Clorox reported first‑quarter fiscal 2026 results for the quarter ended September 30 2025. Net sales fell 19% year‑over‑year to $1.43 billion, driven by an 18‑point decline in volume and a one‑point unfavorable price mix.
Diluted earnings per share were $0.65, while adjusted EPS stood at $0.85. Management estimated that the U.S. ERP transition inventory drawdown would reduce FY2026 diluted EPS by about $0.90, reflecting a 30% year‑over‑year decline in earnings per share.
Gross margin contracted to 41.7% in Q1 FY2026, a decline of 410 basis points from 45.8% in the prior‑year quarter. The contraction was largely due to lower volume and higher manufacturing and logistics costs associated with the ERP transition.
In Q1 FY2025, Clorox posted net sales of $1.76 billion, diluted EPS of $0.80, and adjusted EPS of $1.86, underscoring the sharp year‑over‑year decline in the current quarter.
All business segments recorded net sales declines, with the Lifestyle segment experiencing the largest drop at 23%. The company cited value‑seeking consumer behavior and competitive pressures as contributing factors.
Clorox reaffirmed its adjusted earnings per share guidance for fiscal 2026 at $5.95 to $6.30. However, the company now expects net sales to be down 6% to 10% and organic sales to decline 5% to 9% for the year, reflecting ongoing order fulfillment challenges.
Management highlighted that the ERP rollout is a key component of its IGNITE transformation strategy, aimed at boosting productivity and reducing administrative costs. The transition, which cost an estimated $560 million to $580 million, is expected to deliver long‑term operational efficiencies.
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