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Jun 28, 2025
ODP Q2 2025 Earnings Report
ODP Corporation announced its second quarter 2025 results, reporting revenue of $1.6 billion, GAAP EPS of $0, and Adjusted EPS of $0.51.
Key Takeaways
The ODP Corporation reported a challenging second quarter in 2025 with consolidated revenue down 8% year-over-year to $1.6 billion, primarily due to lower sales in both its Office Depot and ODP Business Solutions divisions. Despite the revenue decline, the company achieved break-even GAAP net income and diluted EPS, a significant improvement from a net loss in the prior year period. Adjusted EPS was $0.51. The company highlighted improved performance trends in its B2B Distribution and Consumer Divisions and strong adjusted free cash flow generation, which more than doubled from the prior year.
Total reported sales for Q2 2025 were $1.6 billion, an 8% decrease compared to the prior year, mainly due to fewer retail locations and reduced traffic in the Office Depot Division, and macroeconomic headwinds in ODP Business Solutions.
GAAP operating income improved significantly to $9 million in Q2 2025, up from $0.4 million in Q2 2024, while net income and diluted EPS from continuing operations were break-even, compared to a loss in the prior year.
Adjusted EBITDA was $47 million and adjusted operating income was $25 million, both lower than the prior year, but adjusted free cash flow increased substantially to $13 million from $5 million in Q2 2024.
The company ended the quarter with $658 million in total available liquidity, including $177 million in cash and cash equivalents, and reduced total debt to $245 million.
Revenue by Segment
Forward Guidance
The ODP Corporation expects continued improvement in performance for the second half of 2025, driven by top-line trend improvement in ODP Business Solutions and robust results in the consumer business. The company anticipates generating over $115 million in adjusted free cash flow for the full year 2025.
Positive Outlook
- Expected top-line trend improvement at ODP Business Solutions in H2 2025, driven by traditional product categories and hospitality expansion.
- Anticipated continued robust results in the consumer business (Office Depot), supporting strong cash generation.
- Forecasted generation of over $115 million in adjusted free cash flow for the full year 2025.
- Commitment to disciplined capital allocation in core business and pursuit of higher growth opportunities.
- Sharpened focus on inventory management opportunities expected to enhance future cash generation.
Challenges Ahead
- Outlook considers stable macroeconomic and business conditions, implying potential vulnerability to downturns.
- Company is not immune from changes in the evolving tariff landscape, though it believes it is well-positioned to adjust.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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