Procter & Gamble (NYSE:PG) gained in early trading on Friday after the household products giant beat FQ1 earnings estimates. “Our organic sales growth, earnings, and cash results in the first quarter reflect strong execution of our integrated strategy,” noted CEO Jon Moeller.
Organic sales increased 2% in FQ1 to beat the consensus estimate of +1.4%.
Notably, beauty segment organic sales increased 6% year-over-year. The hair care segment’s organic sales increased low single digits, driven by volume increases and innovation-driven pricing in North America and Europe, partially offset by unfavorable geographic and product mix. The grooming segment’s organic sales increased 3% behind innovation-driven pricing, primarily in North America and Europe, and volume growth, partially offset by unfavorable product mix. Health care segment organic sales increased 1%, while Fabric and Home Care segment organic sales were unchanged.
The Cincinnati-based company reported core gross margin for the quarter decreased 50 basis points versus the prior year and, on a currency-neutral basis, decreased 30 basis points. Benefits from gross productivity savings of 140 basis points, increased pricing of 50 basis points, and 20 basis points of rounding and other items were more than offset by 100 basis points of unfavorable mix, 70 basis points of product reinvestments, and 70 basis points of higher costs from tariffs and commodities.
Looking ahead, P&G (NYSE:PG) now expects a commodity cost headwind of approximately $100 million after tax and higher costs from tariffs of approximately $400 million after tax for fiscal 2026. P&G (PG) maintained its guidance range for fiscal 2026 all-in sales growth to be in the range of +1% to +5%. The net impacts of foreign exchange rates and acquisitions and divestitures are expected to be a tailwind of approximately 1%. The company also maintained its outlook for organic sales growth in the range of in-line to up 4%.
“We are increasing investment in innovation and demand creation to improve value for consumers and drive category growth,” highlighted Moeller.
Shares of Procter & Gamble (PG) were up 2.6% in premarket trading. Church & Dwight (CHD), Clorox (CLX), and Colgate-Palmolive (CL) were all slightly higher as well in the early session. The ETFs with the highest weighting of P&G are the iShares US Consumer Staples ETF (IYK), the Vanguard Consumer Staples Index Fund ETF (VDC), and the Fidelity MSCI Consumer Staples Index ETF (FSTA).