Clorox Co 10-Q for FY2026 Q3
Clorox Co (CLX)
10-Q
2026-04-30
For: 2026-03-31
View Original
Added on
April 30, 2026
About this 10-Q
Clorox Co filed this 10-Q on April 30, 2026, covering the quarter ended March 31, 2026 (FY2026 Q3).
Headline figures
Quarter ended March 31, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $1.67B
- up 0.1% from $1.67B a year earlier
- Net income
- $187M
- up 0.5% from net income of $186M a year earlier
- Diluted EPS
- $1.54
- up 2.7% from $1.50 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| (Mark One) | ||||||||||||||
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||||||||||
For the quarterly period ended March 31, 2026 .
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from to
Commission File Number: 1-07151
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of | (I.R.S. Employer Identification No.) | ||||
| incorporation or organization) | |||||
(Address of principal executive offices) (Zip code)
(510 ) 271-7000
(Registrant’s telephone number, including area code)
| (Former name, former address and former fiscal year, if changed since last report) | ||||||||
| ___________________ | ||||||||
| Securities registered pursuant to Section 12(b) of the Act: | ||||||||
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☑ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | Smaller Reporting Company | Emerging Growth Company | |||||||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
As of April 16, 2026, there were 120,921,351 shares outstanding of the registrant’s common stock ($1.00 par value).
1
TABLE OF CONTENTS
Page | ||||||||
2
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
The Clorox Company
Condensed Consolidated Statements of Earnings (Unaudited)
(Dollars in millions, except per share data)
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of products sold | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Selling and administrative expenses | |||||||||||||||||||||||
| Advertising costs | |||||||||||||||||||||||
| Research and development costs | |||||||||||||||||||||||
Loss on divestiture | |||||||||||||||||||||||
| Interest expense | |||||||||||||||||||||||
| Other (income) expense, net | ( | ( | |||||||||||||||||||||
Earnings before income taxes | |||||||||||||||||||||||
Income tax expense | |||||||||||||||||||||||
Net earnings | |||||||||||||||||||||||
| Less: Net earnings attributable to noncontrolling interests | |||||||||||||||||||||||
Net earnings attributable to Clorox | $ | $ | $ | $ | |||||||||||||||||||
Net earnings per share attributable to Clorox | |||||||||||||||||||||||
Basic net earnings per share | $ | $ | $ | $ | |||||||||||||||||||
Diluted net earnings per share | $ | $ | $ | $ | |||||||||||||||||||
| Weighted average shares outstanding (in thousands) | |||||||||||||||||||||||
| Basic | |||||||||||||||||||||||
| Diluted | |||||||||||||||||||||||
See Notes to Condensed Consolidated Financial Statements (Unaudited)
3
The Clorox Company
Condensed Consolidated Statements of Comprehensive Income (Unaudited)
(Dollars in millions)
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
Net earnings | $ | $ | $ | $ | |||||||||||||||||||
| Other comprehensive income (loss), net of tax: | |||||||||||||||||||||||
| Foreign currency translation adjustments | ( | ( | |||||||||||||||||||||
| Net unrealized gains (losses) on derivatives | ( | ( | |||||||||||||||||||||
| Pension and postretirement benefit adjustments | ( | ( | |||||||||||||||||||||
| Total other comprehensive (loss) income, net of tax | ( | ||||||||||||||||||||||
Comprehensive income | |||||||||||||||||||||||
| Less: Total comprehensive income attributable to noncontrolling interests | |||||||||||||||||||||||
Total comprehensive income attributable to Clorox | $ | $ | $ | $ | |||||||||||||||||||
See Notes to Condensed Consolidated Financial Statements (Unaudited)
4
The Clorox Company
Condensed Consolidated Balance Sheets
(Dollars in millions, except per share data)
| 3/31/2026 | 6/30/2025 | ||||||||||
(Unaudited) | |||||||||||
| ASSETS | |||||||||||
| Current assets | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Receivables, net | |||||||||||
| Inventories, net | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total current assets | |||||||||||
Property, plant and equipment, net of accumulated depreciation and amortization of $ | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Goodwill | |||||||||||
| Trademarks, net | |||||||||||
| Other intangible assets, net | |||||||||||
| Other assets | |||||||||||
| Total assets | $ | $ | |||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities | |||||||||||
| Notes and loans payable | $ | $ | |||||||||
| Current operating lease liabilities | |||||||||||
| Accounts payable and accrued liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Long-term debt | |||||||||||
| Long-term operating lease liabilities | |||||||||||
| Other liabilities | |||||||||||
| Deferred income taxes | |||||||||||
| Total liabilities | |||||||||||
| Commitments and contingencies | |||||||||||
| Stockholders’ equity | |||||||||||
Preferred stock: $ | |||||||||||
Common stock: $ | |||||||||||
| Additional paid-in capital | |||||||||||
| Retained earnings | |||||||||||
Treasury stock, at cost: and June 30, 2025, respectively | ( | ( | |||||||||
| Accumulated other comprehensive net (loss) income | ( | ( | |||||||||
Total Clorox stockholders’ (deficit) equity | ( | ||||||||||
| Noncontrolling interests | |||||||||||
| Total stockholders’ equity | |||||||||||
| Total liabilities and stockholders’ equity | $ | $ | |||||||||
See Notes to Condensed Consolidated Financial Statements (Unaudited)
5
The Clorox Company
Condensed Consolidated Statements of Cash Flows (Unaudited)
(Dollars in millions)
| Nine months ended | |||||||||||
| 3/31/2026 | 3/31/2025 | ||||||||||
| Operating activities: | |||||||||||
Net earnings | $ | $ | |||||||||
Adjustments to reconcile net earnings to net cash provided by operations: | |||||||||||
| Depreciation and amortization | |||||||||||
| Stock-based compensation | |||||||||||
| Deferred income taxes | ( | ||||||||||
Venture Agreement termination payment | ( | ||||||||||
Loss on divestiture | |||||||||||
| Other | ( | ( | |||||||||
| Changes in: | |||||||||||
| Receivables, net | |||||||||||
| Inventories, net | ( | ( | |||||||||
| Prepaid expenses and other current assets | ( | ( | |||||||||
| Accounts payable and accrued liabilities | ( | ( | |||||||||
| Operating lease right-of-use assets and liabilities, net | ( | ||||||||||
| Income taxes payable / prepaid | ( | ( | |||||||||
| Net cash provided by operations | |||||||||||
| Investing activities: | |||||||||||
| Capital expenditures | ( | ( | |||||||||
Proceeds from divestiture, net of cash divested | |||||||||||
| Other | ( | ||||||||||
Net cash used for investing activities | ( | ( | |||||||||
| Financing activities: | |||||||||||
| Notes and loans payable, net | |||||||||||
| Treasury stock purchased | ( | ( | |||||||||
| Cash dividends paid to Clorox stockholders | ( | ( | |||||||||
| Cash dividends paid to noncontrolling interests | ( | ||||||||||
| Issuance of common stock for employee stock plans and other | ( | ||||||||||
Net cash provided by (used for) financing activities | ( | ||||||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | ( | ( | |||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | |||||||||||
| Cash, cash equivalents and restricted cash: | |||||||||||
| Beginning of period | |||||||||||
| End of period | $ | $ | |||||||||
See Notes to Condensed Consolidated Financial Statements (Unaudited)
6
The Clorox Company
Notes to Condensed Consolidated Financial Statements (Unaudited)
(Dollars in millions, except per share data)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The unaudited interim condensed consolidated financial statements for the three and nine months ended March 31, 2026 and 2025, in the opinion of management, reflect all normal and recurring adjustments considered necessary for a fair presentation of the consolidated results of operations, financial position and cash flows of The Clorox Company and its controlled subsidiaries (the Company or Clorox) for the periods presented. However, the financial results for interim periods are not necessarily indicative of the results that may be expected for a full fiscal year or for any other future period. Percentage and basis point calculations are based on rounded numbers, except for per share data and the effective tax rate.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (U.S. GAAP) have been omitted or condensed pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). The information in this report should be read in conjunction with the Company’s Annual Report on Form 10-K filed with the SEC for the fiscal year ended June 30, 2025, which includes a complete set of footnote disclosures, including the Company’s significant accounting policies.
Recently Issued Accounting Standards
Recently Issued Accounting Standards Not Yet Adopted
In September 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2025-06, “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (ASU 2025-06)”, which modernizes the accounting for internal-use software to current development practices, clarifies when to begin capitalizing costs and enhances disclosure requirements. The ASU is effective for annual reporting periods beginning after December 15, 2027, and for interim periods within those annual reporting periods, with early adoption permitted as of the beginning of an annual reporting period. The Company is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements.
In November 2024, the FASB issued ASU No. 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.” These amendments primarily require enhanced quantitative and qualitative disclosures in the notes to the financial statements for specific expense categories underlying the expenses presented on the income statement. These amendments are to be applied prospectively to financial statements issued after the effective date or retrospectively to any or all periods presented in the financial statements. Early adoption is permitted. The standard will be effective for annual periods beginning after December 15, 2026, and subsequent interim periods. The Company is currently evaluating the impact that the adoption of this guidance will have on the Company’s disclosures.
In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” These amendments primarily require enhanced disclosures and disaggregation of income tax information by jurisdiction in the annual income tax reconciliation and quantitative and qualitative disclosures regarding income taxes paid. These amendments are to be applied prospectively, with the option to apply the standard retrospectively, for annual periods beginning after December 15, 2024. Other than the new disclosure requirements, this guidance will not have an impact on the Company’s consolidated financial statements.
Recently Adopted Accounting Standards
7
NOTE 2. VENTURE AGREEMENT
The Company’s venture agreement with The Procter & Gamble Company (P&G) for the Company’s Glad bags and wraps business (the Venture Agreement) expired on January 31, 2026. In connection with this agreement, P&G provided research and development (R&D) support to the Glad business. As of June 30, 2025, P&G had a 20 % interest in the venture. The Company paid a royalty to P&G for its interest in the profits, losses and cash flows, as contractually defined, of the Glad business, which is included in Cost of products sold.
The Venture Agreement, at its expiration, required the Company to purchase P&G’s 20 % interest for cash at fair value as established by predetermined valuation procedures. As of June 30, 2025, the estimated fair value of P&G’s interest in the venture was $476 , of which $501 was recognized and reflected in Accounts payable and accrued liabilities in the Company’s condensed consolidated balance sheet.
On January 31, 2026, the Company and P&G agreed that the Company would purchase P&G’s 20 % interest, which was paid in cash for $476 on March 2, 2026 and is reflected in Operating activities within the condensed consolidated statement of cash flows.
The Glad business will continue to retain the exclusive core intellectual property licenses contributed by P&G on a royalty-free basis for the licensed products marketed.
NOTE 3. DIVESTITURE
Divestiture of Better Health Vitamins, Minerals and Supplements (VMS) Business
On September 10, 2024, the Company completed the divestiture of its Better Health VMS business. As a result of the transaction, the Company recorded an after tax loss of $118 during the first quarter of fiscal year 2025. Net sales of the Better Health VMS business for the three and nine months ended March 31, 2025 were $0 and $38 , respectively. Refer to notes to consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended June 30, 2025 for further information related to the Better Health VMS business divestiture.
NOTE 4. INVENTORIES, NET
Inventories, net consisted of the following as of:
| 3/31/2026 | 6/30/2025 | ||||||||||
| Finished goods | $ | $ | |||||||||
| Raw materials and packaging | |||||||||||
| Work in process | |||||||||||
| LIFO allowances | ( | ( | |||||||||
| Total inventories, net | $ | $ | |||||||||
NOTE 5. SUPPLY CHAIN FINANCING PROGRAM
The Company has arranged for a global financial institution to offer a voluntary supply chain finance (SCF) program for the benefit of the Company’s suppliers. The Company’s current payment terms do not exceed 120 days in keeping with industry standards. The Company’s operating cash flows are directly impacted as a result of the extension of payment terms with suppliers. The SCF program enables suppliers to directly contract with the financial institution to receive payment from the financial institution prior to the payment terms between the Company and the supplier by selling the Company’s payables to the financial institution. Participation in the program is at the sole discretion of the supplier and the Company has no economic interest in a supplier's decision to enter into the agreement and has no direct financial relationship with the financial institution, as it relates to the SCF program. Once a supplier elects to participate in the SCF program and reaches an agreement with the financial institution, the supplier elects which individual Company invoices to sell to the financial institution. The terms of the Company’s payment obligations are not impacted by a supplier’s participation in the program and as such, the SCF program has no direct impact on the Company’s balance sheets or liquidity. The Company has not pledged any assets as security or provided guarantees under the SCF program.
