Clorox Company
Q2 2026 Earnings
Market Reaction
S&P 500 over the same 30 days: −1.15%.
Did CLX Beat Earnings? Q2 2026 Results
Clorox delivered a split verdict in its fiscal second-quarter 2026 results, beating revenue expectations while falling short on earnings, as the hangover from last year's ERP-related inventory build continued to weigh on the business. Adjusted EPS came in at $1.39, missing the $1.43 consensus by 3.03%, while net sales of $1.67 billion topped the $1.64 billion estimate by 2.19%, though revenue still slipped 0.8% year over year. The primary culprit behind the bottom-line pressure was a combination of higher manufacturing and logistics costs, which created a 240-basis-point gross margin headwind, compressing the overall margin to 43.2%. Segment results were uneven, with International posting 7% sales growth and a 48% surge in adjusted EBIT, while the Household segment fell 6% and saw its adjusted EBIT plummet 54%. Looking ahead, Clorox reaffirmed its full-year adjusted EPS guidance of $5.95 to $6.30, though management noted expectations currently sit at the lower end of that range, with an approximately $0.90 per-share drag tied to reversing those prior ERP-related shipments still clouding the outlook.
- Lower consumption across several categories weighing on sales
- Higher manufacturing and logistics costs pressuring gross margin by 240 basis points
- Cost savings of 170 basis points partially offsetting margin headwinds
- Lapping of prior-year cyberattack insurance recoveries impacting GAAP EPS comparison
- Lapping of prior-year tax rate benefits reducing adjusted EPS
- ERP-related inventory drawdown by retailers creating transitory sales headwind
- International segment benefited from favorable price mix, FX, and volume
- Household segment impacted by shift to larger sizes in Bags and Wraps
“Our second-quarter results were generally in line with our expectations and reflect continued progress against our strategic priorities. These results support our ability to reaffirm our fiscal year outlook in what remains a challenging and volatile environment.”
Clorox CEO, on the earnings call
Forward Guidance & Outlook
Clorox confirmed its full-year FY2026 outlook. Net sales are expected to decline 6% to 10%, including less than a point of negative impact from the VMS divestiture. Organic sales are expected to decrease 5% to 9%, including a ~7.5-point negative impact from reversing ERP-related incremental shipments. Gross margin is expected to be down 50 to 100 basis points. SG&A is expected at about 16% of net sales, including ~90 basis points from digital transformation investments. Advertising spending is expected at ~11% of net sales. Effective tax rate is expected at ~24%. GAAP diluted EPS is guided at $5.60 to $5.95 (down 14% to 9% YoY), and adjusted EPS at $5.95 to $6.30 (down 23% to 18% YoY). The ~$0.90 EPS headwind from reversing ERP-related shipments is the most significant transitory factor. Current expectations sit at the lower end of ranges due to order fulfillment challenges earlier in the year. This outlook excludes the impact of the GOJO Industries acquisition, which is expected to close before the end of FY2026.
CLX YoY Financials
CLX Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.