This ranking evaluates how Fortune 500 companies are deploying AI, and how technology leaders value those investments relative to industry peers.

Fortune AIQ 75

The companies on the Global 500 employ 70.2 million people, and their revenue represents more than one-third of the world’s GDP.

Fortune Global 500

With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

The 300 companies on this year’s list brought in over $12.5 trillion in revenue for the latest 12 months, with the median revenue figure at $24 billion.

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World's Most Admired Companies

Fortune AIQ 50

The corporations on our annual list of the world's 500 largest companies combined to generate $41.7 trillion in revenue over the past year.

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

The 300 companies on this year’s list brought in over $12.6 trillion in revenue for the latest 12 months, with the median revenue figure at $22 billion.

Leaders in all industries rely more than ever on Big Tech—and appreciate the giants that deliver, at scale, without drama.

The corporations on our annual list posted aggregate revenues of $41 trillion for the second year in a row.

Industries included in the sector are home equipment and furnishings and household and personal products.

Fortune Sector Leaders: Household Products

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

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The 25th Fortune World’s Most Admired Companies list suggests that tech giants’ peers respect them as much as ever.

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The corporations on our annual list of the world’s largest companies delivered a record $41 trillion in aggregate revenues.

The 300 companies on this list are transforming industries from the inside out.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

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The consumer packaged goods giant Procter &amp; Gamble, famous for products ranging from Tide detergent to Pepto Bismol, saw revenue increase 5% in 2022, to $80.2 billion. 
<ul> 
 	<li>As inflation raged in 2022 and into 2023, P&amp;G was among the most prominent companies criticized by consumer activists for “greedflation,” as it repeatedly raised prices for consumers in attempts to offset its own rising costs.</li> 
 	<li>P&amp;G raised its year-end sales outlook in April 2023 from a 1% decline to a 1% increase, a sign it believes it’s turned the corner on inflation.</li> 
 	<li>The company is diversifying away from traditional retail channels; its e-commerce sales grew 11% in 2022 and now make up 14% of total sales.</li> 
</ul>

Just as it dominates our economy, Big Tech now dominates Fortune’s annual ranking of corporate reputation.

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Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

This year’s Fortune 500 marks the 68th running of the list.

F500 2022-Procter and Gamble

Procter &amp; Gamble makes and sells familiar household brands such as Tide laundry detergent, Gillette razors, Crest toothpaste, and Old Spice deodorant. Like other consumer goods giants, P&amp;G has faced a tricky balancing act: It is benefiting from rising sales in a recovering economy (it brought in $76.1 billion in revenue in its last fiscal year, a 7.3% increase from the year prior) while also striving to protect its profit margins from inflation. The company also faced a potential self-inflicted wound going into 2022: The detection of benzene, a potential carcinogen, in some of its aerosol deodorants led P&amp;G to institute a recall in November 2021, and the problem has since prompted multiple lawsuits.

After a year in which humanity leaned more heavily than ever on tech giants, see which companies topped Fortune's ranking of corporate reputation.

WMAC 2021-21-Procter and Gamble

Total revenue for the world’s biggest companies fell 4.8% to $31.7 trillion this year—the first decline in half a decade.

G500 128 Procter & Gamble

The consumer products giant emerged from the COVID-19 crisis with strong profits, exceeding its own fiscal year 2020 goals with 6% organic sales growth and 13% core earnings-per-share growth. That was partially thanks to a spike in demand for home-goods brands like Charmin, Bounty, Downy, and more. Procter &amp; Gamble experienced a substantial leap in revenue almost across the board, including net sales of $19.7 billion in the second quarter of fiscal year 2021, up 8% from the year before. P&amp;G’s share price has weathered market volatility, rising 15.4% from March 2, 2020, through May 24, 2021. The company even increased its quarterly dividend by 10% in April 2021, making this the 65th consecutive year that P&amp;G has boosted its dividend.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-43-Procter and Gamble

For an astounding 13th straight year, Apple claims the top spot in Fortune’s annual ranking of corporate reputation, based on a survey of almost 3,800 executives, directors, and analysts.

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-156-Procter-and-Gamble

The consumer products giant emerged from a major reorganization in 2019 and ended the calendar year with an optimistic outlook for investors across the board, including net sales of $17.8 billion in the first quarter of fiscal year 2020, up 7% from the year before. What would be welcome news during normal times became a bulwark in the age of the novel coronavirus. P&amp;G’s share price weathered the stock market volatility that marked the early weeks of the pandemic’s spread, and even as other companies cut their quarterly dividends, P&amp;G made its payout for its 64th consecutive year.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-050-Proctor-and-Gamble

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This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

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This year's Fortune 500 marks the 64th running of the list.

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The world's 500 largest companies generated $31.2 trillion in revenues and $1.7 trillion in profits in 2014. Together, this year's Fortune Global 500 employ 65 million people worldwide and are represented by 36 countries.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Global business is back. After limping through a worldwide financial crisis and economic slowdown, the 500 largest companies ranked by revenues shattered all sorts of performance records in 2013: They racked up combined revenues of $31.1 trillion, up 2.5% from 2012, and profits soared 27% to nearly $2 trillion. China’s 95 companies (up from 89 last year) posted $5.8 trillion in revenues. The U.S. has four fewer companies on the list than last year but remains (for now) the country leader, with 128 corporations on the list—including No. 1 Wal-Mart Stores—reporting $8.6 trillion in revenues. 

