Newell Brands Inc. announced a global productivity plan that will eliminate more than 900 professional and clerical positions—roughly 10% of its non‑manufacturing workforce—through a series of layoffs and voluntary separations scheduled to begin in December 2025 and continue into 2026. The plan is part of the company’s broader turnaround strategy, which aims to streamline operations, reduce overhead, and free capital for innovation and brand growth.
The restructuring is expected to generate a pre‑tax charge of $75 million to $90 million, primarily for severance and related costs. Management projects that the plan will deliver annualized pre‑tax cost savings of $110 million to $130 million once fully implemented, a figure that represents a significant portion of the company’s operating expenses and will help improve its operating margin.
The announcement follows a challenging Q3 2025 earnings report in which Newell missed analyst expectations for both revenue and earnings per share. Net sales fell 7.2% to $1.81 billion, and normalized EPS was $0.17 versus the consensus estimate of $0.18. The miss was driven by slower‑than‑expected Latin American sales, unexpected retailer destocking, and a sharp slowdown in key international markets such as Brazil. Tariff costs, which rose to $180 million for 2025, also weighed on margins.
Segment performance was uneven. Home & Commercial Solutions core sales declined 9.8%, while Learning & Development core sales fell 5.6%. These declines contributed to the overall revenue shortfall, but the company’s core brands—such as Rubbermaid, Sharpie, and Yankee Candle—continued to generate steady demand in the U.S. market. The company’s CEO, Chris Peterson, emphasized that the productivity plan is a disciplined step to sharpen strategic focus and deliver stronger, more consistent performance.
Management highlighted that the cost savings will be reinvested in high‑return areas, including product development, marketing, and digital transformation. CFO Mark Erceg noted that the company is continuing to invest in innovation and brand building, with advertising and promotion spending at the highest rate in nearly a decade. The plan also aligns with Newell’s goal of improving operating margins and strengthening its balance sheet, which currently includes $4.8 billion of debt and $229 million in cash and equivalents.
The workforce reduction is expected to have a positive impact on Newell’s financial outlook. By cutting fixed costs, the company can improve its operating margin, which was 8.9% in Q3 2025 compared to 9.5% in the prior year period. The cost savings also provide flexibility to pursue growth opportunities and navigate ongoing headwinds such as tariff costs and market demand fluctuations.
Newell’s guidance for the remainder of 2025 reflects a cautious outlook. The company reaffirmed its Q4 normalized operating margin, normalized EPS, and operating cash flow guidance, but noted that Q4 net and core sales are expected to be toward the lower end of its previously communicated guidance range. The company’s full‑year 2025 guidance for normalized EPS remains below analyst expectations, underscoring management’s focus on cost discipline amid challenging market conditions.
Overall, the productivity plan represents a significant step in Newell’s turnaround strategy, aiming to stabilize earnings, improve margins, and position the company for future growth in a dynamic consumer environment.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.