Q3 2025 Church & Dwight Co Inc Earnings Call

October 31, 2025

Yeah.

Remind you that on this call the company's management may make forward looking statements regarding among other things the company's financial objectives and forecasts.

[music].

These statements are subject to risks and uncertainties and other factors that are described in detail in the Companys SEC filings.

I would now like to introduce your host for today's call. Mr. Richter, President and Chief Executive Officer of Church and Blake.

Please go ahead Sir.

Alright, Thank you and good morning, everyone. Thanks for joining the call I'll begin with some thoughts on the macro environment and then review of our great.

Q3 results and then I'll turn the call over to Lee Mcchesney, Our CFO and then when Lee is done we'll open up for questions.

Speaker #1: Good morning, ladies and gentlemen, and welcome to Church & Dwight's third quarter 2025 earnings conference call. Before we begin, I've been asked to remind you that on this call, the company's management may make forward-looking statements regarding, among other things, the company's financial objectives and forecasts.

Starting with the broader environment conditions remain volatile in the consumer backdrop remains mixed promotional intensity is elevated in some categories and household finances are stretched as high borrowing car costs and delinquencies way on discretionary spending including big ticket items like cars and housing. However, there is relatively lower unemployment and higher price personal care.

Speaker #1: These statements are subject to risks and uncertainties, as well as other factors that are described in detail in the company's SEC filings. I would now like to introduce your host for today's call, Mr. Rick Dierker, President and Chief Executive Officer of Church & Dwight.

Our categories continue to do well.

Against that mixed backdrop, our categories are growing at around 2%, which was pretty consistent with what happened in Q2 as well.

Speaker #1: Please go ahead, sir.

We're performing better than that because of our great brands.

Speaker #2: All right. Thank you. Good morning, everyone. Thanks for joining the call. Again, with some thoughts in the macro environment, and then review of our great Q3 results.

Our portfolio with its balance of value and premium offerings continue to gain both dollar and volume share our innovation is performing well and all in all our brands are made for environments like this.

Speaker #2: Then I'll turn the call over to Lee McChesney, our CFO, and then when Lee is done, we'll open up for questions. Starting with the broader environment, conditions remain volatile, and the consumer backdrop remains mixed.

Under the Q3 results, we had a fantastic quarter in a tough environment organic sales grew three 4% exceeding our outlook of 1% to 2% adjusted.

Speaker #2: Promotional intensity is elevated in some categories, and household finances are stretched, as high borrowing costs and delinquencies weigh on discretionary spending. Including big-ticket items like cars and housing.

Adjusted gross margin was up 10 basis points also exceeding our outlook adjusted EPS was <unk>, <unk>, which was <unk> <unk> higher than our 70 <unk> outlook Lee will take you through the rest of the numbers shortly but first some highlights about our brands.

Speaker #2: However, there is relatively low unemployment, and higher priced personal care categories continue to do well. Against that mixed backdrop, our categories are growing at around 2%.

In July we closed our most recent acquisition touchline touched on is the fastest growing brand in the hand sanitizer category in the U S.

Speaker #2: Which was pretty consistent with what happened in Q2 as well. We're performing better than that because of our great brands. Our portfolio, with its balance of value and premium offerings, continues to gain both dollar and volume share.

The number to hand sanitizer in the category with household penetration just under 7% and the category at 42%, indicating a lot of runway for growth.

Speaker #2: Our innovation is performing well, and all in all, our brands are made for environments like this. Onto the Q3 results. We had a fantastic quarter and a tough environment.

<unk> experienced strong growth in Q3 with consumption growing double digits and our results exceeded our initial expectations I'm, even more optimistic about touched on today than even a few months ago, a small, but mighty team doing great things now.

Speaker #2: Organic sales grew 3.4%, exceeding our outlook of 1% to 2%. Adjusted gross margin was up 10 basis points, also exceeding our outlook. Adjusted EPS was $0.81, which was $0.09 higher than our $0.72 outlook.

Now I'm going to turn my comments to each of the three divisions first up is the U S consumer business organic sales increased two 3% with volume growth of three 7%.

Speaker #2: Lee will take you through the rest of the numbers shortly. But first, some highlights about our brands. In July, we closed our most recent acquisition, Touchline.

Being partially offset by one 4% of price mix growth was led by a Thoroughbred mouthwash.

Speaker #2: Touchline is the fastest growing brand in the hand sanitizer category in the US. It's the number two hand sanitizer in the category, with household penetration just under 7%, and the category at 42%, indicating a lot of runway for growth.

Arm <unk> Hammer cat litter, and Trojan condoms, partially offset by declines in the vitamin business and water Pik waterflood yours.

We grew share in four of our eight power brands, specifically arm <unk> Hammer Thoroughbred hero and <unk>, let me provide a bit of color for a few of our important categories.

Speaker #2: Touchline experienced strong growth in Q3, with consumption growing double digits, and results exceeded our initial expectations. I'm even more optimistic about Touchline today than even a few months ago.

I'd like to start off with the arm <unk> Hammer brand in general consumers.

Consumers today want stability and brands. They can trust, our new campaign give it the whole darn arm reinforces the brand strength and reliability. This is driving growth across the portfolio.

Speaker #2: A small but mighty team doing great things. Now I'm going to turn my comments to each of the three divisions. First up is the US consumer business.

Six categories, we compete in with arm <unk> hammer or growing share on a year to date basis.

Speaker #2: Organic sales increased 2.3%, with volume growth of 3.7%, partially offset by a 1.4% price mix. Growth was led by Therabreath mouthwash, acne products, Arm & Hammer cat litter, and Trojan condoms.

Turning to laundry detergent arm <unk> hammer liquid laundry detergent consumption grew one 9% in contrast to a flat category arm <unk> hammer share in the quarter reached 15% beyond share and more importantly household penetration for the long term continues to matter and in the quarter arm <unk> Hammer laundry expanded household penetration.

Speaker #2: Partially offset by declines in the vitamin business and water flossers. We grew share in four of our eight power brands, specifically Arm & Hammer, Therabreath, Hero, and Touchline.

Speaker #2: And let me provide a bit of color for a few of our important categories. I'd like to start off with the Arm & Hammer brand in general.

0.7 points to an all time high of 30% in fact, the only tier of laundry detergent that was positive consumption in the quarter was the valued here. This is a sign of the times is value was flat to declining in the previous eight quarters. This is especially impressive as our actual promotional spending for laundry was lower year over.

Speaker #2: Consumers Turning to laundry detergent, Arm & Hammer liquid laundry detergent consumption grew 1.9%, in contrast to a flat category. Arm & Hammer share in the quarter reached 15%.

Speaker #2: today want stability in brands they can trust. Our new campaign, "Give it the whole darn arm," reinforces the brand's strength and reliability. This is driving growth across the portfolio: five of the six categories we compete in with Arm & Hammer are growing share on a year-to-date basis.

A year.

Moving to litter arm <unk> hammer litter consumption grew five 3%, while the category was up five.

We saw heightened competitive promotions, especially in our lightweight segment by one competitor.

Over to mouthwash thorough breath continues to perform extremely well, while the mouthwash category was down in Q3 Thoroughbred consumption grew 17%.

Speaker #2: Beyond share, and more importantly, household penetration for the long term continues to matter. In the quarter, Arm & Hammer laundry expanded household penetration by 0.7 points to an all-time high of 30%.

To be the number two mouthwash with 21, 8% sure remember we believe Theres a lot of runway here our household penetration for thorough breath currently sits at 11% versus the category of 65% here.

Speaker #2: In fact, the only tier of laundry detergent that was positive consumption in the quarter was the value tier. This is a sign of the times, as value was flat to declining in the previous eight quarters.

<unk> once again outpaced the category with consumption growth of five 2% compared to a flat Acme category and remains the number one brand in acne care with a 23, 6% share and length of therapy. Perhaps story. We believe household penetration growth is key for this brand it sits at 9% versus the category of 28%.

Speaker #2: This is especially impressive, as our actual promotional spending for laundry was lower year over year. Moving to litter, Arm & Hammer litter consumption grew 5.3%, while the category was up five.

Speaker #2: We saw heightened competitive promotions, especially in the lightweight segment by one competitor. Over to mouthwash, Therabreath continues to perform extremely well. While the mouthwash category was down in Q3, Therabreath consumption grew 17%.

Looking ahead, we're excited about our pipeline of new products, we have announced a few today there.

They are a key driver of our success their breath is introducing a new line of toothpaste.

Watched online the three variance in August and they target key consumer needs of healthy gums deep cleaning and widening all combined with long lasting fresh breath.

Speaker #2: And continues to be the number two mouthwash, with a 21.8% share. Remember, we believe there's a lot of runway here. Our household penetration for Therabreath currently sits at 11%.

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The brands loyal users value, it's effective cleaning the distinctive fresh but not overpowering taste, we have a retail launch set for January 2026, we're very encouraged with the high quality consumer reviews foreseen.

Speaker #2: Versus the category of 65%, here we have once again outpaced the category with consumption growth of 5.2% compared to a flat acne category, and we remain the number one brand in acne care, with a 23.6% share.

Meanwhile, Trojan the number one condom brand U S launched Trojan goat greatest of all Trojan, which is a non latex condom featuring patent pending ultra flex material that soft flexible odorless and colorless designed to enhance body heat transfer to deliver next level of intimacy.

Speaker #2: And like the Therabreath story, we believe household penetration growth is key for this brand. It sits at 9% versus the category of 28%. Looking ahead, we're excited about our pipeline of new products.

Yes.

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Speaker #2: We even announced a few today. They're a key driver of our success. Therabreath is introducing a new line of toothpaste, we launched online with three variants in August, and they target key consumer needs of healthy gums, deep cleaning, and whitening, all combined with long-lasting fresh breath.

Turning to international our National business.

Business delivered sales growth of eight 4% in the quarter organic increased seven 7% due to a combination of higher volume price and mix growth was led by the hero third breath and boutique brands and was broad based across many of our international markets. I was just in Argentina, two weeks ago with our global markets group and distributor partners.

Speaker #2: The brand's loyal users value its effective cleaning, distinctive fresh but not overpowering taste, and we have a retail launch set for January 2026. We're very encouraged with the high quality consumer reviews we're seeing.

And there is a lot of excitement for the future.

Finally, SPD organic sales increased four 2% due to a combination of higher price and product mix and volume we continue to be excited about the growth opportunities in this business.

Speaker #2: Meanwhile, Trojan, the number one condom brand in the US, launched Trojan Goat, greatest of all Trojan, which is a non-latex condom, featuring patent-pending ultra-flex material that's soft, flexible, odorless, and colorless, designed to enhance body heat transfer to deliver next-level intimacy.

As noted previously we are undertaking a strategic review of our vitamin business, including streamlining our supply chain to strengthen the core business, new JV partnership opportunities and divestiture options. We're seeking we're seeing improved velocities in the core in.

Speaker #2: Turning to international, our international business delivered sales growth of 8.4% in the quarter. Organic increased 7.7% due to a combination of higher volume, price, and mix.

And line reviews are receiving positive retailer feedback on new products and long term brand strategy. We continue to expect to reach a conclusion from this review by the end of 2025.

Speaker #2: Growth was led by the Hero Therabreath and Patisse brands, and was broad-based across many of our international markets. I was just in Argentina two weeks ago with our global markets group and distributor partners, and there is a lot of excitement for the future.

Looking ahead, our full year organic growth outlook is 1% the midpoint of our prior range. We expect full year adjusted EPS growth through 2025 to now be $3 49, or <unk> higher than our previous outlook due to higher sales and improved margins.

Speaker #2: Finally, SBD organic sales increased 4.2% due to a combination of higher price and product mix, and volume. We continue to be excited about the growth opportunities in this business.

Including higher marketing spend.

As in past years, when we have stronger than expected business performance, we invest for the future. So we now expect marketing as a percentage of the sale of sales to exceed 11% and these investments will continue our momentum into 2026.

Speaker #2: As noted, previously, we're undertaking a strategic review of our vitamin business, including streamlining our supply chain to strengthen the core business, new JV partnership opportunities, and divestiture re options.

Speaker #2: We're seeking improved velocities in the core and line reviews are received in positive retailer feedback on new products and long-term brand strategy. We continue to expect to reach a conclusion from this review by the end of 2025.

Close by saying that category consumption remained stable and our brands remain in a position of strength, we're gaining dollar dollar and volume share across key segments of the portfolio.

Courted by a balanced mix of value and premium offerings, we are well positioned to navigate the current environment. The strategic actions. We are executing will set us up for sustained success. Our go forward portfolio has never been stronger at.

Speaker #2: Looking ahead, our full-year organic growth outlook is 1%. The midpoint of our prior range, we expect full-year adjusted EPS growth for 2025 to now be 3.49 or 2 cents higher than our previous outlook.

At the same time, we remain active in evaluating the right acquisition opportunities to further build our business I'm excited to speak at Investor Day in January about some of the growth initiatives. We have in development with that I'd like to close by thanking all of the church <unk> Dwight employees for executing well in a volatile environment and now I'll hand, the call over to Lee for more detail on the quarter.

Speaker #2: To the higher sales and improved margins. Including higher marketing spend. As in past years, when we have stronger-than-expected business performance, we invest for the future.

Speaker #2: So we now expect marketing, as a percent of sales, to exceed 11%, and these investments will continue our momentum into 2026. I'll close by saying that category consumption remains stable, and our brands remain in a position of strength.

Thank you Rick and good day to everyone on this Halloween and Friday, our church <unk> Dwight team members across the globe delivered a quarter to be proud of highlights once against the many strengths of our portfolio and our team's capabilities.

Speaker #2: We're gaining dollar and volume share across key segments of the portfolio. Supported by a balanced mix of value and premium offerings, we're well positioned to navigate the current environment.

Jumping to the third quarter and our outlook, we'll start with EPS third quarter adjusted EPS was <unk> 81.

Speaker #2: The strategic actions we're executing will set us up for sustained success. Our go-forward portfolio has never been stronger. At the same time, we remain active in evaluating the right acquisition opportunities to further build our business.

Up two 5% from the prior year to 81 was better than our 72 cent outlook driven by higher volume and gross margin results favorable to our outlook.

Reported revenue was up 5% and organic sales were up three 4%.

Speaker #2: I'm excited to speak at Investor Day in January, about some of the growth initiatives we have in development. With that, I'd like to close by thanking all of the CHURCH & DWIGHT employees for executing well in a volatile environment, and now I'll hand the call over to Lee for more detail on the quarter.

The organic sales was broad based across the globe with volume growth of 4%, partially offset by negative pricing and mix of 6%.

And beyond organic results, we were delighted with the encouraging start of touch Lind our sales exceeded our initial projections are.

Speaker #2: Thank you, Rick, and good day to everyone on this Halloween Friday. Our Church & Dwight team members across the globe delivered a quarter to be proud of that highlights, once again, the many strengths of our portfolio and our team's capabilities.

