Kenvue sales near $4 billion despite tariff and inflation pressures in Q2 2026

By Lollie Hancock | Published: 10-Aug-2026

Although tariffs, inflation and currency-related costs led Kenvue to fall short of its Q2 estimates, the company’s beauty division delivered strong growth for the consumer health group

Kenvue’s Skin Health & Beauty division has delivered a strong second quarter of trading in 2026, seeing both sales and volume increases.

The Johnson & Johnson (J&J) spinoff consumer health company, currently in the process of a $40bn buyout by consumer goods giant Kimberly-Clark, saw Q2 sales reach US$3.96bn – a 3% increase year-on-year but falling short of estimates of $3.97bn.

However, profitability was pressured by rising costs, with adjusted gross margin falling to 60.2% from 60.9% a year earlier, with adjusted operating margin declining from 22.7% to 22.1%.

Inflation, tariffs and currency pressures also continued to put pressure on the company’s margins, leading Kenvue to narrowly miss analysts’ estimates.

The company cited inflation, tariffs and unfavourable foreign exchange rates as offsetting productivity savings.

The results come despite improvement in Kenvue’s Skin Health & Beauty division, which houses brands including Neutrogena, Aveeno and OGX and generated $1.11bn in Q2 sales – a 5.1% rise year on year.

Organic sales also increased by 3.7%, making Skin Health & Beauty Kenvue’s fastest-growing division during the period.

Hair care and skin care were key drivers of the division’s growth, with Kenvue citing robust e-commerce momentum and innovation as contributors, specifically highlighting OGX’s Pro Growth & Peptide and Neutrogena’s Ultra Sheer Sun launches.

Neutrogena continued to gain in the US, with household penetration increasing for the third consecutive quarter due to increased brand investment and commercial activity.

Adjusted operating income for the division grew almost 25% from $149m to $186m.

While overarching margins were squeezed, reported net income for the company increased to $456m, up from $420m in the previous year.

The results mark a significant improvement in Kenvue's beauty business compared to last year.

The turnaround comes as Kenvue prepares for its planned acquisition by Kimberly-Clark.

The deal, valued at $40bn, is expected to close in Q4 2026.