Filippo Falorni • Citigroup

Answer

CFO Amit Banati explained that the full-year guidance for a low-single-digit decline does not assume a significant improvement in H2. However, factors like a stronger innovation pipeline and easier Q4 comps could push results to the high end of the range. He noted the guidance assumes continued soft category growth. Margin pressure stems from strategic price investments, fixed cost deleverage, and inflation.

Ask Fintool Equity Research AI

Answer

CFO Amit Banati clarified that the full-year guidance for a low-single-digit decline does not assume an improvement from the first half's performance. He noted that stronger innovation and lapping easier Q4 comps could push results to the higher end of the range. The guidance incorporates observed category softening and cautious consumer sentiment. The margin outlook reflects strategic price investments, fixed cost deleverage, and inflation.

Ask Fintool Equity Research AI

Answer

CEO Thibaut Mongon explained that in the U.S., distributors replenished inventory more than expected, ending the season at an appropriate level. CFO Paul Ruh detailed that the $150M tariff impact is primarily from China, which accounts for about two-thirds of the impact despite being only 10% of trade spend. He noted Kenvue is assessing the potential impact of pharma tariffs but is not ready to provide a number.

Ask Fintool Equity Research AI

Answer

CEO Thibaut Mongon expressed confidence in the 2-4% guidance, noting the 2024 run rate was closer to 2.5% excluding pediatric pain. He stated Kenvue does not expect a Q1 inventory restock for pediatric products in the U.S. or China. CFO Paul Ruh quantified the combined Q1 headwind from destocking and strategic trade investments at 3-4 points, leading to an expected low single-digit decline in organic sales for the quarter, which he emphasized masks the underlying health of the business.

Ask Fintool Equity Research AI

Answer

Executive Thibaut Mongon reported that U.S. inventory levels are low and he does not expect further destocking. Globally, he sees cautious ordering in self-care categories due to low illness incidence. Regarding the drug channel, he acknowledged that while future store closures may have a short-term impact, he expects demand to normalize over time as consumers seek out their needed brands in other locations.

Ask Fintool Equity Research AI

Answer

CEO John Fieldly attributed the brand's acceleration to strategic shifts in promotions, a new 'Live Fit Go' marketing campaign, and successful innovation in the Fizz-Free line. He confirmed the first Celsius LTO is scheduled for the fall/winter season, leveraging learnings from the Alani integration, but did not disclose specific product details.

Ask Fintool Equity Research AI

Answer

CEO Gavin Hattersley highlighted positive on-premise trends for Blue Moon, Peroni, and Coors Banquet but did not comment on specific July performance. CFO Tracey Joubert explained that margin pressure stems from volume deleverage due to the exit of contract brewing, higher COGS associated with premiumization, and the Midwest premium, which are collectively offsetting productivity and cost savings.

Ask Fintool Equity Research AI

Answer

CEO Gavin Hattersley reiterated that the company's guidance assumes the industry will perform better than the approximate 5% decline seen in Q1 but did not provide a specific forecast. CFO Tracey Joubert addressed tariffs, stating the direct impact is not expected to be material as most brands are produced domestically. She noted that while imports like Fever-Tree can be onshored and Peroni is now largely U.S.-produced, the main indirect risk is the Midwest aluminum premium, which is difficult to hedge.

Ask Fintool Equity Research AI

Answer

CEO Gavin Hattersley addressed the tariff concern by stating that nearly all aluminum for the U.S. market is sourced domestically. CFO Tracey Joubert added that while the company does not provide specific gross margin guidance, they anticipate underlying pretax margin expansion driven by positive net pricing, favorable mix from premiumization and reduced contract brewing, and moderating input cost inflation.

Ask Fintool Equity Research AI

Answer

CEO Gavin Hattersley confirmed a positive outcome, stating that the company successfully retained the significant shelf space gained during the unprecedented resets of last fall and spring, and even managed to gain a little more. He expects future resets to revert to smaller, more typical adjustments.

Ask Fintool Equity Research AI

Answer

CFO Lee McChesney stated that broader inflation remains slightly elevated. Regarding tariffs, after managing the China impact, the primary exposures are now Korea, Thailand, Vietnam, and Europe. President and CEO Rick Dierker emphasized the dynamic nature of the situation, noting the projected 12-month tariff impact had recently decreased from $60 million to $50 million overnight due to policy changes, underscoring the company's need for agility.