Our third quarter adjusted gross margin was 45, 1% at <unk>.

10 basis point increase from a year ago, and 110 basis points better than our outlook.

Speaker #2: Let's jump into the third quarter and our outlook. We'll start with EPS. Third quarter adjusted EPS was $0.81, up 2.5% from the prior year.

Our results versus last year were driven by 170 basis points from productivity programs 20 basis points from higher margin acquisitions 10 basis points from FX and 10 basis points from the combination of volume price and mix. These factors offset 200 basis points of inflation and tariff costs.

Speaker #2: The 81 cents was better than our 72 cent outlook, driven by higher volume, and gross margin results favorable to our outlook. Reported revenue was up 5%.

Speaker #2: Organic sales are up 3.4%. The organic sales growth was broad-based across the globe, with volume growth of 4%, partially offset by negative pricing and mix of 0.6%.

Moving to marketing or marketing expense as a percentage of sales was 12, 8% or 50 basis points higher than the third quarter of last year and.

And for the year, we are now targeting to exceed 11% of net sales as we leverage our improved sales growth to invest for the future.

Speaker #2: And beyond organic results, we were delighted with the encouraging startup Touchland, a sales exceeded our initial projections. Our third quarter adjusted gross margin was 45.1%.

Q3, adjusted SG&A increased 20 basis points year over year adjusted other expense increased by $3 9 million due to the lower interest income compared to last year.

Speaker #2: A 10 basis point increase from a year ago, and 110 basis points better than our outlook. Our results versus last year were driven by 170 basis points from productivity programs, 20 basis points from higher margin acquisitions, 10 basis points from FX, and 10 basis points from the combination of volume, price, and mix.

And we continue to expect other expense for the full year to be approximately $65 million on an adjusted basis, reflecting the lower interest income following the touch on acquisition.

In <unk>, our adjusted tax rate was 21, 6% compared to $23. Three in Q3 of 24 170 basis point year over year decrease in.

And the expected adjusted effective tax rate for the year is now 22, 5%.

And now to cash we delivered strong cash results in the quarter as cash flow from operations increased 19, 6% versus last year to $435 5 million.

Capital expenditures for the first nine months were $67 2 million a $58 million decrease from the prior year due to return to normalized capital spending in 2025.

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And finally in the third quarter the company repurchased an additional $300 million of shares which brings our year to date share repurchases up to 600 million for our shareholders.

Certainly a third quarter full of accomplishments.

Now turn to our outlook broadly, we continue to navigate well in an environment of economic uncertainty.

And as a result have improved our outlook in several areas.

For the year, we now expect reported sales growth of approximately one 5% versus the prior year mid point view of one point out as we expect touch on this momentum to continue in the fourth quarter.

We also remain on track to deliver 2025 organic growth of approximately 1% the midpoint of our previous outlook.

And we now expect full year gross margin to contract only 40 basis points versus 2024 based on the progress our teams are delivering from productivity programs to counter inflation and tariff headwinds.

And as I noted earlier, the combination of a stronger sales and gross margin outlook allows us to increase our marketing investments beyond our prior outlook in 2025 for.

For the year, we now expect an adjusted EPS of $3 49.

Which exceeds the midpoint of our prior outlook and.

And specifically for <unk>, we now expect reported sales growth of approximately three 5% and an organic sales growth of approximately one 5%.

In <unk> I would note that our reported sales our outlook includes a larger decline in sales from our discontinued businesses as these product lines run out of inventory and for some context, we expect $30 million of lower sales or 200 basis points back in the.

The fourth quarter versus last year.

Mrs.

It also note an organic growth of <unk> was impacted by the prior year port strike and the negative consumption trends in our Vms business.

<unk>, our adjusted gross margin will contract approximately 50 basis points, primarily from inflation and tariff costs marketing will be lower compared to last year.

For the year. We now expect an adjusted EPS of $3.49 which exceeds the midpoint of our prior Outlook.

When you bring it all together, we expect an adjusted EPS <unk> 83 per share, which is an increase of 8% versus last year's adjusted EPS.

And specifically for 4 q. We now expect reported sales growth of approximately 3.5% and an organic sales growth of approximately 1 and a half percent.

And my final twenty-five comment on the outlook really covers cash flow from operations as noted in our press release, we have increased our outlook from $1 1 billion to $1 2 billion in consideration of our progress on several fronts.

As our teams look forward, we are optimistic our teams across the globe have delivered significant accomplishments. We continue to fuel share gains we've made strategic choices to exit brands in our portfolio. We've acquired touchless, which is off to a great start and we returned $600 million to our shareholders through share repurchases.

In 4 q. I note that our reported sales Outlook includes a larger decline in sales from our discontinued businesses as these product lines, run out of inventory. And for some context, we expect 30 million of lower sales or 200 basis points to drag in the fourth quarter versus last year, from these discontinued businesses

It also note, and our organic growth for 4. Q is impacted by the prior year Port strike and the negative consumption Trends in our VMS business.

A big thank you to our employees across the globe for leaning forward and executing through the first three quarters of the year very well done.

In 4 q are just the gross margin of contract, approximately 50 basis points, primarily from inflation. And tariff costs marketing will be lower compared to last year.

Eric let's move to Q&A.

We expect an adjusted EPS 83 cents per share, which is an increase of 8% versus last year's adjusted eps.

Okay.

We will now begin the question and answer session. So I'd like to ask a question. During this time simply press star followed by the number one on your telephone keypad.

Your first question comes from the line of Chris Terry with Wells Fargo Securities. Please go ahead.

Of our progress on several fronts.

Hi, Good morning, everyone. Good morning, Chris.

So touch land is.

Is coming through better than expected.

Which is great to see.

Can you talk about how you might view the benefits.

As our teams look forward. We are optimistic, our teams across the globe have delivered significant accomplishments. We continue to fuel share gains. We've made strategic choices to exit brands in our portfolio. We've acquired a touchland, which is off to a great start and we've returned million dollars to our shareholders through share of purchases.

Touch land going into 2026.

And specifically how might the positive contribution from touch lay on to help offset any of the potential profit outcome you could envision from actions you may take on the vitamin business and I have a follow up.

A big thank you to our employees across the globe for leading forward and executing through the first three quarters of the year. Very well done.

Eric, let's move to Q&A.

Okay.

Good morning, ladies and gentlemen, and welcome to Church <unk> Dwight third quarter 2025 earnings Conference call.

Yes, I mean, we're going to.

Before we begin I have been.

We will now begin the question-and-answer assessment. If you'd like to ask a question during this time, simply press Start, followed by the number 1 on your telephone keypad.

To remind you that on this call the company's management may make forward looking statements regarding among other things the company's financial objectives and forecasts. These.

I guess the first thing is you're right Touchstone is doing fantastic, even better than we expected better than our double digit comment last quarter.

Your first question comes from the line of Chris Terry with Wells Fargo Securities. Please go ahead.

Consumption strong units per store per week are really strong innovation.

Payments are subject to risks and uncertainties and other factors that are described in detail in the company's SEC filings.

Hi, good morning everyone. Good morning Chris.

His strong collaborations are strong.

<unk>.

I'm not going to really talk too much about 2026 at this point I would just say.

I would now like to introduce your host for today's call Mr. Rick.

So, uh, touch land is coming through better than expected.

Which is great to see.

<unk> five is doing better than we expect it means there's going to be a stronger baseline.

President and Chief Executive Officer of Church <unk> Dwight.

Please go ahead Sir.

And as we grow that of course will help offset anything from the discontinued businesses or potentially anything with vitamins as well.

Alright, Thank you and good morning, everyone and thanks for joining the call I'll begin with some thoughts on the macro environment and then review of our Great Q3 results and then I'll turn the call over to Lee Mcchesney, Our CFO and then when Lee is done we'll open up for questions.

Can you talk about how you might view the benefits of touch land going into 2026?

And Chris the only I would know just do keep in mind, we had a good amount of cash on our on our books we are earning.

Interest on and obviously it will be a little bit of a headwind versus touch late next year as well.

And specifically how my the positive contribution from touchland help offset any of the potential profit outcomes. You could Envision from actions you, you may take on the vitamin business that I have a follow-up.

Okay.

The follow up is just on the competitive environment picking up a bit.

I think you mentioned that your laundry promotional activity was actually down a bit relative to last year just to confirm that.

Care categories continued to do well.

Yeah, I mean we're going to uh, I guess, the first thing is, you're right. Touchland is doing fantastic. Even better than we expected. Uh, better than our double-digit comment last quarter. Uh, consumption strong units. For 2 or per week are really strong. Innovation is is strong. Collaborations are strong. Uh,

Against that mixed backdrop, our categories are growing at around 2%, which was pretty consistent with what happened in Q2 as well, we're performing better than that because of our great brands.

And in General how would you view that.

The competitive backdrop, right now and and your potential need.

Need to respond to any activity.

That youre seeing and maybe just a level of confidence that the really strong.

Not going to really talk too much about 2026 at this point. I would just say, uh, 2025 is doing better than we expect. It means that there's going to be a stronger Baseline, uh, and as we grow that, of course, will help offset anything from the discontinued businesses, or potentially anything with vitamins as well too.

Volume share performance that you've been delivering is sustainable and what might be needed to sustain that level of execution. Obviously you have.

Onto the Q3 results, we had a fantastic quarter in a tough environment organic sales grew three 4% exceeding our outlook of 1% to 2%.

And Chris doning, I would would know, just, you know, do keep in mind, we had, you know, good amount of cash on our on our books. We were earning, uh, interest on. And obviously, that would be a little bit of a headwind versus touchland next year as well.

You've kind of teased innovation plans for next year, but also just the potential level of brand support. Thanks, so much.

Adjusted gross margin was up 10 basis points also exceeding our outlook adjusted EPS was a one sentence, which was 9% higher than our 72 outlook Lee will take you through the rest of the numbers shortly but first some highlights about our brands.

Okay. Um, the follow-up is just on the competitive environment.

Yes, Thanks, Chris Yeah for laundry.

In my prepared comments I said, it and I think it's such a impactful statement.

For the first time in eight quarters, the value tier of laundry grew and that was.

In July we closed our most recent acquisition touchline.

That's one of the fastest growing brand in the hand sanitizer category in the U S.

If you look year over year, an amount sold on deal, which again remember that depth and frequency.

Two hand sanitizer in the category with household penetration just under 7% and the category at 42%, indicating a lot of runway for growth.

So that is where we were down 400 basis points year over year.

That's one experienced strong growth in Q3 with consumption growing double digits and our results exceeded our initial expectations.

Competition was up between 300 600 basis points, depending on what brand.

No.

I believe that is.

Even more optimistic about touched on today than even a few months ago, a small but mighty team doing great. Thanks.

A trend that starting to happen in the category as consumers are pressed.

We're kind of slowly move into value, which is great.

Now I'm going to turn my comments to each of the three divisions first off is the U S consumer business.

Yeah.

That is.

Picking up a bit. Um I think you mentioned that your laundry promotional activity was actually down a bit relative to last year. Just let's confirm that um and and and in general you know how would you view you know the the the competitive backdrop right now and and your potential uh you know need to respond to any activity you know that that you're seeing and maybe just a level of confidence that the really strong. Um you know volume share performance that you've been delivering is is um you know sustainable and and what might be needed to sustain, you know that level of execution obviously you have uh you you kind of teased Innovation plans for next year but also just the potential level of of brand support. Thanks so much.

That is one piece of it.

<unk> sales increased two 3% with volume growth of three 7%.

Another indication is even the pod category, which is around 23% of the category. That's the most expensive form of laundry detergent rate two times liquid that's been flat the category for the last six quarters. So those are just indications.

Being partially offset by one 4% of price mix growth was led by a therapy, that's not what I.

Any products arm <unk> hammer cat litter, and Trojan condoms, partially offset by declines in the vitamin business and water Pik waterflood yours.

The value.

Grew share in four of our eight power brands, specifically arm <unk> hammer their breath hero and touched one.

Value matters, and so if promotional intensity does tick up I think overall, we're in a great spot value is doing well and even some of our higher price competitors. They are twice the cost of our laundry detergent. So they would have to do massive discounts to.

Let me provide a bit of color for a few of our important categories I'd like to start off with the arm <unk> Hammer brand in general.

Consumers today want stability and brands. They can trust, our new campaign give it the whole darn arm reinforces the brand strength and reliability. This is driving growth across the portfolio.

That is where we were down. 400 basis points year-over-year. Uh, our competition was up between 300 and 600 basis points, depending on what brand. So,

To move any elasticity. So again I think we're well positioned I think this is starting to be a little bit of a trend in the category for consumers seeking value.

I, I believe that is uh a trend that's starting to happen in in the category, as consumers are pressed, you know, they're, they're kind of slowly moving to Value, which is great. Um,

The six categories, we compete in with arm <unk> hammer or growing share on a year to date basis.

That is.

Yeah.

Your next question comes from the line of.

Peter Grom with UBS.

Please go ahead.

Okay.

Breaking up a little bit.

Okay.

Not really.

<unk> seven points to an all time high of 30% in fact, the only tier of laundry detergent that was positive consumption in the quarter was the valued here. This is a sign of the times is value was flat to declining in the previous eight quarters. This is especially impressive as our actual promotional spending for laundry was lower year over year.

Okay.

Or do you try to reconnect and we'll make sure you get back and so.

Yes.

Okay.

Your next question comes from the line of.

We will pass Perique with Oppenheimer.

Please go ahead.

Morning, and thanks for taking my question. So I guess just go into international another strong quarter, even on a difficult comparison. So just curious are you guys seeing any changes there macro consumer wise and how do you feel about sustaining momentum in the international segment for the balance of the year.

<unk>.

Moving to litter arm <unk> hammer litter consumption grew five 3%, while the category was up five.

That is 1 piece of it. Uh, you know, another indication is even the pods category, which is, you know, around 23% of the category. It's the most expensive form of laundry, detergent, write 2 times liquid. That's been flat the category for the last 6, quarters. So those are just indications that the value, um, value value matters. And so, if promotional intensity does pick up, I think, um, overall, we're in a great spot value is doing well and even some of our higher price competitors, they're twice the, the cost of our laundry detergent. So they would have to do massive discounts to, to move any elasticity. So again, I think we're well positioned, I think this is starting to be a little bit of a trend, uh, in the category for for consumers, seeking value.

We saw heightened competitive promotions, especially in the lightweight segment by one competitor.

Over to mouthwash their breath continues to perform extremely well, while the mouthwash category was down in Q3 third breath consumption grew 17%.

Your next question comes from the line of Peter grow with UBS.

As I said I was just in Argentina, a couple of weeks ago with 300, plus people and there's a ton of excitement about our brands and the growth profile of some of our given our new brands like their breath and hero and touch line, so even as the macro.

