Procter & Gamble on Thursday reported mixed quarterly results as demand for its products fell, gave a dimmer outlook for the current quarter and said price hikes could be coming.
The company, which owns Tide and Charmin, slashed its forecast for core earnings per share and revenue for the full fiscal year, which is in its final quarter. Executives cited a consumer slowdown, new tariffs and the company’s plans to invest back into its brands during a period of uncertainty as the reasons for its slashed outlook.
P&G already makes many of the products sold domestically in the U.S., but President Donald Trump’s tariffs will likely raise some of its costs.
“There will likely be pricing — tariffs are inherently inflationary — but we’re also looking at sourcing options,” Moeller said on CNBC’s “Squawk Box” on Thursday.
He added that price hikes tied to the tariffs would occur in the next fiscal year, which starts in July, coincidentally when the Trump administration’s “reciprocal” tariffs are expected to rise after a temporary abatement.
Shares of the company fell more than 1% in premarket trading.
Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG:
- Earnings per share: $1.54 vs. $1.53 expected
- Revenue: $19.78 billion vs. $20.11 billion expected
Net sales dropped 2% to $19.78 billion. The company’s organic sales, which strip out acquisitions, divestitures and foreign currency, rose 1%.
P&G’s volume fell 1% in the quarter. Volume excludes pricing, which makes it a more accurate reflection of demand than sales.
Uncertainty around tariffs, the political environment and other factors resulted in “a more nervous consumer” pulling back in the last two months of the quarter, CFO Andre Schulten said on the company’s call with media.
“It’s not illogical to see the consumer adopt the ‘wait and see’ attitude, and we saw traffic down at retailers,” Schulten said. “We saw consumers basically looking for value, migrating into online, bigger box retail, into club [retailers].”
P&G’s baby, feminine and family care division reported a 2% decline in the volume, the steepest decrease of its segments. All three parts of the business, which include Pampers diapers and Bounty paper towels, saw volume shrink during the quarter.
Both P&G’s health care and fabric and home care divisions saw volume fall 1%. Demand for its oral care products, like Oral-B toothbrushes and Crest toothpaste, shrank during the quarter. So did demand for its home care products, which include Cascade detergent and Swiffer mops.
The company’s beauty segment, which includes Olay and SK-II, reported flat volume for the quarter. P&G said volume declined in Greater China, its second-largest market. The U.S. and China are locked in a tit-for-tat trade conflict with triple-digit duties on imports.
P&G’s grooming business, which includes Gillette and Venus razors, was the only segment to report volume growth. Its volume ticked up 1%.
With one quarter left in its fiscal year, P&G is now expecting flat sales growth for fiscal 2025, down from its prior forecast of revenue growth of 2% to 4%. The company also cut its core earnings per share outlook to $6.72 to $6.82, down from its previous outlook of $6.91 to $7.05.
P&G reported third-quarter net income attributable to the company of $3.77 billion, or $1.54 per share, up from $3.75 billion, or $1.52 per share, a year earlier.
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