Clorox Company
Q3 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +7.22%.
Did CLX Beat Earnings? Q3 2025 Results
Clorox posted a disappointing third quarter for fiscal year 2025, missing on both the top and bottom lines as macroeconomic headwinds and the lingering effects of recent divestitures weighed on results. Revenue fell 8.1% year-over-year to $1.67 billion, coming in 2.86% below the $1.72 billion consensus estimate, while adjusted EPS of $1.45 trailed the $1.56 Street forecast by 6.90%. The primary culprit was the divestiture of its Better Health VMS and Argentina businesses, which stripped meaningful scale from reported sales, though organic sales also slipped 2% as consumers pulled back spending amid broader economic uncertainty, a trend management warned will persist into the fourth quarter. On a brighter note, Clorox extended its streak of gross margin expansion to ten consecutive quarters, with margins climbing 240 basis points to 44.6%. Looking ahead, the company maintained its adjusted EPS guidance of $6.95 to $7.35 for the full year while navigating an anticipated $100 million tariff headwind, with management actively exploring sourcing and reformulation changes to offset the impact over time.
- 10th consecutive quarter of gross margin expansion driven by cost savings and divestiture benefits
- Health and Wellness segment grew 3% on 7 points of higher volume driven by Cleaning consumption
- Household segment declined 11% due to lower consumption, Kingsford shipment timing, and retailer inventory adjustments in Litter
- Cyberattack insurance recoveries of $35 million in Q3
- Organic sales decreased 2% driven by unfavorable price mix with flat organic volume
- Consumption slowdown across most businesses driven by macroeconomic uncertainties
“In the third quarter, heightened macroeconomic uncertainties drove changes in shopping behaviors, resulting in temporary category slowdowns and lower sales. We expect these slowdowns to persist in the fourth quarter, as reflected in our updated outlook.”
Clorox CEO, on the earnings call
Forward Guidance & Outlook
Clorox updated its FY2025 outlook to reflect macroeconomic and geopolitical headwinds including tariff impacts and consumer category slowdowns expected to persist into Q4. Net sales now expected to decline 1% to flat (previously slightly more favorable), including ~2 points negative impact from the Argentina divestiture and ~3 points from the VMS divestiture. Organic sales expected to grow 4% to 5%, including 2-3 points from ERP transition-related incremental shipments expected to reverse in the front half of FY2026; excluding ERP impact, organic sales expected up about 2%. Gross margin now expected to expand ~150 basis points. GAAP diluted EPS raised to $5.73-$6.13 (from $5.52-$5.92), a 155%-172% YoY increase reflecting lapping of prior-year one-time charges, including $0.50-$0.70 from ERP-related incremental shipments. Adjusted EPS maintained at $6.95-$7.35, a 13%-19% YoY increase, with macro headwinds offset by higher ERP shipment benefits. Effective tax rate expected at ~26% (GAAP) and ~23% (adjusted). Advertising spending expected at 11%-11.5% of net sales. SG&A expected at 15%-16% of net sales.
CLX YoY Financials
CLX Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.