Please go ahead.

Or break it up a little bit.

To be the number two mouthwash with 21, 8% sure remember we believe Theres a lot of runway here our household penetration for Thoroughbred currently sits at 11% versus the category of 65% CRE.

Not really.

GDP starts to slow and some of these countries.

Well, you try reconnecting, and we'll make sure you get back in. So.

<unk> of these brands, which bring problem solution brands innovation, new categories, a lot of excitement to continue to deliver.

<unk> once again outpaced the category with consumption growth of five 2% compared to a flat acne category and remains the number one brand in acne care with a 23, 6% share and length of therapy that story. We believe household penetration growth is key for this brand.

Against our really our evergreen model for international So a lot of momentum in our international business.

Your next question comes from the line of rupesh Parikh with Oppenheimer.

Please go ahead.

Great and then maybe just one quick follow up.

At 9% versus the category of 28%.

Share buybacks again, another quarter of significant buybacks you thought your stock would obviously pull backs, which does anything change in terms of your priorities share buybacks versus M&A or should we just expect you to continue to be opportunistic based on what your stock does.

Looking ahead, we're excited about our pipeline of new products, we have announced a few it today there.

Good morning and thanks for taking my question. So I guess I guess just just go ahead and international another strong quarter even on a difficult comparison. Uh, so just curious. Are you are you guys seeing any changes there? You know, macro consumer wise and um, how do you feel about sustaining momentum in the international segment for the balance of the year?

There are a key driver of our success their breath is introducing a new line of toothpaste.

Yeah, as I said, I was just in Argentina a couple of weeks ago with 300 plus.

Watched online the three variance in August and they target key consumer needs of healthy gums deep cleaning and widening all combined with long lasting fresh breath. The brands loyal users value. It's effective cleaning this distinctive fresh but not overpowering taste, we have a retail launch set for January 2026, we're very <unk>.

and there's a ton of excitement.

Yeah. So good question so to your point.

We definitely took advantage of.

The value opportunity there.

We typically try to just.

Our partners at parties aren't we wanted to we want to focus on M&A.

Number one focus of our cash.

And we're out in the market accordingly, but if any opportunities come up to maybe accelerate a little bit of our share.

<unk> with the high quality consumer reviews, we're seeing.

For Brands and the growth profile of some of our even our new brands like Thera breath and hero and, and, and touchland. So, even as the macro, uh, you know, GDP starts to slow. And some of these countries, uh, the Tailwind of of these Brands which bring, you know, problem solution Brands, Innovation new categories, a lot of excitement uh to continue to deliver against our our really our Evergreen model for international. So

Share buybacks, we'll do that as we sit here today.

a lot of momentum in our international business,

We've done everything we've done with the $600 million, we bought <unk>.

We've got great cash flow balance sheets in a good place as we look forward we'll.

Refresh we're still focused on an M&A theres still opportunities out there and.

Turning to international R&R, but not a national business delivered sales growth of eight 4% in the quarter organic increased seven 7% due to a combination of higher volume price and mix growth was led by the hero thorough breath and Batiste brand and was broad based across many of our international markets I was just in Argentina, two weeks ago with.

Right. And then maybe just 1 quick follow-up, uh, you know, to share BuyBacks again, you know another quarter of significant BuyBacks, uh, you know, you stock, your stock is obviously pulled back, so does anything change in terms of your priorities, share BuyBacks versus m&a? Or should we just expect you to continue to be opportunistic based on what your stock does?

And we obviously have an opportunity to do M&A.

And.

We've just gone through.

Our review we just you just recently saw our shares our treasury balance sheet get upgraded as well. So I mean I just think on many fronts. We got a quality balance sheet strong cash flow gives us a lot of optionality, so frankly with the potential to do that but to do both things.

Our global markets group and distributor partners and there is a lot of excitement for the future.

Finally, SPD organic sales increased four 2% due to a combination of higher price and product mix and volume we continue to be excited about the growth opportunities in this business.

Great. Thank you.

Your next question comes from the line of Bonnie Herzog with Goldman Sachs.

Please go ahead alright.

Thank you good morning, everyone.

I had a question on the promotional environment, hoping just some more color on that and then your volume growth.

Yeah, so good question. So to your point, um, yeah, we we definitely took advantage of of the, the value opportunity there. Um, you know, we we typically try to just um, you know, you know, our part is parties are we want to, we want to focus on m&a. Um, this is our number 1 focus of of our cash. Um, and you know, we're we're out in the market accordingly. Um, but if any opportunities come up to maybe accelerate a little bit of our, um, share BuyBacks, you know, we'll do that as, as we sit here today. Um, you know, we've done everything we've done with the 600 million dollars, we bought touchland, you know, we got great cash flow, balance sheets in a good place as we look forward. Um, you know, with professionals are still focused on on m&a. There's still opportunities out there and uh,

um,

It was quite strong in the quarter, but price mix was slightly negative so I guess could.

And line reviews are receiving positive retailer feedback on new products and long term brand strategy. We continue to expect to reach a conclusion from this review by the end of 2025.

Could you kind of drill down on what sort of throw back.

Was it the higher promotions and the need for spending behind.

Looking ahead, our full year organic growth outlook is 1% the midpoint of our prior range. We expect full year adjusted EPS growth through 2025, lb, 349% or 2% higher than our previous outlook due to higher sales and improved margins.

Some of your brands and if so can we expect that to continue in Q4 and possibly next year.

Yeah. Thanks Bonnie.

You know, and you know, we obviously have an opportunity to um, to do m&a. I mean and and you know, we've uh we just gone through uh you know, a review. We just we just recently saw our our shares, our our treasury, our balance sheet, get upgraded as well. So I mean, I just think on many fronts, we got a, a quality balance sheet. Um, strong cash flow gives us a lot of optionality. So, you know, frankly with the potential

Kind of characterize it is really when we talk about our promotions, we talk about laundry and litter I already went through the laundry category litter.

To do to do both things. So,

Great. Thank you.

Including higher marketing spend.

There is a little unique right now as well like the category over a long period of time has jumped around between 16 and 18%.

As in past years, when we have stronger than expected business performance, we invest for the future. So we now expect marketing as a percentage of sale of sales to exceed 11% and these investments will continue our momentum into 2026.

Your next question comes from the line of Bonnie Herzog with Goldman Sachs.

Hold on deal that hit it where we think is almost an all time high at 24% one competitor significantly.

I'll close by saying that category consumption remained stable and our brands remain in a position of strength, we're getting dollar and volume share across key segments of the portfolio supported by a balanced mix of value and premium offerings were well positioned to navigate the current environment. The strategic actions. We are executing will set us up for sustained success are go.

Discounted their lightweight litter business and that's driving.

A couple of thousand points of.

Please, go ahead. All right, thank you. Good morning everyone. I um, I had a question on the promotional environment. Hoping just for some more color on that and then, you know, your volume growth was quite strong in the quarter, but, you know, price mix was slightly negative. So I guess just

Promotion.

Yeah.

We actually.

We're pretty much consistent year over year were up slightly 60 basis points.

And still managed to grow 5%, which was which was fantastic. So our brand our arm <unk> Hammer brand and kind of what I said in my comments, we think the advertising the halo effect.

Ford portfolio has never been stronger.

The seeking value is leading to arm <unk> hammer to an incredibly well.

This environment and for the future.

Then you look at negative price mix now part of that is some of our other businesses right we're doing.

Yeah, thanks Bonnie. Um, I would kind of characterize it as really. When we talk about our promotions, we talk about laundry and litter. I already went through the laundry category litter. Uh, litter is a little unique right now as well. Like, the category over a long period of time is bumped around between 16 and 18%.

Whether it's a rollback or price adjustments on batiste as we fix value for the consumer or vitamin business to make sure that we have the right velocities so not as much.

Thank you Rick and good day to everyone on this Halloween Friday, our church and Dwight team members across the globe delivered a quarter to be proud of highlights once against the many strengths of our portfolio and our team's capabilities.

Sold on deal. It hit it. What we think is almost an all-time high at 24% 1 competitor significantly.

In the laundry and litter business.

Um, discounted their lightweight loader business, and that's driving, uh, you know, a couple thousand points of promotion. Um,

Jump into third quarter, and our outlook, we'll start with EPS third quarter adjusted EPS was <unk> 81.

Alright, thanks for that and if I just wanted to ask a quick follow up question on pipeline could you give us a sense of maybe how that Brian has been performing.

Up two 5% from the prior year 81 cents was better than our 72 sitting outlook driven by higher volume and gross margin results favorable to our outlook.

The different channels.

Certainly thats the flora and then maybe talk a little bit more about your strategy to expand the brand in additional channels and I don't know, possibly other specialty retail channels.

Reported revenue was up 5% and organic sales were up three 4% the.

Organic sales was broad based across the globe with volume growth of 4%, partially offset by negative pricing and mix of <unk>, 6%.

Has that evolved.

We actually um were pretty much consistent year-over-year. We were up slightly 60 basis points uh and still managed to grow 5%, which was, which was fantastic. So our brand, our Arm and Hammer brand, kind of what I said in my comments, we think the advertising and the halo effect affect the, the seeking value is leading to Arm and Hammer to an incredibly well, uh, in this environment. And, and for the future,

This action is close thanks.

Yeah sure thing touched loans again doing fantastically well that business.

And beyond organic results, we were delighted with the encouraging startup touchwood are sales exceeded our initial projections.

Um, then you look at negative price mix, you know, part of that is some of our other businesses, right? We're doing

Yeah.

It is really at three retailers right, Sephora, Ulta, and Amazon make up about 90% plus of that.

Our third quarter adjusted gross margin was 45, 1%, a 10 basis point increase from a year ago, and 110 basis points better than our outlook. Our results versus last year was driven by a 170 basis points from productivity programs 20 basis points from higher margin acquisitions 10 basis points from FX and 10 basis.

That business.

And.

Uh whether it's a roll back uh or a price adjustments on Batiste as we fix value for the consumer uh or vitamin business to make sure that we have the right uh velocities. So not as much um in the laundry and litter business.

We don't really have much plans in the short or medium term to change that strategy. We believe that there is prestige and being in that category. There's examples of brands that have been able to grow by one hundreds of millions of dollars in that channel and expand to slightly adjacent categories over time, we think that's a.

Points from a combination of volume price and mix. These factors offset 200 basis points of inflation and tariff costs.

Moving to marketing or marketing expense as a percentage of sales was 12, 8% or 50 basis points higher than the third quarter of last year.

Good.

Model, there will be some niche plays at other retailers.

And for the year, we are now targeting to exceed 11% of net sales as we leverage our improved sales growth to invest for the future.

All right, thanks for that and if I may, I just wanted to, you know, ask a quick, follow-up question on touchline. Could you give us a sense of, you know, maybe how the brand has been performing in the different channels, you know, DTC and then certainly at Sephora and then maybe talk a little bit more about your strategy to expand the brand and additional channels. And I don't know possibly other special retail channels. You know, maybe how has that evolved since since the transaction is closed. Thanks.

I'm not ready to go through that yet and maybe that's a good question for January.

Internationally, we're really excited about growth behind <unk>, we believe that it can.

Yep, sure thing. Tesla's again doing fantastically well, that business.

Q3, adjusted SG&A increased 20 basis points year over year adjusted other expense increased by $3 9 million due to the lower interest income compared to last year and.

We're already seeing how fastest growing in Canada as an example of just one retailer so we're going to probably.

And we continue to expect other expense for the full year to be approximately $65 million on an adjusted basis, reflecting the lower interest income following the touch on acquisition.

You know, it's really at three retailers, right? So for Ulta and Amazon, they make up about 90% plus of that business and.

um,

Duplicate that approach across many more countries and make sure we hit the the right.

The right channel the right partner.

In <unk>, our adjusted tax rate was 21, 6% compared to $23. Three in Q3 of 24 170 basis point year over year decrease in the expected adjusted effective tax rate for the year is now 22, 5%.

And to make sure that we keep that kind of cachet of the brands.

Okay. Thank you.

Your next question comes from the line of Peter Grom with UBS. Please go ahead.

And now to cash we delivered strong cash results in the quarter as cash flow from operations increased 19, 6% versus last year to $435 5 million.

Any better now Oh, Hey benefit theater.

Alright, let's run this back a little bit.

I guess.

we don't really have much plans in the shorter medium term to change that strategy. We believe that there's prestige in, in being in that category, there's examples of brands that have been able to grow by hundreds of millions of dollars in that channel and expand uh to slightly adjacent categories over time. We think that's a good uh model. There will be some Niche plays and other retailers. Uh we're not ready to go through that yet. Maybe that's a good question for January.

Wanted to ask two questions from me. So first just on the implied step down in <unk> and I appreciate the commentary.

Capital expenditures for the first nine months were $67 2 million a $58 million decrease from the prior year due to return to normalized capital spending in 2025.

Um, internationally, we're really excited about growth behind Touchland. We believe that it can.

The port strikes and weaker Vms, but I would imagine some of that with some contemplated as youre thinking about the back half of the year, which you mentioned is unchanged. After a strong Q Q. So can you maybe just speak to why it's stepped down and will come in below the 2% category growth you mentioned, yes.

Finally in the third quarter, the company repurchased an additional $300 million of shares which brings our year to date share repurchases up to 600 million for our shareholders certainly a third quarter full of accomplishments let's.

Uh, we're already seeing how how fast it's growing in Canada, as as an example of just 1 retailer. So we're going to probably uh duplicate that approach across many more countries and make sure we hit the the right.

Yes, I'll give you a couple of comments and then maybe Lee has something to add as well I think the port strike is a reality right. There was one week that was the categories were up 11%. So when you do that math all of a sudden.

Uh the right channel, the right partner. Uh and to make sure that we keep that kind of cache of the brand.

Let's now turn to our outlook broadly, we continue to navigate well in an environment of economic uncertainty.

Okay, thank you.

And as a result have improved our outlook in several areas.

For the year, we now expect reported sales growth of approximately one 5% versus the prior year mid point view of one point out as we expect touch on this momentum to continue in the fourth quarter we.

Your next question comes from the line of Peter grow with EBS. Please go ahead.

October October will be negative as an example for categories and for and for the brands.

Any better now. Oh, perfect. Peter

So Fortunately vitamins Q4 is a larger business seasonality for vitamins, so as consumptions going backwards, there, even though we have some green shoots.

All right, let's run this back a little bit. Um, so I guess.

We also remain on track to deliver 2025 organic growth of approximately 1% the midpoint of our previous outlook.

I wanted to ask two questions. So first, just on the implied step down in Q4, and I appreciate the commentary.

It's a little bit more of an impact.

And then and then finally I think we were probably a little conservative on our on our Q3 outlook and we're very confident in the two 5% for the back.

We're very confident and over time, we're going to grow faster than categories.