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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The consumer packaged goods company Procter &amp; Gamble operates in five segments: beauty; grooming; health care; fabric and home care; and baby, feminine, and family care. Founded in 1837 when a British candlemaker and an Irish soapmaker merged their businesses in Cincinnati, its holdings include Tide, Pampers, Downy, Gillette, and Oral-B.

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Procter & Gamble (PG): Company Profile, Stock Price, News, Rankings

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Procter & Gamble

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Good morning and welcome to Procter & Gamble's quarter-end conference call. Today's event is being recorded for replay. This discussion will include a number of forward-looking statements. If you will refer to P&G's most recent 10-K, 10-Q, and 8-K reports, you will see a discussion of factors that could cause the company's actual results to differ materially from these projections.

As required by Regulation G, Procter & Gamble needs to make you aware that during the discussion, the company will make a number of references to non-GAAP and other financial measures. Procter & Gamble believes these measures provide investors with useful perspective on underlying business trends and has posted on its investor relations website, www.pginvestor.com, a full reconciliation of non-GAAP financial measures. Now I will turn the call over to P&G's Chief Financial Officer, Andre Schulten.

Good morning, everyone. Joining me on the call today is Shailesh Jejurikar, Chief Executive Officer, and John Chevalier, Senior Vice President, Investor Relations. I will start with an overview of results for the second quarter of fiscal 2026, and Shailesh will discuss strategy, innovation, and focus areas as we start calendar year 2026. I'll close with guidance for fiscal 2026, and then we'll take your questions. As we expected, second quarter top-line results heavily reflect underlying market trends and impacts from base period dynamics. As a reminder, the base period included trade and consumer pantry loading driven by port strikes and hurricanes in early October and the fear of additional port strikes in late December. The biggest impacts were on the baby, feminine, and family care sector and the fabric and home care sector. These base period impacts were concentrated in the U.S. market.

The business of the company grew organic sales nearly 3%, with almost all regions outside the U.S. growing or accelerating in the quarter. Bottom-line results followed the top line as we continue to prioritize full investment in the business. We anticipated this would be the softest quarter of the fiscal year, and we remain confident in stronger growth in the back half. So moving to the details, organic sales were in line with prior year. Volume was down one point, pricing up a point, and mix was flat for the quarter. Seven of 10 product categories held or grew organic sales. Hair care grew mid-single digits. Skin and personal care, personal health care, home care, and oral care were each up low single digits. Grooming and fabric care were each in line with year ago.

Baby care and family care were each down low singles, and family care was down approximately 10%, primarily due to the base period dynamics we described. As a side note, organic sales excluding family care were up 1% for the quarter. Seven of 10 regions grew organic sales. Focus markets were down 1%. Organic sales in North America were down 2%. Volume was down three points, including a roughly two-point headwind from the base period trade inventory impacts I mentioned. Price mix added a point of growth. European focus market organic sales were up 1%. Strong growth in France, Spain, and Italy, largely offset by a softer period in Germany. Greater China organic sales grew 3%, another quarter of growth in what remains a challenging consumer environment. Pampers and SK-II led the growth, each up mid-teens or more. Enterprise Markets grew mid-single digits for the quarter.

Latin America organic sales were up 8%, with solid growth across Mexico, Brazil, and the balance of smaller markets in the region. Organic sales in the Europe Enterprise Market region were up 6% versus prior year, and the Asia-Pacific, Middle East, Africa enterprise region grew 2%. Global market share was down 20 basis points. 25 of our top 50 category country combinations held or grew share for the quarter. On the bottom line, core earnings per share were $1.88, in line with prior year. On a currency-neutral basis, core EPS was $1.85. Core gross margin was down 50 basis points, and operating margin was down 70 basis points versus prior year. Strong productivity improvement of 270 basis points, with healthy reinvestment in innovation and demand creation. Currency-neutral operating margin was down 80 basis points.

Adjusted Free Cash Flow Productivity was 88%, and we returned $4.8 billion of cash to shareowners this quarter, $2.5 billion in dividends and $2.3 billion in share repurchases. In summary, we've now completed what we fully expected will be the softest quarter of the fiscal year. We have strong innovation and productivity plans for the back half of the year. We continue to invest in creating superior propositions for our consumers and retail partners, with relevant innovation, powerful brand campaigns across every touchpoint, and continuously improving in market execution across all channels and platforms. We're fully activated. It's working. So we move with confidence into half two of the fiscal year. And with that, I'll turn it over to Shailesh.

Thanks, Andre. Good morning, everyone. I want to start by underscoring the point Andre just made. We are confident the interventions and investments we are making now will improve our near-term performance. Strong innovations supported by sharper consumer communication and retail execution. We are already seeing strong results in parts of the business that have made these near-term interventions. Greater China baby care was one of the first categories to make a step change and continues to lead growth of the premium and super premium segments of the market behind consumer insight-driven innovation and brand communication. Chinese parents want only the best for their baby. Softness and comfort in addition to dryness. The China team created a product that delivers on this insight, from first seeing and touching the packaging to feeling the diaper on their baby. They leverage the Chinese history with silk.

