NWLs Earnings Show Bigger Losses, Deeper Trouble Than Revenue Alone

Newell Brands (NWL) reported Q4 2025 results that met adjusted EPS expectations but delivered a sharply wider net loss. The company’s guidance for 2026 remained cautious, projecting flat to slightly negative sales growth and a modest operating margin expansion.

Revenue

Newell’s total revenue declined 2.7% to $1.90 billion in Q4 2025, falling short of 2024’s $1.95 billion. Home and Commercial Solutions led with $1.13 billion in revenue, while Learning and Development contributed $629 million. Outdoor and Recreation generated $142 million, reflecting weaker performance in discretionary categories. The Corporate segment reported $0 revenue, consistent with prior periods.

Earnings/Net Income

Newell’s losses deepened significantly, with a net loss of $315 million ($0.75 per share) in Q4 2025, compared to a $54 million ($0.13 per share) loss in the prior-year period. The 483.3% increase in the net loss underscores the company’s struggles to offset tariff impacts and pricing pressures.

Price Action

Newell’s stock surged 15.75% in the latest trading day and 18.41% month-to-date, though post-earnings trading revealed a problematic investment strategy.

Post-Earnings Price Action Review

The strategy of buying NWL when its revenue beats expectations and holding for 30 days resulted in a significant loss. The strategy returned -87.70%, underperforming the benchmark by 163.35%. With a maximum drawdown of 91.04% and a Sharpe ratio of -0.73, the strategy indicated a high-risk profile, evidenced by a 48.45% volatility rate.

CEO Commentary

Christopher Peterson, CEO of Newell Brands, emphasized the company’s resilience amid tariff-driven challenges, citing strategic investments in innovation and supply chain diversification. He highlighted plans for 25 Tier 1/2 product launches in 2026 and expressed confidence in outperforming category declines through disciplined execution.

Guidance

Newell guided for 2026 core sales to decline 2%–0% amid expected category contraction, with net sales down 1%–up 1%. Normalized operating margin is targeted to expand to 8.6%–9.2%, supported by $75M+ productivity savings. EPS guidance: $0.54–$0.60, with Q1 EPS at -$0.12 to -$0.08. Operating cash flow is projected at $350M–$400M.

Additional News

Newell Brands announced price cuts of up to 15% on core products like Rubbermaid food storage and Graco baby gear to address consumer cost sensitivity. The company also cut 900 jobs and closed 20 Yankee Candle stores in 2025, incurring $90 million in restructuring charges. Additionally, Newell declared a $0.07 dividend in October 2025, reflecting its focus on shareholder returns amid operational challenges.

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Key Financials Summary:

• Revenue: $1.90B (-2.7% YoY)

• Net Loss: $315M (-483.3% YoY)

• 2026 Guidance: EPS $0.54–$0.60, core sales -2% to 0%

Strategic Focus:

• Tariff mitigation through domestic manufacturing

• Innovation pipeline with 25 product launches

• Cost discipline via $75M+ productivity initiatives

Risks:

• Q1 2026 earnings expected to contract due to tariff annualization

• High volatility in stock price post-earnings

• Persistent category declines in discretionary segments