Financial Data and Key Metrics Changes - The first quarter of fiscal 2026 saw organic sales growth of 2%, marking 40 consecutive quarters of organic sales growth and keeping the company on track for the 10th consecutive fiscal year of core EPS growth [3][4] - Core earnings per share (EPS) were $1.99, up 3% compared to the prior year, with core gross margin down 50 basis points and core operating margin equal to the prior year [7][19] - Adjusted free cash flow productivity was 102%, with $3.8 billion returned to shareholders, including $2.55 billion in dividends and $1.25 billion in share repurchases [7][20] Business Line Data and Key Metrics Changes - Skin and personal care led growth with high single-digit increases, while hair care, grooming, personal health care, home care, and baby care each grew low singles [4][5] - Oral care and feminine care were in line with the prior year, while fabric care and family care were down low single digits [4][5] - Six of seven regions held or grew organic sales, with North America up 1% and Latin America up 7% [6][19] Market Data and Key Metrics Changes - Global aggregate market share decreased by 30 basis points, with 24 of the top 50 category-country combinations holding or growing share [6][7] - Greater China organic sales grew 5%, with Pampers and SK-II each growing double digits [5][6] - European focus markets' organic sales were equal to the prior year, with strong growth in France and Spain offset by weaker performance in Germany and Italy [5][6] Company Strategy and Development Direction - The company is focusing on increased investment in its integrated growth strategy, emphasizing consumer-centric approaches and driving superiority across all product categories and retail channels [8][16] - A significant innovation program is underway, including the launch of Tide's biggest upgrade in 20 years and the introduction of Tide Evo, a new laundry detergent [9][10] - The company is actively managing its portfolio, including restructuring efforts to enhance efficiency and effectiveness, with plans to reduce up to 7,000 non-manufacturing roles [12][15] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging operating environment with heightened competitive activity in the U.S. and Europe, but expressed confidence in the company's strategy and its ability to drive market growth [16][19] - The company maintained its guidance for fiscal 2026, expecting organic sales growth in line to plus 4% and core EPS growth in line to plus 4% [17][19] - Management highlighted the importance of innovation and integrated superiority to navigate the competitive landscape and drive sustainable growth [18][19] Other Important Information - The company is experiencing a shift in consumer behavior, with a focus on value rather than affordability, leading to positive price mix dynamics [48][49] - The restructuring program aims to create a more agile organization and improve execution capabilities, with a focus on digital enablement and data-driven decision-making [15][27] Q&A Session Summary Question: How is the restructuring being received internally? - Management reported that the organization is adapting well to the restructuring, with clear plans in place to create a more agile and effective organization [24][25] Question: What is the competitive landscape in North America for fabric care and baby care? - Management noted heightened competitive activity, particularly in promotions, but emphasized the importance of innovation and integrated superiority to drive sustainable growth [30][31] Question: What are the implications of the global market share decline? - Management acknowledged the decline but pointed out that absolute share in the U.S. is improving, indicating a positive trend despite competitive pressures [38][39] Question: How is the company addressing consumer affordability? - Management clarified that value is central to the consumer equation, with a focus on integrated performance rather than just price [48][49] Question: What is the outlook for Greater China? - Management expressed confidence in the progress made in China, highlighting strong growth in key categories and the effectiveness of recent interventions [44][45]

Financial Data and Key Metrics Changes - Organic sales growth for the first quarter of fiscal 2026 was 2%, marking 40 consecutive quarters of organic sales growth [2][5] - Core earnings per share (EPS) increased by 3% year-over-year to $1.99, with a currency-neutral basis also reflecting a 3% increase [5] - Core gross margin decreased by 50 basis points, while core operating margin remained equal to the prior year [5] - Adjusted free cash flow productivity was reported at 102%, with $3.8 billion returned to shareholders, including $2.55 billion in dividends and $1.25 billion in share repurchases [5][19] Business Line Data and Key Metrics Changes - Skin and personal care led growth with high single-digit increases, while hair care, grooming, personal health care, home care, and baby care grew in low single digits [3][4] - Oral care and feminine care remained flat compared to the prior year, while fabric care and family care saw declines in low single digits [3] - In North America, organic sales were up 1%, with consumption decelerating throughout the quarter [3][4] Market Data and Key Metrics Changes - Organic sales in Greater China grew by 5%, with Pampers and SK-II each achieving double-digit growth [4] - Latin America saw organic sales increase by 7%, driven by strong growth in Mexico and Brazil [4] - Global aggregate