Kenvue at 2025 dbAccess Conference: Strategic Growth and Challenges

On Tuesday, 03 June 2025, Kenvue Inc. (NYSE:KVUE) presented at the 2025 dbAccess Global Consumer Conference, outlining its strategic path since its IPO. The company highlighted its achievements, such as the completion of its separation from Johnson & Johnson, while addressing challenges like macroeconomic pressures and regional market dynamics. Despite these hurdles, Kenvue remains optimistic about its growth prospects, driven by strategic investments and operational efficiencies.

Key Takeaways

• Kenvue successfully completed its separation from Johnson & Johnson, exiting over 2,300 Transitional Service Agreements (TSAs).
• Brand investments increased by 20% last year, focusing on profitable growth.
• The "View Forward" program aims to deliver $350 million in gross synergies by 2026.
• Kenvue is consolidating its US operations into a single location in Summit, New Jersey.
• The company anticipates a stronger performance in the second half of the year, driven by new innovations and marketing campaigns.

Financial Results

• Gross Margin Expansion: Kenvue expanded its gross margin by 200 basis points last year.
• Synergies: The "View Forward" program is on track to achieve $350 million in gross synergies by 2026.
• Brand Investment: Investments in brand development increased by 20% last year.
• Tariff Impact: The company estimates a $150 million gross impact from tariffs for 2025.

Operational Updates

• Separation from J&J: Kenvue completed the exit from over 2,300 TSAs, finalizing its separation from Johnson & Johnson.
• US Site Consolidation: The company has consolidated its seven US sites into one location in Summit, New Jersey.
• Pricing Investments: Kenvue is adjusting its pricing strategy in the US to achieve optimal price points of $4.99, $9.99, and $14.99.
• China Destocking: The company is experiencing destocking in China, attributed to low winter consumption and distributor channel reorganization.
• Innovation Pipeline: Seventy percent of innovation launches are planned for the second half of the year.

Future Outlook

• Back-Half Acceleration: Kenvue expects a back-half-weighted performance due to the absence of first-half negatives and the introduction of new innovations and marketing efforts.
• Commercial Plans: The company plans to drive growth through strong commercial strategies and the execution of its five extraordinary powers.
• Macroeconomic Factors: Kenvue is closely monitoring macroeconomic pressures and seasonal factors to assess their impact on demand.
• Tariff Mitigation: The company is adjusting its supply chain and engaging with retail partners to minimize the impact of tariffs.
• Long-Term Vision: Kenvue aims to become the undisputed leader in consumer health, leveraging its five extraordinary powers for significant shareholder value creation.

Q&A Highlights

• Separation Complexity: The complexity and scale of the separation from J&J were underappreciated externally.
• Investment Priorities: Kenvue prioritizes investing in the business, returning cash to shareholders, and deleveraging.
• M&A Stance: M&A activities are on hold, to be considered with discipline when more financial flexibility is available.
• Skin Health and Beauty: Positive results are seen in Skin Health and Beauty, particularly with Neutrogena regaining market share in the US.
• Consumer Behavior: Consumers are seeking value, shifting to smaller pack sizes and different channels.

For a more detailed understanding of Kenvue’s strategic direction and performance, refer to the full transcript below.

Full transcript - 2025 dbAccess Global Consumer Conference:

Steve, Unclear: Okay. Welcome back, everybody. Thank you. I am pleased to welcome back Kenview to the conference. Kenview, as you know, probably know, is a leading consumer health care company with roughly $16,000,000,000 in net sales across a wide array of categories, such as pain relief, allergy relief, skincare and oral care with leading brands like Aveeno and Band Aid, Johnson’s, Listerine, Neutrogena and Tylenol.

Roughly half the company’s revenue comes from outside The United States, derived from operations in over 165 countries globally. With us today are Chief Executive Officer, Thibault Mongon newly appointed Chief Financial Officer, Amit Banati and group president of EMEA and Latin America, Carlton Lawson. Thank you guys for joining us.

Thibault Mongon, Chief Executive Officer, Kenvue: Thank you for having us.

