Tariff turmoil: What P&G, Pepsi and other companies are saying about tariffs
Tariff worries continue hanging over companies as they report their latest financial results and try to provide guidance on their path ahead.
Some tariffs remain in place against key U.S. trading partners, but others have been postponed to give nations time to negotiate. The tariff and trade picture continues shifting and that makes it difficult for companies and investors to make a reliable assessment of any impact to costs and sales.
Seemingly few industries or companies are being spared from the uncertainty. Food and beverage businesses, pharmaceutical companies, and makers of household staples are among the many companies trying to gauge the potential impact to costs and sales.
A new poll by The Associated Press-NORC Center for Public Affairs Research shows that companies are right to be focused on tariffs. About 6 in 10 U.S. adults are "extremely" or "very" concerned about the cost of groceries in the next few months, while about half are highly concerned about the cost of big purchases, such as a car, cellphone or appliance
Here's what companies are saying about tariffs and their potential impact:
Procter & Gamble Procter & Gamble, the maker of such products as Crest toothpaste, Tide detergent and Charmin toilet paper, said Thursday said it's doing whatever it can to reduce higher costs from President Donald Trump's expansive tariffs from shifting sourcing to changing formulation to avoid duties.
But P&G's Chief Financial Officer Andre Schulten told reporters on a call that the consumer products giant still will likely have to pass on higher prices to shoppers as early as July.
The consumer product giant reduced its annual financial outlook after reporting lower sales, particularly in the U.S. and Western Europe, during the latest quarter, due to a pullback in consumer spending over worries about tariffs as well as overall financial worries about job security and mortgage rates.
"Everything plays into the consumer behavior," Schulten said. "Uncertainty around the stock market and what their 401ks are worth and what the portfolio is worth. Uncertainty around the economic outlook and what it means for their livelihood and the job market."
Pepsi PepsiCo lowered its full-year earnings expectations, citing increased costs from tariffs and a pullback in consumer spending.
The maker of Pepsi beverages and Frito-Lay snacks said it now expects its core earnings per share to be even with last year. Previously it expected mid-single-digit percentage growth.
A 25% tariff on imported aluminum is among those hitting PepsiCo and other beverage makers. The company expects "elevated levels of volatility and uncertainty" for the rest of this year.
Merck Merck trimmed its earnings forecast for the year, though it maintained its guidance for revenue.
The pharmaceutical giant has a global reach. Half of its revenue comes from the U.S. market, with the rest of the world making up the other half, according to FactSet. The company expects tariffs already implemented to cost the company about USD 200 million.
American Airlines American Airlines withdrew its earnings forecast for the year amid uncertainty over the economy.
While tariffs might not directly impact airlines and other companies in the travel sector, they could prompt a shift in consumer spending. Tariffs typically make goods more expensive and that might force consumers to tighten their budgets and focus more on necessities, while cutting back on discretionary items and services, such as travel.
Southwest Airlines Southwest Airlines is trimming its flight schedule for the second half of the year due to lower demand. The company also said it could not reaffirm its 2025 and 2026 outlooks for earnings before interest and taxes, given "current macroeconomic uncertainty."
Dow Chemical company Dow expects to see delays in purchases from businesses and consumers amid tariff-driven economic uncertainty.
"Markets worldwide are awaiting additional clarity into how the tariff and global trade negotiations will land," said CEO Jim Fitterling, in a statement.
