Household products company Reynolds (NASDAQ: REYN) reported Q2 CY2025 results exceeding the market’s revenue expectations, but sales were flat year on year at $938 million. On the other hand, next quarter’s revenue guidance of $887.3 million was less impressive, coming in 1.1% below analysts’ estimates. Its non-GAAP profit of $0.39 per share was 3.9% above analysts’ consensus estimates.

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“We are executing well in a challenging operating environment while also investing in the long-term potential of our business,” said Scott Huckins, President and Chief Executive Officer.

Company Overview

Best known for its aluminum foil, Reynolds (NASDAQ: REYN) is a household products company whose products focus on food storage, cooking, and waste.

Revenue Growth

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can put up a good quarter or two, but many enduring ones grow for years.

With $3.69 billion in revenue over the past 12 months, Reynolds carries some recognizable products but is a mid-sized consumer staples company. Its size could bring disadvantages compared to larger competitors benefiting from better brand awareness and economies of scale.

As you can see below, Reynolds struggled to increase demand as its $3.69 billion of sales for the trailing 12 months was close to its revenue three years ago. This is mainly because consumers bought less of its products - we’ll explore what this means in the "Volume Growth" section.

This quarter, Reynolds’s $938 million of revenue was flat year on year but beat Wall Street’s estimates by 4%. Company management is currently guiding for a 2.5% year-on-year decline in sales next quarter.

Looking further ahead, sell-side analysts expect revenue to decline by 1.1% over the next 12 months, similar to its three-year rate. This projection is underwhelming and suggests its products will see some demand headwinds.

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Volume Growth

Revenue growth can be broken down into changes in price and volume (the number of units sold). While both are important, volume is the lifeblood of a successful staples business as there’s a ceiling to what consumers will pay for everyday goods; they can always trade down to non-branded products if the branded versions are too expensive.

To analyze whether Reynolds generated its growth (or lack thereof) from changes in price or volume, we can compare its volume growth to its organic revenue growth, which excludes non-fundamental impacts on company financials like mergers and currency fluctuations.

Over the last two years, Reynolds’s average quarterly volumes have shrunk by 1.9%. This isn’t ideal for a consumer staples company, where demand is typically stable. In the context of its 2.5% average organic sales declines, we can see that most of the company’s losses have come from fewer customers purchasing its products.

In Reynolds’s Q2 2025, sales volumes jumped 1% year on year. This result was a well-appreciated turnaround from its historical levels, showing the company is heading in the right direction.

Key Takeaways from Reynolds’s Q2 Results

We were impressed by how significantly Reynolds blew past analysts’ organic revenue, EPS, and EBITDA expectations this quarter. We were also glad its full-year EBITDA guidance outperformed Wall Street’s estimates. On the other hand, its gross margin missed and its revenue guidance for next quarter fell slightly short. Overall, this print was mixed but still had some key positives. The stock remained flat at $21.68 immediately after reporting.

Indeed, Reynolds had a rock-solid quarterly earnings result, but is this stock a good investment here? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free.