Kimberly-Clark Q4 Earnings Top Estimates, Organic Sales Up 2.1%

Kimberly-Clark Corporation KMB posted fourth-quarter 2025 results, wherein the bottom line improved year over year and beat the Zacks Consensus Estimate. The top line declined year over year and missed the consensus mark.Kimberly-Clark accelerated its largest transformation in 2025, delivering strong results through innovation, brand-building, disciplined cost management and share-led volume growth. The planned acquisition of Kenvue represents a key next step in the company’s transformation, strengthening momentum, expanding higher-growth personal care categories and creating long-term value for shareholders while improving care for consumers globally.Taking a Closer Look at KMB’s Q4 ResultsThe adjusted earnings were $1.86 per share, which beat the Zacks Consensus Estimate of $1.39. However, the bottom line increased 24% year over year, driven by growth in adjusted operating profit, reduced diluted shares outstanding and elevated income from equity companies.Kimberly-Clark Corporation Price, Consensus and EPS Surprise Kimberly-Clark Corporation price-consensus-eps-surprise-chart | Kimberly-Clark Corporation QuoteKimberly-Clark’s sales were $4,080 million, marking a 0.6% decline from $4,104 million in the prior-year quarter. The figure missed the Zacks Consensus Estimate of $4,120 million. The decrease reflected a 2.5% headwind, primarily from the exit of the company’s U.S. private-label diaper business, which more than offset organic sales growth of 2.1%. Organic growth was driven by 3% volume-and-mix expansion, partially offset by 1.1% in price investments aimed at enhancing value propositions.The adjusted gross margin reached 37%, flat year over year, as strong productivity savings and volume growth were offset by unfavorable pricing net of cost inflation, reflecting planned investments to enhance price-value tiers across the portfolio.Adjusted operating profit increased 13.1% to $629 million, driven by strong productivity savings and reduced marketing, research and general expenses.KMB Provides Q4 Insights by SegmentThe segments exclude the International Family Care and Professional ("IFP") business, which is reported as discontinued operations.North America (“NA”) segment’s net sales reached $2,641 million, down 3% year over year, reflecting the 3.7% impact from the exit of the company’s private-label diaper business, partially offset by organic sales growth of 0.8%. Organic growth was supported by broad-based volume gains of 2.5%, which were partially offset by declines in price and mix.NA’s operating profit rose 5.5% to $580 million, supported by productivity gains and lower marketing, research and general expenses despite a 290-basis-point divestiture-related headwind.The International Personal Care (“IPC”) segment’s net sales were $1,439 million, up 4.2%, with organic sales growth of 4.5%. Organic growth was supported by strong volume-led gains of 3.3%, reflecting improved consumer value propositions across the portfolio, and a favorable portfolio mix of 2.4%, partially offset by price investments of 1.2%.IPC’s operating profit increased 20.6% to $199 million, driven by volume and mix-led gains, strong productivity savings and reduced marketing, research and general expenses, partially offset by pricing investments resulting in unfavorable pricing net of cost inflation.Kimberly-Clark’s Financial Health SnapshotThe company ended the quarter with cash and cash equivalents of $688 million, long-term debt of $6,474 million and total stockholders’ equity of $1,630 million.For the 12 months ended Dec. 31, cash provided by operations was $2,777 million. Management incurred capital spending of $1,138 million in the same time frame. The company returned $1.8 billion to its shareholders via dividends and share buybacks.What to Expect From KMB in 2026In line with the long-term growth strategy, Kimberly-Clark expects 2026 organic sales growth to outpace the weighted-average growth of the markets and categories, which are currently expanding at roughly 2%.For 2026, the company’s net sales are expected to reflect a negative impact of approximately 50 bps from the exit of its private label diaper business in the United States with no meaningful impact from currency translation. Adjusted operating profit is predicted to grow at a mid-to-high single-digit rate on a constant-currency basis compared with the prior year. Adjusted earnings per share from continuing operations are projected to grow at a double-digit rate on a constant-currency basis, driven by an approximately 30% increase in income from equity companies versus 2025, flat net interest expense, an adjusted effective tax rate of approximately 23%, and average shares outstanding essentially unchanged from 2025.The metric is expected to be flat on a constant-currency basis, indicating a reduction in income from discontinued operations in line with the anticipated mid-2026 close of the IFP transaction, with proceeds expected to be held, in part, to fund the Kenvue acquisition.This Zacks Rank #4 (Sell) company has lost 16.1% in the past three months compared with the industry’s 0.7% decline.Image Source: Zacks Investment ResearchStocks to ConsiderUnited Natural Foods, Inc. 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(MAMA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks