Delivers strong margin expansion and adjusted EPS growth for FY25 despite challenging environment in the second half of the fiscal year OAKLAND, Calif., July 31, 2025 /PRNewswire/ -- The Clorox Company (NYSE: CLX) today reported results for the fourth quarter and fiscal year 2025, which ended June 30, 2025.Fourth-Quarter Fiscal Year 2025 SummaryThe following is a summary of key fourth-quarter results, which reflect the temporary benefit from incremental shipments related to building retailer inventory in ad ...

Core Points - The Clorox Company has announced an increase in its quarterly dividend from $1.22 to $1.24 per share, payable on August 29, 2025, to shareholders of record as of August 13, 2025 [1] - Clorox has a long-standing commitment to providing value to its shareholders through regular dividend payments and annual increases [1] Company Overview - The Clorox Company, headquartered in Oakland, California, has been in operation since 1913 and is known for its trusted brands, including Brita®, Burt's Bees®, Clorox®, Fresh Step®, Glad®, Hidden Valley®, Kingsford®, Liquid-Plumr®, and Pine-Sol® [2] - The company has integrated sustainability into its business reporting and was ranked No. 1 on Barron's 100 Most Sustainable Companies list for the third consecutive year in 2025 [2]

Core Insights - Clorox (CLX) is expected to report quarterly earnings of $2.24 per share, a 23.1% increase year-over-year, with revenues projected at $1.93 billion, reflecting a 1.5% increase compared to the same period last year [1] Earnings Estimates - Over the past 30 days, the consensus EPS estimate has been revised downward by 3.2%, indicating a reassessment by analysts [2] - Changes in earnings estimates are crucial for predicting investor reactions, as empirical studies show a strong correlation between earnings estimate revisions and short-term stock performance [3] Revenue Projections - Analysts predict 'Net Revenue- Health and Wellness' at $692.86 million, a 6.3% increase year-over-year [5] - 'Net Revenue- International' is estimated to be $249.98 million, showing a decline of 7.8% year-over-year [5] - The consensus for 'Net Revenue- Lifestyle' stands at $349.59 million, indicating a 6.6% increase from the previous year [5] - 'Net Revenue- Household' is estimated at $626.55 million, reflecting a 5% increase year-over-year [6] Income Estimates - 'Income before income taxes- Health and Wellness' is expected to reach $219.10 million, up from $202.00 million year-over-year [7] - 'Income before income taxes- International' is projected at $21.21 million, compared to $18.00 million last year [7] - 'Income before income taxes- Lifestyle' is likely to be $71.73 million, an increase from $61.00 million in the same quarter last year [8] - 'Income before income taxes- Household' is estimated at $102.89 million, compared to $98.00 million year-over-year [8] Stock Performance - Clorox shares have increased by 2.8% over the past month, while the Zacks S&P 500 composite has risen by 3.4% [8] - Clorox holds a Zacks Rank 5 (Strong Sell), indicating expected underperformance relative to the overall market in the near term [8]

Core Insights - Clorox Company (CLX) is expected to report fiscal fourth-quarter 2025 earnings on July 31, with anticipated year-over-year growth in both revenue and earnings [1][8] - The Zacks Consensus Estimate for fourth-quarter revenues is $1.94 billion, reflecting a 2% increase from the prior year, while the earnings per share (EPS) estimate is $2.25, indicating a 23.6% increase year-over-year [2][8] - For fiscal 2025, the revenue estimate is $7.1 billion, a slight decline of 0.5% from the previous year, with EPS expected to rise by 14.9% to $7.09 [3][8] Financial Performance - Clorox has achieved its 10th consecutive quarter of gross margin growth, with a projected gross margin of around 44% for Q4, despite facing tariff-related costs and ERP transition expenses [5][6] - The adjusted operating profit for Q4 is predicted to increase by 27% year-over-year to $391.2 million, with an expected operating margin expansion of 400 basis points to 20.2% [6][8] Strategic Initiatives - The company is executing its IGNITE strategy, focusing on innovation and brand equity, which has led to successful premium product launches like Scentiva [4][8] - Clorox's operational efficiency and margin expansion strategies have helped mitigate cost pressures, allowing the company to maintain stability amid external challenges [5][8] Market Position - Clorox's international segment shows growth potential, with strong household penetration and premium positioning insulating the brand from significant trade-down behavior [7][8] - Despite a challenging macroeconomic environment, Clorox's brand portfolio and execution capabilities enable it to navigate market challenges more effectively than many competitors [7][8] Valuation and Stock Performance - Clorox stock is trading at a forward 12-month price-to-earnings ratio of 19.50x, below the industry average of 20.20x, indicating a potential valuation opportunity [11][8] - Year-to-date, Clorox has underperformed, with a decline of 21.6%, compared to a 2.4% decline in its industry and a 5.4% growth in the broader Consumer Staples sector [14][8]

