pg-20240930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark one)


x			True			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended September 30, 2024


o			False			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

THE PROCTER & GAMBLE COMPANY

(Exact name of registrant as specified in its charter)

Ohio

1-434

31-0411980

(State of Incorporation)

(Commission File Number)

(I.R.S. Employer Identification Number)

One Procter & Gamble Plaza

Cincinnati

One Procter & Gamble Plaza, Cincinnati, Ohio

45202

(Address of principal executive offices)

(Zip Code)

(513) 983-1100

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, without Par Value	PG	NYSE
0.500% Notes due 2024	PG24A	NYSE
0.625% Notes due 2024	PG24B	NYSE
1.375% Notes due 2025	PG25	NYSE
0.110% Notes due 2026	PG26D	NYSE
3.250% EUR Notes due 2026	PG26F	NYSE
4.875% EUR Notes due May 2027	PG27A	NYSE
1.200% Notes due 2028	PG28	NYSE
3.150% EUR Notes due 2028	PG28B	NYSE
1.250% Notes due 2029	PG29B	NYSE
1.800% Notes due 2029	PG29A	NYSE
6.250% GBP Notes due January 2030	PG30	NYSE
0.350% Notes due 2030	PG30C	NYSE
0.230% Notes due 2031	PG31A	NYSE
3.250% EUR Notes due 2031	PG31B	NYSE
5.250% GBP Notes due January 2033	PG33	NYSE
3.200% EUR Notes due 2034	PG34C	NYSE
1.875% Notes due 2038	PG38	NYSE
0.900% Notes due 2041	PG41	NYSE

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 þ No o

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 þ No o

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.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

False

Emerging growth company

False

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 o No þ False

There were 2,355,041,729 shares of Common Stock outstanding as of September 30, 2024.


FORM 10-Q TABLE OF CONTENTS			Page
PART I	Item 1.	Financial Statements	1
		Consolidated Statements of Earnings	1
		Consolidated Statements of Comprehensive Income	1
		Consolidated Balance Sheets	2
		Consolidated Statements of Shareholders' Equity	3
		Consolidated Statements of Cash Flows	4
		Notes to Consolidated Financial Statements	5
		Note 1: Basis of Presentation	5
		Note 2: New Accounting Pronouncements and Policies	5
		Note 3: Segment Information	5
		Note 4: Goodwill and Intangible Assets	6
		Note 5: Earnings Per Share	8
		Note 6: Share-Based Compensation and Postretirement Benefits	8
		Note 7: Risk Management Activities and Fair Value Measurements	9
		Note 8: Accumulated Other Comprehensive Income/(Loss)	10
		Note 9: Commitments and Contingencies	10
		Note 10: Supplier Finance Programs	11
		Note 11: Restructuring Program	11
	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	12
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	22
	Item 4.	Controls and Procedures	22
PART II	Item 1.	Legal Proceedings	23
	Item 1A.	Risk Factors	24
	Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities	24
	Item 5.	Other Information	24
	Item 6.	Exhibits	25
		Signature	25

The Procter & Gamble Company 1

PART I. FINANCIAL INFORMATION


Item 1.			Financial Statements

THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EARNINGS


	Three Months Ended September 30
Amounts in millions except per share amounts	2024		2023
NET SALES	$	21,737	$	21,871
Cost of products sold	10,421		10,501
Selling, general and administrative expense	5,519		5,604
OPERATING INCOME	5,797		5,767
Interest expense	(238)		(225)
Interest income	135		128
Other non-operating income/(expense), net	(554)		132
EARNINGS BEFORE INCOME TAXES	5,140		5,802
Income taxes	1,152		1,246
NET EARNINGS	3,987		4,556
Less: Net earnings attributable to noncontrolling interests	28		35
NET EARNINGS ATTRIBUTABLE TO PROCTER & GAMBLE	$	3,959	$	4,521

NET EARNINGS PER COMMON SHARE (1)
Basic	$	1.65	$	1.89
Diluted	$	1.61	$	1.83

(1)Basic net earnings per common share and Diluted net earnings per common share are calculated on Net earnings attributable to Procter & Gamble.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME


