Clorox raises forecast after strong quarterly results

The cleaning product manufacturer Clorox has raised its profit forecast for the year after the company significantly exceeded expectations for the quarter. Thanks to robust demand for its cleaning and household products, Clorox was more than able to offset the impacts of a cyberattack from the previous year. Sales in the first quarter soared as Clorox launched new and improved products and strategically invested in advertising. Price-sensitive consumers, in particular, responded positively to these measures. Sales for products like Pine-Sol were further boosted by increased promotional efforts after experiencing declines in the preceding two quarters. A notable increase of 38% in the Health and Wellness segment, which accounts for 35% of total revenue, also contributed to sales growth. This segment benefited from a similarly strong increase in sales volumes. Additionally, the company experienced diminishing effects from supply chain disruptions caused by the cyberattack, allowing it to benefit from cost savings and increased volumes. Kevin Jacobsen, Clorox's CFO, stated that consumer behavior had slowed by the end of the last fiscal year. He expects that consumers will continue to feel pressured this year. The company achieved a notable expansion of its gross margin by 740 basis points to 45.8%. While Clorox and Colgate-Palmolive both reported an increase in sales, Kimberly-Clark is facing consumer migration towards more affordable alternatives. Clorox was able to increase its revenues by 27% to $1.76 billion in the quarter ending on September 30, surpassing expectations for an 18.8% revenue increase to $1.65 billion. On an adjusted basis, earnings per share were $1.86, compared to the analyst estimate of $1.39 according to LSEG data. For the fiscal year 2025, Clorox expects earnings per share to be between $6.65 and $6.90, up from the previous forecast of $6.55 to $6.80.