Avery Dennison Q3 Beats Estimates, Growth Tempered

Avery Dennison reported Q3 2025 revenue of $2.22 billion, up 1.5% year‑over‑year, and adjusted EPS of $2.37, beating expectations. Net profit margin improved to 8.1% from 7.3% and free cash flow margin rose to about 12.1%, while gross and operating margins were roughly flat year‑over‑year, helped by productivity gains, cost cuts and price increases to offset inflation and tariffs. The Materials segment generated about $1.52 billion in sales with organic softness, while the Solutions group grew roughly 2% to around $700 million, driven by RFID and intelligent labels including a new RFID sensor label rollout with Walmart. Management returned $670 million to shareholders year‑to‑date, ended the quarter with roughly $536 million in cash, and maintained Q4 adjusted EPS guidance of $2.35–$2.45 (midpoint $2.40). The company also expanded via the Meridian Adhesives flooring-adhesives acquisition, but warned that longer‑term earnings and revenue growth is likely to trail the broader market despite resilient cash generation.