Procter & Gamble tops earnings, revenue estimates even as higher prices drive some consumers away (2024)

In this article

Procter & Gamble on Wednesday reported quarterly earnings and revenue that topped analysts' expectations, despite volume falling for the sixth consecutive quarter.

Shares of the company closed trading on Wednesday up 2.58% on the report.

Here's what P&G reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG, formerly known as Refinitiv:

  • Earnings per share: $1.83 vs. $1.72 expected
  • Revenue: $21.87 billion vs. $21.58 billion expected

P&G reported fiscal first-quarter net income attributable to the company of $4.52 billion, or $1.83 per share, up from $3.94 billion, or $1.57 per share, a year earlier.

Net sales rose 6% to $21.87 billion. The company's organic revenue increased 7% in the quarter, helped by higher prices for P&G's products.

But the company's volume shrank 1%. The metric excludes the impact of currency and pricing changes to reflect demand.

For roughly two years, P&G has been raising prices on its products like Tide detergent and Charmin toilet paper.

"For obvious reasons we don't comment on the future direction of pricing, but I will tell you that we're happy with where we sit currently," CEO Jon Moeller said Wednesday on CNBC's "Squawk Box."

|Jim Cramer's Investing Club shares what investors should listen for in a company'searningscall

P&G hasn't gotten any pushback from retailers about its higher prices, beyond "normal discussions" about maximizing customer value, CFO Andre Schulten told analysts on the company's conference call.

But some consumers aren't happy with P&G's higher prices. Some shoppers have switched to cheaper private-label alternatives as a result, and P&G said it saw "pricing-related volume declines" across many of its brands. However, its volume declines have narrowed in recent quarters, and the company expects to report volume growth for the fiscal year.

The company's baby, feminine and family care segment reported its volume fell 3%. The division includes brands like Pampers and Bounty.

P&G's grooming segment, which includes Venus and Gillette products, reported a 2% drop in volume.

The company's fabric and home-care business saw its volume shrink 1%, even as customers bought more of its premium cleaning products, which include Swiffer and Cascade.

P&G's health-care division was the only segment to report volume growth for the quarter. The company said it saw strong demand for respiratory products, like those made by Vicks.

The company also widened its outlook for fiscal 2024 revenue as it anticipates that foreign exchange rates could be a larger drag than previously expected. The company now projects revenue growth of 2% to 4%, rather than its prior forecast of 3% to 4%.

P&G reiterated its full-year forecast for organic revenue growth, which strips out the impact of acquisitions, divestitures and foreign currency, and for earnings per share growth. But Schulten warned about economic conditions that could weaken performance, like rising energy costs heading into the winter, lower household savings rates and the health of the Chinese market.

Don't miss these CNBC PRO stories:

Procter & Gamble tops earnings, revenue estimates even as higher prices drive some consumers away (2024)


What is the revenue forecast for P&G? ›

Analysts expect P&G to report $20.45 billion in revenue for its 2024 fiscal third quarter ended in March, 1.9% better than the same quarter in the year prior, according to data compiled by Visible Alpha. It would be the lowest revenue growth for the company in the past five quarters.

How has inflation affected P&G? ›

It turns out Procter & Gamble, the company which makes household staples like Tide detergent, Bounty paper towels, and Crest toothpaste, made more money last quarter because it raised prices on its household items, showing that even with inflation, people are still buying the company's higher-priced products.

What is the price prediction for Procter and Gamble? ›

Stock Price Forecast

The 17 analysts with 12-month price forecasts for Procter & Gamble stock have an average target of 169.88, with a low estimate of 153 and a high estimate of 185. The average target predicts an increase of 2.31% from the current stock price of 166.04.

What did P&G do to improve their revenue? ›

Elevating prices was the cornerstone of their revenue ascent. 2. Margin Makeover: P&G's gross margin underwent a transformation, fueled by the surge in product prices and shrewd cost-saving manoeuvres.

Is P&G Stock Overvalued? ›

The intrinsic value of one PG stock under the Base Case scenario is 119.11 USD. Compared to the current market price of 166.04 USD, Procter & Gamble Co is Overvalued by 28%.

Is P&G a good investment? ›

P&G currently has an average brokerage recommendation (ABR) of 1.61, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 22 brokerage firms. An ABR of 1.61 approximates between Strong Buy and Buy.