8
NOTE 6. DEBT
Short-term borrowings
As of March 31, 2026, the Company had outstanding $1,591 of Notes and loans payable primarily comprised of U.S. commercial paper borrowings to finance the previously announced GOJO Industries, Inc. (GOJO) acquisition and fund the Venture Agreement termination payment. See Note 14 and Note 2 for additional details related to the acquisition and Venture Agreement payment, respectively.
The weighted average effective interest rate of notes and loans payable as of March 31, 2026 and June 30, 2025 was 4.00 % and 4.61 %, respectively.
Credit arrangements
On March 6, 2026, in connection with the acquisition of GOJO, the Company entered into a $1,000 364-day revolving credit agreement (the 364-Day Revolving Credit Agreement) that matures on March 5, 2027, and a $1,250 Delayed Draw Term Credit Agreement (the Delayed Draw Term Credit Agreement). Any loans under the Delayed Draw Term Credit Agreement mature on March 5, 2027. Amounts available under the 364-Day Revolving Credit Agreement are for general corporate purposes. The Delayed Draw Term Credit Agreement provides the Company with the ability to borrow up to $1,250 at the closing of the GOJO acquisition, subject to satisfaction of customary closing conditions for similar facilities, for the purpose of financing a portion of the consideration under the membership interest purchase agreement (the Acquisition Agreement), paying related fees and expenses and repaying certain indebtedness of GOJO as contemplated by the Acquisition Agreement, with remaining amounts available to Clorox for general corporate purposes. The 364-Day Revolving Credit Agreement and Delayed Draw Term Credit Agreement are incremental to the existing $1,200 revolving credit agreement available to Clorox for general corporate purposes that matures in March 2030.
There were no no 1,200 revolving credit agreement that matures in March 2030 as of March 31, 2026 or June 30, 2025. The 364-Day Revolving Credit Agreement and Delayed Draw Term Credit Agreement include certain restrictive covenants and limitations consistent with the existing revolving credit agreement, with which the Company was in compliance as of March 31, 2026.
NOTE 7. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
Financial Risk Management and Derivative Instruments
The Company is exposed to certain commodity, foreign currency and interest rate risks related to its ongoing business operations and uses derivative instruments to mitigate its exposure to these risks.
Commodity Price Risk Management
The Company may use commodity futures, options and swap contracts to limit the impact of price volatility on a portion of its forecasted raw material requirements. These commodity derivatives may be exchange traded or over-the-counter contracts and generally have original contractual maturities of less than 2 years. Commodity purchase and options contracts are measured at fair value using market quotations obtained from the Chicago Board of Trade commodity futures exchange and commodity derivative dealers.
The notional amounts of outstanding commodity derivatives, which related primarily to exposures in soybean oil used for the food business and jet fuel used for the grilling business, were $29 and $36 as of March 31, 2026 and June 30, 2025, respectively.
Foreign Currency Risk Management
The Company may also enter into certain over-the-counter derivative contracts to manage a portion of the Company’s forecasted foreign currency exposure associated with the purchase of inventory. These foreign currency contracts generally have original contractual maturities of less than 2 years. The foreign exchange contracts are measured at fair value using information quoted by foreign exchange dealers.
The notional amounts of outstanding foreign currency forward contracts used by the Company’s subsidiaries to hedge forecasted purchases of inventory were $41 and $67 as of March 31, 2026 and June 30, 2025, respectively.
9
NOTE 7. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued)
Interest Rate Risk Management
The Company may enter into over-the-counter interest rate contracts to fix a portion of the benchmark interest rate prior to the anticipated issuance of fixed rate debt. These interest rate contracts generally have original contractual maturities of less than 3 years. The interest rate contracts are measured at fair value using information quoted by bond dealers.
The notional amounts of outstanding interest rate contracts used by the Company to hedge forecasted debt issuance were $200 and $0 as of March 31, 2026 and June 30, 2025, respectively. These contracts represent interest rate swap lock agreements to manage the exposure to interest rate volatility associated with future interest payments on the forecasted debt issuance as part of the GOJO acquisition.
Commodity, Foreign Exchange and Interest Rate Derivatives
The Company designates its commodity forward, futures and options contracts for forecasted purchases of raw materials, foreign currency forward contracts for forecasted purchases of inventory and interest rate contracts for forecasted interest payments as cash flow hedges.
The effects of derivative instruments designated as hedging instruments on Other comprehensive (loss) income and Net earnings were as follows:
| Gains (losses) recognized in Other comprehensive (loss) income | |||||||||||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
| Commodity purchase derivative contracts | $ | $ | $ | $ | ( | ||||||||||||||||||
| Foreign exchange derivative contracts | ( | ||||||||||||||||||||||
| Interest rate derivative contracts | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | ( | ||||||||||||||||||
| Location of gains (losses) reclassified from Accumulated other comprehensive net (loss) income into Net earnings | Gains (losses) reclassified from Accumulated other comprehensive net (loss) income and recognized in Net earnings | |||||||||||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | |||||||||||||||||||||||
| Commodity purchase derivative contracts | Cost of products sold | $ | $ | ( | $ | $ | ( | |||||||||||||||||||
| Foreign exchange derivative contracts | Cost of products sold | ( | ( | |||||||||||||||||||||||
| Interest rate derivative contracts | Interest expense | |||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||
The estimated amount of the existing net gain (loss) in Accumulated other comprehensive net (loss) income as of March 31, 2026 that is expected to be reclassified into Net earnings within the next twelve months is $26 .
Counterparty Risk Management and Derivative Contract Requirements
The Company utilizes a variety of financial institutions as counterparties for over-the-counter derivative instruments. The Company enters into agreements governing the use of over-the-counter derivative instruments and sets internal limits on the aggregate over-the-counter derivative instrument positions held with each counterparty. Certain terms of these agreements require the Company or the counterparty to post collateral when the fair value of the derivative instruments exceeds contractually defined counterparty liability position limits. Of the over-the-counter derivative instruments in liability positions, $0 and $2 contained such terms as of March 31, 2026 and June 30, 2025, respectively. As of both March 31, 2026 and June 30, 2025, neither the Company nor any counterparty was required to post any collateral as no counterparty liability position limits were exceeded.
10
NOTE 7. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued)
Certain terms of the agreements governing the Company’s over-the-counter derivative instruments require the Company’s credit ratings, as assigned by Standard & Poor’s and Moody’s to the Company and its counterparties, to remain at a level equal to or better than the minimum of an investment grade credit rating. If the Company’s credit ratings were to fall below investment grade, the counterparties to the derivative instruments could request full collateralization on derivative instruments in net liability positions. As of both March 31, 2026 and June 30, 2025, the Company and each of its counterparties had been assigned investment grade ratings by both Standard & Poor’s and Moody’s.
Certain of the Company’s exchange traded futures and options contracts used for commodity price risk management include requirements for the Company to post collateral in the form of a cash margin account held by the Company’s broker for trades conducted on that exchange. As of both March 31, 2026 and June 30, 2025, the Company maintained cash margin balances related to exchange traded futures and options contracts of $0 and $2 , respectively, which are classified as Prepaid expenses and other current assets on the condensed consolidated balance sheets.
Trust Assets
The Company holds interests in mutual funds and cash equivalents as part of trust assets related to its nonqualified deferred compensation plans. The participants in the nonqualified deferred compensation plans, who are the Company’s current and former employees, may select among certain mutual funds in which their compensation deferrals are invested in accordance with the terms of the plans and within the confines of the trusts, which hold the marketable securities. The trusts represent variable interest entities for which the Company is considered the primary beneficiary, and therefore trust assets are consolidated and included in Other assets in the condensed consolidated balance sheets. The gains and losses on the trust assets are recorded in Other (income) expense, net in the condensed consolidated statements of earnings and comprehensive income. The interests in mutual funds are measured at fair value using quoted market prices. The Company has designated these marketable securities as trading investments.
Fair Value of Financial Instruments
Financial assets and liabilities measured at fair value on a recurring basis in the condensed consolidated balance sheets are required to be classified and disclosed in one of the following three categories of the fair value hierarchy:
Level 1: Quoted market prices in active markets for identical assets or liabilities.
Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data.
Level 3: Unobservable inputs reflecting the reporting entity’s own assumptions.
As of both March 31, 2026 and June 30, 2025, the Company’s financial assets and liabilities that were measured at fair value on a recurring basis during the period included derivative financial instruments, which were classified as either Level 1 or Level 2, and trust assets to fund the Company’s nonqualified deferred compensation plans, which were classified as Level 1.
11
NOTE 7. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued)
All of the Company’s derivative instruments qualify for hedge accounting. The following table provides information about the balance sheet classification and the fair values of the Company’s derivative instruments:
| 3/31/2026 | 6/30/2025 | ||||||||||||||||||||||||||||||||||
| Balance sheet classification | Fair value hierarchy level | Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | ||||||||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||||||||
| Commodity purchase futures contracts | Prepaid expenses and other current assets | 1 | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Commodity purchase swaps contracts | Prepaid expenses and other current assets | 2 | |||||||||||||||||||||||||||||||||
| Commodity purchase futures contracts | Other assets | 1 | |||||||||||||||||||||||||||||||||
| Foreign exchange forward contracts | Prepaid expenses and other current assets | 2 | |||||||||||||||||||||||||||||||||
| Interest rate forward contracts | Prepaid expenses and other current assets | 2 | |||||||||||||||||||||||||||||||||
| $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Liabilities | |||||||||||||||||||||||||||||||||||
| Commodity purchase swaps contracts | Accounts payable and accrued liabilities | 2 | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Foreign exchange forward contracts | Accounts payable and accrued liabilities | 2 | |||||||||||||||||||||||||||||||||
| $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
The following table provides information about the balance sheet classification and the fair values of the Company’s other assets and liabilities for which disclosure of fair value is required:
| 3/31/2026 | 6/30/2025 | ||||||||||||||||||||||||||||||||||
| Balance sheet classification | Fair value hierarchy level | Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | ||||||||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||||||||
| Interest-bearing investments, including money market funds | Cash and cash equivalents (1) | 1 | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Time deposits | Cash and cash equivalents (1) | 2 | |||||||||||||||||||||||||||||||||
| Trust assets for nonqualified deferred compensation plans | Other assets | 1 | |||||||||||||||||||||||||||||||||
| $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Liabilities | |||||||||||||||||||||||||||||||||||
| Notes and loans payable | Notes and loans payable (2) | 2 | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Long-term debt | Long-term debt (3) | 2 | |||||||||||||||||||||||||||||||||
| $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
(1)Cash and cash equivalents are composed of time deposits and other interest-bearing investments, including money market funds with original maturity dates of 90 days or less. Cash and cash equivalents are recorded at cost, which approximates fair value.
(2)Notes and loans payable are composed of outstanding U.S. commercial paper balances and/or amounts drawn on the Company’s credit agreements, all of which are recorded at cost, which approximates fair value.
(3)Long-term debt is recorded at cost. The fair value of Long-term debt was determined using secondary market prices quoted by corporate bond dealers, and is classified as Level 2.
12
NOTE 8. INCOME TAXES
In determining its quarterly provision for income taxes, the Company uses an estimated annual effective tax rate, which is based on expected annual income, statutory tax rates and tax planning opportunities available in the various jurisdictions in which the Company operates. Certain significant or unusual items are separately recognized in the quarter in which they occur and can be a source of variability in the effective tax rates from quarter to quarter. The effective tax rate on earnings was 25.4 % and 24.9 % for the three and nine months ended March 31, 2026, respectively, and 24.8 % and 26.9 % for the three and nine months ended March 31, 2025, respectively. The higher tax rate in the prior nine month period as compared to the current period was primarily driven by the nondeductibility of the loss on the divestiture of the Better Health VMS business, partially offset by an international legal entity reorganization and favorable stock-based compensation deductions, all in the prior period.
