Crown Holdings’s (NYSE:CCK) Q1 Sales Top Estimates

Metal packaging products manufacturer Crown Holdings (NYSE:CCK) reported Q1 CY2025 results topping the market’s revenue expectations, with sales up 3.7% year on year to $2.89 billion. Its non-GAAP profit of $1.67 per share was 35.7% above analysts’ consensus estimates.

Is now the time to buy Crown Holdings? Find out by accessing our full research report, it’s free.

"Crown got off to an excellent start for the year, driven by strong performances in each of our global beverage can businesses," said Timothy J. Donahue, Chairman, President and Chief Executive Officer.

Company Overview

Formerly Crown Cork & Seal, Crown Holdings (NYSE:CCK) produces packaging products for consumer marketing companies, including food, beverage, household, and industrial products.

Sales 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. Unfortunately, Crown Holdings struggled to consistently increase demand as its $11.9 billion of sales for the trailing 12 months was close to its revenue five years ago. This wasn’t a great result and is a sign of poor business quality.

Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. Crown Holdings’s recent performance shows its demand remained suppressed as its revenue has declined by 3.4% annually over the last two years. Crown Holdings isn’t alone in its struggles as the Industrial Packaging industry experienced a cyclical downturn, with many similar businesses observing lower sales at this time.

This quarter, Crown Holdings reported modest year-on-year revenue growth of 3.7% but beat Wall Street’s estimates by 1.5%.

Looking ahead, sell-side analysts expect revenue to grow 1.3% over the next 12 months. While this projection indicates its newer products and services will spur better top-line performance, it is still below average for the sector.

Unless you’ve been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) stock benefiting from the rise of AI. Click here to access our free report one of our favorites growth stories.

Operating Margin

Operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses – everything from the cost of goods sold to advertising and wages. It’s also useful for comparing profitability across companies with different levels of debt and tax rates because it excludes interest and taxes.

Crown Holdings has managed its cost base well over the last five years. It demonstrated solid profitability for an industrials business, producing an average operating margin of 10.9%. This result was particularly impressive because of its low gross margin, which is mostly a factor of what it sells and takes huge shifts to move meaningfully. Companies have more control over their operating margins, and it’s a show of well-managed operations if they’re high when gross margins are low.

Looking at the trend in its profitability, Crown Holdings’s operating margin rose by 3.2 percentage points over the last five years. Its expansion was impressive, especially when considering the cycle turned in the wrong direction and most of its Industrial Packaging peers observed plummeting revenue and margins.

This quarter, Crown Holdings generated an operating profit margin of 12.6%, up 3.8 percentage points year on year. The increase was encouraging, and because its operating margin rose more than its gross margin, we can infer it was more efficient with expenses such as marketing, R&D, and administrative overhead.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Crown Holdings’s EPS grew at an unimpressive 6.3% compounded annual growth rate over the last five years. On the bright side, this performance was better than its flat revenue and tells us management responded to softer demand by adapting its cost structure.

We can take a deeper look into Crown Holdings’s earnings to better understand the drivers of its performance. As we mentioned earlier, Crown Holdings’s operating margin expanded by 3.2 percentage points over the last five years. On top of that, its share count shrank by 13.3%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For Crown Holdings, its two-year annual EPS growth of 9.1% was higher than its five-year trend. Accelerating earnings growth is almost always an encouraging data point.

In Q1, Crown Holdings reported EPS at $1.67, up from $1.02 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Crown Holdings’s full-year EPS of $7.06 to shrink by 1.5%.

Key Takeaways from Crown Holdings’s Q1 Results

This was a nice beat and raise quarter. We were impressed by how significantly Crown Holdings blew past analysts’ EPS expectations this quarter on a smaller revenue beat. We were also excited that the company raised its full-year EPS guidance. Zooming out, we think this was a good quarter with some key areas of upside. The stock traded up 4.4% to $93.71 immediately after reporting.

Crown Holdings had an encouraging quarter, but one earnings result doesn’t necessarily make the stock a buy. Let’s see if this is a good investment. The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free.