One of the world's largest pure-play consumer health companies, Kenvue makes everyday brands most people already know — Tylenol and Zyrtec for self-care, Neutrogena and Aveeno for skin, and Listerine and BAND-AID for everyday essentials — sold in more than 165 countries. It was spun off from Johnson & Johnson in 2023, and its name blends a Scottish word meaning "knowledge" with "view," chosen to suggest deep consumer insight. The name is pronounced "ken-view."
Skin Health & Beauty posted a second straight quarter of organic growth, while gross margin contracted on tariffs and input costs.
Skin Health & Beauty extended its recovery with a second consecutive quarter of . rose 3.0% to $3.96 billion and grew 8.6% to $456 million, but contracted 0.7 points to 58.2% as U.S. tariffs and input cost inflation outweighed supply chain savings. The pending Kimberly-Clark merger remains the dominant structural event, while a new restructuring initiative aims to offset cost pressures.
Key takeaways
Skin Health and Beauty led performance with 5.1% reported sales growth and 3.7% , driven by pricing actions and e-commerce strength, marking its second consecutive quarter of organic expansion after a multi-year decline.
contracted 70 to 58.2%, as net input cost inflation, U.S. tariffs, and unfavorable transactional foreign exchange outweighed supply chain optimization benefits.
was nearly flat at $699 million, up just 1.0% , as higher brand support spending and $16 million in costs related to the pending Kimberly-Clark transaction offset restructuring savings and lower separation-related costs.
Section summaries
Management's Discussion and Analysis
Kenvue Q2 FY2026 net sales rose 3.0% to $3.96B on organic growth of 1.6%, while net income grew 8.6% to $456M.
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Consolidated increased 3.0% to $3.96B, with of 1.6% driven by 0.9% favorable and 0.7% volume increases.
The fell to 23.7% from 28.6% a year ago, driven by a release and favorable impacts from the One Big Beautiful Bill Act.
rose 10.8% to $688 million, and increased 17.1% to $624 million, while the company repaid $750 million in Senior Notes and paid $796 million in dividends.
The company launched a new 2026 Restructuring Initiative targeting approximately $250 million in charges in fiscal 2026 and approximately $200 million in annualized pre-tax savings upon completion.
What changed
Skin Health & Beauty's 3.7% in Q2 follows the 5.0% organic growth in Q1 FY2026, confirming the 's return to growth after at least four consecutive quarters of decline through FY2025.
contracted 0.7 points to 58.2%, reversing the expansion seen in Q1 FY2026, as the estimated $130 million in annualized tariff exposure flagged in the FY2025 10-K began to weigh more heavily on results.
The new 2026 Restructuring Initiative, targeting $200 million in annualized savings, adds a second active restructuring program alongside the 'Our Vue Forward' initiative, which is approaching its FY2026 target of $350 million in annualized pre-tax savings.
The pending all-stock merger with Kimberly-Clark, for which shareholder approval was obtained in January 2026, continues to generate transaction costs that are now appearing in as a distinct line item.
What to watch
Skin Health & Beauty in Q3 FY2026, to see if the can sustain a third consecutive quarter of growth and confirm a durable recovery.
trajectory as tariff and input cost pressures persist, and whether the new restructuring initiative's savings can offset the margin contraction seen this quarter.
Any regulatory or closing updates on the pending all-stock merger with Kimberly-Clark, which remains the dominant structural event for the company.
The pace of charges versus savings under the new 2026 Restructuring Initiative, to assess whether the $200 million in targeted annualized savings will offset the $250 million in expected charges.
Skin Health and Beauty led performance with 5.1% reported sales growth and 3.7% , fueled by pricing actions and e-commerce strength.
margin contracted 70 to 58.2% as net input cost inflation, U.S. tariffs, and unfavorable transactional FX outweighed supply chain optimization benefits.
was nearly flat at $699M as higher brand support and $16M in Pending Transaction costs offset restructuring savings and lower Separation-related costs.
The fell to 23.7% from 28.6% due to a release and favorable impacts from the One Big Beautiful Bill Act.
rose 12.2% to $1.18B; the company repaid $750M in Senior Notes and paid $796M in dividends while funding a new $250M restructuring initiative.
Quantitative and Qualitative Disclosures About Market Risk
For quantitative and qualitative disclosures about market risk, see Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk,” included in our Annual Report. 50
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For quantitative and qualitative disclosures about market risk, see Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk,” included in our Annual Report.
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The information required by this item is incorporated herein by reference to Note 13, “Commitments and Contingencies,” to the Condensed Consolidated Financial Statements included herein.
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The information required by this item is incorporated herein by reference to Note 13, “Commitments and Contingencies,” to the Condensed Consolidated Financial Statements included herein.
In addition to the other information set forth in this Quarterly Report on Form 10-Q, the reader should carefully consider the factors in Part I, Item 1A, “Risk Factors,” included in our Annual Report.
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In addition to the other information set forth in this Quarterly Report on Form 10-Q, the reader should carefully consider the factors in Part I, Item 1A, “Risk Factors,” included in our Annual Report.