Analysis of Profitability Ratios
Quarterly Data
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Income Statement
- Statement of Comprehensive Income
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Solvency Ratios
- Analysis of Long-term (Investment) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Enterprise Value to EBITDA (EV/EBITDA)
- Present Value of Free Cash Flow to Equity (FCFE)
- Operating Profit Margin since 2005
- Price to Sales (P/S) since 2005
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Profitability Ratios (Summary)
Procter & Gamble Co., profitability ratios (quarterly data)
Based on: 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), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
The profitability ratios demonstrate a generally stable performance with some fluctuations over the observed period. Gross profit margin, operating profit margin, and net profit margin all exhibited a degree of cyclicality, while return on equity and return on assets showed a more consistent, albeit subtly shifting, pattern.
- Gross Profit Margin
- The gross profit margin began at 50.78% in September 2020 and generally decreased through December 2022, reaching a low of 46.60%. A recovery commenced in March 2023, peaking at 51.41% in September 2024 before slightly declining to 50.68% by December 2025. This suggests potential shifts in cost of goods sold relative to revenue, or changes in product mix.
- Operating Profit Margin
- Similar to the gross profit margin, the operating profit margin experienced a decline from 23.04% in September 2020 to 21.61% in December 2022. It then showed a strengthening trend, rising to 23.57% in September 2024, before a slight decrease to 23.62% in December 2025. This indicates fluctuations in operating expenses alongside revenue changes.
- Net Profit Margin
- The net profit margin followed a comparable pattern, starting at 18.92% and decreasing to 17.79% by December 2022. A subsequent increase brought it to 19.30% in December 2024, followed by a minor decline to 19.74% in March 2025 and 19.30% in December 2025. This reflects the combined impact of gross profit, operating expenses, and other income/expenses.
- Return on Equity (ROE)
- Return on equity demonstrated a more consistent performance, generally remaining above 30% throughout the period. It peaked at 32.52% in December 2021 and experienced a slight dip to 30.43% in September 2023, before recovering to 31.02% in December 2025. This suggests effective utilization of shareholder equity to generate profits.
- Return on Assets (ROA)
- Return on assets also exhibited relative stability, fluctuating between approximately 11.44% and 13.14%. A general upward trend was observed from September 2020 to March 2025, peaking at 13.14%, followed by a slight decrease to 12.93% in December 2025. This indicates the efficiency with which assets are employed to generate earnings.
Overall, the observed trends suggest a business that has navigated changing economic conditions while maintaining a relatively strong profitability profile. The cyclical patterns in the margin ratios warrant further investigation to understand the underlying drivers, while the consistent ROE and ROA indicate effective capital management.
Return on Sales
Return on Investment
Gross Profit Margin
Procter & Gamble Co., gross profit margin calculation (quarterly data)
Based on: 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), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
1 Q2 2026 Calculation
Gross profit margin = 100
× (Gross profitQ2 2026
+ Gross profitQ1 2026
+ Gross profitQ4 2025
+ Gross profitQ3 2025)
÷ (Net salesQ2 2026
+ Net salesQ1 2026
+ Net salesQ4 2025
+ Net salesQ3 2025)
= 100 × ( + + + )
÷ ( + + + )
=
The gross profit margin exhibited fluctuations over the observed period, beginning in September 2020 and extending through December 2025. Initially, the margin demonstrated a period of relative stability, followed by a discernible downward trend, and then a subsequent recovery.
- Initial Period (Sep 2020 – Dec 2020)
- The gross profit margin began at 50.78% in September 2020 and increased to 51.26% by December 2020. This represents a slight positive movement, indicating improved profitability from core operations during this timeframe.
- Downward Trend (Mar 2021 – Dec 2022)
- From March 2021 through December 2022, a consistent downward trend in the gross profit margin was observed. Starting at 51.57% in March 2021, the margin declined to 46.60% by December 2022. This suggests increasing costs of goods sold relative to net sales, potentially due to factors such as rising input prices, manufacturing inefficiencies, or increased promotional activity.
- Recovery and Stabilization (Mar 2023 – Dec 2025)
- Beginning in March 2023, the gross profit margin began to recover. It rose from 46.96% to 50.36% by December 2023, and continued to fluctuate between approximately 50.68% and 51.41% through December 2025. While not returning to the levels seen in the initial period, this indicates a stabilization and improvement in profitability following the earlier decline. The most recent value, 50.68% in December 2025, is slightly lower than the value in September 2025 (50.98%).
