O-I Glass, Inc. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net sales for the quarter ended September 30, 2026, were $1,623 million, a 2% decrease from $1,653 million in the prior-year period.
• Net earnings attributable to the company were a loss of $13 million ($0.08 per share), compared to net earnings of $30 million ($0.19 per share) in the prior year.
• Adjusted earnings (non-GAAP) were a loss of $15 million ($0.09 per share), compared to adjusted earnings of $75 million ($0.48 per share) in the prior year.
• Adjusted EBITDA was $234 million, down from $329 million in the prior-year period.
• Segment operating profit was $139 million, down from $235 million in the prior-year period.
• Earnings before income taxes were $34 million, compared to $58 million in the prior year.
• Cash provided by operating activities was $165 million for the quarter, compared to $214 million in the prior year.
• Free cash flow for the quarter was calculated as cash provided by operating activities ($165 million) less cash payments for property, plant, and equipment ($81 million), resulting in $84 million.
• Total liquidity was approximately $1.5 billion at the end of the third quarter, comprising $379 million in cash and a $1,154 million revolving credit facility capacity.
• Net debt leverage ratio is expected to approximate 4.5 to 5.0 times at year-end 2026, up from 3.5 times in 2025.

Guidance and Future Outlook:

• Updated 2026 adjusted EBITDA guidance is $925 million to $950 million, revised down from a prior range of $1,000 million to $1,100 million.
• Updated 2026 free cash flow guidance is a use of approximately $300 million, revised down from a prior range of a use of $50 million to $150 million.
• The company expects higher net sales, adjusted EBITDA, and free cash flow in 2027, supported by improved commercial performance, cost reductions, and resilience in the Americas.
• The company is no longer maintaining specific 2027 targets and plans to provide 2027 guidance on its 2026 year-end earnings call.
• The revised outlook reflects soft demand, elevated energy and freight inflation, a slower pace of recovery in Europe, and higher inventory levels.
• Potential impacts from U.S.-Canada trade disputes are noted as a factor in the outlook.

Business Segments and Product Lines:

• Americas Segment: Net sales were $970 million, up 3% from the prior year, driven by a 1.6% increase in selling prices and favorable currency translation, which offset a 1.3% decline in sales volume. Segment operating profit was $137 million, down slightly from $140 million in the prior year, as Fit to Win benefits and favorable currency mostly offset lower volume and unfavorable net price.
• Europe Segment: Net sales were $634 million, down 8% from the prior year, driven by a 3.8% decrease in selling prices, a 3.7% decrease in sales volume, and unfavorable currency translation. Segment operating profit was $2 million, down significantly from $95 million in the prior year, primarily due to net price pressure and elevated energy and freight costs approximately $15 million higher than anticipated.
• Fit to Win Program: The program delivered approximately $50 million in benefits during the quarter ($135 million year-to-date). O-I now targets approximately $180 million of net benefits for 2026, down from a prior expectation of at least $200 million, and continues to expect at least $650 million of cumulative savings by the end of 2027.
• Restructuring: In late October 2026, the company initiated a process with employee representatives regarding the proposed permanent closure of a production facility in Europe. Related charges of approximately $100 million to $120 million are estimated to be recorded in the fourth quarter of 2026, including $40 million to $50 million in future cash expenditures.

Market and Competitive Landscape:

• Commercial pressures and competitive pricing are weighing on results, particularly in the Europe segment.
• Southern Europe remains under pressure, particularly in the wine category, which continues to suffer from declining consumer and export volumes.
• Shipments increased in Northern Europe, while North America faced headwinds that were largely offset by strong shipment growth in Latin America.
• Internal supply-chain challenges are compounding commercial and cost headwinds in Europe.

Risks and Challenges:

• Elevated energy and freight costs are a significant challenge, with costs in Europe approximately $15 million higher than management's expectations entering the quarter.
• Macroeconomic uncertainty, including conflicts in the Middle East, currency movements, and changes in trade or immigration policies, remains a risk to the outlook.
• The company faces risks related to the execution of global profitability improvement initiatives and the pace of recovery in Europe.
• Potential impacts from U.S.-Canada trade disputes are included in the soft demand outlook.

Management Commentary and Tone:

• CEO Gordon Hardie noted that third-quarter results demonstrated continued resilience in the Americas while Europe remained well below expectations.
• Management stated they are beginning to see initial progress in Europe, including improving production efficiency, better sequential shipment trends, and continued Fit to Win cost reductions.
• CFO John Haudrich emphasized that while near-term energy and trade conditions remain uncertain, liquidity remains strong and the company is committed to financial and operational discipline.
• Management expressed confidence that actions underway, combined with Americas resilience, are expected to support higher adjusted earnings and free cash flow in 2027.

Other Key Points:

• The company recorded a $873 million goodwill impairment charge in the first nine months of 2026, which is excluded from adjusted earnings and adjusted EBITDA.
• The company expects to release earnings materials approximately one hour before the scheduled earnings call starting with the fourth-quarter 2026 results due to anticipated extended trading on the NYSE.
• The company has approximately 19,000 employees across 61 plants in 18 countries.
• O-I Glass is a member of the S&P Small Cap 600 and a component of over 100 Exchange Traded Funds.