	Three Months Ended September 30
Amounts in millions	2024		2023
NET EARNINGS	$	3,987	$	4,556
OTHER COMPREHENSIVE INCOME/(LOSS), NET OF TAX
Foreign currency translation	1,026		(409)
Unrealized gains/(losses) on investment securities	2		(1)
Unrealized gains/(losses) on defined benefit postretirement plans	(21)		45
TOTAL OTHER COMPREHENSIVE INCOME/(LOSS), NET OF TAX	1,007		(366)
TOTAL COMPREHENSIVE INCOME	4,994		4,190
Less: Comprehensive income attributable to noncontrolling interests	28		33
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO PROCTER & GAMBLE	$	4,965	$	4,157

See accompanying Notes to Consolidated Financial Statements.

2 The Procter & Gamble Company

THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS


Amounts in millions			September 30, 2024		June 30, 2024
Assets
CURRENT ASSETS
Cash and cash equivalents			$	12,156	$	9,482
Accounts receivable			6,314		6,118
INVENTORIES
Materials and supplies			1,820		1,617
Work in process			921		929
Finished goods			4,546		4,470
Total inventories			7,287		7,016
Prepaid expenses and other current assets			1,692		2,095
TOTAL CURRENT ASSETS			27,449		24,709
PROPERTY, PLANT AND EQUIPMENT, NET			22,506		22,152
GOODWILL			40,970		40,303
TRADEMARKS AND OTHER INTANGIBLE ASSETS, NET			22,053		22,047
OTHER NONCURRENT ASSETS			13,503		13,158
TOTAL ASSETS			$	126,482	$	122,370

Liabilities and Shareholders' Equity
CURRENT LIABILITIES
Accounts payable			$	15,350	$	15,364
Accrued and other liabilities			10,661		11,073
Debt due within one year			10,409		7,191
TOTAL CURRENT LIABILITIES			36,420		33,627
LONG-TERM DEBT			25,744		25,269
DEFERRED INCOME TAXES			6,420		6,516
OTHER NONCURRENT LIABILITIES			5,757		6,398
TOTAL LIABILITIES			74,341		71,811
SHAREHOLDERS’ EQUITY
Preferred stock			791		798
Common stock – shares issued –	September 2024	4,009.2
	June 2024	4,009.2	4,009		4,009
Additional paid-in capital			68,102		67,684
Reserve for ESOP debt retirement			(707)		(737)
Accumulated other comprehensive loss			(10,893)		(11,900)
Treasury stock			(134,823)		(133,379)
Retained earnings			125,361		123,811
Noncontrolling interest			300		272
TOTAL SHAREHOLDERS’ EQUITY			52,141		50,559
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY			$	126,482	$	122,370

See accompanying Notes to Consolidated Financial Statements.

The Procter & Gamble Company 3

THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY


	Three Months Ended September 30, 2024
Dollars in millions; shares in thousands	Common Stock		Preferred Stock	Additional Paid-In Capital	Reserve for ESOP Debt Retirement	Accumulated Other Comprehensive Income/(Loss)	Treasury Stock	Retained Earnings	Noncontrolling Interest	Total Shareholders' Equity
	Shares	Amount
BALANCE JUNE 30, 2024	2,357,051	$4,009	$798	$67,684	($737)	($11,900)	($133,379)	$123,811	$272	$50,559
Net earnings								3,959	28	3,987
Other comprehensive income/(loss)						1,006			1	1,007
Dividends and dividend equivalents ($1.0065 per share):
Common								(2,378)		(2,378)
Preferred								(72)		(72)
Treasury stock purchases	(11,552)						(1,942)			(1,942)
Employee stock plans	8,769			417			492			910
Preferred stock conversions	774		(7)	1			6			—
ESOP debt impacts					30			41		71
Noncontrolling interest, net				—					—	—
BALANCE SEPTEMBER 30, 2024	2,355,042	$4,009	$791	$68,102	($707)	($10,893)	($134,823)	$125,361	$300	$52,141


