Avery Dennison Q3 Earnings Beat Estimates, Revenues Rise Y/Y

Core Insights - Avery Dennison Corporation (AVY) reported third-quarter 2025 adjusted earnings of $2.37 per share, exceeding the Zacks Consensus Estimate of $2.32, with a year-over-year increase of 1.7% driven by productivity gains [1][10] - Total revenues for the quarter grew 1.5% year over year to $2.22 billion, surpassing the Zacks Consensus Estimate of $2.21 billion [2][10] - The company expects adjusted EPS for the fourth quarter of 2025 to be between $2.35 and $2.45 [8][10] Financial Performance - The cost of sales increased 1.5% year over year to $1.58 billion, while gross profit improved 1.3% to $635 million, maintaining a gross margin of 28.7% [2] - Marketing, general and administrative expenses rose to $354 million from $347 million in the previous year, with adjusted operating profit around $281 million, slightly up from $280 million [3] - The adjusted operating margin was 12.7%, a slight decrease from 12.8% in the prior year [3] Segment Performance - Revenues in the Materials Group segment increased 1.2% year over year to $1.52 billion, with an adjusted operating profit growth of 3.6% to $230 million [4] - The Solutions Group saw revenues rise 2% year over year to $699.5 million, but adjusted operating income decreased by 9.9% to $69.7 million [5] Cash and Debt Position - The company returned $670 million to shareholders through share repurchases and dividends in the first nine months of 2025, repurchasing 2.5 million shares [6] - At the end of the quarter, cash and cash equivalents stood at $536 million, up from $213 million a year ago, while long-term debt increased to $3.20 billion from $2.04 billion [7] Stock Performance - AVY shares have decreased by 19.6% over the past year, compared to a 33.8% decline in the industry [9]