Colgate-Palmolive Co.

Solid Q2 performance; broad-based growth and cash return - Management described Q2 as strong on both top and bottom line, with organic sales growth in 4 of 5 divisions and 3 of 4 categories. - Hill’s (pet) delivered strong results despite category softness; overall company strength supported by emerging markets (up mid-single digits, driven by India, Brazil, Mexico, China) and Europe (innovation + omni demand generation driving market share). - Free cash flow up 18% and $1.4B returned to shareholders in the quarter (no dividend changes discussed on this excerpt).

2026 outlook: gross margin expected roughly flat; conservative stance on organic sales range - Gross margin: up in Q2 (about +100 bps vs prior year quarter, and +90 bps vs prior quarter), with a modest tariff-refund benefit—but management emphasized core drivers (pricing, mix, productivity, and funding the growth). - Full-year gross margin guidance increased to “roughly flat” (i.e., not expecting major expansion), reflecting: - inflation and tariffs expected to be higher in 2H than in Q2, - confidence in execution to offset cost pressures. - Organic sales guidance not raised on the lower end: CEO/IR said remaining volatility and uncertainty (wars, consumer confidence, category softness, retailer inventory behavior) drove prudence; not assuming a smooth re-acceleration.

U.S. challenge: competition + softer consumption; actions planned for H2 - Management explicitly said U.S. performance was not satisfactory in Q2. - Causes cited: May category softness linked to peak gasoline prices and consumer caution, plus retailer inventory reductions (shipments down more than consumption in the quarter—shipments described as down ~3 while consumption ~1). - Mitigations for the back half: - step up premium innovation scale (e.g., Optic White Pro series / ActivShine; Fabuloso expansion), - surgical pricing/promo actions (address identified price gaps without becoming uncompetitive), - higher brand support/advertising in H2 as planned, - accelerate ’26 and ’27 innovation grids and execute behind revenue growth management.