Ask Fintool Equity Research AI

Answer

CEO Matthew Farrell stated that innovation is contributing approximately 2% in incremental net sales for 2024, which he described as a fantastic result, and noted the innovation pipeline is strong for the next few years. Regarding China, he explained that the company has taken steps to mitigate potential tariff impacts by reclassifying import codes and moving some production out of China, which is most relevant for the WATERPIK business.

Ask Fintool Equity Research AI

Answer

Richard Dierker (CFO and Head of Business Operations) stated that while inflation on items like pulp and HDPE is slightly higher, it's offset by better productivity. He confirmed the second-half outlook includes 'dry powder' for potential trade, couponing, and promotional spending to support new products, but it is not certain to be deployed.

Ask Fintool Equity Research AI

Answer

CEO Chris Peterson stated that retail inventories are in reasonably good shape, with only a minor Q2 impact from retailers pausing direct import business due to tariffs. On pricing, he described the current environment as 'fuzzy' due to tariff noise but noted that competitors are also raising prices, albeit on different timelines. He expects clarity in the next 3-6 months and highlighted Newell's value advantage in categories where its domestic manufacturing base is not subject to tariffs.

Ask Fintool Equity Research AI

Answer

CFO Mark Erceg stated that for the full year, the company expects pricing, net of elasticity, to contribute 1 to 2 percentage points to core sales growth. CEO Christopher Peterson confirmed that Newell, along with the broader industry, is actively lobbying for a tariff exemption on baby gear, similar to what was granted by the previous administration, but noted the outcome remains uncertain.

Ask Fintool Equity Research AI

Answer

CEO Christopher Peterson highlighted the FUEL productivity program, which is delivering over 6% COGS savings this year and has a strong pipeline for next year, as the biggest driver. CFO Mark Erceg added other significant opportunities, including improved innovation economics, automation, attractive marginal economics from volume growth, and a new trade fund management system launching in January.

Ask Fintool Equity Research AI

Answer

CFO Stanley Sutula confirmed the full-year guidance for a roughly flat gross margin, explaining that lower tariff impacts are being offset by higher raw material costs—primarily palm, vegetable oils, and tallow—and lower organic sales. Chairman, CEO & President Noel Wallace highlighted that the 'Funding the Growth' productivity initiatives were strong in the quarter and are being accelerated.

Ask Fintool Equity Research AI

Answer

Noel Wallace, Chairman, President and CEO, stated that Q1 pricing was largely as expected and improved sequentially on a two-year stack basis. He mentioned pricing actions in Latin America for Q2-Q4 and encouraging pricing in Europe driven by premium innovation. Regarding tariffs, he explained that while some pricing will be necessary, the primary response will be creating value through innovation, alongside other levers like revenue growth management (RGM).

Ask Fintool Equity Research AI

Answer

CEO Noel Wallace outlined the capital allocation priorities as: first, investing back into the business for growth and efficiency; and second, returning cash to shareholders through dividends and buybacks. CFO Stan Sutula reinforced this, noting that record operating cash flow enables this strategy. He highlighted that net share buybacks were $1.1 billion in the year and that any M&A must be strategically aligned to drive long-term value.

Ask Fintool Equity Research AI

Answer

Noel Wallace, Chairman, President and CEO, stated that the company will continue its strategy of investing in long-term capabilities, funded by gross margin flexibility. He highlighted a focus on accelerating H2 and H3 innovation, maintaining high advertising levels to improve brand health and drive share growth, and using analytics to find household penetration opportunities.

Ask Fintool Equity Research AI

Answer

CFO Luc Bellet stated the guidance assumes U.S. categories will grow 0-1%, stabilizing but not yet normalizing. CEO Linda Rendle described the promotional environment as largely rational, except for heightened activity in trash and cat litter, which is expected to persist. Bellet quantified the expected tariff headwind at approximately $40 million, which the company plans to offset through various mitigating actions, including targeted pricing.

Ask Fintool Equity Research AI

Answer

CEO Linda Rendle acknowledged the 3-5% target is predicated on healthier category growth of 2-2.5%, which is not currently visible, and stated near-term growth will be suppressed. CFO Luc Bellet addressed tariffs, estimating a $100 million impact on a 12-month run-rate basis, with $10-$20 million expected in Q4. He outlined mitigation plans including sourcing changes, supply chain adjustments, and targeted, modest strategic pricing.

