Procter & Gamble to cut 7,000 jobs, exit brands as consumer uncertainty weighs

By Aishwarya Venugopal and Jessica DiNapoli

(Reuters) -Procter & Gamble will cut 7,000 jobs over the next two years, as the Tide detergent maker contends with an uncertain spending environment, fueled in part by U.S. tariffs that have roiled numerous consumer companies.

The world's largest consumer goods company also plans to exit some product categories and brands in certain markets, including some potential divestitures, as part of the broader two-year restructuring plan.

"This is not a new approach, rather an intentional acceleration of the current strategy ... to win in the increasingly challenging environment in which we compete," executives said at a Deutsche Bank Consumer Conference in Paris on Thursday.

The job cuts amount to about 6% of its workforce, which P&G characterized as part of its ongoing strategy.

Notably, CFO Andre Schulten and operations head Shailesh Jejurikar said at the conference that the geopolitical environment was "unpredictable" and that consumers were facing "greater uncertainty."

President Donald Trump's sweeping levies on trading partners have shaken global markets and sparked concerns of a recession in the United States.

P&G on Thursday estimated about a $600 million before-tax hit in its fiscal year 2026, based on current tariff rates. The rates have frequently changed over the past few months.

Overall, the trade war has cost companies at least $34 billion in lost sales and higher costs, a Reuters analysis showed.

In April, P&G said it would raise prices on some products, and Schulten said it was prepared to "pull every lever" in its arsenal to mitigate the impact of tariffs - primarily through higher prices and cost-cutting.

"The two-year window ... gives them some flexibility in terms of timing and depth of cuts, as the tariff situation is very fluid," said Christian Greiner, senior portfolio manager at F/m Investments that owns shares in P&G.

The restructuring will help simplify the organizational structure by "making roles broader" and "teams smaller," P&G said.

"Spring cleaning at scale, shedding low-growth, low-moat units frees up cash to turbo-charge Tide, Pampers and Old Spice—the core brands," said Michael Ashley Schulman, chief investment officer at Running Point Capital.

In the past few years, P&G has exited the Argentina market and restructured its operations in Nigeria. It also divested the Vidal Sassoon hair care brand in China and a few other local brands in Latin America and Europe.

The company imports raw ingredients, packaging materials and some finished products into the U.S. from China. About 90% of what it sells is produced domestically, P&G has said. 

The company had about 108,000 employees as of June 2024. The job cuts would account for roughly 15% of its non-manufacturing workforce.

P&G expects to record charges of $1 billion to $1.6 billion before-tax over the two-year period, with a quarter of the charges expected to be non-cash.

Shares of the company were down about 1% in early trading. The stock has been largely flat over the past 12 months.

(Reporting by Rishabh Jaiswal, Juveria Tabassum, Aishwarya Venugopal in Bengaluru and Jessica DiNapoli in New York; Editing by Janane Venkatraman, Rashmi Aich and Sriraj Kalluvila)