Newell Brands Inc. ((NWL)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Newell Brands Inc. recently held its earnings call, revealing a mixed sentiment. While the company showcased positive strides in cost management, innovation, and financial health, it also faced significant hurdles such as declining sales due to tariffs and international market slowdowns, alongside competitive pricing pressures in key segments.
Successful Cost Management
Newell Brands reported a notable achievement in cost management, with normalized overheads as a percent of sales declining by approximately 120 basis points year-over-year. This marks the first reduction in three years, attributed to savings from realignment plans and technology investments.
Strong Innovation Pipeline
The company is gearing up to launch over 20 Tier 1 or Tier 2 propositions in 2026, receiving positive feedback from retailers. This development is touted as the strongest innovation portfolio Newell Brands has seen in over a decade.
Improved Financial Health
Newell Brands ended the quarter with net debt at $4.5 billion, a reduction from the previous year. Additionally, the leverage ratio dropped by 20 basis points compared to the second quarter, indicating improved financial health.
Positive Outlook in Writing and Baby Segments
Despite pricing pressures, the Writing and Baby segments demonstrated resilience, showing strong innovation and market share gains.
Significant Sales Decline
The company faced a 7% decline in core and net sales, driven by lower retailer inventory levels, international market slowdowns, and aggressive pricing for tariffs.
Impact of Tariffs
Newell anticipates $180 million in incremental cash tariff costs for the year, an increase from the previous estimate of $155 million, affecting both profitability and sales.
International Market Challenges
Key international markets, particularly Brazil and Argentina, experienced slowdowns, with Brazil’s market down 25% due to macroeconomic disruptions.
Pricing Scrape in Kitchen Segment
In the kitchen segment, competitors did not match Newell’s pricing, leading to uncompetitive pricing and impacting sales.
Forward-Looking Guidance
Despite the challenging macroeconomic environment in the third quarter of 2025, Newell Brands remains optimistic about future growth. The company expects net distribution gains to surpass losses starting in the fourth quarter and anticipates a return to growth in its international business, which makes up roughly 40% of total sales. Additionally, Newell Brands looks forward to improved competitive positioning due to its strong domestic manufacturing presence and robust innovation pipeline for 2026.
In summary, Newell Brands Inc.’s earnings call highlighted a balanced view of its current standing. While the company is making significant progress in cost management and innovation, it faces ongoing challenges from declining sales and international market slowdowns. However, with strategic initiatives and a strong innovation pipeline, Newell Brands is poised for future growth.