The Procter & Gamble Company (PG) Q2 2025 earnings summary

Executive summary

• Organic sales grew 3% in Q2 FY25, driven by volume and mix, with pricing neutral and 9 of 10 product categories posting growth.

• Net sales for the quarter were $21.9B, up 2% year-over-year; net earnings attributable to P&G rose 34% to $4.6B, and diluted EPS increased 34% to $1.88, reflecting a prior-year Gillette impairment.

• Core EPS was $1.88, up 2% year-over-year; currency-neutral core EPS increased 3%.

• Global value share was flat, with 28 of the top 50 category/country combinations holding or growing share.

• Over $4.9B was returned to shareholders via dividends and share repurchases in the quarter.

Financial highlights

• Gross margin for the quarter was 52.4%, down 30 bps year-over-year; core gross margin also down 30 bps.

• Core operating margin was 26.2%, down 80 bps; reported operating margin increased 550 bps due to prior-year impairment.

• Adjusted free cash flow productivity was 84% for the quarter.

• Net earnings attributable to P&G were $4.63B, up 34% year-over-year.

• SG&A expense increased 4% for the quarter, with SG&A as a percentage of net sales at 26.2%.

Outlook and guidance

• FY2025 organic sales growth guidance is 3–5%; all-in sales growth expected at 2–4%.

• Core EPS growth forecast for FY2025 is 5–7% over $6.59 in FY2024, equating to $6.91–$7.05 per share; all-in EPS growth projected at 10–12%.

• Commodity and FX headwinds expected to impact EPS by $0.20/share; additional $0.10–$0.12 headwind from prior-year divestiture and tax benefits.

• Plans to pay ~$10B in dividends and repurchase $6–$7B in shares in FY2025.

• Guidance excludes potential headwinds from market deceleration, currency weakness, commodity cost increases, supply chain disruptions, and geopolitical volatility.