• by Les Luchter , April 24, 2025

Projecting a tariff impact of $1 billion to $1.5 billion over the next year -- or 3% of the cost of goods sold -- while announcing lower-than-expected sales of $19.8 billion for Q3 of its fiscal year Q3, Procter & Gamble’s CFO Andre Schulten told analysts Thursday morning that the CPG giant would get through the current economic volatility largely by “doubling down on innovation.”

Productivity and pricing will probably also be employed as “short-term levers,” he said.

CEO Jon Moeller, meanwhile, told CNBC that price hikes are “likely” in the new fiscal year, which starts in July.

Moeller, doing one-on-ones with media while Schulten soloed with the analysts, also told Yahoo Finance that consumers have been shifting behaviors to save money. An example: they’re doing fewer laundry loads to conserve detergent.

Speaking of detergent, Schulten singled out three products in that category as examples of P&G’s focus on using innovations to drive sales: Oxi Boost Power Pods, with “two times the Oxi power”; Gain Odor Defense detergent, which “lifts away tough odors at the source and includes 40% more freshness ingredients”: and Tide EVO, “offering superior cleaning performance in fully recyclable packaging,” which is “exceeding expectations in our now expanded Colorado test market… proving to be highly incremental to category growth despite its premium pricing.”

Schulten also highlighted the following as innovations:

--              Crest 3D White Deep Stain Remover, which “works in just one day to dissolve the bonds that lock stains in your teeth,” is “driving Crest market share growth in the U. S.”

--              The new Oral-B iO 2, “designed to help consumers trade up from a manual toothbrush to a power brush,” has helped push total Oral B PowerBrush shares up 50 basis points in the U.S.”  

--             Upgrades to blades and razor handles on Gillette Labs and Venus, with Venus now including shower hooks on all handles. And Tampax, which now has “20% longer leak upgrade for improved leak protection.”

Schulten also promised upcoming innovations in Pampers, Febreze, Dawn, Cascade, Mr. Clean and Swiffer.

“We chose to maintain our innovation plans during the early stages of COVID. We did the same in the early stages of the severe inflationary cycle a few years ago,” Schulten stated. “It’s unclear how long this period of consumer softness will last, but we know P &G will be stronger if we keep innovation across every part of our portfolio and keep investing to drive consumer interest and demand in our categories.”

“The primary vehicle of investment,” Schulten said, will be media advertising, although he did note that in the fiscal year to date, advertising has been “flat in terms of percentage of sales.”

All the innovation, he continued, can help fuel a $5 five billion growth opportunity in the U.S. by “driving household penetration of our biggest brands.”

Tide, Cascade and Bounty, for example, are only in 40% or less of U.S. households, providing “a huge opportunity by further segmenting the consumer base and being more targeted in serving them… and driving trial-and-repeat.”

On the tariff front, Schulten said the largest tariff impacts so far have been in “raw and packaging materials, and some finished product sources from China.”  

Meanwhile, “the largest impact of responsive tariffs on U.S. exports is from finished product shipped from the U.S. to Canada."

Speaking of Canada, Schulten acknowledged that P&G is “seeing some noise” up north regarding consumer sentiment against American products, but so far, no “change of consumption behavior that we can attribute to any of those dynamics.” Indeed, he said, with P&G’s brands in most markets for decades, “consumers view them as local brands that they grew up with, not as a U.S. brand that is foreign to them. That’s the case in Europe, in China, and even in Canada.”