Church & Dwight Charts Course for Growth After Portfolio Overhaul, Eyes Acquisitions

EWING, N.J. – Church & Dwight (NYSE: CHD) concluded its 2025 fiscal year with a confident stride, framing the coming year as one with "more tailwinds than headwinds." During its fourth-quarter earnings call, executives detailed a year of significant portfolio reshaping aimed at reducing exposure to private-label competition and positioning the 178-year-old consumer goods giant for sustained, volume-driven growth.

While acknowledging a backdrop of slowed category growth and fragile consumer sentiment, management reported outperforming their markets across all three divisions. Standout performers included the Hero acne brand and TheraBreath oral care, both notching double-digit growth. CFO Lee McChesney reported full-year sales of $6.2 billion, with strong operational cash flow of $1.2 billion funding a $900 million return to shareholders and providing "tons of optionality" for future deals.

The company's strategic pivot was a central theme. By exiting roughly $400 million in sales, primarily from the volatile vitamins, minerals, and supplements (VMS) business, Church & Dwight slashed its weighted-average private-label exposure from about 12% to 5%. "Vitamins had been an extremely large private label business," an executive noted, signaling a move toward more defensible, brand-driven segments. This restructuring, coupled with aggressive tariff mitigation efforts that reduced a $190 million exposure to $25 million, forms the foundation of its 2026 outlook.

For the new year, the company issued guidance based on its "Evergreen Model," anticipating 2-4% organic sales growth and a notable 100-basis-point improvement in gross margin—well above the model's typical range—attributed to the portfolio changes. Management emphasized that growth is planned to be volume-led, not price-driven, a notable stance in an inflationary environment. The company also announced a 4.2% dividend increase, marking its 30th consecutive year of raising payouts.

CEO Rick Tucker outlined three strategic priorities: winning in the U.S. with seven core "power brands," building international scale, and accelerating digital and e-commerce capabilities. In the U.S., Arm & Hammer detergent achieved a record 14.5% market share, while TheraBreath solidified its position as the #2 mouthwash, with ambitions to climb to the top spot. The recently acquired Touchland brand, a premium hand sanitizer and personal care line, was highlighted as a key growth driver and a test case for premium channel strategy.

"Our portfolio is now stronger and more focused," Tucker stated in closing remarks. "The reshaping actions, our innovation pipeline, and our balance sheet give us confidence in our ability to execute and create value in 2026 and beyond."

Market Voices: Analyst & Investor Reactions

David Chen, Portfolio Manager at Sterling Growth Fund: "The portfolio surgery is a late but welcome move. Exiting low-margin, commoditized businesses and doubling down on brands with real pricing power and loyalty, like TheraBreath, is the right playbook for this market. Their clean balance sheet is a weapon for tuck-in acquisitions."

Maya Rodriguez, Consumer Staples Analyst at ClearView Research: "The guidance is ambitious, especially the margin expansion target. It shows the tangible benefits of the restructuring. The key question is whether the 2% assumed category growth is realistic. Their success hinges on taking share, which their power brands seem capable of doing."

Frank Kellerman, Independent Investor and frequent commentator on investor forums: "Another quarter of sub-1% organic growth when you adjust for the 'exited business' is nothing to crow about. They're spinning weakness as strategy. Touchland is a trendy, overpriced niche brand—hardly the growth engine they need. This feels like rearranging deck chairs while consumer spending sinks."

Priya Mehta, Retail Strategist: "Their digital metrics are impressive—e-commerce going from 2% to 24% of sales. Leveraging AI for content and using TikTok Shop shows they're not just a legacy brick-and-mortar player. The challenge is making Hero and Batiste resonate online as well as they do in stores."

Church & Dwight, founded in 1846, is a leading consumer products company known for the Arm & Hammer brand. Its portfolio includes household, personal care, and specialty products.