And as I noted earlier, the combination of a stronger sales and gross margin outlook allows us to increase our marketing investments beyond our prior outlook in 2025 for.

Around the port strikes and and weaker VMS. But, you know, I would imagine some of that was some with contemplated as you were thinking about the back half of the year, which you mentioned is unchanged after a strong 2q. So, can you maybe just speak to why it steps down and would come in below the 2% category growth. You mentioned

But we feel like Q4, and Q3 and Q4 together is a good number yeah.

For the year, we now expect an adjusted EPS of $3 49.

And again I think just to Rick's point, we go back to what we said in on August 1st.

Which exceeds the midpoint of our prior outlook and.

Great comfort in that two 5% organic outlook, that's what we're still seeing today. Despite the macro doing what it's doing that seeks to the categories. How we're performing there's always pluses and minuses, but we're still sitting at that two 5% organic and if you do think about <unk>.

And specifically for <unk>, we now expect reported sales growth of approximately three 5% and an organic sales growth of approximately one 5%.

Yeah, I'll give you a couple comments and then maybe Lee has something to add as well. I think the the Port strike is is a reality right there was 1 week. That was the categories were up 11%. So when you do that math, all of a sudden, um, you know, October October will be negative as an example for categories, and for, and for the brands, um,

In <unk> I note that our reported sales our outlook includes a larger decline in sales from our discontinued businesses as these product lines run out of inventory and for some context, we expect $30 million of lower sales or 200 basis points of drag in the fourth quarter versus last year.

Just on a total sales perspective.

So, so poor strike vitamins, you know, Q4 is a larger, uh, business seasonality for vitamins. So, as consumptions, um, going backwards there, even though we have some green shoots, that's just a little bit more of an impact.

In my prepared remarks, we are running out these discontinued businesses, we're getting to the point now where that will be a bigger pressure point in the fourth quarter. So I noted that that was kind of the $30 million or 200 basis points of drag.

Um,

This is.

I'd also note an organic growth of <unk> was impacted by the prior year port strike and the negative consumption trends in our BMS business in.

And then I think Rick covered very elegantly the organic piece you adjust for that we're right on right on track and certainly gives us confidence for.

And then and then finally I think we were probably a little conservative on our on our Q3 Outlook and we were very confident in the 2 and a half percent for the back. Um, we're very confident that over time we're going to grow faster than categories, uh but

<unk>, our adjusted gross margin will contract approximately 50 basis points, primarily from inflation and tariff costs marketing will be lower compared to last year.

We feel like Q3 and Q4 together are a good number. Yeah.

For the fourth quarter, but certainly as we look beyond that as well.

That is it.

When you bring it all together, we expect an adjusted EPS <unk> 83 per share, which is an increase of 8% versus last year's adjusted EPS.

It's partially the port strike. So we don't feel like that's a kind of roll forward as you look into 2026.

Okay. That's super helpful. And then Rick you've had some good perspectives on.

Category growth for some time here.

I wanted to get your views on kind of how you see category growth in your portfolio are performing as we look out over the next 12 months or so and then just maybe specifically on the top line and I guess Morgan official guidance in January but do you need category growth to accelerate from 2% in order to hit your evergreen target.

As our teams look forward, we are optimistic our teams across the globe have delivered significant accomplishments. We continue to fuel share gains we've made strategic choices to exit brands in our portfolio. We've acquired touchless, which is off to a great start and we've returned $600 million to our shareholders through share repurchases.

Okay.

Yeah. So look I think for a long time, we've been very clear on how categories are doing and how our brands are doing in categories.

A big thank you to our employees across the globe for leaning forward and executing through the first three quarters of the year very well done.

All I guess first we comfort in the 2 and a half percent organic Outlook. That's what we're still saying today, despite, you know, the macro doing what it's doing, that speaks to the categories. How we're performing, there's always pluses minuses but we're still sitting at that 2 and a half percent organic and you know, if you do think about 32 to 4 q you know you know these you know just on the total sales perspective, I I mentioned it in my prepared remarks. You know, we are running out these discontinued businesses, you know, we're getting the point now where that will be a bigger pressure point in the fourth quarter. So I noted that that was kind of the $30 million or 200 basis points of drag. Um, and then, you know, I think recovered very elegantly, the, the organic piece. You adjust for that? Where we're, we're right in right on track and certainly uh, gives us as confidence, um, for the fourth quarter. But certainly, as we look beyond that as well. Yeah. And, you know,

We heard some of the competition say one five to two for US it's around 2% and that's because in my mind, we've been very picky about what categories. We go into our categories are doing a little bit better than most which is great.

That is, you know, it's partially the port strike. So we don't feel like that's a kind of road forward as you look into 2026 as well.

Eric let's move to Q&A.

Okay.

We will now begin the question and answer session. So I'd like to ask a question. During this time simply press star followed by the number one on your telephone keypad.

Okay, that's super helpful. And then, Rick, you've had some good perspectives on...

Long term track record over many many years is around 3%.

And we hope to get back there for our categories for sure at some point in time. Meanwhile, we're kind of planning that it's going to be around 2% and so as you saw this quarter.

Our first question comes from the line of Chris Terry with Wells Fargo Securities. Please go ahead.

Hi, Good morning, everyone. Good morning, Chris.

Despite.

2%, we grew faster than that and it's it.

So touch land is coming through better than expected.

Because all the great work, we're doing on an innovation on marketing on driving.

Category growth, for some time here. So I, I wanted to get your views and kind of how you see category growth and your portfolio performing as we look out over the next 12 months or so. And then just maybe specifically on on the top line and I get we'll get official guidance in January. But do you need category growth to accelerate from 2% in order to hit your Evergreen Target.

Which is great to see.

Driving share gains so.

Can you talk about how you might view the benefits.

I'm not going to talk about 2026, I'll do that in January but I would just say.

Touch land going into 2026.

<unk> been growing faster than category growth.

And specifically how might the positive contribution from touch Latin help offset any of the potential profit outcome you could envision from actions you may take on the vitamin business and I have a follow up.

Awesome. Thanks, so much I'll pass it on.

Your next question comes from the line of Andrea Teixeira with.

J P Morgan.

Please go ahead.

Thank you I was just hoping if you can.

Yes, I mean, we're going to.

I guess the first thing is you're right touchline is doing fantastic, even better than we expected better than our double digit comment last quarter consumption.

Kind of decompose a bit of the price mix and then you mentioned you have.

Yeah, so look I think for a long time we've been very clear on how categories are doing and how our brands are doing and categories. Uh I know we heard some of the competition say 1 and a half to 2 for us it's around 2%. And that's that's because in my mind we've been very picky about what categories we go into our categories are doing a little bit better than most which is great. I know, long-term track record over many, many years is around 3% and uh we hope to get back there for categories for sure at some point in time. Meanwhile, we're we're kind of planning that it's going to going to be around 2% and

and so, as

Obviously a good.

Consumption strong units per store per week of really strong innovation as strong collaborations are strong.

You order.

A good position in the value segment with thinking as the consumer continues to see particularly allowance.

Uh huh.

That's another segment.

I'm not going to really talk too much about 2026 at this point I would just say 25 is doing better than we expect it means there's going to be a stronger baseline and as we grow that of course will help offset anything from the discontinued businesses or potentially anything with vitamins as well.

Think about the mix effect and then.

Just as a clarification on FX going forward.

Uh, 2%, we grew faster than that, and it's, um, it's because of all the great work we're doing on innovation, on marketing, on, uh, on driving share gains. So,

This is something that is benefiting some of the companies like thats moving in that direction, how to think about international finally, getting those those state wins as you go into 2026.

I'm not going to talk about 2026, I'll do that in January, but I would just say, you know, we've been growing faster than category growth.

And Chris the only I would know just do keep in mind, we had a good amount of cash on our on our books we are earning.

Awesome. Thanks so much. I'll pass it on.

Interest on and obviously that will be a little bit of a headwind versus touch late next year as well.

Yeah sure I'll take the price mix and then then Lee can take the currency question.

Your next question comes from the line of Andrea Tara with JP Morgan.

Please go ahead.

I think it was to Bonnie we do have a negative drag on price mix from.

Okay.

The follow up is just on the competitive environment.

Our pricing and promotional actions on vitamins, we have a negative drag as we're fixing some value equations on batiste or our share gaps are closing, we're making improvements which is great. What is value. It's also it's innovation. It's the cross section of innovation and in price and so we're making adjustments as needed.

Looking up a bit.

I think you mentioned that your laundry promotional activity was actually down a bit relative to last year, just want to confirm that and in general how would you view.

Thank you. Um, I was just hoping, Rick, if you can, um, kind of decompose a bit of the price mix. And then you mentioned, uh, you have, um, you know, obviously a good um.

A good position in the value segment, but thinking as the consumer continues to seek particularly longer, uh, that value segment, um, how to think about the mix effects. And then, um,

The competitive backdrop right now.

For Batiste and then it's also the consumer is value seeking behavior and that means larger sizes and when you have larger sizes. That's also typically a little bit of a drag on price mix, whether that's in laundry or litter. So those kind of three things really.

And your potential need to respond to any activity that youre seeing and maybe just a level of confidence that the really strong.

Volume share performance that you've been delivering is.

Sustainable and what might be needed to sustain that level of execution. Obviously you have.

Impact the price mix line.

Just as a clarification on the effects going forward, I mean, this is something that is benefiting, you know, some of the companies like that. Um, moving in the other direction, how to think about International finally getting those? Those stay wins as you go into 2026, I think. Yeah, sure. I'll take uh, the price mix and then then lie can take.

And I'll go from there.

You kind of teased innovation plans for next year, but also just the potential level of brand support. Thanks, so much.

And to Rick's point also I mean, it's a pretty nominal amount for us I mean, I think the big call. It in our organic is also just as continued momentum with volume growth really driving the piece there.

Thanks, Chris.

For laundry.

Prepared comments I said, it and I think it's such a impactful statement.

On FX Andrea in terms of international I mean, I would say this.

For the first time in eight quarters, the value tier of laundry grew and that was.

The international team is doing a really nice job of growing.

They are very much focused on margins. So yeah, FX can be a pressure point.

Look year over year, an amount sold on deal, which again remember that depth and frequency.

Tariffs inflation fee and then we combat it we can about it with our with productivity with good with our GM practices. So, yes, FX turns out to be a little bit of favorable that could be helpful.

So that is where we were down 400 basis points year over year.

Our competition was up between 300 600 basis points, depending on what brand.

But I said I think it was tabani and we do have a negative drag on price mix from you know, our our pricing and promotional actions on on vitamins. We have a negative drag as we're fixing some value equations on batist you know or our share gaps. Uh are closing, we're making improvements, which is great. What is what is value? It's it's also its Innovation, it's the cross-section of innovation and, and price and so we're making adjustments as needed, uh, for Batiste. And then it's also the consumer is value seeking behavior and that means larger sizes. And when you have larger sizes, uh, that's also typically a little bit of a drag on price.

But you look at that business, they've been growing and they've been doing a good job of also bringing gross margin forward as well so if.

So I.

I believe that is a trend that's starting to happen in the category as consumers are pressed.

Is mixed uh whether that's in laundry or litter. So those kind of 3 things really um impact the price makes life.

We're kind of slowly move into value, which is great.

If that happens, we'll take that as a positive.

Yeah.

And if I can this is super helpful. If I can just go.

That is.

That is one piece of it.

Go back two weeks comment on and thank you Lee on the FX, but the comment on the pricing and promo back when your same promo has been technically benign for you and you're gaining share in particularly allowed to continue to gain share and your competitor has been increasing more promo I understand.

Another indication is even the pod category, which is around 23% of the category. It's the most expensive form of laundry detergent rate two times liquid that's been flat the category for the last six quarters. So those are just indications.

And I I'll go from there. I mean, you know, and to Rick's point also I mean it's it's a pretty nominal amount for us. I mean I think the the big call in our organic is also just this continued momentum with volume growth, really driving the piece there. Hey uh on FX on you, in terms of international. I mean I I'd say this um, you know International Teams doing a really nice job of growing.

The value.

Value matters. So if promotional intensity does pick up I think overall, we're in a great spot value is doing well and even some of our higher price competitors. There twice the cost of our laundry detergent. So they would have to do massive discounts to to move any elasticity. So again.

And I think also are kind of going.

<unk> value proposition are you seeing any pressure on that most recent loans and liquid.

As you exited the quarter.

I wouldn't I wouldn't change any of my comments I'd say in general the value tier continues to do really well like that's almost like a macro trend more southern what any one competitor is or could do.

We are well positioned I think this is starting to be a little bit of a trend.

Out to be a little bit of a favorable that that could be helpful. Um but you you look at that business they've been growing and they've been doing a good job of also um you know bringing gross margin for it as well. So if that happens we'll we'll take that as a positive.

In the category for consumers seeking value.

And so that's why I believe that despite us going lower and promotions.

Okay.

Your next question comes from the line of Peter.

Peter Grom with UBS.

To have the value piece of the category expand its just a really good indication of that and so that's.

Please go ahead.

Okay.

Hey, Peter you're breaking up a little bit.

That's the trend we're seeing.

Expect it to continue.

Yeah.

Okay.

Okay, great. Thank you Rick Thank you Lee.

Not really.

Yeah.

Okay.

Your next question comes from the line of Steve powers with Deutsche Bank.

Are you trying to reconnect and we'll make sure you get back and so.

Please go ahead.

And if I can uh, this is super helpful, I can just um go back to week's comment on and thank you Leon on the effects but the Rick's comment on the pricing and and promo back when you saying promo has been technically, benign for you and your game share in uh in particularly lounge or continue to gain share. And your competitor has been increasing more promo. I understand that they also are kind of going um into a more value proposition. Are you seeing any pressure on that most recent launch in liquid?

Yes.

Great. Thank you.

Okay.

As they acted the quarter.

Two questions I guess as I look at my Macy's kind of three so bear with me.

Your next question comes from the line of.

We will pass Perique with Oppenheimer.

First of all laundry not to beat a dead horse, but.

Please go ahead.

Morning, and thanks for taking my question. So I guess just go into international another strong quarter, even on a difficult comparison. So just curious are you are you guys seeing any changes there macro consumer wise and how do you feel about sustaining momentum in the international segment for the balance of the year.

Can you just help us.

It will help me square the circle, a little bit more there is definitely a narrowed about their day church and Dwight being more promotional through the third quarter, we've certainly seen price mix.

Uh, I wouldn't, I wouldn't change any of my comments, I'd say in in general, but the value to your continues to, to do really well. Like that's almost like a macro Trend, uh, more so than what anyone competitor is or could do, uh,

Yes, yes.

As I said I was just in Argentina, a couple of weeks ago with 300, plus people and there's a ton of excitement about our brands and the growth profile of some of our even though our new brands like their breath and hero and touch line, so even as the macro.

