P&G grows in fiscal Q4 with higher organic sales and earnings per share

Procter & Gamble (P&G) reported a 2% increase in organic sales and a 17% rise in diluted earnings per share (EPS) for the fourth quarter of fiscal year 2025, ended in June. The results were driven by higher pricing and a favorable product mix. Net sales for the quarter totaled $20.9 billion, and core EPS rose 6%. Operating cash flow reached $5 billion, while core operating margin expanded by 150 basis points, reflecting strong productivity gains.

SEGMENT PERFORMANCE

Beauty: Organic sales rose 1%. In Hair Care, results were flat, as growth in Latin America and Europe offset volume declines in North America and China. Personal Care posted low-single-digit growth, supported by volume gains in North America. Skin Care remained flat, with growth in Greater China offset by declines in the U.S. and unfavorable mix.

Grooming: Organic sales were up 1%, supported by innovation-driven pricing, though volume declined in appliances and devices.

Health Care: The segment saw a 2% increase in organic sales. Oral Care grew modestly thanks to product mix benefits from premium innovations. Personal Health Care also posted low-single-digit growth, with pricing gains offset by lower volume due to a mild cough and cold season in North America.

Fabric and Home Care: Organic sales grew 1%. Fabric Care was driven by innovation and strong performance in North America. Home Care posted modest growth due to volume increases in North America and Europe.

Baby, Feminine and Family Care: The segment posted a 1% increase in organic sales. Feminine Care stood out with higher pricing and favorable mix. Family Care (tissue products) also saw growth, mainly from volume gains. Baby Care declined slightly, due to volume losses in North America.

STRATEGY AND RESTRUCTURING

P&G reaffirmed its commitment to a focused portfolio of high-performing, daily-use categories supported by consistent productivity improvements and strategic reinvestment. Core operating margin rose 150 basis points in the quarter, with 560 basis points in productivity savings, offsetting headwinds from mix, commodity costs, tariffs and reinvestments.

The company completed its limited market portfolio restructuring in emerging markets, including the substantial liquidation of operations in Argentina and adjustments in Nigeria. As part of its global competitiveness strategy, P&G plans to eliminate up to 7,000 non-manufacturing roles by the end of fiscal 2027, with half of related costs expected by the end of fiscal 2026.

FISCAL YEAR 2026 OUTLOOK

For fiscal 2026, P&G expects total sales growth between 1% and 5%, with organic sales growth between 0% and 4%, despite some brand and product form discontinuations. Core EPS is projected to range from $6.83 to $7.09, with a midpoint estimate of $6.96 — up 2% from fiscal 2025.

The company anticipates a $0.39 per share headwind from commodity costs, tariffs and interest expenses, partially offset by favorable foreign exchange effects. Still, P&G expects strong cash flow productivity, planning to return value to shareholders with $10 billion in dividends and $5 billion in share repurchases over the next fiscal year.