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(Bloomberg) — Kimberly-Clark Corp. has lowered profit expectations for the year, citing uncertainty arising from the impact on the global trade war on its costs.
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The Texas-based manufacturer of diapers and paper towels now sees flat to positive 2025 adjusted operating profit on a constant currency basis, instead of the high single-digit growth rate it forecast in January.
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“The current environment will now mean greater costs across our global supply chain versus our expectations at the beginning of the year,” Chief Executive Officer Mike Hsu said in a statement announcing first-quarter results.
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Hsu said he was confident the company would be able to “offset these costs over time” to drive profitability.
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In recent weeks, companies including Delta Air Lines Inc. and FedEx Corp. have lowered their profit guidance, prompted by uncertainty fanned by sweeping tariffs from the Trump administration.
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Kimberly-Clark, which sells its products under brands that include Kleenex and Huggies, says sales in the markets in which it competes are currently growing 1.5% to 2%, compared to the roughly 2% it saw at the start of the year. It expects its own sales this year to outpace the weighed average growth in these markets overall.
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First-quarter organic sales shrank 1.6%, falling short of the average estimate of a 1.4% expansion.
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Fewer than half of its suppliers are based in the US and the company manufactures in more 30 countries, including China, Mexico and Canada, data compiled by Bloomberg show.
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The weakening US dollar should offer some relief, with earnings per share negatively impacted by around 300 basis points from currency translation, compared to the previous expectation of a negative 350 basis points to 400 basis points impact.
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