Avery Dennison Reports Q2 2025 Financial Results with Increased Net Income

Avery Dennison Corporation reported its financial results for the second quarter of 2025, revealing a net income of $189.0 million, an increase from $176.8 million in the same period last year. The company’s net sales for the quarter were $2.22 billion, slightly down from $2.24 billion in the prior year. For the first half of 2025, net income rose to $355.3 million compared to $349.2 million in the first half of 2024, while net sales decreased marginally from $4.39 billion to $4.37 billion. The company attributed the decline in sales primarily to raw material deflation-related price reductions, although this was partially offset by higher volume and mix.

In terms of operational changes, Avery Dennison undertook restructuring actions that resulted in $12.9 million in charges during the first half of 2025, which included severance costs for approximately 460 positions. The company is focusing on optimizing its operational footprint as part of its strategic initiatives. Additionally, the company has been actively managing its debt, with total debt increasing to $3.55 billion as of June 28, 2025, primarily due to higher commercial paper borrowings and the revaluation of euro-denominated debt.

Geographically, the company reported mixed performance across its segments. The Materials Group saw net sales of $1.55 billion, slightly up from $1.55 billion in the previous year, while the Solutions Group's sales decreased to $670.3 million from $688.5 million. The company noted that its international operations accounted for approximately 69% of net sales, with foreign currency translation negatively impacting results, particularly in Brazil and Mexico. The average number of days sales outstanding increased to 67 days, reflecting customer destocking and timing of collections.

Looking ahead, Avery Dennison anticipates continued uncertainty related to trade policies and macroeconomic conditions, which may impact demand for its products. The company expects a favorable impact on net sales and operating income from foreign currency translation based on recent rates, alongside incremental savings from restructuring actions. However, it also foresees a potential decrease in operating income in the third quarter due to seasonal volume fluctuations. The effective tax rate is projected to remain in the mid-twenty percent range for the full year.