I'll research CLX before writing the preview. Let me gather recent filings, transcripts, and news.Let me read the most recent Q3 2026 transcript and release, plus the year-ago Q4 2025 release for context.Let me get the year-ago Q4 2025 release for the comparison base, recent stock price, and analyst expectations.Let me get the Q1 and Q2 FY26 figures to derive the implied Q4, and check analyst expectations.Let me get Q1 FY26 numbers and fix the web search.# Clorox (CLX) — Earnings Preview
This is the quarter Clorox has been telling investors to look through. FQ4 FY26 laps the enormous ERP-related inventory pull-forward that inflated the year-ago June quarter, so the reported numbers will show big optical declines by design. The real news will be (a) whether underlying momentum is actually improving beneath the noise, and (b) the first FY27 outlook — the first "clean" year post-ERP and the first full year with GOJO/Purell. That guide, not the Q4 print, is the event.
The stock sets up cautiously: CLX closed ~$95.55 on 7/31, down roughly 25% from its February peak (~$127) and modestly negative year-to-date. Shares gapped down ~10% the day after the disappointing Q3 report (May 1) and have only partially clawed back.
At the end of FQ4 FY25, retailers bought ~2 weeks of extra inventory ahead of Clorox's U.S. ERP cutover. That pull-forward added ~13–14 points to year-ago Q4 sales and ~$0.85–0.95 to FY25 EPS — a benefit that reverses this fiscal year. So the June-2026 quarter is comping against an artificially fat base.
Layered on top: - GOJO/Purell (closed April 1) is in for a full quarter — roughly +$200M in sales (~+10% to the quarter), but it carries transaction/inventory step-up onetime costs. - Middle East / oil cost spike hit late — management sized it at ~$20–25M (~130 bps of gross margin) in Q4 alone, with no time yet to deploy mitigation.
Net: expect a headline revenue decline, a sharp gross-margin step-down, and a large year-over-year EPS drop that are largely mechanical. Focus instead on organic trend ex-ERP, share data, and the margin bridge.
Clorox guides annually, so Q4 is a "plug." Backing FQ4 out of the full-year outlook it reaffirmed/cut at Q3:
| Metric | Implied FQ4 FY26 | Year-ago FQ4 FY25 |
|---|---|---|
| Net sales | ~$1.9B (≈ -4% reported) | $1,988M (had +13–14 pts ERP benefit) |
| — of which GOJO | ~+$200M (~+10%) | — |
| Adjusted EPS | ~$1.57–$1.77 (mid ~$1.67) | $2.87 (incl. ~$0.85–0.95 ERP benefit) |
| Diluted GAAP EPS | ~$1.30–$1.50 | $2.68 |
| Gross margin | ~41–42% (implied) | 46.5% |
Underlying takeaway: strip out GOJO and the reported ~4% decline masks a double-digit organic drop that is almost entirely the ERP lap. Investors should normalize for it — the question is whether the ex-ERP organic line is stabilizing.
Full-year FY26 outlook (as cut at Q3, April 30): - Net sales down ~6%; organic down ~9% (incl. ~7.5 pts ERP reversal) - Gross margin down 250–300 bps (was originally guided down just 50–100 bps) - Adjusted EPS $5.45–$5.65 (cut from the original $5.95–$6.30); GAAP $4.78–$4.98
The Q3 guidance cut (~$0.50 off adjusted EPS midpoint) was driven by higher supply-chain/logistics costs, delayed cost savings tied to ERP stabilization, the new oil headwind, and GOJO onetime costs — not a demand collapse. Watch whether Q4 lands at, above, or below the reduced bar.
Management explicitly declined FY27 numbers at Q3 but seeded the key swing factors. This is what to listen for:
Working well: - Cleaning (largest business): Consistent share gains despite heavy promo; Clorox PURE (allergen platform) launched with velocities above expectations and preferred shelf placement; Scentiva expansion strong. - International: Resilient; organic +2–5% in recent quarters, EBIT up double digits. - Glad: Inflecting after years as a "thorn" — sequential share gains, trash category up ~2 pts, benefiting from the JV buyout (faster innovation) and sharper price points. But it's the most resin/oil-exposed line — watch the growth-vs-margin balance if input costs bite.
Watch closely / the problem children: - Cat Litter (Fresh Step): The key disappointment. A full "reinvention" (new UPCs, claims, pack architecture) began rolling out late Q3 — a hard conversion causing out-of-stocks, shelf-placement issues, and weak velocities. Management calls it multiyear and "bumpy." Distribution (TDPs) came, but sell-through hasn't yet. Litter velocity/share is the swing execution item. - Food (Hidden Valley): Returned to share growth, but the category weakened to a mid-single-digit decline with heavy competitor discounting and GLP-1 demand questions. New trend-forward launches (avocado oil, protein) and reverting to the classic 16-oz bottle are the fixes to prove out.
Execution flag across the portfolio: Total distribution points were up ~5% at Q3, but velocities lagged — retailer resets run through Q4 and items weren't always shelved in the right spot. Improving on-shelf execution + turning on advertising is the thesis for a Q4/FY27 velocity inflection.
Consumer backdrop: Categories tracking flat to +1%; consumer "resilient" but under stress from gas prices; private label share flat/stabilized (a positive), though Brita is a watch item.
Gross margin has ratcheted down all year (Q1 41.7%, Q2 43.2%, Q3 43.2%) versus the mid-46% seen a year ago. FQ4's implied ~41–42% reflects: ~150 bps from lapping ERP shipment leverage, ~200 bps from GOJO (incl. ~150 bps onetime inventory step-up), ~100–150 bps from oil, and ~50 bps from a onetime charge to accelerate a large supply-chain cost-savings project into FY27. Most of these are transitory — the debate is how quickly margin re-expands in FY27.
The GOJO deal was debt-financed: notes/loans payable jumped to ~$1.59B (from ~$4M) and cash sat at ~$1.19B at 3/31 pending close. Interest expense is rising (~+$30M in Q4; ~+$110M in FY27 above run-rate). Watch commentary on leverage, credit rating, and dividend capacity (CLX is a dividend aristocrat; the payout is a core part of the story). Year-to-date operating cash flow was down sharply, partly reflecting the Glad JV termination payment.
Judge FQ4 on trajectory, not the optics. The headline declines and margin compression are largely engineered by the ERP lap, GOJO onetime items, and a late oil spike — all transitory. The bull case rests on: Cleaning/International strength, a genuinely inflecting Glad, PURE's strong launch, stabilizing private label, and a depressed FY26 base that should make FY27 look better. The bear case: litter execution keeps slipping, oil inflation proves sticky against a stressed consumer, and GOJO's dilution/interest muddies the "clean" year. With shares down ~25% from their highs, expectations are reset — so the tone and math of the FY27 outlook will likely drive the stock more than anything in the printed quarter.
Note: implied FQ4 figures are derived from Clorox's reaffirmed full-year FY26 outlook minus reported nine-month results; they are estimates, not company Q4 guidance. Clorox does not guide quarterly.