Church & Dwight’s second quarter was marked by flat sales but a better-than-expected bottom line, as the company navigated a volatile consumer environment and persistent cost pressures. Management attributed the quarter’s results to strong performance from key brands like ARM & HAMMER, THERABREATH, and HERO, as well as continued market share gains in both domestic and international markets. CEO Richard Dierker noted that “category consumption has improved” and highlighted ongoing resilience in brand performance despite retail destocking and a challenging macroeconomic backdrop. The company’s operating margin decline reflected higher input costs, tariffs, and a product recall impact.
Is now the time to buy CHD? Find out in our full research report (it’s free).
Church & Dwight (CHD) Q2 CY2025 Highlights:
- Revenue: $1.51 billion vs analyst estimates of $1.48 billion (flat year on year, 1.6% beat)
- Adjusted EPS: $0.94 vs analyst estimates of $0.86 (9.7% beat)
- Adjusted EBITDA: $372.5 million vs analyst estimates of $349.9 million (24.7% margin, 6.5% beat)
- Revenue Guidance for Q3 CY2025 is $1.53 billion at the midpoint, roughly in line with what analysts were expecting
- Adjusted EPS guidance for Q3 CY2025 is $0.72 at the midpoint, below analyst estimates of $0.86
- Operating Margin: 17.4%, down from 22.3% in the same quarter last year
- Organic Revenue was flat year on year vs analyst estimates of flat growth (76.6 basis point beat)
- Market Capitalization: $22.47 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Church & Dwight’s Q2 Earnings Call
- Christopher Michael Carey (Wells Fargo) asked about strategic options for the vitamin business. CEO Richard Dierker explained options include a sale, joint venture, or focused restructuring to improve profitability, with a decision expected within months.
- Rupesh Dhinoj Parikh (Oppenheimer) inquired about retailer destocking. Dierker clarified the impact was about a 100 basis point drag in Q2 and is expected to be only a slight headwind in the second half.
- Peter K. Grom (UBS) sought clarity on the company’s category performance versus peers. Dierker maintained that Church & Dwight’s categories are holding up better due to strong brand positioning and innovation.
- Bonnie Lee Herzog (Goldman Sachs) questioned the promotional environment and gross margin outlook. Dierker and CFO Lee McChesney stressed promotions remain in line with historical norms, but tariffs and inflation continue to pressure margins.
- Andrea Faria Teixeira (JPMorgan) probed on innovation’s role and value share trends. Dierker highlighted that innovation is driving about half of recent organic growth and that both value and premium product segments are gaining share.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will be monitoring (1) the outcome of the strategic review and potential divestiture or turnaround of the vitamin business, (2) the effectiveness of new product launches and ongoing marketing investments in driving category and share gains, and (3) the company’s ability to mitigate margin pressures from tariffs and inflation through productivity and targeted pricing. Progress on integrating Touchland and further international expansion will also be key indicators of execution.
Church & Dwight currently trades at $92.25, down from $93.76 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free).
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