CLOROX CO /DE/ (CLX): Results of Operations and Financial Condition
CLOROX CO /DE/ (CLX) filed an SEC Form 8-K — Results of Operations and Financial Condition. Clorox Reports Q4 and FY26 Results, Provides FY27 Outlook Delivers Q4 results in line with expectations while advancing strategic investments OAKLAND, California, Aug. 3, 2026 — The Clorox Company (NYSE: CLX) today reported results for the fourth quarter and fiscal year 2026, whi
How this was made
The 30-second read
Why it matters
The filing frames FY26 results as in-line with expectations while highlighting margin pressure from acquisition inventory step-up and ERP transition lapping, alongside progress on integration and modernization. The company states FY27 starts from a stronger execution position in a challenging environment.
Market read
This is a primary earnings release via SEC 8-K with quantified quarterly performance and integration/ERP transition drivers, plus qualitative FY27 outlook.
What to watch
Gross margin decline is attributed to GOJO inventory step-up and ERP shipment comparisons; traders may over-focus on headline margin without separating one-time acquisition accounting and transition timing effects.
Clorox Reports Q4 and FY26 Results, Provides FY27 Outlook
Fourth-quarter net sales, gross margin, diluted EPS and adjusted EPS declined, primarily reflecting ERP-related shipment comparisons, while Health and Wellness net sales grew and fiscal year 2027 guidance calls for net sales growth and higher diluted EPS.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Fourth-quarter net salesGAAP | $1.95 billion | – | decreased 2% |
| Fourth-quarter organic salesnon-GAAP | decreased 13% | – | decreased 13% |
| Fourth-quarter gross marginGAAP | 41.3% | – | decreased 520 basis points |
| Fourth-quarter diluted net earnings per shareGAAP | $1.34 | – | decreased 50% |
| Fourth-quarter adjusted EPSnon-GAAP | $1.66 | – | decreased 42% |
| Fiscal year 2026 net salesGAAP | $6.72 billion | – | decreased 5% |
| Fiscal year 2026 organic salesnon-GAAP | decreased 8% | – | decreased 8% |
| Fiscal year 2026 gross marginGAAP | 42.3% | – | decreased 290 basis points |
| Fiscal year 2026 diluted EPSGAAP | $4.81 | – | decreased 26% |
| Fiscal year 2026 adjusted EPSnon-GAAP | $5.53 | – | decreased 28% |
| Fiscal year 2026 net cash provided by operationsGAAP | $612 million | – | 38% decrease |
| Health and Wellness segment adjusted EBITnon-GAAP | decreased 15% | – | decreased 15% |
| Household segment adjusted EBITnon-GAAP | decreased 56% | – | decreased 56% |
| Lifestyle segment adjusted EBITnon-GAAP | decreased 60% | – | decreased 60% |
| International segment adjusted EBITnon-GAAP | increased 17% | – | increased 17% |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Health and Wellness (Cleaning; Professional Products, now including Clorox Purell)Driven by 10 points of higher volume and 6 points of favorable price mix. The GOJO acquisition contributed approximately 28 points to net sales growth. Organic sales declined 12%, primarily driven by the impact of lapping the incremental shipments related to the ERP transition in the year-ago quarter. | Net sales increased 16% | – | increased 16% |
| Household (Bags and Wraps; Cat Litter; Grilling)Driven by 16 points of lower volume and 2 points of unfavorable price mix. The volume decrease is primarily due to the impact of lapping the incremental shipments related to the ERP transition in the year-ago quarter and shipment ahead of consumption in the third quarter. | Net sales decreased 18% | – | decreased 18% |
| Lifestyle (Food; Water Filtration; Natural Personal Care)Driven by 14 points of lower volume and 3 points of unfavorable price mix. The volume decrease is primarily due to the impact of lapping the incremental shipments related to the ERP transition in the year-ago quarter. | Net sales decreased 17% | – | decreased 17% |
| International (Sales Outside the U.S.)Primarily driven by favorable foreign exchange rates. Organic sales grew 1%. | Net sales increased 4% | – | increased 4% |
Fiscal year 2027 outlook
- RevenueNet sales are expected to be up 13% to 14% compared to the prior year, including about 9.5 points of benefit from the GOJO acquisition.
