Church & Dwight’s first quarter results were met with a negative market reaction, as the company’s sales fell below Wall Street expectations amid ongoing retail destocking and softening consumer demand in the United States. Management pointed to a 300 basis point drag on organic growth from retailers reducing inventory and highlighted persistent weakness in core U.S. product categories. CEO Rick Dierker acknowledged, “In the U.S., consumer spending continues to sequentially weaken,” and noted that the company’s strong brand performance was not enough to offset these headwinds. While Church & Dwight gained market share in several categories, the company faced challenges in its vitamin and dry shampoo businesses, where supply chain issues and competitive pricing impacted results.
Is now the time to buy CHD? Find out in our full research report (it’s free).
Church & Dwight (CHD) Q1 CY2025 Highlights:
- Revenue: $1.47 billion vs analyst estimates of $1.51 billion (2.4% year-on-year decline, 3% miss)
- Adjusted EPS: $0.91 vs analyst estimates of $0.90 (1.4% beat)
- Adjusted EBITDA: $363.4 million vs analyst estimates of $361.7 million (24.8% margin, in line)
- Revenue Guidance for Q2 CY2025 is $1.5 billion at the midpoint, below analyst estimates of $1.56 billion
- Adjusted EPS guidance for Q2 CY2025 is $0.85 at the midpoint, below analyst estimates of $0.95
- Operating Margin: 20.1%, in line with the same quarter last year
- Organic Revenue fell 1.2% year on year (5.2% in the same quarter last year)
- Market Capitalization: $23.46 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Church & Dwight’s Q1 Earnings Call
- Rupesh Parikh (Oppenheimer) asked about updated growth expectations by segment. CFO Lee McChesney said international was on track, with domestic sales remaining weak due to macro pressures and inventory reductions.
- Chris Carey (Wells Fargo) pushed for clarity on tariff impacts and long-term exposure. CEO Rick Dierker detailed a reduction from $190 million to $40 million through business exits and sourcing changes, calling the remaining exposure “manageable.”
- Steve Powers (Deutsche Bank) questioned the bridge to second-half improvement given the lack of expected consumption recovery. Dierker pointed to distribution gains and continued innovation but acknowledged category growth is unusually weak.
- Olivia Tong (Raymond James) inquired about pricing strategy in a declining category environment. Dierker said the company is avoiding broad price increases, focusing instead on cost mitigation and selective, “surgical” pricing where necessary.
- Javier Escalante (Evercore) sought detail on vitamin business strategy and the impact of drug store channel weakness. Dierker explained a focus on retrenching to stronger subsegments and increasing online presence, given low loyalty and fragmented distribution.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will monitor (1) the success of new product launches and reformulations—especially in vitamins and personal care, (2) evidence that supply chain and portfolio changes are effectively reducing tariff and cost pressures, and (3) whether U.S. consumer demand and retailer inventory trends stabilize or remain subdued. M&A activity and further portfolio adjustments will also be important signposts for the company’s strategic direction.
Church & Dwight currently trades at $95.25, down from $99.15 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free).
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