Analysis of Profitability Ratios
Quarterly Data
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Balance Sheet: Liabilities and Stockholders’ Equity
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Common Stock Valuation Ratios
- Enterprise Value (EV)
- Dividend Discount Model (DDM)
- Return on Equity (ROE) since 2005
- Return on Assets (ROA) since 2005
- Price to Sales (P/S) since 2005
- Analysis of Revenues
- Aggregate Accruals
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Profitability Ratios (Summary)
Procter & Gamble Co., profitability ratios (quarterly data)
Based on: 10-K (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30).
Profitability metrics exhibit a period of initial compression followed by a sustained recovery and stabilization. While margins faced downward pressure throughout 2021 and 2022, a subsequent upward trend indicates successful cost management or pricing adjustments, with most ratios returning to or exceeding their initial levels by the end of the analyzed period.
- Gross Profit Margin
- A U-shaped trend is evident, starting at 50.31% and declining to a low of 46.60% by December 31, 2022. This was followed by a consistent recovery, peaking at 51.41% in September 2024 before stabilizing around 50.18% by June 30, 2026. This pattern suggests a period of increased cost of goods sold that was effectively mitigated over the subsequent two years.
- Operating Profit Margin
- Operating margins remained relatively stable, fluctuating within a tight range between 21.61% and 24.26%. A slight contraction occurred in late 2022, but margins expanded to a peak of 24.26% in June 2025, indicating strong operational efficiency and control over overhead expenses despite fluctuations in gross profit.
- Net Profit Margin
- The net profit margin demonstrated resilience, generally oscillating between 17% and 20%. A notable dip to 17.06% was recorded in September 2024, which was quickly reversed to reach a period high of 19.74% in September 2025. The margin concluded the period at 18.44%, maintaining a consistent bottom-line performance.
- Return on Equity (ROE)
- ROE remained high throughout the period, typically hovering around 30%. It reached a peak of 33.06% in September 2022 before experiencing a decline to 27.62% in September 2024. A recovery followed, with the ratio ending at 29.67%, reflecting a strong and consistent ability to generate profits from shareholders' equity.
- Return on Assets (ROA)
- ROA exhibited the lowest volatility of all analyzed ratios, remaining largely within the 11% to 13% range. After a low of 11.32% in September 2024, the ratio climbed to a peak of 13.14% in September 2025, concluding at 12.68%. This suggests steady and efficient utilization of the asset base to drive earnings.
Overall, the financial trajectory indicates a strong recovery phase starting in 2023. The synchronization of the recovery across gross, operating, and net margins suggests that the company successfully navigated external cost pressures to restore its profitability profile.
Return on Sales
Return on Investment
Gross Profit Margin
Procter & Gamble Co., gross profit margin calculation (quarterly data)
Based on: 10-K (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30).
1 Q4 2026 Calculation
Gross profit margin = 100
× (Gross profitQ4 2026
+ Gross profitQ3 2026
+ Gross profitQ2 2026
+ Gross profitQ1 2026)
÷ (Net salesQ4 2026
+ Net salesQ3 2026
+ Net salesQ2 2026
+ Net salesQ1 2026)
= 100 × ( + + + )
÷ ( + + + )
=
The gross profit margin exhibits a distinct cyclical trajectory over the analyzed period, characterized by an initial contraction, a period of robust recovery and expansion, and a subsequent gradual normalization.
- Margin Compression Phase
- A consistent downward trend is observed from September 2021 through December 2022. The gross profit margin declined from 50.31% to a period low of 46.60%. This erosion occurred while net sales remained relatively stable, indicating that the cost of goods sold increased at a faster rate than revenue growth during this interval.
- Recovery and Peak Expansion
- A reversal of the downward trend began in March 2023, initiating a sustained upward trajectory. The margin climbed steadily from 46.96% in March 2023, surpassing the initial 50% threshold by December 2023. This growth culminated in a peak margin of 51.41% in September 2024, suggesting effective pricing strategies or optimized production costs.
