Ranpak (NYSE:PACK) closed out 2025 with volume growth across all geographies and what management described as accelerating momentum in its automation business, even as Europe remained challenging and profitability was pressured by mix and non-cash warrant impacts.
Fourth-quarter trends: e-commerce strength in North America, mixed results in Europe
Chairman and CEO Omar Asali said Ranpak “finished 2025 on a positive note” as all regions posted sequential volume improvement, including Europe showing volume growth “for the first time this year.” Management highlighted a “very robust e-commerce-led holiday season” in North America, particularly in December, following a brief lull tied to a government shutdown. North America volumes grew 5.5% in the quarter and 14.3% for the year, according to Asali.
CFO Bill Drew provided additional color on regional performance. In North America, net revenue increased 5.8% in the quarter and 14% for the year as the company continued to scale with large e-commerce customers and ramp automation. In Europe and Asia Pacific, combined revenue fell about 1.4% year-over-year on a constant-currency basis in the quarter, as higher protective packaging volumes and automation growth were offset by “higher rebate activity due to the competitive environment in Europe” and pricing investment ahead of local paper sourcing in Asia. For the full year, revenue in Europe and APAC declined 2.7% on a constant-currency basis, which Drew attributed to lower volumes and a higher impact of rebates.
Automation momentum builds, with profitability inflection targeted in 2026
Management repeatedly pointed to automation as a key growth driver. Asali said automation grew nearly 40% on a constant-currency basis in the quarter (excluding warrant impacts) and exited the year with a strong order book, which he said provided visibility into what the company believes could be its “largest growth year yet” for that business.
Drew said automation was roughly $40 million in sales during 2025 and remained a “meaningful drag” on profitability, contributing negative $6 million to Adjusted EBITDA for the year. However, he noted automation reached break-even on an Adjusted EBITDA basis in the fourth quarter and said the company expects substantial growth in 2026 that would put automation into positive territory for the year—described as a “critical milestone.”
In response to analyst questions, Asali said Ranpak entered 2026 with its “best backlog ever” in automation and cited activity in both the U.S. and Europe, as well as supportive factors such as labor dynamics and U.S. tax changes that can improve customers’ returns on automation investments.
Margins and EBITDA: warrant impacts and mix pressure weighed on results
Asali said Ranpak reached the lower end of its Adjusted EBITDA guidance for 2025 but “miss[ed] the top line slightly” due to continued challenges in Europe and automation project milestones shifting into the first quarter of 2026. He also described 2025 as “a more difficult year than we anticipated,” citing a rapidly evolving tariff environment that drove some customers—particularly in Europe—to take a more cautious stance.
Drew said gross profit declined 16% on a constant-currency basis in the quarter, and would have declined 10.6% excluding a $2.3 million non-cash warrant impact. He attributed underlying pressure largely to mix, including increased contribution from North America large e-commerce customers and lower industrial activity. For the full year, gross profit declined 9% on a constant-currency basis and would have declined 5.3% excluding the non-cash warrant impact.
Adjusted EBITDA declined 10.3% on a constant-currency basis in the fourth quarter, though Asali noted that excluding warrant impacts the decline was 1.2%. For the full year, Adjusted EBITDA was down 8.5% on a constant-currency basis, or down 2.4% excluding warrants. Drew said SG&A (excluding RSU expense) was down 2% year-over-year on a constant-currency basis, and management emphasized cost discipline and the opportunity to improve gross margins in 2026 through better scale, purchasing leverage, and cost-out actions.
Balance sheet, cash, and free cash flow framework
Ranpak ended 2025 with $63 million of cash and no borrowings on its revolver, with reported net leverage of 4.4x on a last-twelve-month basis. Drew said the company’s leverage goal remains 2.5x to 3.0x and that management believes it can reach that range over the next 18 to 24 months.
Capital expenditures totaled $30.3 million in 2025, down $2.8 million from 2024 and down significantly from $55 million in 2023, as the company prioritized cash discipline.
On free cash flow expectations for 2026, Drew walked through a framework based on the midpoint of guidance, including non-cash warrant expense, projected capital spending of roughly $37.5 million (with potential to be less), cash interest of about $34 million, cash taxes of $3 million to $4 million, and an expected working capital use of about $5 million tied to inventory initiatives for larger customers. He said those items imply about $15 million in free cash for the year.
2026 outlook: growth guidance tempered by geopolitical uncertainty
For 2026, management guided to constant-currency net revenue growth of 5% to 12.7% and Adjusted EBITDA growth of 5.4% to 19.9%. Using a spot rate assumption of 1.16 EUR to the U.S. dollar, Asali said this implies net revenue of $415 million to $445 million and Adjusted EBITDA of $83.5 million to $95 million. The guidance includes a non-cash reduction of $5 million to $7 million related to warrant expense recognition.
Automation was expected to grow 30% to 50% in 2026, potentially exceeding $60 million in revenue, with management targeting a move to positive Adjusted EBITDA contribution. For protective packaging solutions (PPS), Asali said the company expects low-to-high single-digit volume growth, noting a tough comparison in the first quarter tied to prior-year paper market disruptions and distributor restocking. He also said adverse weather in January and February contributed to a “choppy start” in North America, while feedback from distributors and end users suggested continued strength as the year progresses.
Management also updated investors on the rationale for adjusting guidance. Asali said the company lowered its outlook “over the past few days” due to conflict in the Middle East and related uncertainty, including potential effects on European energy pricing and demand. While he said Ranpak’s direct cost exposure to elevated Dutch TTF gas prices was “under control” and concentrated in less than half of its recycled paper buy, he emphasized that the larger risk could be softer demand if elevated energy prices pressure European sentiment.
Looking longer term, Asali reiterated Ranpak’s expectation of more than $1 billion in cumulative revenue over the next 8 to 10 years from two large e-commerce and retail relationships, and said the company is working to accelerate that timeline. He also pointed to structural tailwinds in automation tied to labor shortages and, in Europe, packaging-related regulation (PPWR) that encourages reduced packaging waste and unnecessary packaging volume.
About Ranpak (NYSE:PACK)
Ranpak Holdings Corp. (NYSE: PACK) is a leading provider of sustainable, paper-based packaging solutions designed to protect products during transit. The company’s core business centers on the design, manufacture and distribution of automated systems and consumable paper packaging materials that offer an eco-friendly alternative to plastic-based void-fill and protective packaging. Ranpak’s solutions include crumpled paper fillers, paper wrap systems and tailored automation equipment that serve diverse end markets such as e-commerce, industrial parts, electronics and retail.
Founded in 1972 and headquartered in Concord Township, Ohio, Ranpak has built a global presence by combining innovation in paper converting technology with a commitment to sustainability.
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