PG Faces 8% Earnings Headwind in Fiscal 2027

P&G Enters Fiscal 2027 with Significant Earnings Hurdle

The Procter & Gamble Company (PG) starts fiscal 2027 facing an 8% drag on core earnings per share due to various headwinds. Management expects 1% to 3% organic sales growth, but higher costs, financing expenses, lower non-operating income, and currency fluctuations will weigh on profit growth.

The largest headwind is estimated $1 billion after tax from higher raw-material, energy, transportation, and related costs. This cost dynamic will contribute to a decline of at least 5% in first-quarter fiscal 2027 earnings per share. P&G expects net interest expense to reduce earnings by about $150 million after tax, lower non-operating income to create another $150 million drag, and unfavorable foreign exchange to reduce earnings by roughly $50 million after tax.

P&G's productivity improvement is expected to offset some of these pressures. The company generated about $2.8 billion of before-tax productivity improvement across cost of goods sold and selling, general and administrative expenses in fiscal 2026.