	Three Months Ended September 30, 2023
Dollars in millions; shares in thousands	Common Stock		Preferred Stock	Additional Paid-In Capital	Reserve for ESOP Debt Retirement	Accumulated Other Comprehensive Income/(Loss)	Treasury Stock	Retained Earnings	Noncontrolling Interest	Total Shareholders' Equity
	Shares	Amount
BALANCE JUNE 30, 2023	2,362,120	$4,009	$819	$66,556	($821)	($12,220)	($129,736)	$118,170	$288	$47,065
Net earnings								4,521	35	4,556
Other comprehensive income/(loss)						(363)			(2)	(366)
Dividends and dividend equivalents ($0.9407 per share):
Common								(2,225)		(2,225)
Preferred								(70)		(70)
Treasury stock purchases	(9,843)						(1,508)			(1,508)
Employee stock plans	3,721			265			209			474
Preferred stock conversions	888		(7)	1			6			—
ESOP debt impacts					39			48		87
Noncontrolling interest, net				—					—	—
BALANCE SEPTEMBER 30, 2023	2,356,886	$4,009	$812	$66,822	($782)	($12,583)	($131,029)	$120,443	$321	$48,014

See accompanying Notes to Consolidated Financial Statements.

4 The Procter & Gamble Company

THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS


	Three Months Ended September 30
Amounts in millions	2024		2023
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD	$	9,482	$	8,246
OPERATING ACTIVITIES
Net earnings	3,987		4,556
Depreciation and amortization	728		702
Share-based compensation expense	105		125
Deferred income taxes	184		102
Loss/(gain) on sale of assets	794		(3)


Change in accounts receivable	(134)		(830)
Change in inventories	(188)		(142)
Change in accounts payable and accrued and other liabilities	(648)		857
Change in other operating assets and liabilities	(558)		(671)
Other	32		208
TOTAL OPERATING ACTIVITIES	4,302		4,904
INVESTING ACTIVITIES
Capital expenditures	(993)		(925)
Proceeds from asset sales	45		3
Acquisitions, net of cash acquired	(6)		—
Other investing activity	(154)		(300)
TOTAL INVESTING ACTIVITIES	(1,108)		(1,222)
FINANCING ACTIVITIES
Dividends to shareholders	(2,445)		(2,290)
Additions to short-term debt with original maturities of more than three months	4,090		2,179
Reductions in short-term debt with original maturities of more than three months	(571)		(1,906)
Net additions/(reductions) to other short-term debt	(444)		2,172

Reductions in long-term debt	(70)		(1,004)
Treasury stock purchases	(1,939)		(1,500)
Impact of stock options and other	745		312
TOTAL FINANCING ACTIVITIES	(634)		(2,038)
EFFECT OF EXCHANGE RATE CHANGES ON CASH, CASH EQUIVALENTS AND RESTRICTED CASH	116		(156)
CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH	2,675		1,487
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD	$	12,156	$	9,733

See accompanying Notes to Consolidated Financial Statements.

The Procter & Gamble Company 5

THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

The accompanying unaudited Consolidated Financial Statements of The Procter & Gamble Company and subsidiaries ("the Company," "Procter & Gamble," "P&G," "we" or "our") should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024. We have prepared these statements in conformity with accounting principles generally accepted in the United States (U.S. GAAP) pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC) for interim financial information. Note that certain columns and rows may not add due to rounding. In the opinion of management, the accompanying Consolidated Financial Statements contain all normal recurring adjustments necessary to present fairly the financial position, results of operations and cash flows for the interim periods reported. However, the results of operations included in such financial statements may not necessarily be indicative of annual results.

2. New Accounting Pronouncements and Policies

In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2023-07, “Segment Reporting: Improvements to Reportable Segment Disclosures.” This guidance requires disclosure of incremental segment information on an annual and interim basis. This amendment is effective for our fiscal year ending June 30, 2025 and our interim periods within the fiscal year ending June 30, 2026. The guidance will require additional disclosures in the Segment Information footnote, but will not have a material impact on our Consolidated Financial Statements.

