Key Takeaways:
Graphic Packaging Holding Co. told investors in February 2025 it would deliver as much as $8.9 billion in net sales and $2.78 in adjusted earnings per share for the full year. Twelve months later, adjusted EBITDA had been cut by more than $350 million from the top of its original range, the chief executive officer had resigned, and shares had lost more than half their value.
"The gap between what GPK projected in February 2025 and what it ultimately delivered raises serious questions about whether material information was withheld from the investing public," Joseph E. Levi, a partner at Levi & Korsinsky, said.
The company's original guidance on Feb. 4, 2025, called for adjusted EBITDA of $1.68 billion to $1.78 billion and adjusted EPS of $2.53 to $2.78. By Dec. 8, 2025, after two downward revisions, adjusted EBITDA had been slashed to a range of $1.38 billion to $1.43 billion — a gap of $385 million from the top end — and adjusted EPS had fallen to $1.75 to $1.95, a $0.98 per-share shortfall. Net sales guidance was cut to $8.2 billion to $8.5 billion as early as May 2025, down from the original $8.9 billion top end.
The collapse wiped out more than $12 per share in value. GPK shares closed at $12.42 on Feb. 3, 2026, down from about $25.31 before the first corrective disclosure on May 1, 2025. Three separate disclosure events triggered single-day declines of 15.57 percent, 8.66 percent and 15.97 percent, respectively. The stock now trades at its lowest level since the guidance was issued.
The securities class action, filed in the U.S. District Court, claims management knew the FY2025 guidance was unreliable when issued. The complaint alleges inventory levels had been rising since 2023, consumer demand was deteriorating beyond what management publicly acknowledged, and $80 million in input cost inflation was already foreseeable. CEO Michael Doss sold $7 million in shares, and CFO Stephen Scherger sold 65,529 shares for nearly $1.8 million before resigning in November 2025, according to the lawsuit.
On Feb. 3, 2026, incoming CEO Robbert Rietbroek announced a "comprehensive review of our organization structure, operations, and footprint" and projected a further $130 million negative EBITDA impact in 2026 from inventory reduction actions, plus $100 million in incentive compensation accruals. The company had already recorded $15 million in Q4 2025 production curtailment costs from accelerated inventory reduction plans originally scheduled for 2026.
The court has set July 6, 2026, as the deadline for investors to apply for lead plaintiff appointment. Investors who purchased GPK securities between Feb. 4, 2025, and Feb. 2, 2026, and suffered losses may be eligible for compensation. The lead plaintiff, typically the investor with the largest financial interest, directs case strategy and selects counsel on behalf of the class.
The lawsuit signals that GPK's operational challenges run deeper than short-term headwinds. Investors will watch for further disclosures from the company's ongoing operational review and any settlement developments as the July 6 lead plaintiff deadline approaches.
This article is for informational purposes only and does not constitute investment advice.