The One Big Beautiful Bill Act (OBBBA) was enacted in the United States on July 4, 2025. This legislation includes provisions that allow accelerated tax deductions for acquisitions of qualified property and for research expenses. It also modifies the U.S. taxation of certain earnings associated with international business. The Company assessed the provisions of the OBBBA and determined the corporate tax changes did not have a material impact on the effective tax rate in future periods. The OBBBA’s provisions for accelerated tax deductions will change the timing of cash tax payments in the current fiscal year and future periods.
NOTE 9. NET EARNINGS PER SHARE (EPS)
The following is the reconciliation of the weighted average number of shares outstanding (in thousands) used to calculate basic net EPS to those used to calculate diluted net EPS:
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
| Basic | |||||||||||||||||||||||
| Dilutive effect of stock options and other | |||||||||||||||||||||||
| Diluted | |||||||||||||||||||||||
| Antidilutive stock options and other | |||||||||||||||||||||||
Basic net earnings per share and Diluted net earnings per share are calculated on Net earnings attributable to Clorox.
NOTE 10. OTHER (INCOME) EXPENSE, NET
The major components of Other (income) expense, net were:
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
| Amortization of trademarks and other intangible assets | $ | $ | $ | $ | |||||||||||||||||||
Trust investment (gains) losses, net | ( | ( | |||||||||||||||||||||
Net periodic benefit (credit) cost | |||||||||||||||||||||||
Foreign exchange transaction losses, net | ( | ||||||||||||||||||||||
| Income from equity investees | ( | ( | |||||||||||||||||||||
| Interest income | ( | ( | ( | ( | |||||||||||||||||||
Cyberattack insurance recoveries (1) | ( | ( | |||||||||||||||||||||
| Other | ( | ( | ( | ||||||||||||||||||||
| Total | $ | $ | ( | $ | $ | ( | |||||||||||||||||
(1)On August 14, 2023, the Company experienced a cyberattack which resulted in wide-scale disruptions to the Company’s business operations. In the three and nine months ended March 31, 2025, the Company recorded insurance recoveries of $(35 ) and $(70 ) respectively, of which $(2 ) and $(5 ) respectively was recorded in Cost of products sold and the remainder was recorded in Other (income) expense, net. Business interruption and other insurance recoveries that do not correspond directly to previously incurred expenses are recognized in Other (income) expense, net. Refer to notes to consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended June 30, 2025 for further information related to the August 2023 Cyberattack.
13
NOTE 11. STOCKHOLDERS ’ EQUITY
Changes in the components of Stockholders’ equity were as follows for the periods indicated:
| Three months ended March 31 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in millions except per share data; shares in thousands) | Common stock | Additional paid-in capital | Retained earnings | Treasury stock | Accumulated other comprehensive net (loss) income | Noncontrolling interests | Total stockholders’ equity | ||||||||||||||||||||||||||||||||||||||||||||||
| Amount | Shares | Amount | Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2024 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Net earnings | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive (loss) income | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Dividends to Clorox stockholders ($ | — | — | — | ( | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Dividends to noncontrolling interests | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Other employee stock plan activities | — | — | ( | ( | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Balance as of March 31, 2025 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2025 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Net earnings | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive (loss) income | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Dividends to Clorox stockholders ($ | — | — | — | ( | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Dividends to noncontrolling interests | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Other employee stock plan activities | — | — | ( | ( | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Balance as of March 31, 2026 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Nine months ended March 31 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions except per share data; shares in thousands) | Common stock | Additional paid-in capital | Retained earnings | Treasury stock | Accumulated other comprehensive net (loss) income | Noncontrolling interests | Total stockholders’ equity | ||||||||||||||||||||||||||||||||||||||||||||||
| Amount | Shares | Amount | Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance as of June 30, 2024 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Net earnings | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive (loss) income | — | — | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
Dividends to Clorox stockholders ($ | — | — | — | ( | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Dividends to noncontrolling interests | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Other employee stock plan activities | — | — | ( | ( | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Treasury stock purchased | — | — | — | — | ( | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Balance as of March 31, 2025 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Balance as of June 30, 2025 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Net earnings | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive (loss) income | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Dividends to Clorox stockholders ($ | — | — | — | ( | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Dividends to noncontrolling interests | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Other employee stock plan activities | — | — | ( | ( | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Treasury stock purchased | — | — | — | — | ( | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Balance as of March 31, 2026 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
14
NOTE 11. STOCKHOLDERS’ EQUITY (Continued)
Changes in Accumulated other comprehensive net (loss) income attributable to Clorox by component were as follows for the periods indicated:
| Three months ended March 31 | |||||||||||||||||||||||
| Foreign currency translation adjustments | Net unrealized gains (losses) on derivatives | Pension and postretirement benefit adjustments | Accumulated other comprehensive net (loss) income | ||||||||||||||||||||
| Balance as of December 31, 2024 | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Other comprehensive (loss) income before reclassifications | |||||||||||||||||||||||
Amounts reclassified from Accumulated other comprehensive net (loss) income | ( | ( | |||||||||||||||||||||
| Income tax benefit (expense) | |||||||||||||||||||||||
| Net current period other comprehensive (loss) income | ( | ||||||||||||||||||||||
| Balance as of March 31, 2025 | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Balance as of December 31, 2025 | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Other comprehensive (loss) income before reclassifications | ( | ||||||||||||||||||||||
Amounts reclassified from Accumulated other comprehensive net (loss) income | ( | ( | |||||||||||||||||||||
Income tax benefit (expense) | ( | ( | |||||||||||||||||||||
| Net current period other comprehensive (loss) income | ( | ||||||||||||||||||||||
| Balance as of March 31, 2026 | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Nine months ended March 31 | |||||||||||||||||||||||
| Foreign currency translation adjustments | Net unrealized gains (losses) on derivatives | Pension and postretirement benefit adjustments | Accumulated other comprehensive net (loss) income | ||||||||||||||||||||
| Balance as of June 30, 2024 | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Other comprehensive (loss) income before reclassifications | ( | ( | ( | ||||||||||||||||||||
Amounts reclassified from Accumulated other comprehensive net (loss) income | ( | ( | ( | ||||||||||||||||||||
| Income tax benefit (expense) | ( | ||||||||||||||||||||||
| Net current period other comprehensive (loss) income | ( | ( | ( | ( | |||||||||||||||||||
| Balance as of March 31, 2025 | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
Balance as of June 30, 2025 | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Other comprehensive (loss) income before reclassifications | |||||||||||||||||||||||
Amounts reclassified from Accumulated other comprehensive net (loss) income | ( | ( | ( | ||||||||||||||||||||
Income tax benefit (expense) | ( | ( | |||||||||||||||||||||
| Net current period other comprehensive (loss) income | ( | ||||||||||||||||||||||
| Balance as of March 31, 2026 | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
15
NOTE 12. OTHER CONTINGENCIES AND GUARANTEES
Contingencies
The Company is involved in certain environmental matters, including response actions at various locations. The Company recorded liabilities totaling $28 and $27 as of March 31, 2026 and June 30, 2025, respectively, for its share of aggregate future remediation costs related to these matters.
One matter, which accounted for $12 30-year period, based on one of the options in the Feasibility Study related to groundwater. In September 2021, as a result of an additional study and further discussions with regulators, the Company submitted a Soil Vapor Intrusion Report to the regulators. In January 2023, the regulators issued a new order directing the Company and the current property owner to conduct a Remedial Investigation and then prepare a Feasibility Study to evaluate and remediate impacts to soil, groundwater, soil vapor and indoor air. While the Company believes its latest estimates of remediation costs (including any related to soil, groundwater, soil vapor and indoor air impacts) are reasonable, the ultimate remediation requirements are not yet finalized and the regulators could require the Company to implement remediation actions for a longer period or take additional actions, which could include estimated undiscounted costs in the aggregate of up to approximately $28 over an estimated 30-year period, or require the Company to take different actions and incur additional costs.
Another matter in Dickinson County, Michigan, at the site of one of the Company’s former operations for which the Company is jointly and severally liable, accounted for $10 24.3 % of the aggregate remediation and associated costs for this matter pursuant to a cost-sharing agreement with a third party. If the third party is unable to pay its share of the response and remediation obligations, the Company may be responsible for such obligations. With the assistance of environmental consultants, the Company maintains an undiscounted liability representing its current best estimate of its share of the capital expenditures, maintenance and other costs that may be incurred over an estimated 30-year remediation period. Although it is reasonably possible that the Company’s exposure may exceed the amount recorded for the Dickinson County matter, any amount of such additional exposures, or range of exposures, is not estimable at this time.
The Company’s estimated losses related to these matters are sensitive to a variety of uncertain factors, including the efficacy of any remediation efforts, changes in any remediation requirements and the future availability of alternative clean-up technologies. From time to time, the Company is subject to various legal proceedings, claims and other loss contingencies, including, without limitation, loss contingencies relating to contractual arrangements (including costs connected to the transition and unwinding of certain supply and manufacturing relationships), product liability, patents and trademarks, advertising, labor and employment, environmental, health and safety and other matters. With respect to these proceedings, claims and other loss contingencies, while considerable uncertainty exists, in the opinion of management at this time, the ultimate disposition of these matters, to the extent not previously provided for, will not have a material adverse effect, either individually or in the aggregate, on the Company’s condensed consolidated financial statements taken as a whole.
Guarantees
In conjunction with divestitures and other transactions, the Company has provided certain indemnifications (e.g., indemnifications for representations and warranties and retention of previously existing environmental, tax and employee liabilities) that have terms that vary in duration and in the potential amount of the total obligation and, in many circumstances, are not explicitly defined. The Company has not made, nor does it believe that it is probable that it will make, any material payments relating to its indemnifications and believes that any reasonably possible payments would not have a material adverse effect, either individually or in the aggregate, on the Company’s condensed consolidated financial statements taken as a whole.
The Company had not recorded any material liabilities on the aforementioned guarantees as of both March 31, 2026 and June 30, 2025.
The Company was a party to letters of credit of $18 as of March 31, 2026, primarily related to its insurance carriers, of which $0 had been drawn upon.
16
NOTE 13. SEGMENT RESULTS
The Company operates through strategic business units (SBUs) which are organized into operating segments. Operating segments are then aggregated into four reportable segments: Health and Wellness, Household, Lifestyle and International. Operating segments not aggregated into a reportable segment are reflected in Corporate and Other.
Corporate and Other includes certain non-allocated administrative and other costs and various other non-operating income and expenses, as well as the results of the Better Health VMS business through the date of divestiture. Assets in Corporate and Other include cash and cash equivalents, prepaid expenses and other current assets, property and equipment, operating lease right-of-use assets, other long-term assets and deferred taxes.
The principal measure of segment profitability used by the Chief Operating Decision Maker (CODM), identified as the Company's Chair and Chief Executive Officer, is segment adjusted earnings (losses) before interest and income taxes (segment adjusted EBIT). Segment adjusted EBIT is defined as earnings (losses) before income taxes excluding interest income, interest expense and other significant items that are nonrecurring or unusual (such as the pension settlement charge, incremental charges and insurance recoveries related to the August 2023 cyberattack, asset impairments, charges related to the digital capabilities and productivity enhancements investment, transaction and integration costs related to acquisitions, significant losses related to divestitures and other nonrecurring or unusual items impacting comparability).
The CODM uses this measure to assess the operating results and performance of its segments, monitor actual results as compared to plan, perform analytical comparisons, identify strategies to improve performance and allocate resources to each segment as it removes the impact of the items that management believes do not directly reflect the performance of each segment’s underlying operations.
