Avery Dennison Corporation (NYSE:AVY) shares are trading higher on Wednesday.
The company reported third-quarter adjusted earnings per share of $2.37, beating the analyst consensus estimate of $2.33. Quarterly sales of $2.216 billion (+1.5% year over year) missed the Street view of $2.22 billion.
In the quarter under review, the company reported operating income of $264 million. The adjusted EBITDA margin was 16.5%, up 10 bps, and the adjusted operating margin was 12.7%, down 10 bps.
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Avery Dennison said indirect tariff impacts improved sequentially, but overall uncertainty persists. About 70% of Solutions Group sales are in tariff-affected apparel and general retail end markets.
Avery Dennison noted that uneven customer order patterns are limiting near-term visibility.
Materials Group reported sales rose 1.2% to $1.5 billion, though organic sales fell 1.9%.
Solutions Group reported sales increased 2% to $700 million, driven by an organic sales rise of 3.6%.
Through the first three quarters of 2025, the company returned $670 million in cash to shareholders through a combination of share repurchases and dividends.
In September, the company said it issued €500 million of 4.00% senior notes due 2035. The company said intends to use the net proceeds of the offering for general corporate purposes.
Partnership With Walmart
Walmart Inc. (NYSE:WMT) and Avery Dennison unveiled an RFID breakthrough for fresh foods once considered too challenging to tag accurately.
The innovation improves visibility across bakery, meat, and deli, streamlining inventory and elevating associate and shopper experiences.
Automated item-level identification helps reduce waste, safeguard freshness, and enable faster replenishment decisions in complex cold chains.
The effort supports Walmart's sustainability agenda, targeting a 50% cut in operational food loss and waste intensity by 2030.
Together, the companies aim to make fresh-food operations smarter, more responsive, and better for consumers, producers, and retailers.
Outlook
Avery Dennison said macroeconomic uncertainty remains elevated. The company continues to advance key initiatives aimed at accelerating profitable growth.
It said it expects fourth-quarter GAAP earnings per share in the range of $2.15 to $2.25, compared with the analyst consensus estimate of $2.43.
The company also projects adjusted EPS between $2.35 and $2.45, aligning closely with the Street's forecast of $2.45.
Full-year Considerations
The currency translation tailwind to operating income is now about $5 million, down from roughly $7 million previously.
Incremental savings from net restructuring actions are expected to be about $60 million, up from approximately $50 million before.
Price Action: AVY shares are trading higher by 7.63% to $176 at last check Wednesday.
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