- Stabilization and Marginal Decline
- From December 2024 through June 2026, the gross profit margin entered a phase of gradual contraction. The margin decreased incrementally from 51.34% to 50.18%. This movement indicates a stabilization of profitability, as the margin returned toward a baseline level similar to that observed at the start of the analyzed period.
In summary, the data reveals a period of volatility where profitability was pressured in 2022, recovered strongly through 2024, and eventually stabilized around the 50% mark by mid-2026.
Operating Profit Margin
Procter & Gamble Co., operating profit margin calculation (quarterly data)
Based on: 10-K (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30).
1 Q4 2026 Calculation
Operating profit margin = 100
× (Operating incomeQ4 2026
+ Operating incomeQ3 2026
+ Operating incomeQ2 2026
+ Operating incomeQ1 2026)
÷ (Net salesQ4 2026
+ Net salesQ3 2026
+ Net salesQ2 2026
+ Net salesQ1 2026)
= 100 × ( + + + )
÷ ( + + + )
=
The operating profit margin exhibits a cyclical pattern characterized by an initial period of contraction, a significant mid-term expansion, and a subsequent gradual normalization.
- Margin Compression (2021-2022)
- From September 30, 2021, to December 31, 2022, a consistent downward trend is observed, with the operating profit margin declining from 22.98% to a low of 21.61%. This compression occurred while net sales remained relatively stable, fluctuating between approximately 19.3 billion and 20.9 billion US dollars, suggesting a rise in operating costs during this interval.
- Recovery and Mid-Term Stability (2023-2024)
- A recovery phase emerged starting in early 2023, where margins stabilized and began to fluctuate between 21.70% and 22.77%. A peak in operational efficiency was noted in September 2023, where operating income reached 5,767 million US dollars against net sales of 21,871 million US dollars.
- Peak Expansion Period (2024-2025)
- The most pronounced growth in profitability occurred between December 31, 2023, and June 30, 2025. During this period, the operating profit margin climbed steadily from 22.17% to a peak of 24.26%. This expansion was supported by a general increase in net sales, which reached a high of 22,386 million US dollars by September 30, 2025, alongside strong operating income levels.
- Normalization Trend (2025-2026)
- Following the peak in mid-2025, a gradual decline is evident through June 30, 2026, with the margin receding from 24.26% to 22.69%. Despite this decrease, the margin remains above the levels recorded during the 2022-2023 period, indicating a stabilization at a slightly higher efficiency threshold than the historical baseline.
Net Profit Margin
Procter & Gamble Co., net profit margin calculation (quarterly data)
Based on: 10-K (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30).
1 Q4 2026 Calculation
Net profit margin = 100
× (Net earnings attributable to Procter & Gamble (P&G)Q4 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q3 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q2 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q1 2026)
÷ (Net salesQ4 2026
+ Net salesQ3 2026
+ Net salesQ2 2026
+ Net salesQ1 2026)
= 100 × ( + + + )
÷ ( + + + )
=
The net profit margin exhibits a period of relative stability followed by moderate volatility and a subsequent peak before returning to historical averages. Between September 2021 and June 2022, the margin remained consistent, fluctuating narrowly between 18.33% and 18.52%.
- Margin Compression and Volatility
- A gradual decline in profitability is observed starting in September 2022, with the margin reaching a cyclical low of 17.06% in June 2024. This period was characterized by fluctuations in net earnings despite net sales remaining relatively stable, generally staying within the $19 billion to $21 billion range.
- Profitability Expansion
- A significant recovery in the net profit margin occurred during the latter half of 2024 and throughout 2025. The margin reached its highest recorded point of 19.74% in September 2025, coinciding with a peak in net sales of $22,386 million and net earnings of $4,750 million.
- Recent Performance Trends
- Following the peak in late 2025, a moderating trend is evident. The net profit margin declined from 19.74% in September 2025 to 18.44% by June 2026, effectively returning to the baseline levels observed at the start of the analyzed period.
