P&G Stock Ticks Up on Earnings. Why Tariffs Are Still a Factor to Watch.

The consumer products company said tariff costs will be $400 million in fiscal 2026. (Daniel Acker/Bloomberg)

Key Points

• Procter & Gamble’s fiscal first-quarter core earnings of $1.99 a share exceed analysts’ estimates.
• Sales for the quarter reach $22.4 billion, surpassing Wall Street’s $20.9 billion forecast and increasing 3% year over year.
• The company maintains its fiscal 2026 sales growth outlook of 1% to 5% and core earnings per share of $6.83 to $7.09.

Shares of Procter & Gamble ticked up Friday after the maker of consumer products reported better-than-expected quarterly earnings.

The company posted core earnings of $1.99 a share for its fiscal first quarter, surpassing analysts’ consensus estimates of $1.90. Sales totaled $22.4 billion, above Wall Street’s call for $20.9 billion and up 3% from the prior year.

The company’s beauty and grooming segments, which include brands like Head & Shoulders and Gillette, drove the solid results. Organic sales for those businesses rose 6% and 3%, respectively.

P&G stock rose 0.7% to $152.26 on Friday. Shares had fallen 9.8% this year as of Thursday’s close.

“These results keep us on track to deliver within our guidance ranges on all key financial metrics for the fiscal year in a challenging consumer and geopolitical environment,” said CEO Jon Moeller in a statement.

P&G now expects to incur costs from tariffs of around $400 million after tax in fiscal 2026, down from a previous estimate of $800 million. The company also reiterated its fiscal 2026 outlook for sales growth of between 1% and 5% and for core per-share earnings of $6.83 to $7.09.

Factors like supply-chain investments and adjustments in pricing plans will offset some of the improvement in isolated tariff impacts, P&G Chief Financial Officer Andre Schulten said on a conference call Friday.

Tariffs took a slice out of P&G’s profit in the first quarter. The company’s gross margin fell to 51.4% from 52.1% the prior year. While tariffs weren’t the only factor weighing on profit, P&G’s gross margin would have been flat without higher costs from tariffs and commodity prices.

Write to Nate Wolf at nate.wolf@barrons.com