Clorox slides as Q3 results prompt FY2026 EPS cut on ERP inventory drawdown
CLX•Clorox shares fell after the company reported Q3 fiscal 2026 results and cut full-year profit expectations. Clorox now forecasts FY2026 diluted EPS of $4.78–$4.98 and adjusted EPS of $5.45–$5.65, citing an ERP-driven inventory drawdown and higher cost headwinds.
1. What happened
Clorox (CLX) is trading lower after releasing third-quarter fiscal 2026 results (quarter ended March 31, 2026) and updating its full-year outlook. The key negative for investors was the reset to full-year profitability expectations, which outweighed quarter-specific profit metrics and kept focus on near-term earnings power.
2. The new outlook that spooked investors
Clorox now expects fiscal 2026 net sales to be down about 6% and organic sales to fall about 9%. The company cut its fiscal 2026 EPS outlook to diluted EPS of $4.78–$4.98 and adjusted EPS of $5.45–$5.65, and also guided to a larger gross-margin decline (down 250–300 basis points) than previously expected. (stocktitan.net)
3. What management says is driving the downgrade
Clorox framed the biggest driver as a transitory shipment/consumption mismatch tied to its ERP transition: retailers previously built inventory ahead of the system change, and the subsequent drawdown is pressuring reported shipments and earnings comparisons. The company quantified the earnings impact from this inventory drawdown at roughly $0.90 per share for fiscal 2026. (stocktitan.net)
4. Other moving parts: GOJO (Purell) integration and cost headwinds
The outlook also incorporates the recently closed GOJO acquisition (Purell), which Clorox expects to add to reported sales but bring near-term EPS dilution and transaction-related costs, while costs such as energy, manufacturing, and logistics remain a margin overhang. The GOJO deal closed April 1, 2026, expanding Clorox into the Purell brand and related health and hygiene offerings. ()