Steve, Unclear: Okay. So we’re gonna use the entirety of our time for q and a, and I would like to start. Ken, you guys have been working. I’m gonna start by reading the required language. So Kenview would like to remind you that today’s discussion will include forward looking statements.

These statements represent Kenview’s current beliefs and about future events. Please refer to Kenview’s annual report on Form 10 ks for the fiscal year ending 12/29/2024, and subsequent filings with the SEC for a discussion of factors that could cause the company’s actual results to differ materially from these projections. Additionally, today’s discussion will include certain non GAAP financial information, and the company has posted on its Investor Relations website and investors.kenvi.com a reconciliation of these measures to the nearest GAAP measure. So with that, I will open up for for questions. And I’ll start with you, Tivo.

Tivo, it’s been now two full years since Kenvue’s IPO and the separation from J and J. I guess as you reflect back, maybe just articulate for us some of what you feel are the biggest accomplishments of the company and the lessons learned. And what has you most excite excited as you think about the path forward for Kenview?

Thibault Mongon, Chief Executive Officer, Kenvue: Yeah. He has been two two years of of artwork to to do basically two things. One is to separate from from our previous parent company. That has been a huge undertaking to disentangle one hundred and thirty plus years of common history, exiting two thousand three hundred plus TSAs. We just completed this phase last month.

So it’s very recent. That has taken a lot of energy. And then at the same time, it’s really about solidifying our conditions to transform from, you know, a division of a large company to a a stand alone company focused on on on profitable growth. So that’s the other piece that where we have been focused on, and it’s really about creating a new operating model to reach more consumers and position the company to grow in the future. It’s also about shifting resources from fixed infrastructure costs to viable brand investments to fuel this brand growth.

And here, we have made a lot of progress. We have made some good progress on efficiencies and productivity with an expansion in our gross margin, 200 basis points last year. We have launched our view forward, a program that is going after synergies. We are on track to deliver three fifty million dollars of gross synergies by 2026. The program is really well on track.

And we have started investing more into our brands, 20% more last year. So you see this shift happening. And to drive all of that, we are also we have also worked a lot on our organization, our talent, our culture to really create the culture and the talent base we need to be successful as as CanView. So as we speak, excluding the manufacturing teams, about a third of, our employees are new to CanView. So that give you a sense of the magnitude of, of of the shift.

And every day, we are building a new culture. Actually, last month, we reached another milestone for the first time ever consolidating our seven US sites into one location in Summit, New Jersey, which is also the right step in in a good step in the right direction of moving into a culture of collaboration, speed, faster decision making, everybody under under one roof. So that’s really what we are we are focused on. You’re asking about learnings, many learnings as you as you can imagine. If you think about the separation, clearly, this took a lot of of energy and work probably more than we anticipated initially.

But the team have really proven their ability to execute because there was zero impact on the business. The other thing we just I just talked about culture. Culture change doesn’t happen overnight. So that’s something that you build over time. One team at a team, one location at a team, and that’s still still work in progress.

The other piece is, you know, we talked earlier this year about our new operating model and how we bring it to life with what we call our five extraordinary powers, the the superior science, relevant innovation, breakthrough marketing, expert recommendation, and seamless commerce. That takes time to evolve your capabilities in across all five powers and for these five powers to start working synergistically and deliver results. So that’s that’s learning, but it’s also what gets me excited because we have a lot of upside ahead of us, and we have many opportunities, especially on these five powers to to really raise our game and and deliver high higher level of performance.

Steve, Unclear: That’s great. Thank you for that. Amit, clearly, you have just recently arrived at CanView. But as you as as you assess the Kenview opportunity prior to joining, what had you most excited? And then, I guess, now that you’ve been in the building for about three weeks, has anything come to the foreground of your thinking either as a surprise or or or as a reinforcement?

Amit Banati, Chief Financial Officer, Kenvue: Also, is this is week three, but I’m really, really excited to be joining Kenview to be joining Kenview at this stage of its journey. And I’m excited because of the value creation opportunity that I see as we try and unlock and go to the next stage of accelerating profitable growth. Obviously, we’ve got a leading position in consumer health categories, categories that are growing, categories that have a tailwind. We’ve got iconic brands, we’ve got a global footprint, all of which I think are really strong fundamentals for long term sustainable profitable growth. I think from a timing standpoint as well, Thibault mentioned, there was a heavy lift in terms of separating from J and J in the past two years.