Net sales by segment and a reconciliation to the Company’s consolidated net sales for the three and nine months ended March 31:
| Net sales | ||||||||||||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | |||||||||||||||||||||||
| Health and Wellness | $ | $ | $ | $ | ||||||||||||||||||||||
| Household | ||||||||||||||||||||||||||
| Lifestyle | ||||||||||||||||||||||||||
| International | ||||||||||||||||||||||||||
Reportable segment total | $ | $ | $ | $ | ||||||||||||||||||||||
| Corporate and Other | ( | ( | ||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||
All intersegment sales are eliminated and are not included in the Company’s reportable segments’ net sales.
17
NOTE 13. SEGMENT RESULTS (Continued)
Segment adjusted EBIT, including the significant segment expense provided to the CODM, and a reconciliation to earnings before income taxes for the three and nine months ended March 31:
| Segment adjusted earnings (losses) before interest and income taxes | |||||||||||||||||||||||||||||
| Three months ended March 31, 2026 | |||||||||||||||||||||||||||||
Health and Wellness | Household | Lifestyle | International | Total | |||||||||||||||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||||||||||||||||
Cost of products sold | |||||||||||||||||||||||||||||
Other segment items (1) | |||||||||||||||||||||||||||||
Segment adjusted EBIT | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Corporate and Other | ( | ||||||||||||||||||||||||||||
| Interest income | |||||||||||||||||||||||||||||
| Interest expense | ( | ||||||||||||||||||||||||||||
Acquisition and integration costs (2) | ( | ||||||||||||||||||||||||||||
Digital capabilities and productivity enhancements investment (3) | ( | ||||||||||||||||||||||||||||
Earnings before income taxes | $ | ||||||||||||||||||||||||||||
| Segment adjusted earnings (losses) before interest and income taxes | |||||||||||||||||||||||||||||
| Nine months ended March 31, 2026 | |||||||||||||||||||||||||||||
Health and Wellness | Household | Lifestyle | International | Total | |||||||||||||||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||||||||||||||||
Cost of products sold | |||||||||||||||||||||||||||||
Other segment items (1) | |||||||||||||||||||||||||||||
Segment adjusted EBIT | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Corporate and Other | ( | ||||||||||||||||||||||||||||
| Interest income | |||||||||||||||||||||||||||||
| Interest expense | ( | ||||||||||||||||||||||||||||
Acquisition and integration costs (2) | ( | ||||||||||||||||||||||||||||
Digital capabilities and productivity enhancements investment (3) | ( | ||||||||||||||||||||||||||||
Earnings before income taxes | $ | ||||||||||||||||||||||||||||
(1)Other segment items includes selling and administrative expenses, advertising costs, research and development costs and other income and expenses. The items defined in segment adjusted EBIT above are excluded from other segment items and Corporate and Other.
(2)Represents the expenses related to the Company’s acquisition and integration of GOJO corresponding to Corporate and Other. See Note 14 for additional details related to the acquisition.
(3)Represents expenses related to the Company’s digital capabilities and productivity enhancements investment corresponding to Corporate and Other.
18
NOTE 13. SEGMENT RESULTS (Continued)
| Segment adjusted earnings (losses) before interest and income taxes | |||||||||||||||||||||||||||||
| Three months ended March 31, 2025 | |||||||||||||||||||||||||||||
Health and Wellness | Household | Lifestyle | International | Total | |||||||||||||||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||||||||||||||||
Cost of products sold | |||||||||||||||||||||||||||||
Other segment items (1) | |||||||||||||||||||||||||||||
Segment adjusted EBIT | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Corporate and Other | ( | ||||||||||||||||||||||||||||
| Interest income | |||||||||||||||||||||||||||||
| Interest expense | ( | ||||||||||||||||||||||||||||
Loss on divestiture (2) | |||||||||||||||||||||||||||||
Cyberattack costs, net of insurance recoveries (3) | |||||||||||||||||||||||||||||
Digital capabilities and productivity enhancements investment (4) | ( | ||||||||||||||||||||||||||||
Earnings before income taxes | $ | ||||||||||||||||||||||||||||
| Segment adjusted earnings (losses) before interest and income taxes | |||||||||||||||||||||||||||||
| Nine months ended March 31, 2025 | |||||||||||||||||||||||||||||
Health and Wellness | Household | Lifestyle | International | Total | |||||||||||||||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||||||||||||||||
Cost of products sold | |||||||||||||||||||||||||||||
Other segment items (1) | |||||||||||||||||||||||||||||
Segment adjusted EBIT | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Corporate and Other | ( | ||||||||||||||||||||||||||||
| Interest income | |||||||||||||||||||||||||||||
| Interest expense | ( | ||||||||||||||||||||||||||||
Loss on divestiture (2) | ( | ||||||||||||||||||||||||||||
Cyberattack costs, net of insurance recoveries (3) | |||||||||||||||||||||||||||||
Digital capabilities and productivity enhancements investment (4) | ( | ||||||||||||||||||||||||||||
Earnings before income taxes | $ | ||||||||||||||||||||||||||||
(1)Other segment items includes selling and administrative expenses, advertising costs, research and development costs and other income and expenses. The items defined in segment adjusted EBIT above are excluded from other segment items and Corporate and Other.
(2)Represents the loss on divestiture of the Better Health VMS business corresponding to Corporate and Other. See Note 3 for additional details related to the divestiture.
(3)Represents insurance recoveries related to the cyberattack corresponding to Corporate and Other. See Note 10 for further discussion.
(4)Represents expenses related to the Company’s digital capabilities and productivity enhancements investment corresponding to Corporate and Other.
19
NOTE 13. SEGMENT RESULTS (Continued)
Certain other segment disclosures were as follows:
| Health and Wellness | Household | Lifestyle | International | Corporate and Other | Total Company | |||||||||||||||||||||
| Total assets | ||||||||||||||||||||||||||
Balance as of 3/31/2026 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||
Balance as of 6/30/2025 | ||||||||||||||||||||||||||
| (Income) Loss from equity investees included in Other (income) expense, net | ||||||||||||||||||||||||||
| Three months ended 03/31/2026 | ||||||||||||||||||||||||||
| Three months ended 03/31/2025 | ||||||||||||||||||||||||||
| Nine months ended 03/31/2026 | ( | ( | ||||||||||||||||||||||||
| Nine months ended 03/31/2025 | ( | ( | ||||||||||||||||||||||||
| Capital expenditures | ||||||||||||||||||||||||||
| Three months ended 03/31/2026 | ||||||||||||||||||||||||||
| Three months ended 03/31/2025 | ||||||||||||||||||||||||||
| Nine months ended 03/31/2026 | ||||||||||||||||||||||||||
| Nine months ended 03/31/2025 | ||||||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||||
Three months ended 3/31/2026 | ||||||||||||||||||||||||||
Three months ended 3/31/2025 | ||||||||||||||||||||||||||
| Nine months ended 03/31/2026 | ||||||||||||||||||||||||||
| Nine months ended 03/31/2025 | ||||||||||||||||||||||||||
Significant noncash charges included in earnings before interest and income taxes: | ||||||||||||||||||||||||||
| Stock-based compensation | ||||||||||||||||||||||||||
Three months ended 3/31/2026 | ||||||||||||||||||||||||||
Three months ended 3/31/2025 | ||||||||||||||||||||||||||
| Nine months ended 03/31/2026 | ||||||||||||||||||||||||||
| Nine months ended 03/31/2025 | ||||||||||||||||||||||||||
20
NOTE 13. SEGMENT RESULTS (Continued)
Net sales to the Company’s largest customer, Walmart Inc. and its affiliates, as a percentage of consolidated net sales, was 28 % and 27 % for the three and nine months ended March 31, 2026, respectively, and 27 % and 26 % for the three and nine months ended March 31, 2025, respectively.
The following table provides Net sales as a percentage of the Company’s consolidated net sales, disaggregated by operating segment, for the periods indicated:
| Net sales | |||||||||||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
| Cleaning | % | % | % | % | |||||||||||||||||||
| Professional Products | |||||||||||||||||||||||
| Health and Wellness | % | % | % | % | |||||||||||||||||||
| Bags and Wraps | |||||||||||||||||||||||
| Cat Litter | |||||||||||||||||||||||
| Grilling | |||||||||||||||||||||||
| Household | % | % | % | % | |||||||||||||||||||
| Food | |||||||||||||||||||||||
| Water Filtration | |||||||||||||||||||||||
| Natural Personal Care | |||||||||||||||||||||||
| Lifestyle | % | % | % | % | |||||||||||||||||||
| International | % | % | % | % | |||||||||||||||||||
| Corporate and Other | % | % | % | % | |||||||||||||||||||
| Total Company | % | % | % | % | |||||||||||||||||||
NOTE 14. SUBSEQUENT EVENTS
On April 1, 2026, the Company completed the previously announced acquisition of GOJO, makers of Purell and a leader of skin health and hygiene solutions. The Company acquired all of the issued and outstanding membership interests of GOJO, which is based in northeast Ohio. The acquisition reflects the Company's strategy to expand its position in health and hygiene and accelerate profitable growth.
The acquisition was completed for a purchase price of approximately $2,250 , but may ultimately be adjusted for indebtedness assumed, cash acquired and working capital and other adjustments. To finance the acquisition, the Company drew down $1,250 from the Delayed Draw Term Credit Agreement and used cash from commercial paper borrowings issued prior to March 31, 2026; see Note 6 for further details.
The GOJO acquisition will be accounted for as a business combination under the acquisition method of accounting with the purchase price allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values at the acquisition date. Due to the limited time since the closing of the transaction, the Company is in the process of completing its initial fair value estimates, which will be disclosed in the fourth quarter of fiscal year 2026. The Company expects the majority of the purchase price to be allocated to Goodwill, Trademarks, net and Other intangible assets, net.
21
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The Clorox Company
(Dollars in millions, except per share data)
(Dollars in millions, except per share data)
Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) is designed to provide a reader of The Clorox Company’s (the Company or Clorox) financial statements with a narrative from the perspective of management on the Company’s financial condition, results of operations, liquidity and certain other factors that may affect future results. The following discussion of the Company’s financial condition and results of operations should be read in conjunction with MD&A and the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025, which was filed with the SEC on August 8, 2025, and the unaudited condensed consolidated financial statements and related notes contained in this Quarterly Report on Form 10-Q (this Report). Unless otherwise noted, MD&A compares the three and nine month period ended March 31, 2026 (the current period) to the three and nine month period ended March 31, 2025 (the prior period), with percentage and basis point calculations based on rounded numbers, except for per share data and the effective tax rate.
EXECUTIVE OVERVIEW
The Clorox Company is a leading multinational manufacturer and marketer of consumer and professional products with approximately 7,600 employees worldwide. The Company has operations in approximately 25 countries or territories and sells its products in approximately 100 markets, primarily through mass retailers; grocery outlets; warehouse clubs; dollar stores; home hardware centers; drug, pet and military stores; third-party and owned e-commerce channels; and distributors. Clorox markets some of the most trusted and recognized consumer brand names, including its namesake bleach, cleaning and disinfecting products, Pine-Sol® and Tilex® cleaners; Liquid-Plumr® clog removers; Poett® home care products; Glad® bags and wraps; Fresh Step® cat litter; Kingsford® grilling products; Hidden Valley® dressings, dips, seasonings and sauces; Brita® water-filtration products; and Burt’s Bees® natural personal care products. The Company also markets industry-leading products and technologies for professional customers, including those sold under the CloroxPro™ and Clorox Healthcare® brand names.
The Company primarily markets its leading brands in midsized categories considered to be financially attractive. Most of the Company’s products compete with other nationally advertised brands within each category and with “private label” brands. About 80% of the Company’s sales are generated from brands that hold the No. 1 or No. 2 market share position in their categories.
The Company operates through strategic business units (SBUs) which are organized into operating segments. Operating segments are then aggregated into four reportable segments: Health and Wellness, Household, Lifestyle and International. Operating segments not aggregated into a reportable segment are reflected in Corporate and Other. The four reportable segments consist of the following:
•Health and Wellness consists of cleaning, disinfecting and professional products marketed and sold in the United States. Products within this segment include home care, cleaning and disinfecting products and laundry additives, primarily under the Clorox®, Clorox2®, Pine-Sol, Scentiva®, Tilex, Liquid-Plumr, and Formula 409® brands; professional cleaning and disinfecting products under the CloroxPro and Clorox Healthcare brands; and professional food service products under the Hidden Valley brand.
