Newell Brands reported a second consecutive quarter of year-over-year sales growth, with growth across both U.S. and international markets. The consumer-products company also raised its full-year sales outlook, while holding to the midpoints of its outlook for adjusted operating margin and adjusted earnings per share.
The quarter showed improvement in sales and adjusted profitability, though reported operating margin fell sharply from a year earlier.
Key details
- Sales rose: Third-quarter net sales were $1.9 billion, up 3.7% year over year. Core sales, which exclude certain items, increased 3.3%.
- Growth was broad-based: Both U.S. and international businesses grew. Four of Newell’s six businesses and seven of its 10 largest brands also posted growth.
- Adjusted margins improved: Normalized gross margin increased to 35.2% from 34.5% a year earlier, while normalized operating margin rose to 9.8% from 8.9%. The company said stronger sales and productivity efforts supported the improvement, despite inflation running higher than expected.
- Reported operating margin declined: Operating margin was 1.4%, compared with 6.6% in the year-earlier quarter. This contrasts with the increase in normalized operating margin; the figures reflect different measures, and the release did not provide the reconciliation in the material presented here.
- Sales outlook increased: Newell now expects positive sales growth for both the fourth quarter and full year 2026. It attributed the change to its third-quarter results and improvements in areas including consumer understanding, brand investment, innovation and marketing.
- Other outlook midpoints held: The company maintained the midpoints of its full-year normalized operating-margin and normalized earnings-per-share outlooks. It said higher expected sales and further cost-containment efforts offset the effect of higher-than-expected inflation.
- Debt reduction remains a priority: Newell expects to reduce total debt and factoring by a couple hundred million dollars this year.
What changes for investors: The sales outlook is stronger, but the company did not raise its normalized margin or earnings outlook midpoints. Its reported operating margin also moved lower even as the adjusted measure improved, making the distinction between the two measures important when assessing the quarter.