Sonoco Products Company

Item 1A.

Risk Factors

Risks Related to This Quarterly Report on Form 10-Q should be read together with, and supplement, the risk factors in Item 1A Risk Factors in the Companys Annual Report on Form 10-K for the year ended December 31, 2024, which describes various risks and uncertainties to which the Company is or may become subject. The risk factor below updates certain risk factors included in the Domestic and Companys Annual Report on Form 10-K for the year ended December 31, 2024 in light of recent events. The below risk factor and the risk factors included in the Companys Annual Report on Form 10-K for the year ended December 31, 2024 are not the only risks facing the Company. Additional risks and uncertainties not currently known to the Company or that the Company currently deems to be immaterial also may materially adversely affect its business, financial condition and/or operating results.

Risks Related to the Domestic and Global Economies and to Doing Business Globally

Changes in United States trade policies and global regulations, as well as the overall uncertainty surrounding international trade relations, could materially and adversely affect our consolidated financial condition and results of operations.

We continue to face uncertainty with respect to trade relations between the United States and many of its trading partners. For example, beginning in in the first quarterhalf of 2025, the U.S. government has announced, delayed, re-imposed and revised a series of broad-based, as well as country-, bloc- and sector-specific, tariffs on imports, as well as other trade policy changes. Some countries have announced retaliatory actions or plans for retaliatory actions, which may continue to give rise to further escalations of trade measures by the United States and impacted countries. The exact scope of any tariffs or other trade policy changes that will ultimately be implemented is not known at this time, and the impacts on our business and results of operations are uncertain. Such tariffs haand other trade restrictions have had, and may in the future have, an adverse edirect effect on our costs of products sold and margins in our North and may also have an adverse indirect

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effect due to reduced demand for our products or other impacts to our customers, suppliers or other business partners. Additional measures targeting U.S. trade with China and other countries may have a further addirect and indirect adverse effects on our consolidated financial condition and results of operations. 

In addition, in July 2020, the USMCA, which replaced the North American Free Trade Agreement, became effective. In response to this agreement, other countries may change their own trade policies, including the imposition of additional tariffs and quotas, which could also adversely affect our business outside the United States. If further tariffs are imposed on a broader range of imports, further retaliatory trade measures are taken by countries in response to tariffs, or efforts are made to withdraw from or substantially modify such agreements, then we may be required to raise our prices or incur additional expenses, which may result in the loss of customers and harm our sales, earnings, business, financial condition, and results of operations. Furthermore, while the duty preferential treatment for goods that qualify for the USMCA was temporarily exempted from the Administrations 25% tariff on

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Mexican and Canadian goods, Canada has imposed retaliatory tariffs on goods coming from the United States that do not exempt USMCA-qualified goods. Some of the enumerated goods subject to this tariff include products and materials shipped to Sonocos plants in Canada, and the Company may be unable to claim end-use exemptions to mitigate the impact of such tariffs. These or any future retaliatory measures, or the removal of the exemption by the Administration, could impact our operations by increasing the cost of imported raw materials and finished goods from Canada and Mexico.

Tariff increases have in the past had, and we expect that such measures and any additional measures will have, an adverse effect on our costs of products sold and margins in our North America operations, including by increasing the cost of imported raw materials, which costs we may be unable to pass on to our customers without affecting demand, and potentially disrupting supply chains, causing delays and logistical challenges. In order to mitigate the impact of these trade-related increases on our costs of products sold, we have increased, and may in the future, increase, prices in certain markets and, over the longer term, make changes in our supply chain and potentially, our U.S.global manufacturing strategy. For example, a portion of the steel and aluminum we purchase for our metal packaging and industrial paper packaging businesses is sourced from outside the United States, and although we generally hanegotiate agreements to share tariff costs with brokers from which we purchase certain raw materials and have the contractual ability to pass on cost increases due to tariffs to our customers, anwe may be unable to maintain such cost sharing and cost pass-on practices, and any price increases may cause our customers to find alternative suppliers and result in reduced demand for our products. If we are unable to successfully reduce or pass on these costs through price increases, adjust our supply chain without incurring significant costs, or locate alternative suppliers for raw materials or finished goods at acceptable costs or in a timely manner, our net sales, costs, and margins could be adversely affected.

Higher tariffs also may increase the cost of purchasing and maintaining manufacturing equipment used in our operations. We believe the impact of higher tariffs on purchases of manufacturing equipment, while modest to our results of operations, will result in higher cash costs of such items and may therefore reduce both the number of capital projects we are able to undertake and the return on investment on such capital projects. Further, the Company may incur higher costs due to tariffs on maintenance and repair spending. If we are unable to effectively manage the impact of higher tariffs on our capital expenditures and repairs and maintenance spending through price pass-through mechanisms or locating lower-cost alternative suppliers, our results of operations, including our cash flows, could be materially and adversely affected.

Further, the uncertainty surrounding global trade policy and its broader economic impacts requires significant management attention and makes it difficult to make long-term strategic decisions regarding the best way to respond to these pressures. Such uncertainty has in the past increased, and may in the future increase the volatility of currency exchange rates. In addition, even if we are able to mitigate the direct impacts to our operations from changes in U.S. and foreign trade policy, our sales volumes have been, and may bein the future be, adversely affected by any reduction in ed sales of or demand for end products incorporating our packaging products or changes in consumer behavior, whether resulting from increased costs of such products attributable to increased tariffs or other trade barriers or the broader economic impact of such measures, such as increased inflation, decreased consumer spending or other adverse macroeconomic trends.

Our inability to effectively manage the adverse impacts of changing U.S. and foreign trade policies could materially and adversely impact our consolidated financial condition and results of operations.

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