Core Viewpoint - The market anticipates Clorox (CLX) will report a year-over-year increase in earnings driven by higher revenues when it releases its quarterly results for the period ending June 2025 [1][2]. Earnings Expectations - Clorox is expected to report quarterly earnings of $2.25 per share, reflecting a year-over-year increase of +23.6% [3]. - Revenues are projected to reach $1.94 billion, which is a 2% increase from the same quarter last year [3]. Estimate Revisions - The consensus EPS estimate has been revised 0.26% higher in the last 30 days, indicating a collective reassessment by analysts [4]. - However, the Most Accurate Estimate for Clorox is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -3.62%, suggesting a bearish outlook from analysts [12]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive or negative reading can predict the deviation of actual earnings from consensus estimates, but it is more reliable for positive readings [9][10]. - Clorox currently holds a Zacks Rank of 4, which complicates the prediction of an earnings beat [12]. Historical Performance - In the last reported quarter, Clorox was expected to post earnings of $1.57 per share but only achieved $1.45, resulting in a surprise of -7.64% [13]. - Over the past four quarters, Clorox has beaten consensus EPS estimates three times [14]. Industry Comparison - Procter & Gamble (PG), a competitor in the consumer products sector, is expected to report earnings of $1.43 per share for the same quarter, indicating a year-over-year change of +2.1% [18]. - P&G's revenues are anticipated to be $20.82 billion, up 1.4% from the previous year [18].

Core Viewpoint - Ahold NV (ADRNY) is currently viewed as a better investment opportunity compared to Clorox (CLX) based on various valuation metrics and analyst outlooks [1][3]. Valuation Metrics - Ahold NV has a forward P/E ratio of 13.29, while Clorox has a forward P/E of 20.07, indicating that Ahold NV is more undervalued at its current share price [5]. - The PEG ratio for Ahold NV is 1.65, compared to Clorox's PEG ratio of 3.41, suggesting Ahold NV has a more favorable earnings growth outlook relative to its valuation [5]. - Ahold NV's P/B ratio is 2.28, significantly lower than Clorox's P/B ratio of 84.19, further highlighting Ahold NV's relative undervaluation [6]. Analyst Ratings - Ahold NV holds a Zacks Rank of 1 (Strong Buy), indicating strong earnings estimate revision trends, while Clorox has a Zacks Rank of 4 (Sell), reflecting a less favorable analyst outlook [3][6]. - The Value grade for Ahold NV is A, whereas Clorox has a Value grade of D, reinforcing the perception that Ahold NV is the superior investment choice at this time [6].

Core Viewpoint - Clorox Company has filed a lawsuit against Cognizant Technology Solutions for gross negligence and breach of trust following a cyberattack that resulted in nearly $380 million in damages due to Cognizant's failure to adhere to cybersecurity protocols [1][5][6]. Group 1: Incident Overview - Clorox relied on Cognizant for operating its employee service desk, which included critical tasks like password recovery and credential resets for over a decade [2]. - On August 11, 2023, a cybercriminal gained direct access to Clorox's network credentials through the Cognizant-run service desk without proper authentication checks, which occurred multiple times [4]. - The cyberattack severely disrupted Clorox's corporate network and supply chain, impairing its ability to fulfill orders [5]. Group 2: Allegations Against Cognizant - Clorox alleges that Cognizant ignored established security procedures designed to prevent such attacks, leading to significant damages [5][6]. - The lawsuit claims that Cognizant's mishandling of credential requests was exacerbated by a poor incident response and disaster recovery effort [5]. - Despite claiming cybersecurity expertise and training for its staff, Cognizant's actions were described by Clorox as a "devastating lie," suggesting that the breach could have been avoided with proper adherence to protocols [6]. Group 3: Financial Impact - Clorox reported over $49 million in direct recovery costs and hundreds of millions more in business interruption losses due to the cyberattack [6]. - In contrast, Cognizant reported $20 billion in revenue for 2024, showing no immediate negative impact on its brand or financial performance [7].

