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Sep 30, 2025
Clorox Q1 2026 Earnings Report
Clorox reported a decline in sales and earnings due to the anticipated ERP transition impact.
Key Takeaways
Clorox experienced a 19% drop in net sales and a 54% decline in adjusted EPS in Q1 FY26, primarily due to lower shipments as retailers drew down inventories built ahead of the ERP system transition. Despite the temporary setback, the company emphasized that the majority of the ERP rollout is complete, positioning it for improved performance in the second half of the fiscal year.
Net sales fell 19% to $1.43 billion due to lower shipment volume tied to the ERP transition.
Adjusted EPS declined significantly to $0.85 from $1.86 in the prior year.
Gross margin contracted by 410 basis points due to lower volume and higher logistics costs.
ERP implementation is mostly complete, and focus is shifting to profitable growth initiatives.
Revenue by Segment
Revenue by Geographic Location
Forward Guidance
Clorox maintained its full-year outlook but expects earnings and sales to come in toward the lower end of guidance, reflecting the lingering effects of the ERP transition.
Positive Outlook
- ERP rollout largely completed, paving way for improved operations.
- Company reaffirmed adjusted EPS guidance range of $5.95–$6.30.
- Slightly lower input costs expected.
- Increased investment in demand-creation to drive H2 recovery.
- Digital tools and innovation to support long-term growth.
Challenges Ahead
- ERP transition led to significant shipment and market share losses.
- Sales expected to decline 6% to 10% for FY26.
- Adjusted EPS expected to fall 23% to 18% year-over-year.
- Gross margin to remain under pressure with 50–100 bps decline.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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