By Sneha S K
(Reuters) -Kenvue cut its annual sales forecast on Thursday, as the consumer health company undergoes a strategic review aiming to boost brand performance amid a cautious spending environment.
The company, spun off from Johnson & Johnson in 2023, has been working to shore up profitability, especially in its struggling skin health and beauty unit that houses brands such as Neutrogena and Aveeno.
Wall Street analysts view the Band-Aid maker as an acquisition target after it came under pressure from investors, who have criticized the lackluster performance in those segments.
Kenvue ousted its CEO Thibaut Mongon in July, which some investors expect would be the groundwork for an eventual sale of the entire company or pieces of it. The company, which named Kirk Perry as its interim chief, said on Thursday its previously announced strategic review continues to advance and the board is considering a broad range of potential alternatives.
It had also appointed former Kellanova executive Amit Banati as its finance chief in May.
Kenvue's executives on a post-earnings call emphasized on leveraging their prior experience in consumer companies to improve its performance to deliver reliable and consistent results.
“I clearly see the opportunity where I can step in and make a difference right away, drawing on my past experiences,” Perry said.
The Tylenol maker expects its 2025 net sales to be down low-single-digits, compared with its prior expectation of a 1% to 3% increase. It said the cautious sentiment of consumers has been factored into the forecast.
“Kenvue is clearly a ‘show me' story and must demonstrate sequential improvement/consistent delivery in order for shares to rate higher,” said RBC Capital Markets analyst Nik Modi.
The company forecast annual adjusted profit to be in the range of $1.00 to $1.05 per share, below analysts' estimate of $1.13 per share, according to data compiled by LSEG.
It posted adjusted profit per share of 29 cents during the second quarter, compared with the estimate of 28 cents.
(Reporting by Sneha S K in Bengaluru; Editing by Shilpi Majumdar)