- Gross marginabout 42%
- Operating expensesSelling and administrative expenses are expected to be about 16% of net sales. Advertising and sales promotion spending is expected to be about 10% of net sales.
- Tax rateabout 23%
- NoteOrganic sales are expected to increase about 3.5% to 4.5%, including more than 3.5 points of benefit from lapping the ERP-related drawdown in the prior fiscal year.
- NoteGross margin includes about 20 basis points of negative impact primarily related to the GOJO inventory step-up.
- NoteSelling and administrative expenses include about 40 basis points of negative impact from GOJO transaction-related costs.
- NoteAdvertising and sales promotion spending assumes over 11% of net sales for its retail businesses.
- NoteDiluted EPS is expected to be between $5.41 and $5.71, a year-over-year increase of 12% to 19%, respectively.
- NoteDiluted EPS includes about 29 cents of impact from transaction-related costs associated with the GOJO acquisition, which are expected to flow through cost of goods sold as well as selling and administrative expenses.
What drove it
- The GOJO acquisition added about 10 points to fourth-quarter net sales and about 3 points to fiscal year 2026 net sales.
- Fourth-quarter organic sales decreased 13%, primarily due to lapping the incremental shipments related to the ERP transition, which is about 13.5 points.
- Fiscal year 2026 organic sales decreased 8%, mainly due to lapping incremental shipments related to the ERP transition in the fourth quarter, which is about 7.5 points.
- Fourth-quarter gross margin was affected by lower volume, the impact from the inventory step-up of the GOJO acquisition, higher commodity costs and higher manufacturing and logistics costs, partially offset by cost savings.
- The company completed the acquisition of GOJO in April 2026 and completed its U.S. ERP implementation.
- Clorox’s global health and hygiene portfolio now represents more than half of net sales.
Concerns
- Fourth-quarter gross margin decreased 520 basis points to 41.3% from 46.5%.
- Fiscal year 2026 gross margin decreased 290 basis points to 42.3% from 45.2%.
- Household net sales decreased 18% and Lifestyle net sales decreased 17%.
- The fiscal year 2027 outlook assumes higher-than-normal inflationary headwinds and negative mix.
- The company expects the operating environment to remain challenging, with continued cost volatility and a value-seeking consumer.
What to watch
- Whether organic sales increase about 3.5% to 4.5% in fiscal year 2027.
- The expected more than 3.5 points of benefit to net sales growth from lapping the ERP-related drawdown.
- The approximately 9.5 points of expected benefit from the GOJO acquisition to fiscal year 2027 net sales growth.
- Gross margin expected to be about 42%, including about 20 basis points of negative impact primarily related to the GOJO inventory step-up.
- Selling and administrative expenses expected to include about 40 basis points of negative impact from GOJO transaction-related costs.
Balance sheet and cash flow
- Net cash provided by operations was $612 million compared to $981 million in fiscal year 2025, representing a 38% decrease.
- The decrease was primarily driven by the Glad Venture Agreement termination payment.
Analysis
Clorox closed fiscal year 2026 with a weak fourth-quarter comparison. Net sales decreased 2% to $1.95 billion, organic sales decreased 13%, gross margin decreased 520 basis points to 41.3%, diluted net earnings per share decreased 50% to $1.34, and adjusted EPS decreased 42% to $1.66. The company identified the ERP-related shipment comparison as about 13.5 points of the organic-sales decline and about 90 cents of the adjusted-EPS impact.
