Procter & Gamble’s first-quarter results exceeded expectations, with strong performance in beauty and shaving businesses; the company maintained its full-year outlook and lowered the impact of tariffs.

Procter & Gamble’s first-quarter results exceeded expectations, with strong performance in beauty and shaving businesses; the company maintained its full-year outlook and lowered the impact of tariffs.

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Thanks to increased demand for beauty and shaving products, Procter & Gamble’s first-quarter results exceeded Wall Street expectations. Although CEO Jon Moeller noted the “challenging consumer and geopolitical environment,” the company reaffirmed its full-year sales and profit forecasts.

For the quarter ended September 30, P&G reported adjusted earnings per share of $1.99, surpassing analysts’ estimates of $1.90; revenue was $22.39 billion, higher than the expected $22.18 billion. Organic sales rose 2%, exceeding market consensus. The strong results lifted the company’s shares up as much as 4% in premarket trading.

However, P&G’s sales figures show diverging demand. The health care and fabric and home care divisions saw sales volumes drop by 2%, while volume in baby, feminine, and family care remained flat. Beauty was the standout, with volumes up 4% and overall sales increasing by 6%. Shaving volumes grew by 1%, with sales up 5%.

The company lowered its expected costs from tariffs to $400 million (after tax) from the previous $800 million. However, on Thursday night, Trump said he would terminate all trade talks with Canada, potentially bringing new cost pressures for P&G.

Consumer Demand Shows “K-Shaped” Divergence

P&G CFO Andre Schulten said in a media call that the consumer environment “is not great but remains stable,” and shopper behavior has been similar for the past few quarters.

In P&G’s largest market, the US, overall category consumption has slowed. Similar to Coca-Cola, P&G observed a split in consumer purchasing behavior based on income levels, often described as a “K-shaped” economy.

Shoppers with more disposable cash buy bulk-pack goods from mass retailers and online channels. Schulten said: “That’s how they seek value.” Meanwhile, paycheck-to-paycheck American consumers stretch their money by using the last drop of detergent or shampoo before replenishing, and waiting until pantries are empty before buying more.

This split is reflected in performance data. Volumes in the fabric and home care division—which includes Tide and Swiffer—fell 2%, while baby, feminine, and family care—brands like Pampers and Tampax—remained flat.

Beauty and Shaving Businesses Drive Growth

The beauty segment was the best performer this quarter, with brands such as Olay and SK-II seeing volumes rise 4% and overall sales up 6%.

The shaving business also performed well, with product lines such as Gillette and Venus posting a 1% volume increase and 5% growth in sales. Strong demand for Gillette razors and Secret deodorant helped offset weakness in other categories.

These results reflect consumer resilience and suggest P&G’s strategy of charging premium prices while marketing its products as better than competitors is working. For example, the company’s Tide advertising claims its detergent keeps clothes stain-free longer, ultimately saving shoppers money.

Maintains Full-Year Guidance and Lowers Tariff Impact

P&G reaffirmed its fiscal 2026 forecast of 1%–5% sales growth and earnings per share of $6.83 to $7.09.

The company now expects Trump’s tariffs to result in $400 million in after-tax costs, down from a previous estimate of $800 million. P&G initially included retaliatory Canadian tariffs in its outlook, but these were later dropped. Thus, Moeller said on CNBC’s “Squawk Box” Friday morning the company plans for smaller than expected price hikes.

However, on Thursday night Trump announced he would terminate all trade talks with Canada in response to a TV ad, which could mean P&G faces higher costs in the future.

Apart from the baby, feminine, and family care unit, P&G raised prices across all business segments. Under pressure from rising economic costs, some consumers have started cutting back while seeking discounts and better value.

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