But a lot of the heavy lift is now behind us. And I think the organization is squarely focused on really accelerating and driving performance going forward. I’ve spent more than thirty years in consumer goods working in different markets, different countries, operating roles as well as financial roles. And I think my experience is going to be additive to the team. So really looking forward to working with Thibault, with Carlton, the leadership team and all Ken viewers as we kind of look to drive performance.

Great.

Steve, Unclear: So let’s let’s pivot to the business. And we’ve we’ve had a very eventful start to ’25. Lots of crosscurrents both on the consumer and on many of your retail partners in many of your markets. As you look at developments year to date, how have recent demand dynamics both impacted your categories? And we can talk a little bit about some of the destocking that’s happened in China perhaps.

And where you think we are today? Are conditions stable? Are they improving? Are they sliding?

Thibault Mongon, Chief Executive Officer, Kenvue: Yes. So if I think about what’s impacting our company today, we have strong commercial plans. We can talk about it and the teams continue to execute those very well. The business is impacted in first half. So it happened in the first quarter, and we’d expect a similar impact in the second quarter by two distinct things that we have at CanvaView.

One is the investment we have decided to make in The U. S. In terms of pricing. Our price points were not exactly where we wanted them to be for some codes. So you want to get the $4.99 9 point 9 9 dollars 14 point 9 9 dollars price point to really hit right threshold for consumers and drive volumes.

So that creates a short term headwind on the business, but we see consumptions volume going up. And so we believe that as we move forward, it will be a positive. We are also impacted by some destocking in China, related to some degree to the low level of consumption we saw in the winter, but also in the reorganization of our distributor channel. That continues to be on track, and we will have that behind us by the end of this quarter. So that doesn’t change.

Then the other thing that, as you mentioned and as we have been very clear about in our Q1 earnings call is what’s happening around us, right, to our categories. So here, you have two factors. You have macro as everybody else. And for our business, you have seasonality, level of incidents for those businesses of ours that are driven by levels of incidents. At the moment, summertime, it’s allergy and sun for us.

So if I unpack these two factors for us, what we see around the world, on the macro side, we definitely see the consumer continues to be under pressure regardless of the of the geography for slightly different reasons. But I would say consumers are under pressure. Consumers are worried with when you look at belief in the future, and we see it in how people behave in store. Right? The beauty of our consumer health categories is that they don’t leave our categories, Right?

You don’t leave the consumer health category very easily, but they spend less in certain categories and and geographies, and we need to to to adjust to that. And we see q two not materially different from from from q one. As you mentioned, what we also need to monitor is the impact of this macro environment on retail retailer behavior. And and here’s something we are seeing different for Canvio in q two to what we saw in q one is US retailers destocking, being much more thoughtful. Clearly, the tariff environment, created a lot of uncertainty for them, and we have seen them taking, immediate actions.

And so when I look at shipments, they are definitely trailing consumption in this quarter. We didn’t see it in the first quarter. Contrary to some others, we might have seen it earlier in the year. For us, we see it. How long is going to continue?

We’ll we’ll see. But that’s a new phenomenon that that that we see for us. So that’s more on the macro side, not very dissimilar from what you all see and I’m sure what many companies are going to talk about with this nuance in terms of timing of retailer destocking. On the season point of view, that’s something that we monitor very carefully. As you can imagine, we saw a longer winter.

So winter pushed spring into later in Q2. So we see that on allergy, where we saw later starts to the season. And so far, it’s below last year. So on seasonal businesses, the categories are behind last year and behind our own expectations. So you see a level of incidence in allergy in The U.

S. Down mid single digits category, down low single digit. So it’s not a great year so far for allergy. And sun, we see more or less the same. Let’s start to the season year to date behind last year.

But the season has not really started for recreational sun. Memorial Day weekend was just a few days ago. It was not great. Yes. As you and I could could see.

