Newell Brands NASDAQ: NWL reported a return to year-over-year sales growth in the second quarter of 2026, as product innovation, expanded retail distribution and increased advertising support helped lift demand across much of its portfolio.
Net sales rose 3% to approximately $2 billion, while core sales increased 2.3%, exceeding the company’s guidance range. President and CEO Chris Peterson said this marked Newell’s first year-over-year growth in both net sales and core sales in more than four years.
Five of the company’s six business units posted core sales growth, while seven of its 10 largest brands and five of its 10 largest countries recorded year-over-year sales growth. The U.S., Newell’s largest market, delivered roughly 5% net sales growth, its first domestic growth since the COVID period, according to Peterson.
Innovation and distribution support sales recovery
Peterson attributed the improvement to capabilities Newell has rebuilt in recent years, including consumer insights, brand and category management, innovation processes, retail execution and customer investment discipline. The company said it is on track to introduce more than 25 tier 1 or tier 2 innovation launches during 2026.
Total U.S. distribution points increased by a mid-single-digit percentage from a year earlier in the second quarter. Peterson said retailer commitments already in place should allow distribution to remain a growth contributor during the second half.
Point-of-sale trends also improved. Six of Newell’s top 10 brands reported year-over-year POS growth, while eight improved sequentially. The company said it gained U.S. market share in brands including Graco, Sharpie, Expo and Coleman.
- Learning & Development: Core sales increased nearly 5%, supported by double-digit Baby sales growth and a return to growth in Writing.
- Baby: Graco’s U.S. POS increased at a strong double-digit rate, and its market share rose 2.7 points year-to-date. Demand was aided by the EasyTurn rotating car-seat platform.
- Writing: Growth reflected distribution gains, product innovation and back-to-school execution. Peterson said Sharpie, Elmer’s and Prismacolor gained share during the early weeks of the back-to-school season.
- Outdoor & Recreation: Core sales grew nearly 4%, led by the U.S. and supported by Coleman innovation.
- Home and Commercial: Kitchen and Home Fragrance returned to core sales growth, while Commercial remained below the prior-year period but improved from the first quarter.
On Commercial, Peterson said Newell expects further sequential improvement beginning in the third quarter, citing a revamped Brute trash can, a Brute Farm product line and Spontex Flex & Wash innovation in Europe. He said the segment could return to growth in the near term.
Margins benefited from tariff recoveries
Chief Financial Officer Mark Erceg said normalized gross margin increased to 40.8% from 35.6% a year earlier, while normalized operating margin rose to 16.2% from 10.7%. The sharp increases were primarily driven by the recognition of a receivable for nearly $100 million in recoveries related to IEEPA tariffs that had been expensed during 2025.
Excluding that one-time benefit, Erceg said normalized gross margin and operating margin would each have increased slightly from the prior-year period. Newell also recorded $26 million in recoveries tied to IEEPA tariffs incurred in the first quarter of 2026 before those tariffs were nullified.
Normalized diluted earnings per share rose to $0.42 from $0.24 a year earlier. Excluding the $0.17-per-share benefit tied to 2025 tariff recoveries and approximately $0.04 per share associated with first-quarter 2026 recoveries recognized in the second quarter, Erceg said earnings still would have exceeded the company’s prior guidance range of $0.16 to $0.19 per share.
Advertising and promotion spending increased $9 million, reaching 5.7% of sales, as Newell supported its expanded innovation pipeline. Restructuring and other savings of roughly $30 million helped offset wage inflation and higher variable compensation expenses.
Inflation remains a significant headwind
Despite better-than-expected category conditions in the first half, management remained cautious about the second half. Newell now assumes its categories will decline about 1% for the full year, compared with its initial expectation for a 2% decline. Categories declined about 1% in the first quarter and were essentially flat in the second quarter, Peterson said.
The company expects a $127 million net profit-and-loss tariff headwind in 2026, excluding IEEPA refunds, compared with $115 million in 2025. It also increased its forecast for 2026 inflationary costs to about $200 million from approximately $100 million at the start of the year.
Newell has responded through productivity programs, overhead reductions and targeted pricing rather than broad-based price increases. Peterson said the company has raised prices on resin-heavy products representing less than 10% of its business, including certain commercial and Coleman cooler products, but does not currently expect broad pricing actions to be necessary to meet its outlook.
Company raises full-year outlook
Newell raised its 2026 outlook following the second-quarter results. The company now expects net sales growth of 1% to 2% and core sales ranging from flat to up 1%. It forecast normalized operating margin of 10% to 10.4% and normalized diluted EPS of $0.73 to $0.77, up from its prior EPS outlook of $0.56 to $0.60.
The increased EPS range reflects the $0.17-per-share recovery related to tariffs expensed in 2025, Erceg said. The company expects the in-year 2026 tariff recovery, together with productivity and cost-control efforts, to help offset inflation.
Newell also raised its operating cash flow outlook to approximately $400 million, assuming it receives substantially all of the IEEPA tariff recovery by year-end. Operating cash flow was an outflow of $204 million in the first half, improving from an outflow of $271 million in the prior-year period. The company expects to end 2026 with net leverage comfortably below 4.5 times.
For the third quarter, Newell expects net sales and core sales growth of 2% to 3%, normalized operating margin of 9.5% to 10.2%, and normalized diluted EPS of $0.18 to $0.20.
About Newell Brands (NASDAQ:NWL)
Newell Brands Inc, trading on NASDAQ under the ticker NWL, is a global consumer goods company known for its diverse portfolio of household, commercial, and specialty products. Formed through the merger of Newell Rubbermaid and Jarden Corporation in 2016, the company traces its roots back to Newell Manufacturing, which was founded in 1903. Headquartered in Atlanta, Georgia, Newell Brands has built a reputation for widely recognized brands spanning multiple consumer categories.
The company's business activities are organized across several segments, including writing and creative expression, home solutions, commercial products, and outdoor recreation.
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