Negative slightly negative in the quarter so yes.

What explains that is it mix within your portfolio, where you have been directing the promotion just any more color there.

And so that's why I believe that despite us going lower in promotions uh to have the value piece of the category. Expand is just a really good indication of that and so that's the that's the trend we're seeing. I I expect to take to continue.

Yes.

And how that's likely to trend going forward number one and then in vitamins you mentioned some green shoots could you just elaborate a bit more on what those are and then just update us.

Okay, great. Thank you Rick. Thank you Lee. Yeah.

GDP starts to slow and some of these countries. The tailwind of these brands, which bring problems solution brands innovation new categories, a lot of excitement to continue to deliver against our really our evergreen model for international So a lot of momentum in our international business.

Your next question comes from the line of Steve Powers with glutch bank.

Please go ahead.

If you think you'll have a kind of a more comprehensive outlook and business strategy around that segment come January thank you.

Sure Yeah. The first one premise mix negative on laundry there is no better metric to look at the amount sold on deal. That's what we've been using for for many many years and the reason we say that is that is the intersection again on on depth and frequency like it's really.

Great and then maybe just one quick follow about share buybacks again.

Significant buybacks.

You saw your stock would obviously pull backs, which does anything change in terms of your priorities share buybacks versus M&A or should we just expect you to continue to be opportunistic based on where your stock does.

Shows what's going on in market. So.

All I can do is point you to the actual numbers that come out of whether you have Nielsen there second a and we are down year over year and promotion. Our competition is up anywhere between 306 hundred basis points. When there is negative price mix in laundry that can be a whole host of things that could also be.

Yeah. So good question so to your point, yes.

We definitely took advantage of.

The value opportunity there.

We typically try to just you know.

You know our part is at parties or if we wanted to we want to focus on M&A.

Number one focus of our cash.

Again, as I said before as consumers trade up to larger sizes that mix impact can be.

And where we're at in the market accordingly, but if any opportunities come up to maybe accelerate a little bit of our share.

A negative in that line, so thats kind of what I would I would I would say consistently number two.

Share buybacks you know, we'll do that as we sit here today.

Great. Thank you. Um 2 questions which I guess as I look at my notes is kind of 3 so bear with me. Um Rick on the first 1 laundry not to beat a dead horse but just can you just help us Square? The help me Square the circle just a little bit more. There's definitely a narrative out there that church and Dwight's been more promotional through the third quarter. We've certainly seen price mix um you know, dip negative, you know kind of accelerate negatives in the quarter. So just you know is it what explains that is it mixed within your portfolio? It's where you've been directing the promotion just any more color there and and and and um you know how that's likely to Trend going forward number 1. And then on vitamins you you mentioned some green shoots. Could you just elaborate a bit more on what those are? And then just update us, um, if you think you'll have a kind of a more comprehensive Outlook and business strategy around that segment. Uh come January, thank you. Sure. Yeah, the first 1, uh, price Miss mixed negative on laundry. You know, there there is no better.

We've done everything we've done with the $600 million, we bought touch lens.

On vitamins the Green shoots are two examples I think.

You know, we've got great cash flow balance sheet is in a good place as we look forward we'll.

One would be.

Refresh we're still focused on an M&A theres still opportunities out there and.

Hard to say, but sometimes when you have consumption go backwards at a retailer in 2025% you think the world is ending but now some of that is discontinuation that have happened. So we have to lap some of that but when you go look at the core skus.

<unk>.

And we obviously have an opportunity to do M&A and we've we've just gone through a.

Our review, we just you just recently saw our share as our treasurer, our balance sheet get upgraded as well. So I mean I just think on many fronts. We got a quality balance sheet strong cash flow gives us a lot of optionality, so frankly with the potential to do that but to do both things.

The ones that are remaining.

They are declining at a much lower rate.

Which is always encouraging.

The second one probably is.

Metric to look at then, amount sold on Deal. Uh, that's what we've been using for for many, many years. And and the reason we say that is that is the intersection again on on depth and frequency, like it's really, uh, shows what's going on in market. So all I can do is point you to the actual numbers that come out of whether you have Nielson or Sakana and we are down year-over-year and promotion. Our competition is up anywhere between 300 and 600 basis points, when there's negative price, mix and laundry, that can be a whole host of things. It could also be, um,

A couple of food retailers are actually doing really well and we've heard distribution gains there as well. So those are a couple of green shoots on the strategy. It was the right thing to do to publicly announced this about a quarter ago, we've had even more interest externally as we look at different options and then Meanwhile.

Great. Thank you.

Okay.

Your next question comes from the line of Bonnie Herzog with Goldman Sachs.

Again, as I said before, as consumers trade up to larger sizes, uh, that mix impact can be uh, a negative in that line. So that's kind of what I would I would be I would say consistently number 2.

Please go ahead alright.

Thank you good morning, everyone.

I had a question on the promotional environment, hoping just for some more color on that and then your volume growth.

Internally, we're focused on how we.

Kind of a plan b on our cost structure and rightsize that business. So I would say by the end of the year consistently again that we'll have more to say and I'm optimistic.

Quite strong in the quarter, but price mix was slightly negative. So I guess, just could you kind of drill down on what sort of throw back was at the higher promotions and the need for spending behind.

Okay. Thank you on all that I appreciate it.

Some of your brands and if so should we expect that to continue in Q4 and possibly next year.

Your next question comes from the line.

Legal.

Bank of America.

Yes, Thanks, Tony.

On vitamins the green shoots, uh, 2 examples. I think, uh, 1 would be, you know, it's kind of hard to see. But sometimes when you have consumption go backwards at a retailer in 2025 percent, you think the world is ending. But, you know, some of that is discontinuation that have happened and so we have to lap some of that. But when you go look at the core skus, uh, the ones that are remaining, you know, they're, they're declining at a much lower rate, uh, which is, is always, uh, encouraging. Um, the second 1 probably is

Please go ahead.

Would kind of characterize it is really when we talk about our promotions, we talk about laundry and litter I already went through the laundry category litter.

Hi, good morning. Thank you so much for the question.

I have two parts to that question.

Literally unique right now as well if the category over a long period of time has bumped around between 16 and 18% sold on deal that hit what we think is almost an all time high at 24% one competitor significantly.

First I wanted to ask on retailer President and pack size, we're continuing to hear from peers in your space about the movement of sales to club and online which have been better growth versus food drug and mass. So I was curious if you could talk about this dynamic within your categories.

Discounted their lightweight litter business and that's driving.

Then secondly on the M&A Bryan, while you're still digesting touch lend it has performed better than expected and it's an interesting acquisition given clenched lender than some of the specialty beauty stores like Sephora, you've done well in acquisitions. The last few years in personal care and I'm sure you'd like to get back to a more regular cadence.

A couple of thousand points of.

Promotion.

Hmm.

We actually.

Uh, a couple food retailers are actually doing really well and we've heard distribution uh gains there as well. So those are a couple green shoots on the strategy. It was the right thing to do to to publicly announce this about a quarter ago, we've had even more interest uh externally as we look at different options. Uh and then meanwhile internally we're focused on how we um, kind of have a plan B on on our cost structure and and right-size that business. So I would say by the end of the year consistently uh again that we'll have uh, more to say and I'm optimistic.

We're pretty much consistent year over year were up slightly 60 basis points.

Okay, thank you on all that. I appreciate it.

And still managed to grow 5%, which was which was fantastic. So our brand our arm <unk> Hammer brand and kind of what I said in my comments, we think the advertising and the Halo effect.

Your next question comes from the line of Anna lizzle with Bank of America.

Please go ahead.

One tuck in acquisition annually. So I was wondering if we should expect to continue to focus on personal care or maybe if you'd be willing to explore more in the adjacent Judy. Thanks.

<unk> that the seeking value is leading to arm <unk> hammer doing incredibly well.

Hi, good morning. Thank you so much for the question.

This environment and for the future.

Yes, good questions I think actually very similar questions to again when I was in Argentina that are distributors were asking I would say, we're again very encouraged with touch lend and youre right a little bit more of a niche in terms of distribution and kind of go to market.

Then you look at negative price mix now part of that is some of our other businesses right we're doing.

Whether it's a rollback or price adjustments on batiste as we fix value for the consumer or vitamin business to make sure that we have the right velocities so not as much.

I have two parts to a question. Um, first I wanted to ask about retailer presence and pack size. We're continuing to hear from peers in your space about the movement of sales to club and online, which have seen better growth versus food, drug, and mass. So, I was curious if you could talk about this dynamic within your categories.

From an M&A perspective, we're typically typically agnostic on what category as we go into it could be household could be personal care has to be more like functional beauty. We are not a beauty company. We can't perform we don't we don't have to.

In the laundry and litter business.

Alright, thanks for that and if I just wanted to ask a quick follow up question on pipeline could you give us just a little harder.

The brand has been performing well.

There's a lot of dead bodies on the road to trying to be a beauty company. We don't want to do that we want to be right in the middle where theres a personal care slash beauty component, we think theres a lot of goodness there problems.

Okay.

Thank you.

Certainly not before and then maybe talk a little bit more about your strategy to expand the brand in additional channels on I don't know, possibly other specialty retail channels label how has that.

Problem solution, yet a motive advertising and connection.

And then secondly, on the M&A front, you know, while you're still digesting Touchland, it has performed better than expected. It's an interesting acquisition given Touchland is in some of the specialty beauty stores like Sephora. You've done well on acquisitions the last two years in personal care, and I'm sure you'd like to get back to your more regular cadence of one tuck-in acquisition annually. So, I was wondering if we should expect to continue to focus on personal care or maybe if you'd be willing to explore more in the adjacent beauty space. Thanks.

All right.

The transaction is closed.

Yeah, and a good question.

So we are laser focused on that our new president Chuck.

Yeah sure thing Touchless, again doing fantastically well that business.

<unk> is laser focused on that as well.

Retailer pack size right not.

Yeah.

It is really at three retailers rates are for Ulta and Amazon makes it makes up about 90% plus.

Frighteningly different channels are performing at different levels right. The club class of trade is doing extremely well.

You know, actually very similar questions to again when I was in Argentina that are Distributors were asking. Uh I would say we're again, very encouraged with touchland and you're right, a little bit more of a niche in in terms of distribution and kind of go to markets.

That business.

And.

We continue to have offerings in club or a strategy internally is how do we make sure that that's always a proactive strategy and not a reactive strategy.

We don't really have much plans in the short or medium term to change that strategy. We believe that there's prestige and being in that category. There's examples of brands that have been able to grow by one hundreds of millions of dollars in that channel and expand to slightly adjacent.

They have to be on the forefront of of pack sizes and innovation.

But you also have to meet the consumer where they're at in different channels like the drug channel or the dollar channel and have the right pack sizes and right price point, so it's not <unk>.

Over time, we think that's a good.

From an m&a perspective, we're typically typically agnostic on what categories. We go into. It could be household, could be personal care has to be more like, functional Beauty, like we are not a beauty company. We, we can't perform. We don't, we don't have to, um, the the, there's a lot of dead bodies on the road to trying to be a beauty company. We we don't want to do that. We want to be right in the middle where there's a personal care slash Beauty uh component. We think there's a lot of of uh, of goodness there.

The model there will be some niche plays at other retailers.

Either or it's both and we have to be good at both and we've historically done that really well.

Not ready to go through that yet and maybe that's a good question for January.

Okay, great. Thanks, so much.

Problem solution yet a mode of advertising and connection. Uh, so we're laser focused on that. Our our, our new president Chuck. Um, his laser focused on that as well.

Internationally, we're really excited about growth behind <unk>, we believe that it can.

Your next question comes from the line.

Uh, retailer pack size.

Filippo <unk>.

<unk> with Citi.

We're already seeing how fastest growing in Canada.

Please go ahead.

Hi, good morning, everyone.

Example of just one retailer so we're gonna probably duplicate that approach across many more countries and make sure we hit the the rate.

Not surprisingly, different channels are performing at different levels. The club class of trade is doing extremely well.

Two questions from me one on the retailer inventory levels, obviously, you had some destocking.

First half of the year did you see any impact in Q3, and even assuming no impact in Q4, and then as you think about 'twenty six should we think about the first half of the year have been particularly easy comp and retailer inventory. So maybe faster growth in the first half I know you haven't given guidance, but just a high level how to think about it.

The right channel the right partner.

And to make sure that we keep that kind of cachet of the brand.

We we continue to to have offerings and Club you know our strategy internally is how do we make sure that that's always a proactive strategy and not a reactive strategy? Uh they have to be on the Forefront of of of pack sizes and and innovation

Okay. Thank you.

Your next question comes from the line of Peter Grom with UBS.

uh but you also have to meet the consumer where they're at and and different channels like uh

Go ahead.

Any better now.

It may benefit theater.

And then the second question on the on the margin can.

Alright, let's run this back a little bit.

At the drug Channel or the dollar Channel and have the right pack sizes and right price points. So it's not, um, either or it's both. And we have to be good at both and we've historically done that really well.

Can you review the drivers of the lower tariff guidance and maybe if you can give some color also on the broader commodity outlook. Thank you.

Yes.

I wanted to ask two questions from me so first.

Okay, great. Thanks so much.

The implied step down in <unk> and I appreciate the commentary.

Around the port strikes and weaker Vms, but I would imagine some of that was some contemplated as youre thinking about the back half of the year, which you mentioned is unchanged. After a strong Q2. So can you maybe just speak to why stepped down and will come in below the 2% category growth you mentioned.

Okay, let's try a couple of questions in there so.

Your next question comes from the line of philippo baloria with City.

Please go ahead.

The retailer inventory aside to your point beginning of the year, we had some some pressure points. There are about 300 basis points to first quarter, maybe 100 basis points of pressure in <unk>.

Not really seeing that we've seen kind of kind of stable levels here in the back half.

That's what we experienced in the third quarter and Thats, what were kind of expecting as we go forward here.

Yeah.

All I'll say balanced way, so we'll watch it closely.

October October will be negative as an example for categories and for and for the brands.

In terms of.

Moving on to <unk>.

Tariffs and commodities and things like that.

So of course right vitamins you know Q4 is a larger business seasonality for vitamins, so as consumptions going backwards, there, even though we have some green shoots that just a little bit more of an impact.

Let's go back we've made a lot of progress on tariffs. So if we go back to April you were looking at a bill it could've been as high as $190 million.

Hi, good morning everyone. Um, 2 questions, for me, 1 on uh, the retailer inventory levels. Uh, obviously you had some these stock in the first half of the year. Did you see any impact in Q3 any assuming no impact in Q4? And then, as you think about 26? Should we think about the first half of the Year? Having particularly easy components retailer inventory? So, maybe faster growth in the first half, I know. You haven't given guidance but just the high level how to think about it. And then the second question on the, on the margins, uh, can you review the, the drivers of the lower, tariff, guidance and and maybe if you can give some color also on the broader commodity Outlook, thank you.

