Procter & Gamble Company (PG)
Profitability ratios
Return on sales
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|
| Gross profit margin | 51.16% | 51.39% | 47.86% | 47.43% | 51.25% |
| Operating profit margin | 24.26% | 22.07% | 22.11% | 22.21% | 23.63% |
| Pretax margin | 23.93% | 22.32% | 22.38% | 22.44% | 23.14% |
| Net profit margin | 18.95% | 17.70% | 17.87% | 18.38% | 18.79% |
The profitability ratios of Procter & Gamble (P&G) over the period from June 30, 2021, to June 30, 2025, demonstrate certain trends and stability in the company's earnings efficiency.
The gross profit margin experienced fluctuations within the reporting period. It decreased from 51.25% in 2021 to a low of 47.43% in 2022, indicating a reduction in the company's ability to generate profit from its core sales after direct costs. However, it showed a slight recovery in 2023 to 47.86%, and further increased to 51.39% in 2024, before marginally declining to 51.16% in 2025. This pattern suggests periods of pressure on gross margins, possibly due to increased cost of goods or competitive pricing strategies, followed by recovery possibly due to operational efficiencies or pricing adjustments.
Operating profit margins followed a similar downward trend from 23.63% in 2021 to 22.11% in 2023, with minimal variation in 2024 at 22.07%, before increasing again to 24.26% in 2025. The stability and subsequent increase suggest improvements in operating efficiency or cost management efforts, particularly in the latest year, which positively impacted profitability at the operating level.
Pretax margins remained relatively stable, decreasing slightly from 23.14% in 2021 to 22.38% in 2023, then maintaining a similar level in 2024 before rising to 23.93% in 2025. The pattern indicates that the company's pre-tax profitability was relatively consistent with minor fluctuations, with an improvement noted in 2025, possibly driven by better expense management or pricing strategies.
The net profit margin reflected a slight decline from 18.79% in 2021 to 17.87% in 2023, followed by a marginal decrease in 2024 to 17.70%, and then an improvement to 18.95% in 2025. This suggests that after pressure in the earlier years, the company was able to enhance its bottom-line profitability in 2025, potentially due to improved operational efficiencies, lower tax burdens, or other cost controls.
Overall, P&G’s profitability ratios indicate periods of margin compression primarily around 2022 and 2023, with a subsequent recovery and improvement in 2024 and 2025. The trend demonstrates effective management of operating expenses and strategic pricing, culminating in enhanced profitability at the net level in the most recent year analyzed.
Return on investment
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 16.33% | 15.15% | 15.01% | 15.20% | 15.08% |
| Return on assets (ROA) | 12.76% | 12.16% | 12.13% | 12.58% | 11.99% |
| Return on total capital | 0.00% | 39.15% | 40.74% | 39.57% | 39.06% |
| Return on equity (ROE) | 30.55% | 29.59% | 31.33% | 31.64% | 30.85% |
The profitability ratios of Procter & Gamble Company over the period from June 30, 2021, to June 30, 2025, reveal patterns indicative of relatively stable and sustained financial performance, with some notable fluctuations.
Starting with the Operating Return on Assets (Operating ROA), the data shows a generally consistent trend, with values marginally increasing from 15.08% in 2021 to 15.20% in 2022, followed by a slight decline to 15.01% in 2023. Notably, a modest recovery is observed in 2024, reaching 15.15%, and a more significant increase occurs in 2025, rising to 16.33%. This suggests a resilience in operational efficiency, with a meaningful improvement in 2025 indicating enhanced ability to generate operating income from assets.
The Return on Assets (ROA), encompassing overall profitability, follows a similar pattern but at generally lower levels compared to Operating ROA. It increased from 11.99% in 2021 to 12.58% in 2022, then declined to 12.13% in 2023. Slight stability is observed in 2024 with a marginal rise to 12.16%, and an improvement resumes in 2025 to reach 12.76%. These fluctuations imply that while asset utilization remains relatively stable, there have been periods of slight decline and resurgence in overall profitability.
The Return on Total Capital maintains high levels throughout the period but exhibits an unusual trend in 2025. It starts at 39.06% in 2021, rising steadily to 39.57% in 2022, and further to 40.74% in 2023. However, a decline to 39.15% occurs in 2024, and an anomalous figure of 0.00% appears for 2025. This abrupt and implausible value suggests a data inconsistency or reporting anomaly, as such a drastic change would be inconsistent with observed trends in other profitability ratios.
Finally, the Return on Equity (ROE), a key indicator of shareholder returns, presents a pattern of sustained profitability. It increased from 30.85% in 2021 to 31.64% in 2022, with a slight decrease to 31.33% in 2023. In 2024, the ratio declines further to 29.59%, but then rises again in 2025 to 30.55%. These figures indicate that the company has historically maintained strong profitability relative to shareholders' equity, with minor fluctuations likely reflecting business cycle influences or changes in leverage and net income.
Overall, the analysis suggests that Procter & Gamble demonstrates consistent operational efficiency and profitability. The ratios reflect the company's ability to generate income from its assets and equity, with a notable increase in 2025 implying potential improvements in operational effectiveness or market conditions beneficial to profit margins. The anomaly observed in the return on total capital for 2025 warrants clarification but does not significantly alter the overall interpretation of sustained profitability over the analyzed period.