CLX

It has been about a month since the last earnings report for Clorox (CLX). Shares have lost about 9.3% in that time frame, underperforming the S&P 500. But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Clorox due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers. Clorox delivered mixed fourth-quarter fiscal 2026 results, with the top and bottom lines surpassing the Zacks Consensus Estimate. However, sales and earnings per share declined year over year due to unfavorable comparison with ERP-related shipments in the prior-year quarter, lower volume and significant gross margin pressure from higher commodity, manufacturing and logistics costs. Clorox posted adjusted earnings of $1.66 per share for the fourth quarter of fiscal 2026, falling 42% year over year but beating the Zacks Consensus Estimate of $1.64 by 1.2%. Lower sales and gross margin weighed on the bottom line.Net sales declined 2% to $1.95 billion but surpassed the consensus mark of $1.91 billion by 1.8%. The GOJO acquisition contributed about 10 percentage points to sales, while organic sales fell 13% due mainly to the ERP-related shipment comparison. Gross profit declined 13% to $804 million from $924 million a year ago. The gross margin declined 520 basis points (bps) year over year to 41.3%. Lower volume, GOJO inventory step-up costs, higher commodity expenses, and elevated manufacturing and logistics costs more than offset savings initiatives.The comparison with incremental shipments ahead of the prior-year ERP transition reduced the margin by about 150 bps. The GOJO inventory step-up created another roughly 150-bps drag. The adjusted gross margin, excluding acquisition and integration costs, was 42.8%. Selling and administrative expenses increased 0.7% year over year to $298 million from $296 million in the year-ago quarter. These expenses represented 15.3% of net sales and included $21 million of GOJO integration costs.Advertising costs rose 26.3% year over year to $216 million from $171 million, and represented 11.1% of sales. Research and development expenses were unchanged at $32 million. Health and Wellness sales increased 16% year over year to $860 million. The GOJO acquisition contributed about 28 percentage points to growth. Organic sales declined 12% because of the ERP-related shipment comparison, while segment adjusted EBIT fell 15% to $206 million.Household sales decreased 18% to $524 million, led by a 16-point volume decline and two points of unfavorable price mix. The decrease reflected the ERP comparison and shipments ahead of consumption in the fiscal third quarter. Segmental adjusted EBIT plunged 56% to $69 million amid lower sales and higher commodity costs.Lifestyle sales declined 17% year over year to $280 million. Volume fell 14 points, while unfavorable price mix reduced growth by another three points. Segment adjusted EBIT decreased 60% to $38 million, mainly because of lower revenues.International sales increased 4% to $281 million, primarily supported by favorable foreign exchange rates. Organic sales rose 1%. Segment adjusted EBIT advanced 17% to $27 million on higher sales and cost savings. For fiscal 2027, CLX expects net sales growth of 13-14%, including 9.5 percentage points from GOJO. Organic sales are projected to rise 3.5-4.5%, including more than 3.5 points of benefit from lapping the ERP-related inventory drawdown.The company expects a gross margin of 42%, as stronger-than-normal inflation and unfavorable mix are anticipated to more than offset cost savings. Selling and administrative expenses are projected at 16% of sales, while advertising spending is expected to be 10%.Adjusted earnings are forecast between $5.70 and $6.00 per share, implying growth of 3-8% year over year. Reported earnings are expected between $5.41 and $5.71 per share, including 29 cents of GOJO transaction-related costs. The fiscal 2026 operating cash flow decreased 38% year over year to $612 million due to the Glad Venture Agreement termination payment. Management expects the fiscal 2027 free cash flow to be 11-13% of net sales. Clorox ended fiscal 2026 with $143 million in cash and cash equivalents. Long-term debt rose to $3.98 billion from $2.48 billion a year earlier, while notes and loans payable increased to $1.09 billion from $4 million following the GOJO transaction. In the past month, investors have witnessed a downward trend in fresh estimates. The consensus estimate has shifted -21.06% due to these changes. At this time, Clorox has a subpar Growth Score of D, however its Momentum Score is doing a lot better with an A. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for value investors. Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Clorox has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months. Clorox belongs to the Zacks Consumer Products - Staples industry. Another stock from the same industry, Albertsons Companies, Inc. (ACI), has gained 3.2% over the past month. More than a month has passed since the company reported results for the quarter ended May 2026. Albertsons Companies reported revenues of $24.94 billion in the last reported quarter, representing a year-over-year change of +0.2%. EPS of $0.42 for the same period compares with $0.55 a year ago. Albertsons Companies is expected to post earnings of $0.33 per share for the current quarter, representing a year-over-year change of -25%. Over the last 30 days, the Zacks Consensus Estimate has changed +0.5%. The overall direction and magnitude of estimate revisions translate into a Zacks Rank #5 (Strong Sell) for Albertsons Companies. Also, the stock has a VGM Score of A. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Clorox Company (CLX) : Free Stock Analysis Report Albertsons Companies, Inc. (ACI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

The Clorox Company CLX enters fiscal 2027 with GOJO Industries as a major new growth contributor. The acquisition, completed in April 2026 and now operating as Clorox Purell, expands the company's health and hygiene platform and is expected to add materially to reported sales.That growth comes with a near-term trade-off. GOJO should support earnings, but acquisition-related costs and a different business mix arrive as Clorox already faces elevated inflation, negative mix and pressure on gross margin. Clorox expects fiscal 2027 net sales to increase 13-14%, with GOJO contributing about 9.5 percentage points. The combined global health and hygiene portfolio now represents more than half of net sales, giving the acquisition a meaningful role in the company's growth profile. Image Source: Zacks Investment Research The first quarter will make GOJO's impact especially visible. Clorox expects net sales to rise 31-32%, including about 15 points from the acquisition. Organic sales are projected to increase 16-17%, but the comparison with last year's enterprise resource planning inventory drawdown adds about 18 points. Excluding that effect, underlying organic sales are expected to decline. GOJO is expected to be accretive to adjusted earnings in fiscal 2027. Management said integration progress has been encouraging, the groundwork for synergies is underway and financial benefits are expected to begin materializing in the fiscal fourth quarter.For the full year, adjusted earnings are projected at $5.70-$6.00 per share, up 3-8%. Reported earnings are expected at $5.41-$5.71 per share, including about 29 cents of GOJO transaction-related costs. The setup means GOJO can help earnings, even while integration expenses remain part of the near-term picture. The Clorox Company price-consensus-chart | The Clorox Company Quote Clorox expects fiscal 2027 gross margin of about 42%, including roughly 20 basis points of pressure mainly from GOJO inventory step-up costs. The first-quarter margin is expected near 40%, with about 50 basis points of acquisition-related inventory step-up pressure. Higher-than-normal inflation and negative mix are expected to more than offset cost savings.Selling and administrative expenses are projected at about 16% of sales, including around 40 basis points of GOJO transaction-related costs. Clorox also expects inflation to exceed $200 million in fiscal 2027, more than double its historical $75-$100 million range.The broader staples backdrop shows why margin execution matters. The Procter & Gamble Company PG expects fiscal 2027 organic sales growth of 1-3% while absorbing about $1 billion after tax from higher raw material, energy and transportation costs. Church & Dwight Co., Inc. CHD, by contrast, raised its 2026 organic sales outlook to 4-5% and expects adjusted gross margin expansion of 100-120 basis points. GOJO gives Clorox a clear reported-sales catalyst and a path to longer-term revenue synergies. Yet the quality of fiscal 2027 growth will depend on how much improvement comes from the underlying business once acquisition and enterprise resource planning comparison benefits are separated out.Near-term Zacks signals remain cautious. The Zacks Consensus Estimate for fiscal 2027 earnings is $5.82 per share and has declined 3.8% in the past four weeks. CLX currently carries a Zacks Rank #4 (Sell), with a Value Score of C, Growth Score of D, Momentum Score of F and VGM Score of D. The rank reflects unfavorable earnings estimate revision trends, while the weaker Growth, Momentum and VGM Scores suggest limited support from those investment styles despite a middle-of-the-range Value Score. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Clorox Company (CLX) : Free Stock Analysis Report Procter & Gamble Company (The) (PG) : Free Stock Analysis Report Church & Dwight Co., Inc. (CHD) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Colgate-Palmolive Company CL strengthened its 2026 profit outlook after a second-quarter earnings beat and 140-basis-point gross-margin expansion. Base Business EPS rose 8%, while organic sales growth reflected contributions from both volume and pricing. The update shifts attention to durability. Management is raising the earnings and margin view while keeping advertising elevated, but higher second-half raw-material and tariff costs and continued North American weakness could absorb part of the operating gains. Base Business earnings were 99 cents per share, up 8% year over year and 4.2% above the Zacks Consensus Estimate of 95 cents. Net sales increased 4.9% to $5.36 billion, edging above the consensus mark of $5.35 billion. Colgate-Palmolive Company price-consensus-eps-surprise-chart | Colgate-Palmolive Company Quote Organic sales advanced 2.4%, with organic volume up 0.8% and pricing contributing 1.6%. Worldwide organic volume improved sequentially for a third consecutive quarter, broadening the growth profile beyond pricing alone. GAAP and Base Business gross profit margin expanded 140 basis points to 61.5%. Revenue growth management, productivity, pricing and mix supported the improvement, giving Colgate more room to absorb inflation and fund growth initiatives. Base Business operating profit increased 5% to $1.1 billion, while operating margin edged up 10 basis points to 21.4%. Those gains came despite higher selling, general and administrative expenses and continued brand investment. Management now expects mid-single-digit Base Business EPS growth in 2026, up from its prior low- to mid-single-digit view. It also improved both GAAP and Base Business gross profit margin outlooks to roughly flat year over year from down previously. Image Source: Zacks Investment Research The top-line framework did not change. Colgate still expects net sales growth of 2-6% and organic sales growth of 1-4%, with the latter including the private-label pet food exit. Execution, rather than a higher sales target, is carrying the profit upgrade. Advertising spending increased 15% to $777 million from $678 million a year ago. Management expects investment to remain elevated in the second half, with premium, science-led innovation and omnichannel demand generation central to the strategy. The company is funding growth rather than protecting the new earnings target by cutting brand support. That trade-off matters because raw-material and tariff costs are expected to be higher in the second half than in the second quarter. Latin America delivered 5.3% organic sales growth, Asia Pacific posted 5.2% and Europe, Middle East and Africa rose 2%. North America moved the other way, with organic sales down 3% and organic volume declining 3.9%. The Procter & Gamble Company PG is a useful comparison because its portfolio includes Crest and Oral-B in oral care and major fabric and home-care brands. The Clorox Company CLX provides another household-staples reference point through its cleaning, household and natural personal-care businesses. The second-quarter event improved Colgate's profit setup, but it did not remove the main risks. Margin execution and earnings growth have strengthened, while North America, promotional pressure and higher second-half costs keep the outlook balanced. CL currently carries a Zacks Rank #3 (Hold). It also has a VGM Score of B, Growth Score of B, Momentum Score of B and Value Score of D. The rank is consistent with a hold posture rather than a top-ranked buy signal, while the Style Scores show favorable growth and momentum characteristics but weaker value. The Style Scores complement the Zacks Rank rather than override it. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Colgate-Palmolive Company (CL) : Free Stock Analysis Report Procter & Gamble Company (The) (PG) : Free Stock Analysis Report The Clorox Company (CLX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Clorox’s second quarter generated a positive response from investors, as revenue surpassed analyst expectations despite a 2% year-over-year decline. Management attributed the quarter’s performance to targeted improvements in product superiority, focused brand investments, and effective promotional execution in key categories. CEO Linda Rendle noted that, “the majority of our businesses are performing at or above expectations,” while acknowledging operational challenges in segments like Litter and Grilling. The company also highlighted ongoing productivity initiatives and the early integration of the GOJO acquisition as factors supporting sequential progress across the portfolio. Is now the time to buy CLX? Find out in our full research report (it’s free). Revenue: $1.95 billion vs analyst estimates of $1.90 billion (2% year-on-year decline, 2.6% beat) Adjusted EPS: $1.66 vs analyst estimates of $1.65 (0.9% beat) Adjusted EPS guidance for the upcoming financial year 2027 is $5.85 at the midpoint, missing analyst estimates by 1.7% Operating Margin: 12.9%, down from 21% in the same quarter last year Market Capitalization: $12.72 billion While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Peter Grom (UBS) asked about muted category growth and market share expectations; CEO Linda Rendle explained the outlook assumes continued value-seeking behavior but expects sequential share improvement, particularly outside of categories facing weather-driven headwinds. Filippo Falorni (Citi) inquired about the progress of market share gains; Rendle detailed ongoing strength in Home Care and Professional, while noting that Litter and Grilling required further turnaround efforts. Andrea Teixeira (JPMorgan Chase) sought clarity on the GOJO integration and promotional activity; CFO Luc Bellet confirmed GOJO’s accretive performance and Rendle emphasized that promotional levels would remain elevated but structurally consistent with pre-pandemic trends. Kevin Grundy (BNP Paribas) questioned the dividend payout policy given high free cash flow targets; Bellet responded that the elevated payout ratio was viewed as transitory, with expectations of normalization as margins recover. Lauren Lieberman (Barclays) asked about SG&A efficiency and ERP-driven savings; Bellet stated that productivity gains should more than offset inflation in SG&A, with further benefits from the ERP system expected later in the year. In coming quarters, the StockStory team will monitor (1) the pace of gross margin recovery as productivity and pricing measures take hold, (2) market share trends in underperforming categories like Litter and Grilling, and (3) the realization of synergies and revenue growth from the GOJO integration. Progress in e-commerce and new product launches will also be critical for sustaining momentum. Clorox currently trades at $105.80, up from $98.26 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free for active Edge members). WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses. But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.

