Procter & Gamble Earnings Beat Estimates. This Warning Is Pressuring the Stock. -- Barrons.com

By Kit Norton

Shares of Procter Gamble declined in premarket trading Wednesday as Wall Street reacted to mixed quarterly earnings and underwhelming profit guidance from the consumer packaged goods company.

Procter Gamble posted core earnings of $1.43 a share for the fiscal fourth quarter, down from $1.48 a year ago but slightly above Wall Street expectations of $1.41. Net sales grew 2% to $21.2 billion, missing the consensus call for $21.38 billion, according to FactSet.

It was a mixed bag for Procter Gamble's product categories -- which range from baby care to hair care. For the quarter, from April to June, the beauty business saw 4% organic sales growth, but other segments were either flat from last year or slightly lower.

Looking ahead, the company expects fiscal 2027 core earnings of $6.89 to $7.11 a share with sales growing between 1% and 3%. Wall Street forecasts fiscal 2027 earnings of $7.02 a share with sales growing 2.7%, according to FactSet. The guidance for fiscal 2027 at the midpoint of $7 a share slightly misses Wall Street's consensus view.

The company also warned that it will face an estimated headwind of about $1 billion due to higher raw materials, energy, and transportation costs in fiscal 2027. Procter Gamble expects total impacts to equate to a headwind of 56 cent a share for fiscal 2027 -- which represents an 8% drag on core earnings growth.

Procter Gamble stock declined 2.8% to $144.70 in premarket trading on Wednesday after ending Tuesday up about 0.2%. Shares have been in a holding pattern this year, gaining about 4%.

CEO Shailesh Jejurikar said in the earnings release that the company experienced a "challenging geopolitical and economic environment" in fiscal 2026 and there will be "continued volatility" in fiscal 2027.

"We are confident in our plans to accelerate growth from semester-to-semester, and our investments will be funded with a strong productivity program. We are building momentum with consumers, and we are excited about the long-term opportunities ahead," Jejurikar said.

Write to Kit Norton at kit.norton@barrons.com

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July 29, 2026 08:09 ET (12:09 GMT)