market share decreased by 30 basis points, with 24 of the top 50 category-country combinations holding or growing share [4][5] Company Strategy and Development Direction - The company is focusing on increased investment in its integrated growth strategy, emphasizing consumer-centric approaches and innovation [6][15] - Plans include significant upgrades to core products, such as Tide's liquid detergent, and the introduction of new products like Tide Evo [8][10] - The restructuring program aims to enhance agility and efficiency, with a target of reducing up to 7,000 non-manufacturing roles [14][26] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging competitive environment, particularly in the U.S. and Europe, but expressed confidence in the company's strategy to drive growth [5][15] - The guidance for fiscal 2026 maintains organic sales growth expectations of 2% to 4%, with core EPS growth also projected in the same range [16][17] - Management highlighted the importance of innovation and integrated superiority to navigate the current market challenges [15][38] Other Important Information - The company is actively managing its portfolio to enhance dollar-based returns and has made strategic exits from underperforming categories in certain markets [12][73] - The company expects to return approximately $15 billion to shareholders in fiscal 2026, including $10 billion in dividends and $5 billion in share repurchases [19] Q&A Session Summary Question: How is the restructuring being received internally? - Management reported that the organization is adapting well to the restructuring, with clear plans in place for role reductions and organizational changes aimed at creating a more agile company [24][25] Question: What is the competitive landscape in North America for fabric care and baby care? - Management noted heightened competitive activity in both categories, with a focus on driving integrated superiority through innovation rather than just promotions [30][31] Question: What are the reasons for the decline in global market share? - Management indicated that the decline is influenced by increased promotional activity and competitive aggressiveness, particularly in the U.S. and Europe, but noted improvements in absolute share over recent months [36][38] Question: How is the company addressing consumer affordability? - Management emphasized that value, defined as price over integrated performance, is central to their strategy, with a focus on optimizing price points and product offerings across all tiers [50][51] Question: What is the outlook for the rest of the world, particularly in Western Europe and Latin America? - Management described Western Europe as having similar dynamics to North America, while Latin America continues to show strong growth, particularly in Brazil and Mexico [72][73]

Financial Data and Key Metrics Changes - Organic sales for fiscal year 2025 grew by 2%, with volume growth contributing 1% and price mix adding another 1% [11] - Core earnings per share (EPS) reached $6.83, up 4% year-over-year [14] - Core gross margin declined by 40 basis points, while core operating margin increased by 50 basis points [14] - Adjusted free cash flow productivity was 87%, with $16 billion returned to shareholders, including $10 billion in dividends and $6.5 billion in share repurchases [15] Business Line Data and Key Metrics Changes - Nine out of ten product categories experienced organic sales growth, with Family Care and Personal Healthcare growing in the low single digits [11] - Baby Care saw a decline in organic sales in the low singles [11] - E-commerce sales increased by 12%, now representing 19% of total company sales [12] Market Data and Key Metrics Changes - Focus markets grew organic sales by 2%, with North America up 2% and Europe focus markets up 3% [12] - Greater China organic sales were down 5% year-over-year but improved sequentially, growing 2% in the most recent quarter [12] - Enterprise markets grew by 2%, led by Latin America with 4% organic sales growth [12] Company Strategy and Development Direction - The company is focused on an integrated growth strategy that emphasizes balanced top and bottom line growth and value creation [7][25] - A restructuring program was announced to strengthen execution and improve organizational capabilities [39] - The company aims to capture significant growth opportunities in North America, Europe, and enterprise markets, with potential sales opportunities ranging from $5 billion to $15 billion [24][25] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging macroeconomic environment, including tariffs, inflation, and geopolitical dynamics, which have impacted category growth [23] - The company expects the market environment to remain volatile and challenging in fiscal year 2026, with guidance for organic sales growth in the range of flat to 4% [45][46] - Management emphasized the importance of creating "tailwinds" through innovation and strategic investments to drive growth [58] Other Important Information - The company plans to reduce up to 7,000 non-manufacturing roles, or roughly 15% of its current non-manufacturing workforce, as part of the restructuring efforts [42] - The transition of leadership from Jon Moeller to Shailesh Jujurukar is planned for January 1, 2026, with a focus on continuity and strategic execution [5][56] Q&A Session Summary Question: Insights on Shailesh's leadership and tailwind creation efforts - Management highlighted Shailesh's extensive experience and leadership capabilities as key to driving future growth and value creation [56][58] Question: Addressing the narrowing performance gap in North America - Management acknowledged the reduction in category growth rates and the need to regain superiority in certain categories to widen the performance gap [65][66] Question: Timing and impact of restructuring on organizational capabilities - Management explained that the restructuring aims to enhance decision-making and efficiency, leveraging technology to break down silos within the organization [81][84]

