CLX · 10-Q · 2026Q3 · Full report

Margin Drivers

CLOROX CO /DE/ · 2026-11-02 · Importance 24 · Surprise 14

Gross margin declined 130 basis points year over year, from 41.7% to 40.4%, in the three months ended September 30, 2026. Higher commodity costs and higher manufacturing and logistics costs drove the decline, partly offset by higher volume and cost savings. Segment adjusted EBIT increased 69% in Health and Wellness, 11% in Household, 58% in Lifestyle, and 63% in International, with higher sales and cost savings supporting results and commodity, manufacturing, and logistics costs partially offsetting gains in certain segments.

Key facts

• Clorox’s gross margin decreased 130 basis points, from 41.7% to 40.4%, primarily due to higher commodity, manufacturing and logistics costs, partially offset by higher volume and cost savings. source
• Selling and administrative expenses as a percentage of net sales decreased 420 basis points, while dollars increased, primarily due to higher net sales. source
• Advertising costs as a percentage of net sales decreased 160 basis points, while dollars increased, primarily due to higher net sales. source
• Clorox’s U.S. retail advertising investment declined from 13% to 12% of net sales versus the prior three-month period. source
• Research and development costs as a percentage of net sales decreased 50 basis points while dollars were essentially flat; Clorox continued to invest in product innovation and cost savings. source
• Health and Wellness segment adjusted EBIT increased 69%, primarily due to higher net sales and cost savings, partially offset by higher manufacturing, logistics and commodity costs. source
• Household segment adjusted EBIT increased 11%, mainly due to higher net sales, partially offset by higher commodity, manufacturing and logistics costs. source
• Lifestyle segment adjusted EBIT increased 58%, primarily due to higher net sales, partially offset by higher commodity costs. source