Earnings Call Intelligence Subscribe
Home › Call Sheets › CL › Q2'26
Call sheet · Q2'26

Colgate-Palmolive (CL)

Q2'26 earnings call · held July 31, 2026 · compared with the Q1'26 call · management-credibility review
3/12
Disclosure score
1 high, 5 medium, 2 low flags
Financial quality
Bottom line
The sleeper story is that Colgate is getting squeezed in a vice: retailers are cutting inventory while competitors coupon aggressively, creating a 400 bps shipment/consumption gap that explains the North America disaster. The $300M cost bomb is real but manageable; what's not manageable is their premium pricing strategy when they're losing shelf space. The binding constraint isn't costs or innovation, it's that retailers don't believe Colgate drives traffic anymore. Management's tell: 'We can't be uncompetitive in terms of pricing and promotion, but we want to be sure that we're not leading that further down.' Translation: they know they need to cut price but won't. My view changes if North America shipments converge with consumption by Q4, proving retailers are restocking.

The 30-second version

  • North America inventory destocking masks a deeper problem: consumption tracking at +1% while shipments down 3%
  • The $300M raw material inflation bomb gets absorbed with a shrug, but that's $1.2B annualized
  • Hills Fresh launch deliberately throttled to protect 60%+ gross margins on dry food

What changed this quarter

MetricQ1'26Q2'26Change
Organic Sales Growth2.5% (Q1 2026)2.6% (Q2 2026)+10 bps acceleration
North America Organic Sales-1% (Q1 2026)-3% (Q2 2026)200 bps deterioration
Emerging Markets Organic Sales6% (Q1 2026)~5.5% ('mid-single digits')50 bps deceleration
Gross Margin (guidance)Flat to up (Q1 guidance)Flat to down (Q2 guidance)Guidance cut
Raw Material Inflation Impact$0M incremental (Q1)$300M incremental (Q2)Massive cost surprise
Free Cash FlowNot disclosed (Q1)+18% YoYStrong conversion
Hills Pet Organic Sales (ex-private label)4.8% (Q1 2026)4.0% (Q2 2026)80 bps deceleration
China Organic SalesNot specified (Q1)Mid-single digitsContinued recovery
Advertising as % of Sales14.0% (Q1 2026)14.0%+ (double-digit increase)Maintained elevation
Volume Growth (global)Positive all divisions (Q1)Positive 4 of 5 divisionsNorth America volume negative

Accountability tracked

7 new promises made5 narrative shifts flagged7 prior promises scored
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
Read the full CL Q2'26 report Subscribe
About Research ↗Call SheetsCredibility IndexMissed PromisesScreens13F BooksData & InstitutionalPrivacyTermsSubscribe
This is a free preview. The full write-up and promise ledger are published to subscribers on Substack.
Scores, kept-promise rates, and flags on this site reflect the author's opinion, applying a stated methodology to statements management made on public earnings calls. Informational and educational purposes only - not investment advice, a recommendation, or an offer to buy or sell any security. Sources believed reliable but not guaranteed; the author may hold positions in the securities discussed.

Follow what management promises next

Get free previews of our earnings-call research: the key changes, management scores, and questions worth investigating. Subscribe for full call sheets and deeper analysis.

Subscriptions are managed by Substack. If the form does not load, subscribe directly. Or follow the RSS feed.