Image source: The Motley Fool. Monday, Aug. 3, 2026, at 5 p.m. ET Vice President of Investor Relations - Lisah Burhan Chair and Chief Executive Officer - Linda Rendle Chief Financial Officer - Luc Bellet Operator: Good day, ladies and gentlemen, and welcome to The Clorox Company Fourth Quarter Fiscal Year 2026 Earnings Release Conference Call. [Operator Instructions] As a reminder, this call is being recorded. I would now like to introduce your host for today's conference call, Ms. Lisah Burhan, Vice President of Investor Relations for The Clorox Company. Ms. Burhan, you may begin your conference. Lisah Burhan: Thank you, Jen. Good afternoon, and thank you for joining us. On the call with me today are Linda Rendle, our Chair and CEO; and Luc Bellet, our CFO. Please note also that our earnings release and prepared remarks are available on our website at thecloroxcompany.com. Linda will share a few opening comments, and then we'll take your questions. During this call, we may make forward-looking statements, including about our fiscal year 2027 outlook. These statements are based on management's current expectations but may differ from actual results or outcome. In addition, we may refer to certain non-GAAP financial measures. Please refer to the forward-looking statements section, which identifies various factors that could affect such forward-looking statements, which have been filed with the SEC. In addition, please refer to the non-GAAP financial information section of our earnings release and the supplemental financial schedule in the Investor Relations section of our website for a reconciliation of non-GAAP financial measures to the most comparable GAAP measures. I will turn it over to Linda. Linda Rendle: Thank you for joining us today. Throughout fiscal year 2026, we operated in a dynamic environment marked by heightened value-seeking behavior, increased competitive activity, inflationary pressures and ongoing macroeconomic uncertainty. We moved with urgency on incremental short- and medium-term actions to better serve consumers and compete more effectively in this environment. That work is focused on advancing superiority in key categories by sharpening our product experiences, strengthening our price pack architecture, improving our promotion effectiveness, increasing the impact of our brand-building investments and ensuring we are present where consumers choose to shop. At the same time, we took strong actions to advance our long-term strategy while continuing the always-on transformation work that is strengthening our capabilities, improving productivity and positioning the business for more consistent profitable growth. While the majority of our businesses are performing at or above expectations, we have taken decisive actions to improve in the areas that are not yet delivering what we expect. We are encouraged by the sequential improvement and the progress we are making. As we look at fiscal year 2027, we're confident in our strategy and the stronger foundation we've built. Our focus remains on the priorities that will create long-term value, delivering superiority across our portfolio, accelerating consumer-led innovation, investing behind our brands, shaping a portfolio structurally positioned for faster growth, advancing operational excellence and generating fuel to reinvest in the business. With that, Jen, we'll now open the line for questions. Operator: [Operator Instructions] And our first question comes from Peter Grom with UBS. Peter Grom: Two questions just on the top line. So maybe just a lot of moving pieces here, but you noted weaker category growth. Can you maybe just unpack what's embedded from a category standpoint relative to market share in the flat to up slightly organic sales outlook? Linda Rendle: Peter, I'll start. So what we referenced as weaker category growth is very consistent with actually what we saw in fiscal year 2026. We expect the categories to continue to be muted given what's going on from a macroeconomic perspective and consumers continuing to engage in value-seeking behaviors, largely consistent with what we saw in 2026. Of course, we're watching that very carefully because this outlook assumes more of a continuity in category growth and no significant displacement depending on what happens with inflation and what happens in the Middle East, et cetera. But I would say very much in line with the category growth that we saw in 2026. And then from a market share perspective, we expect to continue to make progress on market share. We had a number of categories that had turnarounds, particularly the exit rate much stronger. Food, Glad, Home Care continued to be strong, but we expect to continue to make progress throughout the course of the fiscal year on market share, and that gets us to the combination of what we expect from an organic growth perspective. Peter Grom: Great. And I guess just to that point, so you're expecting a slower start to the year. It sounds like a continuation of the current consumption trends as well as some of the timing-related impacts from grilling and some merchandising. So is that improvement simply just the absence of those latter impacts? Or are you expecting consumption trends to also show signs of improvement as we move through the year? Linda Rendle: We -- right now, Q1 is a timing issue for the most part, as you noted, on Kingsford in particular, we can talk about the Grilling season that's underway, but really a timing impact to Q1. And then we would expect the remainder of the year, particularly the back half, more in line with the trends that we've seen over the course of '26. And if you look at what we've done every quarter, we've made sequential improvements. So consumption sequentially improved with a stronger exit rate getting back to flat consumption in Q4. Share sequentially improved. Our exit rate in June was nearly flat. If you look at our category share results. Distribution continued to improve. Merchandising continued to be more effective. And so Q1 is a blip given some timing issues, but we would expect that pattern to continue, particularly again in the back half of '27. Operator: Our next question will come from Filippo Falorni with Citi. Filippo Falorni: So Linda, maybe just picking up on Peter's question. From a market share standpoint, can you give us an update on where you feel you've made the most progress so far from a category -- at the category level, where you think there's more room to go in fiscal '27? And is the expectation to exit the year with some share gains? Like help us understand a bit the market share trajectory as you think about fiscal '27. Linda Rendle: Sure, Filippo. So starting in aggregate, again, we saw a sequential improvement if you looked at fiscal year '26 from Q1 to Q4 with getting to close to flat, we're down 1/10 of a share point in aggregate. And that was due to a number of businesses continuing to perform from a share perspective. We saw our Home Care business continue to deliver share growth. We're at 8 consecutive quarters of share growth in Home Care. We continue to see strong share growth in our Pro and International businesses. And then really importantly, we saw market share turnarounds in Glad behind our reinvestment in superiority across a number of levers. And so we saw trash grow in Q4. And then importantly, despite the category still being a bit soft, we saw the turnaround of share for Hidden Valley Ranch behind all of the actions we took on innovation, price pack architecture, marketing spend and our activation against the World Cup. And we want to continue to make that progress in '27, and all of those businesses have strong innovation plans, have strong brand investments. And so we continue to expect those businesses to perform from a market share perspective heading into '27. We want to continue to make progress in other areas. So of note would be Litter, where if you look at the most recent weeks, some of the incremental actions we've taken to improve superiority are leading to a better trend on market share, but we're far from where we want to be on that business, and we knew that this transformation would take time, but we'd expect to make progress in that. And then as well as Kingsford, maybe I'll just go ahead and talk about the season for Kingsford right now. I think that would be helpful. So if you look at the category from a Grilling perspective, across all fuel types, including pellets for the first time, the category declined, and this was largely and mostly due to weather-related issues on major holidays. So Memorial Day was unseasonably chilly and wet across most of the U.S. And then for July 4, 185 million Americans were under heat advisory and almost 150 daily city temperature highs were broken during July 4 weekend. So we saw less growing behavior from consumers, and that significantly impacted the category. In addition, retailers made some choices on merchandising to go after value shopping consumers and put smaller sizes on deal. We'll correct that next year because it's actually better to load consumers earlier in the season. And so that was a learning, and we won't repeat that next year. So that is what you're seeing in the category and share results for Kingsford, but we would expect that to also improve as we head into season year '27 that will start in March of next year. Filippo Falorni: Great. And then one question for Luc. At the gross margin line, can you remind us what is your expectation in terms of commodity costs for the year and the commodity headwind? And what assumption you have for oil prices for the year? Luc Bellet: Sure, Filippo. So we expect fiscal year '27 inflation to be above $200 million. So for perspective, it's about more than double our historical range, which has been in the $75 million to $100 million. Now clearly, the current geopolitical backdrop continues to create volatility across energy, commodity and supply chain markets. So our outlook assume an average for Brent crude oil at about $90 per barrel. But importantly, it's not just energy or commodity stories. While commodities remain a significant driver, we are also seeing inflation across broader areas of supply chain, including supplier cost, ocean freight, trucking costs and other logistic-related expenses. So as a result, it's fair to say that inflationary pressures are proving more persistent and should extend well beyond what is just reflected in the headline for the oil price. The last thing I would mention is there's a dynamic from a timing standpoint. We expect the impact of the inflation to be more pronounced in the first half of fiscal year '27. Operator: We'll move next to Andrea Teixeira with JPMorgan Chase. Andrea Teixeira: So I wanted to go back to the impact of GOJO and also kind of a clarification on the promo environment. On -- I'm sorry, the -- obviously, we can calculate how much the impact was on a like-for-like basis or the additional M&A. But can you comment on how sales have been performing as an organic basis if you were to compare like-for-like? And then any indications of the plans? I think the integration you mentioned in the prepared remarks has been going well, but obviously, it's still in the phase of integration. And then clarification on the promo is like how we should be thinking about [ interations ] with some of the promo. So I wanted to see if there is any puts and takes from Prime Day earlier, anything we should be aware of coming into the fiscal '27. Linda Rendle: So Andrea, I'll start with GOJO, and I'll pass it to Luc to get into some more of the financial details. We're really pleased with the start that Clorox Purell has had. We are seeing the strategic rationale for this acquisition playing through. And of course, I'll note it's early, but we continue to feel great about the synergies, about the opportunities to enhance growth and the integration is going as planned and in some places, slightly ahead given the opportunities that we found. If you look at the business performance outside of what we just thought you would add from a company perspective, like-for-like, that business continues to perform very strong. So they were actually ahead of their targets for Q4, and they have strong plans embedded into this outlook for fiscal year '27. So feeling very good about the base health and feeling very good about our Pro business in tandem, which delivered a strong Q4, and we have a lot of confidence that business will continue to be accretive and additive to the company's performance. Luc Bellet: Yes. So I think from a financial standpoint, most of it will be in the adjustment, except the fourth quarter, where we'll start the growth in GOJO would start impacting the organic sales growth. And it will be an outsized growth contributor. But it's just a quarter, so it's fairly small for the full year. Going forward, though, we fully expect this business to continue growing at mid-single digit, and we expect to start seeing some of the revenue synergies showing up as early as next year. And so once we start putting those in place, we probably -- our expectation for the business would be mid- to high single digits for a few years as we realize those synergies. And since we're talking about financials, maybe just 2 more comments. Linda mentioned the business is actually performing well and a little ahead of their plan. So they were actually accretive, not dilutive as we anticipated in the fourth quarter, and we expect them to be accretive to adjusted EPS as well next fiscal year. So that -- as you remember, we expected them to be initially neutral. So that's a stronger performance. And then last thing, we talked about it in our prepared remarks, and we talked about it last time, but it's just helpful to remember that GOJO is a B2B business and has a different P&L profile than The Clorox company -- legacy. So when you look at the pro forma