But again, we are just at the beginning of the season. So it’s too early to read the season. It will certainly impact Q2. Now as we talked about in our Q1, whether it’s a shift from Q2 to Q3, which happens, or if it’s a net negative because of overall season will be below last year, we’ll see. So focused on executing our commercial plan, innovation, investment behind our brands, impacted by the macro environment as everybody else and watchful on the season and the the impact it can have on what quarter or the full year.

So too early to tell, but we’ll continue to be watchful.

Steve, Unclear: Just following up on the destocking point you referenced, is that widespread? Or is it limited? Or is it targeted at any specific kind of segment or category?

Thibault Mongon, Chief Executive Officer, Kenvue: We see it more pronounced in The US, where we clearly have seen retailers responding differently, right, depending on where they are to the tariff situation.

Steve, Unclear: But across the portfolio in The US? Across the portfolio. Okay. Perfect. Carlton, maybe you can weigh in here and build on what Thibaut mentioned, but from a through the lens of EMEA and Latin America.

You mentioned pressured consumers. Maybe you can pick up from there and talk about how Steve. Landscape.

Carlton Lawson, Group President of EMEA and Latin America, Kenvue: Yeah. So the same geopolitical and economic environment is impacting consumers in EMEA and LatAm. I think we’re seeing consumer confidence wane and consumers are looking for value. As Tivo says, they’re not exiting the categories, but the frequency of purchase, smaller pack sizes, maybe different channels in terms of discounters or club in LatAm seeing an increase. But I think we’re well positioned in the portfolio with our brands, iconic brands as Amit says, and ensuring that we’re hitting specific price points.

We’ve just launched some access price points in Latin America on Johnson’s Baby, for instance, the refills, but actually they’re not necessarily used just for refilling their uses, category entry points and seeing significant share gains. What we’re seeing in terms of category is in EMEA as inflation came off last year and continues to be muted. The price impact is much lower in the categories. And we’ve gone from probably mid single digit to low single digit in EMEA. And in LatAm, think you’re seeing more of the geopolitical impact in Mexico, particularly and in Brazil.

And so that’s impacting consumer confidence. Inflation has come down, which is a positive situation, but then you’ve got some exchange rate devaluation challenges. What I would say and then for LatAm, this time last year, it was high teens in terms of category growth. We’re now looking at mid single digit. Now I’d say from our business, we are more competitive than we were last year.

We’re building share. Our NTS holding and growing share continues to build. We’ve got very strong positions in self care, if I take our biggest brand, anemia, Nicorette with over 50% market share and that continues to build on Listerine, building share across the portfolio, just taking number one position back again in Brazil. Johnson’s baby performing very well. And in skin health and beauty, and remember Steve, you asked me this question last year.

We just rolled out Aveeno from a very, very strong footprint in The UK into 13 markets in Central And Eastern Europe. That launch and rollout has gone very well and continues. Aveeno is growing over 20% and build share, so very strong momentum. And in Southern Europe, we focus on Neutrogena. I invite you to go and see the pharmacy around the corner and see the in store activation there, but that’s performing well.

So if I look to what we can control, the program and the plans, I’m very confident on a lot of innovation coming landing second half of the year, 70% of our innovation is landing second half of the year. And our focus on in store execution, TDPs, perfect store continues. With regard to seasons, a little bit different in EMEA and LatAm, not really analogy season. And for us, it’s cough cold and in Brazil, I think Southern Hemisphere is sun, let’s say quarter four, quarter ’1. And in quarter four, it’s a sell in in the pharmacy.

So you preempt the season with the pharmacist that is expected to continue. And then obviously, the sell through depends on the seasons. Quarter one was impacted by a weak coughcold season, a weak sun season in EMEA and LATAM. So that depressed, I think, particularly LATAM markets as well.

Thibault Mongon, Chief Executive Officer, Kenvue: As we can tell, I think in this type of environment, what really matters is to find the consumer where they are.

Steve, Unclear: Yes.

Thibault Mongon, Chief Executive Officer, Kenvue: So you have Carlton talking about price point, making sure that you have the right price point, the right price pack architecture, the right innovations, right marketing campaign that we continue to to deploy around the world with a lot of intentionality. Okay.