The shiny, soft yet strong, luxurious material has been a status symbol for more than 2,000 years. Pampers Prestige is the only leading diaper brand that has real silk ingredients in the product, delivering the ultimate experience of skin comfort and protection. The shiny, soft-feel package conveys superiority at first touch. Reframing our superior premium line has driven Greater China baby care to double-digit organic sales growth over the past 18 months and increased share nearly three points. More recently, our Mexico fabric enhancers team has disrupted a sleepy category through deep consumer understanding. Mexican consumers describe the gold standard smell of clean as rich, tasty, fruity, and floral, like the scents from shampoos. Downy Intense leverages our internal perfume innovation expertise to create the new high-intensity perfume. The packaging highlights the intensity of fragrance blooming on the bottle like a flower.

Brand communication drives awareness of an experience of 24/7 smelling like freshly washed hair. In-store execution of impactful displays with stopping power is increasing trial. These deep consumer insights driving innovation and executed with sharper brand communication and retail execution has spurred Mexico fabric enhancer category growth and led Downy to double-digit organic sales growth and over two points of value share growth. Other examples where we've accelerated results include the Brazil hair care business, U.S. Old Spice, and U.S. liquid laundry detergents businesses. Most of these interventions are starting now in the U.S., the biggest, most impactful part of the business. We'll go deeper on these at the CAGNY Conference next month. While we work to improve our near-term results, we've also begun a longer-term reinvention of P&G.

Think of this as the next important phase of constructive disruption that will create and extend our competitive advantages in each element of our strategy. We remain fully committed to the integrated growth strategy that has enabled us to deliver significant growth and value creation over the better part of the past decade, and it will in the future. A portfolio of daily use products in categories where performance drives brand choice. In these categories, P&G is uniquely positioned to deliver irresistible superiority across product, package, communication, retail execution, and value. We will do this to drive market growth and create value for P&G and our retail partners. We will double down on productivity with multi-year visibility to fund capabilities, innovation, and demand creation, and to mitigate cost headwinds while delivering financial results at the levels you and we expect.

Constructive disruption to stay ahead of and to create emerging trends and opportunities in our fast-changing industry. We will disrupt ourselves. At the core of it all is our organization. Fully engaged, enabled, and excited to serve consumers and win in the marketplace. These strategies taken alone are just words that any company could say. The words alone have become a point of parity. P&G's point of difference, our competitive advantage, comes from outstanding integrated execution of these strategies across all activity systems in the company and from anticipating what is needed next. We've executed the strategy well for many years. Now we see the landscape around us changing faster than it's ever been in recent memory. Neither we nor our industry in aggregate have adapted as fast as needed. This shows in the growth trends of our categories.

Consumer media preferences and information collection are increasingly fragmented, with new media platforms including social media and retail media. Inflation across food, energy, health care, and many other areas of spending has taken a toll on consumers and how they assess value. This will continue to evolve. The retail landscape is changing. More concentration, but also brand proliferation. Retailers are becoming media platforms, and media platforms are becoming retailers. In summary, the consumer path to purchase is changing every day, is non-linear, and littered with millions of possible distractions. We expect an even more intense pace of change in the next three to five years. We will adjust to and leap ahead of these disruptions to invent the CPG company of the future. The way to break through consistently is to build the strongest brands in the industry.

P&G has the capabilities and unique opportunity to redefine the brand-building framework to deliver consumer-relevant superiority every day, every week, every month, putting the consumer at the center of everything we do. Leading the consumer-relevant brand-building and superiority at this pace can and will only be delivered by leveraging superior data, superior technology, and superior capabilities to create and extend competitive advantage with consumers and with retail partners. We define our strengths and opportunity here across three areas. First, we know how to build brands rooted in deep connections with consumers and our industry-leading innovation capability. We have an enormous wealth of consumer data and understanding, and we receive a continuous flow of new data every day. Our teams connect with consumers across more touchpoints than anyone in our industry: product research, shopper research, connected homes, ratings and reviews, social media posts, brand fan websites, and many more.

We mine for insights that lead to new product innovation, brand ideas, performance claims, marketing campaigns. Now we are building the consumer connectivity, the integrated data platforms, and the technologies that will enhance our team's ability to do this work better, faster, and even more consumer-centric than ever before. We have a unique set of innovation capabilities in our industry: substrate technologies, formulaic chemistry, devices, and now biology. We have years of experience integrating these capabilities to launch new platform technologies and innovations, and we see many more ways to bring combinations of these technologies to life in new consumer products. Tide evo is just one current example. Technologies like AI-enabled molecular discovery will enable faster and more powerful integration of innovation capabilities for faster growth.

The second and related opportunity is to create a deeper, holistic connection with consumers to build brand relationships with them in the new media reality. Media fragmentation and emergence of new platforms creates an opportunity for brand builders who can best integrate across touchpoints. AI and GenAI capability help our teams to

discover consumer-relevant insights at every step of the consumer path to purchase, grounded in a unifying brand idea. We are creating the individual touchpoint experiences for each consumer at a time. These ideas are activated in claims, demonstrations, and visuals that communicate the performance and value of the brand across connected and broadcast TV, online video, social media, e-commerce sites, and in stores. Deep insights translated into a compelling brand idea repeated wherever consumers engage, making the brand easy to remember, reinforcing superior performance that is worth it for the price paid.

