AptarGroup's Q3 Net Income Jumps 28% on Strong Sales, Equity Gain

TL;DR

**ATR is crushing it with a 28% net income jump, making it a solid buy for growth-focused investors.**

AI Summary

AptarGroup, Inc. (ATR) reported a robust financial performance for the three and nine months ended September 30, 2025. Net sales for the three-month period increased by 5.7% to $961.1 million from $909.3 million in the prior year, while net income attributable to AptarGroup, Inc. surged by 27.9% to $127.9 million from $100.0 million. Diluted EPS also saw a significant rise, reaching $1.92 compared to $1.48 in the same quarter of 2024. For the nine-month period, net sales grew to $2.81 billion from $2.73 billion, an increase of 2.9%, and net income attributable to AptarGroup, Inc. increased by 16.4% to $318.4 million from $273.6 million. A key business change was a significant gain from the remeasurement of an equity method investment, contributing $26.5 million to other income for both the three and nine-month periods. The company also experienced increased operating expenses, with cost of sales rising to $598.0 million for the quarter and depreciation and amortization increasing to $75.2 million. Cash provided by operations decreased to $386.3 million for the nine months ended September 30, 2025, from $465.2 million in the prior year, primarily due to changes in working capital, including a $66.8 million increase in accounts and other receivables. Strategic outlook includes continued evaluation of new accounting standards like ASU 2023-09 and ASU 2024-03, which will impact future disclosures.

Why It Matters

AptarGroup's strong Q3 performance, particularly the 27.9% net income increase, signals robust operational efficiency and strategic investment success, which is positive for investors. The significant gain from the remeasurement of an equity method investment highlights effective capital allocation and potential for future growth, positioning ATR favorably against competitors in the packaging and dispensing solutions market. For employees, this financial health suggests stability and potential for continued investment in innovation and development. Customers benefit from a financially strong supplier capable of sustained product development and reliable service. The broader market sees a resilient player in the industrial sector, contributing to overall economic confidence.

Risk Assessment

Risk Level: medium — While net income and sales are up, the company's cash provided by operations decreased by $78.9 million, from $465.2 million in 2024 to $386.3 million in 2025, primarily due to a $66.8 million increase in accounts and other receivables. Additionally, treasury stock purchases significantly increased to $190.0 million for the nine months ended September 30, 2025, compared to $31.3 million in the prior year, indicating substantial capital outflow for share repurchases.

Analyst Insight

Investors should consider AptarGroup's strong net income growth and strategic equity gains as positive indicators. However, they should closely monitor the decrease in cash flow from operations and the substantial increase in treasury stock purchases, which could impact liquidity. A deeper dive into the specific equity method investment that generated the $26.5 million gain would provide further insight into future growth potential.

Financial Highlights

revenue

$961.1M

operating Margin

14.25%

net Income

$127.9M

eps

$1.92

revenue Growth

+5.7%

Revenue Breakdown

Key Numbers

• $961.1M — Net Sales (Q3 2025) (Increased by 5.7% from $909.3M in Q3 2024)
• $127.9M — Net Income Attributable to AptarGroup, Inc. (Q3 2025) (Increased by 27.9% from $100.0M in Q3 2024)
• $1.92 — Diluted EPS (Q3 2025) (Increased from $1.48 in Q3 2024)
• $2.81B — Net Sales (Nine Months 2025) (Increased by 2.9% from $2.73B in Nine Months 2024)
• $318.4M — Net Income Attributable to AptarGroup, Inc. (Nine Months 2025) (Increased by 16.4% from $273.6M in Nine Months 2024)
• $26.5M — Gain from remeasurement of equity method investment (Significant contributor to other income in Q3 and Nine Months 2025)
• $386.3M — Net Cash Provided by Operations (Nine Months 2025) (Decreased from $465.2M in Nine Months 2024)
• $66.8M — Increase in Accounts and Other Receivables (Contributed to decrease in cash from operations)
• $190.0M — Treasury Stock Purchased (Nine Months 2025) (Increased significantly from $31.3M in Nine Months 2024)

