AI Takeaway
Kenvue (KVUE) delivered a strong Q1 2026 with revenue up 4.5% YoY to $3.91B, while operating income surged 37.5% and net income jumped 47.2% to $474M, driven by significant cost discipline and margin expansion.
Revenue
$3.91B
++4.49% YoY
EPS (Basic)
$0.25
++47.06% YoY
Gross Margin
58.9%
++0.94% YoY
Operating Income
$767M
++37.46% YoY
Filed · Source: SEC EDGAR 10-Q filing
Kenvue grew total revenue by 4.5% YoY to $3.91B in Q1 2026 (vs. $3.74B in Q1 2025), reflecting continued consumer demand for its self-care and consumer health brands despite a challenging macro environment.
Source: Source: 10-Q Income Statement
Gross margin improved approximately 94 basis points YoY to 58.9%, while operating margin expanded dramatically by ~470 basis points to 19.6%, indicating strong operating leverage and cost efficiency improvements.
Source: Source: 10-Q Income Statement, Key Ratios
SG&A expenses declined 5.5% YoY to $1.45B and R&D expenses fell 15.2% YoY to $84M, together contributing meaningfully to the operating income surge of 37.5% to $767M.
Source: Source: 10-Q Income Statement
2 more insights available
Upgrade to unlockKenvue's current ratio stands at 0.983, meaning current liabilities of $5.90B slightly exceed current assets of $5.80B. While current liabilities declined 11.6% YoY, this sub-1.0 ratio warrants monitoring as it indicates the company technically cannot cover all short-term obligations with liquid assets alone.
Source: Source: 10-Q Balance Sheet, Key Ratios
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $0.32 versus the $0.27 analyst consensus — a +19.6% beat for Q1 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $3.91B | $3.74B | +4.49% |
Cost of Revenue | $1.61B | $1.57B | +2.16% |
Gross Profit | $2.3B | $2.17B | +6.18% |
Operating Income | $767M | $558M | +37.46% |
Net Income | $474M | $322M | +47.20% |
EPS (Basic) | $0.25 | $0.17 | +47.06% |
EPS (Diluted) | $0.25 | $0.17 | +47.06% |
R&D Expense | $84M | $99M | -15.15% |
SG&A Expense | $1.45B | $1.54B | -5.47% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $26.85B | $26.26B | +2.27% |
Current Assets | $5.79B | $5.71B | +1.49% |
Total Liabilities | $16.25B | $16.2B | +0.26% |
Current Liabilities | $5.9B | $6.67B | -11.55% |
Stockholders' Equity | $10.61B | $10.05B | +5.52% |
Cash & Equivalents | $1.07B | $1.06B | +1.70% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $489M | $428M | +14.25% |
Investing Cash Flow | $-167M | $-167M | 0.00% |
Financing Cash Flow | $-295M | $-310M | +4.84% |
Dividends Paid | $398M | $392M | +1.53% |
Share Buybacks | $0 | $63M | -100.00% |
D&A | $143M | $136M | +5.15% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Gross Margin | 58.9% | 58.0% | +0.94% |
Operating Margin | 19.6% | 14.9% | +4.71% |
Net Margin | 12.1% | — | — |
ROE | 4.5% | — | — |
ROA | 1.8% | — | — |
Current Ratio | $0.983 | — | — |
Debt to Equity | $1.531 | — | — |
Other companies in Personal Care Products
Kenvue (KVUE) had a strong Q1 2026, with revenue rising 4.5% YoY to $3.91B and net income jumping 47.2% to $474M. EPS came in at $0.25, up from $0.17 in Q1 2025, driven by significant cost reductions in SG&A (-5.5%) and R&D (-15.2%).
The biggest takeaway from KVUE's Q1 2026 report is the dramatic margin expansion: operating margin improved nearly 5 percentage points to 19.6%, and net income grew nearly 50% despite only modest revenue growth of 4.5%. Cost discipline — particularly in SG&A and R&D — was the primary driver of this earnings outperformance.
Yes, Kenvue grew revenue 4.5% YoY to $3.91B in Q1 2026, up from $3.74B in Q1 2025. Gross profit grew even faster at 6.2% to $2.30B, as cost of revenue increased only 2.2%, reflecting improved pricing or product mix.
Kenvue paid $398M in dividends in Q1 2026, while generating $489M in operating cash flow and spending $167M on investing activities, resulting in free cash flow of approximately $322M — slightly below the dividend amount. While the dividend is currently being maintained, investors should note it is partially funded by financing activities, which warrants ongoing monitoring.
The key financial risks for Kenvue include a debt-to-equity ratio of 1.53 indicating significant leverage, a current ratio just below 1.0 (0.983) suggesting modest near-term liquidity pressure, and a 15.2% decline in R&D spending that could impact long-term product innovation. These factors, combined with dividends exceeding free cash flow in Q1, are the primary concerns highlighted by the Q1 2026 financial data.