of the business we acquired on a gross margin standpoint, there's about 0.5 point of dilutions. And then there's SG&A will be the post acquisition about less than 1 point higher than what it was. And then advertising is about 1 point lower than what it was. So just keep that in mind as you look at the different lines on the P&L for our outlook. Linda Rendle: Good, Andrea, and then I'll turn to your question on promotion. So I'll maybe just make a comment on Q4 and then what we expect for '27. So for Q4, to your point, there was some noise in the promotional numbers, which meant that promotion was higher than a year ago given the Prime Day shift into Q4 from a category perspective. But we view that as a timing issue versus a significant change in the increase -- in a promotional environment as a percent of sales. What we expect for fiscal year '27 is a continued elevated promotional environment given the focus on value, and that's more in line with what we saw pre-COVID levels, and that varies again by category, but for the most part, just returning to those more historic promotional levels. And then, of course, you'll see a little bit of noise in timing in Q1 given the shift in Prime Day, but nothing structurally different from a promotion perspective. Operator: And we'll move to our next question. This comes from Anna Lizzul with Bank of America. Anna Lizzul: Linda, as you look at the business now and where it stands with some of the portfolio changes you've made in the last few years, especially on innovation and with the GOJO acquisition, do you see an opportunity here for potential portfolio trimming with some of the underperforming categories like Litter? And now that we are near the third anniversary of the cyberattack, I wanted to ask in light of that, how do you see those impacted businesses performing? And if some of the investment is maybe better used on other parts of the business or categories at this point? And secondly, as the challenging economic environment for consumers continues and you're expecting lower category growth, how is this impacting your plans for innovation and different pack sizes across the portfolio? Linda Rendle: Anna, great. I'll start with portfolio. I'll probably move to your third question second, and then I'll tackle the cyberattack question to bring it home. So from a portfolio perspective, we are very pleased with the results of the disciplined action we've taken on our portfolio over the last number of years. The divestitures we've made aimed at getting a more predictable and steady and higher growth company, and that certainly has played out in the divestiture of Argentina and vitamins, minerals and supplements and as well as the large acquisition we made in GOJO, we see very clear line of sight to that improving company performance. And what I'll say is we'll continue to be disciplined, just as we've shown up over the last number of years. We regularly review our portfolio as a management team and a Board, and we're always looking to see, is there a way to strengthen our core, whether that be through acquisitions or divestitures. And again, just stay disciplined. It's always focused on shareholder value. It's always focused on ensuring that we have the capabilities that can execute with excellence against each of the businesses that we own, and that's the way that we'll approach it. So hopefully, based on our track record, you can see the exact way that we'll approach us moving forward, although nothing to comment on at the moment. And then as you look at just the challenging categories, I think there's 2 things to note. And both of them are challenges in some ways, but both of them are very big opportunities. And what this is predicated on is we believe we are the drivers of category growth. And of course, there are things that impact category growth macroeconomics, where the consumer is. But as the leaders of categories when you have #1 and #2 share brands, we take the job very seriously that our job is to grow the category. And of course, we'd like to grow share in those categories as well. And we're focused on 2 major areas to do that. The first is addressing value seeking across consumers, and we see that across all consumers, most potent in low-income consumers right now. But we are laser-focused against every aspect of value superiority. And for us, we have a superiority model. We've shared this before. It takes into account the product, the package, the proposition, the place, so where consumers can find it and of course, the price. And we're looking through all 5 of those levers by business, by retailer to ensure that we have value superiority, and we're laser-focused on that. And so what you'll see in the plan that we just finished in '26 is we made some of those investments. Glad trash and Hidden Valley are 2 great examples, and those are playing out in share growth. As we head into fiscal year '27, we're also going to be making additional investments in superiority to do the same thing. We're going to be investing in some product superiority on a number of our big businesses, including packaging upgrades. We're investing in some places in a targeted way like we did with Glad on pricing because based off the amount of pricing we took since COVID, there's a few places where we need to make adjustments. And that's going to be a key focus for us as we move forward to continue to support consumers and category growth. And then very, very importantly, consumers continue to look for better experiences overall. And of course, value is part of that, but they are looking for us to address trends that are important to them in their lives. And we highlighted some of them in the prepared remarks, but consumers continue to focus heavily on their wellness, and there's opportunities to provide them solutions like we're doing with Clorox PURE on their allergies, or continuing to address pet health in Litter. There's just a number of opportunities that we can address to ensure that we continue to support category growth and support getting back to more normalized category growth over time. And we do that through innovation. In '26, our innovation as a percent of sales doubled, and we expect continued progress in '27. We have a very strong slate of innovation targeted at those trends and ensuring that we deliver value to consumers. So that's how we're thinking about it. And then finally, on the cyber attack, I think it's a good point, Anna. Between COVID and supply chain disruptions and the cyberattack, we've been very operationally focused as a company, getting back the basics. When you lose distribution after cyber, you have to get that distribution back. Your competition has, in many cases, had a 6-month head start on you on innovation because they haven't been focusing on that. And so job one was restoring distribution, which we did, restoring the fundamentals, which we did. And now most of the businesses have also been able to welcome consumers back fully. So I give a good example, Home Care did that in full, and you can see the share results. And I feel great about trash and food and some other of our businesses at the same time. Litter is the one that I would say continues to have a hangover. Given the operational challenges on that business, given the amount that was on e-commerce, et cetera, I feel good that we've gotten distribution points back, but we're still working through our Litter reinvention to ensure that consumers know that we are better value than competition and making sure that, that is clear on packaging and the way that we talk to them in our marketing, improving the product, et cetera. And we're making some additional investments in superiority to deal with that. So I would say largely, we're through a lot of the cyberattack effects, but you have seen over the last couple of years just that operational intensity at higher levels. And we're getting back to innovation, getting back to full brand building and leaving most of that behind, which is energizing to us as a management team and as a company. Operator: Our next question will come from Bonnie Herzog with Goldman Sachs. Bonnie Herzog: I just had a quick question first on your EPS guidance. I guess I'm wondering why your range is, I guess, relatively wide versus the tight guidance range on sales and the specific 42% gross margin guide. Maybe you could help frame for us what's implied at the bottom end versus the top end of your EPS growth guidance range this year? Luc Bellet: Yes, Bonnie, I can take that. The I mean it's -- at the end of the day, there's a lot of moving parts, especially with the transitory element on ERP. But if you look and the fact that we are comping a lower-than-usual incentive comp in the base year. But if you remove all those, essentially the main impact on the EPS is the lower gross margin. And what it is about 42%, it actually -- there's a little bit of movement and the EPS is quite sensitive. And as I just mentioned, this is probably where we have the environment around the cost and commodities and especially the timing more than the total is what's leading to a slightly wider than usual EPS range. Bonnie Herzog: Okay. And just maybe a second quick question on A&P spend for the year. How should we think about phasing of that spend throughout the year? And I'm asking in the context of the incremental spend related to GOJO and then the steps that you've talked about as you're continuing to overhaul your Litter business. Linda Rendle: Sure, Bonnie. I would consider ex GOJO, where we're spending over 11% of sales as we have in the past over the past number of years where we increased it from 10% to continue. And so the 10% reflects GOJO's lower percent of advertising and sales promotion. And I would just consider phasing to be very much like we've thought about in prior years. We tend to heavy up our spending during key pulse periods whether that be back-to-school, cold and flu and particularly when we're launching new innovation, which tends to happen in Q3 and Q4. And again, we're not super detailed on when we have that spending. We want it to mirror the business plan, but it should look largely like other years have in the past. Operator: Our next question comes from Robert Moskow with TD Cowen. Robert Moskow: I have a couple. One for you, Luc. It's great to see all these investments in digital capabilities in the rearview mirror, your ERP is set up. Can you give us some examples of how it's helping you move faster maybe, make decisions with fewer touches, combined data pools? And are we right to think that at some point, it can help you shrink your overhead costs as the organization learns to use the new platform? Luc Bellet: Yes. Thanks, Robert. Yes, nice to start seeing the cost noise and volatility associated with this large complex implementation in the rearview mirror. And we expect to see the benefit ramping up. It will take a little while. We're just very much in stabilization mode right now, and we're going to start seeing optimization across the supply chain and across our admin functions I would say, probably later this fiscal year and then into next fiscal year. This is when we'll see the brand of the benefit on efficiencies. There is -- as you can imagine, there is obviously some productivity gain to be had on the supply chain through just better planning, lower inventory levels, just more automation opportunities, but there's actually a lot of effectiveness. And where we start seeing it is now people are able to see end-to-end data. So you can have just your supply chain being much more reactive and in some case, proactive to some change in demand signal. So we start seeing this in our integrated business planning though, and we also see a lot of efficiency like we have some initial inefficiencies that we'll be lapping, but some efficiencies in our demand fulfillment and order-to-cash functions. And then later, we also expect to see much more automation and efficiencies in the back office. We went from an environment that was quite manual working on spreadsheets with now fairly automated. And I think I had mentioned this, one of the benefit also of upgrading our digital infrastructure is we're able to take advantage at a broader scale of global business services. And so this is something that will accelerate in the next few years, and that's a great source of productivity for us in SG&A. Robert Moskow: Okay. Very good. Luc, was there any quantification of what those inefficiencies were in fiscal '26 to maintain customer service? Is it material enough to provide a benefit in comparison in '27? Luc Bellet: Yes. If you remember, Robert, we experienced most of those in the second quarter and the third quarter. There's a little bit of a range with it, but I would say it's under half of range. And then we definitely included that lapping in our gross margin guidance. Operator: And we'll move next to Kevin Grundy with BNP Paribas. Kevin Grundy: Luc, first one for you, if I may. Just on visibility on free cash flow and then sort of relative to the dividend policy. Then I have a follow-up on pricing for Linda. So specifically on the dividend, as you're well aware, the Board decided to modestly increase the dividend again. It sets the payout ratio for you guys around 85% of net earnings. The group, the Staples Group is around 50% to 60%. It's not quite as onerous from a payout ratio perspective if we look at free cash flow, provided that the company is able to deliver against this 11% to 13% of sales, which has been a bit choppy in recent years given all the volatility. So that's all kind of a big wind up, Luc. Maybe just comment on the current dividend policy why you think it's appropriate, I guess, given that payout ratio has crept up and is well above Staples peers? And if there is any consideration by the Board to potentially look at a reset to free up capital