Consumer Goods Earnings

Falling volumes remain the trend in consumer goods land, with several big players reaffirming that trend during their earnings release. 📉

Procter & Gamble’s fiscal 2024 outlook fell short of Wall Street expectations, with overall volume falling for the fifth consecutive quarter. Executives believe volumes will begin to increase in 2024 and expect to rise prices by only 1% to 1.5%.

Colgate-Palmolive beat revenue and earnings expectations, raising its full-year outlook. The company said an 11% price increase helped offset a 1.5% decline in volume. Gross margins also increased as supply chains improved and costs fell marginally.

Mondelez International experienced 17% organic net revenue growth during the quarter, as strong demand for its snacks offset its high cost of goods. Executives say pricing drove organic net revenue growth, as its volume/mix was flat during the second quarter. Looking ahead, they raised organic net revenue and adjusted EPS growth outlook to 12%+. But it shows that even with solid demand, volumes can’t seem to grow in the current environment.

Overall, these companies continue to face several headwinds. They’ve got inflation-strapped consumers trading down to private-label brands to save on necessities. Additionally, with supply chains stabilizing, their pricing power in the market is also dwindling. Plus, commodity price volatility could push costs if they begin to rally through the back half of the year. ⚠️

Executives are preparing for volatile results over the next year. They remain cautiously optimistic about the economy and overall consumer health. We’ll have to see if they’re right as their stocks continue to consolidate near all-time highs. 🤷

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