In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes: Improvements to Income Tax Disclosures.” This guidance requires consistent categories and greater disaggregation of information in the rate reconciliation and disclosures of income taxes paid by jurisdiction. This amendment is effective for our fiscal year ending June 30, 2026. We are currently assessing the impact of this guidance on our disclosures.

No other new accounting pronouncement issued or effective during the fiscal year had, or is expected to have, a material impact on our Consolidated Financial Statements.

3. Segment Information

Under U.S. GAAP, our operating segments are aggregated into five reportable segments: 1) Beauty, 2) Grooming, 3) Health Care, 4) Fabric & Home Care and 5) Baby, Feminine & Family Care. Our five reportable segments are comprised of:

•Beauty: Hair Care (Conditioners, Shampoos, Styling Aids, Treatments); Personal Care (Antiperspirants and Deodorants, Personal Cleansing); Skin Care (Facial Moisturizers, Cleaners and Treatments);

•Grooming: Grooming (Appliances, Female Blades & Razors, Male Blades & Razors, Pre- and Post-Shave Products, Other Grooming);

•Health Care: Oral Care (Toothbrushes, Toothpaste, Other Oral Care); Personal Health Care (Gastrointestinal, Pain Relief, Rapid Diagnostics, Respiratory, Vitamins/Minerals/Supplements, Other Personal Health Care);

•Fabric & Home Care: Fabric Care (Fabric Enhancers, Laundry Additives, Laundry Detergents); Home Care (Air Care, Dish Care, P&G Professional, Surface Care); and

•Baby, Feminine & Family Care: Baby Care (Baby Wipes, Taped Diapers and Pants); Feminine Care (Adult Incontinence, Menstrual Care); Family Care (Paper Towels, Tissues, Toilet Paper).

Amounts in millions of dollars except per share amounts or as otherwise specified.

6 The Procter & Gamble Company

Operating segments as a percentage of consolidated net sales are as follows:


	% of Net sales by operating segment (1)
	Three Months Ended September 30
	2024		2023
Fabric Care	23	%	23	%
Home Care	13	%	12	%
Baby Care	9	%	9	%
Hair Care	9	%	9	%
Family Care	8	%	8	%
Grooming	8	%	8	%
Oral Care	8	%	8	%
Personal Health Care	7	%	6	%
Feminine Care	6	%	7	%
Personal Care (2)	6	%	6	%
Skin Care (2)	3	%	4	%
Total	100	%	100	%

(1)% of Net sales by operating segment excludes sales recorded in Corporate.

(2)Effective July 1, 2024, the Beauty reportable business segment separated Skin and Personal Care into individual operating segments, Skin Care and Personal Care. This transition included separation of the management team, strategic decision-making, innovation plans, financial targets, budgets and management reporting.

The following is a summary of reportable segment results:


		Three Months Ended September 30
		Net Sales		Earnings/(Loss) Before Income Taxes		Net Earnings/(Loss)
Beauty	2024	$	3,892	$	1,067	$	840
	2023	4,097		1,249		971
Grooming	2024	1,723		522		426
	2023	1,724		533		421
Health Care	2024	3,147		953		741
	2023	3,074		889		689
Fabric & Home Care	2024	7,710		2,077		1,621
	2023	7,646		2,031		1,569
Baby, Feminine & Family Care	2024	5,102		1,383		1,066
	2023	5,186		1,408		1,075
Corporate	2024	163		(862)		(707)
	2023	144		(308)		(168)
Total Company	2024	$	21,737	$	5,140	$	3,987
	2023	21,871		5,802		4,556

4. Goodwill and Intangible Assets

Goodwill is allocated by reportable segment as follows:


	Beauty		Grooming		Health Care		Fabric & Home Care		Baby, Feminine & Family Care		Total Company
Goodwill at June 30, 2024	$	13,723	$	12,633	$	7,638	$	1,810	$	4,499	$	40,303
Acquisitions and divestitures	—		—		—		—		—		—
Translation and other	251		179		151		20		67		667

SEC Form 10-Q filed by Procter & Gamble Company