flexibility for more reinvestment elsewhere. Luc Bellet: Kevin, thanks for the question. Actually, let me use the framing like that. I'm going to start with talking about free cash flow. So we have a business model that generates and continue to generate strong free cash flows. In fiscal year '27, we expect another year of strong cash flow generation that should be in line with our targeted range of 11% to 13%. That does include the temporary lower margin in the front half of the year, driven by the elevated cost headwinds, but it also includes some continued focus on working capital and balance sheet discipline to drive cash flow improvement. So net, we feel good about cash flow. As a reminder, GOJO also bring some -- not only some strong cash flows in line with the 11% to 13%, but very stable cash flow because of their installed base. And beyond that, the way we structured the acquisition of GOJO, we also expect to see some tax benefit in the years to come. So all of that is actually just helping strengthening the cash flow. So net, feel good about our cash flow generation. Within that context, I think answering your question on dividend, I think at this point, our commitment to support the dividend has not changed. As you know, we have a long track record here. Dividend has increased annually for a decade. And for now, you should expect this to continue. We do regular reviews with our Boards, and we have a really robust process. And at this time, we are comfortable with our current dividend. As you mentioned, the current payout is a bit elevated, but we see this as something more transitory as we rebuild our gross margin and not something structural. So -- but of course, we'll continue to evaluate this over time. Kevin Grundy: Very good. If I could just squeeze in a quick follow-up. Maybe it's not quick. But for you, Linda, on the pricing side, I guess I'm a bit sort of intrigued by the reluctance for more pricing when there seems to be a price justification for it and more on household products and less in personal care. So this is an industry sort of question. It's a proctor question. It's a Church & Dwight question, et cetera, where it seems like in past cycles, there's been more of a, I guess, a leaning to use that as a lever when it seems like the pricing window would be open and there's a price justification for it. And it sort of begs the question, is it just cyclical? Or do you think that there's something more secular going on in some of these categories and particularly those where you play where private label is high. So whether this is going to be trash bags, whether this is going to be bleach, whether this is going to be Litter, et cetera. So I'd just be curious to get your thoughts on that and whether you think that has merit that there may be a loss of pricing power within some of these household products categories. Linda Rendle: Yes. Thanks for the question, Kevin. So I don't view a structural issue on pricing over the long term in our categories. We see consumers to continue to accept pricing and better innovation that we price for with better experiences. And that's playing out in many of our categories today. I think I'll speak for Clorox only. What we view is a unique period of time where we have near back-to-back inflation cycles off of a record-setting inflation cycle back in '22 and '23, where we experienced costs at a level 10x higher than what we had normally experienced, and we took 4 rounds of pretty substantial pricing across our categories. And it turned out that the elasticities in that pricing were a bit better than we had expected. But now as consumers come under pressure, you can kind of see little places where we've had to adjust pricing, et cetera. So I think from our perspective, we just look at our toolbox because pricing is only one tool in the toolbox and say that it is best for our categories right now to take targeted pricing, which we are doing. There are places where we are taking a regular price increase. Glad is a good example, given its commodity exposure to resin. We are taking a regular price increasing at that category and have already announced and implemented that pricing. But in other places, we're being much more targeted. And we're using the other tools we have in the toolbox, which we feel confident about, whether that be revenue growth management, price pack architecture, cost savings, and we'll have another strong year of all of that this year. And we have our confidence ability to do it over the mid- to long term. So I think, Kevin, the point is it's a unique period where we typically have a bit longer between inflation cycles. I think given the uncertainty and volatility consumers are experiencing, we are just being more targeted in the toolbox, but feel fully confident that these categories can take pricing over time. We'll continue to do that through innovation. Again, we'll take targeted pricing this year where we think it's warranted, and we'll take a straight price increase on Glad trash, as you might expect. And I think as we move forward, when we get back to hopefully a more normal set of cycles around inflation, you'll continue to see pricing be a strong lever for our types of business. Operator: We'll move next to Kaumil Gajrawala with Jefferies. Kaumil Gajrawala: I guess the big question is on what's the right level of spending. It looks like shares are just slowly starting to get better Hidden Valley Ranch may have had a bit of a boost from the World Cup. We don't know if that's sustainable or not. Why not maybe a higher figure for investment as you just to assure that you don't end up back in the situation you were in earlier with more broader share losses because it feels like we're sort of just at the edge, and I'm curious what the math is behind what that right level of spending is? Linda Rendle: Kaumil, I'll tackle that. So first, I wouldn't attribute some of the bumpiness we had in fiscal year '26 to a lack of investment. We had an operationally challenging environment. We were transitioning our ERP in the U.S., et cetera, which caused more of the issues than a spending issue. And what I would say is we looked across every line of investments across the P&L and balance sheet to say, do we have the right level of spending to support superiority in the categories we can see. And we are being very targeted and disciplined about adding incremental spending, and we have done that. You see that in margin this year as we're investing in some product performance. You see that in advertising, where we're spending over 11% in retail again. You see it in our trade spending where trade has been higher. And so we want to do that in a way that we have better data, we can do that in a much more targeted and effective way to get to the place we want to and it's working. You've seen we have been able to increase consumption, increase share over time. We expect that to continue. But that's the way that we approach it. And even in advertising, we expect a very high level of efficiency improvements every year from our team, but we have reinvested those efficiencies back into the business where we have the highest return, and we'll do that again this year. So we feel good about the spending level. If it turns out that the consumer environment weakens or strengthens in any way, those are things that we will reopen up and ensure that we continue to have the right level of spending. And our team is prioritizing ensuring we have superiority, ensuring we support the innovations that are growing the categories in the market that we're launching. And as I mentioned earlier, we have a very strong innovation plan for '27. And if there's opportunities to put good ROI spending in the system, we will. Kaumil Gajrawala: Got it. And then just following up on that a little bit on value-seeking or superiorities. You talked about for 2027 more focus on value seeking more focus on value superiority. There's -- I think sometimes when going through that exercise, you realize maybe a larger percentage of your portfolio, maybe offside there and it may take a while to turn and that it's not just related to price, it's also related to speed of product innovation or whatever it is. So how do you feel about the sort of current set products that you have out or innovations that are coming in the near term that would sort of make sure you're on the right side of the sort of value superiority equation versus where you feel you stand now? Linda Rendle: Yes. I think for the vast majority of our portfolio, I feel very good. We either continue to see performance. So again, I'd call out our health and hygiene business in aggregate, which is over 50% of our business continue to feel very good that we're staying ahead of the consumer on value superiority. There will be places even in that business. We're investing in product improvements this year to continue to advance that superiority and continue to win market share. I feel very good about the changes we've made in Glad. Glad was not just pricing work that we did in large card trash. We also improved our innovation plans. We improved the proposition for better marketing campaign behind Don't get mad, get Glad. And so I feel very good about the comprehensive nature of what we tackled. And then to point we did see a category lift from World Cup, but we grew share significantly. And so our team's ability to activate price pack architecture at that time, strengthen our innovation plans, and, of course, take advantage of the fact that there was a lot of eyes on ranch during that time led us to market share improvements. And we'll watch the category carefully. I feel very good about the plans that the food team has in store for '27. So I would say, largely, we're in a place where we are going to continue to improve security, et cetera. The one I would call out that is early work in progress is litter. We have made improvements across the full range of superiority for all the things I spoke about, product, packaging, the proposition place and really focused on winning in e-commerce, but we've taken some additional actions on pricing recently in a targeted way, and we're seeing improvements off of that, but we'll continue to take additional actions, including launching a set of innovations in the back half. And to your point, come those take a while, innovations don't happen overnight, but you'll start to see those things flow through in the back half of the year, and that will lead to further improvement. Operator: Our next question will come from Chris Carey with Wells Fargo. Christopher Carey: The first question I wanted to ask, just Linda, I suppose a bit of a personal professional update. Clorox has announced that it will be looking for a new CEO, you have been very transparent about you'll be running the business for us as long as is needed. And so can you just tell us how is that process going? What are the sorts of skill sets you're looking for? Do you have any updated view on time line? Would just love to get a little bit more context for the leadership development for the organization if you'll entertain that? Linda Rendle: Sure, Chris. Of course. As we announced back in May, as you note, I informed the Board of my intent to step down from my role given personal health challenges. The good news is I continue to do well. I'm cancer-free and feeling well and continue to execute on my job just like I did before. The Board has made good progress in the search. When we first announced that we let you know that they were in the process of hiring a leading external search firm, they have done that. And I can say that the search is progressing as expected against the time line the Board has laid out. And then from a skill set perspective, that independent group of the board is properly evaluating our strategy and where we are in our execution and looking for the next leader to take that next leap. We've made a very large transformation as a company, rebuilding the foundation of our data and technology, our innovation plans, our portfolio, and of course, it will be up to a new leader to take a fresh look at that, continue the progress, but also depending on where they land, maybe take it in a different direction, too. And the Board is hard at work in determining the right person to do that for the company. In the meantime, we are laser-focused on continuing to execute high personally and laser-focused on continuing to execute and then, of course, ensuring a smooth transition that we will do once that new leader is named. Christopher Carey: Okay. And we're certainly sending you many well wishes. And then just from a fundamental perspective, I just had 2 clarifications from this earnings call. The first would be on why growth accelerates a bit relative to the fiscal Q1, which I think you characterized as a blip. Was that a reference specifically to the seasonal impact of the grilling category? Is it -- if we were to exclude the Grilling business, you should be running about in line with your full year guidance? Or are you looking for something else to improve relative to where you'd be in fiscal Q1? The second clarification is just around pricing. You noted in the prepared remarks projects for pricing. You said strategic pricing several times, including on Glad. How much -- what level of pricing that we should be thinking about when it comes to your for your expectations for flat to slightly positive organic sales growth? Linda Rendle: Sure. For Q1, Chris, you have it right in assuming that the timing impacts due to Kingsford and some other promotional impacts are really the story in Q1. And if not, that would look much like the trajectory for the remainder of the year. So that is the primary impact to Q1, as you note. And then from a pricing perspective, back to Kevin's question, we are taking what we would call targeted or strategic pricing, and we've