The company is delaying construction of a facility in Alberta, Canada and expects capital expense savings of about USD 1 billion from that decision. It is also expanding an ongoing review of its assets in Europe, including facilities in Germany and the U.K.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Economic Times
26 minutes ago
- Economic Times
US stock futures, dollar dip on tariff threat
Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads US equity-index futures dipped along with the dollar after President Donald Trump said he will set unilateral tariff rates within two weeks, dialing up trade tensions once again. Oil jumped on tensions in the Middle for the S&P 500 and the Nasdaq 100 fell 0.2% after Trump said he will send letters to countries setting tariff rates within the next two weeks. The dollar weakened against all of its Group-of-10 peers with the yen among the biggest gainers. Gold rose as much as 0.6% on demand for safe havens. Asian shares were mixed at the extended its biggest daily gain since October after the US ordered some staff to depart its Baghdad embassy and allowed military service members' families to leave the Middle East amid rising security risks. West Texas Intermediate rose as much as 1.7% to $69.29 after jumping 4.9% it's unclear if Trump will follow through with his pledge - the president has often set two-week deadlines for actions, only for them to come later or not at all. The comments come a day after Chinese and US officials struck a positive tone following their talks to dial down trade tensions. Amid US talking with countries including India and Japan to lower the levies, some investors see Trump's comments as an effort to ramp up urgency in talks.'Common sense would suggest this is another Trump strategy to increase urgency in trade negotiations,' said Rodrigo Catril, senior foreign exchange strategist at National Australia Bank Ltd. 'Trump wants trade deals and he wants them sooner rather than later.'Stocks have steadied in recent weeks and an index of global equities is hovering near a record after recovering from their lows in April when Trump announced the highest US levies in a century in an effort to rewrite global trade. The MSCI All Country World Index hit a record S&P 500 index fell 0.3% Wednesday and the Nasdaq 100 dropped 0.4% as big tech weighed on US benchmarks. Softer-than-expected US inflation supported the case for Federal Reserve rate cuts, spurring Treasuries higher. A solid $39 billion sale of 10-year debt also helped the bonds. The advance was led by shorter maturities, with two-year yields dropping below 4%.Earlier, Trump said a trade framework with China has been completed, with Beijing supplying rare earths and magnets up front and the US allowing Chinese students into its colleges and universities. The US and China will maintain tariffs at their current, lower levels following the two nations' agreement this week in London, Trump said US core inflation rose in May by less than forecast, suggesting companies are largely holding back on passing higher tariff costs through to string of below-forecast inflation readings adds to evidence that consumers have yet to feel the pinch of tariffs — perhaps because the most punitive levies have temporarily been on pause, or thanks to companies so far absorbing the extra costs or boosting inventory. However, if higher levies set in, shielding consumers from those costs will become more markets projected about two Fed reductions by the end of 2025 as traders boosted bets on a September cut to around 75%.'I don't see evidence in this early report of widespread price increases, but I do expect higher inflation this year as firms react to the tariffs,' said Ronald Temple, chief market strategist at Lazard Asset Management. 'Ultimately, companies will have to swallow some combination of price increases to pay for higher tariffs, cost cuts to offset increased import costs, and/or lower profit margins.
Time of India
27 minutes ago
- Time of India
US stock futures, dollar dip on tariff threat
Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads US equity-index futures dipped along with the dollar after President Donald Trump said he will set unilateral tariff rates within two weeks, dialing up trade tensions once again. Oil jumped on tensions in the Middle for the S&P 500 and the Nasdaq 100 fell 0.2% after Trump said he will send letters to countries setting tariff rates within the next two weeks. The dollar weakened against all of its Group-of-10 peers with the yen among the biggest gainers. Gold rose as much as 0.6% on demand for safe havens. Asian shares were mixed at the extended its biggest daily gain since October after the US ordered some staff to depart its Baghdad embassy and allowed military service members' families to leave the Middle East amid rising security risks. West Texas Intermediate rose as much as 1.7% to $69.29 after jumping 4.9% it's unclear if Trump will follow through with his pledge - the president has often set two-week deadlines for actions, only for them to come later or not at all. The comments come a day after Chinese and US officials struck a positive tone following their talks to dial down trade tensions. Amid US talking with countries including India and Japan to lower the levies, some investors see Trump's comments as an effort to ramp up urgency in talks.'Common sense would suggest this is another Trump strategy to increase urgency in trade negotiations,' said Rodrigo Catril, senior foreign exchange strategist at National Australia Bank Ltd. 