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Procter & Gamble (PG) executives know how to do a few things very well.
One is to create new versions of Tide detergent and Gillette razors that keep shoppers coming back to them, often at a higher price.
Another is to look under every rock to find internal cost savings — especially in times like today, when consumers are pulling back and tariff-related costs are on the rise.
To that end, P&G said Thursday it would slash 7,000 jobs, or about 6% of its total workforce, over the next two years. The consumer products giant has about 108,000 employees worldwide.
The restructuring decision, aired by company execs at a Deutsche Bank conference in Paris, comes on the heels of mixed quarterly results in late April. The company missed expectations on net sales and organic sales growth for the first quarter.
In the update, P&G joined other consumer goods leaders in buckling a bit under tariff-related economic headwinds. The company cut its full-year sales and earnings per share (EPS) outlooks, citing pressured consumers and cost uncertainty.
"We expect uncertainty to continue," P&G CEO Jon Moeller told Yahoo Finance at the time (see video above).
While consumers aren't trading down to cheaper products, they are shifting behaviors to save money, Moeller said. For example, P&G is seeing them do fewer laundry loads each week to conserve detergent.
Since P&G's earnings report, Yahoo Finance data shows analysts have been reducing their EPS estimates on the company for the next two quarters.
Shares have dropped 1.1% since the results on April 24, underperforming the Dow Jones Industrial Average's (^DJI) 8.35% gain and the S&P 500's (^GSPC) 13% advance. The stock was little changed in premarket trading on Thursday after the news.
"Procter’s 3Q results and 4Q guide-down confirmed that the slowdown in the U.S. ─ where category volumes ran flat in the four weeks ending April 6 ─ will likely persist for another couple of quarters and that the slowdown has already extended into Europe, particularly France," Evercore ISI analyst Robert Ottenstein warned in a note.
"A China bottoming but not recovering yet leaves Procter operating under tougher consumer environments in all its 'focus' markets or 80% of sales," Ottenstein added. "Moreover, $1.0-1.5 billion in potential tariffs-related costs add risk to pre-release consensus F2026 EPS of $7.27, or 8% growth against a reduced F2025 EPS of $6.72-6.82."
Brian Sozzi is Yahoo Finance's Executive Editor. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.
