What to Expect from Procter & Gamble's Upcoming Earnings Report

Procter & Gamble to Report Quarterly Earnings

The Expectations

Wall Street analysts surveyed by Refinitiv are anticipating that Procter & Gamble (P&G) will report earnings per share of $1.32 and revenue of $19.98 billion in its upcoming quarterly earnings report.

Raising Prices

P&G, the maker of popular products like Tide detergent, Crest toothpaste, and Gillette razors, has been increasing prices on its goods for nearly two years to offset rising commodity costs. In fact, the company's prices in its fiscal third quarter were 10% higher compared to the same period last year.

The Customer Impact

However, these higher prices have led to a decrease in customer demand. Many consumers have switched to cheaper private label options or have been buying P&G products less frequently. In the last quarter, P&G experienced a 3% decrease in volume.

Market Performance

Despite this decline in volume, P&G has not seen the same drop in demand in its largest market, the United States. Additionally, its second-largest market, China, has been recovering from the effects of the Covid-19 pandemic.

Future Outlook

Looking ahead to fiscal year 2024, Wall Street analysts are predicting that P&G's earnings per share will grow by 8.8% and revenue will increase by 4.5%.

Market Value

So far this year, P&G shares have only risen by 1%, resulting in a market value of $361 billion for the company.

Conclusion: Impact on New Businesses

The quarterly earnings report and performance of Procter & Gamble (P&G) provide valuable insights into the current market dynamics and consumer behavior, which can have implications for new businesses entering the industry. One key aspect to note is P&G's strategy of raising prices to counter rising commodity costs. While this approach might be effective for an established company like P&G, it could present challenges for new businesses. Increasing prices may lead to a decrease in customer demand, as consumers may switch to cheaper alternatives or reduce their purchases altogether. Therefore, new businesses should carefully consider their pricing strategies, finding a balance between maintaining profitability and ensuring affordability to attract customers. Another factor impacting P&G's performance is the varying demand in different markets. While P&G has seen a decline in volume overall, the United States market has remained relatively stable. This suggests that understanding specific market trends and consumer preferences is crucial for success. New businesses should conduct thorough market research to identify their target market's needs and preferences, allowing them to tailor their products and marketing strategies accordingly. Lastly, the future outlook for P&G indicates positive growth expectations. This suggests that despite the challenges faced, P&G is adapting its strategies to navigate the changing market landscape successfully. New businesses can learn from P&G's adaptability and focus on long-term growth, investing in innovation and maintaining a customer-centric approach. In summary, new businesses should carefully analyze market trends, pricing strategies, and consumer preferences to navigate the ever-evolving consumer goods industry. By being agile, understanding their target market, and focusing on long-term growth, new businesses can position themselves for success in a competitive landscape. Article First Published at: https://www.cnbc.com/2023/07/28/procter-gamble-pg-q4-2023.html