•Household consists of bags and wraps, cat litter and grilling products marketed and sold in the United States. Products within this segment include bags and wraps under the Glad brand; cat litter, primarily under the Fresh Step and Scoop Away® brands; and grilling products under the Kingsford brand.
•Lifestyle consists of food, water filtration and natural personal care products marketed and sold in the United States. Products within this segment include dressings, dips, seasonings and sauces, primarily under the Hidden Valley brand; water-filtration products under the Brita brand; and natural personal care products under the Burt’s Bees brand.
•International consists of products sold outside the United States. Products within this segment include laundry additives and home care products, primarily marketed under the Clorox, Poett, Pine-Sol and Clorinda brands; bags and wraps under the Glad brand; cat litter, primarily marketed under the Ever Clean® and Fresh Step brands and water-filtration products marketed under the Brita brand.
22
RECENT EVENTS AFFECTING THE COMPANY
For the fiscal quarter ended March 31, 2026, the Company continues to monitor macroeconomic conditions as a result of volatility in capital markets and developments in international trade policy. These evolving challenges contributed to a highly dynamic operating environment as the Company continued its efforts to drive growth, rebuild margins and drive its transformation.
Consumers continue to feel pressure as continued macroeconomic uncertainty impacts spending and prices remain elevated. United States trade policies continue to evolve, including new or increased tariffs on product imports from certain countries. These, and any future new or additional tariffs, as well as any associated retaliatory measures taken by other countries, may impact the macroeconomic environment, consumers, suppliers and the Company’s business. Though the Company has and will continue to take action to mitigate such impacts, the Company anticipates that the operating environment will remain volatile and challenging.
Global macroeconomic conditions remain volatile and geopolitical instability persists. This includes active military hostilities in the Middle East, specifically the ongoing conflict involving Iran, rising tensions in other regions, as well as actual and potential shifts in U.S. and foreign trade, economic and other policies, including the imposition of sanctions. These developments have increased uncertainty regarding the duration and potential escalation of conflicts, as well as the risk of economic disruptions that could impact global trade and supply chains. Given the dynamic nature of these conditions, the Company expects continued variability in the operating environment.
The Company has not experienced significant disruptions to its regional operations and global supply chain or significant cost increases during fiscal year 2026 to date due to the ongoing conflict involving Iran. However, the risks of future negative impacts from regional conflicts due to transportation, logistical or supply constraints and higher commodity costs for certain raw materials remain present, and the Company expects to experience corresponding incremental costs and gross margin pressures in future periods.
The Company's transformation efforts continued into fiscal year 2026. The Company has continued transitioning core U.S. operations to the new enterprise resource planning system (ERP) as part of the phased implementation of its technology transformation. The Company remains in the stabilization phase and completed its implementation in the third quarter of fiscal year 2026. The total incremental transformational investment was approximately $580 million. The digital foundation provided by the Company’s new ERP supports its long-term financial goals through modernized capabilities that accelerate growth and deliver stronger efficiencies.
The Company will continue to invest in its brands, capabilities and people to deliver consistent, profitable growth over time. The acquisition of GOJO Industries, Inc. (GOJO), which closed on April 1, 2026, and the completed purchase of The Procter & Gamble Company’s (P&G) interest in the venture agreement for the Company’s Glad bags and wraps business (the Venture Agreement) on March 2, 2026 reflect the Company’s intent to continue evolving its portfolio to deliver long‑term value for shareholders.
For the remainder of fiscal year 2026, the Company anticipates that the operating environment will remain volatile and challenging as consumers may face greater pressure as continued macroeconomic uncertainty impacts spending. The Company will continue to invest in its brands, capabilities and people to deliver consistent, profitable growth over time.
For further discussion, refer to Item 1.A, “Risk Factors” of this report and “Risk Factors” included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025.
23
RESULTS OF OPERATIONS
CONSOLIDATED RESULTS
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | % Change | 3/31/2026 | 3/31/2025 | % Change | ||||||||||||||||||||||||||||||
| Net sales | $ | 1,670 | $ | 1,668 | — | % | $ | 4,772 | $ | 5,116 | (7) | % | |||||||||||||||||||||||
| Three months ended March 31, 2026 | ||||||||||||||||||||||||||
| Percentage change versus the year-ago period | ||||||||||||||||||||||||||
| Reported (GAAP) Net Sales Growth / (Decrease) | Reported Volume | Acquisitions & Divestitures | Foreign Exchange Impact | Price/Mix/ Other (2) | Organic Sales Growth / (Decrease) (Non-GAAP)(3) | Organic Volume (4) | ||||||||||||||||||||
| Health and Wellness | — | % | 1 | % | — | % | — | % | (1) | % | — | % | 1 | % | ||||||||||||
| Household | 3 | 3 | — | — | — | 3 | 3 | |||||||||||||||||||
| Lifestyle | (9) | (6) | — | — | (3) | (9) | (6) | |||||||||||||||||||
| International | 8 | 2 | — | 6 | — | 2 | 2 | |||||||||||||||||||
Total Company (5) | — | % | — | % | — | % | 1 | % | (1) | % | (1) | % | — | % | ||||||||||||
| Nine months ended March 31, 2026 | ||||||||||||||||||||||||||
| Percentage change versus the year-ago period | ||||||||||||||||||||||||||
| Reported (GAAP) Net Sales Growth / (Decrease) | Reported Volume | Acquisitions & Divestitures (1) | Foreign Exchange Impact | Price/Mix/ Other (2) | Organic Sales Growth / (Decrease) (Non-GAAP) (3) | Organic Volume (4) | ||||||||||||||||||||
| Health and Wellness | (6) | % | (5) | % | — | % | — | % | (1) | % | (6) | % | (5) | % | ||||||||||||
| Household | (7) | (6) | — | — | (1) | (7) | (6) | |||||||||||||||||||
| Lifestyle | (13) | (11) | — | — | (2) | (13) | (11) | |||||||||||||||||||
| International | 5 | 1 | — | 3 | 1 | 2 | 1 | |||||||||||||||||||
Total Company (4)(5) | (7) | % | (6) | % | (1) | % | — | % | (1) | % | (6) | % | (5) | % | ||||||||||||
(1)The divestiture impact is calculated as net sales from the Better Health VMS business after the sale date in the nine month year-ago period.
(2)This represents the net impact on net sales growth / (decrease) from pricing actions, mix, trade promotion spending, mix from acquisitions and divestitures and other factors. In the nine months ended March 31, 2026, the impact from divestiture mix was 0% for Total Company.
(3)Organic sales growth / (decrease) is defined as net sales growth / (decrease) excluding the effect of any acquisitions and divestitures and foreign exchange rate changes. See “Non-GAAP Financial Measures” below for reconciliation of organic sales growth / (decrease) to net sales growth / (decrease), the most directly comparable GAAP financial measure.
(4)Organic volume represents volume excluding the effect of any acquisitions and divestitures. In the nine months ended March 31, 2026, the volume impact of divestitures was (1)% for Total Company.
(5)Total Company includes Corporate and Other. Corporate and Other includes the results of the Better Health VMS business through the date of divestiture.
Net sales and volume in the current three month period were both essentially flat.
Net sales and volume in the current nine month period decreased by 7% and 6%, respectively, primarily due to lower shipments in the current period following the incremental shipments related to the ERP transition in the fourth quarter of fiscal year 2025.
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | % Change | 3/31/2026 | 3/31/2025 | % Change | ||||||||||||||||||||||||||||||
| Gross profit | $ | 722 | $ | 744 | (3) | % | $ | 2,040 | $ | 2,289 | (11) | % | |||||||||||||||||||||||
| Gross margin | 43.2 | % | 44.6 | % | 42.7 | % | 44.7 | % | |||||||||||||||||||||||||||
24
RESULTS OF OPERATIONS (Continued)
Gross margin decreased by 140 basis points in the current three month period from 44.6% to 43.2%. The decrease was primarily driven by higher manufacturing and logistics costs and unfavorable mix, partially offset by cost savings.
Gross margin decreased by 200 basis points in the current nine month period from 44.7% to 42.7%. The decrease was primarily driven by higher manufacturing and logistics costs and lower volume, partially offset by cost savings.
Expenses
| Three months ended | |||||||||||||||||||||||||||||
| % of Net Sales | |||||||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | % Change | 3/31/2026 | 3/31/2025 | |||||||||||||||||||||||||
| Selling and administrative expenses | $ | 229 | $ | 267 | (14) | % | 13.7 | % | 16.0 | % | |||||||||||||||||||
| Advertising costs | 177 | 207 | (14) | 10.6 | 12.4 | ||||||||||||||||||||||||
| Research and development costs | 27 | 27 | — | 1.6 | 1.6 | ||||||||||||||||||||||||
| Nine months ended | |||||||||||||||||||||||||||||
| % of Net Sales | |||||||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | % Change | 3/31/2026 | 3/31/2025 | |||||||||||||||||||||||||
| Selling and administrative expenses | $ | 768 | $ | 828 | (7) | % | 16.1 | % | 16.2 | % | |||||||||||||||||||
| Advertising costs | 533 | 599 | (11) | 11.2 | 11.7 | ||||||||||||||||||||||||
| Research and development costs | 84 | 89 | (6) | 1.8 | 1.7 | ||||||||||||||||||||||||
Selling and administrative expenses, as a percentage of net sales, decreased by 230 basis points and 10 basis points in the current three and nine month periods, respectively, versus the prior periods. The dollar decrease in selling and administrative expenses in both the current three and nine month periods was primarily due to lower costs related to the Company’s digital capabilities and productivity enhancements investment and lower incentive compensation.
Advertising costs, as a percentage of net sales, decreased by 180 basis points and 50 basis points in the current three and nine month periods, respectively, versus the prior periods. The Company continues to support its brands. The Company’s U.S. retail advertising investments as a percentage of net sales decreased from 14% to 11% in the current three month period.
Research and development costs, both as a percentage of net sales and dollars, were essentially flat in both the current three and nine month periods as compared to prior periods. The Company continues to invest in product innovation and cost savings.
Loss on divestiture, interest expense, other (income) expense, net and the effective tax rate on earnings
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
| Loss on divestiture | $ | — | $ | — | $ | — | $ | 118 | |||||||||||||||
| Interest expense | 27 | 23 | 75 | 66 | |||||||||||||||||||
| Other (income) expense, net | 6 | (34) | 2 | (79) | |||||||||||||||||||
Effective tax rate on earnings | 25.4 | % | 24.8 | % | 24.9 | % | 26.9 | % | |||||||||||||||
Loss on divestiture of $118 in the prior nine month period reflects the loss on the divestiture of the Better Health VMS business. See notes to condensed consolidated financial statements for further information.
Other (income) expense, net was $6 and ($34) in the current and prior three month periods, respectively, and $2 and ($79) in the current and prior nine month periods, respectively. The variance between both the current and prior three and nine month periods was primarily due to lapping the benefit of insurance recoveries mainly related to the cyberattack in fiscal year 2024.
The effective tax rate on earnings was 25.4% and 24.9% for the current three and nine month periods, respectively and 24.8% and 26.9% for the prior three and nine months periods, respectively. The higher tax rate in the prior nine month period as compared to the current period was primarily driven by the nondeductibility of the loss on the divestiture of the Better Health VMS business, partially offset by an international legal entity reorganization and favorable stock-based compensation deductions, all in the prior period.
25
RESULTS OF OPERATIONS (Continued)
Diluted net earnings per share
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | % Change | 3/31/2026 | 3/31/2025 | % Change | ||||||||||||||||||||||||||||||
Diluted net earnings per share | $ | 1.54 | $ | 1.50 | 3 | % | $ | 3.47 | $ | 3.84 | (10) | % | |||||||||||||||||||||||
Diluted net earnings per share (EPS) increased by $0.04, or 3%, in the current three month period, primarily due to cost savings and lower selling and administrative expenses, partially offset by higher manufacturing and logistics costs in the current period and lapping insurance recoveries in the prior period.
