Procter & Gamble's sales rose 3% in the fiscal fourth quarter, but the world's largest consumer products maker gave a lackluster fiscal 2023 sales forecast as it contends with rising commodity and freight costs.
Shares of the Cincinnati-based company dropped nearly 5% at the market open on Friday.
Like many businesses, P&G is dealing with consumers pulling back on their spending as they worry about inflation and a possible recession.
“The operational cost and currency challenges we faced over the last two years will continue in fiscal 2023. We began the new fiscal year with consumers facing inflation levels not seen in the last 40 years," Chairman and CEO Jon Moeller said during a conference call.
Despite consumers' growing concerns, P&G's revenue climbed to $19.52 billion from $18.9 billion during the quarter, helped by higher prices. This topped the $19.39 billion that analysts surveyed by Zacks Investment Research were looking for.
The company reported sales growth in its health care, fabric and home care and baby, feminine and family care segments. Its brands include Tide detergent, Gillette razors and Pampers diapers.
P&G earned $3.05 billion, or $1.21 per share, for the April through June period. That's 2 cents shy of what Wall Street expected.
The company reported fiscal 2022 sales of $80.2 billion and earnings of $5.81 per share.
For fiscal 2023, P&G foresees sales to be flat to up 2% from the prior year. Earnings are anticipated to be flat to up 4% from the previous year's $5.81 per share. Analysts polled by FactSet expect sales of $81.89 billion and earnings of $6.02 per share.
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