Ask Fintool Equity Research AI

Answer

CFO Kevin Jacobsen clarified that the Kingsford shipment contributed less than one point to the Q2 beat, with stronger base business performance being the primary driver. CEO Linda Rendle noted that while Litter promotions were in line with expectations, Glad saw more competitive activity than anticipated, which the company has addressed and factored into its outlook.

Ask Fintool Equity Research AI

Answer

CEO Linda Rendle reported strong progress in the Glad business, which has returned to share growth. For Litter, she noted progress in restoring subscriptions and regaining the #1 share position at a key retailer but acknowledged a full recovery will take longer. CFO Kevin Jacobsen projected the back-half gross margin to be around 44% to 44.5%, consistent with the full-year target, following an expected dip in Q2 due to volume deleveraging.

Ask Fintool Equity Research AI

Answer

CFO Andre Schulten identified three drivers for destocking: the ongoing channel shift to more inventory-efficient retailers like online and club, retailers managing cash flow amid tariff impacts, and a reaction to slowing consumption. He noted that P&G's guidance assumes inventory levels will remain stable, not rebound.

Ask Fintool Equity Research AI

Answer

Executive Andre Schulten reported no data suggesting a negative impact from nationalistic sentiment, as many P&G brands are perceived as local. He highlighted encouraging progress in China, with SK-II growing 11% and Olay returning to growth. He also noted that excluding the impact of a new law in France, Europe's focus markets would have grown 5%, indicating underlying strength.

Ask Fintool Equity Research AI

Answer

Andre Schulten, an executive, noted that Enterprise Markets grew 3% on a tough 17% comparison. He described Mexico as currently more difficult but expects acceleration in Latin America in the second half. Europe Enterprise Markets remain strong with significant volume share gains. He stated that the Middle East will likely remain a more difficult environment through the second half, with stabilization being the key driver.

Ask Fintool Equity Research AI

Answer

Executive Andre Schulten stated that predicting China's recovery pace is difficult, which is why the guidance is a range, but noted that sequential improvement is expected from the math of annualization. Regarding quarterly progression, he declined to give a specific forecast but acknowledged a logical expectation for some improvement into Q2, while reiterating that major headwinds persist through the first half.

Ask Fintool Equity Research AI

Answer

Founder & Chairman C. James Koch acknowledged the industry-wide slowdown, attributing it to poor weather and pressure on Hispanic consumers, but noted Boston Beer is gaining share. He explained that the consumer swap from Twisted Tea to the more premium Sun Cruiser is margin accretive and that the interaction is limited. President & CEO Michael Spillane added that Twisted Tea Light and Extreme are performing well and the brand is regaining shelf space.

Ask Fintool Equity Research AI

Answer

CEO Michael Spillane stated that the company does not break out shipment volumes by product but confirmed Sun Cruiser is meeting expectations and is margin accretive. For Twisted Tea, he attributed the Q1 slowdown to a challenging macro environment and increased competition, expressing confidence that regaining shelf space, heavy advertising investment, and innovation in high-ABV and light versions would drive future single-digit growth.

Ask Fintool Equity Research AI

Answer

CEO Michael Spillane confirmed that the planned tripling of Sun Cruiser's distribution is incremental. CFO Diego Reynoso clarified that potential aluminum tariffs are not built into guidance as they are unknown, but noted the company's overall exposure is less significant than competitors due to its U.S. manufacturing footprint. He also specified a recent contract renegotiation was with a co-packer, not a materials supplier.

Ask Fintool Equity Research AI

Answer

Founder and Chairman C. Koch acknowledged several small, cumulative structural headwinds like cannabis and health concerns. However, he noted that beer pricing is now below inflation and sees a significant opportunity for the beer industry to gain share of alcohol from wine and spirits via the growing 'fourth category,' while also pointing to a recent upswing in industry volumes.

Ask Fintool Equity Research AI

Answer

CEO Tim Cofer identified protein as a 'white space' that KDP is evaluating through its 'buy, build, or partner' framework, though he had nothing to announce. He described the Dyla acquisition as an opportunistic tuck-in to enter the attractive powdered drink mix category. He noted Dyla's strong growth and functional product mix provide capabilities to extend other KDP brands into the space.

