01—Abstract
Summary
Summary of the 10-Q filed October 30, 2026. Cited figures are marked; the original filing is the authoritative source.
Kenvue Inc. reported third-quarter 2026 results for the fiscal three months ended September 27, 2026, with Net sales of $3,886 milliona, up 3.2% from $3,764 million a year earlier, and Net income of $430 million versus $398 million.
Organic sales rose 2.9%, driven by volume growth of 1.6% and value realization of 1.3%. For the fiscal nine months, Net sales were $11,750 millionb (up 3.6%) and Net income was $1,360 million (up from $1,140 million). Operating income rose to $706 million for the quarter from $629 million, though restructuring expenses fell to $33 million from $84 million and Pending Transaction and other related costs of $28 million were incurred.
The pending merger with Kimberly-Clark remains the central event. Under the Merger Agreement signed November 2, 2025, Kenvue shareholders will receive 0.14625 shares of K-C common stock plus $3.50c in cash per share, with current Kenvue shareholders expected to own about 46% of the combined company. Shareholders approved the deal on January 29, 2026, and the HSR waiting period expired February 4, 2026, but other customary closing conditions remain.
K-C commenced exchange offers for up to $7.0 billiond of Kenvue Senior Notes on September 28, 2026, and Kenvue entered into a supplemental indenture on October 9, 2026 to remove substantially all restrictive covenants once those offers settle. Balance sheet and cash flow metrics were stable. Cash and cash equivalents stood at $1,039 million and total debt at $8,206 million as of September 27, 2026.
Nine-month operating cash flow was $1,877 million, up from $1,343 million, while dividends paid totaled $1,199 million. The company declared a quarterly dividend of $0.21 per share, and the 2026 Restructuring Initiative is expected to cost about $250 million in fiscal 2026, with targeted annualized gross savings of about $200 million.
02—Key points
Key Highlights
- Q3 2026 Net sales of $3,886 million, up 3.2% year over year; Organic sales up 2.9% (volume 1.6%, value realization 1.3%)
- Q3 2026 Net income of $430 million ($0.22 diluted EPS) versus $398 million ($0.21) in Q3 2025; Gross profit margin expanded 40 basis points to 59.5%
- Pending Transaction with Kimberly-Clark: holders receive 0.14625 K-C shares plus $3.50 cash per share; Kenvue holders expected to own ~46% of the combined company
- K-C exchange offers for up to $7.0 billion of Kenvue Senior Notes launched September 28, 2026; supplemental indenture dated October 9, 2026 removes substantially all restrictive covenants upon settlement
- Nine-month operating cash flow of $1,877 million, up from $1,343 million; cash and equivalents of $1,039 million and total debt of $8,206 million at September 27, 2026
- 2026 Restructuring Initiative approved February 17, 2026, with expected FY2026 pre-tax charges of about $250 million and annualized gross savings of about $200 million
- Quarterly dividend of $0.21 per share declared September 10, 2026; $1,199 million of dividends paid in the nine months
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2026, Kenvue kept $0.11.
- Revenue$3.89B100.0%
- Cost of revenue−$1.57B40.5%
- Gross profit$2.31B59.5%
- Operating costs−$1.61B41.4%
- Operating income$706.0M18.2%
- Interest, other & tax−$276.0M7.1%
- Net income$430.0M11.1%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2026filed October 30, 2026Financial Statements
Q3 FY2026 against Q3 FY2025
| Line item | Q3 FY2026Q3 FY2025 | Change |
|---|---|---|
| Revenue | $3.89B$3.76B | +3.2% |
| Cost of Revenue | $1.57B$1.54B | +2.2% |
| Gross Profit | $2.31B$2.23B | +4.0% |
| R&D Expenses | $96.00M$94.00M | +2.1% |
| SG&A Expenses | $1.57B$1.51B | +3.8% |
| Operating Income | $706.00M$629.00M | +12.2% |
| Interest Expense | $104.00M$107.00M | −2.8% |
| Net Income | $430.00M$398.00M | +8.0% |
| EPS (Basic) | $0.22$0.21 | +4.8% |
| EPS (Diluted) | $0.22$0.21 | +4.8% |
| Shares Outstanding (Basic) | 1.92B1.92B | +0.2% |
| Shares Outstanding (Diluted) | 1.93B1.92B | +0.2% |
05—Questions
Frequently Asked Questions
What is the status of the Kimberly-Clark transaction?
Kenvue shareholders approved the Merger Agreement on January 29, 2026, and the HSR waiting period expired on February 4, 2026. Completion remains subject to the satisfaction or waiver of other customary closing conditions. Kenvue is also divesting its feminine care business in certain countries, including an agreement with Essity for Brazil, as part of obtaining regulatory approvals.
How did revenue and profitability trend in the quarter?
Net sales rose 3.2% to $3,886 million, with Organic sales up 2.9%. Operating income increased 12.2% to $706 million, helped by lower restructuring expenses ($33 million versus $84 million), while Pending Transaction and other related costs of $28 million were recorded in segment reconciliation. Net income rose to $430 million from $398 million, though the effective tax rate increased to 29.4% from 24.3%.
What segment performance did Kenvue report?
For the quarter, Self Care net sales rose 5.9% to $1,656 million with segment adjusted operating income of $537 million. Skin Health and Beauty net sales were essentially flat at $1,039 million, with segment adjusted operating income up 8.8% to $149 million. Essential Health net sales rose 2.5% to $1,191 million, with segment adjusted operating income of $315 million.
What is the company's liquidity and debt position?
Cash and cash equivalents were $1,039 million and total debt was $8,206 million as of September 27, 2026. The company had a $4.0 billion revolving credit facility, with no amounts outstanding, and a $4.0 billion commercial paper program with $1,118 million outstanding. The 5.35% Senior Notes due 2026 ($750 million) were redeemed in February 2026.
What legal matters are disclosed?
The filing describes acetaminophen-related lawsuits, including a July 2026 Second Circuit decision that vacated the District Court's judgment and remanded for further proceedings. It also describes talc-related claims involving Johnson's Baby Powder in the UK, Australia, and Scotland, and phenylephrine and benzoyl peroxide class actions. The company accrued amounts for certain litigation matters but stated that the ultimate outcome is not expected to have a material adverse effect on its financial position. J&J retains talc liabilities for U.S. and Canadian exposures under the Separation Agreement.
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