01—Abstract
Summary
Summary of the 10-Q filed August 1, 2025. Cited figures are marked; the original filing is the authoritative source.
Church & Dwight Co., Inc. (CHD) reported a slight year-over-year decrease in net sales for both the three-month and six-month periods ending June 30, 2025.
This was primarily driven by unfavorable pricing/product mix and the planned exit from certain businesses (Flawless, Spinbrush, Waterpik showerheads), partially offset by volume increases in some segments and strategic acquisitions. Gross profit and operating income saw more significant declines due to factors such as costs associated with business exits, higher manufacturing costs, and prior-year tariff refunds. Despite the revenue and profit pressures, the company made substantial progress on strategic initiatives, including the acquisition of Touchland Holding Corp. for $700 milliona and the refinancing of its credit facility to $2 billion.
The company also continued its share repurchase program, notably through an accelerated share repurchase of $300 millionb. Liquidity remains strong with significant cash and cash equivalents, and an available credit facility, positioning the company to manage its operations and strategic investments.
02—Key points
Key Highlights
- Net sales decreased by 0.3% to $1,506.3 million for the three months ended June 30, 2025, and by 1.4% to $2,973.4 million for the six months ended June 30, 2025, compared to the prior year periods.
- Gross profit decreased significantly due to costs associated with exiting Flawless, Spinbrush, and Waterpik showerhead businesses, prior-year tariff refunds, and higher manufacturing costs.
- Income from operations declined by 22.3% for the quarter and 13.2% for the six months, reflecting lower gross profit and increased SG&A expenses, partly due to business exit costs.
- The company completed the acquisition of Touchland Holding Corp for $700 million on July 16, 2025, expanding its personal care portfolio.
- A new $2.0 billion Credit Agreement was entered into on July 17, 2025, replacing the prior $1.5 billion facility, enhancing liquidity.
- Share repurchases remained active, with an accelerated share repurchase (ASR) contract for $300.0 million executed in May 2025.
- The company announced a strategic review of its vitamin business, considering options including divestiture.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2025, Church & Dwight Co Inc kept $0.13.
- Revenue$1.51B100.0%
- Cost of revenue−$859.3M57.0%
- Gross profit$647.0M43.0%
- Operating costs−$385.3M25.6%
- Operating income$261.7M17.4%
- Interest, other & tax−$70.7M4.7%
- Net income$191.0M12.7%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2025filed August 1, 2025Financial Statements
Q2 FY2025 against Q2 FY2024
| Line item | Q2 FY2025Q2 FY2024 | Change |
|---|---|---|
| Revenue | $1.51B$1.51B | −0.3% |
| Cost of Revenue | $859.30M$799.10M | +7.5% |
| Gross Profit | $647.00M$712.10M | −9.1% |
| R&D Expenses | $35.80M$33.00M | +8.5% |
| SG&A Expenses | $228.20M$222.80M | +2.4% |
| Operating Income | $261.70M$336.90M | −22.3% |
| Interest Expense | $23.50M$23.20M | +1.3% |
| Net Income | $191.00M$243.50M | −21.6% |
| EPS (Basic) | $0.78$1.00 | −22.0% |
| EPS (Diluted) | $0.78$0.99 | −21.2% |
| Shares Outstanding (Basic) | 244.70M244.30M | +0.2% |
| Shares Outstanding (Diluted) | 246.40M247.00M | −0.2% |
05—Questions
Frequently Asked Questions
What is the impact of the planned exit from the Flawless, Spinbrush, and Waterpik showerhead businesses on the company's financials?
The company recorded a pre-tax charge of $51.0 million in the second quarter of 2025 related to exiting these businesses. This charge included $30.4 million in Cost of Sales and $20.6 million in SG&A, impacting gross profit and operating income. The exit is expected to be completed by early 2026 and generated approximately $170 million in net sales in 2024.
How is the company managing the impact of tariffs and supply chain challenges?
The company is experiencing increased supply chain challenges and commodity cost volatility. They are taking strategic actions to mitigate tariffs, including shifting production, finding alternative supply sources, considering price increases, adjusting inventories, and lobbying for tariff exemptions. The projected twelve-month run-rate gross tariff costs are approximately $60.0 million, with efforts to reduce this exposure through supply chain and pricing strategies.
What is the financial impact of the recent Touchland acquisition?
On July 16, 2025, Church & Dwight acquired Touchland for $700.0 million, subject to adjustments. The acquisition is expected to expand the company's personal care offerings. The majority of the purchase price is anticipated to be allocated to the trade name. Contingent on 2025 net sales, additional earnout consideration of up to $180.0 million may be payable.
How has the company's liquidity and capital resources changed?
Liquidity remains strong. As of June 30, 2025, the company had $923.2 million in cash and cash equivalents and approximately $1,494.0 million available through its credit facilities and commercial paper program. The company entered into a new $2.0 billion Credit Agreement on July 17, 2025, which replaced its prior $1.5 billion facility, enhancing its borrowing capacity.
06—Continue