Procter & Gamble announced a two-year restructuring plan that will eliminate approximately 7,000 positions, or about 6% of its global workforce, in response to mounting uncertainty stemming from President Donald Trump’s tariffs. The initiative will also see the consumer goods giant exit select product categories in certain markets as it seeks to fortify profitability amid rising costs and muted demand forecasts for 2025.
Speaking at the Deutsche Bank Consumer Conference in Paris, P&G executives described the overhaul as an “intentional acceleration” of existing strategic priorities. Chief Financial Officer André Schulten and President of Global Operations Shailesh Jejurikar emphasized that the restructuring is designed to streamline the organization, sharpen focus on core brands such as Tide and Pampers, and enhance agility when confronting an unpredictable geopolitical landscape.
The company estimated that the new tariffs would inflict a before-tax hit of roughly $600 million during its 2026 fiscal year. Roughly 90% of its U.S. sales are manufactured domestically, yet P&G still imports raw materials, packaging components, and a small share of finished products from China. Those imports are now subject to 25% duties on certain goods, translating into higher input costs that are filtering through to P&G’s profit margins.
“Consumers are confronting greater uncertainty, and we are prepared to pull every lever in our arsenal to mitigate the impact of sustained tariff pressures,” Schulten explained. In April, the company announced targeted price increases on select brands and signaled readiness to employ aggressive cost-management tactics. Previously, P&G had absorbed incremental costs by optimizing manufacturing processes and consolidating supply chains, but rising duties have begun to erode those efficiencies.
Jejurikar noted that the broader trade war has already cost multinational corporations more than $34 billion in lost sales and elevated expenses. Against this backdrop, P&G decided to expedite initiatives that would otherwise have taken longer to implement. “This is not a reactive move, but rather a proactive intensification of measures that were already under way,” he said, highlighting plans to divest underperforming product lines and reallocate resources toward high-growth segments.
As part of the restructuring, P&G will reduce its non-manufacturing headcount by roughly 15%, affecting roles across finance, marketing, and administrative functions. Factory jobs and roles tied directly to production are expected to remain largely intact. The Chicago-based company employed around 108,000 people worldwide as of June 30, 2024.
Investors have welcomed the new cost-cutting measures, buoying P&G shares on the Nasdaq following the announcement. Analysts point out that an emphasis on leaner operations could help maintain dividend payouts and stabilize earnings per share in the face of lingering tariff-related headwinds.
Industry experts say that P&G’s move underscores the broader challenges confronting consumer goods companies, which must balance pricing power against eroding household budgets. While some rivals have shifted production to lower-cost regions, P&G has largely maintained its U.S.-centric manufacturing footprint. The plan to exit certain product categories is intended to concentrate investment in marquee brands that promise higher returns.
President Donald Trump’s steel and aluminum tariffs—imposed earlier this year—have reverberated well beyond the metals sector. Many companies now face higher costs for raw materials, packaging, and equipment, intensifying pricing pressures across consumer staples. Retailers, in turn, have been cautious about passing full costs onto shoppers, fearing a drop in discretionary spending.
P&G’s leadership reiterated that flexibility remains paramount. In the event of new tariff announcements or further escalation of existing levies, the company will revisit its cost structures and pricing strategies. “The geopolitical environment is increasingly challenging, and we must remain nimble,” Jejurikar stated.
In addition to workforce reductions, P&G plans to consolidate selected facilities, streamline supply-chain routes, and accelerate digital investments to drive productivity gains. Management believes that these steps will not only offset near-term tariff impacts but also position the company for sustainable growth once trade tensions ease.
Consumer advocacy groups, however, expressed concern that P&G’s price increases could exacerbate inflationary pressures on household goods. The company responded by pledging to safeguard lower-income consumers through targeted promotions and by minimizing price hikes on essential products where possible.
