Kimberly-Clark reported adjusted earnings per share of $1.93 for the first quarter of 2025, surpassing expectations, while revenue fell short due to currency impacts and divestitures.
Kimberly-Clark, a prominent global provider of essential consumer tissue and personal care products, issued its first-quarter 2025 earnings report on April 22. The company achieved a Non-GAAP EPS of $1.93, exceeding the forecast of $1.90. However, its revenue, calculated as $4.84 billion (GAAP), did not meet the anticipated $4.89 billion. This revenue gap was largely due to unfavorable currency translation and divestiture activities. Despite these challenges, the quarter reflected effective cost management and strategic initiatives, presenting a complex but manageable scenario for the company.
A comparison of key metrics revealed that the Non-GAAP EPS was $1.93 against an estimate of $1.90 and $2.01 in the prior year, marking a 4.0% year-over-year decline. Revenue (GAAP) stood at $4.84 billion compared to the forecasted $4.9 billion and $5.15 billion in the previous year, showing a 6.0% year-over-year decrease. The Non-GAAP gross margin slightly reduced to 36.9%, down 0.2 percentage points from the previous year. Net income (GAAP) was reported at $567 million, a 12.4% decrease from the previous year’s $647 million.
Kimberly-Clark is known for brands such as Huggies, Kleenex, and Kotex, and operates globally in essential consumer categories. The company’s strategic efforts have been focused on optimizing the supply chain to boost operational efficiency and control costs. Sustainability is also a crucial part of its strategy, with goals to reduce the environmental impact of its products. Recent acquisitions, like Thinx Inc., underscore the company’s interest in innovative product development to expand into modern product categories.
In terms of quarterly performance, Kimberly-Clark’s key achievement was surpassing its EPS forecast by reporting $1.93 (Non-GAAP) versus an expected $1.90. Effective cost management and tax benefits largely supported this positive surprise. The adjusted gross margin slightly declined, however, to 36.9%, down by 20 basis points from the previous year.
Revenue declined by 6.0% year-over-year to $4.84 billion (GAAP), falling short of estimates by $52 million. This shortfall was attributed to currency impacts and structural changes from divestitures, such as the exit from the private label diaper business, which affected organic sales by 1.6%. Regionally, North American sales decreased by 3.9%, and the International Personal Care segment faced an 8.9% decline, influenced by negative currency effects. Nonetheless, the company made significant operational improvements due to its efficiency-focused transformation initiatives.
Looking ahead, Kimberly-Clark has modified its 2025 outlook, expecting a flat to modest increase in adjusted operating profit and EPS on a constant-currency basis. This cautious perspective takes into account ongoing cost pressures, geopolitical factors, and moderated economic forecasts. Investors should monitor the company’s execution of strategic initiatives, particularly supply chain optimization and investment in product innovation. The company’s ability to leverage its brand strength and navigate global market conditions will be vital to shaping its financial performance in the upcoming quarters.
Revenue and net income are reported using U.S. generally accepted accounting principles (GAAP) unless noted otherwise.