Diluted EPS decreased by $0.37, or 10%, in the current nine month period, primarily due to lower net sales and higher manufacturing and logistics costs in the current period and lapping insurance recoveries in the prior period, partially offset by lapping losses on the divestiture of the Better Health VMS business in the prior period and higher cost savings in the current period.
SEGMENT RESULTS
The following presents the results of the Company’s reportable segments and Corporate and Other. See notes to condensed consolidated financial statements for further discussion of the principal measure of segment profitability used by management, segment adjusted earnings (losses) before interest and income taxes (segment adjusted EBIT):
| Net sales | |||||||||||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
| Health and Wellness | $ | 629 | $ | 630 | $ | 1,837 | $ | 1,956 | |||||||||||||||
| Household | 482 | 469 | 1,263 | 1,362 | |||||||||||||||||||
| Lifestyle | 277 | 306 | 843 | 964 | |||||||||||||||||||
| International | 285 | 263 | 832 | 796 | |||||||||||||||||||
Reportable segment total | 1,673 | 1,668 | 4,775 | 5,078 | |||||||||||||||||||
| Corporate and Other | (3) | — | (3) | 38 | |||||||||||||||||||
| Total | $ | 1,670 | $ | 1,668 | $ | 4,772 | $ | 5,116 | |||||||||||||||
Segment adjusted EBIT (1) | |||||||||||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
| Health and Wellness | $ | 158 | $ | 169 | $ | 472 | $ | 597 | |||||||||||||||
| Household | 74 | 61 | 123 | 169 | |||||||||||||||||||
| Lifestyle | 60 | 60 | 170 | 196 | |||||||||||||||||||
| International | 36 | 31 | 86 | 87 | |||||||||||||||||||
Reportable segment total | 328 | 321 | 851 | 1,049 | |||||||||||||||||||
| Corporate and Other | (32) | (55) | (139) | (193) | |||||||||||||||||||
| Total | $ | 296 | $ | 266 | $ | 712 | $ | 856 | |||||||||||||||
| Interest income | 4 | 2 | 7 | 7 | |||||||||||||||||||
| Interest expense | (27) | (23) | (75) | (66) | |||||||||||||||||||
Loss on divestiture | — | — | — | (118) | |||||||||||||||||||
Acquisition and integration costs | (7) | — | (7) | — | |||||||||||||||||||
Cyberattack costs, net of insurance recoveries | — | 35 | — | 70 | |||||||||||||||||||
| Digital capabilities and productivity enhancements investment | (10) | (26) | (59) | (81) | |||||||||||||||||||
Earnings before income taxes | $ | 256 | $ | 254 | $ | 578 | $ | 668 | |||||||||||||||
26
SEGMENT RESULTS (Continued)
(1)See “Non-GAAP Financial Measures” below for reconciliation of segment adjusted EBIT to earnings before income taxes, the most directly comparable GAAP financial measure.
Health and Wellness
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | % Change | 3/31/2026 | 3/31/2025 | % Change | ||||||||||||||||||||||||||||||
| Net sales | $ | 629 | $ | 630 | — | % | $ | 1,837 | $ | 1,956 | (6) | % | |||||||||||||||||||||||
| Segment adjusted EBIT | 158 | 169 | (7) | 472 | 597 | (21) | |||||||||||||||||||||||||||||
Volume increased by 1%, net sales were essentially flat and segment adjusted EBIT decreased by 7% during the current three month period. The decrease in segment adjusted EBIT was primarily due to higher manufacturing and logistics costs, partially offset by cost savings.
Volume, net sales and segment adjusted EBIT decreased by 5%, 6% and 21%, respectively, during the current nine month period. The volume decrease was primarily due to lower shipments in the current period following the incremental shipments related to the ERP transition in the fourth quarter of fiscal year 2025. The decrease in segment adjusted EBIT was primarily due to lower net sales and higher manufacturing and logistics costs, partially offset by cost savings.
Household
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | % Change | 3/31/2026 | 3/31/2025 | % Change | ||||||||||||||||||||||||||||||
| Net sales | $ | 482 | $ | 469 | 3 | % | $ | 1,263 | $ | 1,362 | (7) | % | |||||||||||||||||||||||
| Segment adjusted EBIT | 74 | 61 | 21 | 123 | 169 | (27) | |||||||||||||||||||||||||||||
Both volume and net sales increased by 3% and segment adjusted EBIT increased by 21% during the current three month period. The volume increase was primarily due to shipment ahead of consumption in Cat Litter and Grilling. The increase in segment adjusted EBIT was mainly due to cost savings.
Volume, net sales and segment adjusted EBIT decreased by 6%, 7% and 27%, respectively, during the current nine month period. The volume decrease was primarily due to lower shipments in the current period following the incremental shipments related to the ERP transition in the fourth quarter of fiscal year 2025. The decrease in segment adjusted EBIT was mainly due to lower net sales and higher manufacturing and logistics costs, partially offset by cost savings.
Lifestyle
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | % Change | 3/31/2026 | 3/31/2025 | % Change | ||||||||||||||||||||||||||||||
| Net sales | $ | 277 | $ | 306 | (9) | % | $ | 843 | $ | 964 | (13) | % | |||||||||||||||||||||||
| Segment adjusted EBIT | 60 | 60 | — | 170 | 196 | (13) | |||||||||||||||||||||||||||||
Volume and net sales decreased by 6% and 9%, respectively, and segment adjusted EBIT was essentially flat, during the current three month period. The volume decrease was primarily due to lower consumption. The variance between volume and net sales was mainly due to higher trade promotion spending. Segment adjusted EBIT was essentially flat primarily due to lower net sales offset by lower advertising investments and lower selling and administrative expenses.
Volume decreased by 11% and both net sales and segment adjusted EBIT decreased by 13% during the current nine month period. The volume decrease was primarily due to lower shipments in the current period following the incremental shipments related to the ERP transition in the fourth quarter of fiscal year 2025. The variance between volume and net sales was mainly due to higher trade promotion spending. The decrease in segment adjusted EBIT was primarily due to lower net sales, partially offset by lower advertising investments and cost savings.
27
SEGMENT RESULTS (Continued)
International
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | % Change | 3/31/2026 | 3/31/2025 | % Change | ||||||||||||||||||||||||||||||
| Net sales | $ | 285 | $ | 263 | 8 | % | $ | 832 | $ | 796 | 5 | % | |||||||||||||||||||||||
| Segment adjusted EBIT | 36 | 31 | 16 | 86 | 87 | (1) | |||||||||||||||||||||||||||||
Volume, net sales, and segment adjusted EBIT increased by 2%, 8%, and 16%, respectively, during the current three month period. The volume increase was primarily driven by strong shipments in Asia. The variance between volume and net sales was mainly due to favorable foreign exchange rates. The increase in segment adjusted EBIT was primarily due to higher net sales and cost savings, partially offset by higher manufacturing and logistics costs.
Volume and net sales increased by 1% and 5%, respectively, and segment adjusted EBIT decreased by 1% in the current nine month period. The variance between volume and net sales was mainly due to favorable foreign exchange rates and favorable price mix. The decrease in segment adjusted EBIT was primarily due to higher manufacturing and logistics costs, partially offset by higher net sales and cost savings.
Corporate and Other
Corporate and Other includes certain non-allocated administrative and other costs, various other non-operating income and expenses, as well as the results of the Better Health VMS business, through the date of divestiture.
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | % Change | 3/31/2026 | 3/31/2025 | % Change | ||||||||||||||||||||||||||||||
Net Sales | $ | (3) | $ | — | (100) | % | $ | (3) | $ | 38 | (108) | % | |||||||||||||||||||||||
| Segment adjusted EBIT | (32) | (55) | 42 | (139) | (193) | 28 | |||||||||||||||||||||||||||||
Net sales decreased by 108% in the current nine month period primarily due to the divestiture of the Better Health VMS business in the first quarter of fiscal year 2025.
Segment adjusted EBIT increased by 42% and 28% in the current three month and nine month periods, respectively. The increase in segment adjusted EBIT in the current three month period was primarily due to decreases in employee-related expenses primarily due to lower employee incentive compensation. The increase in segment adjusted EBIT in the current nine month period was primarily due to decreases in employee-related expenses primarily due to lower employee incentive compensation and lower Better Health VMS operating expenses in the current period due to the divestiture.
In the first quarter of fiscal year 2025, the Company completed the divestiture of its Better Health VMS business. See notes to condensed consolidated financial statements for further information.
FINANCIAL POSITION AND LIQUIDITY
The Company’s financial condition and liquidity remained strong as of March 31, 2026. The following table summarizes cash activities:
| Nine months ended | |||||||||||
| 3/31/2026 | 3/31/2025 | ||||||||||
| Net cash provided by operations | $ | 282 | $ | 687 | |||||||
Net cash used for investing activities | (120) | (18) | |||||||||
Net cash provided by (used for) financing activities | 857 | (645) | |||||||||
Operating Activities
Net cash provided by operations was $282 in the current nine month period, compared with $687 in the prior nine month period. The decrease was primarily driven by the Venture Agreement termination payment of $476 and lower cash earnings offset by lower working capital and lower tax payments in the current nine month period. The lower Accounts receivable balance in current period was primarily due to the incremental shipments related to the ERP transition in the fourth quarter of fiscal year 2025. The higher Accounts payable and accrued liabilities balance was due to the timing of payments.
28
FINANCIAL POSITION AND LIQUIDITY (Continued)
Payment Terms Extension and Supply Chain Financing
The Company has arranged for a global financial institution to offer a voluntary supply chain finance (SCF) program for the benefit of the Company’s suppliers. The Company’s current payment terms do not exceed 120 days in keeping with industry standards. The Company’s operating cash flows are directly impacted as a result of the extension of payment terms with suppliers. There would not be an expected material impact to the Company’s liquidity or capital resources if the financial institution or a supplier terminated the SCF arrangement. While the Company does not have direct access to information on, or influence over, which invoices a participating supplier elects to sell to the financial institution, the Company expects that the majority of these amounts have been sold to the financial institution. Refer to the notes to condensed consolidated financial statements for detail on the SCF program.
Investing Activities
Net cash used for investing activities was $120 in the current nine month period, compared with $18 in the prior nine month period. The year-over-year change was mainly due to net proceeds from the sale of the Better Health VMS business in the prior nine month period.
Financing Activities
Net cash provided by financing activities was $857 in the current nine month period, compared with net cash used of $645 in the prior nine month period. The year-over-year change was mainly due to higher cash sourced from short term borrowings in the current nine month period.
Capital Resources and Liquidity
As of March 31, 2026, current liabilities exceeded current assets by $504, primarily due to commercial paper borrowings used to finance the Company’s Venture Agreement termination payment.
As of March 31, 2026, the Company has issued approximately $1,591 of Notes and loans payable primarily comprised of U.S. commercial paper borrowings to finance the previously announced GOJO acquisition and fund the Venture Agreement termination payment.
Notwithstanding potential unforeseen adverse market conditions and as part of the Company’s regular assessment of its cash needs, the Company believes it will have the funds necessary to support its short- and long-term liquidity and operating needs, including its ability to invest in its brands, capabilities and people to deliver consistent profitable growth over time based on its anticipated ability to generate positive cash flows from operations in the future, access to capital markets enabled by our strong short-term and long-term credit ratings and current borrowing availability.
Venture Agreement
The Company’s Venture Agreement expired on January 31, 2026. The agreement, at its expiration, required the Company to purchase P&G’s 20% interest for cash at fair value as established by predetermined valuation procedures. As of June 30, 2025, P&G had a 20% interest in the venture, and the estimated fair value of P&G’s interest in the venture was $476, of which $501 was recognized and reflected in Accounts payable and accrued liabilities in the Company’s condensed consolidated balance sheet.
On January 31, 2026, the Company and P&G agreed that the Company would purchase P&G’s 20% interest, which was paid in cash for $476 on March 2, 2026.
The Glad business will continue to retain the exclusive core intellectual property licenses contributed by P&G on a royalty-free basis for the licensed products marketed.
