Core Insights - The company has advanced its 'Three-S' strategic plan (Stabilize, Streamline, and Strengthen) through the sale of its Dermacosmetics business, scaling its global operating growth model, and enhancing brand building capabilities, which are yielding positive results [1][6][8] - The company reaffirms its full-year 2025 adjusted EPS target range of $2.90 to $3.10 despite challenging market consumption trends [1][39] Financial Performance - Second Quarter 2025 net sales were $1.06 billion, a decrease of 0.9% year-over-year, impacted by divestitures and exited products [7][13] - Reported operating income was $45 million, compared to a loss of $27 million in the prior year, while adjusted operating income decreased by 2.9% to $135 million [7][17] - Diluted EPS improved to $0.00 from $(0.77) in the prior year, with adjusted EPS at $0.57, reflecting a 7.5% increase [19][12] Segment Performance - Consumer Self-Care Americas (CSCA) net sales were $622 million, down 1.9%, with growth in Nutrition and Upper Respiratory categories offset by declines in Digestive Health and Oral Care [21][22] - Consumer Self-Care International (CSCI) net sales increased by 0.7% to $434 million, driven by Pain & Sleep Aids and Upper Respiratory categories, despite a negative impact from divestitures [27][28] Strategic Initiatives - Project Energize, launched in Q1 2024, aims to enhance organizational agility and is expected to deliver annualized pre-tax savings of $140 million to $170 million by the end of 2026 [9][10] - The company anticipates that the sale of the Dermacosmetics business will strengthen its balance sheet and accelerate net leverage goals [8][39] Cash Flow and Balance Sheet - Year-to-date operating cash flow was $11 million, with cash inflow of $76 million in Q2 2025, and cash and cash equivalents on the balance sheet were $454 million as of June 28, 2025 [33][34] - Total debt on the balance sheet was $3.65 billion [34] Market Outlook - The company expects reported and organic net sales growth to be towards the lower end of their respective ranges for 2025, primarily due to infant formula industry dynamics and challenging market consumption trends [39][44] - The company believes its unique business model and extensive product offerings position it well to adapt to changing consumer behaviors and market conditions [37][39]

Core Insights - The company advanced its 'Three-S' Plan to stabilize, streamline, and strengthen its operations, achieving strong first-quarter results driven by infant formula and OTC brands [1][4] - The fiscal year 2025 outlook for reported net sales growth has been widened to 0% to 3% from 1% to 3%, while reaffirming other financial targets including adjusted EPS [2][38] - The company is facing macroeconomic uncertainties, including tariffs, which are expected to impact costs, but it remains confident in its financial targets due to proactive measures [4][34] Financial Performance - First-quarter 2025 net sales were $1.04 billion, a decline of 3.5% year-over-year, primarily due to divested businesses and currency translation [8][11] - Adjusted diluted EPS increased by 106.9% to $0.60, driven by higher adjusted operating income and lower interest expenses [17][10] - Reported gross margin improved to 37.6%, up 450 basis points from the prior year, while adjusted gross margin expanded to 41.0% [14][10] Segment Performance - Consumer Self-Care Americas (CSCA) net sales decreased by 3.6% to $621 million, impacted by lost distribution of lower-margin products and lack of prior year benefits from new product launches [19][21] - Consumer Self-Care International (CSCI) net sales declined by 3.4% to $423 million, although organic net sales grew by 4.5% due to strong performance in specific categories [26][27] Strategic Initiatives - Project Energize aims to deliver annualized pre-tax savings of $140 million to $170 million by the end of 2026, with $40 million to $60 million expected to be reinvested [7][6] - The company has achieved gross annual savings of approximately $159 million since the program's inception, with restructuring charges of $111 million incurred [7][6] Cash Flow and Balance Sheet - First-quarter 2025 cash from operations was a loss of $65 million, primarily due to inventory rebuilding and restructuring costs [32] - As of March 29, 2025, cash and cash equivalents were $410 million, with total debt at $3.63 billion [33][50]