Key Players & Entities

• AptarGroup, Inc. (company) — registrant
• SEC (regulator) — Securities and Exchange Commission
• FASB (regulator) — Financial Accounting Standards Board
• New York Stock Exchange (regulator) — exchange where Common Stock is registered
• ASU 2022-03 (other) — Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions
• ASU 2023-07 (other) — Improvement to Reportable Segment Disclosures
• ASU 2023-09 (other) — Improvements to Income Tax Disclosures
• ASU 2024-03 (other) — Disaggregation of Income Statement Expenses
• ASU 2025-01 (other) — clarifying the effective date of ASU 2024-03

FAQ

Risk Factors

• Increased Operating Expenses [medium — operational]: Cost of sales increased to $598.0 million for the quarter, and depreciation and amortization rose to $75.2 million. This indicates rising input costs and capital expenditure, potentially impacting margins if not offset by pricing or efficiency gains.
• Decreased Cash from Operations [medium — financial]: Cash provided by operations decreased to $386.3 million for the nine months ended September 30, 2025, from $465.2 million in the prior year. A significant factor was a $66.8 million increase in accounts and other receivables, suggesting potential challenges in collecting payments or increased inventory build-up.
• New Accounting Standards [low — regulatory]: The company is evaluating new accounting standards such as ASU 2023-09 and ASU 2024-03. These changes could impact future financial disclosures and reporting, requiring adaptation and potentially affecting comparability.

Industry Context

AptarGroup operates in the packaging industry, facing competition from diverse players offering specialized solutions for consumer products, pharmaceuticals, and beauty markets. Trends include a growing demand for sustainable packaging, innovative dispensing technologies, and supply chain resilience. The company's focus on specialized dispensing systems positions it to capitalize on these trends.

Regulatory Implications

The company must navigate evolving accounting standards (ASU 2023-09, ASU 2024-03) which will impact future financial reporting and disclosures. Compliance with these standards requires careful analysis and implementation to ensure accurate and transparent financial statements.

What Investors Should Do

1. Analyze the impact of the equity method investment gain.
2. Monitor working capital management.
3. Evaluate the sustainability of margins.
4. Assess the impact of new accounting standards.

Glossary

Gain from remeasurement of equity method investment

This refers to a one-time gain recognized when a company adjusts the carrying value of an investment accounted for using the equity method to its fair value. This often occurs upon gaining or losing control of the investee or when the investment is reclassified. (A significant $26.5 million gain boosted 'Other Income' for the period, artificially inflating net income and impacting the comparability of operating performance.)

Equity method investment

An accounting method where an investor records its share of the investee's net income or loss in its own income statement, and adjusts the investment's carrying value accordingly. It's typically used when an investor has significant influence but not control over the investee. (The remeasurement of such an investment led to a substantial one-time gain, affecting the 'Other Income' line item.)

ASU 2023-09

Accounting Standards Update 2023-09, which relates to the disclosure of income tax expense. It requires companies to disclose income tax expense disaggregated by jurisdiction. (This standard, along with ASU 2024-03, will impact how AptarGroup reports its tax-related information in future filings.)

ASU 2024-03

Accounting Standards Update 2024-03, which pertains to the accounting for and disclosure of cloud computing arrangements. (This standard may affect how AptarGroup accounts for and discloses its arrangements related to cloud computing services.)

Year-Over-Year Comparison

Compared to the prior year, AptarGroup demonstrated strong top-line growth with net sales increasing by 5.7% to $961.1 million in Q3 2025. Net income saw a substantial rise of 27.9% to $127.9 million, partly due to a significant one-time gain from an equity method investment. However, operating cash flow declined by 17.0% to $386.3 million for the nine-month period, primarily driven by an increase in receivables. Diluted EPS also improved significantly to $1.92 from $1.48.