The third opportunity is integration with retail partners across the full supply chain and merchandising activity system. Again, the consumer understanding and brand-building capabilities we have from initial brand impulse to purchase transaction to in-home consumption are valuable assets. Integrating these with each retailer's category strategy and business model will enable our brands to create value across all retail formats. This includes activation of our brands in retail media to convey our superiority and value messages close to point of consumer purchase decision. Our supply chain capability is already a leader in the industry. Supply Chain 3.0 has driven a more complete system connection from purchase signal back through inventory systems to our production planning and material ordering to ensure consumers find the product they want each time they shop. We are well on our way in this journey across capabilities, data, and technology.

We are freeing up capacity and capabilities with the organization redesign we announced as part of the restructuring in June. We have built a structured data lake stocked with petabytes of relevant data. We have built data platforms, AI capabilities, programmatic shelf tools, and media creation and evaluation systems. We have supply chain platforms that can run autonomously, reacting to retail demand signals, consumer innovation needs, or productivity opportunities faster than ever before. The next step is to connect the dots, to integrate the pieces from identifying consumer friction point to product idea to product design to supply to creative concept to purchase transaction to usage in home to post-use evaluation. We will close the loop, and we believe this will create a different S-curve for our future growth and value creation centered around our consumer.

We are doing many things right in how we are innovating, operating, and building brands today, and I'm confident in the near-term progress we are seeing. We know the opportunities ahead of us are even bigger, and we will capture them with conviction and discipline. It took years to build the underlying platforms and capabilities, and it will take some time to fully integrate and activate these assets across the company. We know what we need to do, and we are excited by the opportunities ahead. In summary, we are confident in the short-term delivery and excited about the mid to long term as we leverage our strengths and unique capabilities to set us apart from the industry. We are inventing the CPG company of the future. We'll expand on these thoughts with some examples at CAGNY and even more as we get to Investor Day later this year.

With that, I'll hand it over to Andre to cover the guidance update.

Thank you, Shailesh. It's been a challenging start to the fiscal year with softer consumer markets, aggressive competition, and a dynamic geopolitical landscape. We expect stronger results in the second half, which enables us to maintain fiscal year 2026 guidance ranges across organic sales, core EPS, and adjusted free cash flow productivity. The growth rates embedded in our near-term guidance should return us to the lower half of our long-term growth algorithm as we exit fiscal 2026 and head into fiscal 2027. For fiscal 2026, we continue to expect organic sales growth of in line to plus 4%. Global market growth for our portfolio footprint is around 2% on a value basis at the center of our guidance range. We're seeing progress in most regions, and we expect stronger growth in the U.S. as interventions take hold.

As a reminder, this guidance includes 30 to 50 basis points of headwind from product and market exits that are part of our restructuring work. Our bottom-line outlook is for core EPS growth of inline to plus 4% versus prior year. This equates to a range of $683-$709 per share. This guidance includes commodity costs roughly in line with prior year and a foreign exchange tailwind of approximately $200 million after tax. Taken together, no change versus prior guidance. Our fiscal 2026 outlook continues to expect approximately $500 million before tax and higher costs from tariffs. Below the operating line, we continue to expect modestly higher interest expense versus last fiscal year and a core effective tax rate in the range of 20%-21% for fiscal 2026, combined a $250 million after-tax headwind to earnings growth.

We continue to forecast adjusted free cash flow productivity in the range of 85%-90% for the year, and this includes an increase in capital spending as we add capacity in several categories that we incur the cash costs from the restructuring work. We expect to pay around $10 billion in dividends and to repurchase approximately $5 billion in common stock, combined a plan to return roughly $15 billion of cash to share owners in fiscal 2026. This outlook is based on current market growth rate estimates, commodity prices, and foreign exchange rates. Significant additional currency weakness, commodity or other cost increases, geopolitical disruption, major supply chain disruptions, or store closures are not anticipated within the guidance ranges. With that, I'll hand it back to Shailesh for a few closing thoughts.

We continue to believe the best path to sustainable balanced growth is to double down on the strategy. Stronger integrated execution to delight consumers with superior products at a superior value. Challenging markets like the ones we compete in today are an opportunity for P&G to step out from the back and lead. We're focused on leveraging the industry's best insights, assets, capabilities, and people to return to the levels of growth and market leadership that we and you expect. With that, we'll be happy to take your questions.

If you have a question, please press star followed by one on your phone. If your question has been answered or you would like to withdraw your question, press star followed by two. Your first question comes from the line of Lauren Lieberman of Barclays. Please go ahead. Great.

Two kind of clear themes in the remarks that I wanted to ask about. Andre first, kind of what gives you confidence in the near-term acceleration that you mentioned a couple of times? And to what degree is that about kind of comparisons and base period dynamics versus real fundamental improvement and acceleration? And then Shailesh, I know we'll get a lot more from you at CAGNY, but what gets you excited about this longer-term "reinvention" of P&G? It was a notable choice of words in the press release and then also in the prepared remarks.Thanks.

Good morning, Lauren. Thanks for the questions. So let me start with the acceleration. I think the first positive element of quarter two results is the strength of the business outside of the U.S..