done that across the portfolio, looking at the places where the purity warrants it, where we feel we have more exposure, but being very disciplined about that. And the one category I called out that is more like it has been in the past is Glad given its exposure to commodities. That price increase is being implemented right now and largely going as expected. But you would see versus historical inflation cycles, if you look back, certainly 2023, a more muted price impact from that perspective, given the degree of pricing we're taking. And then, of course, we price through innovation, which you see as innovations roll out and that gets built in. But that's the extent you won't see a very, very large aspect from straight price increases given the amount that we're using it for this year to offset inflation. Christopher Carey: Great. And just -- is it fair to assume that pricing should be positive when we see the net price line for the end of the year and that the initial outlook for volume is for negative volume that perhaps you think a little bit better over the course of the year. But is that the construct for the outlook? Luc Bellet: That's correct, Chris. We have a few things going on, but net, this is how it will play out. Operator: We'll move next to Javier Escalante with Evercore ISI. Javier Escalante Manzo: I guess I'm going to ask the pricing question from a different angle. Perhaps for Luc, it would be helpful if you frame it on the context of the gross margin in 2027 sort of a bridge, right? You mentioned that commodity inflation is about $200 million plus, so that would you around 300 basis points of negative. So if you can dimension the offset basically the mix or savings or pricing, what have you, that would be very helpful and whether that take, why is it doesn't risk the recovery in market share that you mentioned on Glad? Luc Bellet: Yes, sure, Javier. I can take it. So yes, as you just mentioned, inflation of $200 million would be -- it's going to be more concentrated in the front half. AS you look at our levers to offset those, productivity would still be the primary level, right? And we actually feel very good about the strength of our cost-savings pipeline. And pricing would be another level, strategic pricing. So not as much as productivity. There are other levers that we're taking, Linda just mentioned. In some cases, we're making investments to actually improve our superiority brand position. And it can be adjustment in pricing or trade promotion going the other way. But when you net all of that, we expect to start recovering gross margin in the back half. Now of course, across the full year, we won't be able to fully recover the gross margin, but we expect to exceed the year with a much stronger gross margin. Javier Escalante Manzo: And Linda, if you can comment on the market share? Linda Rendle: Sure, Javier. Is there a particular angle on market share you want me to cover? Javier Escalante Manzo: Yes, because you basically -- I mean, and it seems kind of like antagonistic kind of goal because you talk about value-seeking behavior and the 2 categories where -- that you flag are bags and cat litter. And those -- what you see there is that you have value brands actually gaining share. And basically, investments that you talked about, at least from the cane standpoint, shows negative pricing. So from going from negative pricing, which is what drove the share stabilization to positive pricing going forward if you can help us have your confidence in terms of this is not going to come at expense of the share recovery that you mentioned? Linda Rendle: Yes. I think it's really important that we're balancing those 2 things, Javier. We're balancing, ensuring that we recover margins over time with continued performance from a category and share perspective. So let's just take Glad trash. I think it's a great example. Glad trash is actually growing share, and we feel good about the progress that it has made and we are taking pricing consistent with what we see in the category. We see that the pricing is moving in other parts as well. And typically, when we've taken price in the past, that's a place where share is either neutral or positive. We're going to see how this plays out. We don't know the level of pricing other people will take. We've determined our own level of pricing that we think is right to recover the right degree of commodities combined with all those other factors, but we'll watch it very closely. And the good news is we have better tools to evaluate those changes in pricing. And if we need to make adjustments after we take that price increase, we'll do exactly like we did in Glad trash before. And all of our other businesses will follow a similar model. I'd also call out for Hidden Valley at the same thing. We've been very targeted in how we think about pricing. We've recovered share through good fundamentals through good distribution, strong innovation, good price pack architecture. And so as we layer pricing on top of those things, we will look very carefully to see that, that whole package of superiority is coming together. And if not, we'll make adjustments. But right now, feeling good about the share position we head into, sequential improvement quarter after quarter, exit rate in June the strongest we saw all fiscal year '26, and we'd expect that we continue to make progress in '27. And we know with pricing, it might be a little bumpy or heading in the right direction. Operator: Our next question will come from Olivia Tong with Raymond James. Olivia Tong Cheang: Given the volatility in fiscal '26, can you talk about your retail relationships and how you're adapting your business for the level of promotion in the market? And any other learnings from this year that you think should help you stay better on track towards targets this year? Second, can you talk about inventory levels at the moment beyond the grilling and food-related categories that you talked about for Q1. Is there anywhere else where shipments and sell-in have -- where shipments and sell-in might have diverged? And then lastly, on shelf space, are you still below where you were pre cyber? And what's your view on opportunity for incremental shelf space gains this year? Linda Rendle: Sure. If you don't mind, I'm going to go a little bit out of order. I'll just start with the simple one upfront, which is inventory levels. So largely, we see inventory levels in line with what we would expect and have not seen in our categories any material inventory changes or pressures from retailers. We would expect that to be fluid throughout the year as retailers make choices, but we have no visibility to that. And again, it's short-term noise. It doesn't tend to change the way that consumers consume or how retailers approach our brands in store. But for now, we don't have any aspects outside of the ones that you mentioned with promotional timing in Kingsford. Shelf space from cyber, we fully recovered all the distribution we lost from cyber, and we did detailed planning at a bi-retailer level by business level. Distribution is actually higher today than it was post cyber, and we gained share of distribution this year as well. And based off of our innovation plans, we expect to continue to have another strong year in gaining physical virtual shelf space as well as PDPs. And I think that moves nicely into your question on retailer relationships, Olivia, because the reality is that the sales environment, the retail environment is changing really rapidly and in exciting ways for consumers given the technology, given the data that we all have in the ecosystem, we have an opportunity to give consumer better shopping experiences, whether that be through e-commerce, through the way that we talk to them about our brands all the way to visions of having Agentified commerce where consumers are really out of a lot of the decision-making patterns, and we can ensure that they are spending time doing things they really love doing rather than shopping. And with that, we've invested with our retail partners to ensure that we're ready and leading in many of those aspects. I'd call out, in particular, with some of our larger retailers our focus on e-commerce. We're getting much more sophisticated with those retailer partners on how we talk to consumers in e-commerce, how we translate that into sales, how we tie that into brick-and-mortar stores and our plans there. And we're seeing the impact. We've had a number of categories significantly improved their growth rates in e-commerce. And that will continue to be a focus for the company in '27. We have relatively strong share position in e-commerce, but there are places where we're under-shared and we will make progress this year and ensuring that each category by retailer, we have specific plans for and are laser-focused on e-commerce. And then I think from a future perspective, because we've invested so much in those retailer relationships, we're ready for whatever comes and want to be building in our categories, the plans of the future for retailers. And we've seen that with them. We are a category advisers given our leading share position in most of the categories we compete and we continue to invest in that capability through category growth ideas that we work with retailers on and then, of course, the future of capabilities. So I feel very, very good that our retailer relationships are stronger than they've been, but that's an area where you have to continue to improve year after year, and that's what we're focused on for '27, particularly on the e-commerce side. Operator: And we'll move to our next question from Stephen Powers with Deutsche Bank. Stephen Robert Powers: Maybe can we just -- as you mentioned in the prepared remarks, there's been a lot of work done on Fresh Step over the last several months, and I know it's still relatively early, but maybe a little bit more perspective on what you've seen since you made those changes? And what your expectations are in terms of the progression from here? Linda Rendle: Yes. Thanks, Steve. Maybe just taking a step back on Fresh Step. I think this ties really well to how we talk about growing categories and making sure that we win share in our categories. And that all ties to do we have an overall superior proposition that we're giving the consumer through all aspects. Is the product better? Is the packaging better? Are we communicating that difference to consumers in a way that's compelling? Can they find us wherever they're shopping and is it easy to procure. And then of course, is at the right price. And when we evaluated our plan on Fresh Step, we could see that we were not in a place where we had superiority. And so we overhauled the entire Fresh Step brand to address every single one of those elements of superiority, and we knew that, that would just be a first phase. So we improved the product. We had some product that was -- had too much dust. So we reduced the dusting in our product. We changed our focus on some of the categories where we haven't been competing a lot lightweight is a very important part of the segment, and we had a very small business there. So we've invested in innovation in lightweight. We've invested in packaging changes to consumer preferred packaging in that lightweight. We changed our marketing and all of our e-commerce sites. And then in addition, more recently, we've invested more in price. So that's all in an effort to improve that superiority. But because we changed all of those elements, that takes a while to ensure the consumer understands the value you're getting with that better product, translating that into sales and then translating that into repeat. And that's what we're in right now is getting through the hump of that, making executional changes where things weren't shelled exactly right, making claim changes where we are not communicating exactly right, the product changes, we're in early innings. And then, of course, most importantly, is getting back to a strong slate of innovation that drives the category. And we knew that would take some time, and that really starts in earnest in fiscal year '27, which we're excited to get out in the market in the back half. So I would characterize it as something where given cyber, given the impacts and given the very strong competitive that we have here who continue to make strides, we sell behind the superiority, but we're taking all the right steps to address that. And you can see through examples and whether that be Glad Trash or Hidden Valley that when we put our mind and get that superior right, we can make the right changes to get back to a leadership position in this category. So I feel confident over time, we will, but it's early innings, Steve, and we'll continue to keep you updated as we make progress. Stephen Robert Powers: Yes. Okay. Very good. And if I could, I guess a question on guidance, but more from a philosophical perspective, I mean, given the CEO search, as you mentioned, being still underway, and a transition anticipated. I guess, was there anything that was done differently in approaching the fiscal -- to fiscal '27 guidance formulation in terms of embedding just enough conservatism to make sure that you're setting up incoming leadership for success and avoiding a need to make additional changes in reinvestments from this new level is a fiscal '27 base, if you will? Linda Rendle: Yes, Steve. As we set this budget with our Board, we took the exact same principled approach we've taken every year, which is looking at the external factors, making the assumptions around what we expect from the consumer category and cost looking at the plans that we have and doing everything we can to strengthen them and then setting an appropriate and balanced outlook based off of those factors. So nothing else was taken into consideration. It was the same set of factors