Filing Documents

• atr-20250930.htm (10-Q) — 2320KB
• atr-20250930x10qexx311.htm (EX-31.1) — 11KB
• atr-20250930x10qexx312.htm (EX-31.2) — 12KB
• atr-20250930x10qexx321.htm (EX-32.1) — 5KB
• atr-20250930x10qexx322.htm (EX-32.2) — 5KB
• atr-20250930_g1.jpg (GRAPHIC) — 3KB
• 0000896622-25-000033.txt ( ) — 12525KB
• atr-20250930.xsd (EX-101.SCH) — 68KB
• atr-20250930_cal.xml (EX-101.CAL) — 124KB
• atr-20250930_def.xml (EX-101.DEF) — 384KB
• atr-20250930_lab.xml (EX-101.LAB) — 919KB
• atr-20250930_pre.xml (EX-101.PRE) — 668KB
• atr-20250930_htm.xml (XML) — 2334KB

Financial Statements (Unaudited)

Financial Statements (Unaudited) Condensed Consolidated Statements of Income – Three and Nine Months Ended Septem ber 30, 2025 and 2024 1 Condensed Consolidated Statements of Comprehensive Income – Three and Nine Months Ended September 30, 2025 and 2024 2 Condensed Consolidated Balance Sheets – September 30, 2025 and December 31, 2024 3 Condensed Consolidated Statements of Changes in Equity – Three and Nine Months Ended Septemb er 30, 2025 and 2024 5 Condensed Consolidated Statements of Cash Flows - Nine Months Ended September 30, 2025 and 2024 7 Notes to Condensed Consolidated Financial Statements 8 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 33 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 50 Item 4.

Controls and Procedures

Controls and Procedures 50 Part II. OTHER INFORMATION I tem 1. L egal Proceedings 51 I tem 1A. R isk Factors 51 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 52 Item 5. Other Information 52 Item 6. Exhibits 53 Signature 54 i Table of Contents

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION

FINANCIAL STATEMENTS (UNAUDITED)

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED) AptarGroup, Inc. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) In thousands, except per share amounts Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 2025 2024 Net Sales $ 961,131 $ 909,291 $ 2,814,445 $ 2,734,802 Operating Expenses: Cost of sales (exclusive of depreciation and amortization shown below) 598,046 558,511 1,747,931 1,708,707 Selling, research & development and administrative 148,760 141,604 455,176 443,714 Depreciation and amortization 75,234 67,015 210,785 196,332 Restructuring initiatives 2,168 3,864 5,789 9,659 Total Operating Expenses 824,208 770,994 2,419,681 2,358,412 Operating Income 136,923 138,297 394,764 376,390 Other (Expense) Income: Interest expense ( 13,532 ) ( 12,290 ) ( 35,733 ) ( 32,526 ) Interest income 2,400 3,022 7,094 9,022 Net investment (loss) gain ( 161 ) 1,043 845 1,495 Equity in results of affiliates 1,747 ( 77 ) 6,142 ( 168 ) Gain from remeasurement of equity method investment 26,518 — 26,518 — Miscellaneous expense, net 232 1,136 226 ( 518 ) Total Other (Expense) Income 17,204 ( 7,166 ) 5,092 ( 22,695 ) Income before Income Taxes 154,127 131,131 399,856 353,695 Provision for Income Taxes 26,295 31,209 81,629 80,382 Net Income $ 127,832 $ 99,922 $ 318,227 $ 273,313 Net (Income) Loss Attributable to Noncontrolling Interests ( 47 ) 117 76 284 Net Loss Attributable to Redeemable Noncontrolling Interests 142 — 142 — Net Income Attributable to AptarGroup, Inc. $ 127,927 $ 100,039 $ 318,445 $ 273,597 Net Income Attributable to AptarGroup, Inc. per Common Share: Basic $ 1.95 $ 1.51 $ 4.83 $ 4.13 Diluted $ 1.92 $ 1.48 $ 4.75 $ 4.05 Average Number of Shares Outstanding: Basic 65,709 66,445 65,989 66,274 Diluted 66,630 67,716 67,043 67,574 Dividends per Common Share $ 0.45 $ 0.45 $ 1.35 $ 1.27 See accompanying unaudited Notes to Condensed Consolidated Financial Statements. 1 Table of Contents AptarGroup,

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