P&G Paid $3.9 Billion Cash For Thorne With Short-Term Debt Up To $17 Billion
Debt due within a year rose to $17,028 million as gross margin fell 160 basis points and current liabilities topped current assets by $12.5 billion.
Procter & Gamble, the consumer goods maker behind Tide, Pampers and Gillette, carried $17,028 million of debt due within one year at September 30, 2026, up from $11,296 million at June 30, 2026, its 10-Q shows. The borrowing ran ahead of the all-cash Thorne purchase, which closed October 1, while commodity costs squeezed margins.
Borrowing ahead of the deal
Net additions to other short-term debt were $5,758 million in the quarter. Cash climbed to $15,365 million from $9,942 million at June 30, 2026.
Financing activities generated $1.1 billion, which the company attributed mainly to a net debt increase tied to the planned Thorne acquisition, partly offset by dividends and share buybacks.
Current liabilities exceeded current assets by $12.5 billion at quarter-end, against $10.2 billion in the filing for the quarter ended March 31, 2026. The company said it expects to support short-term needs largely through operating cash flow and cited strong debt ratings that should let it refinance in commercial paper and bond markets.
Thorne and its accounting
P&G completed the purchase of Thorne, a premium wellness and supplement brand, on October 1, 2026, for $3.9 billion in cash. Most of Thorne's sales are in North America, and it joins the Personal Health Care business. The main assets acquired are an indefinite-lived brand intangible and goodwill.
The company calls Thorne's results not material. They will first appear in the three months ending December 31, 2026, when the preliminary purchase price allocation is also due to be finalized.
Commodities take 140 basis points
Gross margin fell 160 basis points to 49.8% of net sales. Commodity costs and product and packaging investments each cost 140 basis points. Manufacturing productivity savings of 120 basis points, lower tariff costs of 50 and higher pricing of 20 offset part of it.
Net sales rose 4.0% to $23.3 billion, but net earnings slipped to $4,757 million from $4,781 million. Diluted earnings per share rose 1% to $1.97. In its earnings release, P&G said it now expects a commodity cost headwind of about $1.4 billion after tax this fiscal year.
The company's June 2025 restructuring plan includes cutting up to 7,000 non-manufacturing overhead jobs by the end of fiscal 2027. Its cost estimate is now a single figure of about $2.0 billion, where the prior filing gave a range of $1.5 billion to $2.0 billion. The separations reserve stood at $218 million at September 30, 2026.
Suppliers and the supply chain program
The amount owed to suppliers in the company's supply chain finance program, included in accounts payable, was approximately $6.5 billion at September 30, 2026, against about $6.2 billion at June 30, 2026.
The next 10-Q, covering the three months ending December 31, 2026, will carry Thorne's first results and the final purchase price allocation.
Sources
- 10-Q Filing — Procter & Gamble (PG) — SEC EDGAR
- 10-Q Filing — Procter & Gamble (PG), Q3 FY2026 filed 2026-04-24 (comparison basis) — SEC EDGAR
- 10-K Filing — Procter & Gamble (PG), filed 2026-08-04 (earlier disclosure) — SEC EDGAR
- 8-K Filing — Procter & Gamble, filed 2026-10-16 (Items 5.07) — SEC EDGAR
- Earnings release (8-K Item 2.02, fy2627q1jas8-kexhibit991.htm) — Procter & Gamble, filed 2026-10-22 — SEC EDGAR
- Procter & Gamble (PG) Q1 2027 earnings — CNBC
- P&G tops revenue estimates, expects bigger annual profit hit from commodity costs - The Globe and Mail — theglobeandmail.com
- Procter & Gamble’s Sales Offset Rising Fuel Costs - WSJ — The Wall Street Journal
- P&G Announces Fiscal Year 2027 First Quarter Results – Company Announcement - FT.com — Financial Times
- P&G: Fiscal Q1 Earnings Snapshot – WTOP News — wtop.com
