Procter & Gamble gains after organic sales top expectations in a ‘volatile’ environment

Procter & Gamble (NYSE:PG) gained in early trading on Tuesday after the household products giant beat FQ4 earnings estimates. “We grew sales and profit in fiscal 2025 and returned high levels of cash to shareowners in a dynamic, difficult and volatile environment,” noted CEO Jon Moeller.

Organic sales increased 2% in FQ4 to edge past the consensus estimate of +1.8%.

Beauty segment organic sales increased 1% in comparison to a year ago. Hair care organic sales were unchanged as innovation-driven growth in Latin America and Europe was offset by volume declines in North America and Greater China. Grooming segment organic sales increased 1% versus a year ago, driven by innovation-based pricing, partially offset by an appliance volume decline. Baby, Feminine and Family Care segment organic sales increased 1% versus a year ago. Health Care segment organic sales increased 2% versus a year ago. Oral Care organic sales increased low single digits, driven by product mix from premium innovation.

The Cincinnati-based company reported core gross margin for the quarter decreased 70 basis points from a year ago, and on a currency-neutral basis decreased 50 basis points. The decrease was driven by 150 basis points of unfavorable product mix, 70 basis points of product/package reinvestments, 40 basis points of higher commodity costs, 40 basis points of higher costs from tariffs and 40 basis points of other miscellaneous items and rounding. Those were partially offset by 240 basis points of productivity savings and 50 basis points of pricing benefit.

Looking ahead, P&G now expects 2026 organic sales growth of 0% to +4% (+2% midpoint) vs. +2.6% consensus. Included in the organic sales forecast is a growth headwind of 30 to 50 basis points from brand and product form discontinuations. P&G expects fiscal 2026 diluted net earnings per share growth in the range of 3% to 9% versus fiscal 2025 GAAP EPS of $6.51. The outlook equates to a range of $6.83 to $7.09 per share vs $7.00 consensus, with a mid-point estimate of $6.96, or an increase of 2%.

“We’ve put in place strong plans to continue to deliver for all stakeholders in the current environment. In fiscal 2026, we expect to deliver another year of organic sales growth, Core EPS growth and strong adjusted free cash flow productivity,” highlighted Moeller.

Shares of P&G were up 0.9% in premarket trading. Church & Dwight (CHD), Clorox (CLX), and Colgate-Palmolive (CL) were all slightly higher as well in the early session.

Earlier in the morning, the company announced that COO and long-time executive Shailesh Jejurikar will replace current CEO Jon Moeller as chief executive of the company, effective January 1, 2026.