How did KVUE's actual earnings deviate from forecasts in 2024?

Kenvue's actual earnings deviated from forecasts in several key areas in 2024:

1. Revenue and Net Income:
   • Kenvue's net sales for Q3 2024 were $3.9 billion, which was slightly below the analyst estimate of $3,931.57 million.
   • The company's diluted EPS for Q3 2024 was $0.20, missing the analyst estimate of $0.25.
   • In Q1 2024, Kenvue's revenue was $3.9 billion, slightly surpassing the estimated $3.789 billion.
   • The net income reported for Q1 2024 was $296 million, falling short of the estimated $488.67 million.
2. Organic Growth and Profit Margins:
   • Despite the slight revenue shortfall, Kenvue achieved organic growth of 0.9%.
   • Gross Profit Margin expanded by 100 basis points to 58.5%, reflecting productivity gains and value realization efforts.
   • However, Operating Income Margin declined to 16.8% from 18.1% in the prior year, impacted by increased brand investment.
3. Strategic and Tax Impacts:
   • Increased brand investment and a higher effective tax rate of 33.6% contributed to the lower EPS.
   • An increased tax rate and a $68 million impairment charge affected the operating income margin, which decreased to 14.1%.
4. Full-Year Outlook and Variations:
   • Kenvue reaffirmed a full-year adjusted EPS range of $1.10 to $1.20, expecting net sales growth between 1.0% to 3.0%.
   • The company's FY 2024 earnings guidance provided an EPS guidance of $1.100 to $1.200, slightly below the consensus estimate of $1.140.

In summary, while Kenvue experienced slight deviations from forecasts in both quarters, the company's strategic investments and market conditions significantly impacted its financial performance, particularly in terms of net income and EPS.