that we always consider. And from a management team and Board perspective, we are laser focused on executing that because that's the best way that we can set that up for a new CEO to come in, is to execute these plans we have, and we feel these plans are the right plans to continue to advance our categories and our share position within them. Operator: We'll move next to Lauren Lieberman with Barclays. Lauren Lieberman: Great. Just a quick ones, I know we've covered a lot of ground. SG&A drivers, I know you mentioned the incentive comp reset and then like sort of a structural increase from GOJO, but just Luc, how should we think about like comparable level of SG&A going forward? And then also, I don't -- I apologize if I missed it, but if there's been any conversation on beginning the ERP-enabled savings? I know you've talked about productivity as kind of the first line of defense versus inflation. But ERP-driven savings that may be starting to manifest in SG&A this year or also in logistics savings, another area we talked about is being subject to help with the new ERP. Luc Bellet: Yes. Thanks, Lauren. There's a lot going on in the SG&A line. So let me unpack it a little bit. The -- first and foremost, the 16% of sales includes about 40 basis points of negative impact from GOJO transaction-related costs, right, some onetime. So that, you're about 15.5%. Now as I mentioned, GOJO has a higher level of SG&A. And so that adds about 1 point also. And so excluding this, you get pretty close to where we finished the year. But keep in mind, this year, the -- actually, the incentive comp was quite significant. And so without going through the math, what I'll tell you is that the level of productivity next year more than offset the level of inflation. So we are making progress. Now we're not making step progress. There's 2 things. One, because the top line is fairly flat. You don't get the benefit of operating leverage. But most importantly, most of the initiatives that we talk about that are enabled by the ERP and further expansion in Global Business Services will start taking place, maybe starting late this year and most likely next fiscal year. Lauren Lieberman: Okay. Just so I can clarify that. Did you say that total productivity will be greater than inflation? Luc Bellet: That is correct. So we are actually -- on a comparable basis, we're actually making progress in SG&A next year. Lauren Lieberman: Okay. Net productivity statement, sorry, that was specific to SG&A, not gross margins as separate conversation. Luc Bellet: That is correct. Lauren Lieberman: Okay. And then since we're doing this, on the $200 million of inflation you mentioned, I just want to clarify what that covers? Is that just inputs, does that include logistics and transportation inflation as well or not? Luc Bellet: Yes, that's total inflation across supply chain, right? So commodities is going to be the majority of it. But as you mentioned, we're actually seeing pretty material inflation across different elements of logistics as an example, labor is actually not as much of a driver next year. Lauren Lieberman: Okay. Great. And then actually just one last minor thing. Interest expense for 2027, I'm guessing that's north of $200 million. Is that right? Luc Bellet: Yes, that's right. Right now, it's about $210 million. Operator: Your next question comes from Nik Modi with RBC Capital Markets. Unknown Analyst: This is Clark for Nik Modi. Ranch saw an uplift in demand and consumer engagement during the World Cup, as you noted in your prepared remarks, what type of capabilities do you have in place to monitor these trends? And how do you plan on leveraging this momentum to drive further growth for Hidden Valley Ranch? Linda Rendle: Sure. Clark, it was an exciting moment, I think, for everyone around the world with the World Cup. And of course, an exciting moment for our company was the love that international visitors experienced when they tried Ranch for the first time. That is an American staple and not available in many other countries. And the team was prepared that this could be a moment and took full advantage of it. So we worked with our retail partners to ensure that they were putting ranch out in front, given visitors were wanting to try it and giving incented consumers in the United States to remind them to use it. We did the largest sampling program that we've ever done once we started to see the impact. We got to many of the quarter final semis and finals games and did the largest sampling program with our dry product, which allowed those consumers to take it back home with them if they wanted to. And then, of course, we captured a lot of attention on social media as we talk about the love that Ranch was getting and turning that again into sales. I think the important part here is, one, we have a superior product that consumers love and we continue to invest in that product. We will continue to invest in it in fiscal year '27. We have a very strong slate of innovation that is targeted at consumers who are thinking about wellness. And there's a number of innovations we have, whether that be avocado oil, et cetera, that are focused on that trend. We ensured that we got price pack architecture right for those consumers that are value stretched. And so we have focused some smaller sizes and larger sizes and getting that distribution right, and we will see that play into '27. And then given the love and attention, we continue our social campaigns to remind consumers of all the great ways to use ranch to make their at-home meals even better, and we're seeing strong consumer reaction to that as well. So I feel good about the progress, feel good about the moment that we took advantage of, but this was much broader than a moment. It was taking our full capabilities to bear and building a stronger plan for '27. Operator: We'll move next to Priya Ohri-Gupta with Barclays Capital. Priya Ohri-Gupta: I was just wondering if you could address how you plan to think... Lisah Burhan: Priya? Priya Ohri-Gupta: Yes, notes that you have outstanding. Should we expect those to get refinanced? Linda Rendle: I think we lost you a little bit. Do you mind repeating your question? Priya Ohri-Gupta: Sorry about that. I just wanted to see if we should expect you to refinance the short-term and CP balance that you have outstanding? Luc Bellet: Priya, we don't have any plan for the moment. Actually, just the way we structured the debt is to ensure that we would actually repay those with the free cash flow that we'll generate over the next 12 to 18 months. Now we do have some maturity coming up. And so that will be -- that will give us an opportunity to just reassess the debt structure going forward in next calendar year. Operator: And this concludes the question-and-answer session. Ms. Rendle, I'd like to turn the program back to you. Linda Rendle: Thanks, Jen. I will close by saying we're entering fiscal year 2027 from a stronger position than we started fiscal year 2026, and we expect that momentum to continue building as we move through the year. With our ERP implementation complete, we're focused on optimizing the platform, unlocking productivity and realizing the benefits of that investment. At the same time, we're continuing to advance our long-term strategy, sustain our always on transformation agenda, and take the necessary targeted short- and medium-term actions to strengthen superiority. The acquisition of GOJO further strengthens our foundation by expanding our health and hygiene platform, bringing the Pure brand into our portfolio and creating new opportunities to serve consumers and professional customers with a more complete set of trusted hygiene solutions. Combined with the investments we've made in our business over the last several years, these actions give us confidence in our ability to accelerate category and market share growth, expand profitability and create long-term shareholder value. Thank you for your time and questions today. We look forward to updating you on our progress next quarter. Operator: This concludes today's conference call. Thank you for attending. Before you buy stock in Clorox, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Clorox wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $411,427!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,335,252!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 11, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Clorox (CLX) Q4 2026 Earnings Call Transcript was originally published by The Motley Fool

Get insights on thousands of stocks from the global community of over 7 million individual investors at Simply Wall St. Clorox (NYSE:CLX) outlined its fiscal 2027 outlook, highlighting ongoing operational headwinds and inflation risks. The company is forecasting net sales growth of 13% to 14% for fiscal 2027, largely tied to the acquisition of GOJO Industries and the Purell brand. Clorox reported fiscal 2026 results that were in line with prior expectations and used the update to detail how the GOJO and Purell integration could affect future revenue and earnings. Clorox enters this update with the stock trading around $104.67 and recent performance showing mixed signals. The share price is up 4.3% over the past week and 7.6% over the past month, while the stock is up 3.8% year to date. Over longer periods, the stock has declined 12.7% over the past year and has fallen more than 25% over both three and five years. For investors tracking NYSE:CLX, the focus now shifts to how the GOJO and Purell acquisition shapes the company’s revenue mix and operating profile in fiscal 2027 and beyond. Management is planning for persistent inflation and shifts in consumer behavior, which could keep cost pressures and demand patterns in focus. The combination of these challenges with higher expected net sales growth marks a new phase in Clorox’s story that warrants closer monitoring. Stay updated on the most important news stories for Clorox by adding it to your watchlist or portfolio. Alternatively, explore our Community to discover new perspectives on Clorox. We've flagged 2 risks for Clorox. See which could impact your investment. ⚖️ Price vs Analyst Target: Clorox trades at US$104.67, which is about 2.9% above the analyst price target of US$101.71. ✅ Simply Wall St Valuation: The stock is flagged as undervalued, trading about 56.2% below the estimated fair value. ✅ Recent Momentum: The 30-day return is 7.6%, which signals positive short term momentum into the fiscal 2027 outlook. There's only one way to know the right time to buy, sell or hold Clorox. Head to Simply Wall St's company report for the latest analysis of Clorox's Fair Value. 📊 The GOJO and Purell acquisition is central to Clorox’s projected 13% to 14% net sales growth for fiscal 2027, so integration progress is critical. 📊 Watch how operating margins, cash flow and P/E of 21.6 evolve as inflation and acquisition related costs flow through results. ⚠️ Debt coverage by operating cash flow and dividend coverage by free cash flow are identified risks that matter more as Clorox absorbs GOJO. For the full picture including more risks and rewards, check out the complete Clorox analysis. Alternatively, you can check out the community page for Clorox to see how other investors believe this latest news will impact the company's narrative. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include CLX. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Clorox projected a difficult fiscal year 2027 on Monday, warning that inflation and consumers focused on value would offset recent cost savings. The Oakland, California-based company expects net sales to rise 13% to 14% for the current fiscal year, with roughly 9.5 percentage points of that growth coming from its acquisition of GOJO Industries, the maker of Purell hand sanitizer. On an adjusted basis, Clorox forecast earnings per share of $5.70 to $6.00 for fiscal 2027, representing growth of 3% to 8% over the prior year. Diluted earnings per share on a GAAP basis are expected to land between $5.41 and $5.71. "We expect the operating environment to remain challenging, with continued cost volatility and a value-seeking consumer," Chair and CEO Linda Rendle said in a statement. Gross margin for fiscal 2027 is expected to come in at roughly 42%, as higher-than-normal inflationary headwinds and unfavorable product mix are projected to more than offset cost savings, the company said. The forecast followed fourth-quarter results that Clorox described as in line with its expectations. For the quarter ended June 30, the company earned $163 million, or $1.34 per diluted share, down from $332 million, or $2.68 per share, in the same period a year ago. Revenue fell 2% to $1.95 billion. Adjusted earnings per share were $1.66. Organic sales — which strip out the impact of acquisitions, divestitures, and currency movements — were down 13% in the quarter, a result the company attributed primarily to a one-time comparison effect. In the fourth quarter of fiscal 2025, retailers had placed advance orders ahead of the company's U.S. enterprise resource planning system transition, inflating the year-ago base by roughly 13.5 percentage points. For the full fiscal year 2026, net sales fell 5% to $6.72 billion, and adjusted EPS declined 28% to $5.53 from $7.72. The ERP-related inventory drawdown reduced full-year adjusted EPS by roughly 90 cents, the company said. Clorox completed the acquisition of GOJO Industries in April 2026, adding the Purell brand and a portfolio of health and hygiene products. The company said its global health and hygiene portfolio now represents more than half of net sales. For fiscal 2027, organic sales are expected to grow approximately 3.5% to 4.5%, with more than 3.5 percentage points of that growth coming from lapping the prior year's ERP-related inventory drawdown, the company said.

