01—Abstract
Summary
Summary of the 10-Q filed April 25, 2025. Cited figures are marked; the original filing is the authoritative source.
Colgate-Palmolive Company reported first-quarter 2025 results with a slight decrease in net sales to $4.911 billiona, down 3.1% from $5.065 billion in the prior year.
This decline was primarily driven by a 4.4% negative impact from foreign exchange and a 0.1% volume decrease, partially offset by a 1.5% increase in net selling prices. On an organic basis (excluding foreign exchange, acquisitions, and divestitures), net sales grew by 1.4%. Diluted earnings per share increased to $0.85b from $0.83 in the prior year, showing a positive trend despite top-line pressure.
The company experienced mixed performance across its segments, with Oral, Personal, and Home Care net sales decreasing 4.3%c (though organic sales grew 1.0%), while Hill's Pet Nutrition saw a 1.5% increase in net sales (with organic sales up 2.9%). The company highlighted improvements in gross profit margin to 60.8% from 60.0%, driven by cost savings, pricing actions, and favorable mix, which helped to offset increased raw and packaging material costs. Management indicated continued focus on organic sales growth, operational efficiencies, and capital allocation, including increased dividends and a new share repurchase program.
02—Key points
Key Highlights
- Net sales for the first quarter of 2025 were $4.911 billion, a decrease of 3.1% compared to $5.065 billion in the prior year, primarily due to foreign exchange impacts and slight volume declines.
- Organic sales grew by 1.4% for the quarter, indicating underlying business strength despite currency headwinds.
- Diluted earnings per share increased to $0.85 from $0.83 in the prior year's first quarter.
- Gross profit margin improved to 60.8% from 60.0% year-over-year, driven by cost savings initiatives and pricing strategies.
- Hill's Pet Nutrition segment demonstrated resilience with net sales up 1.5% and organic sales up 2.9%.
- The company announced a new $5 billion share repurchase program, replacing the previous one, and increased its quarterly common stock dividend to $0.52 per share.
- The company is managing significant global economic challenges including inflation, high interest rates, and geopolitical tensions which are impacting operations and consumer demand.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2025, Colgate-Palmolive kept $0.14.
- Revenue$4.91B100.0%
- Cost of revenue−$1.92B39.2%
- Gross profit$2.99B60.8%
- Operating costs−$1.91B38.9%
- Operating income$1.08B21.9%
- Interest, other & tax−$386.0M7.9%
- Net income$690.0M14.1%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2025filed April 25, 2025Financial Statements
Q1 FY2025 against Q1 FY2024
| Line item | Q1 FY2025Q1 FY2024 | Change |
|---|---|---|
| Revenue | $4.91B$5.07B | −3.0% |
| Cost of Revenue | $1.92B$2.03B | −5.0% |
| Gross Profit | $2.99B$3.04B | −1.7% |
| SG&A Expenses | $1.90B$1.92B | −0.9% |
| Operating Income | $1.08B$1.05B | +2.8% |
| Net Income | $690.00M$683.00M | +1.0% |
| EPS (Basic) | $0.85$0.83 | +2.4% |
| EPS (Diluted) | $0.85$0.83 | +2.4% |
| Shares Outstanding (Basic) | 812.00M822.80M | −1.3% |
| Shares Outstanding (Diluted) | 815.00M825.90M | −1.3% |
05—Questions
Frequently Asked Questions
What were the primary drivers of the net sales decrease in the first quarter of 2025?
The primary drivers for the 3.1% decrease in net sales were a 4.4% negative impact from foreign exchange and a 0.1% decline in volume. This was partially offset by a 1.5% increase in net selling prices.
How did the different business segments perform?
The Oral, Personal, and Home Care segment saw net sales decrease by 4.3% (though organic sales grew 1.0%), while the Hill's Pet Nutrition segment showed growth with net sales up 1.5% and organic sales up 2.9%.
What is the outlook on profitability and shareholder returns?
Profitability showed improvement with a higher gross profit margin (60.8% vs. 60.0%) due to cost efficiencies and pricing. The company also increased its quarterly dividend to $0.52 per share and announced a new $5 billion share repurchase program, signaling confidence in future cash generation and a commitment to returning capital to shareholders.
What are the key risks and challenges the company faces?
Colgate-Palmolive faces challenges from global macroeconomic conditions including inflation, high interest rates, foreign currency volatility, geopolitical tensions (such as the war in Ukraine and conflict in the Middle East), and evolving trade relations. These factors can impact costs, consumer demand, and supply chains.
06—Continue