Kenvue (NYSE:KVUE) shares surged more than 22% in premarket trading Monday after the U.S. consumer health company reported better-than-expected third-quarter results and revealed plans to be acquired by Kimberly-Clark (NASDAQ:KMB) in a $48.7 billion cash-and-stock deal.
For the third quarter, Kenvue earned $0.28 per share, topping analyst estimates of $0.26, while revenue came in at $3.76 billion, slightly below the consensus forecast of $3.83 billion.
Net sales declined 3.5% year-over-year, reflecting a 4.4% drop in organic sales, partially offset by a 1% benefit from foreign exchange, the company said.
Adjusted gross profit margin improved to 61.2% from 60.7% a year earlier, though the adjusted operating margin slipped to 21.5% from 22.1%.
“Throughout the third quarter, our team remained focused on our four operating priorities to drive improved performance,” said Kirk Perry, Kenvue’s Chief Executive Officer. “Third quarter results keep us on track to deliver our full-year guidance and we are confident in the decisive actions we are taking to accelerate Kenvue’s performance and unlock the inherent value of our brands.”
Kenvue reaffirmed its full-year 2025 guidance, maintaining its projection for earnings per share between $1.00 and $1.05, consistent with market expectations of $1.03. The company still anticipates net and organic sales to decline modestly, assuming minimal currency effects, and expects adjusted operating margins to trend slightly lower year-over-year.
In a separate announcement, Kenvue said it has signed a definitive merger agreement under which Kimberly-Clark will acquire all outstanding shares of Kenvue common stock in a transaction valuing the company at $48.7 billion.
The acquisition marks one of the largest consumer health deals in recent years and is expected to enhance Kimberly-Clark’s portfolio with Kenvue’s leading over-the-counter and personal care brands.