By Katherine Hamilton

Colgate-Palmolive posted a higher profit in the first quarter but lowered 2025 earnings guidance due to tariffs.

The maker of Ajax and Softsoap on Friday posted a profit of $690 million, or 85 cents a share, in the three months ended March 31, compared with $683 million, or 83 cents a share, a year earlier.

Revenue fell 3% to $4.91 billion. Analysts surveyed by FactSet forecast revenue of $4.87 billion.

The New York consumer-products maker lowered its full-year guidance based on current spot rates and an estimated impact from tariffs, it said. It now expects earnings to be in the low-single digits. Sales are anticipated to be up in the low-single digits, with a smaller impact from foreign exchange than previously expected, the company said.

Colgate-Palmolive had said in January it expected earnings per share to have mid-single-digit growth and sales to be flat with the prior year.

"As we look ahead, uncertainty and volatility in global markets, including the impact of tariffs, remain challenging," Chief Executive Noel Wallace said.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

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By Katherine Hamilton

Colgate-Palmolive executives said consumers have been buying less toothpaste and soap as they brace for economic uncertainty, causing the company to lower its full-year earnings estimate.

"Uncertainty creates a pensive and anxious consumer," Chief Executive Noel Wallace said during a Friday call. "You see consumers destock their pantries and not necessarily buy that extra toothpaste tube or that extra body wash."

The maker of Ajax and Softsoap lowered its full-year guidance based on the estimated cost of tariffs, which it expects to be around $200 million for the year. It now projects earnings will increase in the low-single digits, compared with previous guidance in January of mid-single-digit growth.

The New York consumer-products maker was already expecting somewhat lower demand in 2025 following high rates of inflation, Wallace said. But in February, in-store traffic and sales volume in North America dropped more sharply than expected as the stock market declined.

Slower demand will likely continue through the year, Wallace said, but he believes it will stabilize and ultimately recover. April numbers showed some signs of improvement, he said.

"We've seen the categories soften a bit in terms of consumption, but ultimately they're everyday-use categories," he said. "They will come back."

Colgate-Palmolive's guidance doesn't account for tariffs that have been paused, Wallace said. Organic sales are now expected to grow 2% to 4%, down from the prior range of 3% to 5%. Gross profit margin is set to be roughly flat as a percentage of sales, while it was previously guided to be flat or slightly up.

Management said it is planning for a range of scenarios and trying to create some flexibility in case demand doesn't stabilize as it's anticipating, but it added that there are still a lot of unknowns about how tariffs will be implemented.

"It is really not possible to predict this through the end of the year," Chief Financial Officer Stanley Sutula said.

First-quarter profit was $690 million, or 85 cents a share, compared with $683 million, or 83 cents a share, a year earlier. Stripping out one-time items, adjusted earnings per share were 91 cents, ahead of the 86 cents projected by Wall Street.

Revenue fell 3% to $4.91 billion. Analysts surveyed by FactSet forecast revenue of $4.87 billion.

Europe was the only region where Colgate-Palmolive said it saw sales growth in the quarter, up 2.5%. Latin America and Asia Pacific were down 8.7% and 5%, respectively, while North America sales dropped 3.6%. The company's Hill's products outperformed the rest of its consumer offerings, with sales rising 1.5% for those products compared with a 4.3% decline across the other goods.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

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April 25, 2025 10:06 ET (14:06 GMT)

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