Prime Highlights:
Procter & Gamble exceeded Wall Street estimates for both earnings and revenue in its fiscal second-quarter results.
Net income rose to $4.63 billion ($1.88 per share), up from $3.47 billion ($1.40 per share) a year ago. Revenue increased 2% to $21.88 billion, surpassing expectations of $21.54 billion.
P&G’s volume grew by 1%, driven by higher demand for household essentials such as toilet paper and cleaning products.
Key Background:
Procter & Gamble (P&G) surpassed Wall Street expectations for both earnings and revenue in its fiscal second-quarter results, benefiting from higher demand for household essentials such as toilet paper and cleaning products. The company reported a 1% increase in volume during the quarter, driven by stronger sales in its two largest markets, the U.S. and China. As a result, P&G’s shares rose by more than 3% in morning trading on January 22.
For the quarter ending December 31, P&G’s net income reached $4.63 billion, or $1.88 per share, compared to $3.47 billion, or $1.40 per share, in the same period last year. Revenue increased by 2% to $21.88 billion, surpassing analysts’ expectations of $21.54 billion. The company’s organic revenue, which excludes currency fluctuations and divestments, grew by 3%, driven by improved performance in Greater China, where organic sales fell just 3% compared to a 15% decline in the previous quarter.
Despite facing challenges such as a U.S. port strike, Hurricane Milton, and a two-week global transportation outage, P&G’s overall volume grew by 1%. Chief Financial Officer Andre Schulten noted that the U.S. consumer remained volatile, as many shoppers stocked up on household staples ahead of the October port strike and replenished their stock in December. However, excluding these disruptions, the U.S. and European markets remained relatively stable.
The company’s baby, feminine, and family care division saw the highest volume growth, with a 4% increase, thanks to strong sales of Charmin, Puffs, and Tampax products. Conversely, P&G’s beauty division faced a decline in volume, driven by reduced demand for hair care products in Greater China and a global drop in sales of Olay skin-care items. Looking ahead, P&G reiterated its fiscal 2025 guidance, forecasting core net earnings per share between $6.91 and $7.05, with revenue growth expected to range from 2% to 4%.
