Avery Dennison reported a solid Q1 2026 with EPS growth driven by volume and productivity, offsetting softer high-value categories. The company is navigating a sharp shift to raw material inflation by implementing price increases, and expects pre-buying activity to unwind in Q2, while the intelligent labels business is set for a strong second-half ramp. Q1 adjusted EPS of $2.47, up 7% vs prior year, benefited from a ~$0.05 pre-buy tailwind.
Avery Dennison reported a solid Q1 2026 with EPS growth driven by volume and productivity, offsetting softer high-value categories. The company is navigating a sharp shift to raw material inflation by implementing price increases, and expects pre-buying activity to unwind in Q2, while the intelligent labels business is set for a strong second-half ramp. Q1 adjusted EPS of $2.47, up 7% vs prior year, benefited from a ~$0.05 pre-buy tailwind.
Avery Dennison reported a solid Q1 2026 with EPS growth driven by volume and productivity, offsetting softer high-value categories. The company is navigating a sharp shift to raw material inflation by implementing price increases, and expects pre-buying activity to unwind in…
Q1 adjusted EPS of $2.47, up 7% vs prior year, benefited from a ~$0.05 pre-buy tailwind.
Management expressed confidence in navigating inflation and supply chain disruptions through proven playbooks, productivity, and innovation investments, while acknowledging near-term headwinds.
Intelligent labels sales were down low single-digits in Q1 due to a logistics slowdown, but are expected to accelerate in H2 2026 driven by a major food retailer ramp.
Pre-buying tailwind expected to unwind in Q2. Management expressed confidence in navigating inflation and supply chain disruptions through proven playbooks, productivity, and innovation investments, while acknowledging near-term headwinds.
Management did not discuss capital expenditure in detail beyond reaffirming fixed and IT capital spending of approximately $260 million for the year.
Management expressed confidence in navigating inflation and supply chain disruptions through proven playbooks, productivity, and innovation investments, while acknowledging near-term headwinds.
“we had about a nickel benefit of pre-buying Q1, which then comes out of the second quarter, which creates really a 10-cent swing from the first quarter to the second quarter.”
“The majority of what we saw in logistics office was down to end customer demand volumes, and I think you've seen that publicly announced today as well.”
“we are anticipating high single-digit sequential inflation in the second quarter.”
| Показатель | Период | Диапазон | Середина | Статус |
|---|---|---|---|---|
| EPS | FY2026 Q2 | $2.43–$2.53 | $2.48 | GUIDED |
| Дата прогноза | Показатель | Целевой период | Прогноз | Факт | Результат |
|---|---|---|---|---|---|
| FY2025 Q4 | EPS | FY2026 Q1 | $2.40–$2.46 | $2.47 | Met / beat |
Avery Dennison expects a significant ramp in intelligent labels from Walmart in the back half of 2026, indicating strong demand from this key customer.
“We talked about the Walmart ramp for us in the second half of the year.”
Yeah, thank you, operator. Good morning, everybody. So on intelligent labels, how does that play out relative to your initial expectations for 1Q? And also, has your view on 2026 core sales for this business changed just given the events over the past couple of months or so?
Hi, Gancham. Q1 played out slightly lower than we had anticipated, mostly on the logistics volume that we saw, both at the customer level and some changes that they were managing through inventory as preparation for a new chip that they were having. While we haven't given an outlook for the rest of the year, I still believe we're going to see growth through the whole of 26 relative to 2025 overall, Gancham. And in particular, because we're going to see the second half of the year when we're going to see some of the new programs ramp, particularly in food. We talked about the Walmart ramp for us in the second half of the year. We also have a number of other apparel programs that were planned in and a couple new ones that are also coming along as well. And so overall, while it's difficult to know what the second half of the year will play out from a macro perspective, I feel good about our ability to drive those new programs and have them roll out. And hence, we'll start to see an expansion in our growth rate as we go through the year.