$CLX · CLOROX CO /DE/
Clorox reported Q1 FY2027 results with net sales of $1.905B (+33% YoY), GAAP EPS of $1.39, and adjusted EPS of $1.55. The GOJO acquisition contributed ~15 points to sales growth, while organic sales rose 18% primarily from lapping the prior-year ERP transition inventory drawdown. Gross margin fell 130 bps to 40.4% on higher commodity and logistics costs. Full-year FY2027 guidance was maintained for sales (+13–14%) and adjusted EPS ($5.70–$6.00), but management now expects adjusted EPS near the low end and cut the gross margin outlook to ~41.5%.
- Net sales rose 33% to $1.905B, with organic sales up 18% driven by lapping the prior-year ERP inventory drawdown.
- GAAP diluted EPS of $1.39 vs. $0.65 a year ago; adjusted EPS of $1.55 vs. $0.85, an 82% increase.
- Gross margin contracted 130 bps to 40.4%, pressured by higher commodity costs and manufacturing/logistics costs.
- FY2027 adjusted EPS outlook maintained at $5.70–$6.00 but expected closer to the low end; gross margin outlook cut to ~41.5%.
- GOJO acquisition contributed ~15 points to net sales growth; Health and Wellness segment sales surged 62%.
Extended-hours trading shows CLX at $91.95, up +2.28% vs. the $89.90 regular close. The market appears to be rewarding the strong Q1 beat and maintained full-year guidance despite the margin compression and low-end EPS bias.
Clorox's Q1 beat is tempered by a margin outlook cut and low-end EPS guidance, signaling that post-acquisition integration benefits are being offset by persistent inflationary headwinds.
Clorox's 33% headline growth is heavily acquisition-driven; organic growth of 18% reflects a one-time ERP lap benefit. The gross margin compression from commodity inflation mirrors broader consumer staples sector pressures, though Clorox's pricing power and cost-savings execution provide offset.
GOJO integration risks include B2B operating model adaptation, customer concentration among distributors and GPOs, FDA regulatory exposure for OTC/cosmetic products, and potential impairment charges on acquired intangibles. Higher inflationary input cost pressures are flagged as a headwind to the updated gross margin outlook.