10-K · August 4, 2026
P&G delivered modest reported growth in FY2026, with sales up 3% to $87.032 billion and diluted EPS up 2% to $6.62, but underlying organic sales grew only 1% and operating margin contracted 160 basis points to 22.7%.…
Earnings analysis · 10-Q
PG earnings analysis
Filed October 22, 2026 · Our reading of the company's report
The latest report
P&G delivered 4.0% year-over-year sales growth to $23.276 billion and 1% diluted EPS growth to $1.97, supported by 2.4% unit volume growth and strong $4.401 billion free cash flow. However, gross margin declined 160…
Read full summary
P&G delivered 4.0% year-over-year sales growth to $23.276 billion and 1% diluted EPS growth to $1.97, supported by 2.4% unit volume growth and strong $4.401 billion free cash flow. However, gross margin declined 160 basis points to 49.8% and operating margin declined 70 basis points to 25.5% amid commodity and product-investment costs, while net earnings fell 1%. Segment performance was mixed, with particularly strong Health Care earnings growth offset by declines in Beauty and Baby, Feminine & Family Care earnings. The filing reports no material changes to the risk factors from the June 30, 2026 Form 10-K.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $1.97
What stood out
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Sales grew 4.0% on volume and mix
Net sales increased 4.0% year over year to $23.276 billion, driven by 2.4% unit volume growth, 1.1% favorable geographic mix and 0.4% higher pricing. Organic sales also increased 4.0%.
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EPS and operating income increased
Diluted EPS rose 1% year over year to $1.97, while Core EPS increased 1% to $2.00. Operating income increased 1% to $5.937 billion despite lower gross margin.
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Strong cash generation
Free cash flow was $4.401 billion from $5.767 billion of operating cash flow and $1.366 billion of capital spending; free cash flow productivity was 93%.
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Fabric and Home Care led scale growth
Fabric & Home Care generated $8.205 billion of sales, up 4%, and $1.601 billion of net earnings, up 3%; its global market share increased 0.3 points.
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Health Care delivered earnings growth
Health Care sales increased 3% to $3.318 billion, while net earnings rose 9% to $783 million, supported by a 200-basis-point gross-margin increase and a 130-basis-point net-earnings-margin increase.
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Working-capital cash flow remained positive
Operating cash flow increased $359 million year over year to $5.767 billion. Trade payables generated $1.1 billion of cash, more than offsetting $589 million consumed by receivables and $349 million consumed by inventories.
What to watch
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Commodity costs pressured margins
Gross margin fell 160 basis points year over year to 49.8%, primarily reflecting 140 basis points of higher commodity costs and 140 basis points of product and packaging investments. Operating margin declined 70 basis points to 25.5%.
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Profit growth lagged sales growth
Net earnings declined 1% to $4.757 billion despite 4.0% sales growth. Beauty net earnings fell 1% to $868 million and Baby, Feminine & Family Care net earnings fell 4% to $1.060 billion.
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Leverage and liquidity exposure
Current liabilities exceeded current assets by $12.5 billion as of September 30, 2026. Financing activities generated $1.1 billion of cash, mainly from a net debt increase related to the $3.9 billion all-cash Thorne acquisition.
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Restructuring execution remains material
The company expects approximately $2.0 billion of before-tax restructuring costs over two years, with the remainder expected in fiscal 2027, alongside a reduction of up to 7,000 non-manufacturing overhead personnel by the end of fiscal 2027.
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Volume declines in key categories
Health Care unit volume declined 2.9%, including declines in Latin America and Greater China, while Baby, Feminine & Family Care unit volume increased 2.3% but net earnings declined 4%.
Management's outlook
The 10-Q does not provide quantitative revenue or EPS guidance ranges. It states that approximately $2.0 billion of before-tax restructuring costs are expected over two years, with the remainder expected in fiscal 2027, and that approximately $5.0 billion of fiscal 2027 share repurchases are expected.
Earlier filings 4
10-Q · April 24, 2026
Procter & Gamble reported Q3 net sales of $21,235 million (up 7% YoY) and diluted EPS of $1.63 (up 6% YoY). Gross margin compressed 150 basis points to 49.5% and operating margin compressed 150 basis points to 21.5% as…
10-Q · January 23, 2026
P&G reported net sales of $22,208 million for the quarter ended December 31, 2025, up $326 million (+1.5%) versus the prior-year quarter, while diluted EPS declined to $1.78 from $1.88 a year ago. Gross margin…
10-Q · October 24, 2025
Procter & Gamble reported net sales of $22,386 million and diluted EPS of $1.95 for the three months ended September 30, 2025, beating revenue and EPS estimates. Revenue rose $649 million (3.0%) and EPS rose $0.34…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.