Newell Brands Inc.

What they do

Newell Brands designs, manufactures, sources, and markets a wide range of consumer and commercial products, including kitchen appliances, food storage, writing instruments, baby gear, and outdoor equipment. Its three operating segments are Home and Commercial Solutions, Learning and Development, and Outdoor and Recreation, selling products under brands such as Rubbermaid, Sharpie, Graco, Coleman, and Yankee Candle. The company operates in over 150 countries, with direct operations in more than 45.

Revenue drivers

• Home and Commercial Solutions — Largest segment, generating revenue from household products (kitchen appliances, food storage, cookware) and commercial cleaning/maintenance solutions under brands like Rubbermaid, Calphalon, and Yankee Candle.
• Learning and Development — Revenue from writing instruments, art products, baby gear, and labeling solutions under brands like Sharpie, Paper Mate, Elmer's, and Graco, sold through mass merchants, office supply stores, and e-commerce.
• Outdoor and Recreation — Revenue from active lifestyle products, technical apparel, and beverageware under brands like Coleman, Contigo, and Marmot, sold through sporting goods and specialty retailers.

Recent performance

In Q2 2026, net sales were $2.0 billion, up 3.0% year-over-year, with core sales growth of 2.3%. Net income was $106 million versus $46 million in the prior year period, and diluted EPS was $0.25 versus $0.11. Gross margin improved to 40.7% from 35.4%, and operating margin rose to 14.2% from 8.8%. Results included approximately $100 million pretax tariff recovery related to IEEPA tariffs. The company returned to sales growth for the first time in over four years.

Strategy

Management is executing a multi-year transformation focused on top-line improvement through innovation, brand building, and distribution expansion. The company aims to expand margins via productivity, procurement savings, and overhead management while navigating tariffs and inflation. Further deleveraging and cash flow improvement are priorities, along with complexity reduction, ERP consolidation, and SKU optimization. A new $800 million asset-based revolving credit facility was entered into subsequent to quarter end, extending maturity to 2031.

Risks

• Intense competition — Competes with large omni-channel and e-commerce retailers that have strong negotiating power, can reduce inventory, and demand price concessions.
• Tariff exposure — New tariffs imposed in 2025 and retaliatory actions increase costs; despite recoveries, ongoing tariff impacts could pressure margins.
• Macroeconomic volatility — Inflationary pressures, shifting consumer preferences, and geopolitical volatility could affect demand and profitability.
• Retailer consolidation and private label — Large retailers may import directly or source private-label brands at lower prices, intensifying competition and pressuring sales.

Outlook

Management raised full-year 2026 outlook for net and core sales growth, normalized operating margin, normalized EPS, and operating cash flow, based on Q2 beat and improving top-line trends. They expect a cash refund from IEEPA tariff recoveries in the second half of the year. The company expects benefits of capability improvements to phase in over time, with continued focus on profitable growth.