The company, which owns household brands like Febreze, Charmin and Tide, also raised its forecast for organic sales growth for fiscal 2023 to 6%, up from its prior range of 4% to 5%.
Shares of P&G rose 2% in premarket trading.
Here’s what the company reported for the quarter ended March 31 compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
- Earnings per share: $1.37 vs. $1.32 expected
- Revenue: $20.07 billion vs. $19.32 billion expected
P&G reported fiscal third-quarter net income of $3.4 billion, or $1.37 per share, up from $3.36 billion, or $1.33 per share, a year earlier.
Net sales rose 4% to $20.07 billion. Organic sales, which strip out the effects of foreign currency, acquisitions and divestitures, increased 7% in the quarter.
But the company’s volume, which excludes price and currency changes, fell 3% as consumers opted for cheaper alternatives. Across its portfolio, P&G’s prices were up 10% year over year.
This marks the fourth consecutive quarter of shrinking volume for the consumer giant.
CFO Andre Schulten said on a press call that volume improved sequentially from the company’s fiscal second quarter. He added that quarterly volume fell just 2% from last year when excluding P&G’s business in Russia, where it scaled back operations and advertising since the Kremlin started the war in Ukraine last year.
All of P&G’s divisions reported declining volume for the quarter, except for its health and beauty units, which both saw volume increase just 1%.
However, volume actually increased in the U.S., the company’s biggest market, according to Schulten. He pointed to another bright spot in China, P&G’s second-largest market, which is finally recovering from Covid lockdowns and seeing improvements in consumer confidence.
P&G once again raised prices in the U.S. and Europe during the fiscal third quarter, Schulten said.
P&G’s fabric and home care segment, which includes brands like Tide, Swiffer and Mr. Clean, saw its volume fall 5% in the steepest drop among the company’s business units. P&G said volume declines came primarily in Europe.
The baby, feminine and family care segment reported a 4% volume decline. The division, which includes Pampers, Bounty and Charmin, also saw volume fall in Europe. The company said demand for its diapers was lower there.
P&G’s grooming business, which includes Gillette and Venus razors, reported a 1% drop in volume. The unit has typically lagged the rest of P&G’s portfolio, but performed relatively better this quarter. However, lower demand for its appliances caused the unit’s volume decline.