We quickly rally the organization around that we made some some tough strategic decisions, but we've also really focused on what can we do about it and.

And then and then finally I think we were probably a little conservative on our on our Q3 outlook and we're very confident that two 5% for the back.

Additional productivity targeted pricing actions.

We're very confident that over time, we're going to grow faster than categories.

We've now moved that down.

But we.

We feel like Q4s in Q3 and Q4 together is a good number yeah.

All right. Okay, let's try that a couple questions in there. So um, on the retailer inventory side, it's to your point beginning of the year, we had some some pressure points there. Uh about 300 basis points in the first quarter, maybe 100 basis points of pressure in in 2q not not really seeing that. We're seeing kind of kind of stable levels here in the uh the back half.

Two what essentially is a $25 million 12 month number.

And.

And again I think just to Rick's point, we go back to what we said in on August 1st.

We released back on August one that number was about 60, it's moved really threefold. This move because we've we've driven more actions around the globe.

Great comfort in that two 5% organic outlook, that's what we're still seeing today. Despite the macro doing what it's doing that speaks to the categories. How we're performing there's always pluses and minuses, but we're still sitting at that two 5% organic and if you do think about <unk>.

Uh, that's what we experienced in the third quarter, and that's what we're, you know, kind of expecting as we go forward here. Um, you know, all I'll say is a balanced place; we'll watch it closely.

Whether it's negotiations movements I think in the supply chain side.

There's been there has been some targeted pricing and then frankly the rates changed but.

That puts us in a really good place.

Just on a total sales perspective I mentioned in my prepared remarks, we are running out these discontinued businesses, we're getting to the point now where that will be a bigger pressure point in the fourth quarter. So I noted that that was kind of the $30 million or 200 basis points of drag.

As we noted in our release.

As you kind of look forward to 2026, we should be able to just have it environment of I'll say normal.

Commodity inflation and tariffs should not be a drag it could actually turn out to be an opportunity.

Um, in terms of, um, moving on to, um, tariffs and commodities and things like that, you know, let's just go back. We've made a lot of progress on tariffs. So if we go back to April, we're looking at a bill; you know, it could have been as high as $190 million. Um, we quickly rallied the organization around that. We made some tough strategic decisions, but we've also really, you know, focused on, you know, what can we do about it, and, you know,

And then I think Rick covered it very eloquently the organic piece you adjust for that where we are right on right on track and certainly gives us confidence.

Additional productivity. The targeted pricing actions.

Commodities are still been sticky you sit here today with what our commodity view was for the year, it's still still slightly up from what it was in the beginning of year I think as we look forward.

For the fourth quarter, but certainly as we look beyond that as well.

That is it.

It's partially the port strike. So we don't feel like that's a kind of roll forward as you look into 2026 call.

We are expecting more of the same but we'll leave the rest of the 26 commentary until later.

Great Super helpful I'll pass it on.

Okay. That's super helpful. And then you've had some good perspectives on category growth for some time here.

Your next question comes from the line of Olivia Tong with Raymond James.

I wanted to get your views on kind of how you see category growth in your portfolio are performing as we look out over the next 12 months or so and then just maybe specifically on the topline I guess Morgan official guidance in January but do you see category growth to accelerate from 2% in order to hit your evergreen target.

Please go ahead.

Great. Thanks, first just a clarification.

Assume there wasn't any pull forward from Q3 to Q4 or any other change in timing that helped contribute to the top line upside this quarter.

Even more actions around the globe. Um, in terms of you know whether it's negotiations, movements, anything in the supply chain side, um, there's been a there has been some targeted pricing, and then frankly, the rates changed but um, you know, that, that puts us in a really good place. Um, as we know it in the release. Um, as we as we kind of look forward to 2026, you know, we should be able to just have an environment of, I'll say normal.

No.

Perfect.

They're easy.

And then just thinking about a different way in terms of laundry given the strength there and obviously your consumer desire for value. How do you think about the options that are in front of you clearly.

Hey.

Okay.

Yeah. So look I think for a long time, we've been very clear on how categories are doing and how our brands are doing in categories.

<unk>.

We heard some of the competition that they wanted to have the two for US it's around 2% and that's because in my mind, we've been very picky about what categories. As we go into our categories are doing a little bit better than most which is great and our long term track record over many many years is around 3% and we hope to get back there for our categories for sure at some point.

You've done very well in the category you have driven greater profitability in the category.

Uh, commodity inflation and you know tariffs should not be addressed, you know, it could actually turn out to be an opportunity. Um, you know, Commodities has still been sticky. Um, you we stay here today with what our commodity view was for the year, it's still still slightly up from what it was in the beginning of the year. Um, I think as we look forward, you know, we're kind of expecting more of the same but we'll, we'll leave the rest of the 26, commentary until later.

Is there as you think about the options in front of you is there a thought around potentially being.

All right. Super awesome. I'll pass it off.

More aggressive on price or things for those consumers who are struggling potentially.

Your next question comes from the line of Olivia Tong with Raymond James.

Please go ahead.

Potentially looking at it from a share perspective, and given the opportunity that you have in front of you and the fact that gross margins have actually shown some pretty nice upside.

In time. Meanwhile, we're kind of planning that it's going to be around 2% and so as you saw this quarter.

Despite.

Great thanks. Um first just a clarification um I assume there wasn't any pull forward from Q3 to Q4 or any other changing timing that helped uh, contribute to the Topline upside this quarter

Yes, I mean for laundry I think look the promotional level levels, plus or minus are going to be what they are and will always be competitive I think overall the medium to long term, we love, where we are in the and the intersection of value that's fantastic.

2%, we grew faster than that and it's.

No.

It's because of all the great work, we're doing on an innovation on marketing on driving share gains. So I'm not going to talk about 2026, I'll do that in January but I would just say.

We've been growing faster than category growth.

<unk> always the reason why we performed well over a long period of time right. We're at a 15 or so share. These days were in 30% of households.

Awesome. Thanks, so much I'll pass it on.

Your next question comes from the line of Andrea Teixeira with JP Morgan.

We lead in.

And wash loads there is a reason for that or right there at value and innovation, so our deep clean innovation.

Please go ahead.

Thank you I was just hoping if you can.

Kind of decompose a bit of the price mix and then you mentioned you have.

While our most expensive form of arm <unk> Hammer is til.

Obviously a good.

There's still a 70% the price of premium laundry detergent and so innovation matters.

A good position in the value segment. The thinking is as the consumer continues to see particularly in laundry.

Perfect. Um, very easy. Um, and then just, um, thinking about a different way in terms of laundry, um, given the strength there and obviously, the consumer desire for Value. How do you think about the options that are in front of you clearly? Um, you've, um, you've done very well in the category you've driven grit or profitability in the category. Um, is there, you know, as you think about the options in front of you? Is there a thought around potentially, being more aggressive on price, or things for those consumers who are struggling? Um, potentially looking at it from a shared perspective, uh, you know, given the, the opportunity that you have in front of you. And and the fact that, you know, of course, margins have actually um, shown some, some pretty nice upside.

We're going to have some more laundry innovation next year.

That value segment.

And so that's that's why over a long period of time, we've been able to.

Think about the mix effect and then.

Grow our business.

Just as a clarification on the FX going forward.

Great. Thank you.

Is this something that is benefiting some of the companies like thats moving in that direction, how to think about international finally, getting those those state wins as you go into 2026.

Your next question comes from the line of.

Escalante with Evercore ISI.

Please go ahead.

Hey, good morning, everyone.

At high level question for me why do you think.

We'll always be competitive. I think overall the, the medium to long term, we love where we are in the, in the intersection of value. That's fantastic. Innovation, is always the reason why we perform well over a long period of time, right? We're at a 15 or so share these days, we're in 30% of the households. Uh,

Yes, sure I'll take the price mix and then then Lee can take the currency question.

The brother personal care.

Sector is premium Miocene in an environment like this.

I think it was to Bonnie and we do have a negative drag on price mix from.

There are Red Hill continue doing great compounding there is no port strike impact for them why is that is this differ.

Our pricing and promotional actions on vitamins, we have a negative drag as we're fixing some value equations on batiste or our share gaps are closing, we're making improvements which is great. What is what is value. It's also it's innovation the cross section of innovation and in price and so we're making adjustments as needed.

We we lead uh in in wash loads like there's a reason for that. We're we're right there at Value and Innovation. So our deep clean Innovation uh while our most expensive form of arming Hammer is still um,

Differences in China are these different consumers sets.

Because there is legacy brands from which you can gain market share anything that you can tell us to explain what's happening.

Is still 70% the price of premium motor detergent and so Innovation matters. Uh, we're going to have some more laundry Innovation next year.

And so that's that's why over a long period of time. We've been able to, to grow our business,

What does it mean for your future growth into 2026. Thank you.

Great. Thank you.

It's a good question Javier it's never one thing it's always.

Your next question comes from the line of Javier Escalante with every core I.S.I.

It's a few different things in my opinion I believe it's these are great problem solution brands right their breath really works for bad breath.

Please go ahead. Hey, hey, good morning everyone. Uh,

Impact the price mix line.

High level question for me, why do you think that the broader personal care?

However, it's also appeals to the young.

And I'll go from there.

Sector is premium in an environment like this.

And Ah NL consumer great packaging great story.

Great social media presence.

On FX Andrea in terms of international I mean, I would say this.

Hero.

A problem solution really works.

The international team is doing a really nice job of growing.

The best performing Acme patch out there.

They vary they are very much focused on margin. So yeah, FX can be a pressure point.

And.

Touchline, it really works and at Premier premium advises a kind of a tired old category with.

Tariffs inflation.

And then we combat it we can about it with <unk>.

With productivity with good with.

There are breath here. Continue doing great compounding. There is no poor striking impact for them. Why is that is this differences in channel? Are these different consumer sets is because there is Legacy brands from which you can gain market, share anything that you can tell us to explain what's happening and what does it mean for your future growth into 2026? Thank you. Yeah, that's a good question Javier, you know, it's never 1 Thing.

With fragrance and set on the go convenience.

Our GM practices. So, yes, FX turns out to be a little bit of favorable that could be helpful. But you look at that business, they've been growing and they've been doing a good job of also bringing gross margin forward as well. So if that happens we'll take that as a positive.

So.

I would say there is a problem solution aspect to it.

Hey.

Theres, a great branding ex aspect to it.

Theirs.

Some of the competition in those categories isn't.

And if I can this is super helpful. If I can just go back two weeks comment on and thank you Leon on FX, but the mixed comment on the pricing and promo back when your same promo has been technically benign for you and you're gaining share in and particularly allowed to continue to gain share.

It's been around for a really long time isn't as new and fresh I would say so it's not just one thing.

All right, it's always it's the it's the it's a few different things in my opinion, I I believe it's these are great problem, solution Brands, right? Their breath really works for for bad breath. Uh, however, it's also appeals to the to the young and uh, and old consumer and a great packaging. Great story.

Um,

great social media presence.

Multiple things Thats why we believe at the end of the day.

There is a lot of opportunity.

And those three businesses right and I said in my prepared remarks household penetration for hero nine.

Uh, Hero, uh, it's a problem-solution brand. It really works. Uh, it's the best performing acne patch out there and um,

And your competitor has been increasing more promo I understand that they also are kind of going into a more value proposition are you seeing any pressure on that most recent loans and liquid.

Category <unk> 28 per thorough breath of 11 categories 65 <unk> seven.

Touchline, you know, it really works, and its premium rises. Uh, kind of a tired old category with, uh.

Category <unk> 42.

And that's why we keep getting TDP growth as well so again, it's a mix of all those things.

With fragrance and scent-on-the-go convenience.

so,

<unk> exited the quarter.

Thank you.

Your next question comes from the line of Lauren Lieberman with Barclays.

Uh, there's a great branding X aspect to it. Um, there's

Please go ahead.

some of the competition in those categories isn't, um,

Thanks, Good morning, guys.

Just one thing I want to talk about with couponing and just how much couponing is currently.

And so that's why I believe that despite.

Part of your strategy how much activity there has been because this is something that kind of shows up.

It's going lower and promotions.

To have the value piece of the category expand its just a really good indication of that and so.

Has been around for a really long time isn't as new and fresh, I would say. So it's not just 1 thing. It's a it's a it's a multiple things that's why we believe at the end of the day that there's a lot of opportunity.

Differently right at the end market you can't necessarily see it.

And the Nielsen data. So I was curious if you could talk about couponing.

That's the trend we're seeing I expect to continue.

In those three businesses, right? And I said in my prepared remarks, household penetration for Hero 9.

And then also just looking specifically at laundry and the data it does show price per Ecu <unk>.

To continue.

Okay, great. Thank you Rick Thank you Lee.

Yeah.

Is down low single digits, so even though.

Your next question comes from the line of Steve powers with Deutsche Bank.

You said the percentage that's on promotion is low.

Please go ahead.

The category 28 for a fair breath, 11 category, 65 teslin 7 category, 42. Uh and that's why we keep getting TDP growth as well. So again, it's a mix of all those things.

Great. Thank you.

Just curious broadly about about pricing in the market and if the depth is it worth talking about thanks.

Thank you.

Two questions I guess as I look at my Macy's kind of three so.

Good work on the first one laundry nothing beat a dead horse, but.

Yes, I'll take the second one first.

Your next question comes from the line of Lauren Lieberman with Berkeley.

Please go ahead.

<unk>.

When you look at EQ that really means wash loads and so as you have consumers trade up to larger sizes.

Can you just help us square that will help me square the circle, a little bit more there is definitely a narrowed about their day church and Dwight being more promotional through the third quarter, you certainly see price mix.

As you have channels.

Great, thanks. Good morning, guys. Um, just one thing I want to talk about was couponing and just how much couponing is currently.

<unk> club that are growing faster than that means the larger sizes or doing more sales, which then translates into a lower price per EQ and thats part of it.

Yes, yes.

Negative.

Negative in the quarter.

Thank you.

What explains that is it mix within your portfolio, where you have been directing the promotion just any more color there.

And then if you go to a few of the different retailers you see not just us but also others.

Hum.

How that's likely to trend going forward number one and then in vitamins you mentioned some green shoots could you just elaborate a bit more on what those are and then just update us.

Having some rollbacks at NASS, but in general I think the biggest thing is the trend on larger sizes, which is channel specific and part but also pretty broad based.

Part of your strategy is looking at how much activity there's been because this is something that kind of shows up, you know, differently, right? It's in the market; you can't necessarily see it in the Nielsen data. So I was curious if you could talk about couponing. Also, just looking specifically at laundry, the data does show that price for EQ is down low single digits. So even though, like you said, the...

Do you think youll have a kind of a more comprehensive outlook and business strategy around that segment come January thank you.

Second one on couponing.

