THE WHAT? Kenvue reported fourth quarter 2025 sales and earnings growth, while full-year results reflected declines in net and organic sales, as the company progresses toward its proposed acquisition by Kimberly-Clark.

THE DETAILS In Q4 2025, net sales rose 3.2%, driven by 1.2% organic sales growth and a 2.1% foreign exchange benefit. Diluted EPS increased to US$0.17 (vs US$0.15), while adjusted diluted EPS rose to US$0.27 (vs US$0.26). Gross margin remained flat at 56.5%, with adjusted gross margin edging up to 58.8%. Adjusted operating margin improved to 19.9% from 19.2%. Segment-wise, Essential Health led growth (+6.1%), followed by Skin Health and Beauty (+2.9%) and Self Care (+1.5%).

For the full year, net sales declined 2.1%, with organic sales down 2.2% due to lower volumes and subdued seasonal demand, particularly in Self Care. Diluted EPS rose to US$0.76 (vs US$0.54), while adjusted EPS declined to US$1.08 (vs US$1.14). Operating cash flow improved to US$2.2 billion, with free cash flow reaching US$1.7 billion. Total debt stood at US$8.5 billion at year-end. The company did not issue forward guidance due to its pending transaction with Kimberly-Clark, which is expected to close in H2 2026, subject to regulatory approvals.

THE WHY? The results reflect improving quarterly execution and margin discipline amid macro headwinds and inventory reductions, while the pending Kimberly-Clark acquisition positions Kenvue for its next phase of strategic value creation.

Source: Kenvue

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