If you look at Latin America, 8% growth. Europe in aggregate growing 3%. China growing 3% on top of 5% growth last quarter. Asia, Middle East, Africa is up 2%, and if you exclude the restructuring exits, it would be up 4%. So there's real underlying acceleration in the business outside of the U.S., and that is grounded in interventions that we've made in terms of innovation, in terms of commercial strategies, and in terms of doubling down on the precision and quality of execution in those markets, with Latin America really being ahead of the game here. And that's proof for us that the core strategies we're implementing, I think, are showing the results that we want to see. The U.S. underlying results, we believe, will improve because we don't have the base period headwinds that we saw in quarter two.

As you point out, I think that's part of the acceleration we expect in half two versus quarter two, not having inventory headwinds to the degree that we saw in quarter two. But the main element here, I think, is the fundamental execution of the same interventions we made outside of the U.S. earlier. If you recall, the U.S. slowdown was really a little bit delayed versus the balance of the markets. So we started in the rest of the world earlier with the innovation, commercial interventions, and execution, but that same playbook is being executed in the U.S. Early indications where we have done this, for example, the Tide boosted launch that is now in full distribution as of December, we're seeing results that are giving us confidence.

The innovation we're launching on Olay just now on the jars with a new campaign and the launch of treatments at the same time with a new architecture gives us confidence. The innovation we have on baby care, first wave executed now, second wave coming later, Tide evo coming in the back half of the year. So there's a wealth of innovation we're launching. We've clearly identified with our North America leadership the opportunity in sharper execution across all retail channels, and the team is committed and is turning that into execution changes. And then the simple opportunity to leverage the strength of our brands by staying fully invested across the second half in media with even better execution. So all of those elements that we executed outside the U.S. that are showing progress, we feel will work in the U.S..

And if we don't see any one-timers anymore in terms of base period headwinds, that will translate into stronger growth. And our objective clearly is to leave the year with share growth in the U.S. Shailesh, you take the same part.

Yeah, I will. Thanks, Lauren. So first, what excites me is plenty of growth opportunities. We see that everywhere, but it's not going to happen on its own. It will require us to create our own tailwinds, be it playing in a growth segment and driving it like personal care or playing in a segment which wasn't growing like Tide with Evo and then having that category grow high singles. So we see growth, or you take China baby care another example where you take and put the odds of growth with the lowest birth rates and all of that, and we find a way to grow there.

So that's one thing that excites me. The second one is a unique once-in-a-generation opportunity to leverage the shifts in the landscape and our unique strengths and capabilities to set ourselves apart. The media landscape is changing. The retailer landscape is changing. There is a tremendous amount of technology, both from a point of what is applicable using AI, enabling a lot of other things, but even fundamentally our own product and packaging technologies, and then consumer preference and demographics, which are evolving. Then you take those and take our strengths and capabilities, brands with large consumer base. If you have a large user base and you're really delivering amazing products, you probably have the biggest fan club already right off the bat. Consumer understanding and consumer data, we have so much data that we have put in.

We can get an answer even before getting started, and that flow just continues, and we are further strengthening that. Take the media spend leverage and take the different places we could be using it. That is another huge opportunity. Our R&D spending and capability across multiple areas of technology from formulaic chemistry, substrates, devices, biology, that just enables us to innovate much more broadly. You take the China baby care. It's one thing to get the insight, another thing to find a way to put silk in the product, another thing to be able to communicate it to consumer, bring it into packaging, bring it to life with user-generated content. So it's the ability to bring all of that together and the technology platforms and applications we've been building. And Andre talked a bit about this.

I would say we have been building a lot, and I would say the future is here. It's just a little uneven. So our job is to integrate and bring it all together.

Your next question will come from the line of Steve Powers with Deutsche Bank. Please go ahead.

Great. Thank you very much and good morning. I'm going to ask a question that kind of follows the same structure as Lauren's question. So the first one on the second half and improvements, if we think about things by category segment versus by geography, I guess maybe a little bit more detail on where you expect progress and sequential acceleration to manifest most clearly. It sounds like laundry and baby and perhaps skincare from what you said, Andre, but maybe just you could elaborate a bit more from that perspective.

Then Shailesh, as you think about all those different pieces of operational enhancement and reinvention initiatives, how do you think about the path and timeline from here for the company to put all of them together and create those own tailwinds and win in the marketplace across the portfolio with consistency? How long does that take in your mind?

Morning, Steve. If I look across the businesses, the innovation interventions, the commercial interventions, the execution focus is consistently applied across every part of the portfolio. I will tell you the base period effects are probably a strong help when you look at family care, baby care, and even fem care. They were most heavily impacted in the first half of the year. Family care, for example, we see strong growth in January, even turning into share growth now.

We expect similar dynamics to happen across baby and fem. Baby at a global level is actually growing share, so has returned to share growth in the most recent reading. So the momentum is there. We continue to work on the mid-tier proposition. You recall we had innovated on the top tier that continues to work well, Swaddlers, Cruisers 360. We've made the innovation interventions on Luvs a year ago. That's working. On Baby-Dry, we have a two-phased approach. Phase one is executed. Phase two is coming later. So that's still work to be done. On laundry and fabric enhancers, we have very strong innovation, Tide Boost I mentioned before, the biggest laundry liquid upgrade in 20 years for consumers, and that is taking hold and working. And we're preparing for the Tide evo launch. We have strong innovation across fabric enhancers as well.