- Peak and Trough
- The highest gross profit margin recorded during the period was 51.57% in March 2021. The lowest recorded margin was 46.60% in December 2022, representing a difference of 4.97 percentage points.
Overall, the gross profit margin demonstrates a cyclical pattern of initial stability, decline, and eventual recovery. The period of decline warrants further investigation to understand the underlying cost pressures impacting profitability. The subsequent recovery suggests successful implementation of cost management strategies or favorable shifts in the business environment.
Operating Profit Margin
Procter & Gamble Co., operating profit margin calculation (quarterly data)
Based on: 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), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
1 Q2 2026 Calculation
Operating profit margin = 100
× (Operating incomeQ2 2026
+ Operating incomeQ1 2026
+ Operating incomeQ4 2025
+ Operating incomeQ3 2025)
÷ (Net salesQ2 2026
+ Net salesQ1 2026
+ Net salesQ4 2025
+ Net salesQ3 2025)
= 100 × ( + + + )
÷ ( + + + )
=
The operating profit margin exhibited relative stability over the observed period, generally fluctuating between 21.61% and 24.26%. Initial values demonstrated a slight increase from 23.04% in September 2020 to 23.94% in March 2021, before experiencing a moderate decline through the first half of 2022.
- Overall Trend
- From June 2022 through December 2023, the operating profit margin remained within a narrow range, oscillating between approximately 21.61% and 22.77%. A noticeable upward trend emerged in the latter half of 2024, culminating in a peak of 24.26% in June 2025, followed by a slight decrease to 23.62% in September 2025 and a further decrease to 23.62% in December 2025.
- Short-Term Fluctuations
- Quarterly variations were present throughout the period. For instance, a dip was observed from March 2021 (23.94%) to June 2021 (22.98%). Similarly, a decline occurred between September 2021 (22.98%) and June 2022 (22.21%). These fluctuations appear to correlate with changes in operating income and net sales, though the relationship isn't always directly proportional.
- Recent Performance
- The most recent quarters show a strengthening of the operating profit margin, increasing from 22.07% in June 2024 to 24.26% in June 2025. This suggests improved operational efficiency or pricing power during this period. However, the margin decreased slightly in the subsequent two quarters, indicating a potential shift in these dynamics.
The operating profit margin demonstrates a generally healthy and consistent performance, with recent gains potentially indicating positive developments in the company’s operational performance. Continued monitoring is recommended to assess the sustainability of these recent improvements and understand the drivers behind the observed fluctuations.
Net Profit Margin
Procter & Gamble Co., net profit margin calculation (quarterly data)
Based on: 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), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
1 Q2 2026 Calculation
Net profit margin = 100
× (Net earnings attributable to Procter & Gamble (P&G)Q2 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q1 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q4 2025
+ Net earnings attributable to Procter & Gamble (P&G)Q3 2025)
÷ (Net salesQ2 2026
+ Net salesQ1 2026
+ Net salesQ4 2025
+ Net salesQ3 2025)
= 100 × ( + + + )
÷ ( + + + )
=
The net profit margin exhibited a generally stable pattern over the analyzed period, ranging between approximately 17% and 19%. However, closer examination reveals discernible fluctuations and a potential emerging trend towards the end of the period.
- Initial Period (Sep 30, 2020 – Dec 31, 2021)
- From September 30, 2020, through December 31, 2021, the net profit margin remained relatively consistent, fluctuating between 18.33% and 18.97%. This suggests a period of stable profitability, with minimal impact from changes in either net earnings or net sales.
- Mid-Period Volatility (Mar 31, 2022 – Jun 30, 2023)
- The period from March 31, 2022, to June 30, 2023, demonstrated increased volatility. The net profit margin decreased to a low of 17.60% in June 2023, indicating a potential compression of profitability. This decline coincided with fluctuations in both net earnings and net sales, suggesting a sensitivity to revenue changes.
- Recent Trend (Sep 30, 2023 – Jun 30, 2025)
- A potential upward trend is observable in the most recent quarters. The net profit margin increased from 18.30% in September 2023 to 19.74% in September 2025. This improvement suggests enhanced profitability, potentially driven by cost management or increased pricing power. The margin peaked at 19.74% in September 2025, before slightly decreasing to 19.30% in December 2025 and 18.95% in June 2025.
- Overall Observations
- While the net profit margin has generally remained within a narrow range, the recent increase warrants further investigation. The company appears to have navigated periods of revenue fluctuation effectively, maintaining a generally healthy profit margin. The recent upward trend, if sustained, could indicate improved operational efficiency or a favorable shift in the competitive landscape.