Sure Yeah. The first one premise mix negative on laundry there there is no better metric to look at the amount sold on deal. That's what we've been using for for many many years and the reason we say that is that is the intersection again on on depth and frequency like it's really.

Um, percentage that's on promotion is is low. Um, just curious broadly about about pricing in the market and if the the depth is is worth talking about thanks.

We've been very consistent on couponing.

Yeah, I'll take the second one first. Um,

Like year over year were flat on couponing I think in general we believe that our competitors.

Linked to couponing, a heck of a lot more than we do.

Youre right that's not shown.

Shows what's going on in market. So.

And Nielsen and the way you kind of look at that as maybe through numerator our receipts.

All I can do is point you to the actual numbers that come out of whether you have Nielsen or second of and we are down year over year and promotion. Our competition is up anywhere between 306 hundred basis points. When there is negative price mix in laundry that can be a whole host of things that could also be.

Receipts are actually being scanned.

When you look at EQ, that really means wash loads. And so as you have consumers, trade up to larger sizes, how do you have as you have channels, like club that are growing faster than that means? The larger size is are doing more sales, which then translates into a lower price per EQ and that's part of it.

Is it really maybe the best way to look at that but usually are our competitors rely more heavily on couponing than we do.

Um, and then, if you go to a few of the different retailers, you see not just us but also others.

And that's the case and laundry as well.

Yes, okay.

Yeah.

I mean, we obviously a lot of questions here on discounting and couponing.

Again, as I said before as consumers trade up to larger sizes that mix impact can be a negative in that line. So thats kind of what I would I would I would say consistently number two.

We've shared what we are.

What we're doing here is measured depth breadth all of that and I guess I'll bring it back to gross margins gross margins are doing what they're doing.

On vitamins the Green shoots are two examples I think one would be.

Which speaks to obviously all these elements here so I think.

There's a good story, we've got we're doing things the right way here.

Kind of hard to say, but sometimes when you have consumption go backwards at a retailer in 2025% you think the world is ending but now some of that is discontinuation that have happened and so we have to lap some of that but when you go look at the core skus are the ones that are remaining.

You know, having some rollbacks at at Mass but in general, I think the the biggest thing is the trend on larger sizes which is channel specific in part but also pretty broad broad based uh the second 1 on couponing. Uh, we've been very consistent on couponing. Uh, like year-over-year. We're flat on couponing. I think, in general, we believe that our competitors, uh, linked to couponing a heck of a lot more than than we do, uh, and you're right. That's not

Your next question comes from the line of Robert Moskow with <unk> Cowen.

Go ahead.

Hi, Thanks for the question.

I think the messaging here is that despite a lot of challenges for the consumer categories have been pretty stable in the aggregate running around 2% and.

They are declining at a much lower rate.

Shown in Nielsen, the way you kind of look at that is maybe through Numerator or what you know, receipts that are actually being scanned is really maybe the best way to look at that. But usually, our competitors rely more heavily on couponing than we do.

And that's the case in laundry as well.

Which is it's always encouraging.

Okay.

The second one probably is.

Adjusting for some things youre gaining share.

But when I look at your retail tracking data at least in my metrics things do get weaker in October.

Can I assume that that's a comparison to last year's port strike and maybe just refresh me.

We obviously have a lot of questions here on discounting and couponing. Um, you know, we've shared what we're doing. Here are measures—depth, breadth, all that. And I guess I'll bring it back to gross margins. Gross margins are doing what they're doing, which speaks to obviously, you know, all these elements here. So I think, you know, there's a good story; we're doing things the right way here.

On why that influenced the consumer spending in your categories, rather than just timing of shipments.

Internally, we're focused on how we.

Kind of a plan b on our cost structure and rightsize that business. So I would say by the end of the year consistently again that we'll have more to say and I'm optimistic.

Your next question comes from the line of Robert Moscow with TD Cowen.

Yeah, Robert Yeah in my prepared remarks, I kind of talked a little bit about October but remember.

Please go ahead.

We looked it up last night.

Okay. Thank you on all that I appreciate it.

We believe that for the category and for church <unk> Dwight will be a little bit negative in October a year ago. The port strike had 11% growth in one week for the categories.

Your next question comes from the line and legal.

<unk> America.

Please go ahead.

Hi, good morning. Thank you so much for the question.

That meant a month was around 5% and that wasn't really real that was pantry loading.

I have two parts to that question.

First I wanted to ask on retailer at present and pack size, we're continuing to hear from peers in your space about and they've been a sale to club and online which have been better growth versus food drug and mass. So I was curious if you could talk about this dynamic within your categories.

Probably massive pantry loading that was happening probably more so than other categories as well but.

Hi, thanks for the question. Um, you know, I think the messaging here is that despite, uh, a lot of challenges for the consumer, you know, your categories have been pretty stable in the aggregate, you know, running around 2% and, you know, adjusting for some things you're you're getting share. Um, but you know, when I look at your retail tracking data, at least in my metrics, you know, things do get weaker in October. Um, can I assume that that's a comparison to last year's?

We think that's pretty clear.

Sure I understand but.

November and December I would imagine the pantry loading would be kind of over.

So.

Court strike and maybe just refresh me on why that influences consumer spending in your categories rather than just, you know, timing of shipments.

And then secondly on the M&A Bryan, while you're still digesting touch blend it has performed better than expected and it's an interesting acquisition given clubs blended than some of the specialty beauty stores like Sephora and you've done well in acquisitions. The last few years in personal care and I'm sure you'd like to get back to a more regular cadence.

I guess I'm just unclear like how that would affect your overall results in a quarter and then when I look at your quarterly results last year. It was very stable third quarter fourth quarter were exactly the same so.

Yeah, Robert. Yeah. And my prepared remarks. I kind of talked a little bit about October but uh, remember and we we we looked it up last night. Um,

Alright.

It did it did is it that much of a tough comparison to a year ago.

Despite despite that.

One tuck in acquisition annually. So I was wondering if we should expect a continued focus on personal care or maybe if you'd be willing to explore more in the adjacent EDC. Thanks.

Yes.

We can get into a little bit more detail. It's three things. Okay. So the port strike that happened in October.

And that wasn't really real. That was pantry loading.

If you recall there was a threatened port strike I believe in early January that also had an impact so.

And then you've got to go figure out how much pantry loading really happened was it one unit was at two units was at three units and then you've got to go figure out for the category how long.

Probably massive pantry loading that was happening. Probably more so in other categories as well. But, um, so we think that's pretty clear.

Go to market.

Yeah.

Normal usage goes through but I would tell you October was extremely elevated a year ago.

From an M&A perspective, we're typically typically agnostic on what category as we go into it could be household could be personal care has to be more like functional beauty like we're not a beauty company. We can't perform we don't we don't have to.

When categories are up.

Up 5% a year ago, that's not normal.

So that's that's one the second thing we said in the release was vitamin business for us in Q4, when it's down in consumption in the low twenties. Then Q4 is a seasonal business for vitamins and so just have a little bit more of a of an impact.

Sure, I I understand but you know by November and December. I would imagine the pantry loading would be kind of over. Um so I guess I'm just, you know unclear like how that would affect your overall results in a quarter. And then when I look at your quarterly results last year it was very stable, you know, third quarter, fourth quarter were exactly the same. So you know are did, did it did it is it, is it that much of a tough comparison to a year ago um, despite despite that

yeah, it's

<unk> solution, yet a motive advertising and connection.

And then the third thing that I think Lee mentioned was just our international business in Q4, a year ago had a bit a bit higher of a comp. So all those things are true I guess, but the biggest thing for us and what I said earlier was.

So we are laser focused on that our new president Chuck.

Is laser focused on that as well.

Retailer pack size right not surprisingly different channels are performing at different levels right. The club class of trade is doing extremely well.

We think.

The order of magnitude is it really is more on the port strike and some of the timing on vitamins and.

We continue to to have offerings in club or a strategy internally is how do we make sure that that's always a proactive strategy and not a reactive strategy they have to be on the forefront.

We don't believe there's a roll forward issue into 2026, so that's kind of Hollywood button it up.

Okay. Thank you very much.

Your last question comes from the line of Kevin Zhang with BNP Paribas.

Of of pack sizes and innovation.

But you also have to meet the consumer where they're at in different channels like the drug channel or the dollar channel and have the right pack sizes and the right price point, so it's not.

Please go ahead.

It's three things. Okay, so if the support strike that happened in October, uh, if you recall, there was a threat in port strike, I believe in early January, that also had an impact. So, um, and then you got to go figure out how much pantry loading really happened. Was it 1 unit, was it 2 units, was it 3 units? And then you got to go figure out for the category how long, uh, you know, that normal usage goes through. But I would tell you October was extremely elevated a year ago. Like, when categories are up, uh, up 5% a year ago, that's not normal. Um, so that's 1. The second thing we said in the release was the vitamin business for us in Q4, when it's down in consumption, and.

Great. Thanks, Good morning, everyone and congrats on the good result, this quarter.

Two for me if.

If you don't mind, the first one to kind of revisit the portfolio and trade down risk and then the second one is going to be on the AI. So the first one Rick how do you assess the portfolio today relative to say like the global financial crisis, and I think you know the view would be the church was a big beneficiary.

Either or it's both and we have to be good at both and we've historically done that really well.

Okay, great. Thanks, so much.

Your next question comes from the line.

Low 20s. Then, uh, Q4 is a seasonal business for vitamins, and so it just has a little bit more of an impact. Uh, and then the third thing that I think Lee mentioned was just our international business in Q4 a year ago had a bit, uh, higher of a comp. So, all those things were true, I guess. Uh, but the biggest thing for us, and what I said earlier was, um, we think...

<unk> with Citi.

Please go ahead.

Hi, good morning, everyone.

Larry I would agree with that of trade down risk arm <unk> hammer did well value laundry detergent did well, but it is a more premium portfolio today than it was in brands that you've had success with like batiste and thorough bread and hero and touch land.

Two questions from me one on the retailer inventory levels, obviously, you had some destocking.

The order of magnitude is really, it's more on the port strike and some of the timing on vitamins, and we don't believe there's a role for it issue in 2026, so that's kind of how I would button it up.

Okay, thank you very much.

First half of the year did you see any impact in Q3, and even assuming no impact in Q4, and then as you think about when you six should we think about the first half of the year have been particularly easy comp retailer inventory. So maybe faster growth in the first half I know you haven't given guidance, but just a high level how to think about it.

More are more premium price points so.

Your last question comes from the line of Kevin Grundy with BNP Paribas.

Please go ahead.

How do you assess trade down risk, particularly in those parts of your portfolio today, how do you sort of square that with some of the trade down that were seeing and granted its and household product categories, which you do tend to see a little bit more trade down, but I'd just be kind of curious to get your thoughts on that rig you know granted it skews higher.

And then the second question on the on the margin can.

Can you review the drivers of the lower tariff guidance and maybe if you can give some color also on the broader commodity outlook. Thank you.

The higher income consumers. It does offer unique benefits, but can you kind of have it both ways, where the consumers week within the higher ends of the portfolio. We're going to continue to sustain and then I have a follow up thanks.

Okay, let's try that a couple of questions in there so.

The retailer inventory aside to your point beginning of the year, we had some some pressure points. There are about 300 basis points in the first quarter, maybe 100 basis points of pressure in <unk>.

Yeah, it's a.

A good question that maybe were 40 60 around the financial crisis, now or 60 40.

Not really seeing that we've seen kind of kind of stable levels here in the back half.

And I do believe.

Great. Uh thanks morning everyone and uh congrats on the on the good result. This quarter um 2 for me uh, if you don't mind the first 1 to kind of revisit the portfolio and trade down risk, and then the second 1 is going to be on on AI. So the first 1 Rick did, how do you assess the portfolio? Today relative to say like the global financial crisis and I think, you know, the view would be the church was a big beneficiary. I would agree with that of trade down risk. Armen Hammer did well uh, value laundry detergent did well. But it is a more premium portfolio today than it was and brands that you've had success with like Batiste and the

We will do well in most any economic environment and that's what we've kind of shown over time.

That's what we experienced in the third quarter and Thats, what were kind of expecting as we go forward here.

Uh huh.

Household for sure.

Yep.

<unk> trade down and what's been unique a little bit Kevin is.

All I'll say, a balanced way so we'll watch it closely.

In terms of moving onto.

These premium personal care categories.

I would say in some cases are accelerating during this time.

Tariffs and commodities and things like that.

It's just let's go back we've made a lot of progress on tariffs. So if we go back to April.

And it kind of goes back to what I was.

Thinking about earlier it just to Javier Theres, just two or three or four reasons why.

Canada Bill it could have been as high as $190 million.

But the problem solution, but even the macro behind that is the high end consumer is still doing well and maybe it's a barbell.

We quickly rally the organization around that we made some some tough strategic decisions, but we've also really focused on what can we do about it and.

That's why the club class of trade continues to do well.

Additional productivity targeted pricing actions, we've now moved that down to.

Breath. And then hero and touch land are more are more premium price points. So, you know, how do you assess trade down risk, particularly in those parts of your portfolio today? How do you sort of square that with, you know, some of the trade down that we're seeing and granted, it's in household product categories which you do tend to see a little bit more trade down, but I just be kind of curious to get your thoughts on that. Rick, you know, I granted excuse higher, uh, to higher income consumers, it does offer unique benefits, but can you kind of have it both ways where the consumer is weak? But then the higher ends of the portfolio are going to continue to sustain and then I have a follow-up. Thanks. Yeah and now it's it's a good question. Maybe we were 40 60 around the financial crisis now or 6040. Um,

That's why.

If anything the trade down is happening a little bit into mass.

Two what essentially is a $25 million 12 month number and.

And those trends look pretty good.

And I do believe that, you know, we will do well in most any economic environment, and that's what we've kind of shown over time. Uh,

<unk> released back on August one that number was about 60, it's moved really threefold. This move because we've we've driven more actions around the globe.

So I would I kind of view it as the company is positioned to do well.

Good times or bad times, Yep portfolio shifted a little bit but the.

Household for sure, as folks trade down. And what's been unique a little bit, Kevin, is...

In terms of whether it's negotiations movements I think in the supply chain side your husband, some targeted pricing and then frankly the rates changed but.

Like these premium Personal Care categories.

What brands you have matter matter more than anything more so than the category itself on a mouth wash as an example.

So that's kind of my short answer I think that there.

That puts us in a really good place.

There's more than one reason those brands are doing well and it's a bigger bigger tailwind in the category headwind potentially.

As we noted in the release.

As you kind of look forward to 2026, we should be able to just have it environment of I'll say normal.

Got it thanks for the quick follow up is just around artificial.

Commodity inflation and tariffs should not be a drag.