As you know, that's still a huge opportunity in terms of household penetration. So communication effectiveness and copy quality is improving. In beauty, in aggregate, beauty is growing 4%. We have an opportunity to strengthen growth in skincare in the U.S., making strong progress on SK-II outside of the U.S., on Olay outside of the U.S. I think the new launch of Olay that is just coming out with strong retailer support, I think will accelerate that business. Personal care has momentum and will continue momentum in the U.S. and globally. So I can continue to go down the list, but I think I've given you enough depth to say this is really across the portfolio. It's the same idea, double down on the consumer, double down on the execution, double down on the quality of the brand campaign.

And I think that's where Shailesh is putting his focus, if I can speak for him. He's really doubling down in every review on the quality of the execution, the quality of the brand campaign, the quality of the architecture thinking. And it's stimulating thought. It's stimulating quality of execution. And I think that gives us confidence from a geographic standpoint, as we talked earlier to Lauren's question, but also from a category standpoint.

Well, thanks, Andre. And I'll just bridge Steve from what Andre said to what I'm going to say. But some of it will be sequential just simply because in the U.S., also when we make the interventions, we are extremely deliberate about making sure those interventions also drive category growth. So that's also why some of this has to happen with big innovations.

But switching to your question, so I think a lot of the way to think about the future is we have, in many cases, already built platforms. Take the core data lake that I talked about earlier. I mean, that did not happen overnight, cannot happen overnight, requires data capabilities, requires partnerships, but also importantly, requires internal cultural change. For people to work the data and systems in a certain way is not a change that you can just do overnight. Even if you have the technology solution, very often the culture change needs to go along with it. And so a lot of that work has happened or is happening. The timeline, if you asked, as you specifically did ask, is I think by the time we really get the future evenly distributed, I think we're talking 12 to 18 months.

But it is not one which is a line of demarcation. So you will see parts of the business and certain businesses better equipped to take on all aspects of the transformation. So some businesses may be ahead of others, some regions may get ahead of others. But the simple answer to your question is really, I think, to get the future evenly distributed will be 12 to 18 months.

The next question will come from the line of Chris Carey with Wells Fargo. Please go ahead.

Hi everyone. I wanted to ask about investment levels. P&G has recently announced a restructuring program, and you're going through some initiatives today, new media platforms, supply chain integration with an evolving retail landscape. Obviously, there's an expectation for improvement in sales growth, rebalancing of this, I guess, top line and move toward algorithm over time.

Can you give us a sense of the sort of cost of this progress, I suppose, and kind of the balance between the restructuring and some of the savings that that's going to allow for you relative to what you feel like is going to be needed potentially, especially if you don't see that acceleration that you're going to be looking for in the coming months if you really want to stimulate the top line for this business over the next 12-18 months? Thanks so much.

Hey, Chris, let me take a crack at this. The first part of the answer is many of the investments have been made over the last decade. If you think about the amount of money it takes to build a consistent global ERP platform, the data lake, the data governance structure, data engineering, all of that has been done.

So that was part of the results that we delivered over the past, I would say, five to 10 years. The investment to activate the technology, specifically around the innovation capabilities, the media capabilities, won't be significant. It's an investment in scaling, but the underlying technology, the underlying data, that heavy investment is already done. So in that sense, I don't expect major capital or expense investments. On the supply chain side, you see us build capacity. And as we build capacity, that capacity is built in a way that it leverages automation, digitization, both on the manufacturing side and on the warehouse side. So the elevated investment level in terms of capital is really related to building capacity, building capacity in a different way, but not fundamentally more expensive. So I don't expect, again, on the capital side, a significant shift.

The restructuring we have announced in June, the two-year program, I think will take us through the majority of the org changes and portfolio changes that we need to make. From there on out, if this works the way we want to, it will basically allow us to grow without incremental investments in organization or people. So if you think about it, the objective is to grow productivity, sales per head disproportionately once these capabilities are implemented. But we don't think it requires another wave of significant restructuring beyond what we typically have as part of our core earnings. So I wouldn't look at a cliff of investment that comes with this.

The second part of your question on return to algorithm, I would say let us get through the next two quarters and focus on acceleration, and then we'll talk about where we see the next year and how close to algorithm we come once we have that reality under our belt.

The next question will come from Dara Mohsenian of Morgan Stanley. Please go ahead.

Hey, good morning. So Shailesh, I just wanted to dial down a bit more into the U.S. market. There's always an opportunity under a new CEO to refocus the organization and tweak areas of emphasis. Obviously, there's broad changes in the retailer environment, as you mentioned, AI technology, consumer landscape, etc., etc. And also, we're coming off a very difficult category growth environment in the U.S. in calendar 2025.

So just as you look going forward, what are the most important priorities for the organization in terms of driving better execution, reaccelerating that organic sales growth, and specifically P&G's part of driving category growth? And part of the question is I'd like to better understand what's changing in terms of areas of emphasis of the strategy plans versus more where you're doubling down on execution and existing plans?

