P&G Trims Forecast, Citing a Rise in Costs

By the Editorial Team · Friday, October 23, 2026

Procter & Gamble reported a 4 percent increase in quarterly sales to $23.3 billion, driven by strong demand in its beauty and home care divisions, though rising raw material and freight costs are expected to reduce full-year profits by about $1.4 billion. Despite these challenges, the company remains confident in achieving its sales growth targets and continues to focus on innovation and productivity improvements amid ongoing restructuring efforts.

Procter & Gamble (P&G) reported a rise in quarterly sales driven by strong demand in its beauty and home care segments but cautioned that increasing costs for raw materials, energy, and freight would weigh on its full-year profits. The consumer goods company announced net sales of $23.3 billion for the three months ending in September, marking a 4 percent increase from the previous year and surpassing analysts’ expectations of $22.8 billion.

Volumes in P&G’s home care business, including brands such as Tide and Ariel, rose 4.3 percent, while the beauty division, which includes Pantene shampoo, saw a 2.2 percent volume increase. This growth was attributed in part to consumer willingness to spend on higher-priced hair-care products despite broader household pressures from rising fuel and food costs. Overall volume growth stood at 2.4 percent, supplemented by a modest price increase of around 0.4 percent. Operating income increased by 1 percent year-on-year to $5.9 billion. Following the announcement, P&G’s shares rose about 6 percent to $166.24 in midday trading on Nasdaq.

Despite this robust start to the fiscal year, P&G revised upward its forecast for cost pressures that would reduce fiscal 2027 profits by approximately $1.4 billion, up from a previous estimate of $1 billion. The company cited higher fuel prices as a key driver of transportation and freight cost increases, compounded by ongoing shortages of lorry drivers on certain routes, contributing to logistical challenges.

Shailesh Jejurikar, P&G’s chief executive, acknowledged ongoing geopolitical and economic uncertainties but expressed confidence that the company remains on track to meet its guidance for the year. On an earnings call, Chief Financial Officer Andre Schulten emphasized the increasingly competitive landscape, noting that future growth would depend more on expanding product categories rather than gaining market share.

P&G maintained its outlook for organic sales growth in the range of 1 to 3 percent for the full fiscal year. The company is in the midst of a two-year restructuring program that began the previous year, which includes a 15 percent reduction in non-manufacturing workforce, impacting up to 7,000 positions and contributing to costs during the recent quarter.

Analysts, including Filippo Falorni from Citi, indicated that while the company faces heightened cost challenges from oil and freight inflation, P&G’s financial guidance allows room to offset pressures through productivity improvements. The company also plans to continue investing in product innovation, focusing particularly on premium baby and laundry care segments. Notably, P&G’s operations in China exhibited their sixth consecutive quarter of strong growth, led by the exclusive Pampers Prestige brand.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.