See notes to condensed consolidated financial statements for further information.
Credit Arrangements
As of March 31, 2026, the Company maintained $2,200 in revolving credit agreements comprised of a $1,000 364-day revolving credit agreement that matures in March 2027 (the 364-Day Revolving Credit Agreement) and a $1,200 revolving credit agreement that matures in March 2030 (collectively the Revolving Credit Agreements), and a $1,250 term credit agreement that matures in March 2027 (the Delayed Draw Term Credit Agreement).
On March 6, 2026, in connection with the GOJO acquisition, the Company entered into the 364-Day Revolving Credit Agreement and the Delayed Draw Term Credit Agreement. Amounts available under the 364-Day Revolving Credit Agreement are for general corporate purposes. The Delayed Draw Term Credit Agreement provides the Company with the ability to
29
FINANCIAL POSITION AND LIQUIDITY (Continued)
borrow up to $1,250 at the closing of the GOJO acquisition, subject to satisfaction of customary closing conditions for similar facilities, for the purpose of financing a portion of the consideration under the membership interest purchase agreement (the Acquisition Agreement), paying related fees and expenses and repaying certain indebtedness of GOJO as contemplated by the Acquisition Agreement, with remaining amounts available to Clorox for general corporate purposes.
There were no borrowings under the Revolving Credit Agreements and the Delayed Draw Term Credit Agreement as of March 31, 2026 and no borrowings under the $1,200 revolving credit agreement that matures in March 2030 as of June 30, 2025, and the Company believes that borrowings under the Revolving Credit Agreements and the Delayed Term Credit Agreement are and will continue to be available for the purposes stated in each agreement. The Revolving Credit Agreements and the Delayed Term Credit Agreement include certain restrictive covenants and limitations. The primary restrictive covenant is a minimum ratio of 4.0, calculated as total earnings before interest, taxes, depreciation and amortization and other similar noncash charges and certain other items (Consolidated EBITDA) to total interest expense for the trailing four quarters (Interest Coverage ratio), as defined and described in each agreement.
The Company was in compliance with all restrictive covenants and limitations in the Revolving Credit Agreements and Delayed Draw Term Credit Agreement as of March 31, 2026 and anticipates being in compliance with all restrictive covenants for the foreseeable future.
As of March 31, 2026, the Company maintained $35 of foreign and other credit lines, of which $8 was outstanding.
Subsequent to March 31, 2026, to finance the GOJO acquisition, the Company drew down $1,250 from the Delayed Draw Term Credit Agreement. The Company plans to refinance a portion of GOJO acquisition related borrowings using long-term debt financing.
Stock Repurchases and Dividend Payments
As of March 31, 2026, the Company had two stock repurchase programs: an open-market purchase program with an authorized aggregate purchase amount of up to $2,000, which has no expiration date, and a program to offset the anticipated impact of dilution related to stock-based awards (the Evergreen Program), which has no authorization limit on the dollar amount and no expiration date. During the three and nine months ended March 31, 2026, the Company repurchased 0 and 2,157 thousand shares of common stock at a cost of $0 and $254, respectively. During the three and nine months ended March 31, 2025, the Company repurchased 0 and 1,695 thousand shares of common stock at a cost of $0 and $257, respectively. These costs exclude the impact of excise taxes.
Dividends per share declared and total dividends paid to Clorox stockholders were as follows for the periods indicated:
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
| Dividends per share declared | $ | 1.24 | $ | 1.22 | $ | 4.96 | $ | 4.88 | |||||||||||||||
| Total dividends paid | 150 | 150 | 452 | 452 | |||||||||||||||||||
CONTINGENCIES
See notes to condensed consolidated financial statements for information on the Company’s contingencies.
RECENTLY ISSUED ACCOUNTING STANDARDS
See notes to condensed consolidated financial statements for a summary of recently issued accounting standards relevant to the Company.
NON-GAAP FINANCIAL MEASURES
The non-GAAP financial measures that are included in this MD&A and the reasons management believes they are useful to investors are described below. Certain non-GAAP financial measures may be considered in determining incentive compensation. These measures should be considered supplemental in nature and are not intended to be a substitute for the related financial information prepared in accordance with U.S. GAAP. In addition, these measures may not be the same as similarly named measures presented by other companies.
Adjusted earnings before interest and income taxes (adjusted EBIT) represents earnings (losses) before income taxes excluding interest income, interest expense and other significant items that are nonrecurring or unusual (such as the pension settlement charge, incremental costs and insurance recoveries related to the August 2023 cyberattack, asset impairments, charges related to
30
NON-GAAP FINANCIAL MEASURES (Continued)
the digital capabilities and productivity enhancements investment, acquisition and integration costs related to acquisitions, significant losses related to divestitures and other nonrecurring or unusual items impacting comparability). Due to the nature, scope and magnitude of these costs, the Company’s management believes presenting these costs as an adjustment in the non-GAAP results provides additional information to investors about trends in the Company’s operations. See below and notes to condensed consolidated financial statements for additional information on these costs.
The Company uses this measure to assess the operating results and performance of its segments, monitor actual results as compared to plan, perform analytical comparisons, identify strategies to improve performance, and allocate resources to each segment. Management believes that the presentation of adjusted EBIT is useful to investors to assess operating performance on a consistent basis by removing the impact of the items that management believes does not directly reflect the performance of each segment's underlying operations. It also allows investors to view underlying operating results in the same manner as they are viewed by Company management. Adjusted EBIT margin is the ratio of adjusted EBIT to net sales.
Reconciliation of earnings before income taxes to adjusted EBIT | |||||||||||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
Earnings before income taxes | $ | 256 | $ | 254 | $ | 578 | $ | 668 | |||||||||||||||
| Interest income | (4) | (2) | (7) | (7) | |||||||||||||||||||
| Interest expense | 27 | 23 | 75 | 66 | |||||||||||||||||||
Loss on divestiture (1) | — | — | — | 118 | |||||||||||||||||||
Acquisition and integration costs (2) | 7 | — | 7 | — | |||||||||||||||||||
Cyberattack costs, net of insurance recoveries (3) | — | (35) | — | (70) | |||||||||||||||||||
Digital capabilities and productivity enhancements investment (4) | 10 | 26 | 59 | 81 | |||||||||||||||||||
| Adjusted EBIT | $ | 296 | $ | 266 | $ | 712 | $ | 856 | |||||||||||||||
(1)Represents the loss related to the divestiture of the Better Health VMS business.
(2)Represents expenses related to the Company’s acquisition and integration of GOJO.
As a result of this transaction, various acquisition and integration-related costs related to the acquisition and efforts to integrate the recently acquired business to the Company’s systems and processes were and will be incurred. These costs include direct acquisition transaction costs and legal-entity, operational, manufacturing, and information technology integration costs.
Due to the nature, scope and magnitude of these costs, the Company's management believes presenting these costs as an adjustment in the non-GAAP results provides additional information to investors about trends in the Company's operations and is useful for period over period comparisons. It also allows investors to view underlying operating results in the same manner as they are viewed by Company management.
(3)Represents incremental costs and insurance recoveries related to the cyberattack.
(4)Represents expenses related to the Company's digital capabilities and productivity enhancements investment.
As announced in August 2021, the company invested in transformative technologies and processes over a five-year period beginning in fiscal year 2022 and completed during the third quarter of fiscal year 2026. The investment included replacement of the company's ERP system and transitioning to a cloud-based platform as well as the implementation of a suite of other digital technologies. The total incremental transformational investment was approximately $580 million. It is expected that these implementations will generate efficiencies and transform the company's operations in the areas of supply chain, digital commerce, innovation, brand building and more over the long term.
Of the total investment, approximately 75% represented incremental operating costs primarily recorded within selling and administrative expenses to be adjusted from reported EPS for purposes of disclosing adjusted EPS. About 70% of these operating costs were related to the implementation of the ERP, with the remaining costs primarily related to the implementation of complementary technologies.
Due to the nature, scope and magnitude of this investment, these costs were considered by management to represent incremental transformational costs above the historical normal level of spending for information technology to support operations. Since these strategic investments, including incremental operating costs, ceased at the end of the investment period, are not expected to recur in the foreseeable future and are not considered representative of the Company's underlying operating performance, the Company's management believes presenting these costs as an adjustment in the non-GAAP results provides additional information to investors about trends in the Company's operations and is useful for period-over-period comparisons. It also allows investors to view underlying operating results in the same manner as they are viewed by Company management.
31
NON-GAAP FINANCIAL MEASURES (Continued)
During the three and nine months ended March 31, 2026, the Company incurred approximately $10 and $59, respectively, and during the three and nine months ended March 31, 2025 the Company incurred approximately $26 and $81, respectively, of operating expenses related to its digital capabilities and productivity enhancements investment. The expenses relate to the following:
| Three months ended | Nine months ended | ||||||||||||||||||||||
| 3/31/2026 | 3/31/2025 | 3/31/2026 | 3/31/2025 | ||||||||||||||||||||
External consulting fees (a) | $ | 7 | $ | 19 | $ | 46 | $ | 56 | |||||||||||||||
IT project personnel costs (b) | 1 | 1 | 3 | 5 | |||||||||||||||||||
Other (c) | 2 | 6 | 10 | 20 | |||||||||||||||||||
| Total | $ | 10 | $ | 26 | $ | 59 | $ | 81 | |||||||||||||||
(a) Comprised of third-party consulting fees incurred to assist in the project management and end-to-end systems integration of this transformative investment. The Company relies on consultants for certain capabilities required for these programs that the Company does not maintain internally. These costs support the implementation of these programs incremental to the Company's normal IT costs and will not be incurred following implementation.
(b) Comprised of labor costs associated with internal IT project management teams that are utilized to oversee the new system implementations. Given the magnitude and transformative nature of the implementations planned, the necessary project management costs are incremental to the historical levels of spend and will no longer be incurred subsequent to implementation. As a result of this long-term strategic investment, the Company considers these costs not reflective of the ongoing costs to operate its business.
(c) Comprised of various other expenses associated with the Company’s new system implementations, including Company personnel dedicated to the project that have been backfilled with either permanent or temporary resources in positions that are considered part of normal operating expenses.
Organic sales growth / (decrease) is defined as net sales growth / (decrease) excluding the effect of foreign exchange rate changes and any acquisitions and divestitures. Management believes that the presentation of organic sales growth / (decrease) is useful to investors because it excludes sales from any acquisitions and divestitures, which results in a comparison of sales only from the businesses that the Company was operating and expects to continue to operate throughout the relevant periods, and the Company’s estimate of the impact of foreign exchange rate changes, which are difficult to predict and out of the control of the Company and management.
The following table provides a reconciliation of organic sales growth / (decrease) (non-GAAP) to net sales growth / (decrease) (GAAP), the most comparable GAAP measure:
| Three months ended March 31, 2026 | |||||||||||||||||||||||||||||
| Percentage change versus the year-ago period | |||||||||||||||||||||||||||||
| Health and Wellness | Household | Lifestyle | International | Total Company (1) | |||||||||||||||||||||||||
| Net sales growth / (decrease) (GAAP) | — | % | 3 | % | (9) | % | 8 | % | — | % | |||||||||||||||||||
| Add: Foreign Exchange | — | — | — | (6) | (1) | ||||||||||||||||||||||||
| Organic sales growth / (decrease) (non-GAAP) | — | % | 3 | % | (9) | % | 2 | % | (1) | % | |||||||||||||||||||
| Nine months ended March 31, 2026 | |||||||||||||||||||||||||||||
| Percentage change versus the year-ago period | |||||||||||||||||||||||||||||
| Health and Wellness | Household | Lifestyle | International | Total Company (1) | |||||||||||||||||||||||||
| Net sales growth / (decrease) (GAAP) | (6) | % | (7) | % | (13) | % | 5 | % | (7) | % | |||||||||||||||||||
| Add: Foreign Exchange | — | — | — | (3) | — | ||||||||||||||||||||||||
Add/(Subtract): Divestitures / Acquisitions (2) | — | — | — | — | 1 | ||||||||||||||||||||||||
| Organic sales growth / (decrease) (non-GAAP) | (6) | % | (7) | % | (13) | % | 2 | % | (6) | % | |||||||||||||||||||
(1)Total Company includes Corporate and Other. Corporate and Other includes the results of the Better Health VMS business through the date of divestiture.