Sure. Thanks, Dara. Few areas. So I think, as I said, I think if we get the elements of a plan right, I think there is opportunity to grow the market. So I think that is doable. What are some of the changes, as Andre talked about, the interventions short to mid-term that we are looking at and which also bleed into the long term? So it isn't just one separate short and long-term intervention.

One is the media landscape has changed very dramatically over the last few years. I think probably driven somewhat by COVID, habits, a bunch of other things. The way people consume media and content has changed dramatically. Adjusting our brand building plans to fully reflect that change and leverage it is the first big intervention we are focused on as we review plans, including in the U.S. The second one linked to the retail landscape, there are a couple. But the first one is linked to when you see which channels are growing, where the growth is coming, we need to adjust the kind of innovation we do. The way we are calling it is stronger core, bigger more. Because by definition, what we are finding is just given how challenging it is to get awareness, how important it is for the big items to be there.

For instance, even on e-commerce where you can list everything, it's really the first screen or two that matters, and so having the item which has the velocity is extremely important, and so the way to think about it is a stronger core, for example, is the Tide liquid relaunch. You have an amazing user base. You give them a delightful product. They continue using it, use more of it, and attract other people to come use it as well. The bigger more, a good example is the launch of something like Tide evo, which is transformational, so you are going to get consumer attention and engagement, so we're changing the innovation to reflect that both from a point of view of how the media is being consumed, but also how the retail landscape is playing out. The third area of change is, of course, very deliberate on consumer value.

And particularly in a market like the U.S., a lot of it is about strengthening our proposition. Again, Tide is a great example of it, but we are going to have that pretty much across every category where we significantly improve the value by significantly improving the product performance so that the consumer notices it and feels the value. So one of the areas that we're looking at across categories is significant strengthening of the propositions. And in many of these cases, that do not come with a change in price. So we will be significantly strengthening value. So if I were to just summarize what I just said, it would be adjust to the new media landscape with how we do our brand campaigns, adjust how we innovate with much more emphasis on a strong core and a bigger more, and then ensure we're delivering really good consumer value.

The next question will come from Robert Ottenstein at Evercore ISI. Please go ahead.

Great. Thank you very much, and I think you've kind of hinted at this, but let's just talk about the U.S. and Amazon. Our data is showing that it's driving a disproportionate amount of the growth in your categories, depending on the category anywhere from 60%-80% or so. How specifically is that impacting your media efficiency and competitive dynamics against smaller brands? What do you need to do differently? And perhaps, do you have any particular learnings from China that are relevant here? Thank you.

Hey, Robert. A couple of points that I think Shailesh hinted towards.

I think having the core brand as strong as possible by improving the performance, improving the claims, the e-content, all of that, I think is the best and most urgent thing to do across the entire portfolio. So when it shows up on the landing page, it shows up as strong as possible. I think that's number one. I think there's an opportunity specifically if you look at online businesses. The willingness of consumers to actually go into higher-priced items is still very, very strongly developed. If you think about categories like haircare, if you think about categories like skincare, where small brands tend to play is in the upper end of the spectrum from a price-per-usage component. I think that's an opportunity for us to innovate, which is stronger core and a bigger more. And the more, especially on online, I think can be premium priced.

So that's where you see innovation happening. And in general, the last thing I'll leave you with is taking smaller brands and looking at some of the ideas that these creators are bringing. I think is good inspiration. So we're looking at some of these brands and saying, "that could be an interesting idea maybe on some of our core business," or it could be an interesting idea to replicate as a line extension. There's nothing unique if you think about the ability that the ecosystem of small brands can bring, not technology-wise, certainly not from a marketing scale perspective, certainly not from a supply chain perspective. But the creative stage is something interesting for us to look at.

I just add a couple of points, Andre, on this to what you said, which is firstly, at a broad strategic priority level, we are very, very deliberate about ensuring we win in the fast-growing segments, which may be channels or segments of a market. What is exciting to the point you made, Robert, about the e-commerce growth at a variety of retailers and a variety of countries is very often, if we can channel that right, it can dramatically grow the market size and category, and if you want to take a stark example and move away from the U.S. for a second, we go to India where our portfolio is slightly different and has been evolving differently. E-commerce is growing probably at 10 times the pace almost of offline, and our share is about 1.8x of our offline business.

So we are very deliberate about that, whether it's the U.S. or India or any other market, to make sure that happens. The drivers, as Andre pointed out, of winning there need certain things which we are making sure we have across the board, which includes content, which includes the item specificity, and making sure those are strong and growing and playing with the right portfolio. So those all become very critical elements, whether it's Amazon and U.S. or any other e-com player in the U.S. or outside the world.

The next question will come from the line of Peter Galbo with Bank of America. Please go ahead.

Hey, guys. Good morning. Thanks for taking the question. And I'm now happy to be contributing very much to the baby care comps in the Galbo household.

So I wanted to ask just regarding, Andre, your comments around returning to kind of the lower half of algorithm and the back half on the near term. Maybe a bit of clarification there. I think at one point in the prepared remarks, you talked about your categories growing at maybe 2%. Then there was another comment about if we took out the lap, you would have actually seen organic sales at 3%. So just maybe you can help clarify a bit on what you were trying to say with that comment as I've gotten some inbound from folks on that. Thanks very much, guys.