Return on Equity (ROE)
Procter & Gamble Co., ROE calculation (quarterly data)
Based on: 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), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
1 Q2 2026 Calculation
ROE = 100
× (Net earnings attributable to Procter & Gamble (P&G)Q2 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q1 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q4 2025
+ Net earnings attributable to Procter & Gamble (P&G)Q3 2025)
÷ Shareholders’ equity attributable to Procter & Gamble
= 100 × ( + + + )
÷ =
The Return on Equity (ROE) for the analyzed period demonstrates a generally strong and relatively stable performance, with some fluctuations. Overall, the ROE consistently remained above 28% throughout the observed timeframe, indicating efficient utilization of shareholder investments to generate profits.
- Initial Period (Sep 30, 2020 – Dec 31, 2021)
- The ROE exhibited an initial increase from 28.46% to 32.52% over this period. This growth suggests improving profitability relative to equity, potentially driven by increased net earnings or efficient equity management. A slight peak was observed in December 2021 at 32.52%.
- Subsequent Fluctuations (Mar 31, 2022 – Jun 30, 2023)
- Following the peak, the ROE experienced a period of fluctuation, ranging between 31.33% and 32.09%. While remaining robust, this period indicates a stabilization after the earlier growth. A slight decline was noted in June 2023, reaching 31.33%.
- Recent Trends (Sep 30, 2023 – Jun 30, 2025)
- The most recent portion of the period shows a more noticeable downward trend, with the ROE decreasing from 31.94% in September 2023 to 29.59% in June 2025. Although still above 29%, this decline warrants attention. A low point was reached in June 2025 at 29.59%, followed by a slight recovery to 30.71% and 31.47% in subsequent quarters. The latest value, 31.02% in December 2025, remains below the highs observed earlier in the analyzed timeframe.
- Relationship to Net Earnings and Equity
- The ROE movements generally correlate with changes in net earnings attributable to the company. Periods of higher net earnings typically coincide with higher ROE values, and vice versa. Shareholders’ equity remained relatively stable, with a gradual increase over the period, suggesting that changes in ROE are primarily driven by fluctuations in profitability rather than significant shifts in the equity base.
In conclusion, while the ROE has historically been strong, the recent downward trend suggests a potential weakening in profitability relative to equity. Continued monitoring of both net earnings and shareholders’ equity will be crucial to understanding the underlying drivers of this trend and its potential implications.
Return on Assets (ROA)
Procter & Gamble Co., ROA calculation (quarterly data)
Based on: 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), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
1 Q2 2026 Calculation
ROA = 100
× (Net earnings attributable to Procter & Gamble (P&G)Q2 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q1 2026
+ Net earnings attributable to Procter & Gamble (P&G)Q4 2025
+ Net earnings attributable to Procter & Gamble (P&G)Q3 2025)
÷ Total assets
= 100 × ( + + + )
÷ =
The Return on Assets (ROA) for the analyzed period demonstrates a generally stable and healthy performance, with some fluctuations. Overall, the ROA consistently remains in the double-digit percentage range, indicating efficient asset utilization in generating profits. A closer examination reveals distinct phases in the observed trend.
- Initial Period (Sep 30, 2020 – Dec 31, 2021)
- The ROA begins at 11.44% and experiences a slight increase to 11.53% before peaking at 12.16%. It then settles around the 11.82% to 11.95% range, suggesting a period of consistent, though not dramatically improving, asset efficiency. The fluctuations within this period are relatively minor.
- Subsequent Increase (Mar 31, 2022 – Jun 30, 2022)
- A noticeable increase in ROA is observed, rising from 12.14% to a high of 12.58% and then remaining at 12.53%. This suggests improved profitability relative to the asset base during this six-month period.
- Mid-Term Stability (Sep 30, 2022 – Dec 31, 2023)
- The ROA experiences a slight decline to 12.13% and then fluctuates between 11.95% and 12.43% over the next four quarters. This indicates a period of relative stability, with the ROA remaining within a narrow band.
- Recent Performance (Mar 31, 2024 – Dec 31, 2025)
- The ROA demonstrates a strengthening trend, increasing from 12.65% to 13.14% and then settling around 12.93% to 12.76%. This recent performance suggests a renewed improvement in the company’s ability to generate earnings from its assets. The final reported value of 12.76% indicates continued strong asset utilization.
In summary, the ROA exhibits a generally positive trend over the analyzed period. While some quarterly fluctuations are present, the overall pattern suggests effective management of assets to generate consistent profitability. The recent increase in ROA is a particularly encouraging sign, indicating potential improvements in operational efficiency or asset allocation strategies.