The sales mix across segments was uneven. Health and Wellness net sales increased 16%, supported by 10 points of higher volume, 6 points of favorable price mix and approximately 28 points from GOJO. In contrast, Household net sales decreased 18% and Lifestyle net sales decreased 17%, with each affected by lapping incremental ERP-transition shipments. International net sales increased 4%, primarily driven by favorable foreign exchange rates, while organic sales grew 1%.
Full-year results similarly reflected the ERP comparison and expense pressures. Fiscal year 2026 net sales decreased 5% to $6.72 billion and organic sales decreased 8%. Gross margin decreased 290 basis points to 42.3%, while diluted EPS decreased 26% to $4.81 and adjusted EPS decreased 28% to $5.53. The company cited lower net sales and higher manufacturing and logistics costs, partly offset by cost savings, and said GOJO transaction-related costs negatively affected gross margin by about 50 basis points.
Cash generation declined during the year. Net cash provided by operations was $612 million compared to $981 million in fiscal year 2025, with the decrease primarily driven by the Glad Venture Agreement termination payment. The company also completed the GOJO acquisition and its U.S. ERP implementation, while implementing a simplified operating structure.
Fiscal year 2027 guidance calls for net sales growth of 13% to 14%, including about 9.5 points from GOJO, and organic sales growth of about 3.5% to 4.5%. The outlook embeds more than 3.5 points of benefit from lapping the ERP-related drawdown, but also assumes higher-than-normal inflationary headwinds, negative mix and GOJO transaction-related costs. Gross margin is expected to be about 42%, and diluted EPS is expected to be between $5.41 and $5.71.
Management, verbatim
Our fourth-quarter results were in line with our expectations and reflect disciplined execution in a dynamic environment.
Linda Rendle, Chair and CEO
As we begin fiscal year 2027, we expect the operating environment to remain challenging, with continued cost volatility and a value-seeking consumer.
Linda Rendle, Chair and CEO
We are confident that the investments we've made in our brands, capabilities and products position us to deliver long-term value for shareholders.
Linda Rendle, Chair and CEO
Not in the filing
stated, not guessed- Fourth-quarter GAAP net income.
- Fiscal year 2026 GAAP net income.
- Fourth-quarter operating income.
- Fiscal year 2026 operating income.
- Fourth-quarter operating cash flow.
- Free cash flow.
- Cash balance.
- Debt balance.
- Share repurchases.
- Dividends.
- Dollar revenue for each reportable segment.
- Prior-quarter comparisons for reported metrics.
- Previous-release outlook for comparison with actual results.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
Clorox completed the GOJO Industries acquisition in April 2026 and also completed its U.S. ERP implementation as part of a multi-year digital transformation.
Ticker impact
Clorox reported Q4 and FY26 results on an 8-K, including net sales down 2% and gross margin down 520 bps, plus FY27 outlook language.
Near-term volatility likely as traders weigh margin compression and EPS decline against the acquisition integration and FY27 execution plan.
The filing provides multiple quantified P&L drivers (sales, gross margin, EPS) and qualitative FY27 positioning, but the excerpt does not include specific FY27 numeric guidance.
Market effects
Signals ongoing cost volatility and integration-related margin headwinds for consumer staples hygiene and cleaning peers, especially those with recent acquisitions or system transitions.
Limited direct regional read-through beyond Clorox’s stated international segment FX benefit.
Moderate, as the story is company-specific but touches broader consumer value-seeking and commodity/manufacturing cost dynamics.
Counterpoint
Organic sales weakness is partly attributed to lapping ERP-related incremental shipments; excluding that effect, organic sales would have increased, which could reduce the perceived demand deterioration.
Key entities
- issuerThe Clorox Company
Reported Q4 and FY26 results and provided qualitative FY27 outlook in an SEC 8-K.
- acquisition_targetGOJO Industries, Inc.
Acquired in April 2026; its integration and inventory step-up are cited as drivers of gross margin and EPS changes.
- executiveLinda Rendle
CEO and Chair quoted on results being in line with expectations and on FY27 execution.