The relationship between net sales and net earnings indicates that the margin expansion seen in 2025 was driven by earnings growth that outpaced the increase in revenue. Conversely, the margin compression observed in early 2024 was a result of decreased net earnings during a period where sales remained resilient.
Return on Equity (ROE)
Procter & Gamble Co., ROE calculation (quarterly data)
Based on: 10-K (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30).
1 Q4 2026 Calculation
ROE = 100
× (Net earnings attributable to Procter & Gamble (P&G)Q4 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q3 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q2 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q1 2026)
÷ Shareholders’ equity attributable to Procter & Gamble
= 100 × ( + + + )
÷ =
The profitability metrics indicate a period of relative stability in efficiency, characterized by a consistent Return on Equity (ROE) despite significant quarterly fluctuations in net earnings and a steady increase in the total equity base.
- Net Earnings Volatility
- Net earnings attributable to the company exhibit a cyclical quarterly pattern. Earnings peaked at US$ 4,750 million in September 2025, while the lowest performance was recorded in June 2026 at US$ 3,045 million. A recurring trend is observed where the third and fourth quarters of the calendar year typically yield higher earnings compared to the second quarter.
- Shareholders' Equity Growth
- A consistent upward trend in shareholders' equity is observed over the analyzed period. The equity base expanded from US$ 46,111 million in September 2021 to US$ 54,081 million by June 2026. This growth reflects a steady accumulation of capital, which increases the financial base against which profitability is measured.
- Return on Equity (ROE) Performance
- The ROE remained within a tight range, primarily between 27.62% and 33.06%. A peak was reached in September 2022 at 33.06%, followed by a gradual contraction that bottomed out at 27.62% in September 2024. From late 2024 through June 2026, the ROE stabilized around the 30% mark. The observed marginal decline in the ratio over the long term suggests that the growth in shareholders' equity has occasionally outpaced the growth in net earnings, creating a slight dilution in the return generated per unit of equity.
Return on Assets (ROA)
Procter & Gamble Co., ROA calculation (quarterly data)
Based on: 10-K (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30).
1 Q4 2026 Calculation
ROA = 100
× (Net earnings attributable to Procter & Gamble (P&G)Q4 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q3 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q2 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q1 2026)
÷ Total assets
= 100 × ( + + + )
÷ =
The return on assets (ROA) exhibits a general upward trajectory over the analyzed period, demonstrating consistent efficiency in generating earnings from the asset base. While quarterly fluctuations are present, the ROA moved from 11.82% in September 2021 to a peak of 13.14% in September 2025, before settling at 12.68% by June 2026.
- Net Earnings Volatility
- Net earnings attributable to the company show significant quarterly variance. A cyclical pattern is observable, with notable peaks occurring in September 2023 (US$ 4,521 million), December 2024 (US$ 4,630 million), and September 2025 (US$ 4,750 million). Conversely, periodic dips are evident, such as in June 2022 (US$ 3,052 million) and June 2026 (US$ 3,045 million), which correlate with temporary contractions in the ROA.
- Asset Base Evolution
- Total assets remained relatively stable with a gradual expansionary trend. The asset base grew from US$ 119,669 million in September 2021 to US$ 126,521 million by June 2026. This steady growth indicates a controlled expansion of the balance sheet, avoiding aggressive spikes that could have diluted the return on assets.
- ROA Performance and Stability
- The ROA maintained a tight range between 11.32% and 13.14%, signaling high operational stability. A period of relative stability was observed between September 2021 and March 2023, with values hovering around 12%. A subsequent increase in efficiency is noted starting in March 2024, leading to a sustained period where the ratio remained above 12.6% for several consecutive quarters, peaking in late 2025. The lowest point of 11.32% in September 2024 represents a short-term deviation rather than a systemic decline.
Overall, the correlation between rising net earnings and a slowly expanding asset base has resulted in an improved long-term ROA profile. The ability to maintain a return above 12% across multiple years indicates a robust capacity to optimize asset utilization despite quarterly fluctuations in profitability.