675 (a) Includes write-offs of previously impaired goodwill of $237 million and accumulated impairment losses of $(237) million. (b) Represents the effects of foreign currency translations and reclassifications. (c) Reflects the acquisition of DS Smith. See Note 8 - Acquisitions for further details. Other Intangibles Identifiable intangible assets comprised of the following: September 30, 2025 December 31, 2024 In millions Gross Carrying Amount Accumulated Amortization Net Intangible Assets Gross Carrying Amount Accumulated Amortization Net Intangible Assets Customer relationships and lists $ 4,131 $ 481 $ 3,650 $ 394 $ 329 $ 65 Tradenames, patents and trademarks, and developed technology 471 74 397 57 57 Software 126 22 104 (a) 12 12 Land and water rights 8 2 6 8 2 6 Other 20 5 15 3 2 1 Total $ 4,756 $ 584 $ 4,172 $ 474 $ 402 $ 72 (a) Of this balance, $64 million has …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

"INCOME TAXES International Paper made income tax payments, net of refunds, of $134 million and $285 million for the nine months ended September 30, 2025 and 2024, respectively. The Company currently estimates that, as a result of ongoing discussions, pending tax settlements and expirations of statutes of limitations, the amount of unrecognized tax benefits could be reduced by approximately $7 million during the next 12 months. During the second quarter of 2024, the Company completed an internal legal entity restructuring for which a capital loss was recognized for U.S. federal and state income tax purposes. The Company intends to use this capital loss to offset capital gains, and, as such, recorded a deferred tax asset and a deferred tax benefit of approximately $338 million in the second quarter of 2024, which impacted the effective income tax rate for the three months and six months ended June 30, 2024. During the third quarter of 2024, an adjustment to the capital loss amount resulted in an additional deferred tax asset and deferred tax benefit recorded of $78 million. The Organization for Economic Cooperation and Development has proposed a 15% global minimum tax applied on a country-by-country basis (the ""Pillar Two rule""), and many countries, including countries in which we operate, have enacted or begun the process of enacting laws adopting the Pillar Two rule. The first component of the Pillar Two rule became effective as of January 1, 2024, and did not have a mater …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

LEASES International Paper leases various real estate, including certain operating facilities, warehouses, office space and land. The Company also leases material handling equipment, vehicles, and certain other equipment. The Company's leases have a remaining lease term of up to 28 years. Total lease costs were $122 million and $74 million for the three months ended September 30, 2025 and 2024, respectively, and $333 million and $217 million for the nine months ended September 30, 2025 and 2024, respectively. Supplemental Balance Sheet Information Related to Leases In millions Classification September 30, 2025 December 31, 2024 Assets Operating lease assets Right-of-use assets $ 679 $ 402 Finance lease assets Plants, properties and equipment, net (a) 69 31 Total leased assets $ 748 $ 433 Liabilities Current Operating Other current liabilities $ 234 $ 144 Finance Notes payable and current maturities of long-term debt 16 9 Noncurrent Operating Long-term lease obligations 450 269 Finance Long-term debt 68 31 Total lease liabilities $ 768 $ 453 (a) Finance leases are recorded net of accumulated amortization of $72 million and $59 million as of September 30, 2025 and December 31, 2024, respectively. Maturity of Lease Liabilities In millions Operating Leases Financing Leases Total 2025 (three months) $ 72 $ 11 $ 83 2026 230 28 258 2027 171 16 187 2028 111 13 124 2029 62 9 71 Thereafter 112 15 127 Total lease payments 758 92 850 Less imputed interest 74 8 82 Present value of lease l …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

"Recently Adopted Accounting Pronouncements Income Taxes In December 2023, the FASB issued ASU 2023-09, ""Income Taxes (Topic 740): Improvements to Income Tax Disclosures."" This guidance requires companies to enhance income tax disclosures, particularly around rate reconciliations and income taxes paid information. This guidance is effective for annual reporting periods beginning after December 15, 2024. Early adoption of these amendments is permitted and amendments should be applied prospectively. The Company adopted this guidance as of January 1, 2025 and will update disclosures within the Company's 2025 annual filing. Recently Issued Accounting Pronouncements Not Yet Adopted Intangible Assets In September 2025, the FASB issued ASU 2025-06, ""Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software."" This guidance provides criteria that must be met for entities to capitalize software development costs and factors to consider if there is significant uncertainty associated with the development activities of the software. This guidance is effective for annual reporting periods beginning after December 15, 2027 and interim periods within that fiscal year. Early adoption is permitted. The Company is currently evaluating the provisions of this guidance. Disaggregation of Income Statement Expenses In November 2024, the FASB issued ASU 2024-03, ""Income Statement - Reporting Comprehensive Income …

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"RETIREMENT PLANS International Paper operates both defined benefit and defined contribution pension plans as well as other post retirement benefit plans throughout our operations in accordance with local conditions and practice. We sponsor and maintain the Retirement Plan of International Paper Company (the ""Pension Plan""), a tax-qualified defined benefit pension plan that provides retirement benefits to substantially all hourly and union employees who work at a participating business unit. The Pension Plan was frozen as of January 1, 2019 for salaried participants. The Pension Plan provides defined pension benefits based on years of credited service and either final average earnings (salaried employees and hourly employees receiving salaried benefits), hourly job rates or specified benefit rates (hourly and union employees). In connection with our acquisition, International Paper acquired the existing DS Smith Group Pension plan (the ""Group Plan""), a UK funded defined benefit plan providing pension benefits and lump sum benefits to members and dependents. The Group Plan closed to new entrants and future accruals as of April 30, 2011. Net periodic pension expense (income) for our qualified and nonqualified defined benefit plans and the Group Plan, is comprised of the following: Three Months Ended September 30, Nine Months Ended September 30, In millions 2025 2024 2025 2024 Service cost $ 11 $ 12 $ 32 $ 39 Interest cost 127 112 377 335 Expected return on plan assets (157) …

