Procter & Gamble Company (PG.US) withstands the impact of the Middle East war with its brands! Organic growth reaches a new high of over a year, maintaining full-year performance expectations.

International daily consumer goods leader Procter & Gamble Company (PG.US) has announced its latest performance data, which exceeds market expectations and is mainly driven by strong growth in the beauty product line; at the same time, the company has significantly raised its overall cost expectations related to commodities for the current fiscal year. The Iran war has begun to affect the selling prices, gross profit margins, and fundamental expectations of consumer goods companies, but the impact is not uniform. For giants in essential consumer goods like Procter & Gamble Company, the rise in oil prices mainly translates into the profit and loss statement through plastic, packaging, transportation, petrochemical raw materials, and energy costs. However, the latest performance of Procter & Gamble Company highlights the confidence in price increases and sales resilience driven by brand strength and high-end product innovation, demonstrating that essential consumer goods companies can partially pass on energy costs through "moderate price increases + product upgrades." Organic growth reaches over a year high! Procter & Gamble Company delivers strong financial results amid high oil prices Procter & Gamble Company's financial data shows that the overall organic sales (also known as internal sales indicators) in the third quarter, excluding acquisitions and exchange rate fluctuations, increased by 3% year-on-year in the company's third quarter ending March 31, exceeding the most optimistic forecasts of Wall Street analysts. This is the strongest organic growth data in over a year. The manufacturer of Tide laundry detergent and Herbal Essences shampoo announced quarterly sales performance that exceeded analysts' consensus expectations during the period. In recent quarters, Procter & Gamble Company has been focusing on developing new versions and formulas for its products and marketing them as more effective than competing brands, a strategy that appears to be paying off. CEO Shailesh Jejurikar stated in a statement that the company achieved "broad-based growth across categories" and is continuing to increase investments. Procter & Gamble Company's core earnings per share (EPS) on a Non-GAAP basis for the third quarter of the 2026 fiscal year were $1.59, higher than the market consensus of around $1.56 and the $1.54 in the same period last year; the operating profit for the third quarter was approximately $4.576 billion, significantly higher than market expectations and closely aligned with the strong profit data in the same period last year. Amid political turmoil in the Middle East and other regions leading to a significant increase in oil and gas energy prices and escalating macroeconomic uncertainty, coupled with cautious consumer spending, this performance is also a positive signal for the broader household daily consumer goods industry. Procter & Gamble Company is the largest market participant in this category and the first major essential consumer goods company to report its performance for the season. Benefiting from strong performance, the company's stock price has risen by 4.1% in pre-market trading. As of Thursday, the stock has risen by about 2% year-to-date, compared to a 4% increase in the S&P 500 index. Surprisingly, Procter & Gamble Company has maintained its core performance outlook for the current fiscal year, rather than withdrawing performance guidance as analysts expected due to the surge in oil and gas prices; the current fiscal year ends in June. However, the company now expects after-tax commodity costs to rise to approximately $150 million. Previously, the company expected the impact of commodities to be neutral. The company has maintained its expectation of approximately $400 million in after-tax tariff-related expenses for the year. Higher costs, along with an increased proportion of lower-margin product sales and other factors, have led to a slight decrease in gross margin, from 51% in the same period last year to 49.5%. Jejurikar took over as CEO at the beginning of 2026. He stated that despite the "challenging political and economic environment of the Middle East and other regions," the company remains optimistic. Procter & Gamble Company has increased prices by about 1% during the first calendar quarter, similar to the previous two quarters, as the company prioritizes increasing sales and market share. The beauty business is the best-performing department of the company, with organic sales growth of 7% in the first calendar quarter (the company's third quarter), the highest since 2023. This improvement was driven by changes in hair care product packaging specifications and prices, as well as product formula changes in Europe and North America. High oil prices impact consumption! Procter & Gamble Company stabilizes sales with brand strength, while non-essential consumption is more vulnerable to a "cost + demand" double blow Brent crude futures prices have surged over 50% since the outbreak of the Iran war at the end of February, and have continued to hover and stabilize around $100 per barrel, no longer the short-lived wild spike at the beginning of the GEO Group Inc political conflict indicating that high oil prices may be a sustained major threat. Investors, global central bank policymakers, and corporate leaders all have to face the potential long-term reality of high oil prices. On Tuesday afternoon Eastern Time, US President Trump announced on social media the extension of the ceasefire between the US and Iran, but Barclays PLC Sponsored ADR warned that the market should not be too optimistic about this development, as the US and Iran are far from truly reaching a peace agreement, and the extension of the ceasefire has not had any substantial effect on the volume of oil and gas transportation through the Strait of Hormuz. Barclays emphasized that the interruption of oil and gas transportation in the Strait of Hormuz continues to harm the global energy market, and stock and futures markets have not fully reflected this impact, with a pricing for the scale of supply disruption far below what is needed. The significant increase in oil prices due to the Iran war has undoubtedly begun to affect the selling prices, gross profit margins, and fundamental expectations of consumer goods companies, but this impact is not uniform. For giants in essential consumer goods like Procter & Gamble Company, the rise in oil prices mainly translates into the profit and loss statement through plastic, packaging, transportation, petrochemical raw materials, and energy costs. As oil prices rise from around $60 to nearly $100, Procter & Gamble Company expects a commodity cost impact of about $150 million for the current fiscal year, while also maintaining an expectation of approximately $400 million in after-tax tariff costs; Procter & Gamble Company achieved a 3% organic sales growth this quarter, with a 7% organic sales growth in the beauty business, indicating that its brand strength and high-end product innovation still have a certain resilience in terms of price increases and sales, but the gross margin has declined from 51% in the same period last year to 49.5%, which demonstrates the pressure from oil/commodities/tariffs squeezing profit margins. Essential consumer goods companies can partially pass on costs through "moderate price increases + product upgrades," but consumers are highly price-sensitive, and Procter & Gamble Company has only increased prices by 1% this quarter, indicating that it is also cautious about aggressive price hikes. Horizontally speaking, essential consumer goods are relatively controllable in the face of impact, while non-essential consumption and travel links are more susceptible to harm. PepsiCo, Inc. recently exceeded expectations with its resilience in demand for American salty snacks and sugar-free soft drinks, indicating that consumer goods companies are transitioning from "continued price increases" to "maintaining sales volume and market share"; an initial summary of financial reports for the latest U.S. stock reporting season also shows that the Iran war has led to a widespread increase in raw materials, transportation, and supply chain costs for industries ranging from paints and consumer goods to aviation travel, with many companies revising/downgrading performance guidance, with some companies starting to significantly raise prices; the United Nations' FAO also warns that if the Middle East conflict continues, global food prices may further rise under the push of oil prices. However, the rise in oil prices is not simply negative for consumer stocks, but a test of pricing pressure companies like Procter & Gamble Company and PepsiCo, Inc., with strong brand moats and products leaning towards essential needs, are more likely to maintain their fundamentals through slight price increases, promotion structures, and high-end + diversified product structures; whereas non-essential consumption sectors such as restaurants, clothing, tourism, aviation, and low-end retail are more susceptible to lower profit margins and demand expectations due to rising fuel, logistics, and packaging costs and decreasing consumer purchasing power.