Colgate Raises 2026 Core EPS Growth Outlook to 5%-7% After Organic Sales Accelerate 3.6%
Key Facts
Colgate-Palmolive raised its 2026 outlook for growth in adjusted earnings per share to 5%-7%, after reporting third-quarter organic sales growth of 3.6%, driven by volume and pricing increases. Chief Executive Noel Wallace said organic sales growth momentum accelerated during the quarter, with a balance between volume and pricing despite continued macroeconomic volatility. The company said diluted earnings per share under generally accepted accounting principles rose 3% to $0.94, while core earnings per share, a non-GAAP measure, increased 7% to $0.97. It also raised its outlook for gross profit margin, under both measures, to show a year-over-year increase. Management attributed the guidance revision to year-to-date strength and confidence in its productivity and pricing initiatives.
Organic sales growth comprised a 1.7% increase in volume, a 2.0% rise in net selling prices and a 1.0% positive foreign-exchange impact. But a decline in private-label pet food sales reduced growth by 20 basis points. Wallace said the company recorded its fourth consecutive quarter of sequential improvement in global volume growth, while pricing remained strong in the third quarter. After the second quarter, Wallace had pointed to improved global organic volume growth for the third consecutive quarter, making the third quarter an extension of the improvement trend described by management. In July, organic sales grew 2.4% and net sales 4.9%, while core earnings per share were $0.99.
Regional performance varied in the third quarter, with organic sales growth of 6.0% in Latin America, 4.6% in Asia-Pacific and 2.7% in Europe, the Middle East and Africa. By contrast, organic sales in North America fell 1.6%. The results show regional divergence, with the first three markets posting growth while sales declined in North America. In Europe, the Middle East and Africa, performance was positive overall, but the company reported a decline in organic sales in the Middle East within the region's results. Overall growth therefore came alongside geographic divergence, with strength in markets outside North America and weakness in the latter region.
The company narrowed its fiscal 2026 net sales growth outlook to 4%-5%, compared with its previous range of 2%-6%. It now also expects organic sales growth to be close to the performance recorded in the first nine months of the year, instead of the previous range of 1%-4%. Management raised its outlook for core earnings per share growth to 5%-7%. It also now expects gross profit margin to increase year over year under both GAAP and core measures. Management said year-to-date strength and confidence in its productivity and pricing initiatives supported the guidance update.
Net cash provided by operations totaled $2,913 million in the first nine months of 2026. In the second quarter, the company had maintained its full-year outlook for net sales growth at 2%-6% and organic sales growth at 1%-4%, before narrowing its net sales range and updating its organic growth outlook after the third-quarter results. The third-quarter earnings conference call was held on October 30, 2026, at 8:30 a.m. Eastern time, and the company said it was being held via webcast. In stock trading, EL7 data showed Colgate-Palmolive shares closing at $95.29 on October 30. The stock closed at $93.16 on October 29, $91.69 on October 28, $92.17 on October 27 and $93.10 on October 26.