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RESTRUCTURING CHARGES, NET 2025: During the three months and nine months ended September 30, 2025, the Company recorded restructuring charges of $342 million and $464 million, respectively. These charges included: In millions Three Months Ended September 30, 2025 Nine Months Ended September 30, 2025 Red River mill closure costs (a) $ $ 85 Savannah mill closure costs (b) 135 135 Riceboro mill closure costs (c) 95 95 Resource realignment - PS EMEA (d) 67 97 Resource realignment - PS NA (e) 45 52 $ 342 $ 464 (a) Includes severance charges of $18 million, the majority of which have been paid, inventory charges of $26 million and other charges of $41 million for the nine months ended September 30, 2025. Inventory charges of $25 million are recorded in Inventories, severance charges of $7 million are recorded in Accrued payroll and benefits and other costs of $36 million are recorded in Other current liabilities and Other Liabilities in the accompanying condensed consolidated balance sheet as of September 30, 2025. (b) Includes severance charges of $31 million recorded in Accrued payroll and benefits, $38 million of inventory charges recorded in Inventories and other costs of $66 million recorded in Other current liabilities and Other Liabilities in the accompanying condensed consolidated balance sheet as of September 30, 2025. The majority of the severance charges will be paid in 2025. (c) Includes severance charges of $12 million recorded in Accrued payroll and benefits, inventor …

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REVENUE RECOGNITION Generally, the Company recognizes revenue on a point-in-time basis when the Company transfers control of the goods to the customer. For customized goods where the Company has a legally enforceable right to payment for the goods, the Company recognizes revenue over time which, generally, is as the goods are produced. Disaggregated Revenue Three Months Ended September 30, 2025 In millions Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 3,738 $ $ 15 $ 3,753 Europe, Middle East and Africa 2,310 (1) 2,309 Pacific Rim and Asia 5 5 Americas, other than U.S. 155 155 Total $ 3,898 $ 2,310 $ 14 $ 6,222 (a) Net sales are attributed to countries based on the location of the seller. Three Months Ended September 30, 2024 In millions Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 3,464 $ $ 17 $ 3,481 Europe, Middle East and Africa 322 322 Pacific Rim and Asia 17 17 Americas, other than U.S. 159 159 Total $ 3,640 $ 322 $ 17 $ 3,979 (a) Net sales are attributed to countries based on the location of the seller. Nine Months Ended September 30, 2025 In millions Packaging Solutions North America Packaging Solutions EMEA Corporate & Intersegment Total Primary Geographical Markets (a) United States $ 10,900 $ $ 18 $ 10,918 Europe, Middle East and Africa 6,151 (1) 6,150 Pacific Rim and As …

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BUSINESS SEGMENT INFORMATION The Company announced on August 21, 2025 that it had reached a definitive agreement with AIP to sell its Global Cellulose Fibers business. As a result of the announcement, the Global Cellulose Fibers business is no longer a reportable segment and all current and historical operating results of the Global Cellulose Fibers business are presented as Discontinued Operations, net of tax, in the condensed consolidated statement of operations. All current and historical assets and liabilities of the Global Cellulose Fibers business are classified as Assets held for sale and Long-Term Assets Held For Sale and Liabilities held for sale and Long-Term Liabilities Held For Sale in the accompanying condensed balance sheets. See Note 9 - Divestiture for further details regarding the Global Cellulose Fibers business and discontinued operations. As a result of the acquisition of DS Smith, the Chief Operating Decision Maker (CODM) began reviewing and managing the Companys financial results and operations under a revised structure that reflects the scope of the Companys continuing operations: Packaging Solutions North America (PS NA) and Packaging Solutions EMEA (PS EMEA). The PS EMEA segment includes the Company's legacy EMEA Industrial Packaging business and the EMEA DS Smith business. As such, amounts related to the Company's legacy EMEA Industrial Packaging business have been recast out of the Industrial Packaging segment into the new PS EMEA segment for all pr …

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EQUITY A summary of the changes in equity for the three months and nine months ended September 30, 2025 and 2024 is provided below: Three Months Ended September 30, 2025 In millions, except per share amounts Common Stock Issued Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Common Stock Held In Treasury, At Cost Total Equity Balance, July 1 $ 627 $ 14,374 $ 8,865 $ (672) $ 4,577 $ 18,617 Issuance of stock for various plans, net 19 (4) 23 Repurchase of stock 1 (1) Common stock dividends ($0.4625 per share) (246) (246) Comprehensive income (loss) (1,102) 26 (1,076) Ending Balance, September 30 $ 627 $ 14,393 $ 7,517 $ (646) $ 4,574 $ 17,317 Nine Months Ended September 30, 2025 In millions, except per share amounts Common Stock Issued Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Common Stock Held In Treasury, At Cost Total Equity Balance, January 1 $ 449 $ 4,732 $ 9,393 $ (1,722) $ 4,679 $ 8,173 Issuance of stock for various plans, net (70) (169) 99 Issuance of stock for DS Smith acquisition 178 9,731 9,909 Repurchase of stock 64 (64) Common stock dividends ($1.3875 per share) (744) (744) Comprehensive income (loss) (1,132) 1,076 (56) Ending Balance, September 30 $ 627 $ 14,393 $ 7,517 $ (646) $ 4,574 $ 17,317 Three Months Ended September 30, 2024 In millions, except per share amounts Common Stock Issued Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Common Stock Held In Treasury …

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