Procter & Gamble, Pepsico and LG cut forecasts significantly on Thursday, warning of rising prices for everyday products ranging from toothpaste to toilet paper due to President Trump’s tariffs.
Procter & Gamble – the conglomerate behind major brands like Tide, Charmin, Bounty, Luvs and Crest – predicts flat sales growth from pre-projections of 2% to 4% increase.
“We need to mitigate the impact of all levers in our arsenal from cost structure and tariffs within the P&L,” P&G CFO Andre Schulten said in a call with reporters.
Schulten said pricing and cost reduction are the main levers, as changes in raw material sourcing from China are complex and difficult in the short term, mainly due to lack of options.
Price increases will occur next year, starting in July, if there is no trade agreement, he added. That’s the same as Trump is expected to lift a 90-day suspension of harsh tariff rates in many countries.
P&G imports raw materials, packaging materials and some finished products from China to the US, but the majority (about 90%) sell the majority are produced domestically, a company spokesperson said. Trump slapped imports from China with 145% tax.
Schulten pointed out that “more nervous consumers” will pull back spending in the last two months of the quarter as fears increase that tariffs will rekindle inflation.
“It’s not illogical to see consumers adopt a ‘wait’ attitude. We saw traffic dropping at retailers,” Schulten said. “We saw consumers who were basically looking for value. [retailers]. ”
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P&G shares fell nearly 5% in early afternoon trading. This is because homes of major industries also recorded a larger decline in third quarter revenue than expected.
According to analysts at LSEG, the company reported a lack of earnings per share, revenue of $1.54, forecasts of $1.53 and revenues below $19.78 billion.
The huge PepsiCo of soda and snacks also cut profit forecasts, warning that rising trade tensions have led to increased production costs and consumer spending.
“We expect more volatility and uncertainty, particularly related to global trade development. This is expected to increase supply chain costs,” Pepsico CEO Ramon Laguarta said in a statement.
The company, which owns brands such as Lay’s, Doritos, Gatorade and Quaker, has reduced its full-year revenue forecast by 3%, down from a single-digit low increase.
“We probably don’t feel that good about consumers compared to where we were three months ago,” said Jamie Caulfield, the company’s chief financial officer.
Pepsico is also planning to mitigate the impact of tariffs on the supply chain by adjusting adjustments to key inputs, Laguarta said.
The company has two edible plants in Mexico and two concentrated plants in Ireland. Both countries were hit by a universal 10% tariff on April 9, but Trump suspended its stiff mutual collection.
The average PepsiCo price rose 3% over the three months ended March 22nd, while organic volume fell 2%.
“Price Hiking has seen a ton of growth across large brands that are struggling to gain momentum across beloved brands like Pepsi, Gatorade, Lateos and Doritos.
According to analysts at LSEG, the company won $1.48 per share in the first quarter, reporting its revenue of $179.2 billion, surpassing $179.2 billion.
Electronics and home appliance maker LG also said it is weighing prices up, and is considering a potential production shift to the US to combat tariffs.
“We are also looking at optimizing production locations and increasing prices,” said Kim Iqueon, senior vice president at LG.
The Korean company could move the production of electrical appliances, such as washers and dryers, to its Tennessee plant. The production of that factory could cover almost a fifth of LG’s total residential appliance sales in the US.
With post wire
