Colgate-Palmolive’s third quarter results reflected a stable but challenging consumer environment, as the company delivered sales in line with Wall Street expectations and non-GAAP profit that modestly exceeded consensus. CEO Noel Wallace cited persistent headwinds including consumer uncertainty, cost inflation, and heightened promotional activity as pressures on sales and profit growth. Management attributed the flat organic sales and declining volumes primarily to ongoing sluggishness in North America and category softness in developed markets, while highlighting sequential improvement in performance outside of skin health. Wallace noted, “We are operating with determination and focus,” pointing to broad-based market share stability and continued investment in advertising and innovation as critical to navigating the current landscape.
Is now the time to buy CL? Find out in our full research report (it’s free for active Edge members).
Colgate-Palmolive (CL) Q3 CY2025 Highlights:
- Revenue: $5.13 billion vs analyst estimates of $5.14 billion (1.9% year-on-year growth, in line)
- Adjusted EPS: $0.91 vs analyst estimates of $0.89 (2.4% beat)
- Adjusted EBITDA: $1.22 billion vs analyst estimates of $1.22 billion (23.7% margin, in line)
- Operating Margin: 20.6%, in line with the same quarter last year
- Organic Revenue was flat year on year vs analyst estimates of 1.3% growth (89.3 basis point miss)
- Sales Volumes fell 1.9% year on year (3.7% in the same quarter last year)
- Market Capitalization: $62.28 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Colgate-Palmolive’s Q3 Earnings Call
- Dara Mohsenian (Morgan Stanley) asked about the duration of category softness and the timeline for Colgate-Palmolive’s strategic initiatives to drive organic sales growth. CEO Noel Wallace responded that sluggishness is expected in the near term, but initiatives under the 2030 Strategy are designed to stimulate growth regardless of category trends.
- Peter Grom (UBS) questioned the impact of the Colgate Total formula change in Latin America and whether growth in the region would improve. Wallace detailed the consumer-driven formula adjustment and expressed confidence in market share recovery as the new product is adopted.
- Filippo Falorni (Citi) explored the effects of India’s GST change and local competition. Wallace explained that the tax reduction caused short-term disruption but is expected to boost category consumption over time, with a renewed focus on premiumization in urban areas.
- Lauren Lieberman (Barclays) inquired about the sustainability of pricing in Europe. Wallace said positive pricing should continue but could be challenged by prolonged inflation, underscoring the role of innovation in maintaining premium positioning.
- Stephen Powers (Deutsche Bank) asked how Colgate’s investments in AI and innovation differentiate it versus peers and whether they are points of competitive advantage. Wallace emphasized that technology and process improvements are being deployed to gain a market edge and drive category growth with retailers.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will be monitoring (1) the pace at which the new Colgate Total formula regains market share in Latin America, (2) the effectiveness of science-based innovation and AI-driven marketing in driving demand across premium and value segments, and (3) the progression of the strategic growth and productivity program in delivering cost savings and operational improvements. Continued supply chain optimization and the impact of pricing actions will also be key areas of focus.
Colgate-Palmolive currently trades at $77.50, up from $76.51 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members).
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