P&G Shares Rise on Outlook for Faster Pace of Sales This Year

Procter & Gamble expects organic sales growth this year to range between flat to up 4% versus the prior year. Photo by David Paul Morris /Bloomberg

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(Bloomberg) — Procter & Gamble Co. issued a wide range for its annual sales outlook, underscoring the volatility that US companies continue to navigate even as the Trump administration begins to strike trade deals with other countries.

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The maker of Tide detergent and Gillette razors expects organic sales growth this year to range between flat to up 4% versus the prior year, the company said Tuesday in a statement. 

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The top end of that range would be a faster pace of growth than the most recent fiscal year, which ended on June 30, and better than Wall Street’s forecast for 2.6% organic annual sales growth, according to a Bloomberg survey. Shares rose nearly 1% in premarket trading.

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It will be up to Shailesh Jejurikar to try to meet those targets. P&G said on Monday that it’s promoting the 58-year-old from chief operating officer to CEO. The longtime P&G executive will replace Jon Moeller, who’s held the top job for around four years, on Jan. 1.

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When asked about the timing of the CEO transition, Moeller said in an interview on Monday that he’s been at P&G for nearly four decades.

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Jejurikar “has helped craft the firm’s strategic playbook (centered on stringently extracting costs while directing additional resources toward product innovation that resonates with consumers and marketing that fare),” Morningstar analyst Erin Lash wrote in a research note. “We don’t expect it to pivot off its current course.” 

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Price Increases

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P&G is increasing prices by a mid-single-digit percentage on around one-quarter of its products in the US and Canada this quarter, Chief Financial Officer Andre Schulten said during a separate interview. The company had previously said it planned to raise prices to counter tariff costs. 

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The consumer goods behemoth said on Tuesday that it expects around $1 billion in higher costs from tariffs before taxes in the current fiscal year – a figure that’s at the lower end of its previous guidance. 

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In addition to raising prices, P&G executives are working to counter those higher costs by increasing productivity at the company, shifting where it sources goods from and changing formulations. It’s raising prices on products with ingredients that can’t be sourced locally.  

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The company is trying to improve the products it’s increasing prices on. “The consumer is under pressure,” Schulten said. “It’s critical for us to provide better value.”

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P&G issued the same guidance range for its earnings per share: flat to up 4%, which would equate to a mid-point estimate of $6.96. That’s slightly below the $6.99 per share that analysts surveyed by Bloomberg are forecasting for the current fiscal year, which ends in June 2026. 

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Although tariffs and economic uncertainty – particularly in its most profitable market, the US – are clouding the outlook for P&G and other major companies, analysts say the conglomerate has the breadth of brands and the financial strength to navigate the challenges better than most.