O-I ‘s profit from its European operations dropped by 93% compared to the same period the year before.
The figures released in its Q3 2026 financial results also showed a 5% drop in European sales.
O-I’s overall net sales were nearly $1.7 billion, down 2% from the prior year, the figures released on July 29 showed.
Performance varied significantly by region.
Strong Americas results helped offset lower earnings in Europe.
Gordon Hardie, CEO of O-I, said: “Our second quarter results fell short of expectations, driven primarily by commercial pressures, higher energy-related costs and operational challenges in Europe.
“At the same time, we believe the continued strength of our Americas business underscores the effectiveness of our Fit to Win programme and disciplined execution.
“Achieving our objectives in Europe is taking longer than expected, and we are acting decisively to address the issues affecting performance.
“While we believe these headwinds are temporary, we have adjusted our 2026 outlook and realigned our 2027 targets to reflect a more gradual rate of improvement.
“We believe our strategy is the right one, the necessary actions are underway, and disciplined execution will position O-I to unlock long-term value.”
Europe
Net sales in Europe were $704 million, down 5% from the previous year.
The company stated it expected Europe’s performance to be around $25 million better than it was.
Shipments also decreased by 2% due to disruption limiting sales opportunities.
Europe’s segment operating profit decreased from $90 million to $6 million.
O-I said this reflected competitive pricing pressure, higher energy costs and temporary operational disruption following major restructuring actions.
Its performance was impacted by higher-than-expected operating costs and two furnace events, which it said were offset by core Fit to Win benefits.
O-I said continued market challenges all contributed to lower sales.
These challenges included higher energy costs related to the Middle East conflict, adjusted Fit to Win timing due to temporary operational disruption, and additional cost at a few specific plants.
The company have upgraded its energy usage capabilities in several of its European plants, which have generated energy savings of 5-7%.
Americas
Net sales in the Americas were $949 million in the second quarter of 2026, up nearly 1% from the prior year.
Americas segment operating profit increased by 22% to $165 million, with margins expanding to 17.4%.
The company stated this increase was driven by Fit to Win benefits, as well as favourable net price and currency translation.
Shipments also decreased by 7%, constraining sales opportunities by approximately 2% and reflecting softer demand.
Fit to Win
Since its launch, Fit to Win has generated more than $400 million of net benefits.
Fit to Win delivered $65 million of gross benefits and $50 million savings of net operating disruptions.
It remains central to O-I’s strategy, and the company expects it to deliver approximately $200 million of benefits in 2026.
The company has announced all planned plant closures part of the strategy and is advancing the final stages of organisational restructuring.