Why is Procter and Gamble raising prices? ›

One reason P&G continues to raise prices for consumers is that the company is feeling the pinch of inflation, too. While higher prices benefited its gross profit margin last quarter by 470 basis points, much of that was offset by higher input expenses.

What are the threats to P&G? ›

Threats. Intense Competition and Market Saturation: The consumer goods industry is highly competitive, with PG facing competition from both global brands and local players. Market saturation in certain segments could lead to price wars and margin compression, challenging PG's profitability and market share.

What risk will P&G face in the future? ›

P&G lists supply chain disruptions, regulatory changes, reputational perception, and changing consumer preferences as risk factors in its 2019 10-K. These risk factors are all exacerbated by exposure to deforestation and forest degradation.

Who is P&G owned by? ›

Vanguard owns the most shares of Procter & Gamble (PG). The ownership structure can impact the company's decision making, as large institutional investors may exert influence on the company's management and can also affect the company's stock price with their buying and selling patterns.

Who is the largest shareholder of P&G? ›

Among individuals, the largest shareholders are company executives and board members, who receive the stock in compensation. David Taylor is the largest shareholder of PG stock, with over 12 million common shares. On Nov. 1, 2021, Jon Moeller will succeed David Taylor to become President and CEO of Procter & Gamble.

Is P&G an Israeli company? ›

The Procter & Gamble Company (P&G) is an American multinational consumer goods corporation headquartered in Cincinnati, Ohio, founded in 1837 by William Procter and James Gamble.

What are the pros and cons of Procter and Gamble? ›

Procter & Gamble: Pros And Cons
  • Pros: Divesting brands, strong management, long-time dividend growth.
  • Cons: Strong dollar, slowing EPS growth, high valuation, higher interest rates.
  • Strong case for holding off on a new position.
Jun 19, 2015

Why is P&G so successful? ›

P&G has a dominant presence in a number of consumer goods markets. Their brands, such as Tide, Pampers, and Gillette, have significant market share and client devotion. P&G's competitive edge is based on its excellent R&D capabilities, efficient supply chain, and effective marketing methods.

What strategy does Procter and Gamble use? ›

We remain committed to our strategy — a focus on daily use categories where performance drives brand choice, superiority (of product, package, communication, go-to-market execution and value), productivity, constructive disruption, and an agile and accountable organization structure and culture — all in pursuit of ...

What is P&G revenue in 2024? ›

CINCINNATI--(BUSINESS WIRE)-- The Procter & Gamble Company (NYSE:PG) reported third quarter fiscal year 2024 net sales of $20.2 billion, an increase of one percent versus the prior year. Organic sales, which excludes the impacts of foreign exchange and acquisitions and divestitures, increased three percent.

What is the 5 year forecast for Procter and Gamble stock? ›

Procter & Gamble stock price stood at $165.07

According to the latest long-term forecast, Procter & Gamble price will hit $200 by the end of 2026 and then $250 by the middle of 2029. Procter & Gamble will rise to $300 within the year of 2030 and $350 in 2034.

What is the future growth of Procter and Gamble? ›

Future Growth

Procter & Gamble is forecast to grow earnings and revenue by 7.2% and 3.6% per annum respectively. EPS is expected to grow by 7.5% per annum. Return on equity is forecast to be 33.8% in 3 years.

What is the growth rate of P&G sales? ›

Value from Last Quarter4.00%
Change from Last Quarter-25.00%
Value from 1 Year Ago7.00%
Change from 1 Year Ago-57.14%
2 more rows


Top Articles
Latest Posts
Article information

Author: Duane Harber

Last Updated:

Views: 5367

Rating: 4 / 5 (71 voted)

Reviews: 86% of readers found this page helpful

Author information

Name: Duane Harber

Birthday: 1999-10-17

Address: Apt. 404 9899 Magnolia Roads, Port Royceville, ID 78186

Phone: +186911129794335

Job: Human Hospitality Planner

Hobby: Listening to music, Orienteering, Knapping, Dance, Mountain biking, Fishing, Pottery

Introduction: My name is Duane Harber, I am a modern, clever, handsome, fair, agreeable, inexpensive, beautiful person who loves writing and wants to share my knowledge and understanding with you.