Financial Data and Key Metrics Changes - Organic sales for fiscal year 2025 grew by 2%, with volume growth contributing 1% and price mix adding another 1% [8][12] - Core earnings per share (EPS) reached $6.83, up 4% year-over-year [12][17] - Core gross margin declined by 40 basis points, while core operating margin increased by 50 basis points [12][18] - Adjusted free cash flow productivity was 87% for the year [13] Business Line Data and Key Metrics Changes - Nine out of ten product categories experienced organic sales growth, with Family Care and Personal Healthcare growing in the low single digits [9][10] - Baby Care saw a decline in organic sales in the low single digits [10] - E-commerce sales increased by 12%, now representing 19% of total company sales [10] Market Data and Key Metrics Changes - Focus markets grew organic sales by 2%, with North America and Europe focus markets up by 2% and 3% respectively [10] - Greater China organic sales were down 5% year-over-year but improved sequentially, growing 2% in the most recent quarter [10][15] - Enterprise markets grew by 2%, led by Latin America with 4% organic sales growth [10] Company Strategy and Development Direction - The company is focused on balanced top and bottom line growth, emphasizing the need for brands to lead market growth rather than just gaining market share [4][22] - A restructuring program was announced to strengthen execution of the integrated strategy, focusing on portfolio management, supply chain efficiency, and organizational design [20][35] - The company aims to create $10 billion to $15 billion in sales opportunities in enterprise markets by increasing per capita consumption [21] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging operating environment, including consumer anxiety due to tariffs, inflation, and geopolitical issues [20][42] - The company expects the market environment to remain volatile and challenging in fiscal year 2026, with guidance for organic sales growth in the range of flat to 4% [42][43] - Management emphasized the importance of creating internal tailwinds to drive growth despite external challenges [56] Other Important Information - The company plans to return approximately $15 billion to shareholders in fiscal year 2026 through dividends and share repurchases [47] - The transition of leadership to Shailesh Jujurukar as the new CEO is planned for January 1, 2026, with John Moeller moving to Executive Chairman [3][49] Q&A Session Summary Question: Insights on Shailesh's attributes and goals for the transition - Management highlighted Shailesh's extensive experience and successful leadership in key business areas as reasons for his selection as the next CEO [54][55] Question: Tailwind creation efforts for fiscal year 2026 - Management discussed the restructuring program as a means to build financial headroom for innovation and commercialization, aiming to create internal growth drivers [56][57] Question: Addressing the narrowing performance gap in North America - Management acknowledged the reduction in category growth rates and the need to regain superiority in certain categories to enhance growth [63][65] Question: Timing of the CEO change and organizational capabilities - The timing of the leadership transition was deemed appropriate given the company's strong performance and strategic positioning [78][79] - Management emphasized the importance of breaking down silos within the organization to enhance decision-making and efficiency [81][82]

Summary of Procter & Gamble Conference Call Company Overview - **Company**: Procter & Gamble (P&G) - **Event**: Deutsche Bank Global Consumer Conference Key Points Financial Performance - P&G achieved six consecutive years of 4% or better organic sales growth, with a 2% organic sales increase through March in fiscal year 2025, aligning with guidance [4][5] - Core EPS growth averaged nearly 8% over the past eight years, with a 3% growth in the first three quarters of fiscal year 2025, within the 2% to 4% guidance range [5][6] - Over three quarters, P&G returned more than $13 billion to shareholders through dividends and share repurchases, marking the 69th consecutive annual dividend increase [6] Market Challenges - Increased market volatility in fiscal year 2025, particularly in the U.S. and Europe, with growth rates slowing from around 4% to about 2% [7][8] - Ongoing geopolitical tensions, trade tariffs, and inflation are impacting consumer behavior and market dynamics [8][9] - Anticipated headwinds from tariffs estimated at approximately $600 million before tax for fiscal year 2026 [9] Growth Opportunities - Significant market potential identified in North America ($5 billion) and Europe ($10 billion) through increased household penetration of P&G brands [9][10] - Enterprise markets present a sales opportunity of $10 billion to $15 billion by driving per capita consumption to levels seen in Mexico [11][22] Strategic Initiatives - P&G is implementing a two-year non-core restructuring program