1. KMB's Q1 2025 net sales declined by 6.0% year-over-year. 2. Adjusted EPS fell 4.0% to $1.93 amid higher operational costs. 3. CEO remains confident in overcoming cost challenges and driving profitability. 4. Product innovations are aimed at gaining market share despite price declines. 5. 2025 outlook adjusted for geopolitical cost increases, targets flat operating profit.
KMB's sales and profit declines, along with increased costs, pressure profitability. Historically, similar declines caused stock price drops.
The article discusses KMB's financial performance, significant for investors. Its projected sales decline is of high concern for stock pricing.
Immediate cost pressures and declining sales suggest potential short-term stock volatility. These impacts may stabilize as cost management improves.
Results driven by strong in-market execution and effective cost management in dynamic operating environment. Full year outlook adjusted to reflect potential incremental costs from a more uncertain geopolitical landscape.
DALLAS, April 22, 2025 /PRNewswire/ -- Kimberly-Clark Corporation (NYSE: KMB) today reported first quarter 2025 results driven by resilient consumer demand, the introduction of pioneering innovative new products, and leveraging sustained productivity momentum.
"Building on the strong foundation we established in 2024, we made further progress across the three pillars of our Powering Care strategy in the first quarter of 2025," said Kimberly-Clark Chairman and CEO, Mike Hsu. "Despite the evolving external landscape, our first quarter was consistent with our full-year plan."
Hsu continued, "At the same time, the current environment will now mean greater costs across our global supply chain versus our expectations at the beginning of the year. However, we remain confident in our ability to offset these costs over time and unlock our long-term potential."
Net sales of $4.8 billion were 6.0 percent lower than the prior year, including negative impacts of approximately 2.4 percent from foreign currency translation and approximately 2.0 percent from a combination of the PPE divestiture and the exit of the company's private label diaper business in the US. Organic sales decreased 1.6 percent driven by a 1.5 percent decrease in price while volume and mix were in line with a year ago.
Gross margin was 35.8 percent in the quarter, inclusive of $53 million, or approximately 110 basis points, of charges related to the 2024 Transformation Initiative. Excluding these charges, adjusted gross margin was 36.9 percent, down 20 basis points versus the prior year.
First quarter operating profit was $769 million compared to $853 million in the prior year. Operating profit in each period was inclusive of 2024 Transformation Initiative charges totaling $75 million and $45 million, respectively. Excluding these items, adjusted operating profit was $844 million, down 6.0 percent versus the prior year and inclusive of an unfavorable impact from currency translation of 2.2 percent.
Net interest expense was $57 million and in line with the prior year.
The first quarter effective tax rate was 23.8 percent, in line with the prior year. On an adjusted basis, the effective rate was 21.4 percent compared to 23.6 percent in the prior year. The first quarter of 2025 benefited from the resolution of certain tax matters.
| Business Segment | Net Sales Change % |
|---|---|
| Consolidated | (6.0) |
| North America (NA) | (3.9) |
| International Personal Care (IPC) | (8.9) |
| International Family Care & Professional (IFP) | (7.7) |
The company now expects its 2025 Adjusted Operating Profit to be flat to positive on a constant-currency basis versus the prior year.
Kimberly-Clark (NYSE: KMB) and its trusted brands are an indispensable part of life for people in more than 175 countries and territories. We are proud to be recognized as one of the World's Most Ethical Companies.
For further inquiries and updates, visit the Kimberly-Clark website.