Steve, Unclear: Regardless of where 2Q finishes and and and the leaping off point, your your outlook had always been more back half weighted. In terms of controlling what you can control, maybe talk us through some of the remind us of the drivers of that second half acceleration, both globally. And then, Carlton, if you want to kind of overlay anything from your perspective.

Thibault Mongon, Chief Executive Officer, Kenvue: Let me start and then Carlton can so you’re absolutely right. Our plan was always backloaded with for for a couple of reasons. Number one, we don’t expect in the second half to have some of the negatives we are seeing in the first half. So the first pillar is absence of negatives, right? When you get into the second half of the year, you cycle through the price investment that we talked about.

The destocking in China would be behind us. So in terms of comps and absence of negatives, that’s a natural tailwind. Second, we continue to execute our plans and and and bring to life what we call our five extraordinary powers. So, you heard from Carlton, seventy percent of his innovation for the year lands in the back half. Around the world, we are, we have a strong back half in terms of, innovation.

We continue to launch breakthrough marketing campaigns. We just launched, I think, start we started last week our new campaign, Mouse Your Wash Your Mouth for for Listerine in The US. We’re going to roll it out, around the world in in the in the back half. I could go on and on and on, but the marketing and commercial plans, are very strong in, in in the back half. So we regardless of the external environment, we expect an acceleration in the back half.

What’s going to define the slope of the acceleration in the back half is the all the underlying demand for for our categories. And same thing here, macro and season. People tend to a lot on macro. I keep repeating for us is macro and and season given the nature of of our business. And so that’s where we will see where we land.

I think for the summer season, it’s too early to call it. Once we have four to eight weeks more data, we’ll we’ll see if it’s again a shift or a net a a net negative. And for the macro environment, it it continues to be extremely fluid. So that’s we are not counting on a revival of of of the consumer in the back half of the year, But we are absolutely focused on executing our commercial plans, launching innovation, making sure that we get the right price points, right price pack architecture and execute flawlessly every day in every geography. So when we get out of this cycle, we are stronger.

We have stronger share, and we are ready to accelerate, which is a key in this type of of an environment. Be agile short term, but don’t lose sight of the long term potential. Carsten, what do you see?

Carlton Lawson, Group President of EMEA and Latin America, Kenvue: Yes. And I link one thing with the new operating model, marketing operating model that you talked about. I think our speed of innovation has dramatically increased. We’re seeing Listerine Total Care in Germany, alcohol free variant launching in five months. We’re seeing Johnson’s Baby, a new insight around scents in Brazil launching in six months.

We’re seeing in fem care period pants launching with a whole new supply chain in just over twelve months and becoming the brand leader in that important segment of particularly the teens and young women 26% market share leveraging our iconic brands, Nicorette, Lozenge and so lots of examples. And if I look at the back half where I say, said 70% of our innovation sales are landing. We’re launching, rolling out collagen bank, Neutrogena collagen bank, which have been very successful in The US. We’re rolling out Aveeno continued across EMEA and more face platforms, Listerine clinical solutions. So lots of innovation coming, Plus our continued focus on our flawless execution go to market through the pharmacy channel, through e commerce and mass.

Perfect store and our presence in media. We’re really up waiting our influencer campaign and it’s great to see normally influencer campaigns are very local and that will remain so, but leveraging a global talent like Tate McCray on Neutrogena and driving the efficiency as she does a world tour and us leveraging that seeing great impact.

Steve, Unclear: In addition to macro and seasons, one other thing you can’t control is the tariff environment. How are how is the sort of ever changing nature of tariffs and tariff related policies just influencing how you’re planning the business?

Thibault Mongon, Chief Executive Officer, Kenvue: So I’m going to state the obvious. The environment is very fluid, right? We we gave you an update in our latest earnings call. At that time, we said that the impact for ’25 would be the gross impact would be around $150,000,000 Since then, the situation has changed again. So it’s slight positive on the China front.

We see where we learn on the EU front. So it continues to be very fluid. For us, it’s about making sure that our supply chain is as least exposed as possible to tariff. And we start from a good starting point. We tend to manufacture close to our consumption region for region.

We have a little bit of finished goods, raw materials, packaging, crossing borders. And so that’s an encouragement for us to adjust our supply chain. Now it’s not going to happen overnight because, again, we are very local for local. If it’s not the case, there is probably a very good reason for it. And so we cannot change it overnight but we are working on residing dual sourcing, all sorts of things in that area.