focusing on portfolio choices, supply chain restructuring, and organizational design changes [13][15] - The restructuring program aims to reduce up to 7,000 non-manufacturing roles (approximately 15% of the workforce) and is expected to incur costs between $1 billion and $1.6 billion before tax [15][16] - Continued investment in innovation and productivity to enhance operational efficiency and support growth [12][19] Integrated Growth Strategy - P&G emphasizes the importance of delivering "irresistible superiority" across five vectors: product, package, brand communication, retail execution, and value [17][18] - Recent innovations include the launch of Oral B's advanced power toothbrush and Ariel's Big One Pods, which have contributed to market growth [27][30] - The company is leveraging digital tools and AI to enhance advertising effectiveness and optimize supply chain operations [36][38] Future Outlook - P&G expects market growth to stabilize at 3% to 4% over the next 12 to 18 months, despite current short-term volatility [61][62] - The focus remains on maximizing innovation and investment flexibility to navigate market uncertainties [65][66] - The majority of restructuring benefits are anticipated to materialize in fiscal year 2027 [67] M&A Strategy - P&G does not foresee the need for transformational M&A as part of its growth strategy, focusing instead on bolt-on acquisitions to enhance its existing portfolio [55][56] Additional Insights - The company is actively managing its portfolio, including exiting certain markets and divesting underperforming brands to focus on high-growth opportunities [11][12] - P&G's commitment to cash returns to shareholders remains strong, despite the restructuring efforts [16]

Financial Data and Key Metrics Changes - Organic sales for the quarter grew by 1%, with volume and mix in line with the prior year and pricing contributing an additional 1% to organic sales growth [5][11] - Core earnings per share (EPS) were $1.54, up 1% year-over-year, while on a currency-neutral basis, core EPS increased by 3% [11] - Core gross margin decreased by 30 basis points, while core operating margin increased by 90 basis points [11] Business Line Data and Key Metrics Changes - Personal Healthcare saw high single-digit growth, while Skin and Personal Care grew in the mid-single digits [6] - Fabric Care, Oral Care, Feminine Care, Grooming, and Hair Care were stable to up low single digits, whereas Family Care, Baby Care, and Home Care experienced low single-digit declines [6] - Organic sales in Focus Markets grew by 1%, while Enterprise Markets grew by 2% [7] Market Data and Key Metrics Changes - Organic sales in North America grew by 1%, a decline from the previous trend of 4% growth over the last five quarters [7] - In Europe, organic sales were up 1%, but France faced significant challenges with organic sales down in the high teens [9] - Greater China saw a 2% decline in organic sales, although SK II grew in double digits due to strong consumer response [9][66] Company Strategy and Development Direction - The company is focused on investing in long-term brand health, innovation, and demand creation despite near-term volatility [5][14] - The strategy emphasizes delivering superiority across all product categories and maintaining strong margin investment levels [15][16] - The company aims to mitigate cost and currency headwinds while driving margin expansion through productivity improvements [15][16] Management's Comments on Operating Environment and Future Outlook - Management noted that the operating environment remains volatile, with challenges from input costs, currencies, and geopolitical dynamics [24][30] - The company expects organic sales growth of approximately 2% for the fiscal year, with a range of 0.5% to 4.5% for the fourth quarter [24][25] - Management remains committed to innovation and investment to drive market growth and balanced growth in the long term [30][76] Other Important Information - The company returned nearly $3.8 billion to shareholders this quarter, including $2.4 billion in dividends and $1.4 billion in share repurchases [12] - The company announced a 5% increase in its dividend, marking the 69th consecutive annual dividend increase [12] Q&A Session Summary Question: Consumer behavior in the U.S. and Europe - Management acknowledged a slowdown in consumer takeaway and noted that U.S. consumer confidence metrics are weak, with a shift towards online and big box retailers [32][34] Question: Modeling for fiscal 2026 - Management indicated that global growth rates have decreased from 3.5% to 2.5%, but they expect markets to return to 3% to 4% growth in the mid-term [42][44] Question: Investment behind innovation - Management confirmed that investment levels in media and advertising remain flat as a percentage of sales, with a strong focus on supporting innovation [50][52] Question: Positioning against consumer trade down - Management believes the company is well-positioned to serve consumers across various price points and has a broad portfolio to address shifting consumer value equations [55][57] Question: Brand sentiment and market performance in China - Management reported no significant anti-American sentiment affecting brand performance, with SK II showing strong growth in China [63][66] Question: Tariff impacts and pricing strategies - Management discussed the estimated tariff impact of $1 billion to $1.5 billion before tax and emphasized the need for productivity and pricing strategies to mitigate these costs [98][102]