Interested in The Clorox Company? Here are five stocks we like better. Fiscal 2027 outlook: Clorox expects organic sales to be flat to slightly higher amid muted category growth and value-focused consumers, while targeting continued market-share gains. The first quarter may be weaker due to Kingsford timing and promotions. Inflation and margins: The company anticipates more than $200 million in fiscal 2027 supply-chain inflation, which it plans to offset primarily through productivity, selective pricing and revenue-management actions. Gross-margin recovery is expected in the second half, but not a full-year recovery. Transformation and growth initiatives: GOJO, including Purell, is integrating ahead of plan and is expected to be accretive to adjusted EPS in fiscal 2027, while the completed ERP implementation should generate supply-chain and administrative benefits. Clorox continues working to revive its Fresh Step litter business and remains committed to its dividend. 5 High-Yield Stocks That Could Help Cushion Market Volatility Clorox (NYSE:CLX) said it is entering fiscal 2027 with improving market-share trends, a completed enterprise resource planning implementation and a plan to offset more than $200 million in expected supply-chain inflation through productivity initiatives and targeted pricing. Chair and CEO Linda Rendle said the company operated through fiscal 2026 in an environment marked by value-seeking consumers, heightened competition, inflation and macroeconomic uncertainty. Clorox has responded by adjusting product offerings, price-pack architecture, promotions, brand investment and distribution, while continuing its broader operational transformation. → Lost in Space: Why Aerospace Valuations Are Plummeting Right Now 3 Defensive Stocks to Buy as Economic Uncertainty Lingers “While the majority of our businesses are performing at or above expectations, we have taken decisive actions to improve in the areas that are not yet delivering what we expect,” Rendle said. She said the company saw sequential improvement in consumption and market share during fiscal 2026, with consumption returning to flat in the fourth quarter and aggregate share down only one-tenth of a percentage point. Rendle said Clorox expects category growth to remain muted in fiscal 2027, broadly consistent with fiscal 2026, as consumers continue seeking value. The company’s outlook assumes continuity in category conditions and does not contemplate significant disruption from inflation or geopolitical developments. → MarketBeat Week in Review – 07/27- 07/31 3 Dividend Stocks Raising Payouts—and Backing It Up With Results Clorox expects organic sales to be flat to slightly higher for the year, with a slower first quarter primarily due to timing effects in Kingsford grilling products and promotions. Rendle described the first-quarter impact as a “blip,” saying the rest of the year, particularly the back half, should more closely resemble fiscal 2026 trends. Kingsford faced a difficult grilling season as weather affected key holidays. Rendle said Memorial Day was unusually cool and wet across much of the U.S., while widespread heat advisories during the July 4 weekend discouraged grilling. Retailers also emphasized smaller sizes on promotion to appeal to value-oriented shoppers. Clorox plans to adjust its merchandising approach next season by encouraging earlier seasonal purchases. → GE HealthCare Stock Climbs on Vital Diagnostics Demand Management expects to continue improving market share in fiscal 2027. Rendle highlighted eight consecutive quarters of share growth in home care, as well as continued share gains in professional and international businesses. The company also cited improving results in Glad and Hidden Valley Ranch, while identifying litter and Kingsford as areas where further progress is needed. CFO Luc Bellet said Clorox expects fiscal 2027 inflation of more than $200 million, more than double the company’s historical range of $75 million to $100 million. The outlook assumes Brent crude oil averages about $90 a barrel and includes cost pressures beyond commodities, including supplier costs, ocean freight, trucking and other logistics expenses. Bellet said inflation is expected to be more pronounced in the first half of the fiscal year. Productivity will be the company’s primary offset, supplemented by selective pricing and other revenue-management actions. Clorox expects to begin recovering gross margin in the second half, although it does not expect to fully recover margin for the full year. The company expects to exit fiscal 2027 with a stronger gross margin. Rendle said Clorox is taking a more selective approach to pricing than in prior inflationary periods, following several substantial price increases during 2022 and 2023. The company is implementing a regular price increase in Glad trash because of that category’s resin exposure, while using targeted pricing elsewhere in the portfolio. “Pricing is only one tool in the toolbox,” Rendle said, pointing to revenue growth management, price-pack architecture, cost savings and innovation as additional levers. She said management does not see a structural loss of pricing power in its categories, but views the current environment as unusual because it follows back-to-back inflation cycles and pressure on consumer budgets. Management said the integration of GOJO, which brings the Purell brand into Clorox’s portfolio, is proceeding as planned and in some areas ahead of plan. Rendle said the business performed ahead of its fourth-quarter targets, while Bellet said GOJO was accretive rather than dilutive to adjusted earnings per share in the quarter. Bellet said GOJO is expected to be accretive to adjusted EPS in fiscal 2027 and is expected to grow at a mid-single-digit rate before potential revenue synergies. As those synergies are realized, management expects growth in the business could reach the mid- to high-single digits for several years. The CFO also noted that GOJO’s business-to-business model has a different profit-and-loss profile than Clorox’s legacy operations, including lower advertising spending as a percentage of sales and higher selling, general and administrative expenses. Clorox completed its ERP implementation and is now focused on stabilizing and optimizing the system. Bellet said the company expects supply-chain and administrative benefits to build later in fiscal 2027 and into the following year. Potential benefits include improved planning, lower inventory, automation, more responsive demand fulfillment and increased use of global business services. Rendle said litter remains the company’s principal work in progress following the cyberattack and operational disruptions of prior years. The company has restored lost distribution, but is continuing to overhaul the Fresh Step brand through product improvements, packaging changes, marketing, e-commerce upgrades and targeted pricing. Clorox reduced dust in certain Fresh Step products, expanded investment in lightweight litter and changed packaging and marketing. Rendle said more innovation is planned for the back half of fiscal 2027, though she cautioned that rebuilding consumer awareness, repeat purchases and category momentum will take time. Rendle also provided an update on Clorox’s CEO succession process. She previously informed the board of her intention to step down due to personal health challenges. She said she is cancer-free, feels well and remains focused on running the company. The board has hired an external search firm and the process is progressing according to its expected timeline. Clorox expects fiscal 2027 free cash flow to remain within its targeted range of 11% to 13% of sales. Bellet said the company remains committed to its dividend, describing the currently elevated payout ratio as transitory while gross margins rebuild. The Clorox Company is a leading manufacturer and marketer of consumer and professional products designed to help people care for their homes and live healthy, sustainable lives. Its portfolio spans cleaning and household products, food and beverages, water filtration systems and cat litter, serving both retail and institutional customers. The company's flagship bleach and disinfecting products are well known in the United States and many international markets, where they help prevent the spread of germs in homes, hospitals, schools and businesses. Clorox's diverse brand lineup includes liquid bleach and surface cleaners, eco-friendly cleaning tools, food preservation and preparation items, charcoal grills and briquettes, specialty foods and beverages, pet care products and personal care lines. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Clorox Q4 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management attributed fiscal 2026 performance to a dynamic environment of value-seeking consumer behavior and inflationary pressures, necessitating urgent short-term actions to sharpen product experiences. The company has largely moved past the operational 'hangover' from the prior cyberattack, having restored distribution and fundamentals across most categories, with Litter being the notable exception still in recovery. Strategic positioning is being bolstered by the GOJO acquisition, which management views as a key driver for expanding the health and hygiene platform and capturing B2B revenue synergies. Performance in the Home Care and Pro segments remained strong with eight consecutive quarters of share growth, while turnarounds in Glad and Hidden Valley Ranch were driven by reinvestment in superiority and price pack architecture. The 'always-on' transformation agenda is shifting focus from ERP implementation stabilization to optimizing the platform for productivity and end-to-end data visibility. Management emphasized a 'superiority model' focusing on five levers—product, package, proposition, place, and price—to combat muted category growth and competitive activity. Fiscal 2027 guidance assumes a 'blip' in Q1 due to timing issues in the Grilling business and promotional shifts, with sequential improvement expected in the back half of the year. The outlook assumes persistent inflationary pressures of over $200 million, more than double the historical range, driven by commodities and broader supply chain costs like ocean freight. Management expects to continue making market share progress through a doubled innovation rate and targeted pricing actions, specifically a straight price increase in the Glad category. Financial assumptions include Brent crude oil averaging $90 per barrel and interest expense reaching approximately $210 million. The company anticipates returning to a free cash flow generation range of 11% to 13% of sales, supported by working capital discipline and tax benefits from the GOJO acquisition. The GOJO acquisition introduces a different P&L profile, including a 0.5 point dilution to gross margin and lower advertising spend as a percentage of sales compared to legacy Clorox. Weather-related volatility remains a significant risk factor for the Kingsford business, as seen in the recent category decline during major summer holidays. The CEO transition process is underway following Linda Rendle's intent to step down for personal health reasons, with an external search firm currently evaluating candidates. Incentive compensation is expected to reset to higher levels in fiscal 2027, creating a year-over-year headwind for SG&A expenses. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management remains committed to the dividend, viewing the current high payout ratio as transitory while gross margins are rebuilt. The Board conducts regular reviews but currently feels comfortable with the dividend level due to strong free cash flow generation. Linda Rendle stated there is no structural issue with pricing power, but the company is being more 'targeted' given the proximity of back-to-back inflation cycles. The strategy relies on a 'toolbox' approach, using revenue growth management and price pack architecture alongside straight price increases where warranted by commodities. Efficiency benefits from the new ERP system are expected to ramp up late in fiscal 2027 and into fiscal 2028 as the company moves from stabilization to optimization. The system is expected to enable better supply chain planning, lower inventory levels, and the expansion of Global Business Services for back-office automation. Management acknowledged Litter is in the 'early innings' of a turnaround, requiring an overhaul of product dust levels and a stronger presence in the lightweight segment. A new slate of innovation for the category is scheduled for launch in the back half of fiscal 2027 to drive category growth and repeat purchases.

