Kenvue posted a fourth consecutive quarter of net and organic sales growth, with higher margins and earnings in the fiscal third quarter ended Sept. 27. The consumer-health company said sales gains came from both higher volume and improved value realization, while productivity savings helped lift profitability.
The results come as Kenvue and Kimberly-Clark approach completion of their pending combination, according to Kenvue CEO Kirk Perry. Kenvue said it will not provide forward-looking guidance while the transaction is pending.
Key details
- Sales grew: Net sales rose 3.2% from a year earlier. Organic sales, which exclude currency effects, increased 2.9%; foreign exchange added 0.3 percentage points.
- Volume and pricing both contributed: Organic growth reflected a 1.6% increase in volume and 1.3% from favorable value realization.
- Margins expanded: Gross profit margin increased to 59.5% from 59.1%; adjusted gross margin rose to 61.5% from 61.2%.
- Operating profitability improved more sharply: Operating income margin climbed to 18.2% from 16.7%. Adjusted operating income margin increased to 21.9% from 21.5%.
- Earnings per share rose: Diluted earnings per share were 22 cents, up from 21 cents. Adjusted diluted earnings per share increased to 29 cents from 28 cents.
- Cost savings supported margins: Kenvue cited global supply-chain productivity gains, U.S. tariff refunds and favorable value realization as contributors to gross-margin improvement. Inflation and unfavorable transactional foreign exchange partly offset those benefits. Operating-margin gains also reflected cost-reduction efforts, including the 2026 Restructuring Initiative and Our Vue Forward.
- Management pointed to continued execution: Perry said results reflected productivity initiatives and investment in Kenvue’s brands and innovation, and described the company as on track with a business transformation begun last year. He also cited strong cash generation but did not provide a figure in the results announcement.
- Combination with Kimberly-Clark remains pending: Perry said the companies were nearing completion of their combination. Kenvue did not provide transaction terms or a completion date in this results announcement.
What changes for investors
The quarter showed year-over-year growth in sales, margins and earnings, with volume contributing alongside value realization and cost savings. Kenvue’s decision to suspend forward guidance means the company is not providing its usual outlook while the Kimberly-Clark transaction is pending.