Core Viewpoint - Clorox has filed a lawsuit against Cognizant, alleging negligence in handling a cyberattack that resulted in significant financial damages due to a breach by the hacking group Scattered Spider in August 2023 [1][2][4]. Group 1: Cyberattack Details - The cyberattack was executed by Scattered Spider, which is known for tricking IT help desks into providing access credentials [1][6]. - Clorox claims that the hacker gained access by simply requesting passwords from Cognizant's support staff without any sophisticated techniques [2][3]. - The lawsuit includes transcripts of conversations where Cognizant staff reset passwords without verifying the hacker's identity [4]. Group 2: Financial Impact - The total damages from the cyberattack are estimated at $380 million, with approximately $50 million attributed to remedial costs and the remainder due to Clorox's inability to ship products to retailers [4]. - Clorox's operational recovery was further complicated by Cognizant's failures, such as not deactivating certain accounts and improperly restoring data [5].

Core Insights - Clorox Company (CLX) is leveraging its pricing strength to drive growth and manage cost pressures effectively [1][10] - The company employs a dual pricing strategy, balancing affordability for consumers with profitability [2][10] - Clorox has achieved gross margin expansion for ten consecutive quarters, supported by disciplined pricing and cost-saving initiatives [3][5] Pricing Strategy - Clorox utilizes advanced analytics to identify price inflection points and selectively adjusts prices on value-sensitive SKUs while enhancing promotional support for higher-margin products [2] - The company is focused on premium pricing for its core brands, emphasizing premiumization and consumer value [1][10] - Clorox does not anticipate broad-based price increases but is evaluating specific adjustments in categories driven by value and innovation [4] Operational Efficiency - The company has improved efficiency across manufacturing and logistics, contributing to margin growth [4] - Recent divestitures of lower-margin operations, such as the VMS and Argentina businesses, have further supported margin expansion [4] - Clorox's streamlined operating model aims to enhance overall efficiency [3] Financial Performance - Clorox projects an adjusted EPS of $6.95-$7.35 for fiscal 2025, indicating a year-over-year increase of 13-19% [5] - The Zacks Consensus Estimate for fiscal 2025 earnings implies a growth of 14.9%, while a decline of 8.1% is expected for fiscal 2026 [15] - Clorox shares have declined by 21.5% year-to-date, compared to a 4.4% decline in the industry [13] Competitive Landscape - Major competitors in pricing strength include Colgate-Palmolive, Procter & Gamble, and Church & Dwight [6] - Colgate has seen a 1.5% improvement in pricing, with expectations of 2.5% growth in 2025 [7] - Procter & Gamble's pricing strategy focuses on value-based pricing to maintain market share and reduce reliance on discounts [8] - Church & Dwight has gained market share in nine of its 14 major brands, demonstrating solid brand performance [9]

Group 1 - The Clorox Company will announce its fourth-quarter and fiscal year 2025 results on July 31, 2025 [1] - The announcement will include a press release and prepared management remarks available on the company's website [3] - A live Q&A audio webcast for analysts will be held with the Chair and CEO Linda Rendle and Chief Financial Officer Luc Bellet [3] Group 2 - Clorox is headquartered in Oakland, California, and has been in operation since 1913 [2] - The company integrates ESG into its business reporting and was ranked No. 1 on Barron's 100 Most Sustainable Companies list for the third consecutive year in 2025 [2] - Clorox's trusted brands include Brita®, Burt's Bees®, Clorox®, Fresh Step®, Glad®, Hidden Valley®, Kingsford®, Liquid-Plumr®, and Pine-Sol®, along with international brands such as Clorinda®, Chux®, and Poett® [2]