Shares of International Paper fell 5.4% following first quarter results, as a more cautious full-year industry demand outlook and persistent operational cost pressures weighed on investor sentiment. While North American box volume outperformed peers, progress was not sufficient to offset expectations for flat 2026 industry demand and lingering execution challenges.

• Management reduced their full year 2026 industry demand outlook to "approximately flat year-over-year" from prior "flat to up 1%" assumptions, citing ongoing macroeconomic headwinds.
• North American box volumes grew 2.5% year-over-year in Q1, outperforming the industry by nearly 3%, with expectations to continue outpacing peers in Q2.
• Operational and transformation costs remained higher than planned, driven by both internal execution issues and external factors such as inflation and weather disruptions.
• EMEA segment underperformed the broader market in volume as management prioritized maintaining pricing amid a softer demand environment.
• Significant investments and productivity initiatives are underway, but management acknowledged improvements are not materializing quickly enough to fully offset macro and cost headwinds.