Kimberly-Clark expects US$300 million tariff impact but keeps investments and prices steady
Company chooses to preserve strategic plan and innovation despite rising costs from U.S. tariffs on Chinese products
Kimberly-Clark is anticipating a significant increase in costs in 2025 due to newly imposed U.S. tariffs on Chinese imports. The company estimates an additional US$300 million in expenses, prompting a revision of its profit forecast, which is now expected to remain flat for the year.
Despite this more challenging outlook, the company does not intend to raise product prices or scale back investment plans. According to executives, the strategy to offset the impact involves shifting sourcing to reduce exposure to tariffs and preserve market competitiveness.
The company reports that approximately 80% of its cost structure is U.S. -based, leaving only 20% exposed to the new tariffs. Most of the projected financial impact stems from the recent package of tariffs targeting Chinese goods.
“We’re working fast through actions to mitigate these costs, and frankly, the learnings that we had in the ’21, ’22, ’23 cycle have come in pretty handy”, said CFO Nelson Urdaneta. He emphasized that the decision to maintain pricing is tied to the need to remain competitive against peers with more localized production.
Additionally, Kimberly-Clark is maintaining its innovation and transformation agenda. In 2024, the company launched the “Powering Care” program, aimed at restructuring the organization to accelerate the development and delivery of new products. Despite increased costs, the plan remains on track, with no cuts expected in strategic initiatives.
“Overall, I would say there’s no impact to the long-term strategy”, Urdaneta stated.