We are also looking at efficiencies in our overall organization. And we have ongoing conversations with our retail partners to see how we can make sure that we minimize the impact for our consumers. So we don’t have this as a distraction from all the good works that’s happening on the other side. So these are type of things that we are dealing with. Very fluid environment, you need to be very agile, but also take this opportunity to look at how your supply chain is is done, but not lose sight of long term overall value proposition for consumers.

Steve, Unclear: Okay. As you as you mentioned earlier, there’s been a lot of change and progress made on the operating front, operating model front, exiting the TSAs, investing in people, investing in a and p, investing in lots of different capabilities. Where do you feel you are in that journey? Where do you feel like you have a margin of advantage versus the peer set? And then, Amit, I’d love your perspective.

Just as you come in fresh, where do you see kind of your strengths? And where do you see, based on your own experience some of the opportunities that may lie ahead?

Thibault Mongon, Chief Executive Officer, Kenvue: Yeah. The separation is behind us. Now we are in the transformation phase to modernize the company, make it fit for purpose. And really, core is how we bring to life these five extraordinary powers. So clearly, strength is superior science, expert recommendation, very strong trust with iconic brands built over years, decades, generations.

So that is a very strong strength of ours and that continues to be. Through our transformation, we are bringing these strengths to life in a much bigger and impactful way through what we call our breakthrough marketing initiatives. So if you look at what we are doing with Tylenol Mhmm. We bring our superior science. We bring our number one doctor recommendation to to life in social media friendly way with new innovation, with an expansion of the brands into topical analgesics.

Or now, this month, we are launching supplements and as a Tylenol brands for joint pain. And all of that has been very, very successful with also an acceleration in e commerce and gain of distribution overall. So if you take Tylenol, one of our biggest brands, a brand that has a lot of strengths to start with, we see the impact that rolling out of five extraordinary power strategy has to really unlock a new level of potential and has a brand gain share, drive household penetration and is even stronger today than it was twelve, twenty four months ago. So that’s real strength of ours, but that’s also an opportunity. Right?

First of all, you are never done because competition keeps moving, consumers keep moving, retailers’ expectations keep changing. But it’s also an area where you are really touching the core of our transformation. You said we’ve been we change talents. We build capabilities. We invest differently.

And and you see that even in our other segment, if you take skin health and beauty, which is the segment where we have probably the most work to do, it’s great to see the power of the five extraordinary powers start coming to life with more innovation. Carlton talked about it. More impactful marketing campaigns. We launched campaigns with a duo of doctor Shah, the most followed dermatologist on on social media, and Ted McRae, who is an amazing icon for Gen z. And we saw the impact on consumption going up.

When you see Neutrogena today, second quarter in a row with Neutrogena number one in The US, the largest market in the world. And when you see some of competitors losing share, and that’s really a strong proof point that of five x 20 powers when they are put together synergistically work well. Now we are not done yet. We are still in the midst of this transformation, and we have a lot of room to go to improve and and make it happen across the portfolio.

Steve, Unclear: Amit, anything? Yeah. I think,

Amit Banati, Chief Financial Officer, Kenvue: you know, from my perspective, firstly, you know, I’ve been super impressed with how well how firstly, how complicated the separation Mhmm. And how the scale of the separation and how well it’s been executed. And I think it’s kind of underappreciated externally just the amount of effort it’s taken just to get that separation done. Right? Because, you know, you had you had a hard deadline, and you had to execute to that deadline.

So that I think has taken a lot of organization capacity. And so I think the opportunity is now that that’s behind us, how do we kind of accelerate our performance both on the top line through, you know, the increased investment as well as the new operating model as well as on the bottom line through, you know, optimization, productivity. I think, you know, we know that, you know, we have an opportunity to get to best in class. And so I think, you know, that’s what the teams are focused on. And I think, you know, having that we’ve going in the right direction in terms of the top line, the margin, gross margin improvement, along with the productivity improvements should help us, you know, accelerate the profit growth.

