Kimberly-Clark Q3 2026: Six Straight Beats, Now Carrying Kenvue's Debt

Kimberly-Clark reported adjusted EPS of $1.70 for the third quarter of 2026, beating the $1.65 consensus estimate. Revenue of $4.13 billion also came in ahead of the $4.12 billion estimate. The quarter extended the company's streak of beating Wall Street's earnings expectations to six consecutive periods.

Organic sales fell 1.3%, with a China social media disruption accounting for roughly 270 basis points of the drag. International Personal Care bore the sharpest pain, with operating profit there falling 32.7% to $144 million. North America was more resilient, posting organic growth of 0.4% and higher operating profit of $657 million.

The quarter's biggest storyline arrived just three days before the filing: the $49 billion Kenvue acquisition closed on November 2, 2026. CEO Mike Hsu called it "a defining moment in the 154 year history of Kimberly-Clark," framing the deal as the start of a new chapter in consumer health. The company acknowledged that the acquisition is expected to substantially increase its indebtedness going forward, making debt management a central focus for investors watching the combined entity.

Despite the organic softness and the looming leverage question, management reaffirmed the 2026 standalone outlook. That includes mid-single-digit adjusted operating profit growth on a constant-currency basis and high-single-digit adjusted EPS growth from continuing operations on the same basis. Organic sales growth is expected to land roughly 100 basis points below weighted average category growth of approximately 1.7%, with management attributing most of that shortfall directly to the China disruption.

Adjusted gross margin contracted 130 basis points to 35.5%, pressured by unfavorable pricing net of cost inflation and supply chain investments, though productivity savings offered a partial offset. Lower net interest expense and a lower adjusted tax rate helped drive adjusted EPS from continuing operations up 17.2%. The quarterly dividend was declared at $1.28 per share, up from $1.26 in the prior year period.