Procter & Gamble reported fiscal first-quarter 2025 net sales of $21.7 billion, a 1% decrease compared to the prior year, missing Wall Street expectations. Organic sales, which exclude foreign exchange and acquisitions/divestitures, increased by 2%, driven by higher pricing and a 1% increase in organic volume. Diluted net earnings per share were $1.61, down 12%, while core earnings per share rose 5% to $1.93.
The company's performance was significantly impacted by a 15% organic sales decline in Greater China, its second-largest market, with volume decreases in hair care and oral care. The Beauty segment saw a 2% volume fall, and skin care organic sales tumbled over 20% due to the SK-II brand and anti-Japanese sentiment. Baby care organic sales also declined by mid-single digits.
Despite these challenges, P&G maintained its fiscal 2025 guidance, projecting all-in sales growth of 2% to 4% and organic sales growth of 3% to 5%. Core earnings per share are still expected to grow between 5% and 7%, translating to a range of $6.91 to $7.05 per share. The company anticipates a $200 million after-tax commodity cost headwind for the fiscal year.
P&G generated $4.3 billion in operating cash flow and achieved an adjusted free cash flow productivity of 82% for the quarter. The company returned nearly $4.4 billion to shareholders, comprising over $2.4 billion in dividend payments and over $1.9 billion in share repurchases, demonstrating its commitment to shareholder value despite market volatility.
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