Consumer products giant Clorox (NYSE: CLX) met Wall Street’s revenue expectations in Q1 CY2026, but sales were flat year on year at $1.67 billion. Its non-GAAP profit of $1.64 per share was 6.1% above analysts’ consensus estimates.
Is now the time to buy CLX? Find out in our full research report (it’s free for active Edge members).
Clorox (CLX) Q1 CY2026 Highlights:
- Revenue: $1.67 billion vs analyst estimates of $1.67 billion (flat year on year, in line)
- Adjusted EPS: $1.64 vs analyst estimates of $1.55 (6.1% beat)
- Adjusted EBITDA: $352.8 million vs analyst estimates of $325.9 million (21.1% margin, 8.2% beat)
- Management lowered its full-year Adjusted EPS guidance to $5.55 at the midpoint, a 9.4% decrease
- Operating Margin: 16.9%, up from 14.4% in the same quarter last year
- Market Capitalization: $11.66 billion
StockStory’s Take
Clorox’s latest quarter was met with a negative market reaction, as management acknowledged a slower-than-expected pace of improvement in several business areas. CEO Linda Rendle cited the completion of a major enterprise resource planning (ERP) system rollout as a foundational step, but noted that supply chain costs were higher and margin improvement was gradual. The cleaning and international segments performed well, but momentum lagged in the Litter and Food divisions. Rendle characterized this as a "mixed" period, highlighting that although some categories gained market share, others struggled with competitive pressures and category declines.
Looking ahead, Clorox’s reduced profit guidance reflects a cautious stance on persistent cost inflation, especially from higher oil prices and ongoing supply chain challenges. CFO Luc Bellet emphasized that while the company has a strong track record with cost mitigation, the outlook for input costs remains uncertain, with potential volatility from external events such as geopolitical conflicts. Management is prioritizing value superiority—balancing pricing, innovation, and shelf presence—to regain share and drive growth, but acknowledged that improvements in certain categories, like Litter, will be a multi-year process.
Key Insights from Management’s Remarks
Management pointed to ERP stabilization, mixed category performance, and external cost pressures as the main influences on quarterly results and the updated outlook.
- ERP implementation impact: The recent ERP system rollout was completed, but caused temporary disruptions and higher supply chain costs, delaying anticipated cost savings and impacting gross margin, according to CFO Luc Bellet.
- Category performance divergence: While cleaning and international businesses outperformed, Litter and Food segments did not improve as planned. The Litter division, in particular, saw a slower recovery due to a complete product relaunch and challenges with shelf placement and consumer conversion.
- Innovation traction: Management highlighted strong early results from new product platforms like Clorox PURE (allergen removal) and an expanded Scentiva line, with retail partners showing enthusiasm and early velocity data exceeding expectations in several categories.
- Input cost headwinds: Rising oil prices created significant cost pressure, with Bellet noting a Q4 headwind of $20-25 million. Management expects mitigation actions—such as supply chain improvements and targeted price adjustments—but acknowledges uncertainty given geopolitical risks.
- Portfolio activity and discipline: Recent moves, including the GOJO acquisition and strategic shifts like divesting underperforming businesses, were framed as positioning Clorox for future growth. Management also stressed ongoing portfolio reviews to optimize resource allocation and category focus.
Drivers of Future Performance
Clorox’s guidance is shaped by input cost inflation, execution on innovation, and the integration of recent acquisitions.
- Cost inflation risk: Management anticipates continued volatility in input costs, especially from oil-related inflation, and is preparing a range of mitigation strategies, including pricing actions, supply chain efficiencies, and accelerated cost-saving initiatives.
- Innovation and shelf execution: The company’s ability to convert recent shelf space gains and new product launches into stronger sales—particularly in key categories like Litter and cleaning—will be critical for restoring growth and improving profitability.
- GOJO integration and synergies: The integration of the GOJO acquisition, with its focus on professional hygiene, is expected to provide both revenue growth and cost synergy opportunities, though initial margin dilution is anticipated before longer-term benefits are realized.
Catalysts in Upcoming Quarters
In the quarters ahead, our analysts will be focused on (1) the pace at which Clorox translates shelf space gains and new product launches into stronger sales and market share, (2) the company’s execution on cost mitigation and ability to absorb input cost inflation, and (3) progress on GOJO integration and realization of anticipated synergies. Any change in consumer behavior or further cost volatility will also be important markers.
Clorox currently trades at $88.05, down from $96.44 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free).
Our Favorite Stocks Right Now
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren't just high-quality businesses. Something is happening with them right now. Elite fundamentals meeting near-term momentum - both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week's Strong Momentum stocks - FREE. Get Our Strong Momentum Stocks for Free HERE.
Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
