Ball Corp (BALL) Q2 2025: Sales Growth Tempered by Costs and Regional Mix

In its latest quarterly report filed with the SEC, Ball Corporation (NYSE: BALL), a global leader in sustainable aluminum packaging, revealed a picture of robust sales growth tempered by regional performance differences and rising costs. Let's dive into the numbers from their second quarter of 2025 to see what they tell us about the company's health and trajectory.

From Revenue to Profit

For the three months ending June 30, 2025, Ball Corp reported impressive total revenue of $3.34 billion, a significant jump from the $2.96 billion recorded in the same period last year. This growth wasn't just on the top line; net income also climbed to $215 million from $159 million a year prior.

What drove this nearly $400 million increase in sales? The company attributes it to a combination of factors: $224 million from higher sales volume, $127 million from favorable pricing and product mix (largely due to higher aluminum prices), and a $53 million boost from currency translation.

To better understand how revenue is converted into profit, the following flow diagram illustrates the company's income statement for the quarter.

While revenue grew, so did the costs to generate it. Cost of sales rose to 81% of revenue, up slightly from 80% last year. The filing points to "higher aluminum costs" as the primary culprit, highlighting the company's direct exposure to commodity price fluctuations. This resulted in a gross margin of 19.4% and an operating margin of 10.3%.

A Tale of Three Regions

Ball organizes its business into three key geographical segments, and their second-quarter performance varied significantly.

• North and Central America: As the company's largest market, this segment generated $1.61 billion in revenue. However, its comparable operating earnings—a measure of profitability before interest and taxes—slipped slightly to $208 million from $210 million last year. The filing indicates that while sales volumes were higher, the benefits were offset by a less favorable price/mix and increased costs, suggesting profitability challenges in its core market.

• EMEA (Europe, Middle East, and Africa): This region was a standout performer. Revenue surged to $1.05 billion from $880 million year-over-year, with operating earnings climbing to $129 million. Growth here was well-rounded, driven by higher volumes, better pricing, and positive currency effects.

• South America: This segment also delivered strong results. Revenue increased to $477 million, and operating earnings jumped a remarkable 38% to $51 million. The company credits this impressive earnings growth primarily to higher sales volume, indicating strong demand in the region.

Capital Strategy in Focus

Beyond its daily operations, Ball Corp was active in managing its capital. The company demonstrated confidence in its stock value by executing an accelerated share repurchase (ASR) program for $250 million. In total, Ball bought back nearly 7.6 million of its own shares during the quarter, a move that returns capital to shareholders and can boost earnings per share. The company also refinanced some of its debt, issuing new euro-denominated notes to maintain a flexible capital structure.

Looking Ahead

Ball Corporation's second quarter reflects a company successfully capitalizing on the strong global demand for its aluminum beverage containers. The robust growth in Europe and South America is a clear positive. However, the slight margin pressure from rising aluminum costs and the flat profitability in its largest market, North America, are key areas to watch.

The company operates in an environment sensitive to global economic trends, from inflation to supply chain stability. Its ability to manage commodity costs and maintain pricing discipline will be crucial for navigating the quarters ahead and continuing its growth story.