Please note also that our earnings release and prepared remarks are available on our website at thecloroxcompany.com. During this call, we may make forward-looking statements, including about our fiscal year 2027 outlook. Maybe just, a lot of moving pieces here, but you noted weaker category growth. Can you maybe just unpack what's embedded from a category standpoint relative to market share in the flat to up slightly organic sales outlook?
What we referenced as weaker category growth is very consistent with actually what we saw in fiscal year 2026. I would say very much in line with the category growth that we saw in 2026. We expect to continue to make progress throughout the course of the fiscal year on market share, and that gets us to the combination of what we expect from an organic growth perspective. We saw our home care business continue to deliver share growth for eight consecutive quarters of share growth in home care.
We continue to see strong share growth in our pro and international businesses. Our outlook assumes an average for Brent crude oil at about $90 per barrel. Can you comment on how things have been performing as an organic basis if you were to compare like for like? Of course, I'll note it's early, we continue to feel great about the synergies, about the opportunities to enhance growth.
| Metric | Period | Current guidance |
|---|---|---|
| Organic sales growth | FY2027 | Flat to up slightly (assumes muted category growth similar to FY2026) |
| Gross margin | FY2027 | ~42% (recovery weighted to the back half as inflation is front-loaded) |
| Total supply-chain inflation | FY2027 | >$200 million (Brent ~$90/bbl; commodities plus freight/logistics) |
| Interest expense | FY2027 | ~$210 million (GOJO-related debt) |
| Advertising and sales promotion | FY2027 | ~10% of sales including GOJO (over 11% ex-GOJO) |
| Free cash flow | FY2027 | In line with the 11%-13% target |
| GOJO growth contribution | FY2027+ | Accretive to adjusted EPS; mid-single-digit growth building to mid-to-high single digits as revenue synergies ramp |
| Metric | YoY | Note |
|---|---|---|
| Net sales | -2% to $1.95B (organic -13%) | GOJO added ~10 points; organic decline primarily from lapping prior-year ERP-transition shipments. |
| Earnings from operations | $258M (13.2% margin) | Lower gross profit ($804M, margin 41.3%, down 520 bps) partly offset by roughly flat S&A; advertising rose to $216M. |
| GAAP diluted EPS | $1.34 (-50%) | Lower net sales and gross margin plus the GOJO inventory step-up; net earnings attributable to Clorox of $163 million. |
| Adjusted EPS | $1.66 (-42%) | Lower net sales and gross margin; the ERP shipment comparison was about a 90-cent headwind. |
| Gross margin | 41.3% (-520 bps) | Lower volume, the GOJO acquisition inventory step-up (~150 bps), and ERP-shipment lapping. |
| Consumption / market share (FY2026 trend) | Consumption ~flat exiting Q4; share -0.1 pt aggregate | Sequential improvement each quarter, strongest June exit rate, with turnarounds in Glad and Hidden Valley and continued Home Care/pro/international share gains. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| GOJO / Purell integration | Recently closed (April 2026) | Integration on plan (some ahead), performing above targets and accretive in Q4; a B2B business with a different P&L (about half a point of gross-margin dilution, higher SG&A, lower advertising) expected to grow mid-single-digits, rising to mid-to-high as revenue synergies appear as early as FY2027. | — |
| Value superiority model | Five-lever framework | Amid heightened value-seeking (most acute among low-income consumers), Clorox is investing across product, package, proposition, place, and price by business and retailer, including targeted pricing (a regular Glad increase) and product/packaging upgrades. | — |
| Category and share recovery | Post-cyber operational focus | Home Care fully recovered with eight straight quarters of share growth; Glad trash and Hidden Valley turned around; litter (Fresh Step) remains an early-innings turnaround with back-half FY2027 innovation to come. | — |
| ERP and productivity | Implementation in progress | Implementation complete; now in stabilization, with supply-chain planning, order-to-cash, and back-office automation plus global business services savings expected late FY2026 into FY2027; total productivity is expected to exceed inflation in SG&A next year. | — |
| Inflation and pricing | Post-2022/23 cycle | >$200 million of FY2027 inflation, front-half weighted; management sees no structural loss of pricing power, taking targeted/strategic pricing (regular increases where warranted, e.g., resin-exposed Glad) alongside revenue growth management and cost savings. | — |
| CEO transition | — | CEO Linda Rendle (now cancer-free) intends to step down for health reasons; an external search firm is engaged and the process is on the board's timeline, with the company focused on executing the FY2027 plan to set up the next leader. | — |
| Retailer relationships and e-commerce | Post-cyber distribution recovery | Distribution is now above post-cyber levels with share-of-distribution gains; Clorox is deepening e-commerce sophistication with large retailers and positioning for future 'agentified' commerce as a category advisor. | — |