Infant Formula Recovery

In Q3 2024, Perrigo emphasized strong recovery progress with improvements in production, service levels, and market share driven by remediation and demand‐activation efforts. " " " In Q2 2024, the focus was on near‐full operational recovery, rebuilding inventory and customer service levels with confidence in remediation success. " " "

In Q1 2025, the sentiment remains optimistic with net sales up 19% YoY, a ramp-up in new SKUs (60 new introductions) and continued inventory rebuilding. The improved production metrics and restored on‐shelf presence reinforce the optimism for a strong second half of 2025. " " "

Steady Progress: The narrative remains consistently positive with robust recovery and growth expectations. Optimism and confidence have increased as production efficiencies and SKU introductions drive improved market positioning.

Store Brand Strategy and Momentum

In Q3 2024, discussions highlighted recovery via high in-stock levels, promotional initiatives, and consumer switching, while Q2 2024 focused on margin improvements, net contract gains and SKU rationalization to drive share recovery – including aspects related to infant formula " " " and. " " "

In Q1 2025, Perrigo detailed a strategic pivot in the U.S. store brand business emphasizing improved forecast accuracy, enhanced customer service levels and plans to reintroduce national brand equivalent SKUs. Despite short-term pricing pressures, organic net sales grew and consumer-driven gains are underway. " " " " "

Continued Emphasis with Upward Momentum: The company maintains its focus on store brand growth with enhanced strategic initiatives, even as it navigates competitive pricing actions. The sentiment is cautiously optimistic about future share gains.

Margin Expansion and Cost Efficiencies

Q3 2024 discussions highlighted expanding gross and operating margins driven by initiatives such as Project Energize and supply chain programs, with notable improvements in the Nutrition category and U.S. oral care business. " " Q2 2024 emphasized margin gains through accretive initiatives, SKU rationalization and cost-saving programs achieving significant basis point improvements. " "

In Q1 2025, margin expansion continued robustly with gross margin expanding by 440 basis points to 41% and operating margin by 550 basis points. Benefits from Project Energized and additional supply chain efficiencies underline these gains. " " "

Consistent and Strengthening: Ongoing initiatives continue to drive significant margin improvements. The positive cost efficiency momentum remains intact and even appears enhanced as new cost savings are realized.

Supply Chain Execution and Operational Risks

In Q3 2024, the Supply Chain Reinvention Program delivered significant savings and improved U.S. OTC service levels; Q2 2024 focused on mitigating infant formula production challenges and normalizing inventory levels while detailing operational efficiencies. " " "

Q1 2025 highlights further operational improvements with a 94% global service level, continued inventory rebuild (including the introduction of 60 new SKUs) and strategic measures to manage operational risks amid tariff pressures and macroeconomic uncertainties. " " " "

Enhanced Resilience: There is a clear, ongoing focus on operational excellence and risk mitigation, with proactive measures to address both production challenges and external risks, such as tariffs.

Tariff Mitigation and Associated Risks

There were no explicit mentions of tariff mitigation or related risks in Q3 2024 or Q2 2024 discussions [No citations].

In Q1 2025, tariff risks have emerged as a new focus. Perrigo anticipates a 1% increase to global COGS due to tariffs and is implementing strategic price adjustments, in-sourcing of production and alternative sourcing strategies to mitigate these risks. These actions are expected to fully offset the impact later in the year. " " " " "

New Emerging Focus: This topic is newly introduced in Q1 2025, reflecting increased external cost pressures. The proactive mitigation strategies suggest a heightened management focus on controlling tariff-driven risks that could significantly impact future margins.

Opill Growth and Market Traction

In Q3 2024, Opill’s performance was noted for gaining market share, improving awareness, and achieving repeat rates over 40% with sequential weekly growth. " In Q2 2024, emphasis was placed on solid sell-in/sell-out performance, significant online sales contributions, and effective marketing adjustments to build awareness. "

In Q1 2025, strong organic growth of 5.9% YoY was reported for OTC brands including Opill, alongside increased advertising investments. Consumption for Opill is expected to nearly double, and retailer collaborations are being enhanced to boost visibility and sales momentum. " " "

Accelerating Growth: Opill’s market traction is consistently positive with improved sales, strengthened consumer awareness and rapid consumption growth projections, indicating a high potential for long-term market impact.

Macroeconomic and Demand Uncertainty

Q2 2024 touched on specific demand challenges such as lower seasonal demand for cough/cold products and inventory adjustments, but Q3 2024 did not address broader macroeconomic concerns explicitly. " " "

In Q1 2025, there is an explicit discussion of macroeconomic headwinds. Consumer confidence in the U.S. is at a 12-year low and in Europe at an 18-month low due to inflation, tariffs, and other economic pressures. These challenges have led to lower discretionary spending and adjustments in sales projections for self-care categories. " " "

Heightened Concerns: There is a significant shift with an increased focus on broader economic uncertainties. Compared to earlier periods, Q1 2025 shows a more comprehensive discussion of macroeconomic risks impacting demand, which may affect future performance.