Newell Brands Inc. NWL reported third-quarter 2026 results, wherein both the top and bottom lines improved year over year. Sales exceeded the Zacks Consensus Estimate, while earnings met the same.
NWL posted adjusted earnings of 20 cents per share increased 17.6% from 17 cents a year ago and matched the Zacks Consensus Estimate.
Net sales increased 3.7% year over year to $1,873 million from $1,806 million, surpassing the Zacks Consensus Estimate of $1,852 million. The quarter benefited from broad-based business growth, improved productivity and favorable foreign exchange. Core sales increased 3.3%, marking the company's second consecutive quarter of reported sales growth.
Newell Brands Inc. Price, Consensus and EPS Surprise
Newell Brands Inc. price-consensus-eps-surprise-chart | Newell Brands Inc. Quote
NWL's Margin and Cost Performance
Adjusted gross profit increased 5.6% to $660 million from $625 million in the prior-year period. Adjusted gross margin expanded 70 basis points to 35.2% from 34.5%, as higher sales and manufacturing productivity more than offset inflationary pre10sures.
Adjusted selling, general and administrative expenses rose 2.8% year over year to $476 million from $463 million. Advertising and promotional expenses increased to $129 million from $124 million, reflecting continued investments in brand building and marketing.
Adjusted operating income climbed 13.6% year over year to $184 million from $162 million, while adjusted operating margin expanded to 9.8% from 8.9%. Adjusted EBITDA increased 10.2% to $248 million from $225 million.
However, reported operating income declined to $27 million from $119 million, primarily reflecting a $101 million non-cash impairment charge related to an indefinite-lived tradename. The company reported a net loss of $81 million against net income of $21 million a year earlier.
Newell's Segmental Performance
Home & Commercial Solutions generated sales of $1,012 million, up 7.4% from $942 million. Core sales increased 6%, supported by growth across the Kitchen, Home Fragrance and Commercial businesses.Adjusted operating income increased 34.4% year over year to $86 million from $64 million. Adjusted operating margin expanded to 8.5% from 6.8%.
Learning & Development sales advanced 1.6% year over year to $692 million from $681 million. Core sales increased 2.3%, driven by growth in the Writing business, while Baby remained roughly flat.
Adjusted operating income rose 20.8% year over year to $157 million from $130 million. Adjusted operating margin improved to 22.7% from 19.1%.
Outdoor & Recreation sales declined 7.7% year over year to $169 million from $183 million, while core sales decreased 6.4%. The segment recorded an adjusted operating loss of $10 million compared with $1 million a year earlier. Adjusted operating margin deteriorated to negative 5.9% from negative 0.5%.
The Corporate segment reported an adjusted operating loss of $49 million compared with $31 million in the prior-year period.
NWL's Geographic Trends Show Broad Growth
North America reported sales growth of 2.8%, with core sales increasing at the same rate during the quarter. International sales increased 5.5% year over year, while core sales advanced 4.4%, reflecting growth despite unfavorable currency movements in certain businesses.
Newell's Cash Flow and Financial Position
NWL ended the quarter with cash and cash equivalents of $249 million compared with $229 million a year earlier. Long-term debt totaled $4,841 million, while net debt stood at $4,592 million. Shareholders' equity was $2,364 million at quarter-end.
Operating cash flow for the first nine months of 2026 totaled $93 million compared with $103 million in the prior-year period.
During the quarter, the company established an $800 million asset-based revolving credit facility and issued $600 million in senior notes due 2031, supporting its refinancing and debt-management initiatives.
NWL Raises Its 2026 Sales Outlook
For the fourth quarter of 2026, Newell expects net sales and core sales to increase 1-3%. Adjusted operating margin is projected to be between 8.4% and 9%, while adjusted earnings are expected to be in the range of 17-19 cents per share.
For 2026, the company now expects net sales growth of 2-3%, up from its previous outlook of 1-2%. Core sales are projected to increase 1-2% compared with the earlier expectation of flat to 1% growth.
Adjusted operating margin guidance remains at 10%-10.4%. The company narrowed its adjusted earnings outlook to 74-76 cents per share from the previous range of 73-77 cents, maintaining the midpoint.
Newell also revised its operating cash flow outlook to approximately $150 million, primarily reflecting pension-related accounting effects and lower anticipated proceeds from receivables factoring. Higher sales expectations and additional cost containment measures are expected to offset increased inflationary pressures.
In the past six months, this Zacks Rank #3 (Hold) company’s shares have rallied 25.2% compared with the industry’s 7.4% growth.
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