'Trump wants trade deals and he wants them sooner rather than later.'Stocks have steadied in recent weeks and an index of global equities is hovering near a record after recovering from their lows in April when Trump announced the highest US levies in a century in an effort to rewrite global trade. The MSCI All Country World Index hit a record S&P 500 index fell 0.3% Wednesday and the Nasdaq 100 dropped 0.4% as big tech weighed on US benchmarks. Softer-than-expected US inflation supported the case for Federal Reserve rate cuts, spurring Treasuries higher. A solid $39 billion sale of 10-year debt also helped the bonds. The advance was led by shorter maturities, with two-year yields dropping below 4%.Earlier, Trump said a trade framework with China has been completed, with Beijing supplying rare earths and magnets up front and the US allowing Chinese students into its colleges and universities. The US and China will maintain tariffs at their current, lower levels following the two nations' agreement this week in London, Trump said US core inflation rose in May by less than forecast, suggesting companies are largely holding back on passing higher tariff costs through to string of below-forecast inflation readings adds to evidence that consumers have yet to feel the pinch of tariffs — perhaps because the most punitive levies have temporarily been on pause, or thanks to companies so far absorbing the extra costs or boosting inventory. However, if higher levies set in, shielding consumers from those costs will become more markets projected about two Fed reductions by the end of 2025 as traders boosted bets on a September cut to around 75%.'I don't see evidence in this early report of widespread price increases, but I do expect higher inflation this year as firms react to the tariffs,' said Ronald Temple, chief market strategist at Lazard Asset Management. 'Ultimately, companies will have to swallow some combination of price increases to pay for higher tariffs, cost cuts to offset increased import costs, and/or lower profit margins.
Time of India
an hour ago
- Time of India
U.S. orders evacuation of non-essential personnel from Middle East amid rising Iran tensions
Amid rising tensions between Iran and Israel, the United States is reducing its diplomatic and military presence in parts of the Middle East. Non-essential personnel are being evacuated from Iraq, Bahrain, and Kuwait. This decision follows stalled nuclear negotiations with Iran. Military officials cite the need to protect American service members and their families. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads The United States has begun withdrawing non-essential diplomats and military families from several locations across the Middle East , responding to escalating security concerns linked to mounting tensions between Iran and Israel. The move, announced on June 11, 2025, involves both voluntary and mandatory departures from U.S. embassies and military bases in Iraq, Bahrain, Kuwait, and the U.S. consulate in Erbil, Iraqi U.S. officials have not specified the exact triggers for this abrupt shift, defense representatives cited "growing tensions in the Middle East" and the need to prioritize the safety of service members and their families. The region has seen a spike in hostilities as the Trump administration's negotiations with Iran over its nuclear program have stalled, and Israeli officials have placed their military on high alert for a possible escalation with Donald Trump , recently expressed diminishing confidence in reaching a diplomatic agreement with Iran, warning that the alternative to a deal could be conflict. Iran's defense minister, Aziz Nasirzadeh, has threatened to target U.S. military bases in the region if diplomatic efforts collapse and military action is taken against Iran. Tehran maintains its nuclear ambitions are peaceful, but U.S. and Israeli officials remain wary of potential weapons development The U.S. State Department emphasized that the safety and security of American personnel is the top priority and that the decision to reduce staffing was made after a thorough security review. The U.K. and other allies have also warned about the risk of military escalation affecting regional shipping and energy supplies, with oil prices surging over 4% following the U.S. military presence in the region remains significant, with about 2,500 troops in Iraq and thousands more stationed in Bahrain, Kuwait, Qatar, Syria, and the UAE. Defense Secretary Pete Hegseth has authorized voluntary departures for dependents of military personnel across the Central Command area of operations, emphasizing that the safety of service members and their families is the U.S. measures, Iraqi officials have stated they have not observed specific threats necessitating the evacuation, suggesting the decision is part of broader U.S. procedures for diplomatic presence in the region.