(2)The divestiture impact is calculated as net sales from the Better Health VMS business after the sale date in the nine month year-ago period.
32
CAUTIONARY STATEMENT
This Report, including the exhibits hereto and the information incorporated by reference herein, contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, among others, regarding the acquisition of GOJO, and any such forward-looking statements involve risks, assumptions and uncertainties. Except for historical information, statements about future volumes, sales, organic sales growth, foreign currencies, costs, cost savings, margins, earnings, earnings per share, including as a result of the GOJO acquisition, diluted earnings per share, foreign currency exchange rates, tax rates, cash flows, plans, objectives, expectations, growth or profitability are forward-looking statements based on management’s estimates, beliefs, assumptions and projections. Words such as “could,” “may,” “expects,” “anticipates,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “will,” “predicts,” and variations on such words, and similar expressions that reflect the Company’s current views with respect to future events and operational, economic and financial performance are intended to identify such forward-looking statements. These forward-looking statements are only predictions, subject to risks and uncertainties, and actual results could differ materially from those discussed. Important factors that could affect performance and cause results to differ materially from management’s expectations, are described in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025, and in this Report, as updated from time to time in the Company’s Securities and Exchange Commission filings. These factors include, but are not limited to:
•the risks arising from the integration of the GOJO business; the uncertainty of rating agency actions; the risk that the anticipated benefits and synergies of the acquisition may not be realized when expected or at all; the risk of unexpected costs or expenses resulting from the acquisition, including the costs of financing; the risk of litigation related to the acquisition, including resulting expense; the risks related to disruption to ongoing business operations of the Company and GOJO and diversion of time of management of the Company and GOJO as a result of the acquisition; the risk that the acquisition may have an adverse effect on the ability of the Company and GOJO to retain key personnel, customers and suppliers; the risk that the credit ratings of the Company decline following the acquisition; the risk that the consummation of the acquisition has a negative effect on the market price of the common stock of the Company or on the Company’s or GOJO’s operating results;
•unfavorable general economic and geopolitical conditions beyond the Company’s control, including inflation, supply chain disruptions, labor shortages, wage pressures, fuel and energy costs, interest rate fluctuations, foreign currency exchange rate fluctuations, weather events or natural disasters, disease outbreaks or pandemics, terrorism, and unstable geopolitical conditions, including active armed conflicts and military hostilities in the Middle East, such as the ongoing conflict involving Iran, and rising tensions in various parts of the world, as well as macroeconomic and geopolitical volatility and uncertainty resulting from a number of these and other factors, such as actual and potential shifts in U.S. and foreign trade policies, escalating trade tensions between the U.S. and its trading partners, especially China, the potential expansion of sanctions regimes, and disruptions to global markets or transportation routes, particularly due to the imposition of U.S. and retaliatory tariffs;
•the impact of market and category declines, and the Company’s product and geographic mix on its ability to meet sales growth targets;
•the Company’s ability to successfully execute or realize the anticipated benefits of its strategic or transformational initiatives, including the ERP transition and the related timing and volume of shipment movement related to the ERP transition;
•the impact of the changing retail environment, including the growth of alternative retail channels and business models, and changing consumer preferences;
•intense competition in the Company’s markets;
•volatility and increases in the costs of raw materials, energy, transportation, labor and other necessary supplies or services;
•risks related to supply chain issues, product shortages and disruptions to the business, as a result of increased supply chain dependencies due to an expanded supplier network and a reliance on certain single-source suppliers;
•risks related to the Company’s use of and reliance on information technology systems, including potential and actual security breaches, cyberattacks, privacy breaches or data breaches that result in the unauthorized disclosure of consumer, customer, employee or Company information, business, service or operational disruptions, or that impact the Company’s financial results or financial reporting, or any resulting unfavorable outcomes, increased costs or legal proceedings;
33
CAUTIONARY STATEMENT (Continued)
•the ability of the Company to innovate and to develop and introduce commercially successful products, or expand into adjacent categories and countries;
•the ability of the Company to successfully manage global political, legal, tax and regulatory risks, including due to regulatory uncertainty and lack of regulatory convergence among different jurisdictions;
•lower revenue, increased costs, other financial statement impacts or reputational harm resulting from government actions, compliance with regulations, or any material costs imposed by changes in regulation;
•the Company’s ability to maintain its business reputation and the reputation of its brands and products;
•dependence on key customers and risks related to customer consolidation and ordering patterns;
•the Company’s ability to attract and retain key personnel, which may continue to be impacted by challenges in the labor market, such as increasing labor costs and sustained labor shortages;
•changes to the Company’s processes and procedures as a result of its digital capabilities and productivity enhancements that may result in changes to the Company’s internal controls over financial reporting;
•risks related to the Company’s continued operation of the Glad business;
•risks related to international operations and international trade, including changing macroeconomic conditions as a result of inflation, volatile commodity prices and increases in raw and packaging materials prices, labor, energy and logistics; global economic or political instability; foreign currency fluctuations, such as devaluations, and foreign currency exchange rate controls; changes in governmental policies, including trade policy and tariffs, travel or immigration restrictions, new or additional tariffs, and price or other controls; labor claims and civil unrest; potential operational or supply chain disruptions from wars and military conflicts, including active armed conflicts and military hostilities in the Middle East, such as the ongoing conflict involving Iran, and/or Ukraine and rising tensions in various parts of the world, such as between China and Taiwan; potential negative impact and liabilities from the use, storage and transportation of chlorine in certain international markets where chlorine is used in the production of bleach; widespread health emergencies; and the possibility of nationalization, expropriation of assets or other government action or inaction, including the impacts of any prolonged U.S. government shutdown;
•the impact of climate change and other sustainability issues on sales, operating costs, reputation or stakeholder relationships;
•the impact of product liability claims, labor claims and other legal, governmental or tax proceedings, including in foreign jurisdictions and in connection with any product recalls;
•risks relating to acquisitions, new ventures and divestitures, and associated costs, including for asset impairment charges related to, among others, intangible assets, including trademarks and goodwill, and integration costs and potential contingent liabilities related to those transactions;
•the accuracy of the Company’s estimates and assumptions on which its financial projections, including any sales or earnings guidance or outlook it may provide from time to time, are based;
•risks related to the Company's reliance on third-party service providers, including inability to meet cost savings or efficiencies, business or systems disruptions, and other liabilities, including legal or regulatory risk;
•environmental matters, including costs associated with the remediation and monitoring of past contamination, and possible increases in costs resulting from actions by relevant regulators, and the handling and/or transportation of hazardous substances;
•the Company’s ability to effectively utilize, assert and defend its intellectual property rights, and any infringement or claimed infringement by the Company of third-party intellectual property rights;
•the effect of the Company’s indebtedness and credit rating on its business operations and financial results and the Company’s ability to access capital markets and other funding sources, as well as the cost of capital to the Company;
•the Company’s ability to pay and declare dividends or repurchase its stock in the future; and
•the impacts of potential stockholder activism.
The Company’s forward-looking statements in this Report are based on management’s current views, beliefs, assumptions and expectations regarding future events and speak only as of the date of this Report. The Company undertakes no obligation to
34
CAUTIONARY STATEMENT (Continued)
publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by the federal securities laws.
In this Report, unless the context requires otherwise, the terms “the Company,” “Clorox,” “we,” “us,” and “our” refer to The Clorox Company and its subsidiaries.
35
Item 3. Quantitative and Qualitative Disclosures About Market Risk
There have not been any material changes to the Company’s market risk since June 30, 2025. For additional information, refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in Exhibit 99.1 of the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025.
Item 4. Controls and Procedures
The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this Report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures, as of the end of the period covered by this Report, were effective such that the information required to be disclosed by the Company in reports filed under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
During the first fiscal quarter of the fiscal year ending June 30, 2026, the Company began transitioning core U.S. operations to the new enterprise resource planning system (ERP) as part of the continuing phased implementation of its technology transformation. This transition was completed in the third quarter of fiscal year 2026. As a result of this transition, we have made changes to our internal control over financial reporting to address processes and procedures impacted by the ERP implementation.
Other than the ERP implementation noted above, no change in the Company’s internal control over financial reporting occurred during the third fiscal quarter of the fiscal year ending June 30, 2026, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
36
PART II – OTHER INFORMATION
Item 1.A. Risk Factors
For information regarding Risk Factors, please refer to Item 1.A. in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025, and the information in “Cautionary Statement” included in this Report.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
In May 2018, the Board of Directors authorized the Company to repurchase up to $2,000 million in shares of common stock on the open market (the 2018 Open-Market Program), which has no expiration date.
In August 1999, the Board of Directors authorized a stock repurchase program to reduce or eliminate dilution upon the issuance of common stock pursuant to the Company’s stock compensation plans (the Evergreen Program). In November 2005, the Board of Directors authorized the extension of the Evergreen Program to reduce or eliminate dilution in connection with issuances of common stock pursuant to the Company’s 2005 Stock Incentive Plan. The Evergreen Program has no expiration date and has no specified limit as to dollar amount and therefore is not included in column [d] below.
The following table sets forth the purchases of the Company’s securities by the Company and any affiliated purchasers within the meaning of Rule 10b-18(a)(3) (17 CFR 240.10b-18(a)(3)) during the third quarter of fiscal year 2026.
| [a] | [b] | [c] | [d] | ||||||||||||||||||||
| Period | Total Number of Shares Purchased | Average Price Paid per Share (1) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs | |||||||||||||||||||
January 1 to 31, 2026 | — | $ | — | — | $876 million | ||||||||||||||||||
February 1 to 28, 2026 | — | — | — | $876 million | |||||||||||||||||||
March 1 to 31, 2026 | — | — | — | $876 million | |||||||||||||||||||
| Total | — | — | — | ||||||||||||||||||||
(1) Average price paid per share in the period includes commission and excludes the impact of excise taxes.
Item 5. Other Information
During the three months ended March 31, 2026, none
37
Item 6. Exhibits
See Exhibit Index below, which is incorporated by reference herein.
EXHIBIT INDEX
*Refiled herewith to provide an updated hyperlink to the appropriate prior filing.
38
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| THE CLOROX COMPANY | ||||||||
| (Registrant) | ||||||||
| DATE: April 30, 2026 | BY | /s/ Laura Peck | ||||||
| Laura Peck Vice President – Chief Accounting Officer and Corporate Controller | ||||||||
39
Exhibit 31.1
CERTIFICATION
I, Linda Rendle, certify that:
1.I have reviewed this quarterly report on Form 10-Q of The Clorox Company;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: April 30, 2026 | ||
| /s/ Linda Rendle | ||
| Linda Rendle | ||
Chair and Chief Executive Officer | ||
Exhibit 31.2
CERTIFICATION
I, Luc Bellet, certify that:
1.I have reviewed this quarterly report on Form 10-Q of The Clorox Company;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: April 30, 2026 | ||
| /s/ Luc Bellet | ||
| Luc Bellet | ||
| Executive Vice President - Chief Financial Officer | ||
Exhibit 32
CERTIFICATION
In connection with the periodic report of The Clorox Company (the “Company”) on Form 10-Q for the period ended March 31, 2026, as filed with the Securities and Exchange Commission (the “Report”), we, Linda Rendle, Chair and Chief Executive Officer of the Company, and Luc Bellet, Executive Vice President - Chief Financial Officer of the Company, hereby certify as of the date hereof, solely for purposes of Title 18, Chapter 63, Section 1350 of the United States Code, that to our knowledge:
(1)the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and
(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.
This Certification has not been, and shall not be deemed, “filed” with the Securities and Exchange Commission.
Date: April 30, 2026
| /s/ Linda Rendle | ||
| Linda Rendle | ||
Chair and Chief Executive Officer | ||
| /s/ Luc Bellet | ||
| Luc Bellet | ||
| Executive Vice President - Chief Financial Officer | ||