The Clorox Company CLX framed fiscal 2027 as a year of better execution but continued pressure. ERP comparisons and GOJO should lift reported growth, while value-seeking consumers, muted categories and elevated costs constrain the underlying outlook. Adjusted earnings of $1.66 per share beat the Zacks Consensus Estimate of $1.64. Revenues of $1.95 billion also surpassed the $1.91 billion consensus, but management focused on rebuilding share and margins. The Clorox Company price-consensus-eps-surprise-chart | The Clorox Company Quote Fiscal 2027 net sales are projected to rise 13% to 14%, including about 9.5 points from GOJO. Organic sales are expected to grow 3.5% to 4.5%, with more than 3.5 points from lapping the prior-year ERP inventory drawdown. Chair and chief executive officer Linda Rendle said the outlook assumes muted categories and continued value seeking. A slower first quarter should mainly reflect Kingsford and promotional timing, followed by improved trends later in the year. Chief financial officer Luc Bellet guided adjusted earnings to $5.7 to $6 per share, growth of 3% to 8%. The range includes the ERP comparison benefit. Bellet expects fiscal 2027 inflation above $200 million, more than double the historical range of $75 million to $100 million. The outlook assumes Brent crude averaging about $90 per barrel. Pressure also spans supplier costs, ocean freight, trucking and other logistics expenses. Bellet expects the inflation impact to be heavier in the first half. Gross margin is projected at about 42%. Productivity remains the primary offset, with margin recovery expected in the back half but not enough for a full-year recovery. A BNP Paribas analyst questioned whether household categories had lost pricing power. Rendle rejected a structural change, but said Clorox is using targeted pricing after four substantial rounds in the prior inflation cycle. Glad is taking a regular price increase because of resin exposure. Elsewhere, management is leaning more on revenue growth management, price-pack architecture, promotion and innovation. Bellet confirmed positive pricing and negative volume are embedded in the outlook. An Evercore ISI analyst asked whether pricing could disrupt share gains. Rendle said Clorox will use improved data to monitor results and adjust where needed, while promotions remain elevated near pre-COVID levels. A JPMorgan analyst asked about GOJO’s performance and integration. Rendle said the business exceeded fourth-quarter targets, with integration proceeding as planned and in some areas slightly ahead. Bellet said GOJO was accretive rather than dilutive in the quarter and should remain accretive to adjusted earnings in fiscal 2027. He expects mid-single-digit growth, rising to mid- to high-single digits as revenue synergies develop. GOJO also changes the profit mix. Bellet cited about half a point of gross-margin dilution, less than one point of additional SG&A and roughly one point less advertising than the legacy business. A TD Cowen analyst asked when the completed ERP program would produce visible benefits. Bellet said Clorox remains in stabilization mode, with broader optimization expected later in fiscal 2027 and into the following year. Management is seeing better end-to-end data, more responsive demand planning and efficiencies in fulfillment and order-to-cash processes. Greater back-office automation and global business services should follow. Bellet said comparable SG&A productivity should exceed inflation in fiscal 2027. Larger ERP-enabled savings are weighted toward later periods. Rendle highlighted share progress in Home Care, Professional and International, along with turnarounds in Glad and Hidden Valley Ranch. Fresh Step remains an early-stage repair effort spanning product, packaging, pricing, e-commerce and back-half innovation. Management’s closing message centered on improving value superiority, converting ERP investment into productivity, integrating GOJO and restoring profitable growth amid persistent consumer and cost pressure. CLX carries a Zacks Rank #4 (Sell), reflecting unfavorable earnings estimate revisions. Its Value Score is C, Growth Score is F, Momentum Score is B and VGM Score is D, making momentum its strongest current style characteristic. The B Momentum Score is favorable within that style, but the weak Growth and VGM readings do not offset the Zacks Rank, which favors Rank #1 (Strong Buy) or 2 (Buy) stocks paired with A or B Style Scores. The Zacks Rank can change as analyst estimates are revised after the reported results. You can see the complete list of today’s Zacks #1 Rank stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Clorox Company (CLX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

The Clorox Company CLX delivered mixed fourth-quarter fiscal 2026 results, with the top and bottom lines surpassing the Zacks Consensus Estimate. However, sales and earnings per share declined year over year due to unfavorable comparison with ERP-related shipments in the prior-year quarter, lower volume and significant gross margin pressure from higher commodity, manufacturing and logistics costs.Shares of the Zacks Rank #4 (Sell) company have rallied 14.1% in the past three months compared with the industry’s 3.9% rise. Image Source: Zacks Investment Research Clorox posted adjusted earnings of $1.66 per share for the fourth quarter of fiscal 2026, falling 42% year over year but beating the Zacks Consensus Estimate of $1.64 by 1.2%. Lower sales and gross margin weighed on the bottom line.Net sales declined 2% to $1.95 billion but surpassed the consensus mark of $1.91 billion by 1.8%. The GOJO acquisition contributed about 10 percentage points to sales, while organic sales fell 13% due mainly to the ERP-related shipment comparison. The Clorox Company price-consensus-eps-surprise-chart | The Clorox Company Quote Gross profit declined 13% to $804 million from $924 million a year ago. The gross margin declined 520 basis points (bps) year over year to 41.3%. Lower volume, GOJO inventory step-up costs, higher commodity expenses, and elevated manufacturing and logistics costs more than offset savings initiatives.The comparison with incremental shipments ahead of the prior-year ERP transition reduced the margin by about 150 bps. The GOJO inventory step-up created another roughly 150-bps drag. The adjusted gross margin, excluding acquisition and integration costs, was 42.8%. Selling and administrative expenses increased 0.7% year over year to $298 million from $296 million in the year-ago quarter. These expenses represented 15.3% of net sales and included $21 million of GOJO integration costs.Advertising costs rose 26.3% year over year to $216 million from $171 million, and represented 11.1% of sales. Research and development expenses were unchanged at $32 million. Interest expenses increased sharply to $55 million from $22 million, reflecting the company’s higher debt burden. Health and Wellness sales increased 16% year over year to $860 million. The GOJO acquisition contributed about 28 percentage points to growth. Organic sales declined 12% because of the ERP-related shipment comparison, while segment adjusted EBIT fell 15% to $206 million.Household sales decreased 18% to $524 million, led by a 16-point volume decline and two points of unfavorable price mix. The decrease reflected the ERP comparison and shipments ahead of consumption in the fiscal third quarter. Segmental adjusted EBIT plunged 56% to $69 million amid lower sales and higher commodity costs.Lifestyle sales declined 17% year over year to $280 million. Volume fell 14 points, while unfavorable price mix reduced growth by another three points. Segment adjusted EBIT decreased 60% to $38 million, mainly because of lower revenues.International sales increased 4% to $281 million, primarily supported by favorable foreign exchange rates. Organic sales rose 1%. Segment adjusted EBIT advanced 17% to $27 million on higher sales and cost savings. Clorox completed the GOJO acquisition during the quarter, adding the Purell brand, and expanding its health and hygiene portfolio to more than half of the company's sales. Management noted that early performance from Clorox Professional and Purell supported the strategic rationale for the transaction.The company also completed its U.S. ERP implementation after a five-year digital transformation program. Management is shifting its focus from system stabilization to productivity improvements, cost removal and optimization.Glad Trash returned to market-share growth following stronger innovation, brand investment and revenue growth management. Hidden Valley Ranch also gained share, supported by increased media spending, price-pack initiatives and retail execution. Cat Litter remained challenged as Clorox worked through distribution, shelf execution and consumer adoption following a broad brand reset. For fiscal 2027, CLX expects net sales growth of 13-14%, including 9.5 percentage points from GOJO. Organic sales are projected to rise 3.5-4.5%, including more than 3.5 points of benefit from lapping the ERP-related inventory drawdown.The company expects a gross margin of 42%, as stronger-than-normal inflation and unfavorable mix are anticipated to more than offset cost savings. Selling and administrative expenses are projected at 16% of sales, while advertising spending is expected to be 10%.Adjusted earnings are forecast between $5.70 and $6.00 per share, implying growth of 3-8% year over year. Reported earnings are expected between $5.41 and $5.71 per share, including 29 cents of GOJO transaction-related costs. The fiscal 2026 operating cash flow decreased 38% year over year to $612 million due to the Glad Venture Agreement termination payment. Management expects the fiscal 2027 free cash flow to be 11-13% of net sales.Clorox ended fiscal 2026 with $143 million in cash and cash equivalents. Long-term debt rose to $3.98 billion from $2.48 billion a year earlier, while notes and loans payable increased to $1.09 billion from $4 million following the GOJO transaction. Some better-ranked stocks have been discussed below:Newell Brands Inc. NWL is a global manufacturer and marketer of consumer and commercial products, including Paper Mate, Sharpie, Dymo, EXPO, Parker, Oster, Rubbermaid, FoodSaver and Graco. At present, NWL sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.The Zacks Consensus Estimate for Newell Brands’ current fiscal-year sales implies growth of 1%, and earnings estimates suggest flat results from the year-ago reported figures. NWL delivered a trailing four-quarter earnings surprise of 40%, on average.Purple Innovation Inc. PRPL designs and manufactures products which include mattresses, pillows and cushions, using its patented Hyper-Elastic Polymer. PRPL currently carries a Zacks Rank #2 (Buy).The Zacks Consensus Estimate for Purple Innovation’s current fiscal-year sales implies a decline of 0.4% from the year-ago reported figure, while the same for earnings suggests growth of 13.5%. PRPL delivered a trailing four-quarter earnings surprise of 17.4%, on average.BBB Foods Inc. TBBB operates grocery retail stores principally in Mexico. It offers food products, drinks, hygiene and beauty products, home cleaning products, coffee, tea and substitutes, jellies and desserts, and baby and pet products. TBBB currently carries a Zacks Rank #2.The Zacks Consensus Estimate for BBB Foods’ current fiscal-year sales and earnings implies growth of 44.6% and 52.7%, respectively, from the year-ago actual. TBBB delivered a trailing four-quarter negative earnings surprise of 98.9%, on average. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Clorox Company (CLX) : Free Stock Analysis Report Newell Brands Inc. (NWL) : Free Stock Analysis Report PURPLE INNOVATION, INC. (PRPL) : Free Stock Analysis Report BBB Foods Inc. (TBBB) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research