Ask Fintool Equity Research AI

Answer

Chief Financial Officer Sudhanshu Priyadarshi indicated that the U.S. Coffee segment's sales and operating income will likely remain under pressure for 2025. This is due to the slower-than-expected timing of industry pricing in Q1 and the incremental impact of tariffs on both green coffee and brewers. He noted that KDP has already announced a price increase on brewers to help manage profit dollars, but the segment's performance is expected to be subdued for the year, while the overall enterprise guidance remains intact.

Ask Fintool Equity Research AI

Answer

Chief Financial Officer Sudhanshu Priyadarshi clarified that the 2025 outlook implies modest operating margin expansion, not necessarily gross margin expansion. This will be driven by volume leverage, pricing, strong productivity savings at the high end of the 3-4% range, and overhead discipline. He noted that while hedging and long-term contracts for commodities like aluminum can delay inflation, they do not permanently offset it, and these factors are built into the company's forecast.

Ask Fintool Equity Research AI

Answer

Chairman and CEO James Quincey noted that the U.S. business improved sequentially in Q2 amid a resilient consumer environment. He stated that the issues with Hispanic consumers from Q1 were 'largely resolved' by June, with brand metrics recovering. He added that the away-from-home channel reflects the broader economy, with the company successfully winning new accounts like Costco and Carnival.

Ask Fintool Equity Research AI

Answer

Chairman and CEO James Quincey stated that while they monitor sentiment, they respond to consumer behavior, with the main issues currently concentrated in the U.S. and Mexico. Regarding trade, he described the potential impact as 'manageable' due to the company's local franchise structure, noting that exposure to tariffs on inputs is relatively small and already factored into current pricing plans.

Ask Fintool Equity Research AI

Answer

CEO James Quincey emphasized that the business is predominantly local, mitigating broad tariff impacts. He explained the company uses hedging programs, adjusts sourcing, and implements productivity measures to manage commodity variations. CFO John Murphy added that supply chain continuity remains a key priority and an advantage, with the cross-enterprise procurement team actively managing the network to ensure consistent supply.

Ask Fintool Equity Research AI

Answer

President and CFO John Murphy stated the company is on track for its highest gross margin since pre-COVID and expects underlying expansion to continue. For 2025, he anticipates a more normalized pricing environment and plans to use RGM, cost efficiencies, promotional optimization, and supplier management to offset FX headwinds and agricultural commodity inflation.

Ask Fintool Equity Research AI

Answer

Chairman and CEO Ramon Laguarta described the away-from-home channel as a significant and margin-accretive growth opportunity for both food and beverages, noting it is a larger part of the beverage business. He confirmed it is a key focus area for increased resources and innovation beyond just expanding physical product availability.

Ask Fintool Equity Research AI

Answer

Chairman and CEO Ramon Laguarta affirmed that the international business remains the company's largest growth engine and is expected to continue its mid-single-digit growth trend. He noted positive signs in Europe, India, and Brazil, while acknowledging some consumer slowdown in China and Mexico. He confirmed the international segment will continue to be a key contributor to overall growth.

Ask Fintool Equity Research AI

Answer

CFO Jamie Caulfield described the guidance as prudent given global uncertainty. He confirmed that the international business is expected to remain resilient and be a major contributor to 2025 results. He stated the gradual acceleration in North America throughout the year will be driven by the previously mentioned initiatives: innovation, expansion into new spaces, and a greater focus on the away-from-home channel.

Ask Fintool Equity Research AI

Answer

Chairman and CEO Ramon Laguarta identified areas of deceleration in China, Mexico, and parts of Western Europe, while noting the Middle East is impacted by geopolitical issues. He contrasted this with pockets of strength in Southeast Asia, India, and Brazil. He also confirmed that, globally, the beverage business is currently growing slightly faster than the food business.

Ask Fintool Equity Research AI

Answer

President & CEO Bill Newlands acknowledged an expected increase in market promotions during times of economic concern, citing Constellation's own price adjustment on its 'Oral' brand to compete with high-end light beers. He maintained that the company's strong brands and consumer loyalty are its ultimate competitive advantages.