Hey, Peter. Glad to welcome you to the Diapering household community. So if you look at our global categories, we see growth around 2% in terms of value. Enterprise Markets are growing at about mid-single digits.

China is still negative by about a point. Europe flat in volume, about 1% in value. And the most recent reading in the U.S., all outlet read, so our data would indicate about 1%-2% value growth. If you look specifically at the OND quarter, there might be a point of inventory within those numbers. So if you want to be optimistic, you could say the U.S. structurally could be growing at 2 to 3 points. But we have to see where that goes. From our point of view, the actual results, we've delivered 3% growth outside of the U.S. So that's roughly in line with market growth outside of the U.S. And we have delivered -2% in the U.S., which is below the market. And a good part of that is the inventory effects.

But there is a component of reduced share. So I don't want to gloss over the fact that we have work to do to recover share. Partially, that's already in progress. I talked about family care. We're making progress on laundry. But the recovery in the second half will include both the base period effect moving out of the market and us recovering share. So our objective is really to leave the fiscal year with share momentum out in the U.S. and at a global level.

The next question will come from Kevin Grundy of BNP Paribas. Please go ahead.

Great. Thanks. Good morning, everyone. Shailesh, I wanted to take a step back and ask for your assessment overall on the portfolio from a strategy perspective. So it's been over a decade since P&G completed its portfolio review.

Success, as you noted, didn't come right away, but ultimately did and set the company on a very strong path for growth. But now, as we talked about on this call, the company finds itself in more of a transitional sort of phase of reinvention, if you will, as growth has slowed. So with that as context, I'd like your view here on whether you are generally pleased with the current portfolio. Is Procter still in the right segments within big total addressable markets, attractive returns on capital, and stronger growth? Or do you see it possible that certain businesses may make less sense today in P&G's portfolio than they may have in years past? So your thoughts there would be appreciated. Thank you.

Thanks, Kevin. I split it into a few parts.

So first is I think we are clear that we play in daily use categories where performance matters. So I think we feel very good about that choice. We feel very good about that choice because it's extremely well integrated with the total strategy. That's where superiority becomes critical. The whole model works well when we are in categories where daily use categories where performance matters. So I think that is one part of it. Second part of it is what we call the day-one look.

If we were starting our company today, we would look at our portfolio and say, "Okay, are we in the right places?" That has been really the genesis or driver of the restructuring that we talked about six months back, where we said we need to get out of certain parts of the business because simply them being a drag or not where we saw future growth. So there's another part of it, which is just disciplined look, a continuous review of which are the right segments, and are we playing adequately in higher growth segments or not. There's a third element of it, which is when we look at categories, are we playing in the right segments? And something Andre just talked about, which is if you look at e-com, you see which category, what segments are growing, and are we present enough in some of those.

If you look at social commerce in some categories and see are we well represented in all segments, and we actually find a lot of opportunity at some of the higher price points in some of the categories in things like social commerce. So that's another aspect of the portfolio that we continue to strengthen. And the final point I would make is we continue to look at where we can build greater strength. And we've always talked about the fact that health and beauty are two areas where we find we have still opportunity to build a stronger presence, and we continue to look at opportunities which come our way there.

The next question will come from the line of Peter Grom with UBS. Please go ahead.

Yeah. Thank you, Andre. And good morning, everyone. So I guess I just wanted to follow up on the U.S.

I guess you sound confident in your ability to see performance improve. But I guess I was trying to just pin down what you're expecting in terms of category growth for the back half of the year. I wasn't sure in your response to Peter's question around 1%-2% growth, whether that's kind of the right runway we should expect moving forward or whether the guidance expects to get back to that 2%-3%. So maybe if you could just elaborate on that, that would be helpful. Then I guess just related, at CAGNY last year, there was a lot of discussion around inventory destocking. So just any thoughts or comments on what investors should expect as we anniversary those impacts? Thanks.

Hey, Peter. Yeah, thanks for the push on clarifying U.S. category growth.

Our base expectation is 2% category growth in the back half. That's what we know, and that's what we're planning on. From an inventory standpoint, hard to predict. The only thing I'll leave you with is I would not expect any significant inventory built in the second half. That's not part of our plan. We expect some level of inventory efficiency to be driven across retailers like they always do. Some of our retail partners are finishing up supply chain interventions, and that will probably lead to some efficiency in terms of inventory levels. So I would tell you a slight headwind from inventory is probably adequate to assume on a market base that has about 2% of value growth.

The next question will come from Filippo Falorni of Citi. Please go ahead.

Hi. Good morning, everyone. I wanted to shift maybe to margins.

For the second half of the year, is it the right expectation to think that we should see an improving margin trajectory as well, considering the assumed improvement that you embedded in the U.S. market, which is your highest margin business, and given the commodity outlook looks a little bit more favorable in your guidance? And then below the gross margin line, Shailesh, you mentioned a lot about the interventions that you're planning, including the U.S. business. Can you help us quantify the sizing of those interventions? Where would they show up, whether it's with more advertising, more R&D, more promotional investment? Any help like sizing and quantifying those impacts will be helpful. Thank you.

Procter & Gamble (PG) Q2 2026 Earnings Call Transcript

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