Household products company Reynolds (NASDAQ: REYN) announced better-than-expected revenue in Q4 CY2025, with sales up 1.3% year on year to $1.03 billion. On the other hand, next quarter’s revenue guidance of $809.8 million was less impressive, coming in 3.3% below analysts’ estimates. Its non-GAAP profit of $0.59 per share was in line with analysts’ consensus estimates.
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Reynolds (REYN) Q4 CY2025 Highlights:
- Revenue: $1.03 billion vs analyst estimates of $1.01 billion (1.3% year-on-year growth, 2.9% beat)
- Adjusted EPS: $0.59 vs analyst estimates of $0.59 (in line)
- Adjusted EBITDA: $220 million vs analyst estimates of $214.5 million (21.3% margin, 2.5% beat)
- Revenue Guidance for Q1 CY2026 is $809.8 million at the midpoint, below analyst estimates of $837.9 million
- Adjusted EPS guidance for the upcoming financial year 2026 is $1.60 at the midpoint, missing analyst estimates by 8.3%
- EBITDA guidance for the upcoming financial year 2026 is $667.5 million at the midpoint, below analyst estimates of $681.8 million
- Operating Margin: 17%, in line with the same quarter last year
- Free Cash Flow Margin: 19.3%, up from 13.8% in the same quarter last year
- Organic Revenue rose 1% year on year (beat)
- Sales Volumes fell 2% year on year (2% in the same quarter last year)
- Market Capitalization: $4.59 billion
Company Overview
Best known for its aluminum foil, Reynolds (NASDAQ: REYN) is a household products company whose products focus on food storage, cooking, and waste.
Revenue Growth
A company’s long-term sales performance is one signal of its overall quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years.
With $3.72 billion in revenue over the past 12 months, Reynolds carries some recognizable products but is a mid-sized consumer staples company. Its size could bring disadvantages compared to larger competitors benefiting from better brand awareness and economies of scale.
As you can see below, Reynolds struggled to increase demand as its $3.72 billion of sales for the trailing 12 months was close to its revenue three years ago. This is mainly because consumers bought less of its products - we’ll explore what this means in the "Volume Growth" section.
This quarter, Reynolds reported modest year-on-year revenue growth of 1.3% but beat Wall Street’s estimates by 2.9%. Company management is currently guiding for a 1% year-on-year decline in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 1.2% over the next 12 months. While this projection suggests its newer products will spur better top-line performance, it is still below average for the sector.
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Volume Growth
Revenue growth can be broken down into changes in price and volume (the number of units sold). While both are important, volume is the lifeblood of a successful staples business as there’s a ceiling to what consumers will pay for everyday goods; they can always trade down to non-branded products if the branded versions are too expensive.
To analyze whether Reynolds generated its growth (or lack thereof) from changes in price or volume, we can compare its volume growth to its organic revenue growth, which excludes non-fundamental impacts on company financials like mergers and currency fluctuations.
Over the last two years, Reynolds’s average quarterly sales volumes have shrunk by 1%. This isn’t ideal for a consumer staples company, where demand is typically stable.
In Reynolds’s Q4 2025, sales volumes dropped 2% year on year. This result represents a further deceleration from its historical levels, showing the business is struggling to move its products.
Key Takeaways from Reynolds’s Q4 Results
We enjoyed seeing Reynolds beat analysts’ organic revenue expectations this quarter. We were also happy its revenue outperformed Wall Street’s estimates. On the other hand, its gross margin missed and its revenue guidance for next quarter fell short of Wall Street’s estimates. Overall, this print was mixed. The stock remained flat at $21.69 immediately after reporting.
Big picture, is Reynolds a buy here and now? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here (it’s free).
