Procter & Gamble Reports Q3 Financial Results with Decline in Net Sales but Increase in Net Earnings

The Procter & Gamble Company (P&G) reported its financial results for the third quarter and nine months ended March 31, 2025, revealing a slight decline in net sales but an increase in net earnings. For the quarter, P&G's net sales totaled $19.8 billion, a decrease of 2% from $20.2 billion in the same period last year. The decline was attributed to unfavorable foreign exchange rates and a 1% decrease in unit volume, which were partially offset by a 1% increase in pricing. In contrast, net earnings for the quarter remained stable at $3.8 billion, resulting in diluted earnings per share of $1.54, a 1% increase from the previous year.

For the nine-month period, P&G's net sales were $63.4 billion, down slightly by $112 million compared to the prior year. However, net earnings increased by 5% to $12.4 billion, driven by a prior year impairment charge of $1.3 billion on the Gillette intangible asset, which did not recur in the current period. The diluted earnings per share for the nine months rose to $5.03, reflecting a 6% increase. Core earnings per share, which exclude restructuring charges and the prior year impairment, also increased by 3% to $5.35.

P&G's operational performance showed mixed results across its business segments. The Health Care segment reported a 2% increase in net sales, while the Beauty segment experienced a 2% decline. The Fabric & Home Care segment's sales remained unchanged, and the Baby, Feminine & Family Care segment saw a 1% decrease. Notably, the Grooming segment's net sales were flat, but net earnings increased by 4% due to improved margins. The company also reported a 1% increase in organic sales for the nine-month period, indicating some resilience in its core business despite external challenges.

In terms of strategic developments, P&G has been undergoing a limited market portfolio restructuring, particularly in Argentina and Nigeria, to address challenging macroeconomic conditions. This restructuring has resulted in incremental charges of approximately $0.8 billion after tax. The company continues to focus on productivity improvements and cost savings, which have contributed to a decrease in selling, general, and administrative expenses as a percentage of net sales. P&G's operating cash flow for the nine months was reported at $12.8 billion, with adjusted free cash flow at $10.6 billion, reflecting strong cash generation capabilities.

Looking ahead, P&G anticipates continued challenges from foreign exchange fluctuations and commodity price volatility. The company remains committed to its long-term growth strategy, focusing on innovation and market share expansion across its diverse product categories. P&G's management expressed confidence in navigating the current economic landscape while maintaining its commitment to shareholder returns through dividends and share repurchases.