I would say in some cases are accelerating during this time, um, and it kind of goes back to what I was was thinking about earlier, it's just to Javier there's just 2 or 3 or 4 reasons why. Um, but the problem solution, but even the macro behind that is, the high-end consumer is still doing well. And, uh, maybe it's a barbell. Uh,

Artificial intelligence and what that evolution is going to mean for the CPG industry, Matt likes to say I used to refer to these as the crystal ball kind of questions, but particularly on the heels of the Walmart announcement and its collaboration with open AI I'd be curious to kind of get your thoughts Rick in a world, where AI is naturally going to see much more.

It actually turned out to be an opportunity.

<unk> has still been sticky you sit here today with what our commodity view was for the year, it's still still slightly up from what it was in the beginning of year.

That's why the club class of trade continues to do well. Um, that's why, you know, if anything, the trade down is happening a little bit into mass.

And those trends look pretty good.

I think as we look forward.

Kind of expecting more of the same but we'll leave the rest of the 26 commentary until later.

Greater levels of adoption do you see this evolution is a favorable development for big brands in your portfolio specifically.

Great Super helpful I'll pass it on.

Yes.

Your next question comes from the line of Olivia Tong with Raymond James Please.

And relatedly on the heels as Walmart announcement, how do you assess the risk here that this potentially leads to a balance of power shift to retailers as they exert greater control over the virtual shelf. Thank you.

Please go ahead.

Great. Thanks, first just a clarification.

There wasn't any pull forward from Q3 to Q4 or any other change in timing that helped contribute to the top line upside this quarter.

Matter matters more than anything, uh, more so than the category itself on, uh, on mouthwash, as an example. Um, so that's kind of my short answer. I think that, uh, there's more than one reason those brands are doing well, and it's a bigger.

Yes, I think.

Bigger tailwind than the category headwind potentially.

Yes, my Crystal ball would probably say.

No.

Our company.

Perfect.

They're easy.

Is.

Is laser focused on our brand how.

How do we make sure that we have brands that consumers love and through our advertising through our our marketing through our innovation.

You've done very well in the category, you've driven greater profitability in the category.

If we do those things well.

Then that is an enabler.

Is there you know as you think about the options in front of you is there a thought around potentially being more aggressive on price or things for those consumers who are struggling potential.

Or how we show up online.

And at the end of the day.

Recommendations in the future are going to.

Are going to be.

Potentially looking at it from a share perspective, and you know given the opportunity that you have in front of you and the fact that gross margins have actually shown some pretty nice upside.

Based on how well we are selling.

How well consumers love our products, what the reviews say.

Got it. Thanks the quick. Follow-up is just around, uh, artificial intelligence. And what that evolution is going to mean for the cpg industry, Matt like to sell used to refer to these as the crystal ball kind of questions. But, you know, particularly on on, on the heels of the Walmart announcement and its collaboration with openai, I'd be curious to kind of get your, your thoughts, Rick, you know, in in a world where AI isn't actually going to proceed much much greater levels of adoption. Do you see this Evolution as a favorable development for big Brands and your portfolio specifically and and relatedly uh on the heels of this Walmart announcement? How do you assess the the risk here that this potentially leads to a balance of power shift? Uh, to retailers? Is they exert greater control over the virtual shelf. Thank you.

Yeah, I think.

What new news we have.

You know, my crystal ball would probably say, um,

And.

Same way that.

Our company.

Is.

Advertising has shifted over a long period of time, we have to make sure we're nimble enough and fast enough to adjust.

With speed to the new way of playing the game and.

And we've shown that we can do that.

<unk> always the reason why we performed well over a long period of time right. We're at a 15 or so share. These days were in 30% of households are we.

When Matt and I talked back in 2016, we were 2% of sales for E. Comm now, we're 23% we have adjusted and changed the way we play the game and so that is a competitive advantage for us versus our larger peer set in my opinion and so we have to make sure that we're on the forefront of that and I have no debt.

Is laser focused on Our Brands, like how do we make sure that we have brands that consumers, love and through our advertising, through our, our marketing, through our Innovation, if we do those things. Well

Then, that is an enabler for how we show up online.

We lead in and wash loads like there is a reason for that or right there at value and innovation, so our deep clean innovation.

Um, and at the end of the day,

Recommendations in the future are going to...

While our most expensive form of arm <unk> Hammer is still.

Are we going to be, uh, based on how well we're selling.

<unk>.

We will.

Makes sense, thanks, Rick good luck.

There's still a 70% the price of premium laundry detergent and so innovation matters.

How well do consumers love our products? What do the reviews say?

Yeah.

There are no further questions at this time I'd now like to turn the call over to Mr. Rick.

Uh, what new news do we have?

and,

We're going to have some more of laundry innovation next year.

<unk> for closing remarks. Please go ahead.

And so that's that's why over a long period of time, we've been able to.

Okay. Thanks, Eric well. Thank you for all the questions and look forward to get together next year. If we talk about our go forward strategy on Investor Day, and thank you and see you in January.

<unk> our business.

Great. Thank you.

The same way that, um, advertising has shifted over a long period of time, we have to make sure we're nimble enough and fast enough to adjust and, uh, with speed to the new way of playing the game.

Your next question comes from the line of Javier Escalante with Evercore ISI.

Ladies and gentlemen, this concludes today's call. Thank you all for joining and you may now disconnect.

And we've shown that we can do that. You know, when Matt and I talked back in 2016, we were.

Please go ahead.

Hey, good morning, everyone.

High level question for me why do you think that.

The brother personal care.

Sector is premium I seen in an environment like this.

There are Red Hill continue doing great compounding there is no port strike impact for them why is that is this.

2% of sales for Ecom. Now we're at 23%. We have adjusted and changed the way we play the game, and that is a competitive advantage for us versus our larger, pure set, in my opinion. So we have to make sure that we're at the forefront of that, and I have no doubt that we will.

Makes sense. Thanks, Rick. Good luck.

Differences he China are these different consumers sets.

Because there is legacy brands from which you can gain market share anything that you can tell us to explain what's happening and what does it mean for your future growth into 2026. Thank you.

Yeah. No further questions at this time. I'd like to turn the call over to Mr. Richard Dierker.

For closing remarks, please go ahead.

It's a good question Javier it's never one thing it's always.

Okay, thanks, Eric. Well, thank you for all the questions, and I look forward to getting together next year. If we talk about our go-forward strategy on Investor Day, and thank you, and see you in January.

It's a few different things in my opinion I believe it's these are great problem solution brands right their breath really works for bad breath.

Ladies and gentlemen, this concludes today's call. Thank you for joining, and you may now disconnect.

However, it's also appeals to the to the young.

And Ah NL consumer great packaging great story.

Great social media presence.

Hero.

A problem solution really works.

The best performing Acme patch out there.

And.

Touchline, It really works and at Premier premium rises a kind of a tired old category with the.

With fragrance and Seth on the go convenience.

So.

I would say there is a problem solution aspect to it.

Hey.

Theres, a great branding ex aspect to it.

Theirs.

Yeah.

Some of the competition in those categories isn't.

It's been around for a really long time isn't as new and fresh I would say so it's not just one thing.

Multiple things Thats why we believe at the end of the day.

There is a lot of opportunity.

And those three businesses right and I said in my prepared remarks household penetration for hero nine.

Category <unk> 28 per their breath of 11 categories 65 <unk> seven.

Category <unk> 42.

And that's why we keep getting TDP growth as well so again, it's a mix of all those things.

Thank you.

Your next question comes from the line of Lauren Lieberman with Barclays.

Please go ahead great.

Great. Thanks, Good morning, guys.

One thing I want to talk about with couponing and just how much couponing is currently.

Part of your strategy how much activity there has been because this is something that kind of shows up.

No differently than market, you can't necessarily see it.

And the Nielsen data. So I was curious if you could talk about couponing.

And then also just looking specifically at laundry and the data it does show price per EQ as.

Is down low single digits, so even though.

You said the percentage that's on promotion is low.

Just curious probably of that about pricing in the market and if the depth is it worth talking about thanks.

Yes, I'll take the second one first.

<unk>.

When you look at EQ that really means wash loads and so as you have consumers trade up to larger sizes.

As you would have channels like club that are growing faster than that means the larger sizes are doing more sales, which then translates into a lower price per EQ and thats part of it.

And then if you go to a few of the different retailers you see not just us but also others.

Now, having some rollbacks at math, but in general I think the biggest thing is the trend on larger sizes, which is channel specific and part but also pretty broad based.

Second one on couponing.

We've been very consistent on couponing.

The year over year were flat on couponing I think in general we believe that our competitors.

Linked to couponing, a heck of a lot more than we do.

Youre right that's not shown.

And Nielsen and the way you kind of look at that as maybe through numerator our.

Receipts are actually being scanned.

Is it really maybe the best way to look at that but usually are our competitors rely more heavily on couponing than we do.

And Thats, the case and laundry as well.

Yes, okay.

Okay.

I mean, we obviously a lot of questions here on discounting and couponing.

We've shared what we're.

What we're doing here is measured depth breadth all of that and I guess I'll bring it back to gross margins gross margins are doing what they're doing.

Which speaks to obviously you know all these elements here. So I think you know.

It was a good story, we've got we're doing things the right way here.

Your next question comes from the line of Robert Moskow with TD Cowen.

Please go ahead.

Hi, Thanks for the question.

I think the messaging here is that despite a lot of challenges.

The consumer categories have been pretty stable in the aggregate running around 2% and adjusting for some things youre gaining share.

But when I look at your retail tracking data at least in my metrics things do get weaker in October.

Can I assume that that's.

Our comparison to last year's.

Short strike and maybe just refresh me.

On why that influenced the consumer spending in your categories, rather than just timing of shipments.

Yeah, Robert Yeah in my prepared remarks, I kind of talked a little bit about October but remember.

We looked it up last night.

We believe that for the category and for church <unk> Dwight will be a little bit negative in October a year ago. The port strike had 11% growth in one week for the categories.

That meant a month was around 5% and that wasn't really real that was pantry loading.

Probably massive pantry loading that was happening probably more so than other categories as well but.

That's pretty clear.

Sure I understand but by November and December I would imagine the pantry loading would be kind of over.

So I guess I'm just unclear how that would affect your overall results in a quarter and then when I look at your quarterly results last year. It was very stable third quarter fourth quarter were exactly the same.

So.

Does it does it is it is it that much of a tough comparison to a year ago.

Despite despite that.

Yes.

You can get into a little bit more detail. It's three things okay. So the port strike that happened in October.

If you recall there was a threatened port strike I believe in early January that also had an impact so.

And then you've got to go figure out how much pantry loading really happened was it one unit was at two units was at three units and then you've got to go figure out for the category how long.

Now that that normal usage goes through but I would tell you October was extremely elevated a year ago.

When categories are up.

Up 5% a year ago, that's not normal.

So that's that's one the second thing we said in the release was.

<unk> business for us in Q4, when it's down in consumption in the low twenties. Then Q4 is a seasonal business for vitamins and so just have a little bit more of a of an impact.

And then the third thing that I think Lee mentioned was just our international business in Q4, a year ago had a bit.

A bit higher of a comp so all of those things are true I guess, but the biggest thing for us and what I said earlier was.

We think.

The order of magnitude is it really is more on the port strike and some of the timing on vitamins and.

We don't believe there is a roll forward issue into 2026, so that's kind of high with button it up.

Okay. Thank you very much.

Your last question comes from the line of Kevin Zhang with BNP Paribas.

Please go ahead.

Great. Thanks, Good morning, everyone and congrats on the good result, this quarter.

Two for me.

If you don't mind, the first one to kind of revisit the portfolio and trade down risk and then the second one is going to be on on AI. So the first one Rick how do you assess the portfolio today relative to say like the global financial crisis, and I think you know.

The view would be the church was a big beneficiary would agree with that of trade down risk arm <unk> Hammer did well a value laundry detergent did well, but it is a more premium portfolio today than it was in brands that you've had success with like batiste, and Thoroughbred and hero and touch land or more.

Or are more premium price points so.

The higher income consumers. It does offer unique benefits, but can you kind of have it both ways, where the consumers week within the higher ends of the portfolio, we're going to continue to sustain that I have a follow up thanks.

Yeah. It's a good question that maybe were 40 60 around the financial crisis, now or 60 40.

And I do believe that.

We will do well in most any economic environment and that's what we've kind of shown over time.

Uh huh.

Household for sure folks trade down and what's been unique a little bit Kevin is I think these premium personal care categories.

I would say in some cases are accelerating during this time.

And it kind of goes back to what I was.

Thinking about earlier, it's just to Javier Theres, just two or three or four reasons why.

But the problem solution, but even the macro behind that is the high end consumer is still doing well and maybe it's a barbell.

That's why the club class of trade continues to do well.

That's why.

If anything the trade down is happening a little bit into mass.

And those trends look pretty good.

So I would I kind of view it as the company is positioned to do well.

Good times or bad times, Yep portfolio has shifted a little bit but the.

What brands you have matter matter more than anything more so than the category itself on our mouthwash as an example.

So that's kind of my short answer I think that.

Theres more than one reason those brands are doing well and it's a bigger bigger.

Bigger tailwind in the than the category headwind potentially.

Got it. Thanks, a quick follow up is just around our artificial.

Artificial intelligence and what that evolution is going to mean for the CPG industry, Matt like sorry.

So I used to refer to these as the crystal ball kind of questions, but particularly on the heels of the Walmart announcement and its collaboration with open AI I'd be curious to kind of get your thoughts Rick.

World, where AI is naturally going to see much much greater levels of adoption do you see this evolution is a favorable development for big brands in your portfolio, specifically and Relatedly on the heels as Walmart announcement, how do you assess the risk here that this potentially leads to a balance of power shift to retailers as they exert greater control.

Over the virtual shelf. Thank you.

Yeah I think.

Yes, my Crystal ball would probably say.

Our company.

As.

Is laser focused on our brands.

How do we make sure that we have brands that consumers love.

And through our advertising through our our marketing through our innovation, if we do those things well.

Then that is an enabler for how we show up online.

And at the end of the day.

Recommendations in the future.

Going to.

Are going to be paid.

Based on how well we're selling.

How well consumers love our products, what the reviews say.

What new news we have.

And.

The same way that.

Advertising has shifted over a long period of time, we have to make sure we're nimble enough and fast enough to adjust.

With speed to the new way of playing the game and.

And we've shown that we can do that.

But we.

We will.

Makes sense, thanks, Rick good luck.

Yeah.

There are no further questions at this time I'd now like to turn the call over to Mr. Rick Derrek Derrek here for closing remarks. Please go ahead.

Thanks, Eric well. Thank you for all the questions and look forward to get together next year. If we talk about our go forward strategy on Investor Day, and thank you and see you in January.

Ladies and gentlemen, this concludes today's call. Thank you all for joining and you may now disconnect.

[music].

Yeah.

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Yeah.

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Q3 2025 Church & Dwight Co Inc Earnings Call

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