Get 40% Off
💰 Buffett reveals a $6.7B stake in Chubb. Copy the full portfolio for FREE with InvestingPro’s Stock Ideas toolCopy Portfolio

Tylenol maker Kenvue to cut 4% jobs, beats quarterly profit estimates

Published 05/07/2024, 06:47 AM
Updated 05/07/2024, 08:26 AM
© Reuters. The company logo for Kenvue Inc. Johnson & Johnson's consumer-health business, is displayed on during the company's IPO at the New York Stock Exchange (NYSE) in New York City, U.S., May 4, 2023.  REUTERS/Brendan McDermid/File Photo
JNJ
-

(Reuters) -Kenvue will cut 4% of its global workforce amid investments to grow its key brands, the Tylenol and Band-Aid maker said on Tuesday, as it topped beat Wall Street estimates for first-quarter profit.

Since its spinoff from Johnson & Johnson (NYSE:JNJ) last year, Kenvue (NYSE:KVUE) has focused on its 15 priority brands and in February announced it would increase its advertising spending this year.

The company said on Tuesday it targets pre-tax gross savings of about $350 million annually by 2026 through the cost-cutting program, but will incur $275 million each in restructuring expenses in 2024 and 2025.

The consumer health firm had 22,000 employees as of December end, according to its annual report.

Kenvue posted an adjusted profit of 28 cents per share for the first quarter, beating analysts' estimates of 26 cents.

"Given where investor expectations are for (Kenvue), we believe this was a solid overall print and its least noisy since becoming a public company," RBC Capital Markets analyst Nik Modi said in a note.

Kenvue's stock is down 11% so far this year, and 13% from its IPO price since listing in May last year. Shares were up 2.3% in premarket trading on Tuesday.

The self-care segment - which includes cough and cold medicine such as Tylenol and Benadryl - recorded $1.70 billion in net sales, up 3.5% year-on-year and above the average analyst estimate of $1.56 billion, according to LSEG data.

Kenvue's skin health and beauty segment, consisting of brands including Neutrogena and Clean & Clear, recorded a 5% drop in first-quarter net sales to $1.05 billion, but largely in line with estimates.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

The company has pushed to improve the presence of its skin health products on store shelves in the U.S. as it looks to reverse sluggish sales over the last few quarters.

The New Jersey-based company posted first-quarter revenue of $3.89 billion, beating estimates of $3.79 billion.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.