Clorox Reports 8% Decline in Q3 Sales, Net Income Recovery to $186 Million

The Clorox Company reported a decline in financial performance for the third quarter of fiscal year 2025, with net sales of $1.668 billion, an 8% decrease from $1.814 billion in the same period last year. For the nine months ending March 31, 2025, net sales totaled $5.116 billion, down 1% from $5.190 billion in the prior year. The decrease in revenue was primarily attributed to the divestitures of the Better Health Vitamins, Minerals, and Supplements (VMS) business and the Argentina business, which impacted both sales and volume. Despite the decline in sales, the company reported a net income of $186 million for the quarter, a significant recovery from a loss of $51 million in the same quarter of the previous year.

The company's gross profit for the third quarter was $744 million, down from $766 million a year earlier, but the gross margin improved to 44.6%, up from 42.2%. This increase was driven by cost savings and the benefits from the divestitures. Selling and administrative expenses decreased by 11% to $267 million, reflecting lower incentive compensation and the impact of divestitures. Advertising costs increased slightly, while research and development expenses decreased, indicating a continued focus on cost management.

In terms of strategic developments, Clorox completed the divestiture of its Better Health VMS business in September 2024, which was part of its strategy to streamline operations and improve margins. The company also faced challenges from a cyberattack in August 2023, which had previously disrupted operations but has since been resolved. The company recorded insurance recoveries related to this incident, contributing positively to its financial results in the current quarter.

Operationally, Clorox's workforce remained stable with approximately 7,400 employees across 25 countries. The company continues to invest in its brands and capabilities, aiming for consistent, profitable growth. The divestitures are expected to reduce volatility and enhance margins, aligning with the company's long-term strategic goals. Looking ahead, Clorox anticipates ongoing challenges from macroeconomic conditions, including inflation and supply chain disruptions, but remains committed to driving growth and improving operational efficiency. The company has also entered into a new $1.2 billion revolving credit agreement, enhancing its liquidity position as it navigates these challenges.