Ask Fintool Equity Research AI

Answer

CEO Bill Newlands acknowledged an increase in promotional activity across the market, which is expected in times of economic concern. He cited Constellation's own adjustment of its Oral pricing to compete in the high-end light segment, but stressed that strong brand loyalty is the ultimate driver of success.

Ask Fintool Equity Research AI

Answer

CFO Garth Hankinson reiterated that the 39-40% operating margin target is achievable through a combination of positive factors. These include incremental volume growth, pricing in the 1-2% range, cost-saving initiatives that mitigate inflation, and disciplined management of depreciation expense from the company's modular capacity expansion strategy.

Ask Fintool Equity Research AI

Answer

CFO Garth Hankinson reaffirmed that the company views a 39% to 40% operating margin as the appropriate long-term range for the beer business. He detailed that in any given year, tailwinds from volume, cost savings, and pricing are balanced against headwinds from inflation, depreciation from new capacity, and fixed cost absorption, causing results to fluctuate within that range.

Ask Fintool Equity Research AI

Answer

CFO Garth Hankinson stated that the company has already hit its $300 million cost savings target, which has benefited margins. For the second half, he noted that margins will be impacted by lower fixed cost absorption due to typical volume seasonality (45% of volume in H2) and higher marketing spend as a percentage of net sales, particularly in Q3. This will lead to sequentially lower margins in the second half despite the ongoing benefit from cost savings.

Ask Fintool Equity Research AI

Answer

Executive Hilton Schlosberg confirmed the company uses a laddered hedging approach for aluminum but noted that hedging the Midwest premium is difficult and expensive. He stated that due to rising costs like the Midwest premium, he does not expect the second quarter's gross margin to be as high as the first quarter's, though he did not provide specific guidance.

Ask Fintool Equity Research AI

Answer

Executive Hilton Schlosberg acknowledged potential pressure on Hispanic consumer spending and attributed weak January sales to an 'aberration' caused by severe weather. He also highlighted the reporting lag between company sales to distributors and Nielsen's retail data. Rodney Sacks added that recent weekly data shows Monster's growth recovering, suggesting the January impact was temporary.

Ask Fintool Equity Research AI

Answer

Rodney Sacks, Chairman and Co-CEO, noted that while innovation is a driver, the latest product only reached shelves late in October, suggesting its impact on recent trends was minimal. He believes the improvement is broader across multiple SKUs. Hilton Schlosberg, Vice Chairman and Co-CEO, added that improving macroeconomic conditions and increased foot traffic in convenience stores are also significant positive factors.

Ask Fintool Equity Research AI

Answer

CEO Sue Nabi affirmed the sustainability of mid-single-digit growth, particularly in the U.S., driven by new users like Gen Z and male consumers. She stated that European growth will likely be driven by mix and pricing, while China offers long-term volume potential due to low penetration. She concluded that the global fragrance category will remain the strongest in the beauty business.

Ask Fintool Equity Research AI

Answer

CEO Sue Nabi outlined several levers for FY26 growth, including the normalization of retailer inventory levels, two major blockbuster launches, accelerated distribution gains for key Prestige brands like Chloe in the U.S., and expansion in emerging markets. She noted these factors, combined with a potential stabilization in China and Travel Retail, will drive a return to growth.

Ask Fintool Equity Research AI

Answer

President and CEO Stephane de la Faverie confirmed they are on target with PRGP for fiscal 2025, noting gross margin improvements and significant workforce reductions. For fiscal 2026 and beyond, he highlighted an accelerated focus on outsourcing and procurement projects. EVP and CFO Akhil Shrivastava added that these savings fuel the 'Beauty Reimagined' growth agenda and that as sales growth returns, OpEx margin should improve significantly, supporting the goal of a solid double-digit operating margin.

Ask Fintool Equity Research AI

Answer

President & CEO Stephane de la Faverie confirmed they are on track for FY25 PRGP targets, highlighting gross margin improvements and over 2,600 position eliminations. For FY26, the focus is on accelerating outsourcing and procurement projects to achieve a solid double-digit operating margin. EVP & CFO Akhil Shrivastava added that savings are fueling the 'Beauty Reimagined' growth plan and that OpEx margin improvement should accelerate with a return to sales growth.

Ask Fintool Equity Research AI