EPS

FY 2025

$2.90 to $3.10 "

$2.9 to $3.1 " "

no change

Gross Margin

FY 2025

approximately 40% "

approximately 40% " "

no change

Net Sales Growth

FY 2025

1.5% to 4.5% "

expected towards the lower end of previously communicated ranges "

lowered

Net Leverage

FY 2025

3.5x "

3.5 times by year-end "

no change

Tariff Impact on COGS

FY 2025

approximately 5.5% (or $145M to $155M) "

$50 million to $60 million (approx 2% of global COGS) "

lowered

Operating Income Growth

FY 2025

no prior guidance

high single-digit range "

no prior guidance

Infant Formula Recovery

Q3 2024 focused on recovery and remediation actions with improved safety stock and high attainment of quality and packaging standards. " " In Q1 2025, the business achieved 19% YoY growth with inventory rebuild and improved shelf availability, though promotional challenges and price gap issues were noted. " " "

In Q2 2025, net sales growth slowed to 9% YoY with operational challenges such as lost distribution for Good Start and an isolated production issue resulting in $11 million of scrapped inventory. The company reintroduced 80% of planned SKUs and adjusted growth expectations due to market volatility. " " " " " "

Recovery remains on track but at a slower pace with more caution, as operational and promotional challenges persist while corrective actions and SKU reintroduction efforts continue.

Store Brand & OTC Growth

In Q3 2024, initiatives drove increased store brand share through marketing and promotions, with retailer investments supporting demand creation. " " " " Q1 2025 highlighted new business awards, 19% infant formula growth, and OTC organic growth of 5.9% amid aggressive shelf resets and consumer shifts. " " "

Q2 2025 saw continued stabilization with signs of OTC growth—evidenced by a 19% increase in allergy product sales at a top customer—and steady store brand performance, even as overall market challenges persist. " "

The growth trajectory remains positive with continued investments in promotions and new SKU introductions, although competitive pressures and market dynamics maintain an undercurrent of caution.

Tariff Impact and Mitigation

In Q1 2025, tariffs were expected to cause a 1% gross increase in global COGS, primarily affecting the U.S. oral care segment. Mitigation strategies included strategic pricing actions, in-sourcing manufacturing, and exploring alternative supply routes. " " " "

Q2 2025 reports a higher projected impact, with expected increases of $10–20 million in Q4 and $50–60 million for the full year. The company continues to mitigate these impacts with strategic pricing and supply chain optimizations, including further insourcing. " "

There is an increased focus on managing higher tariff impacts with proactive pricing and supply chain strategies, reflecting a more acute concern even though mitigation efforts remain consistent.

Operational and Quality Controls

Q3 2024 stressed robust infant formula quality through self-remediation actions, supply chain programs, and significant savings via operational efficiency initiatives. " " " Q1 2025 emphasized improved service levels, efficient manufacturing operations, and active FDA engagement to ensure quality and reliability. " " " "

In Q2 2025, despite an isolated production issue that led to $11 million in inventory scrap, the company reinforced that its comprehensive quality-assured manufacturing processes and corrective actions remain effective. " "

The emphasis on quality and operational controls is consistent, with isolated hiccups managed effectively; the sentiment remains confident with continuous improvements despite occasional production variabilities.

Supply Chain Execution Risks

Q3 2024 and Q1 2025 discussions centered on improving operational efficiency via a supply chain reinvention program, enhanced service levels, and tariff mitigation through alternative sourcing and pricing adjustments. " " " " "

In Q2 2025, while no explicit mention of “execution risks” was made, discussions around isolated production issues and ongoing tariff impacts imply that supply chain challenges are being actively managed through quality systems and strategic initiatives. " " "

There is minimal change in sentiment. Although risks remain, proactive initiatives and improvements from prior periods continue to mitigate operational challenges effectively.

Strategic Pricing & Demand Generation Initiatives

In Q3 2024, favorable pricing contributed to margin expansion and demand generation initiatives—via online promotions, expanded infant formula marketing, and a GLP-1 related program—were highlighted. " " " " Q1 2025 discussed strategic pricing actions for tariff mitigation, closing infant formula price gaps, and ramping up demand through shelf resets and new SKU introductions. " " " "

In Q2 2025, the company continues to deploy strategic pricing measures to offset tariff impacts while enhancing demand generation efforts for infant formula through targeted promotions and improved in‐store marketing. " " " "

The focus remains steady with refined and ongoing initiatives. The company is consistently adapting pricing strategies and promotional activities to effectively manage market and tariff challenges.

Macroeconomic Uncertainty

Q1 2025 acknowledged significant macroeconomic challenges, including contraction in self-care sales, inflation, tariffs, and subdued consumer confidence, leading to cautious consumer behavior and widened net sales projections. " " "

In Q2 2025, macroeconomic uncertainty continues to influence consumer behavior, with a shift toward value-driven store brands amid slowing category consumption in the U.S. and EU. " " "

Persistent headwinds remain, as economic uncertainty continues to shape consumer spending patterns. While the company adjusts its strategies accordingly, caution prevails in both periods.

Opill Growth Dynamics

Q3 2024 noted that Opill was gaining momentum with over 40% repeat rates and improving trial awareness, though there was room for further optimization. " Q1 2025 reported significant contributions from Opill—with retail stocking benefits and expectations for nearly double consumption, supported by higher promotional investments. " "

Q2 2025 reports strong performance with consumption doubling and repeat purchase rates rising to 55%. There is an active focus on brand expansion and a more comprehensive women's health category under the “O” brand. "

The growth dynamics of Opill have accelerated positively, with improved repeat rates and stronger brand expansion initiatives compared to prior periods. The sentiment is increasingly upbeat about its long-term potential.

Competitive Pricing Pressures

In Q3 2024, national brands used promotions to recover lost volumes, slightly narrowing the price gap after a period of widening, prompting close monitoring for future trends. " Q1 2025 highlighted that competitive promotions by domestic brands temporarily reduced the price gap between national and store brands, slowing store brand share recovery. "

Q2 2025 continues to see significant competitive pricing pressures. Heavy promotional activities, suboptimal shelf placement, and ongoing competitive dynamics in the infant formula segment appear to challenge share gains, although long-term improvements are expected. " "

Competitive pricing pressures remain persistent across the periods. Despite proactive adjustments, the market remains volatile with ongoing challenges that necessitate continual efforts to preserve pricing advantages and store brand value.