Steve, Unclear: Okay. Thibi, you mentioned skin health and beauty. Carlton mentioned it. And my perception was was Europe was in in in generally was ahead of The US. Seems like that’s still the case.

But it also from your comments, it feels like you feel like the Skin Health and Beauty trajectory and Neutrogena trajectory overall is more or less on on pace, you know, kind of normalizing for retailer dynamics. Is that the right read? Or do you feel like what’s the scorecard on Neutrogena and and Aveeno in The US?

Thibault Mongon, Chief Executive Officer, Kenvue: Yeah. I think Carlton has always delivered strong performance in the past couple of years on skin, health, and beauty. We are our starting point is different in both regions, right? In Europe, Middle East and Africa, we are in expansion mode. And so we see a lot of headroom for our brands to continue to grow in in this part of the world and the brands are so strong and so differentiated that even in a region where you have a lot of competition, really, our brands cut through and and and meet the consumers’ needs.

In The US, it’s a different starting point. Right? We are Neutrogena is the largest brand in in America. So how do you make sure that it continues to be relevant and more relevant every day for for consumers. One of the weakness we had is that we didn’t have the Gen Z consumers with us.

And they are important because they drive a lot of growth in in the category. And that’s why we were extremely pleased to see our household penetration with Gen Z consumers go up in Q1 with Neutrogena for the reasons I mentioned earlier. So if you ask me where are we on on of skin health and beauty journey in The US, we are definitely back in the consideration set for for consumers and for consumers that matter. Are we yet where we want to be? Absolutely not.

We are still, I would say, in investment mode, in transformation mode. I talked about the investments in getting the right price points as an example, but it’s really encouraging to see sequential improvements.

Steve, Unclear: Okay. One of the things that we talked about around the time of IPO was the kind of medium to longer term opportunities around portfolio optimization and and the role that m and a played in in kind of use future strategy. Do you still see the company positioned to achieve a more normalized cash flow profile in ’26 and beyond? And assuming you do, how does that play into your capital allocation priorities? And what is the stance of the of the company towards m and a with right now, it’s been in the back burner.

Does it move to the front burner as early as next year?

Thibault Mongon, Chief Executive Officer, Kenvue: So I mean, it has been three weeks for us. So let’s let me take it. Yes. On on on cash flow, we are we’re in in investment mode right now. We’re in transformation mode, so that uses a lot of our cash.

Right? Separation transformation. Once we have done with this chapter, we’ll move to a a stage where cash flow will materially improve. In the meantime, we are working on working capital efficiency as we speak. So one very recent example is in the in the payable side on the payable side, we are rolling out July 1.

So it’s very soon a new global CanView termed policy. Why now? It’s because until a month ago, this whole part of the business was managed by J and J. So we couldn’t touch it. Now that the separation is effective, we can deploy our own fit for purpose, if you will, policy.

So that’s one example of how we keep working on on it. If I think about, priorities in terms of cash allocations, they have not changed. So, one is investing in our business. We have a lot to do and many opportunities to get a very strong return on investing in our business and in our brands and transforming our company. Second is returning cash to shareholders with a very attractive dividend policy.

We continue to deleverage. We have been very clear about that and and continue to be focused on that. And then we’ll see in terms of m and a or in terms of buyback, we’ll continue to be disciplined around that. And when we have more space, we will certainly look at those, but always with discipline because when you look at our portfolio, it’s very strong today. So the buy is pretty high when you think about M and A moving forward.

So we’ll be very disciplined about it.

Steve, Unclear: Okay. In the one or two minutes we have left, we fast forward and it’s $20.30, and you’re looking back over the last five years. What do you wanna be able to say was the accomplishments of the company?

Thibault Mongon, Chief Executive Officer, Kenvue: Clearly, 02/1930, vision is for Canvio to be the undisputed leader in consumer health. We company where we see our five extraordinary powers being really, really a strength across the portfolio, across geography for the company with significant value created for shareholders along the way. That’s the vision.

Steve, Unclear: Very good. And with that, we are right on time. Okay. Thank you very much.

Thibault Mongon, Chief Executive Officer, Kenvue: Thank you, Steve.

Steve, Unclear: Thank you, Steve. Thank you all for joining us.

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