Procter & Gamble Cuts Fiscal-Year Guidance After 3Q Sales Decline

By Kelly Cloonan

Procter & Gamble lowered its fiscal-year outlook after posting lower sales in the third quarter amid a challenging consumer environment.

The consumer-products company logged a profit of $3.77 billion, or $1.54 a share, in the quarter ended March 31, compared with $3.75 billion, or $1.52 a share, a year earlier.

Adjusted earnings per share were $1.54. Analysts polled by FactSet expected $1.52 a share.

Sales fell 2%, to $19.78 billion, behind analysts' forecasts for $20.15 billion, according to FactSet.

The top line was up 1% on an organic basis, driven by higher pricing. Mix and organic volume had a neutral effect on sales, the company said.

Organic sales gains in the company's beauty, grooming and healthcare segments offset a slight decline in its baby- and feminine-care unit. Organic volume and sales were flat for the company's fabric- and home-care segment.

P&G's gross margin fell during the quarter as unfavorable mix, product reinvestments, and higher commodity costs more than offset benefits from productivity savings and higher prices.

Chief Executive Jon Moeller said the quarter provided a challenging and volatile consumer and geopolitical environment.

For fiscal 2025, the company now expects sales to be roughly flat compared with the prior year, down from prior guidance for growth of 2% to 4%.

The company expects organic sales growth of about 2%, down from previous expectations for 3% to 5% growth.

The company also lowered its guidance for net earnings-per-share growth to a range of 6% to 8% from between 10% to 12%.

Moeller said the outlook adjustments reflect underlying market conditions.

Write to Kelly Cloonan at kelly.cloonan@wsj.com